Christopher Dodd

Mr. DODD

Mr. DODD. Mr. President, this amendment--we have checked with the Parliamentarian--is a germane amendment to the bill. It was filed prior to the appropriate time, at the hour of 2:30 p.m. yesterday. Let me explain what this amendment does and why I am offering it this afternoon. I am offering this amendment to enable parents to meet the needs of their children. We just heard our good friend and colleague from Ohio talk about Mothers Against Drunk Driving and the problems that occur with underage drinking. It is appropriate, after that discussion, that I offer this amendment because it is not unrelated, we know the difficulty of single parenthood, of how hard it is for single parents, the overwhelming majority of whom are women, to try to raise children on their own, all of the pressures of holding down jobs and managing a family. It will not come as any great surprise to my colleagues to know that a significant percentage of underage drinking and children who have problems with the juvenile justice system and other related issues come from broken homes, unfortunately. The tremendous pressures of a single head of household holding down a job and keeping their family together is not easy. This amendment I am offering today on this bankruptcy bill relates to these familial circumstances, and it comes in several parts. I am going to take a few minutes and explain this amendment and why I believe it is important. Very simply, during the financial crisis of living through a bankruptcy, children should be protected to the maximum extent possible. That is my strong belief. I believe it is the belief of all of us. Regardless of one's politics or ideology, I think we all understand that when a family is going through bankruptcy, we ought to do what we can to protect the innocent. Whatever one's feelings may have been about the parents, about their responsibility or irresponsibility, children should not be penalized because of the sins or the faults of their parents. This amendment is designed to at least attempt, under those trying circumstances of a family going through bankruptcy, to protect those who are innocent--the children--to the maximum extent possible. About 39 percent of those filing bankruptcy in the United States are single women raising children, almost 40 percent. About 29 percent, almost 30 percent of those filing for bankruptcy are men, and 32 percent of households filing for bankruptcy are married couples. So we are talking about 70 percent of those who are filing fall into the area of single parents and their problems related to it. While there may be some people who are trying to scam the system--and there certainly are, and I do not argue with that point at all--I believe most people do not file bankruptcy lightly. It is a highly emotional time and one of financial crisis. The most common reasons for 90 percent of women filing for bankruptcy include medical emergencies, job loss, and divorce. Women are especially vulnerable because they tend to have lower incomes and fewer assets and are more likely to be caring for children on their own. If my colleagues truly cared, and I believe they do, about protecting mothers and the innocent children who are caught up in the tremendously disruptive time of bankruptcy, I think they will end up supporting this amendment. At least I hope they do. If our colleagues truly care about marriage and strengthening marriages, they also would support this amendment. I cannot think of many more things more stressful on a marriage than filing bankruptcy. My amendment covers four main areas to protect children during this turbulent and emotional time. The amendment would modify the means test to provide greater flexibility and reasonableness when calculating a debtor's ability to pay. Allowable expenses are broadened to ensure that parents, whether married or divorced, can still support their children as they live through a bankruptcy. For example, the amendment would allow a single mother, recently deserted by her husband, raising children who has filed for bankruptcy to continue paying education expenses for her child. Let us say that the mother, being a religious person and from a family that had used parochial schools for generations, is struggling to keep her child in one of these parochial schools. In this case, her 10 year old son has gone to a parochial school since kindergarten. It is where his friends go. After being fairly shy and withdrawn, he has begun to thrive there, has developed close relationships with several of his teachers. The mother was able to obtain a hardship reduction in tuition from the archdiocese, reducing the tuition to $3,500 a year. Under the means test in the pending legislation, under our bankruptcy bill, this mother could not file chapter 7 or chapter 13 if she continued to send her son to parochial school. The means test allows only $1,500 for tuition and any other education expenses--not enough for any religious school. We are not talking about some fancy prep school or boarding school; we are talking about a basic parochial school education, which in many areas of the country costs around $5,000 per year, sometimes even slightly more. One of my neighbors told me that the parochial high school his son attends costs roughly $8,000 a year. The child did not file for bankruptcy. Why during this turbulent time should the child be ripped away from his circle of friends and moral mentors? This should be a time when the child needs his friends and trusted teachers the most, his circle of security, particularly during a time of separation by parents and a bankruptcy. The amendment would allow expenses associated with employment, such as child care, and it would allow alimony and child support to be used as intended to cover the needs of children in the household. Particularly with children, there are emergency expenses that arise, and any means test ought to reflect that reality. Second, this amendment would ensure that support payments and other funds, such as refunds from the earned income tax credit or child tax credit, intended for the current needs of children do not become the property of the bankruptcy estate with the corollary potential of being distributed to creditors. Money intended to support children and their needs should go to children who need it, not creditors, in my view. Why should the earned income tax credit or the refundable child credit be yanked away from supporting children so that the depth of poverty in which they may live becomes even greater? Thirdly, the amendment enables debtors going through bankruptcy to keep personal property normally found in or around the home, excluding automobiles. This would ensure that in bankruptcy situations, families with children are able to keep, without fear of repossession, household goods that typically have no resale value. Fourth, the amendment would ensure that debtors are not forced into bankruptcy court to seek to prove that some of these items have any value for resale and would necessarily have to be added, forced into bankruptcy court to prove these items were not luxury goods. This amendment, which I had hoped the managers of the bill would agree to, it is more technical than anything else. I am sorry it is not being accepted, because it goes to the very heart of what many of us have talked about and tried to accomplish over the years since bankruptcy laws were first modernized and adopted over a century ago in 1903. This amendment deals with families and spouses, with child support issues and where they come into context of priorities when it comes to discharging responsibilities under the Bankruptcy Act. In 2003, as much as $95 billion in child support payments remained uncollected in the United States. It is a staggering sum of money and makes a huge difference to children growing up under adverse circumstances. It is estimated that one out of every other child living in poverty could be taken out of poverty if we were able to collect child support. Forget about appropriations or tax provisions we may adopt. if we could just collect the $95 billion in unpaid child support, we could virtually eliminate poverty in one out of every two children growing up under those circumstances in the United States. The bankruptcy bill before us is going to make it more difficult in many ways for those families out trying to find those spouses who owe this child support to make it available. Thus, I believe we are going to exacerbate the problem of children who rely on child support and families who rely on alimony being able to get those resources to minimize the effects that a divorce and separation can cause. When one excludes the ability to receive the financial support necessary to make ends meet, the problem becomes, obviously, even more pronounced, and children bear the price. Again, I repeat, whatever one may feel about the parents and their irresponsibility, putting themselves and their families in jeopardy, we ought to be highly sensitive to what happens to children. It is not their fault that their parents are filing bankruptcy. I do not believe necessarily it is the parents' fault either in many instances, with medical expenses, with divorce and job loss being the reason a large percentage of bankruptcies occur. Putting aside that for a moment, whether one agrees with those numbers, I do not know of a single person in this Chamber who would disagree with what I am about to say. Children should not have to pay the price of their parents' mistakes, and yet that is what we are going to do with this bill if we do not take some steps to try to correct the situation. Since 1903, our Nation's bankruptcy laws have been guided by the firm principle that women and children must be first in the distribution line of available assets during a bankruptcy proceeding. For over a century, debt owed to children and families has been nondischargeable. Thus, if a head of a household fails financially, whatever remaining assets he has could be used to spare his spouse or ex-spouse and his children from impoverishment. We do this because those who are most vulnerable in our society deserve the most protection. Today's bill, the Bankruptcy Abuse Prevention and Consumer Protection Act, would fundamentally alter this delicate balance achieved after a century of jurisprudence. We are altering the bankruptcy landscape for the benefit of credit card industry without understanding or recognizing what the consequences for families will be. Women and children will be disproportionately affected by this legislation unless it is amended, which is what I am trying to do with the amendment now before us. Whether as debtors filing for bankruptcy themselves or as creditors, three-quarters of a million women will be affected this year by the bankruptcy system, and it is estimated that as many as 1 million women will be affected in the coming year. I agree with those of my colleagues who think the bankruptcy law needs to be reformed and tightened. I do not disagree at all with that. But in my view it is possible to enact legislation that tightens the laws without depriving debtors and their families of reasonably necessary living expenses to care for their children. As this legislation is currently drafted, however, the credit card industry is protected, more protected than they have ever been. Unfortunately, families are not, in my view. This bill could turn the lives of children and families literally upside-down. I think it is enough of an emotional roller coaster for a parent to file bankruptcy, but I think to elevate the needs of the credit card companies over the needs of children is simply wrong. I am greatly concerned about the means test, which requires the trustee in bankruptcy to review all chapter 7 cases for ability to pay debts under a rigid IRS formula devised originally for delinquent taxpayers, now to be applied to bankruptcies. These standards neither take into consideration differences in the cost of living from region to region, nor do they ascribe rational expenses for the use of individual families. In my view, these rigid standards will deprive children and families of reasonably necessary living expenses. While moving child support to a first priority among unsecured creditors in chapter 7 sounds good, it is virtually meaningless, however. Listen to this. Fewer than 4 percent of chapter 7 debtors have anything to distribute to unsecured creditors. Listen to that again. Fewer than 4 percent of chapter 7 debtors have anything to distribute to unsecured creditors. That is to say 96 percent of these debtors have nothing to give out. So saying under chapter 7, ``you are first in line,'' means absolutely nothing except to 4 percent of those debtors. First in line when there is nothing means nothing. This is not a protection for women and families. It sounds good, but it is totally hollow when it comes to seeing to these children and these families whom, for 100 years, we have done a better job of protecting. Additionally, because the means test increases the potential for dismissing chapter 7 cases, this bill channels many debtors into the 5- year, chapter 13 repayment plans, even though we know for a fact that two-thirds of such plans fail today. What will families live on during this time? What are proponents of this legislation going to do, go back to the time of Charles Dickens or debtors prisons? Under chapter 13, the bill would require that larger payments be made to credit card companies. As a result, payments of past-due child support would be made in smaller amounts and over a longer period of time, thus increasing the risk that children will not receive the support they need and the full debt would never be paid. Mothers and children would be in direct competition with credit card companies employing well-financed collection departments. How do you think mothers and children will fare when it comes down to competing? It is hard enough under the present system for these people to collect the $95 billion they are owed in one single year in child support, when they now are going to also have to compete, under chapter 13, with credit card companies who are well heeled and in a far better position financially, with teams of lawyers, to go after these debtors. I do not believe anybody could rationally conclude that a mother raising two or three children on her own, with limited resources, is going to be able to hire the lawyers to compete with the credit card companies going after the debtor husbands in these cases. Those are the practical realities. So for children and families, this bill makes life a lot worse because of exactly what I have explained: we are moving people out of chapter 7, where there was nothing much to give anyway, into chapter 13, where it becomes far easier for larger amounts of these resources, larger payments, to be made to the credit card companies. I am very concerned about the provisions of the legislation that make certain credit card debt nondischargeable. While the family support provisions added to this legislation are positive improvements, they have not cured the problems caused by the other provisions of the bill. In fact, they are negated by them, in my view. These are provisions that give far greater collection rights to the credit card lenders and fewer, in my view, to families and children. This bill elevates credit card debt to a presumed nondischargeable status. If a debtor purchases items or services on credit from a single creditor within 90 days of bankruptcy, and such items exceed $500 in value, these items would be presumed luxuries. Listen to that again. Within 90 days, if you make purchases from a single creditor exceeding $500, they are presumed luxuries--in 90 days--3 months. Again, if you are a single parent with two or three kids, over 90 days $500 is not a huge amount when you are talking about groceries or other essentials. Over a 3-month period--stretch it out and do the math--$500 over 90 days is really, in 21st century dollars, even if you go to the best discount stores, not going to be enough to make it. Current law allows up to $1,225 to be discharged within 60 days of bankruptcy. The bill as reported would limit it to $500 within 90 days, as I have said. The amendment I will offer when the time comes to vote on it will allow not $500 but less than $1,200 to $1,000 within 70 days. So it is less than 90, a bit more than 60. It is less than $1,200 under current law but certainly more than $500 to get you to $1,000. Again, I don't think this is any great luxury. You are trying to meet the needs of your family. To declare them to be luxuries--it doesn't seem a lot to me. Over a 90-day period it is not that hard to spend $501 at Wal-Mart to meet kids' needs. Most would agree such purchases are not luxuries. In 90 days alone, a family with children could exceed $500 on other expenses that arise with children. My amendment requires creditors to prove at a hearing that such items were not reasonably necessary for the maintenance and support of the debtor and her dependents, shifting the burden to creditors rather than the parents. If the creditor wants to make the case, let them do it, but don't lay the burden for $501 on a single mother with young kids to hire lawyers to go in and make the case these are not luxury items. I shift the burden over to the creditors. If they want to make the case, they can do so. I don't know what the proponents of this legislation are intending here, other than to protect the credit card companies at the expense of children. If you have $501 of food, medicine, and clothing expenses, and it is incurred within the last 90 days, then you have to go to court and spend money to prove these are not luxuries--food, medicine, and clothing. This point is one I find stunning in its potential implications. By the very fact that you are in bankruptcy court, how are you going to hire a lawyer to go in and prove that $501 was for necessities and not luxuries? We need to be far more practical than that, it seems. To go to Wal-Mart and buy food and clothes for your children, necessities they may need, that is considered a luxury if it is more than $500. If you are a single woman as a creditor, then you must wait until your ex-husband tries, or does not try, to defend a similar purchase. If he is unsuccessful, there will be less money for him to pay child support. So on either side of the equation, if you are the woman raising children on your own, either as a debtor or a creditor, this places tremendous burdens on your family. If this section is sustained in the bill, then I urge the President to veto it, which I am told he would not do, but I hope he would. This legislation, regardless of what else is here, I think putting credit card debt ahead of kids is just wrong. I think all my colleagues are probably familiar with the popular TV ad where a father takes his son to a baseball game, they rack up maybe $100 in costs--tickets, parking, hot dogs, sodas, maybe a popcorn to share and a small souvenir. The tag line in the commercial says: ``Cost of the memory--priceless.'' What the commercial doesn't tell you about is the memory may be priceless, but if the next day that dad is unlucky enough to lose his job, have a heart attack, incur enormous hospital expenses without health insurance, and can't make his minimum payments on time, the credit card companies are only too happy to turn priceless into pricey. Unfortunately, pricey for the family with finance charges, overcharges, penalty fees, and other means, can turn a dream into a nightmare. This bill allows families to take a backseat to lenders, if lenders say their claims are secured by the debtors' property. For the first time in over 100 years, we have allowed these heretofore unsecured creditors to get into the bankruptcy courthouse. Currently, child and family support, taxes, and student loans are not dischargeable debts. For the first time in a century, the proposed legislation before us would bring into this unique category these other creditors--i.e., credit card companies--which will make the competition for scarce assets that much more fierce. These creditors have historically been unsecured because they have received the benefit of high interest and finance charges. Now they are becoming effectively secured creditors. With all of these concerns in mind, the amendment I am offering this afternoon seeks to address some of these problems. I hope these efforts will win broad bipartisan support. I have been terribly disappointed that there has been no willingness to even talk about some of these amendments. I don't know why we can't do this. This is not the end of the session. We are only in the month of March. This is an important bill. I understand that. But it is going to have huge implications for years to come if we don't sit down and listen to each other carefully to try to work out some of these matters so we can put a bill together. Yes, it may require a conference; it may require some negotiation. But isn't that a wiser course to follow than to rubberstamp a proposal because the other body doesn't want to sit down in conference on the bankruptcy bill, particularly when we are talking again about the most vulnerable in our society; that is, our children? Again, I emphasize what I said at the outset. We are talking about the innocents here. I don't want them to fall prey to the claim that people taking bankruptcy are guilty of something somehow. Again, if you accept the notion that most people who file bankruptcy are not doing so lightly, I don't know of anyone who likes to admit they are so messed up in every way possible that they put themselves in that situation. Are there people who take advantage? Yes. I know that is true. As we try to cure that problem, let us not create more problems for those who through no fault of their own find themselves in that situation; and, even worse yet, those who are completely innocent who find themselves so disadvantaged that the ability of parents-- particularly single women raising children--to find it harder and harder to collect those child support payments they desperately need to lift these children out of poverty, to make ends meet in the 21st century, with companies going bankrupt every day. We must see to it that those families who are already going through an awful lot don't find themselves going through even more. This amendment is a modest attempt to readjust this section of the bill, to inject some practicalities, to say that as we consider the rights of credit card companies we are not going to forget the rights of children, so we will put some reasonable ceiling in here to make it possible for everyone to be a winner, so people can go to bankruptcy court to get themselves out of debt, get on their feet again, see to it that creditors are going to have an opportunity to collect the obligations that are owed them, and not penalize those who ought not be a part of this debate in any consideration. I urge my colleagues to think about these amendments. I know it means changing the bill. I know it may mean going to a conference for a day or two. But I urge my colleagues to at least look at these proposals. If they make some sense, as some of them do, can't we sit down and try to resolve some before we go ahead and pass a bill that I think many may regret down the road when we consider the implications for those who are going to be adversely affected by this legislation? I also would like to add as part of the Record a couple of pieces of correspondence that speak to these particular issues. One is from the National Women's Law Center, a letter dated February 23, 2005. I will not read the whole letter. Let me read a couple of paragraphs, because they go to the heart of what I am talking about here. The letter reads: S. 256 would make it harder for women to access the bankruptcy system because the means test requires additional paperwork of even the poorest filers, harder for women to save their homes, cars and essential household items through the bankruptcy process and harder for women to meet their children's needs after bankruptcy because many more debts would survive. The bill also would put women owed child or spousal support who are bankruptcy creditors at a disadvantage by increasing the rights of many other creditors, including credit card companies, finance companies, auto lenders and others. The bill would set up an intense competition for scarce resources between mothers and children owed support and these commercial creditors during and after bankruptcy. The letter goes on. I ask unanimous consent that the letter from the National Women's Law Center be printed in the Record.

Mr. DODD. Mr. President, I want to quote a letter from the Children's Defense Fund, again expressing their concern about these sections of the bill. I will read from this letter as well. The Children's Defense Fund is writing to urge you to oppose S. 256, the bankruptcy bill, that would hurt many Americans facing financial problems through job loss, divorce, child rearing, lack of medical insurance, or predatory lending practices. This bill would inflict hardship on more than 1 million economically vulnerable women and families who are affected by the bankruptcy system each year. Medical emergency, job loss and family breakup are important factors which account for nine out of ten filing for bankruptcy. The bill would also hurt women who are owed child or spousal support by men who file bankruptcy. The bill would make it far more difficult for women to collect support because credit card companies and other commercial creditors will have greater claims to the debtor's resources during and after bankruptcy. Being first among unsecured creditors in chapter 7 bankruptcy is meaningless when over 95 percent of debtors have no resources to pay unsecured creditors. In chapter 13, the bill would require larger payments to be made to many commercial creditors resulting in smaller payments to past-due child support over longer periods of time increasing the risk that child support debts will not be paid in full. And after the bankruptcy is over, more and more debts owed to commercial creditors will survive, and mothers and children owed support are not a match for the collection departments of the commercial credit industry. S. 256 contains a number of provisions which would have a severe impact on families trying to regain their economic stability through the bankruptcy process. The letter goes on. Those are pertinent paragraphs when it comes to the amendment which I am offering here today. I ask unanimous consent that this letter be printed in the Record.

Mr. DODD. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. DODD. Mr. President, the Association for Children for Enforcement of Support is supporting this amendment and opposes the legislation. The American Association of University Women, American Medical Women's Association, the Business and Professional Women of the United States, the Center for Law and Social Policy, the Center for the Childcare Workforce, Child Welfare League of America, the National Council of Jewish Women, the National Organization for Women, the National Partnership for Women and Families, the YWCA of the United States--all are groups which support the amendment and oppose this legislation. Again, I realize the hour is late. We are getting closer to passage of this bill. I don't think it is so late, however, not to try to make some modest changes in this legislation that I think would go a long way to providing some relief for families. Again, this is one of the areas of law that is written into our Constitution. Article I, section 8 of the U.S. Constitution, drafted back in the 18th century, specifically provided and called upon the Congress of the United States to enact bankruptcy laws. To understand why they did so, go back and look at the Federalist Papers. They talked about doing it as an opportunity for people to get back on their feet again. That was the idea--to see to it that creditors could be compensated to the maximum extent possible, but that also those filing for bankruptcy would begin a new chapter in their lives, to get on their feet again. It seems to me we ought to be trying to do that with this legislation, not only helping the creditors collect what is due them, but simultaneously making it possible for good people to get a fresh start. If in the process of helping the creditors get paid we make it more difficult for people to get on their feet again, we are lacking the balance which I think we ought to be striking with this bill. I urge my colleagues not to necessarily rely on what I have said here today, but to review these sections of the bill and ask yourself realistically whether in this day and age the kind of caps we are putting on, kind of forcing people into the chapter 13 category, if we are not exactly undoing what we have done for 100 years to modern bankruptcy laws. The modern bankruptcy laws put not only families first but they also left them alone. If you were dealing with child support and alimony, once you paid those, or set up a payment schedule, whatever is left over, you dispensed to your creditors, you were not only the first in line, you were the only one in line. This changes that. You can be first in line under this bill, but you are not the only one in line, and other people in line have far more resources and strength to be able to compete for those debtors' funds to compensate these creditors. It puts families at a disadvantage. There are a lot of other reasons to be concerned about this bill. I know my colleagues care about children. I know they care about families. They want to see these innocents have a chance for a decent life. This bankruptcy bill, if not amended, will make it far more difficult to achieve those goals. I yield the floor and suggest the absence of a quorum.

Mr. DODD

Mr. DODD. Mr. President, I ask unanimous consent that the pending amendment be laid aside and that amendment No. 67 be called up, the reading of the amendment be dispensed with, and the amendment laid aside so that the next amendment may be called up.

Mr. DODD. Mr. President, I ask unanimous consent that the pending amendment be laid aside and, on behalf of Senator Kennedy, that amendments Nos. 68, 69, 70, 71, 72 and 119 be called up in turn, that reading of each amendment be dispensed with, that each amendment be laid aside so that the next amendment may be called up.

Mr. DODD

Mr. DODD. Mr. President, I briefly mentioned this amendment before. This amendment focuses on a abusive practice that I have to believe all of my colleagues would want to see done away with, this universal default practice. Let me explain what this means. Under a universal default, which almost all these companies now engage in, it says that credit card companies have the right to raise fees and rates, whenever they want, for any reason I choose. That language actually is included in some of the small print. Again, I believe that consumers have an important responsibility for the debts they incur. However, I think it is patently unfair, that if you are paying your minimum monthly balance to the credit card company, and for whatever reason you are not meeting your obligation to the car payment, the house payment, or the utility bill that you be subject to a universal default clause. And while I think the practice should be banned, if it is part of the credit card agreement, credit card companies are allowed to raise your rates even though you are meeting your obligation to them. This amendment simply restores some basic fairness in this arrangement. You can raise interest rates--but only prospectively on new purchases. However, it prohibits retroactively rate hikes, that is, raising the interest rate on purchases you may have made a week, a month, a year, or 2 years earlier. Let me make the point again. I understand why the credit card companies would like to do this. Obviously, they make more money doing it. But I think we have an obligation to see to it that there is a sense of fairness about all of this. That is what I am trying to do with this amendment. That is all this amendment does. It just says here you cannot apply these rates retroactively. On future purchases, fine. Again, I think the practice of universal default is unfair. If I have a contract with my friend from Alabama at a certain rate and I am meeting my responsibilities to him, he is lending money at 15 percent, and for whatever reason I have a contract with my friend from Georgia, and we have a dispute about my payment obligations to you, my friend from Alabama then can automatically raise my rate to 20 percent, 25 percent, or 30 percent because of my dispute with the Senator from Georgia. The idea that a credit card company can charge an initial interest rate that would have in the past been outlawed as usurious and then double or triple that rate for any reason it chooses is just plain wrong, in my view. If a phone bill is inadvertently mailed to the wrong address, you are disputing the bill that is not paid on time, does the mortgage rate on your home go up? No, but apparently your credit card interest rate can. Record number credit card companies have built-in universal default clauses in their agreements. ``Universal default complaints are definitely on the increase at a disturbing rate,'' says Paul Richard, director of the nonprofit Institute of Consumer Financial Education. More than one-third of all major credit card issuers now say they act on these clauses regularly. A recent survey found that a staggering 39 percent of credit card issuers apply this universal default rate to consumers even if they have no late payment on their credit cards. A recent New York Times article entitled ``Plastic Trap, Soaring Interest Rate Compounds Credit Card Payments for Millions'' illustrates the point. Ed Sweibel was whittling down his mound of credit card debt at an interest rate of 9.2 percent. The MBNA company had a happy and profitable customer. But this past summer when MBNA suddenly doubled the rate on his account, Mr. Sweibel joined the growing number of irate card holders stunned by lenders' harsh tactics. Mr. Sweibel, 58 years old, a semiretired software engineer in Gilbert, AZ, was not pleased his minimum monthly payment jumped from $502 in June to $895 in July. But what really made him angry, he said, was the sense he was being punished despite having held up his end of the bargain with MBNA. ``I paid the bills the minute the envelope hit the desk. All of a sudden in July they swapped it to 18 percent, no warning, no reason. It was like I was blindsided.'' Mr. Sweibel had stumbled into the new era of consumer credit in which thousands of Americans are paying millions of dollars each month in fees that they did not expect and that strike them as unreasonable. Invoking clauses tucked into the fine print, lenders are doubling or tripling interest rates with little warning or explanation. What truly astounds me is the fact that credit card companies view the practice as completely legitimate. In fact, when in fine print they disclose they engage in this practice, the language they use is incredibly brazen. One credit card issuer states in its standard disclosure: We may change the rates, fees, and terms of your account at any time for any reason. Rates, fees, and terms--is there anything left in the credit card contract that a consumer can count on staying the same? I understand why they would want to do this, but, again, I do not understand why the Congress should continue to allow them to continue this practice. As I pointed out at the outset of these remarks, I carry a copy of the U.S. Constitution with me. In Article I, section 8 of the Federal Constitution--the Framers decided--that it is our job to write the Bankruptcy Code. In the initial draft of the Constitution, the Framers thought this was a significant enough issue. It is hard to find any more complicated or difficult issue than bankruptcy, and yet the Framers said do it. Why did they do it? Again, the point I tried to make at the outset: The Framers wanted to give people a chance to get back on their feet. If we allow these credit card companies to constantly raise the bar--we will force future generations into never ending indebtedness. In the article I just read, Mr. Sweibel was trying to get rid of his debt and meet his obligations. No matter how diligent he was in paying his bills, his credit card company jacks up his interest rate--almost doubling it in one month because of a disagreement he had with some other obligation. That is wrong. Again, I understand why the credit card companies may want to get away with it, but we should not let them get away with it. We have an obligation to people, to make sure that people play fair, play by the rules, and act responsibly. It is irresponsible for a credit card company to be able to double and triple the interest rates on someone when they are meeting their obligations of that creditor. I think it is wrong and unfair. If we do not put our foot down and say it is wrong and unfair, they are going to continue to get away with it, and we are never going to see consumers get beyond the mountain of debt they are accumulating. Almost one-half of the $2.1 trillion in debt is consumer credit-card- related debt. The savings rate is down to less than 1 percent in the country. Consumer debt is skyrocketing, and we are handing these credit card companies a gift they could never have imagined when the Framers of the Constitution were around. We should not be allowing credit card companies to use farcical excuses to penalize unaware consumers who pay their bills on time. If a credit card company wants to change the rules of the game, they should not be allowed to reach back and set new terms and conditions to purchases made under previous agreements. This is just plain, basic fairness. If for some reason a credit card issuer views a customer as an increased credit risk, which is the purported justification for the universal default practice, then it can decide to only lend future credit at a higher rate or with different terms. Also, consumers must be given ample notice of this new credit decision so they can fully understand the changes in the new contract. This amendment is a necessary addition to the bill. It will not solve all the problems, but it will solve a major one, the universal default clauses. Amendment No. 52 I call up amendment No. 52 at this point, the one that was set aside.

Mr. DODD. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

Mr. DODD. Mr. President, I ask that amendment No. 52 be laid aside, and I call up amendment No. 53.

Mr. DODD. Mr. President, I wish to call up two amendments. I believe the first, amendment No. 52, is at the desk. I ask that it be called up.

Mr. DODD. Mr. President, before the Senator departs the floor, I commend my colleague from Tennessee for his comments. I will take a close look at them myself. As usual, the Senator from Tennessee makes an awful lot of sense. The question raised by our colleague from Alabama is an appropriate question. I underscore the last point he made, as well, this idea of dumping on the courts a lot of time to resolve matters which are thorny and difficult. It is a lot easier to do that. We have learned painfully in the area of education, the area of equalization formulas, 47 States have enacted or required through the courts to provide equalization of funding for elementary and secondary education. I don't know of a single State that has done it yet because the political community has passed the ball on, in a sense, to the courts without addressing the issue in a fundamental way themselves. It is another example of Congress not coming to terms with some of the difficult issues. My colleague has pointed out the one dealing with Medicaid. I applaud him for his comments. I intend to take a close look at his bill and may join him. I thank him for his comments this morning. Mr. President, I have been present for most of the votes the past 4 or 5 days but not engaged in the debate on the bankruptcy bill. The reason for my absence is because my wife and I were very blessed on Tuesday morning, in the wee hours, to become parents again. So for the past 4 or 5 days if I looked a little sleepy to my colleagues it is because we have been up with a wonderful new infant. This child arrived a little earlier than expected. I intended to be much more involved in this debate than I have had the ability to. I apologize to my colleagues and to others who have had a strong interest in this legislation. This morning I would like to take a few minutes and talk generally about the bankruptcy bill, and also to propose a couple of amendments which I will describe briefly. I realize any votes on these amendments may occur on Monday or Tuesday, depending on conversation with the majority in terms of how they will handle these matters. The fundamental premise behind the bankruptcy bill, as I understand it and in listening to my colleagues over the last 7 or 8 years who have talked about this legislation, is that more and more consumers across this great country of ours are living rather lavish lifestyles and then filing for bankruptcy to avoid paying the debts which they have incurred as a result of their irresponsibility. This is one of the major arguments for this legislation--that bad actors are depriving credit card issuers of money owed to them as a result of people lavishly using these credit cards to acquire whatever products or services they want. This premise, I argue, is categorically and demonstrably false. Let me, first, begin with the first chart, if I may, which lays out the statistics of what happens to an individual in America in the two years before they file for bankruptcy. I hope it will give my colleagues some sense of what actually is going on with these families. Who are these families? Are these people living lavish lifestyles, accumulating debts that they should have been more responsible about, and then trying to avoid their obligations by declaring bankruptcy? Health Affairs, a respected organization in this field, did an analysis of what happened in the 2 years prior for people who file for bankruptcy. The study revealed that sixty-one percent of those who filed for bankruptcy during the previous 2 years had gone without needed medical care, 50 percent did not fill doctors' prescriptions they had been given, 30 percent had their utilities shut off, 22 percent went without adequate nutrition and food, and 7 percent moved elderly parents to cheaper care facilities across the country. These are hardly people who are leading what you would call a lavish lifestyle. In fact, these are people who are desperately trying to hold their families together, who cannot meet the kind of responsibilities despite their best efforts. Credit card issuers, I point out, are earning enormous amounts of money in income from fees, penalties, and interest charges. As one expert said: The idea that companies are losing their shirts on bankruptcies is [just not true at all]. Mr. President, I ask unanimous consent that an article that appeared this morning in the Los Angeles Times be printed in the Record.

Mr. DODD. Taking the Bankruptcy Act goes back to the earliest days of our Republic. Article I, section 8 of the U.S. Constitution mandates that Congress pass laws dealing with bankruptcy. I believe our Founders did so because they realized there was inherent, fundamental value to allowing people who find themselves under difficult circumstances to be able to get out from underneath those circumstances, to discharge their responsibilities to the best extent possible, and then to get back on their feet again. That is a social value from which all Americans benefit. Now, will there be people who should have been far more responsible? Absolutely. But I happen to believe that the overwhelming majority of people who are forced to file for bankruptcy do so most reluctantly, only because there are no other avenues available to them which they can deal with their problems. We have with a responsibility, to remember what our Founders envisioned in article I, section 8, which calls upon Congress to pass bankruptcy legislation. I would like to add at the outset of these remarks, if I can, some general understanding of what is happening to American consumers and their indebtedness. First of all, in terms of household savings, in 1993, the savings rate was 4.3 percent of the gross domestic product nationally. In 2003, it was at 1 percent of gross domestic product. In the third quarter of 2004, savings rates were less than one-half of 1 percent of the gross domestic product. The national savings rate is declining rapidly in this country. At a time when we ought to be doing everything we can to encourage consumers to begin to save more, to participate in their own long-term financial needs, we are going in the exact opposite direction of where we ought to be heading in this country. Let me add, simultaneously, that according to the Federal Reserve Board, the United States has over $2.1 trillion in consumer debt. Consumer debt is truly skyrocketing. Almost one-half of that $2.1 trillion in consumer debt is revolving credit--to credit cards and home equity loans--nearly $800 billion of the $2.1 trillion. Our nation's savings rates are less than one-half of 1 percent of our gross domestic product--down from over 4 percent just a few years ago. Our nation's consumer debt has skyrocketed to $2.1 trillion, $800 billion of which is due to credit cards and home equity loans. We are going in the absolute wrong direction. The questions we ought to be asking as we debate and discuss this bankruptcy bill is: Does this legislation contribute in the 21st century to encouraging more savings? Does it do anything at all to try to reduce consumer debt? Does this bankruptcy bill do anything to reduce the number of bankruptcies and effect the underlying causes of bankruptcy. Certainly, consumers bear responsibility in terms of how they handle their money and the obligations they incur to those who extend them credit. However, there is a commensurate responsibility, I believe, on the part of those who extend credit. Creditors must make sure they are extending credit in a responsible way, with prudent underwriting standards. If they extend credit to those who can least afford it, charging them incredibly high rates and packed with hidden fees and costs, and with little or no expectation that they will have the ability to repay the debts incurred, then it seems to me that their charges of personal responsibility is wholly inappropriate. If we are going to try to increase savings rates and reduce consumer debt in this country, then we ought to ask ourselves whether or not this bill before us contributes to those important goals. Now, again, proponents of this legislation have wrapped themselves, if you will, in the flag of personal responsibility. The real purpose of the legislation, they argue, is to punish those who abuse our bankruptcy system, who raise costs to all consumers. The creditors are being forced, they argue, to raise prices on a variety of goods and services because of so-called bad actors who abuse the Bankruptcy Code. They would like us to believe that those bad actors are the real culprits behind why creditors, such as credit card issuers, are charging these incredibly high rates, using hidden, undisclosed fees and engaging in deceptive predatory practices. I would like to dispel, if I can, these myths. Nothing in this bill, in my view, is going to help consumers. Let me repeat that. Nothing in this legislation will help consumers. The legislation, I would argue, will only help creditors recover more money from debtors, most of whom have been forced to declare bankruptcy because of emergency medical expenses or due to the loss of a job or as a result of a divorce. Let me put up the second chart, if I can, to make that point for my colleagues and others who may be interested in this debate. We are told, again, that 46 percent--almost half--of the 1.5 million bankruptcies taken annually are as a result of illness. Mr. President, 46 percent as a result of illness, alone. I mentioned briefly at the outset the reason I have not been as engaged in this debate over the last 4 days is because of the arrival of my new daughter in the wee hours of Tuesday morning. As I went to the nursery to see my new daughter I looked across the hall of the hospital, located in Northern Virginia. I saw where the premature infants were being cared for in incubators, and I saw the families with their premature infants. Many of the families did not strike me as people living lavish lifestyles at all, struggling with a new infant who is in a very fragile condition inside an incubator. I do not need to tell anyone the costs associated with those type of medical challenges. I suspect, unfortunately, that a lot of these people do not have health insurance. As I watched them come in and out of that nursery to be with their newborn child in an incubator, I suspected that many of them are going to have costs far beyond anything they ever imagined. The idea, that somehow, we ought to penalize people because of a newborn in their life, who are going to have incredible increased costs, seems to me to be terribly wrongheaded. As I stated earlier, 46 percent, of the 1.5 million bankruptcies annually occur because of medical causes. Of the remaining 54 percent, we know the majority of that 54 percent is due to job loss and divorce in the country--not the lavish lifestyles of bad actors that the credit card companies would suggest. This legislation will injure honest, hard-working Americans, in my view, who fall on hard times through no fault of their own. Let's just take a few steps back, if we can. What is the reason we have bankruptcy laws? The reason we have a Bankruptcy Code is because life, sometimes, just deals people all across our country, regardless of who they are or where they come from, a bad hand. People get dealt a bad hand every now and then. And we happen to believe, as a society, it is important to give people a fresh start in our Nation, an opportunity to overcome the financial misfortunes that have struck them, such as those families I have just described that I watched with premature infants. This principle is so fundamental to our Nation that our Constitution expressly lists the establishment of uniform bankruptcy laws as a congressional responsibility. It seems that the Framers understood that society is better off if we can find an orderly way to allow people to pay off their debts to the best degree possible. It is critical to helping people to get back on their feet as productive citizens. Regrettably, that principle seems to suffer, in my view, at the hands of this legislation. Recent evidence supports the idea the vast majority of people who file for bankruptcy do so because of some financial crisis beyond their control that has plunged them into debt they cannot avoid. A recent study, conducted in early 2005 by a team of researchers at Harvard University, confirmed that nearly half of all people who file for bankruptcy protection do so because of medical or health reasons. The evidence shows that abusive filings are the exception, not the rule. The median income of the average American family filing for chapter 7 bankruptcy--what do my colleagues think it might be? What is the median income of the average family filing for bankruptcy, these lavish-lifestyle people out there? It is $20,000 a year. That is the average annual income of a person filing for bankruptcy--hardly people living lavish lifestyles. That is according to the General Accounting Office. The majority of the people who file for bankruptcy are single women who are heads of households, elderly people trying to cope with medical costs, and people who have lost their jobs or families whose finances have been complicated by divorce. For the most part we are talking about working people or elderly Americans on fixed incomes who have fallen on hard times and who need the protection of the Bankruptcy Act to help put them and their lives back together. It is also worth noting that based on the first three quarters of 2004, the personal bankruptcy rate actually decreased by 2.6 percent. According to the American Bankruptcy Institute, there were actually 50,000 fewer cases from September 2003 to September 2004 than there were in the previous 12-month period, which, of course, begs the question: If bankruptcy rates are falling, why is this legislation necessary? There is no smoke and there is certainly no fire except for maybe the millions of consumers who are being burned by abusive creditor practices. The impact this legislation would have on single-parent households is of particular concern to me. Single parents have one of the hardest jobs in America. Most work all day, prepare meals, keep house, help children with their homework, schedule doctor appointments, parent- teacher meetings, and extracurricular activities. Life is very hard for working single parents, and often financial assistance they receive in the form of alimony or child support is critical to keeping their families from falling into poverty. I believe sincerely that this legislation, if enacted, is going to frustrate the efforts of single- parent families to collect child support payments. I understand that the proponents of this bill believe they have treated single-parent families fairly. But what I worry about is the unintended but perfectly foreseeable consequence of allowing more debts to survive bankruptcy. Let me explain why and what is in this bill today. For more than 100 years, the Bankruptcy Code has given women and children an absolute preference over all others who have claims on a debtor's estate. Under the well-established rule, if a divorced person files for bankruptcy, the court doesn't require the person's ex-spouse or children to compete with creditors for the funds needed to pay child support and alimony. Instead, for 100 years, alimony and child support have been taken out of the debtor's monthly income first, and if there is anything left over, it is made available to commercial creditors. If there is nothing left over, the commercial or consumer debts are discharged, and the debtor's only remaining obligation is to the ex- spouse and his or her children. This legislation changes those rules for the first time in 100 years. For the first time we are going to make credit card and other consumer debts essentially nondischargeable so that while a divorced spouse would still be obligated to pay alimony and child support, his or her other unsecured debts remain intact. The proponents of the bill will say this does no harm to the divorced spouses or children because the ex-spouses are still at the front of the collection process. But there is, in my view, a huge practical difference between being first in line and being the only one in line. Under current law, nonsupport debts are often discharged and debtors can focus entirely on meeting their obligations to their children and current spouses. If this legislation becomes law, that will change for the first time in 100 years. Debtors will not be able to focus on their children; they will, as a matter of law, have to divert limited financial resources to pay back consumer creditors. I believe this change will inevitably lead to conflicts between commercial creditors and single parents who are owed support and alimony payments. Sure, they are going to be first in line, but single parents will be competing with large creditors, creditors who have teams of lawyers who are hired to use every imaginable tactic to see to it that they get their money first. That is what they are going to do. I promise, it is going to happen. I believe it is a mistake to make single parents compete with teams of lawyers from very well-heeled creditors for the money they need to clothe and feed and educate their children. That is a mistake, and we will regret it. I understand the perspective that says that all debts incurred should be paid. I don't fundamentally disagree with that. But when debtors simply cannot pay all of their debts, I believe that our laws should protect the interests of children and families first. Under this legislation, child support payments could very well be reduced in order to satisfy an unsecured commercial creditor. In my view, that change will place the well-being of children at a disadvantage and elevate the status of the unsecured creditor. Low-income children and families will be put at a practical disadvantage by this bill and will ultimately suffer greater economic deprivation because they cannot afford to compete with sophisticated creditors. I have talked a bit about who will be hurt by this legislation. Let me take a few minutes to focus on the big winners, if the legislation passes. The big winner, of course, is the credit card industry. Let me describe the current state of the credit card industry. In a time when access to credit is the easiest and cheapest, credit card companies are making more money than ever, bilking millions of American families by charging what would have been only a few years ago usurious rates and fees, engaging in a series of abusive and deceptive practices which will have drastic long-term consequences. At the same time they are getting more and more Americans deeper and deeper into debt. I have cited these statistics previously: $2.1 trillion, almost half of that coming from credit cards and home equity loans--the same creditors pushing bankruptcy legislation in Congress to make their debts nondischargeable in the event of a bankruptcy. In effect, we are becoming the collection agency for these companies. The old expression never had a more apt example: the credit card industry wants to have its cake and eat it, too. Credit card companies are charging consumers higher fees than ever before. In 1980, credit card fees alone raised $2.6 billion. In the year 2004, credit card fees alone raised over $24.4 billion--$2.6 billion 24 years ago to $24.4 billion. Fees alone. Proponents of this legislation argue that because of increasing default rates, the supposed work of those bad actors, the ones making $20,000 a year on average, credit card companies are being forced to charge more fees. In fact, the exact opposite is the truth. Consumer bankruptcies actually went down last year by nearly 3 percent, and default rates actually decreased. A recent American Banker article cites industry expert Robert Hammer, chairman of R.K. Hammer Investment Bankers, who said that the biggest factor in industrywide credit card industry improvement was the 20- basis-point drop in chargeoffs from the year 2003. So I ask again: If default rates are decreasing, why is this legislation necessary? The truth is, this is the best time in history to be in the credit card business. Last year over 5 billion solicitations were offered to consumers, which is nearly twice as many as only 8 years ago. Despite the assertions that the credit card industry is struggling because of bad consumer behavior, credit card companies have more money than they know what to do with. They are pumping out solicitations in search of new people who will only acquire more and more debt. Credit card companies are making record profits. Credit Card Management reported in May 2003 that it was the most profitable year ever for credit cards. At a time when interests rates are at historic lows, credit card rates have not followed suit. The industry is engaged in a series of deceptive and abusive practices to take advantage of consumers. Let me take a few moment to describe a few of these practices. I am not making this up. Credit card companies are finding more ways to effectively increase their income from rates and fees. Abusive practices such as misleading teaser rates which employ bait-and-switch tactics, hidden fees and penalties, and the universal default provisions buried in the fine print are standard operating procedures in the credit card industry today. One of these abuses, the so-called ``universal default'', which could more accurately be described as a predatory retroactive interest rate hike. This practice forces a credit card consumer in good standing--one who is paying his or her credit card bills on time--to have his interest rates retroactively jacked up 25 to 30 percent because of an unknown, irrelevant change in his or her spending patterns. The idea that credit card companies can charge an initial interest rate that would have in the past been outlawed as usurious, and then double or triple that rate for any reason it so chooses is plain wrong, in my view. If a phone bill is inadvertently mailed to the wrong address or you are disputing an amount of a bill and it is not paid on time, does the mortgage rate on your house go up? Of course not. But it does with the credit card industry. We should stop this practice. At a minimum--and I will offer an amendment shortly--we should make any increase in the rates prospective, not retroactive. Let me explain why. If you enter into a agreement with a credit card company, and the established rate is set at 15 percent. Despite the fact that you continue to make your monthly payments on time, without exception, you can have your interest rate unexplainably raised. This inexplicable rate hike can occur for whatever reason the creditor sees fit. You have an argument with your automobile company and you decide to withhold a car payment, or you are having a debate with the utility company, so you hold back on your utility bill--under the law today, the credit card company can automatically increase your rates. And to add insult to injury, this new rate retroactively applies for the goods you have already purchased. I think this practice is completely uncalled for. But if you are going to allow for rates to go up, at a minimum they ought to be prospective, on future purchases, I would, frankly, like to eliminate it altogether, but I don't think enough people here would support that. At the very least, if you entered into a contract at 15 percent and if you are suddenly forced to pay a higher interest rate, it ought to be on prospective purchases, not to things that you may have bought 1 or 2 years ago. That is patently wrong, and I will offer an amendment to implement this policy. There is a second practice: credit card companies are focusing on customers who pay their bills on time. Credit card issuers are now providing incentives or rewards to customers for not paying their bills. They get a reward for not paying their bills. They offer up to 3 percent cash back on all credit card purchases, but only during the month when the credit card holder doesn't pay off his or her monthly balance. We have this consumer debt mounting by the hour, and we have credit card companies offering rewards to those who don't pay on time and they are cutting off the card for those who do. It is absolutely incredible. That underscores how important it is to the credit card industry that consumers get in debt and stay in debt. There are 51 million households that carry balances on the credit cards at an average balance of $11,944. That is the average amount of debt families carry on their credit cards. The current average interest rate is running at about 13 percent. This is at a time when we have the lowest interest rates at 3, 4 percent and we have 13 percent credit card charges. Each of those families is paying credit card interest, on average, of 15 percent a year. Some are having their credit cards cancelled because they simply pay all of their outstanding debt every month. Imagine that. You are paying your bills on time and the credit card company triples your interest rate or cancels your card. In fact, the credit card industry calls you a ``deadbeat'' if you pay off your entire balance every month. Why do they call you a deadbeat? The credit card industry has a vested interest to keep you in debt. Failure to do so affects their bottom line. They don't like people to pay off their monthly balances. You could lose your credit card for doing that. As I have said earlier, the real purpose of this legislation is to help credit card companies make more money. I am not opposed to them making their money, but I think we have a higher obligation here to see that these companies are prevented from engaging in abusive and predatory practices that run contrary directly to stated national goals of increasing savings rates and reducing consumer debt. I have given you some brief insight into some of the abusive practices of the credit card industry. I would now like to focus on what I believe to be the most egregious trend in the industry, which is targeting our Nation's most vulnerable customers. One of the most troubling developments is the hotly contested battle between credit card issuers to sign up new customers, and the aggressive way they have targeted people under the age of 21, particularly college students. Solicitations going to this age group have become incredibly intense. First, it is one of the few market segments in which every year 25 to 30 percent of the undergraduates are fresh faces entering their first year of college. Second, it is an age group in which brand loyalty can be readily established. Most people hold on to their first credit card for up to 15 years, which, by the way, is probably the amount of time it takes to dig out of the amount of debt they have incurred while in their teens. Let me share this with my colleagues. It is somewhat amusing, but it is also rather sad. This is a letter that was sent to a 7-year-old child of one of the people in my office. I have crossed out the family name. He has a 7-year-old son. He was amazed to find a brand new American Express card being issued to his son. The card came as a result--according to the offer--of this young elementary schooler's ``excellent credit history.'' It says: You should know about this milestone that you have achieved. With your excellent financial record, our decision was very simple. We want you as a card member. Imagine, a 7-year-old. It reads: ``You have the flexibility of a no preset spending limit''--a 7-year-old. There are no limits on how much you can spend on this credit card. He has amply demonstrated his financial responsibility, according to this letter. He has earned this recognition to receive an American Express card at age 7. This type of solicitation happens more and more every single day and yet we need to focus on personal responsibility and not corporate responsibility. There are 5 million solicitations that go out every year, many going to young children in our society. Obviously, we are talking not just about 7-year-olds here but also to college-age persons. They are vulnerable, these younger people in our society. To extend them large amounts of credit, with no limits, is an act of incredible irresponsibility. Again, I agree that consumers have a duty to be responsible. I will take a back seat to no one in arguing that ought to be the case. However, there needs to be a sense of balance about this. If you are expecting the consumer to be responsible, the issuer of the credit card also has to be responsible. They lack total responsibility when it comes to these solicitations. I have an amendment that I will offer shortly that places new requirements on credit card companies who solicit to persons under the age of 21. It requires if you are under the age of 21, either demonstrate that you can pay--a lot of people under 21 can pay because they hold jobs, they have made money, and they have saved. Or have somebody cosign--a parent, guardian or other responsible party--the application to get the credit card, Or lastly, the completion of certified credit counseling course. Any one of those three, not all three. It is a very simple and prudent requirement to ask for before issuing credit cards. This ought to be plain common sense, in my view. We have an obligation to protect and educate our young people. The next generation of American leaders deserves no less than reining in the irresponsible practices of the credit card industry that just pushes these cards out. In fact--and I will touch on this later-- universities actually get money into their coffers if they will promote students signing up for credit cards. There are actually fees that come to the universities as a result of the indebtedness of their students. It seems to me we ought to be thinking twice and thinking hard about those practices. Credit card companies are running roughshod over millions of Americans and their families. We should be passing legislation that prevents these types of practices, not padding the credit card industry's pockets, in my view. The credit card issuers seem to have forgotten the correlation between high interest rates and unsecured debt. Traditionally, unsecured credit issued without collateral and relying only on the integrity of the borrower has a higher default rate. As a result, credit issuers are allowed to charge a higher interest rate in order to make up for expected losses from those higher default rates. However, this legislation begins to change this deal, changing the Bankruptcy Code to make unsecured debt nondischargeable in the event of a bankruptcy. Record fees, record abuses, record profits, and a record number of Americans are being taken advantage of. I urge my colleagues to reject this legislation. Amendment No. 52

Mr. DODD. As I touched on briefly before, this amendment seeks to protect the most vulnerable of our nation's consumers--persons under the age of 21. According to Dr. Robert Manning, a professor at Rochester Institute of Technology, one of the fastest growing groups of bankruptcy filers are people under the age of 25. In fact, the number of bankruptcies among those under the age of 25 is more than 6 times that of only 5 years ago, according to the American Bankruptcy Institute. One of the most troubling developments in the hotly contested battle of credit card issuers to sign up new customers has been the aggressive way in which they target people under the age of 21. Solicitations to this group have become more intense for a variety of reasons which I have mentioned already. Obviously, we know about consumer loyalties. It is also an age group in which brand loyalty can be established. However, some credit card issuers have gone too far. Again, I am not opposed to people under the age of 21 having credit cards. Credit cards, are a great asset to a lot of people. I am not opposed to them, but they must be issued and used responsibly. I mentioned the letter earlier of the 7-year-old, which is just plain ridiculous. What also worries me is what is happening with these younger people on college campuses around the country. Credit card issuers are deeply involved in the business of enticing colleges and universities to help promote their products. Many colleges receive as much as 1 percent of all student charges from credit card issuers in return for marketing or affinity agreements. Even those colleges that do not enter into such agreements are making money. Robert Bugai, the President of the College Marketing Intelligence, told the American Banker that colleges charge up to $400 per day for each credit card company that sets up a table on campus. That can run into tens of thousands of dollars by the end of just one semester. A ``60 Minutes II'' piece a number of years ago vividly illustrated the impact that credit card debt is having on college students. A crew from the show was on a major public university, and with the use of hidden cameras filmed vendors pushing free T-shirts, hats, and other enticements for credit applications. The ``60 Minutes'' program revealed that the university was being paid $13 million over 10 years by a credit card company for the right to have a presence on campus and to use the university logo on its cards. This public university was making money off its students who used credit cards, the report said. As part of the agreement, the university receives four-tenths of a percent of each purchase made with the cards. Unbelievably, this university has a vested interest in getting their students into as much debt as possible. Again, we have kids who are going--the anecdotal stories of the debt they are incurring is just staggering. We have watched it actually almost double. Debt among this group has gone from around $1,800 a year to over $3,000 a year. Again, this amendment requires one of three things. Firstly, it requires that one can prove that they have the financial resources to repay debts incurred. That is simple enough. Or have someone cosign the application, or just agree to take a short course in credit counseling. Any one of those three things and a person gets their card. To push these cards out with no spending limits on them at all, knowing what is inevitably going to happen--bankruptcy--is irresponsible. Again, I understand why the credit card companies want to do it. I do not understand why we want to allow them to do it in such an unfettered way, knowing what we know now. If they were doing this for the first time and we did not know the implications or the effects of their actions, I could understand maybe why some people would be willing to go along with it. But we now know what is happening. We are watching consumer debt among young people double over the last several years. Why would we not just say, look, prove you can pay your debts, prove you have some financial means, have someone cosign with you, or be willing to take a credit counseling course? These are not heavy burdens to make. It seems to me the very least we could do, again, acting responsibly. If this bill says consumers must act more responsibly, should we not commensurately ask the industry to act responsibly as well? When universities are collecting $13 million over 10 years in fees to allow a credit card company to be on their campus, and they are getting four-tenths of 1 percent on every purchase made by a student on campus, that is a university encouraging debt among its kids. That is just wrong, in my view. So we are requiring a cosigner, proving a person has a source of income, or take some counseling so the kids have some idea of what they are getting into. Again, just some basic statistics, and I will wrap up. Our personal savings rate is at an all-time low. The last quarter in the year 2004, less than one-half of 1 percent was the national annual savings rate. That is down from 4\1/2\ percent 10 years ago. It was at 1 percent last year. We are going in the wrong direction in terms of encouraging people to save. Consumer debt is now at $2.1 trillion, and almost half of that, $800 billion, is credit card debt--$2 billion alone in the month of December. The consumer debt is mounting, and there needs to be a commensurate sense of responsibility by these credit card companies. They are making incredible profits with interest rates at 18, 25, 30 percent, when one can borrow money to buy a home for 4\1/2\ or 5 percent. Yet credit card companies are charging these incredibly high rates, making staggering profits. The average income of a person taking the bankruptcy act is $20,000 a year. The reason they are taking the bankruptcy act is because of medical expenses, job loss, or divorce. These are not people living lavishly. Default rates are actually dropping. What is the justification and rationale for a bill that makes it easier for these credit card companies to collect and prevents consumers from getting back on their feet again? Particularly disturbing to me is this change, after 100 years of law, where we sought to protect single women raising children with child support and alimony payments by allowing the discharge of these other obligations and seeing to it that they would focus on meeting their family obligations. We are now going to have the credit card companies competing with these children and these families, and I do not even have to say who is going to win that battle. A team of lawyers representing very rich credit card companies are always going to beat that family out there. They are going to get that father, that husband, or that woman, to pay their unsecured debts to that credit card company, and that child and that family will lose. Why, after 100 years, are we changing the law protecting families and children? I think that is a huge mistake. I think it is going to come back to cause us a great deal of pain. This bill needs fundamental change. I wish people would take time and look at these things. I understand there is a sentiment to reject all amendments, but we ought to ask these companies to act more responsibly. We are not going to do it, but I think, in time, we are going to pay an awful price. When we ought to be encouraging more personal savings, and when we ought to be reducing consumer debt, we are getting more consumer debt and less and less personal savings. We are allowing credit card companies to gouge consumers and never let average people who get into trouble--and, again, a lot of them, through no fault of their own--to get back on their feet again. That is what we ought to be trying to do. When it is the appropriate time I will ask for votes on these amendments. I realize it will not be until next week. I have taken a lot of time, and I express my appreciation to my friend from Alabama who has been very patient, listening to me going on about this bill, and I thank the Presiding Officer for his patience as well in listening to this, and I yield the floor.

Mr. DODD

Mr. DODD. I ask unanimous consent for the duration of the debate and the votes on S. 256, Beth Meagher of my staff be granted privileges of the floor.

Mr. DODD. I ask unanimous consent for the duration of the debate and the votes on S. 256, Beth Meagher of my staff be granted privileges of the floor.

Mr. DODD

Mr. DODD. Mr. President, I rise today to introduce legislation, the Credit CARD Act of 2005 (the Credit Card Accountability Responsibility and Disclosure Act of 2005), designed to protect our Nation's consumers from the predatory practices of the credit card industry. The Credit CARD Act is substantially the same as legislation I previously introduced in the 108th Congress. As the Senate considers bankruptcy reform legislation, which I believe will adversely impact consumers and inappropriately reward the credit card industry, the Credit CARD Act is needed now more than ever before. I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. DODD

Mr. DODD. Mr. President, I rise today to introduce legislation, the Credit CARD Act of 2005 (the Credit Card Accountability Responsibility and Disclosure Act of 2005), designed to protect our Nation's consumers from the predatory practices of the credit card industry. The Credit CARD Act is substantially the same as legislation I previously introduced in the 108th Congress. As the Senate considers bankruptcy reform legislation, which I believe will adversely impact consumers and inappropriately reward the credit card industry, the Credit CARD Act is needed now more than ever before. I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. DODD

Mr. DODD. Mr. President, I rise today to introduce the Fair Access to Clinical Trials, FACT, Act. I want to begin by thanking Senator Grassley, Senator Johnson, and Senator Wyden for joining me in introducing this legislation. Our bill will create an electronic databanks for clinical trials of drugs, biological products, and medical devices. Such a databank will ensure that physicians, researchers, the general public, and patients seeking to enroll in clinical trials have access to basic information about those trials. It will require manufacturers and other researchers to reveal the results of clinical trials so that clinically important information will be available to all Americans, and physicians will have all the necessary information to make appropriate treatment decisions for their patients. Events of the past year have made it clear that such a databank is needed. First, serious questions were raised about the effectiveness and safety of antidepressants when used in children and youth. It has now become clear that the existing data indicates that these drugs may very well put children at risk. However, because the data from antidepressant clinical trials was not publicly available, it took years for this risk to be realized. In the meantime, millions of children have been prescribed antidepressants by well-meaning physicians. While these drugs undoubtedly helped many of these children, they also led to greater suffering for others. Recently, it has been suggested that the risk of antidepressants might even extend beyond children. The news is similarly disturbing for a popular class of painkillers known as Cox-2 inhibitors. These medicines, taken by millions of Americans, have been associated with an increased risk of cardiovascular adverse events, such as heart attack and stroke. It has been suggested that one of these medicines, which has since been pulled from the market, may be responsible for tens of thousands of deaths. Unfortunately, antidepressants and Cox-2 inhibitors are just two examples of a story that has become all too common. It has been suggested that negative data might actually have been suppressed; and if this is discovered to be the case, those responsible should be dealt with harshly. However, because of what is known as ``publication bias,'' the information available to the public and physicians can be misleading even without nefarious motives. The simple fact is that a study with a positive result is far more likely to be published, and thus publicly available, than a study with a negative result. Physicians and patients hear the good news, but rarely the bad news. In the end, the imbalance of available information hurts patients. Our bill would correct the imbalance of information, and prevent manufacturers from suppressing negative data. It would do so by creating a two-part databank, consisting of an expansion of clinicaltrials.gov--an existing registry that is operated by the National Library of Medicine, NLM--and a new database for clinical trial results. Under the FACT Act, the registry would continue to operate as a resource for patients seeking to enroll in clinical trials for drugs and biological products intended to treat serious or life-threatening conditions--and for the first time, it would also include medical device trials. The new results database would include all trials, except for preliminary safety trials, and would require the submission of results data. Our legislation would enforce the requirement to submit information to the databank in two ways. First, by requiring registration as a condition of Institutional Review Board, IRB, approval, no trial could begin without submitting preliminary information to the registry and database. This information would include the purpose of the trial, the estimated date of trial completion, as well as all of the information necessary to help patients to enroll in the trial. Once the trial is completed, the researcher or manufacturer would be required to submit the results to the database. If they refuse to do so, they would be subject to monetary penalties or, in the case of federally funded research, a restriction on future funding. It is my belief that these enforcement mechanisms will ensure broad compliance. However, in the rare case where a manufacturer does not comply, this legislation also gives the Food and Drug Administration, FDA, the authority to publicize the required information. Let me also say that any time you are collecting large amounts of data and making it public, protecting patient privacy and confidentiality must be paramount. Our legislation would in no way threaten that privacy. The simple fact is that under this bill, no individually identifiable information would be available to the public. I believe that the establishment of a clinical trials databank is absolutely necessary for the health and well-being of the American public. But I would also like to highlight two other benefits that such a databank will have. First, it has the potential to reduce health care costs. Studies have shown that publication bias also leads to a bias toward new and more expensive treatment options. A databank could help make it clear that, in some cases, less expensive treatments are just as effective for patients. In addition, a databank will ensure that the sacrifice made by patients who enroll in clinical trials is not squandered. Many patients would be less willing to participate in trials if they understood that the data are unlikely to be made public if the results of the trial are negative. We owe it to patients to make sure that their participation in a trial will benefit other individuals suffering from the same illness or condition. The problems associated with publication bias have recently drawn more attention from the medical community, and there is broad consensus that a clinical trials registry is one of the best ways to address the issue. Accordingly, the American Medical Association, AMA, has recommended the creation of such a databank, and the major medical journals have established a policy that they will only publish the results of trials that were registered in a public database before the trial began. Our legislation meets all of the minimum criteria for a trial registry set out by the International Committee of Medical Journal Editors. To its credit, the pharmaceutical industry has also acknowledged the problem, and has created a database to which manufacturers can voluntarily submit clinical trials data. I applaud this step. However, if our objective is to provide the public with a complete and consistent supply of information, a voluntary database is unlikely to achieve that goal. Some companies will provide information, but others may decide not to participate. We need a clinical trials framework that is not just fair to all companies, but provides patients with peace of mind that they will receive complete information about the medicines they rely on. The American drug industry is an extraordinary success story. As a result of the innovations that this industry has spawned, millions of lives have been improved and saved in our country and around the globe. Because of the importance of these medicines to our health and well- being, I have consistently supported sound public policies to help the industry to succeed. This legislation aims to build upon the successes of this industry, and help ensure that the positive changes to our health care system that prescription drugs have brought are not undermined by controversies such as the ones now surrounding antidepressants and Cox-2 inhibitors, which are at least in part based on a lack of public information. This bill will help ensure that well- informed patients will use new and innovative medicines. I look forward to working with industry, physicians, the medical journals, patient groups, and my colleagues--including the Chairman and the Ranking Member of the Health, Education, Labor, and Pensions Committee, Senator Enzi and Senator Kennedy--to move this legislation forward. This bill has already been endorsed by the National Organization for Rare Disorders, Consumers Union, the Elizabeth Glaser Pediatric AIDS Foundation, the American Academy of Child and Adolescent Psychiatry, the American Psychiatric Association, the New England Journal of Medicine, and the National Women's Health Network. I thank these organizations for lending their expertise as we crafted this legislation. The creation of a clinical trials databank is a critical step toward ensuring the safety of drugs, biological products, and devices in this country--but it should not be the end of our efforts. I believe that other steps are necessary to fully restore patient confidence in the safety of the medicines they rely on. I have already announced my intention to introduce another piece of legislation that will create an Office of Patient Protection within the FDA, which will be responsible for ensuring the safety of prescription drugs once they are on the market. I look forward to introducing this bill in the coming weeks. Clinical trials are critical to protecting the safety and health of the American public, and for this reason, trial results must not be treated as information that can be hidden from scrutiny. Recent events have made it clear that a clinical trials databank is needed. Patients and physicians agree that such a databank is in the interest of the public health. I urge my colleagues to support this legislation, and I am hopeful that it will become law as soon as possible. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. DODD

Mr. DODD. Mr. President, I rise today to introduce the Fair Access to Clinical Trials, FACT, Act. I want to begin by thanking Senator Grassley, Senator Johnson, and Senator Wyden for joining me in introducing this legislation. Our bill will create an electronic databanks for clinical trials of drugs, biological products, and medical devices. Such a databank will ensure that physicians, researchers, the general public, and patients seeking to enroll in clinical trials have access to basic information about those trials. It will require manufacturers and other researchers to reveal the results of clinical trials so that clinically important information will be available to all Americans, and physicians will have all the necessary information to make appropriate treatment decisions for their patients. Events of the past year have made it clear that such a databank is needed. First, serious questions were raised about the effectiveness and safety of antidepressants when used in children and youth. It has now become clear that the existing data indicates that these drugs may very well put children at risk. However, because the data from antidepressant clinical trials was not publicly available, it took years for this risk to be realized. In the meantime, millions of children have been prescribed antidepressants by well-meaning physicians. While these drugs undoubtedly helped many of these children, they also led to greater suffering for others. Recently, it has been suggested that the risk of antidepressants might even extend beyond children. The news is similarly disturbing for a popular class of painkillers known as Cox-2 inhibitors. These medicines, taken by millions of Americans, have been associated with an increased risk of cardiovascular adverse events, such as heart attack and stroke. It has been suggested that one of these medicines, which has since been pulled from the market, may be responsible for tens of thousands of deaths. Unfortunately, antidepressants and Cox-2 inhibitors are just two examples of a story that has become all too common. It has been suggested that negative data might actually have been suppressed; and if this is discovered to be the case, those responsible should be dealt with harshly. However, because of what is known as ``publication bias,'' the information available to the public and physicians can be misleading even without nefarious motives. The simple fact is that a study with a positive result is far more likely to be published, and thus publicly available, than a study with a negative result. Physicians and patients hear the good news, but rarely the bad news. In the end, the imbalance of available information hurts patients. Our bill would correct the imbalance of information, and prevent manufacturers from suppressing negative data. It would do so by creating a two-part databank, consisting of an expansion of clinicaltrials.gov--an existing registry that is operated by the National Library of Medicine, NLM--and a new database for clinical trial results. Under the FACT Act, the registry would continue to operate as a resource for patients seeking to enroll in clinical trials for drugs and biological products intended to treat serious or life-threatening conditions--and for the first time, it would also include medical device trials. The new results database would include all trials, except for preliminary safety trials, and would require the submission of results data. Our legislation would enforce the requirement to submit information to the databank in two ways. First, by requiring registration as a condition of Institutional Review Board, IRB, approval, no trial could begin without submitting preliminary information to the registry and database. This information would include the purpose of the trial, the estimated date of trial completion, as well as all of the information necessary to help patients to enroll in the trial. Once the trial is completed, the researcher or manufacturer would be required to submit the results to the database. If they refuse to do so, they would be subject to monetary penalties or, in the case of federally funded research, a restriction on future funding. It is my belief that these enforcement mechanisms will ensure broad compliance. However, in the rare case where a manufacturer does not comply, this legislation also gives the Food and Drug Administration, FDA, the authority to publicize the required information. Let me also say that any time you are collecting large amounts of data and making it public, protecting patient privacy and confidentiality must be paramount. Our legislation would in no way threaten that privacy. The simple fact is that under this bill, no individually identifiable information would be available to the public. I believe that the establishment of a clinical trials databank is absolutely necessary for the health and well-being of the American public. But I would also like to highlight two other benefits that such a databank will have. First, it has the potential to reduce health care costs. Studies have shown that publication bias also leads to a bias toward new and more expensive treatment options. A databank could help make it clear that, in some cases, less expensive treatments are just as effective for patients. In addition, a databank will ensure that the sacrifice made by patients who enroll in clinical trials is not squandered. Many patients would be less willing to participate in trials if they understood that the data are unlikely to be made public if the results of the trial are negative. We owe it to patients to make sure that their participation in a trial will benefit other individuals suffering from the same illness or condition. The problems associated with publication bias have recently drawn more attention from the medical community, and there is broad consensus that a clinical trials registry is one of the best ways to address the issue. Accordingly, the American Medical Association, AMA, has recommended the creation of such a databank, and the major medical journals have established a policy that they will only publish the results of trials that were registered in a public database before the trial began. Our legislation meets all of the minimum criteria for a trial registry set out by the International Committee of Medical Journal Editors. To its credit, the pharmaceutical industry has also acknowledged the problem, and has created a database to which manufacturers can voluntarily submit clinical trials data. I applaud this step. However, if our objective is to provide the public with a complete and consistent supply of information, a voluntary database is unlikely to achieve that goal. Some companies will provide information, but others may decide not to participate. We need a clinical trials framework that is not just fair to all companies, but provides patients with peace of mind that they will receive complete information about the medicines they rely on. The American drug industry is an extraordinary success story. As a result of the innovations that this industry has spawned, millions of lives have been improved and saved in our country and around the globe. Because of the importance of these medicines to our health and well- being, I have consistently supported sound public policies to help the industry to succeed. This legislation aims to build upon the successes of this industry, and help ensure that the positive changes to our health care system that prescription drugs have brought are not undermined by controversies such as the ones now surrounding antidepressants and Cox-2 inhibitors, which are at least in part based on a lack of public information. This bill will help ensure that well- informed patients will use new and innovative medicines. I look forward to working with industry, physicians, the medical journals, patient groups, and my colleagues--including the Chairman and the Ranking Member of the Health, Education, Labor, and Pensions Committee, Senator Enzi and Senator Kennedy--to move this legislation forward. This bill has already been endorsed by the National Organization for Rare Disorders, Consumers Union, the Elizabeth Glaser Pediatric AIDS Foundation, the American Academy of Child and Adolescent Psychiatry, the American Psychiatric Association, the New England Journal of Medicine, and the National Women's Health Network. I thank these organizations for lending their expertise as we crafted this legislation. The creation of a clinical trials databank is a critical step toward ensuring the safety of drugs, biological products, and devices in this country--but it should not be the end of our efforts. I believe that other steps are necessary to fully restore patient confidence in the safety of the medicines they rely on. I have already announced my intention to introduce another piece of legislation that will create an Office of Patient Protection within the FDA, which will be responsible for ensuring the safety of prescription drugs once they are on the market. I look forward to introducing this bill in the coming weeks. Clinical trials are critical to protecting the safety and health of the American public, and for this reason, trial results must not be treated as information that can be hidden from scrutiny. Recent events have made it clear that a clinical trials databank is needed. Patients and physicians agree that such a databank is in the interest of the public health. I urge my colleagues to support this legislation, and I am hopeful that it will become law as soon as possible. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. DODD

Mr. DODD. Mr. President, I rise today to say a few words about a very important speech that was presented, on January 25, to the Organization of American States, OAS, by former President Jimmy Carter. Broadly speaking, former President Carter's speech was about the promise and perils of democracy in our hemisphere. In my view, no topic could be more relevant. Our hemisphere has come a long way over the past 30 years--in no small part due to the efforts of Jimmy Carter. From the beginning, he realized the importance of the OAS in our hemisphere, and he demonstrated this understanding by addressing every OAS General Assembly meeting held in Washington during his presidency. He spearheaded the promotion of human rights, and his tireless work contributed to the establishment of the Inter-American Convention on Human Rights. That important document has encouraged greater civilian participation and helped facilitate the transition in many countries from rule by military dictator to that of democratically elected government. Simply put, Jimmy Carter's efforts sent a clear message throughout the hemisphere that the U.S. not only valued democracy but was committed to ensuring that people of all backgrounds had a stake in emerging democracies in their countries. Indeed, the InterAmerican Democratic Charter, which enjoyed broad support, was signed on the fateful day of September 11, 2001, and stands in stark contrast to the illiberal forces at work in areas around the world. The message of that document--that OAS member nations would stand together to protect democracy--and the wide support it enjoyed prove how much progress can be made when the U.S. invests time and effort in our hemisphere. Together, we've made tremendous progress over these past 30 years. However, our work in the hemisphere is far from over. We must continue to end impunity, protect emerging democratic institutions, and strengthen the InterAmerican Democratic Charter. Former President Carter continues to work toward these noble ends, and others, for the good of the U.S. and for the good of people from Canada to Argentina and across the world. I congratulate him on his efforts, on the magnificent work of the Carter Center, and on the vision he layed out in his January 25 statement before the OAS. I ask unanimous consent that his statement be printed in the Record.

Mr. DODD

Mr. DODD. Mr. President, I rise today to speak in support of S. 306, the Genetic Information Nondiscrimination Act. Before I talk about why this bill is so crucial, I want to thank the chairman and ranking member of the HELP Committee, Senator Enzi and Senator Kennedy, for their efforts on this bill, and for making it one of their first priorities in the 109th Congress. Their action sends a strong signal about the importance of this legislation. I would be remiss if I did not also mention the dedication to this issue shown by our former Democratic leader, Senator Tom Daschle. We are in a position to pass this bill today as a direct result of the work done by Senator Daschle. Many of us, on both sides of the aisle, saw the need several years ago for legally enforceable rules to maximize the potential benefits of genetic information--and minimize its potential dangers. I have worked on this issue with many of my colleagues since the 105th Congress. I have chaired a hearing in the HELP Committee, and I have introduced legislation with several of my colleagues, notably Senator Daschle, Senator Kennedy, and Senator Harkin, going back to the 106th Congress. The legislation that we will consider today is a bipartisan compromise between our bill, and a similar bill introduced by Senator Snowe and others. It represents a culmination of the efforts of many of us to establish such rules. It is an enormous step forward, and I would like to acknowledge the hard work of everyone who was involved in crafting this legislation. Over the past decade, the science of genetics has developed at an astonishing pace. The mapping of the human genome is undoubtedly one of the greatest scientific achievements of this generation. We have not even completely grasped the wide array of potential benefits that may come from our newfound genetic knowledge. Certainly, the impact on our health will be profound. Doctors will be able to read our unique genetic blueprints and predict the likelihood of developing diseases such as cancer, Alzheimer's, or Parkinson's. They will also be able to use an individual's genetic information to develop treatments for these same diseases, and target individuals with the treatment that will work best for them. This is not science fiction. It is already beginning to happen. For all the promise of the genetic age, there is also an inherent threat. Science has outpaced the law and Americans are worried, and rightly so, that their genetic information will be used--not to improve their health--but to deny them health insurance or employment. There is no information more personal and private than genetic information--and no information more worthy of special protection. Our genetic code is the very blueprint of our selves. It is with us from birth, and to some extent it determines who we will become. What an incredibly powerful tool, with its vast potential to help us live healthier lives. But the nature of genetic information also makes it dangerous to the individual if used incorrectly. This bill provides significant new protections against the misuse of genetic information. It ensures that Americans who are genetically predisposed to health conditions will not lose or be denied health insurance, jobs, or promotions based on their genetic makeup. Reaching an agreement on this legislation means that our laws dealing with genetic information can begin to catch up to the reality of our technological capability in the field. With these protections in place, individuals need not feel reluctant to get the tests that may save or improve their lives. Although the Americans with Disabilities Act, ADA, and the Health Insurance Portability and Accountability Act, HIPAA, took important steps towards preventing genetic discrimination, this legislation is more specifically tailored to prohibiting its misuse. Health plans and health insurance issuers will not be allowed to underwrite, determine premiums, or decide on eligibility for enrollment based on genetic information. Employers will not be allowed to alter hiring practices based on genetic information. The American public can feel secure in the knowledge that their genetic blueprint will not be used to harm them, that a genetic marker indicating a possible illness later in life will not cause them to lose a job or health insurance. Like any compromise, this bill is not perfect. In particular, while it poses some important limitations on the collection of personal genetic information by insurance companies, it would allow them to collect this information, without consent, once an individual is enrolled in a health plan. While insurers are expressly prohibited from using this information for the purposes of underwriting, I am concerned that once they have this information, it may be difficult to control how it is used and who has access to it. We all know from experience that the difficulty of protecting information increases exponentially with each additional person who has access to that information. As this bill becomes law--and I sincerely hope it will--I will monitor closely how it is implemented, and the extent to which privacy is protected. We may need to revisit this issue in the future. Mr. President, despite this shortcoming, I support this bill, as it represents a vast improvement over current law in many ways. I hope that it will become law in the very near future. This Chamber passed a similar bill last year by a vote of 95 to 0. Unfortunately, the House did not take up this important legislation. I urge them to do so as soon as possible. We all should feel free to make our health care decisions based on our health care needs, not based on fear. Today, we are close to making that goal a reality.

Mr. DODD

Mr. DODD. Mr. President, I rise this afternoon to discuss briefly the nomination of Judge Michael Chertoff, of New Jersey, to be Secretary of Homeland Security. I thank our colleagues on the Homeland Security and Governmental Affairs Committee, especially Chairwoman Susan Collins and my dear friend and colleague from Connecticut, Joseph Lieberman, for their close consideration of this nomination. The task of reviewing the nominee for Secretary of Homeland Security is a difficult one, and the committee did a fine job. I have reviewed the credentials of Judge Chertoff. They are impressive. In a legal career spanning over a quarter of a century, Judge Chertoff has shown a respectable dedication to public service. In my view, he has also demonstrated an ability effectively to manage a variety of security issues. For these reasons, I believe that Judge Chertoff is qualified and capable to serve as Secretary of the Department of Homeland Security. I plan on voting for his nomination. The job for which Judge Chertoff is being nominated is a challenging one. In this post 9/11 era, the Secretary of Homeland Security bears the primary responsibility of ensuring the safety of all Americans from threats that range from terrorist attacks to natural phenomena. In order to meet this responsibility, the Secretary must oversee 22 separate agencies and 180,000 employees, all of whom carry out critical daily duties that include safeguarding our borders, securing our domestic infrastructure, and providing emergency disaster assistance. We all know that success in carrying out these duties will rest on the ability of the Secretary to coordinate and manage the resources at his disposal. They are huge. If confirmed, Judge Chertoff will unfortunately find that the current resources at his disposal are inadequate to ensure the operation of an effective Department of Homeland Security. I strongly agree with several of my colleagues on the Homeland Security and Government Affairs Committee who argue that more must be done to improve the Department's ability to identify security threats and to respond to these threats in an effective and appropriate manner. I agree that the Department of Homeland Security must be given adequate resources to address the plethora of security vulnerabilities that continue to plague our borders, airports, seaports, transportation systems, utility networks, and financial networks. I also agree that more work must be done to develop and implement a Government-wide strategy on homeland security activities, and to devise specific plans of action for specific threats. Furthermore, I strongly concur that more resources must be provided to our first responders--the millions of brave men and women who make up our front lines of defense at home. For any homeland security response to be fully effective and successful, our firefighters, law enforcement personnel, and emergency response teams require the most updated equipment and training to function. Regrettably, the administration's fiscal year 2006 budget deeply cuts these and other initiatives related to homeland security. All of these challenges that I mention demand immediate and long-term investments. While I applaud the work that has already been done to enhance our domestic security since 9/11, I remain, as many of my colleagues do, deeply disturbed by the administration's continued disinclination to invest adequately in these activities. As more gaps in our security are uncovered and exploited, and as more work is being done to enhance our capabilities in identifying closing these gaps, the Bush administration's policy has been to provide less resources, including unthinkable cuts of $615 million to State homeland security initiatives and our first responders. How can we fully expect to be safe as a nation if the very people who are committed to our safety are deprived of the vital resources that ensure our safety? In his testimony before the Homeland Security and Governmental Affairs Committee, Judge Chertoff indicated his determination to `` . . . improve our technology, strengthen our management practices, secure our borders and transportation systems, and most important, focus each and every day on keeping America safe from attacks.'' I am encouraged by these remarks, and I hope Judge Chertoff's determination can allow him to meet the challenges, but he faces some awesome ones within the administration, if, in fact, these budget cut proposals are enacted into law. I am also encouraged by the remarks he made regarding the rights to due process that all Americans enjoy. In his testimony to the Homeland Security and Governmental Affairs Committee, Judge Chertoff said: I believe that we cannot live in liberty without security, but we would not want to live in security without liberty. I believe this position is noteworthy, especially in light of the report issued by the Department of Justice inspector general in 2003 that criticized the prolonged detention of hundreds of people-- primarily immigrants--of suspected ties to terrorism that were later deemed groundless. Judge Chertoff admitted that mistakes were made in the detention and treatment of these individuals--an admission rarely heard from this administration--and vowed to prevent them from happening again. The question for our country is not whether Judge Chertoff is the right man for the job--I believe he is--but whether Judge Chertoff will be given an impossible job by the President who nominated him. We surely cannot meet the needs of our homeland security apparatus on a tin-cup budget, just as we cannot meet the needs of our military, our schools, and our health care facilities. I find it troubling that--at the same time as it cuts support for police, firefighters, schoolchildren, and hospitals--this administration continues to view as sacrosanct the massive tax cuts worth $1.6 trillion that benefit only some of the most wealthy individuals in our Nation. Clearly, the President is not willing to ask any of these people--although I think many of them would be more than willing--to make the sacrifice for the well-being of our Nation. Yet, at the same time, the President is willing to tell firefighters, law enforcement personnel, and emergency response teams--people who risk their lives every day for our Nation--that not only are they going to get fewer resources each year, but they are required to do more with less. This severely skewed set of priorities is simply stunning. While it may be difficult for many of us to see this mismatch clearly today, I believe future historians who write about this period will harshly judge it as such. If confirmed, Judge Chertoff faces formidable and daunting challenges--challenges that must be overcome if we are to ensure the safety of this country and well-being of all Americans. I speak on behalf of all of my colleagues when I wish him the best in this very difficult endeavor he is willing to undertake. I am also here to discuss another issue raised by our colleague, Senator Carl Levin of Michigan. The issue concerns the repeated failure of this administration to provide the Senate with information necessary to carry out its constitutional responsibilities of giving advice and consent and conducting oversight of the executive branch. In a letter written by the Department of Justice to Senators Lieberman and Levin on February 7--just over a week ago--the Department of Justice claimed that an unredacted document related to the Chertoff nomination would not be provided to the Homeland Security and Governmental Affairs Committee because `` . . . it contains information covered by the Privacy Act . . . as well as deliberative process material.'' The assertion by the Department of Justice that their inability to comply rests on the Privacy Act is absurd and wholly unacceptable. As Senator Levin has stated--and I strongly agree with him in this-- the Privacy Act protects private individuals from having personal information released without their consent. In this case, the Department of Justice is using the Privacy Act to conceal the names of public officials who have engaged in Government activities at taxpayers' expense. That is precisely the kind of case in which Congress ought to have full knowledge of Government personnel and their activities in order to exercise its advice and consent responsibility fully. To deny the Senate information about what public officials are doing at taxpayers' expense is essentially to deny the American people their right to know what their Government is or is not doing in the name of its citizens. To deny the American people their right to know of their Government's actions is an abuse of not only the Privacy Act, it is an abuse of power, in my view. This may seem like a small matter to some, just one document. However, it should be noted that Senator Levin has precisely and carefully raised an issue that would be deeply disturbing to anyone who is committed to openness and accountability in our Government. I suggest to my colleagues that we are going to be seeing this issue arise over and over again if we as a body--all of us here--do not challenge it. I do not care what party is in the White House. If any administration starts making the case in the Executive Branch that the Privacy Act applies to Government personnel and Government documents that Congress may need to fulfill its Constitutional obligations, then a dangerous precedent will be set--one that I think we will deeply regret. This matter reflects an already persistent, almost obsessive preoccupation by the current administration with secrecy, thereby avoiding accountability to Congress and, of course, to the citizens we seek to represent. The examples of this preoccupation are almost too many to recite. One example that comes to mind is when Members of Congress and environmental organizations were unable to ascertain who--just the names--participated in the Vice President's energy task force, the group which laid the blueprints for the administration's current energy policy. Another example is the refusal of the recent nominee, now current Attorney General, to provide information to the Judiciary Committee pertaining to the development of his legal rationale for permitting torture. Of particular note in this case, when asked to provide information, the Attorney General said: I do not know what notes, memoranda, e-mails, or other documents others may have about these meetings, nor have I conducted a search. The unwillingness even to search for information requested by Congress epitomizes a certain official arrogance that sets a dangerous precedent because, when carried to its conclusion, it impairs and even impedes most congressional oversight. Government employees are named in countless documents that Congress needs in order to carry out its constitutionally mandated responsibilities and to shine the light where appropriate for the people of this country on the actions of our Government. In closing, I do not believe Judge Chertoff is an architect of the policy to deny the public their right to know what their Government is doing. That point needs to be made crystal clear. If I thought that were the case, I would not support this nominee. I think Judge Chertoff has made clear how he views these matters. But Senator Levin has raised a very important issue that transcends this nomination and reaches every agency and office in this government. It is the issue of preserving the openness, transparency, and accountability of our democratic government. I thank Senator Levin who, once again, during his service here, has proved how valuable attention to detail is. I commend my colleague for raising it. I thank the indulgence of the Chair. I yield the floor.

Mr. DODD. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. DODD

Mr. DODD. Mr. President, I come to the floor today, along with my colleague Senator Jim Bunning, to introduce the Screening Abdominal Aortic Aneurysms Very Efficiently SAAAVE Act of 2005. This important legislation would provide Medicare coverage for screening for a dangerous condition known as abdominal aortic aneurysm--or AAA. The SAAAVE Act is designed to save the lives of those suffering from abdominal aortic aneurysms, a silent killer that claims the lives of 15,000 Americans each year. AAAs occur when there is a weakening of the walls of the aorta, the body's largest blood vessel. This artery begins to bulge, most often very slowly and without symptoms, and can lead to rupture and severe internal bleeding. AAA is a devastating condition that is often fatal without detection, with less than 15 percent of those afflicted with a ruptured aorta surviving. Estimates indicate that 2.7 million Americans suffer from AAA. With introduction of this important legislation, Congress recognizes abdominal aortic aneurysm screening as essential to stopping its deadly effects. Research indicates that when detected before rupturing, AAAs are treatable and curable in 95 percent of the cases. And while most AAAs are never diagnosed, nearly all can be detected through an inexpensive and painless screening. I am particularly pleased that the U.S. Preventive Services Task Force recently recommended AAA screening for all men between the ages of 65 and 75 that have ever smoked. This independent panel of experts in primary care and prevention concluded that screening for abdominal aortic aneurysms for this particularly vulnerable population is especially important. The recognition of this screening measure by this respected body makes perfectly clear the lifesaving potential offered by AAA screening. For more than four decades the Medicare program has provided a literal lifeline for America's seniors and individuals with disabilities. However, for far too long this valuable program-- originally crafted only to provide needed care after an illness--failed to cover valuable preventive services. Recently, though, Medicare has evolved to include a number of preventive measures, such as mammography and colorectal screenings. With today's introduction of the SAAAVE Act, we again move Medicare toward greater inclusion of lifesaving preventive measures. This legislation reflects the changing attitudes toward the value of preventive health care services and moves us toward modernizing the Medicare program to better meet the needs of its more than 40 million beneficiaries. With enactment of the SAAAVE Act, instead of waiting to treat a ruptured aorta, Medicare will now help high-risk seniors avert this often-deadly disease through preventive and lifesaving screening. Lastly, I want to thank the legislation's chief sponsors in the House of Representatives, Gene Green and John Shimkus. Representatives Green and Shimkus have been tireless advocates on behalf of patients suffering from abdominal aortic aneurysms and their devotion to modernizing the Medicare program to include greater preventive services is truly admirable. I look forward to continuing working with my colleagues from the House to advance the SAAAVE Act in the 109th Congress. When Senator Bunning and I first introduced this legislation in the last Congress, we were joined by patients who had suffered a ruptured aorta as result of an AAA and their families. At this event these patients shared with us their harrowing and personal stories of battling this deadly condition. It is because of struggles like theirs that we are here today at the outset of an effort to prevent abdominal aortic aneurysms from advancing to the point of rupture by providing coverage for a simple yet lifesaving screening. Simply, Mr. President, this legislation is about saving lives. I urge all of my colleagues to support the SAAAVE Act.

Mr. DODD

Mr. DODD. Mr. President, I come to the floor today, along with my colleague Senator Jim Bunning, to introduce the Screening Abdominal Aortic Aneurysms Very Efficiently SAAAVE Act of 2005. This important legislation would provide Medicare coverage for screening for a dangerous condition known as abdominal aortic aneurysm--or AAA. The SAAAVE Act is designed to save the lives of those suffering from abdominal aortic aneurysms, a silent killer that claims the lives of 15,000 Americans each year. AAAs occur when there is a weakening of the walls of the aorta, the body's largest blood vessel. This artery begins to bulge, most often very slowly and without symptoms, and can lead to rupture and severe internal bleeding. AAA is a devastating condition that is often fatal without detection, with less than 15 percent of those afflicted with a ruptured aorta surviving. Estimates indicate that 2.7 million Americans suffer from AAA. With introduction of this important legislation, Congress recognizes abdominal aortic aneurysm screening as essential to stopping its deadly effects. Research indicates that when detected before rupturing, AAAs are treatable and curable in 95 percent of the cases. And while most AAAs are never diagnosed, nearly all can be detected through an inexpensive and painless screening. I am particularly pleased that the U.S. Preventive Services Task Force recently recommended AAA screening for all men between the ages of 65 and 75 that have ever smoked. This independent panel of experts in primary care and prevention concluded that screening for abdominal aortic aneurysms for this particularly vulnerable population is especially important. The recognition of this screening measure by this respected body makes perfectly clear the lifesaving potential offered by AAA screening. For more than four decades the Medicare program has provided a literal lifeline for America's seniors and individuals with disabilities. However, for far too long this valuable program-- originally crafted only to provide needed care after an illness--failed to cover valuable preventive services. Recently, though, Medicare has evolved to include a number of preventive measures, such as mammography and colorectal screenings. With today's introduction of the SAAAVE Act, we again move Medicare toward greater inclusion of lifesaving preventive measures. This legislation reflects the changing attitudes toward the value of preventive health care services and moves us toward modernizing the Medicare program to better meet the needs of its more than 40 million beneficiaries. With enactment of the SAAAVE Act, instead of waiting to treat a ruptured aorta, Medicare will now help high-risk seniors avert this often-deadly disease through preventive and lifesaving screening. Lastly, I want to thank the legislation's chief sponsors in the House of Representatives, Gene Green and John Shimkus. Representatives Green and Shimkus have been tireless advocates on behalf of patients suffering from abdominal aortic aneurysms and their devotion to modernizing the Medicare program to include greater preventive services is truly admirable. I look forward to continuing working with my colleagues from the House to advance the SAAAVE Act in the 109th Congress. When Senator Bunning and I first introduced this legislation in the last Congress, we were joined by patients who had suffered a ruptured aorta as result of an AAA and their families. At this event these patients shared with us their harrowing and personal stories of battling this deadly condition. It is because of struggles like theirs that we are here today at the outset of an effort to prevent abdominal aortic aneurysms from advancing to the point of rupture by providing coverage for a simple yet lifesaving screening. Simply, Mr. President, this legislation is about saving lives. I urge all of my colleagues to support the SAAAVE Act.