Christopher Dodd

Mr. DODD

Mr. DODD. Mr. President, I ask unanimous consent that the Senate proceed to a period of morning business, with Senators permitted to speak for up to 10 minutes each.

Mr. DODD

Mr. DODD. I yield back my time.

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 President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. DODD. Mr. President, I wish to propound a unanimous consent request. I will try to explain it in layman's terms. I ask unanimous consent that the Sanders amendment move from first place to second place and that the amendment offered by Senator Vitter, from Louisiana, be offered first, under the same conditions.

Mr. DODD. Mr. President, if my colleague wants to proceed a little longer, this is a very important amendment. If he wants to spend another minute or so talking about it, that is fine because I will need probably more than a minute to respond. Would he like additional time?

Mr. DODD. Mr. President, I rise in opposition to the amendment. I will explain why. The basic identity verification recordkeeping requirement in this amendment is already included in section 326 of the USA PATRIOT Act. It is redundant and not necessary on this amendment. This bill is designed specifically to deal with credit card reform. A matter such as this obviously belongs in a more appropriate place. Also, the amendment would require card issuers to verify an applicant's identity by obtaining a Social Security card, photo ID, driver's license, and a card issued by a State in compliance with the REAL ID Act. There are legitimate issues about terrorism and illegal immigrants in the country, but it seems to me when you already have provisions in the law that are specifically designed to protect the issues being raised by my friend--to add redundancy to a credit card bill, when we are trying to make sure people can have credit, and make sure it is provided in a way that is not abusive, with interest rate hikes, penalties, fees, and the like. I say, with respect, to my friend that, presently, applications for credit cards are currently taken by mail, by telephone, and on the Internet. This would force all applicants to physically go to the bank and present the required documents, which would cause a huge inconvenience to customers. I don't think that is in our best interest at this time. We are not trying to make it more difficult for people to have access to credit cards. We want adequate information so decisions can be made about their ability to repay, but we don't want to burden them with unfair fines, penalties, fees, and high interest rates. This idea runs contrary to what we are trying to achieve with this bill. I say, respectfully, that I oppose this amendment and ask my colleagues to do so as well.

Mr. DODD. Mr. President, I ask unanimous consent for 15 more seconds.

Mr. DODD. Mr. President, it is not my opinion that this would require people to show up physically. This is the opinion of the Treasury Department. We asked them to comment on this, and they told us that. The elderly, the handicapped, and those in rural areas are going to be adversely affected if this were to be adopted. It is duplicative, redundant, and unnecessary. It adds tremendous burdens on certain segments of this country. Credit cards are valuable instruments during difficult economic times.

Mr. DODD. I am happy to.

Mr. DODD. It is not the length of the amendment. Sometimes one or two words can have huge implications. We asked Treasury how they would interpret this, and they claim this would require the physical presence of an applicant. That is one of their concerns. As long as that is a concern and it raises that possibility, adopting this, which could result in that, it seems to me would be an irresponsible action for this body to take.

Mr. DODD. Mr. President, I move to reconsider that vote and move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 1062

Mr. DODD. Mr. President, what is the business before the Senate? Amendment No. 1085

Mr. DODD. Mr. President, there are very few Members for whom I have more affection or respect than Judd Gregg of New Hampshire. But I think this amendment, first of all, has no place on this bill. It is unnecessary and raises some very serious, legitimate issues. Let me point them out. First of all, it is going to be costly to do this: every agency to report what the national debt is. The number is absolutely worthless by the time you publish it because the national debt rises, of course, every nanosecond. So to have that idea what it is also gives you a false illusion of actually where we are. The level of public cynicism about this issue is getting almost insurmountable. It seems to me we need to be far more realistic. There are other costs, as well, in addition to the debt that people care about. Why not have a tuition cost clock? Why not have a health care cost clock? These matters go up all the time as well. It seems to me that by adding something such as this, we are just adding to that illusion, adding to that cynicism at a time when there are plenty of places where you can get this information--certainly the Congressional Budget Office as well. So while this amendment has been adopted in the past because it seems relatively harmless, the fact is, I think it is an idea that can actually raise costs and create false illusions. Certainly consumers ought to have some idea about some of these other costs, which I would object to. If you had a health care cost clock, a tuition cost clock, an energy cost clock, it could contribute to those problems. So I urge that the amendment be defeated.

Mr. DODD. Mr. President, let me make a couple of comments, if I can, regarding previous debates. Our colleague from Vermont offered an amendment to deal with caps on interest rates and that failed on a point of order. I know there are others who have various ideas about this issue. It is a legitimate issue, and I want my colleagues to know this. It is a complicated issue, because dealing with credit cards, dealing with payday lenders, dealing with all sorts of different entities, the matter of what is an excessive interest rate is one that many Americans care deeply about and one where they wish to see some restraint. It is legitimate to point out that there are interest rates being imposed today that you would have gone to jail for imposing not many years ago. In fact, it would make a loan shark blush, some of these interest rates that are being charged. So what I intend to do at some point, because I realize when you look at the votes, there were only about 30 votes dealing with the point of order dealing with the motion of the Senator from Vermont. But I think a lot of my colleagues do not feel his desire was illegitimate; they were concerned about whether the rate was too low or how it would apply. So I am going to propose--I hope along with my friend and colleague from Alabama--to ask either the Federal Reserve, or whatever else is the appropriate place, to come back and give us a comprehensive review of what national rates there ought to be. This idea that you can end up charging in effect 200, 300, or 400 percent interest rates, which is what has happened in some cases, is offensive, to put it mildly. It ought to be wrong and illegal, and people ought not to be able to get away with it. I think it is difficult for my colleagues to determine what is that level and what institutions, and under what financial circumstances, do you apply it to. I realize a payday lender lends money for a week or two, not annually. So the interest rate will be different than on a credit card, on a home mortgage, or what it is apt to be with a credit union. With various institutions, under various circumstances, rates can differ. It is confusing, except that most constituents and millions of Americans would like to see some restraint. I don't know how you can possibly explain why some institutions can get away with rates that are literally triple digits in some cases. I don't think we are going to resolve that matter on this bill. But we ought to have some clear idea of how to put some restraints on national usury laws. I am not a Bible scholar, but for those who are, I am sure they can recite chapter and verse in the Old and New Testaments when it comes to the usurious rates that were being charged by money changers and the like. At the appropriate time, I will propose an amendment that will allow us to get back to people in a short period with some analysis of how to impose some meaningful restraints on what is charged to consumers for the privilege of borrowing money when they need it, as so many do, to pay tuition, pay mortgages, keep the business operating and deal with the health care crisis, or just to survive week to week. People have been taken advantage of under circumstances that are deplorable, in my view, when the rates are particularly beyond excessive. I think one should not read the outcome of the Sanders vote as a rejection of the idea that applying some standards of fairness is unacceptable to this body. I believe a lot of Members voted against waiving the budget point of order not because they disagreed with what he is trying to do. I would not want that vote to reflect that. I support Senator Sanders, as I did on the budget debate, not because I necessarily agreed with the number he had in mind, but because it is an important debate and he should have had the right to be able to proceed with his amendment. I wanted to make that point overall. I think it would be a false impression to walk away and say the Senate rejected any idea of considering some sort of a national usury rate because they rejected the waiver of the point of order that Senator Sanders offered. I see my colleague from Louisiana, who I think wants to speak. I yield the floor.

Mr. DODD

Mr. DODD. Madam President, before my colleague from Oregon leaves the floor, I wish to thank Senator Merkley, who is a former speaker of the house in his home State. He is a new Member of this body and a welcome addition to it. While he and my colleague from Colorado, Senator Bennet, and Senator Warner from Virginia are new Members of the Senate and new members of the Banking Committee, I wish my colleagues to know what incredibly valuable additions they have been to the committee and to this body. In the few short months they have been here, I have gotten to know all three of them very well. We have had a lot of--almost, I think, close to 20--hearings in the Banking Committee since January 20 on a variety of issues. We had a housing bill up last week, which took a good part of the week, with some 20 amendments. Now we have this legislation. There is a lot of work in front of us. I wish to express to the people of Oregon how grateful we are to them they have sent Jeff Merkley to the Senate. He is making a wonderful contribution, and it has been in a matter of days. Certainly, on this issue, he has brought a wealth of knowledge and experience to the subject matter of consumer issues. Certainly, his additions and thoughts on the credit card legislation have been invaluable, as have been those by Bob Menendez, who was here a minute ago, the Senator from New Jersey, who is a more senior Member of the Senate but a former Member of the House. Also, his concerns about young people and the proliferation of credit cards arriving at their homes unsolicited, and in some cases being preapproved, has been a source of great concern for me over many years. To have the addition of Bob Menendez expressing his interests on those subject matters has brought us to the point where we now finally have provisions in this bill that do protect young people and their families. I pointed out yesterday that 20 percent of college students have in excess of $7,000 in credit card debt, and the average college graduate today is leaving college with more than $4,000 in credit card debt. In fact, one of the major reasons why students drop out is because of credit card debt. Again, we understand the value of a credit card. But the responsible use of it by the consumer and also the responsible proliferation of these cards by the issuers need to be in balance. It is not. This bill changes that, and we think for the better, which will provide the use of credit cards but in far more responsible ways than certainly presently is the case. I am very grateful to Senator Merkley, Senator Menendez, Senator Bennet, and Senator Warner, who have been involved in this debate over the last number of weeks and months. I am confident and hopeful in the next 2 days or so we will be able to finish the bill and work out with the House the differences we have, which are not many, and send this legislation to the President. The President, by the way, is the first American President who has spoken up so forcefully, on numerous occasions now over the last several weeks, on this issue. To have an American President talk about the importance of reform of the credit card industry has made an invaluable contribution to public awareness about this issue--not that the public needed to be made aware of it. The public has been living with it. They have been far more knowledgeable about this, with 70 million accounts over the previous 11 months having their interest rate go up. That is one out of four American families. As you have heard in anecdote after anecdote, fees have been raised, penalties have been imposed, charges have been added on, with no cause, no justification whatsoever. It is the only contract I know of where one party can change the terms at will. If you buy a home, if you buy a car, if you buy an appliance, there is a contract. The seller cannot change the terms midway in that contract. On credit cards they can, and they say it bluntly: For any reason, at any time, we will change the contract. Of course, that is terribly unfair to American consumers, at a time they are paying an awful price economically, as well as with jobs being lost and homes falling into foreclosure. I am hopeful this bipartisan bill Senator Shelby and I have put together will enjoy broad bipartisan support. I cannot think of a more significant message we can send to the American public about this institution caring about what they are going through today. We have spent a lot of time over the last number of months dealing with financial institutions: stabilizing them, TARP money, automobile assistance. Americans are wondering if we are ever going to do anything about what they are going through. Certainly, I understand--I think most of my colleagues do--that stabilizing our financial institutions ultimately will get credit moving and be a great help to businesses and consumers. But it is an indirect assistance. This is direct assistance. This is an opportunity to say, it is not going to happen any longer. We are putting a stop to it. The people are going to get the kind of help they deserve. People need credit cards. They are essential for them in the conduct of their everyday lives. But they need to have the assurance that the terms are not going to change, the rights do not change, the credit limits do not change on the basis of the issuer deciding that on their own. This bill addresses all of those issues in a very comprehensive and thoughtful manner. I am grateful, again, to the members of the Banking Committee, as well as to Senator Shelby, of course, and others who have helped put this legislation together. The majority leader has been a champion in this area, and he is the one who has allowed us to be on this floor and to engage in this debate. Having leadership that insists upon this kind of debate occurring is welcomed in this country, and I thank Senator Reid, as well, for those efforts. With that, Madam President, unless others wish to be heard, I suggest the absence of a quorum.

Mr. DODD

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Wednesday, May 13, 2009, at 10:30 a.m.

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Wednesday, May 13, 2009, at 2:30 p.m.

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on May 13, 2009 at 10:30 a.m., to conduct a hearing entitled ``Manufacturing and the Credit Crisis.''

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on May 13, 2009 at 2 p.m.

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Energy and Natural Resources be authorized to meet during the session of the Senate to conduct a business meeting on Wednesday, May 13, 2009, at 10 a.m., in room SD-366 of the Dirksen Senate office building.

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Wednesday, May 13, 2009, at 9 a.m.

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Homeland Security and Governmental Affairs be authorized to meet during the session of the Senate on Wednesday, May 13, 2009, at 10 a.m. to conduct a hearing entitled ``The D.C. Opportunity Scholarship Program: Preserving School Choice for All.''

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Homeland Security and Governmental Affairs be authorized to meet during the session of the Senate on Wednesday, May 13, 2009, at 2:30 p.m.

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Rules and Administration be authorized to meet during the session of the Senate on Wednesday, May 13, 2009, at 10 a.m.

Mr. DODD. Mr. President, I ask unanimous consent that the Committee on Small Business and Entrepreneurship be authorized to meet during the session of the Senate on Wednesday, May 13, 2009, at 2:30 p.m. to conduct a hearing entitled, ``Small Business Financing: Progress Report on Recovery Act Implementation and Alternative Sources of Financing.''