Anna Eshoo

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, Mr. Farr and I rise today to honor the life of George Ow, a local businessman and philanthropist, who passed away July 26, 2004 at the age of 85. He was a beloved member of the Scoffs Valley community and well known throughout Santa Cruz County for his generous nature. He is survived by seven children and 14 grandchildren. George Ow emigrated from China to the United States in 1937, arriving in Santa Cruz to begin his quest for the American Dream. He eventually emerged as one of our region's most prominent businessmen and philanthropists and his life story now stands as an outstanding model of achievement for all. Before becoming successful, George Ow had a long uphill climb that proved his perseverance and determination. He first worked in his uncle's grocery store while attending and eventually graduating from Santa Cruz High School. From 1944 to 1945 George Ow served in the United States Army and participated in the Allied Liberation of the Philippines. After his service in the military he returned to the Central Coast, building the foundations for his successful business ventures. Investing in commercial real estate, George Ow single- handedly created the business corridor along Capitola's 41st Avenue and Scotts Valley's King's Village Shopping Center. Throughout his rise to fortune and success, George Ow never forgot the community that nurtured him in his earlier days as a young immigrant. For more than three decades, he was active in the National Exchange Club, a national organization dedicated to community service and youth outreach. In the 1970s he was elected as President of the Club, the first time this post was filled by a non-white individual. He also created dozens of youth scholarships for minority students and donated money to local arts groups, such as Shakespeare Santa Cruz, and a variety of other health foundations. George Ow returned large portions of wealth back to his community, a gift that strengthens our community and our country. Mr. Speaker, we ask our colleagues to join us in extending our condolences to George Ow's family and friends. As a dedicated member of the Santa Cruz and Scotts Valley community, his achievements in life represent the epitome of the American Dream. He will be missed greatly by the community he loved, served, and gave so much to.

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, it is a privilege to recognize Richard M. Levy, Ph.D., my constituent from the 14th Congressional District of California and Chairman, President and CEO of Varian Medical Systems, who will be awarded the AeA 2004 Medal of Achievement on October 7, 2004. Dr. Levy will join a very select group of high-tech leaders who have received this honor, including William Hewlett and David Packard of Hewlett Packard, Ross Perot of Electronic Data Systems, Thomas J. Watson, Jr. of IBM, and Gordon Moore and Andrew Grove of Intel. The AeA Medal of Achievement is presented annually to recognize an individual who makes significant contributions to the advancement of and service to their community, the high-tech industry, and humankind. It is the highest award presented by AeA, the Nation's largest hightech trade association. Varian Medical Systems was created in 1999 when Varian Associates, Inc., a company Dr. Levy joined in 1968, was divided into three separate companies. It provides high energy radiation machines and associated hardware and software for treating cancer, and x-ray tubes for imaging in medical, scientific and industrial applications. With over 2,500 radiotherapy systems in place delivering treatments to more than one million cancer patients per year, including over 50 percent of all cancer patients in the U.S., the company holds a clear leadership position in this technology. Varian Medical Systems also ranks as the world's largest merchant supplier of x-ray tubes, including products for use in CT scanners, mammography units, and other diagnostic systems. Dr. Levy earned his bachelor's degree from Dartmouth College and his doctorate in Nuclear Chemistry from the University of California at Berkeley. He began his business career at the Monsanto Company where he applied his scientific background as a research specialist and project manager in both basic and applied research. Within Varian, prior to assuming management and CEO duties, he gained experience in sales, marketing, service, R&D, and various corporate functions as well as managing the corporate Quality Program. Dr. Levy served as senior vice president from 1989 to 1992, and executive vice president until 1999, when Varian Medical Systems was formed and he was named CEO. Dr. Levy is a member of the Board of Trustees of the Palo Alto Medical Foundation and the Boards of Directors of Pharmacyclics, Inc. and the California Healthcare Institute. He is a past Chairman of the Board of Directors of AeA, and served on the Board of Directors of the Diagnostic Imaging and Therapy Systems Division of the National Electrical Manufacturers Association. I ask my colleagues to join me in recognizing the extraordinary leadership and contributions of Dr. Richard M. Levy as he receives the AeA Medal of Achievement Award.

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, I rise today to commemorate and observe the solemn anniversary of the unspeakable attacks of September 11, 2001, and in particular to express my deepest sympathies to the families of two American heroes, Naomi Solomon who died in the World Trade Center and Andy Garcia who lost his life aboard Flight 93. Few events in U.S. history have been so jarring to our collective security and so unifying. The sorrow we all felt that day was surpassed only by our commitment to do everything possible to ensure that never again would we be so vulnerable and so unprepared. Today, on the third anniversary of that fate-filled day, we must reconnect ourselves to the task of actually doing what has not yet been completed to make America safe. While we've made progress, we cannot rest. Whether on land, sea, or air, critical security gaps continue to exist 3 years after the attacks of September 11. We have before us concrete steps, recommended by the 9/11 Commission, to address our vulnerabilities and to strengthen our defenses. Congress must reform the intelligence community by doing the following: Create a strong National Intelligence Director; Improve Congressional oversight; Ensure an integrated terrorist watch list; Strengthen the FBI's ability to collect and analyze domestic intelligence; Create an integrated strategic plan for aviation and transportation security; Improve airline passenger and baggage screening; Improve coordination between FAA and military authorities; Provide for the increased assignment of radio spectrum for safety purposes; and Make the Select Committee on Homeland Security permanent. In the aftermath of our Nation's tragedy, the American people wanted to know how we could help the families of the victims. Their response was to seek independent investigation of what led up to the attack on our country. We owe it to them and to our entire Nation to implement the unanimous recommendations of the bipartisan Commission to protect the American people and our national security. We can do nothing less.

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, I'm joined by Representatives Lofgren and Honda in rising today to recognize the achievements of Ken Yeager, District Six City Councilman for the City of San Jose and co-founder of the Bay Area Municipal Elections Committee, a four county Lesbian, Gay, Bisexual and Transgender political action group celebrating 20 years of civil rights advocacy. Ken represents the neighborhoods of Willow Glen, Rose Garden, Shasta/ Hanchett, Sherman Oaks, Cory, Canoas Gardens, Hamann Park and Buena Vista on the San Jose City Council. He is a graduate of San Jose State where he interned with former City Councilmember Susie Wilson. He then worked for Congressman Don Edwards, leaving to earn a Ph.D. from Stanford in 1991. Ken was the first openly gay man to be elected to office in Silicon Valley when he was elected to the San Jose Community College Board. He has dedicated much of his impressive career to educating the community about LGBT issues and fighting for their rights throughout the Silicon Valley. BAYMEC was founded to educate and inform, and it has raised its concerns with countless elected officials. It lobbied Sacramento on AIDS and LGBT civil rights and worked with police, fire departments, governmental, organizational, and a variety of community groups to further equality for LGBTs. BAYMEC continues to lobby for the passage of hate-crime legislation, transgender issues, domestic partnership rights and civil unions, as well as bringing LGBT sensitivity to the forefront in the domestic violence field. During LGBT Pride weekend, Ken spearheaded the campaign to fly the rainbow freedom flag over City Hall. He worked hard to make sure that the Billy DeFrank LGBT Community Center was completed on time and chaired the fundraising committee to improve the center. Ken has also led the drive to pass a Gender Non-Discrimination Ordinance for the City and he supports providing full benefits for all married City employees, regardless of sexual orientation. Mr. Speaker, we ask our colleagues to join us in thanking Ken Yeager for his steadfast and tireless service to his constituents and to the LGBT community. We look forward to working with him to further the causes important to BAYMEC, because until all people are treated with dignity and respect, none of us can truly be free.

Ms. ESHOO

Ms. ESHOO. Mr. Chairman, I thank the gentleman from Ohio (Mr. Oxley) for yielding me time. Mr. Chairman, I oppose this amendment, and let me state very clearly why. Number one, this amendment allows the SEC to override what the Congress wants. I think that stands our process on its head. And I am not suggesting that our process is always perfect and tidy. I thought that when I came here that when the Congress legislates and the executive signs on to that and a bill becomes law that it is up to the executive branch of government to carry that out. We have gotten nowhere with this accounting board. They do not want to sit down and hear the other side of this, which is economic. And so that is why I urge my colleagues to reject the amendment. It essentially guts the bill. If you are opposed to stock options for rank-and-file employees, be opposed to that; but to do this the other way around, I think really begs the question.

Ms. ESHOO. Mr. Chairman, I thank the gentleman from Ohio for the time, and Mr. Chairman, I would like to point out a few things here about the substitute. First of all, obviously I respect the gentleman from Pennsylvania, but I do not support the substitute, and let me tell my colleagues why. There was a chart that was here on the floor a little earlier of companies that expense. I wish we had a chart on the floor that demonstrated that those companies that do do not offer stock options to their rank-and-file employees. This debate is not about the venture capitalists. They are going to make their investments. They are going to pick and choose. But this is a magnet that attracts individuals to form new companies to allow them to grow and bring them up to profitability. We want to destroy this? Well, it is going to be in the hands of the Congress to do that. That is what this debate is about. Those that have problems with executive compensation have problems with it. Talk to the board of directors that form those packages, but rank-and-file employees do not get to negotiate their compensation or those packages. That is why their stock options are so important. This substitute does not address FASB's failure to develop accurate expensing formulas. They are unwilling to even road-test the standards that they are talking about. Now, I think that that is really unfair. That is why, as a Member of Congress, I stepped in. I think we should, and I think it is appropriate because we do have a responsibility to answer to the American people about economics and economic impacts on our people. That is why I urge my colleagues to reject and to vote against the Kanjorski substitute. It was rejected in the committee and it should be on the floor.

Ms. ESHOO. Mr. Chairman, I thank the gentleman from Pennsylvania (Mr. Kanjorski) for yielding me this time. I am very proud to be the lead Democratic sponsor of this bill. My partner, the gentleman from Louisiana (Mr. Baker), the gentleman from California (Mr. Dreier) before him, and colleagues from both sides of the aisle, this is a true bipartisan effort: over 100 cosponsors, including leadership from the Democratic side, our distinguished leader, the gentlewoman from California (Ms. Pelosi), as well as from the Republican side. This is not a partisan issue, nor should it be. What this debate is about is not simply the grays and the green eye shade issues of accounting. What stands front and center in this issue is the American economy and how we continue to spur it. There are three major ingredients that other countries around the world have come to understand because they have studied it, and it has been part of our success: venture capital, the protection of intellectual property, and stock options. Why stock options? Because it is a magnet that attracts workers to a company; and with that magnet it is stated, yes, we are willing to take a risk and make this company grow. And when we do, we will all share in the rewards. That is intrinsically American. Now, have there been people who have abused stock options at the top? Sadly, that was the case. And the Congress stepped in because the SEC needed us to step in. The SEC did not do what it was supposed to do, and the Sarbanes-Oxley legislation was passed. So in terms of the debate, leave the SEC alone, leave the FASB alone, we should not interfere, we should not step in, that case is absolutely blown by having adopted Sarbanes-Oxley. The FASB has put out an accounting standard. They understand that they have nothing to do with the economy, and they are proud of saying that. The Congress does have a responsibility for anything that impinges on our economy. There are institutional investors in this country that are not interested in individual stakes and shareholders. That is all right; it is the view that they hold. So this debate today, and make no mistake about it, listen carefully, this is about protecting a tool that has paid off for rank-and-file workers across the country. This is not only about high technology and biotechnology. In fact, most of the stock option holders' rank-and-file are outside of those two industries, and they represent 14.6 million workers in our country. Now why expense the people at the top? Because they come to their compensation package differently. Rank-and-file workers do not negotiate with a board of directors; the top five in the company do. This is balanced. This is important. This is essential. Do not wreck one of the most valuable tools that we have in our country today to expand our economy, to expand new businesses and to have a stake in the future of America. I urge my colleagues to support H.R. 3574. Mr. Chairman, I'm proud to be the lead Democratic sponsor of the Stock Option Accounting Reform Act, and thank Chairman Baker for his leadership, moving it through the Financial Services Committee with such strong support. The legislation is urgently needed to avert the implementation of new accounting rules that would have a disastrous impact on American companies, and more importantly, American workers. The Financial Accounting Standards Board (FASB) has long threatened to require stock options to be deducted from a company's earnings, and this bill would prevent FASB from implementing this requirement for many critical reasons. Mandatory expensing of stock options would have a terrible impact on companies that rely on options to recruit and retain the most talented employees. Without stock options, many of these companies--including some of the most successful high-tech and biotech firms--would not even exist today. Stock options have become associated with corporate scandals and excessive executive compensation, leading to a call for expensing as the ultimate prescription for these problems. But stock options were not the cause of the recent corporate accounting scandals, and eliminating stock options would do nothing to instill corporate responsibility or accountability. The crimes committed at Enron, Tyco, and other companies would not have been prevented if expensing was the accounting rule of the day. The Sarbanes-Oxley legislation, which I was proud to support, was passed to prevent future corporate swindles. If companies are forced to expense stock options, most will drop broad-based option plans because of the prospect of taking a huge and misleading charge against their bottom line in accounting statements. Make no mistake about it. Stock option plans or some other form of lucrative compensation for senior executives will undoubtedly continue to be offered. Consider this: Only a small portion of employee-held options--about 15 percent--are held by corporate management. 14.6 million American workers--13 percent of private-sector workers nationwide--held stock options in 2002. It's ironic that many are calling for the expensing of stock options in order to reign in executive compensation, when expensing stock options would do little to accomplish this. Rather rank and file employees would be the ones to lose, because they don't get to negotiate with a Board of Directors for their compensation package. H.R. 3574 also answers many of the critics of stock options who maintain (wrongly) that this compensation is an ``executive perk'' and a tool to avoid reporting executive salaries. The Stock Option Accounting Reform Act requires companies to expense options granted to the CEO and the next four highest paid officers. Small businesses are exempted from this requirement and cannot be required to expense options for the 3 years following an initial public offering. The bill would also enact new disclosure rules for companies who offer stock options, requiring them to disclose additional information regarding share value dilution and other stock option-related information. Some have also argued that FASB's independence must be protected and accounting standards--like other technical rules--should not be set by Congress. While in general this is the case, there are many occasions when expert bodies fail to fully protect the public interest and it's incumbent on Congress to step in. For example, the Securities and Exchange Commission--an independent, expert agency--failed to adequately protect investors and the public from the corporate scandals of recent years: Congress stepped in to enact the reforms of Sarbanes- Oxley. Recently, a ``determination on drug safety'' was made by the Food and Drug Administration which found that the morning-after birth control pill was not safe enough to approve for over-the-counter sale, despite ample evidence to the contrary. I would hope that if the FDA does not change its position on the morning-after pill, we will act to overturn this decision as well. Even the Chairman of FASB recently acknowledged that the Board has proceeded too quickly and the implementation of the new expensing rules may need to be delayed. H.R. 3574 would simply ensure that the rules are not implemented for at least a year, pending economic impact studies by the Commerce and Labor Departments. Given the radical change the new rules would establish and the potentially devastating impact on employee ownership programs, Congress has the responsibility to make sure that these rules are appropriate and implemented responsibly. I urge my colleagues to support this legislation and protect broad-based employee ownership programs.

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, I thank the gentleman from Florida (Mr. Hastings), my good friend and classmate, for yielding me this time. I am very proud to be the Democratic lead sponsor of the Stock Option Accounting Reform Act, and I want to thank the gentleman from California (Chairman Dreier) for his partnership and his hard work, and the gentleman from Louisiana (Chairman Baker), as well as colleagues from both sides of the aisle for the work that they have done to bring this issue forward so that we can take this up on the floor of the House today. The Financial Accounting Standards Board, FASB, has sought for years to force public companies to expense stock options from their earnings, and Congress has consistently turned away these efforts. This is not the first time. I hope it will be the last time, but it is not the first time. Now, the board has seized on the recent corporate scandals to push this controversial proposal through. But supporters of the FASB rule, including FASB itself, are unable to identify a single instance where the accounting treatment of broad-based stock option plans for rank- and-file employees has contributed to corporate misconduct or shareholder fraud. Stock options are already fully disclosed in corporate financial treatments. They are not, however, deducted from earnings. The reason most companies reject the expensing of stock options is that their actual cost is highly speculative and extremely difficult to measure. Options have a direct impact on the dilution of shareholder value, but the actual cost to the company is uncertain. Furthermore, valuation of employee options is highly inaccurate, and FASB has yet to come up with an acceptable means for estimating their value. That is why this legislation is needed. It is needed to prevent FASB's new rules from taking effect later this year, causing substantial disarray in corporate accounting. Implementation of these new accounting rules would have a disastrous impact on American companies and, most importantly, American workers. If companies are forced to expense stock options, most likely they will drop broad-based stock option plans because of the prospect of taking a huge and misleading charge against their bottom line. So while corporate executives will undoubtedly continue to receive lucrative compensation, rank-and-file employees will lose the benefits of these employee ownership programs. Congress, I believe, has the responsibility to ensure that a major change in corporate accounting is appropriate and that it is implemented prudently. Why? Because impacts on our national economy are the business of the Congress. We would not have stepped in before, and I would not be offering this legislation were this not the case. FASB has acknowledged that to us, that they are in charge of accounting rules; but they do not take into consideration the economic impacts. So I urge my colleagues to look at this carefully. There are many, many complications to this. More than anything else, this is not for corporate executives. This is for rank-and-file employees who take a risk in start-up companies and say that when the risk is realized in a positive way that everyone wins. Let us protect that, especially at a time where our national economy needs to protect something that we know works.

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, I'm pleased to support the Project Bioshield Act which encourages the development of new countermeasures to deal with diseases and conditions caused by bioterrorism attacks. It authorizes $5.6 billion over 10 years for purchasing countermeasures, such as vaccines and treatments, to bioterrorist attacks. The bill also allows the government, in the event of a national emergency involving a bioterrorism or similar attack, to distribute to the public certain drugs and treatments that have not yet been approved by the Federal Drug Administration (FDA). The Project Bioshield Act is an important part of our mission to secure and protect our homeland and hometowns. The threat of chemical, biological and radiological attacks is too great and this bill provides necessary regulatory flexibility to the Department of Homeland Security and the Department of Health and Human Services so they can speed and promote research and development of needed countermeasures. The September 11th tragedies and subsequent anthrax attacks made the Nation aware that the public health system is ill-prepared to mange a large scale emergency. Since then, our public health system has continued to respond to high profile threats like severe acute respiratory syndromes (SARS) and West Nile Virus which illustrate how quickly infections can spread among populations and across the globe. Over the last 3 years, our eyes have been opened to the threats we face on our own soil. We've discovered serious vulnerabilities and I'm proud of what we've done in this bill to address them. I urge the entire House to vote for this important legislation.

Ms. ESHOO

Ms. ESHOO. Madam Chairman, we made our presentation. The gentleman was complimentary of how the presentation was made and of the substance and the last thing he said was, I cannot support this amendment. That is what he said.

Ms. ESHOO. Madam Chairman, will the gentleman yield?

Ms. ESHOO. Yes, Mr. Chairman, I offer an amendment.

Ms. ESHOO. Madam Chairman, I yield 2 minutes to the gentleman from Oregon (Mr. DeFazio).

Ms. ESHOO. Madam Chairman, I yield to the gentlewoman from California (Mrs. Davis), for the purpose of a unanimous consent request. (Mrs. DAVIS of California asked and was given permission to revise and extend her remarks.)

Ms. ESHOO. Madam Chairman, I yield myself the balance of my time to make a closing statement. Madam Chairman, I thank all of my colleagues that have fought so hard and so courageously for 4 years. Madam Chairman, this is an issue about greed, greed gone absolutely wild; and the victims of the greed, this insatiable greed for money, money, money, money, money, are the people of my State of California, the people of the State of Washington, the people of the State of Oregon, the people of the State of Nevada. I have heard some really outrageous things here today. You, my friends, have been given the power by the people of the United States of America to hold the majority here. For 4 years we have fought. Not one hearing was even granted in the Committee on Energy and Commerce. We have presented solutions for restitution to our people, for refunds, and have been denied over and over and over again. So there has not only been an abuse of power by the power companies, but by the majority party in this House. Now we have come forward and requested last evening at the Committee on Rules that all points be waived in order to present an amendment for refunds. That was denied. Now the gentleman from Ohio (Mr. Hobson) has allowed this limited amendment that we now have on the floor. Make no mistake, not one Republican from the State of California supported in 4 years a refund to our people. This legislation has been there. We have sent Dear Colleague letters. I will not yield, because I waited 4 years for this moment, and this is for our constituents. They have not used their power to bring about restitution to them. How much more evidence do you need? You have heard the tapes. It is not just about being upset about the evidence. It is up to us, those who have been vested with the power, to do something on behalf of the consumer. It is not enough to say our constituents have been hurt. Use the power. Use the power to override the power of the power companies that manipulated, that extracted, and then bragged about it. Shame on anyone that would not stand next to the grandmother that these people referred to and were so gleeful about picking her pockets. Shame on them. Shame on anyone that does not fight every day to make good for these people. These are the extraordinary, ordinary people of our country. That is who we stand next to. We invite you to finally do something, to take one tiny step, if you have it in you, to do that. The White House turned us down, the Federal Energy Regulatory Commission turned us down, the chairman of the Committee on Energy and Commerce turned us down over and over and over again. So I say to those that stand next to the consumer, no matter how frustrating, no matter how dark it has been, let us do something about it. We have had the solution. We come forward now with a very small one. I thank everyone that has been part of the effort. You have been absolutely magnificent. And I am proud to serve with those that, even in the worst of times, sought to do something about it. It is what people sent us here for. Do not forget that. That is what our power is for. Not for Enron, not for Reliant, not for people that commit criminal activities against those that send us here to stand up for them. Madam Chairman, I thank the gentleman from Ohio (Mr. Hobson) for allowing this to be brought to the floor and debated. Madam Chairman, I yield back the balance of my time.

Ms. ESHOO. I thank the gentleman for yielding to me. I asked that the Committee on Rules waive in order for the amendment to be accepted.

Ms. ESHOO. Mr. Chairman, I yield myself such time as I may consume. This is a very simple and clear amendment and it states that none of the funds made available in this act may be used to deny requests for the public release of documents or evidence obtained through or in the western energy markets. What brings this amendment, the intent of this amendment, and why we are making it, Mr. Chairman, is really very clear. There are mounds of evidence relative to the manipulation of energy and the energy markets in the Pacific Northwest and in California between 2000 and 2001. We need to secure what is there. There is so much evidence that is being withheld. That is why we bring this amendment forward. Mr. Chairman, I yield 1 minutes to the gentlewoman from California (Ms. Pelosi), the very distinct minority leader of the House.

Ms. ESHOO. Mr. Chairman, I am pleased to yield 2 minutes to the gentleman from Oregon (Mr. DeFazio).

Ms. ESHOO. Madam Chairman, I yield for the purpose of making a unanimous consent request to the gentlewoman from Nevada (Ms. Berkley). (Ms. BERKLEY asked and was given permission to revise and extend her remarks.)

Ms. ESHOO. Madam Chairman, I yield 3 minutes to the gentleman from Washington State (Mr. Inslee). (Mr. INSLEE asked and was given permission to revise and extend his remarks.)

Ms. ESHOO. Mr. Chairman, I thank the distinguished ranking member for yielding me this time. Since my friend from California would not yield any time, I just would like to set this down for the record. The amendment relative to the previous question this morning had solutions in it. We are now in the year 2004. We do not need any more debates about the markets. The energy companies have essentially signed confession slips on this. So let us not go back to 1999. We now have evidence. That is why we are saying the FERC should order refunds. The gentleman, by voting for the previous question, he turned down the solution of refunds. Let us make that very clear here this morning.

Ms. ESHOO. Madam Chairman, will the gentleman yield?

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, I thank the gentleman from Massachusetts (Mr. McGovern), who has been a wonderful supporter of our effort that has been stretched out over 4 years. Mr. Speaker, I strongly support the underlying bill. It is an excellent one, and I commend the gentleman from Ohio (Mr. Hobson) and the ranking member, the gentleman from Indiana (Mr. Visclosky) for their bipartisan leadership of the Subcommittee on Energy and Water Development. But I rise to urge the defeat of the previous question on the rule, because the rule does not provide a waiver for the amendments to address market manipulation and require the Federal Energy Regulatory Commission to take action to refund consumers' dollars that were manipulated. I testified before the Committee on Rules yesterday that this amendment be made in order, but the request was denied. I think the word ``denial'' pretty well sums up the response of Congressional Republicans and the FERC to the western energy crimes. In 2000 and 2001, FERC essentially allowed energy producers to game and corrupt the western energy market, and consumers were gouged billions of dollars. In March 2001, Congressional Democrats wrote to the President for help and we are still waiting for the reply. In 2002, Democratic Members of the California delegation asked six times for a Congressional investigation and hearings on market manipulation. It never happened. In 2003, we tried to address the refunds issue with amendments to the Energy Policy Act. Nothing happened. Over 4 years we have tried everything we could to help consumers in the Pacific Northwest and California. This work is summarized in a five-page document which, Mr. Speaker, I include for the record. The House must consider this amendment today because we are running out of opportunities to right the wrongs which created the crimes itself. This amendment will first amend the Federal Power Act by changing the rules for refunds effective dates under Section 206. Currently, these rules allow refunds after a complaint has been filed. This amendment will allow refunds for all overcharges regardless of when a complaint has been filed. This change will require FERC to order refunds for the gouging that occurred in the West and elsewhere in the Nation in 2000 and 2001. Two, it requires FERC to open new investigations, if necessary, to award refunds to western consumers. Three, it requires the FERC to step in to order refunds whenever manipulation occurs in the future in any State in our country. Four, it requires the FERC to allow California to participate in heretofore secret negotiations between FERC and power producers who were thought to have engaged in market manipulation. And lastly, it requires the FERC to make public all documents that it is holding related to the manipulation of the western energy market in 2000 and 2001. And let there be no doubt, there were wrongs. The Enron tapes which CBS broadcast earlier this month make it all too clear that companies were manipulating the market. They bragged about stealing money from ``those poor grandmothers in California.'' Some of the language was so profane that by congressional action it was deemed it could not be broadcast. The language was shocking and the facts in the transcripts chilling. They are part of a litany of evidence of widespread market manipulation. There are smoking gun memos in which Enron admitted how they gamed the market. They had names for each one of their undertakings. We have transcripts of employees of Reliant Energy describing how they gamed the market; and with that striking evidence, FERC chose to negotiate a settlement in this case for pennies on the dollar without allowing California to participate. We have reams of evidence discovered by the State of California. We have the Justice Department's indictments and plea agreements with many energy traders and producers. Even the FERC found ``significant market manipulation.'' But, despite the evidence, the FERC has been reluctant to order refunds to compensate consumers even though it has the obligation to protect energy consumers of our country. Mr. Speaker, it has been 4 long years since the crisis began. Consumers have been waiting for relief. We think they deserve it and they should have it. I urge my colleagues to defeat the previous question and allow this amendment to come to the floor. Congressional Activity To Address the Energy Crisis--Chronology Highlights 2000 June 14, 2000--First blackout of the electricity crisis and first blackout in California since World War II. August 2, 2000--San Diego Gas & Electric Company (SDG&E) files a complaint under Rule 206 under the Federal Power Act against western power suppliers, alleging that market prices are ``unjust and unreasonable.'' Calls on the Federal Energy Regulatory Commission (FERC) to impose price limits. November 1, 2000--FERC reports that wholesale electricity prices have been and have the potential to continue to be ``unjust and unreasonable.'' 2001 January 19, 2001--25 members of the California delegation write to FERC to urge it to address the high price of electricity in California. January 20, 2001--Representatives Duncan Hunter and Anna G. Eshoo introduce H.R. 238 to amend the Department of Energy Authorization Act to authorize the Secretary of Energy to impose interim limitations on the cost of electric energy to protect consumers from unjust and unreasonable prices in the electric energy market. A bipartisan group of thirty-two Western Members cosponsor the bill. Senate companion (S. 26) introduced by Senators Dianne Feinstein and Barbara Boxer on January 22, 2001. January 30, 2001--Representative Bob Filner introduces H.R. 268, the California Electricity Consumers Relief Act, that requires FERC to order refunds retroactive to the beginning of the crisis on June 1, 2000. March 2, 2001--Representatives Hunter and Eshoo write to House Energy and Commerce Committee Chairman Billy Tauzin and House Energy and Air Quality Subcommittee Chairman Joe Barton to call for a hearing on the Western energy crisis and H.R. 238. March 6, 2001--House Subcommittee on Energy and Air Quality holds hearing--Congressional Perspectives on Electricity Markets in California and the West and National Energy Policy. March 20 and 22, 2001--House Subcommittee on Energy and Air Quality holds hearing--``Electricity Markets: California.'' March 22, 2001--House Democrats write to President Bush to urge him to fill FERC vacancies, to call on FERC to investigate and mitigate high electricity prices in California, and to replace FERC Chair Curtis Hebert. No reply is received from the President. March 23, 2001--California Democrats on the House Energy and Commerce Committee respond to the majority's request for comments on proposed legislation to ``fix'' problems in the Western energy market. Members note the omission of any provision to address the excessively high cost of electricity. No formal reply is received. March 30, 2001--Democratic Members from California, Washington, and Oregon write to President Bush to urge him to address the high cost of wholesale electricity and ``investigate recent allegations of overcharges'' in the Western energy market. No substantive reply is received from the President. April 4, 2001--H.R. 1468 is introduced with the support of 30 California Democrats. The bill requires the Federal Energy Regulatory Commission to impose cost-of-service pricing in the Western electricity market and to order the refund of overcharges. April 10, 2001--U.S. Secretary of Energy Spencer Abraham writes to Members of Congress to update them on the Administration's efforts to address the energy crisis. The Secretary discounts the crisis as ``a supply crisis'' and states the Administration's opposition to price mitigation. April 16, 2001--California Democrats on the House Energy and Commerce Committee write to FERC Commissioner Linda K. Breathitt to urge her to support cost-of-service pricing in the West. April 26, 2001--FERC issues an order establishing a price mitigation plan during stage 1, 2, and 3 power emergencies. The order sets the mitigated price on the most inefficient, polluting generator in the State. Generators can exceed the mitigated price if they justify their costs. May 1 and 3, 2001--House Energy and Air Quality Subcommittee holds hearing on H.R. 1647, The Electricity Emergency Act of 2001--a bill with the purported purpose of solving the energy crisis by increasing the supply of electricity. Among other proposals, the bill calls for the suspension of federal environmental laws that might diminish energy production. California Governor Gray Davis and the California Energy Commission and Air Resources Board report that environmental protection laws are not an impediment to energy production. The bill does not address runaway prices. May 1, 2001--Members of the California Republican Delegation meet with Vice President Dick Cheney on the energy crisis. California Democrats are not invited. May 3, 2001--California Democratic Congressional Delegation Chair Sam Farr writes Vice President Cheney criticizing him for excluding California Democrats from his May 1, 2001 meeting with California Republicans. Rep. Farr requests a meeting with the Vice President. May 4, 2001--44 Democratic Members of Congress write to Secretary Abraham to use his authority to address price gouging in the West. Reply reiterating the Administration's opposition to ``price caps'' mailed July 2, 2001. May 17, 2001--Vice President Cheney and the National Energy Policy Development Group (NEPDG) submit their recommendations to President Bush. The recommendations do not include anything to address runaway prices in the West. About the Western energy crisis, the NEPDG writes, ``Though weather conditions and design flaws in California's electricity restructuring plan contributed, the California electricity crisis is at heart a supply crisis'' (National Energy Policy, page 1-3). The report blames California for not building enough generating plants, ``there are no short-term solutions to long-term neglect.'' May 25, 2001--84 Democratic Members of the House write President Bush to request that he back a price mitigation amendment to H.R. 1647 based on H.R. 1468. No reply is received from the President. May 25, 2001--Ten respected economists, including Alfred Kahn, architect of deregulation in the airline industry, write to President Bush and the Congressional leadership to express support for cost-of-service based rates for electricity in the western market. June 2, 2001--Rep. Eshoo delivers the Democratic response to the President's weekly radio address on the energy crisis. June 7, 2001--21 Western Democrats write to FERC Chairman Curtis Hebert to request the opportunity to testify before the Commission in a public meeting. June 12, 2001--California Democratic Congressional Delegation meets with Vice President Cheney about the energy crisis. Vice President promises no intervention to alleviate high prices. June 13, 2001--29 members of the California Democratic Congressional Delegation write to Vice President Cheney following a CNN report that the White House and Congressional Republicans funded an advertising campaign to oppose price mitigation in the West. June 19, 2001--FERC expands its April 26th order to cover the entire West during all hours of operation, requires all generators to make their power available, and continues to base the mitigated price on the least efficient generator. FERC determines that refunds are owed and orders administrative hearings to determine the amount. June 19, 2001--Members of the California and Western delegations testify before the House Rules Committee in support of amendments to H.R. 2246, the Fiscal Year 2001 Supplemental Appropriations bill. The amendments would require FERC to impose cost-of-service pricing in the West and order electricity generators to pay refunds of rates that are ``unjust and unreasonable.'' The Rules Committee, chaired by California Republican David Dreier, refuses to allow the consideration of these amendments. June 20, 2001--Representative Nancy Pelosi attempts to bring a cost-of-service amendment to H.R. 2246 to the floor. Republicans block it on a procedural objection. June 20, 2001--Governor Gray Davis, with many Members of the California Congressional Delegation in attendance, testifies before the Senate Governmental Affairs Committee about FERC's activities in the Western energy market. June 30, 2001--California Democratic Congressional Delegation writes to FERC Chairman Curtis Hebert about 32 important California-related cases that were pending before the Commission for an extended period of time. Reply dated August 28, 2001. July 17 and 18, 2001--House Energy and Commerce Committee holds markup of the Committee Print, Energy Advancement and Conservation Act. Committee defeats two amendments offered by the California Democrats on the Committee to impose cost-of- service pricing and require the refund of overcharges. August 1, 2001--Floor consideration of H.R. 4, Securing America's Future Energy. House defeats Rep. Waxman's cost-of- service pricing amendment by 157-274. The Rules Committee refuses to make in order an amendment offered by Representatives Eshoo and Harman to require refunds of overcharges. October 29, 2001--Rep. Eshoo testifies before a FERC technical conference on behalf of the California Democratic Congressional Delegation. Requests that the Commission's price mitigation plan remain in force until the market has stabilized. Asks the Commission to act quickly in ordering refunds. November 27, 2001--California Democrats on the House Energy and Commerce Committee write to Energy and Air Quality Subcommittee Chairman Barton to urge him to address the problem of market power in energy markets within draft electricity restructuring legislation. No reply is received. 2002 February 14, 2002--Members of the California Delegation write to House Energy and Commerce Committee Chairman Tauzin to urge him to investigate and hold hearings on the business conduct and pricing practices of Enron during the Western energy crisis. May 8, 2002--The California Democratic Congressional Delegation and 4 Northwestern Democrats write Chairman Tauzin, urging him to open an investigation and to hold hearings on market manipulation in the Western energy market after FERC posts internal Enron memos detailing how the company artificially inflated prices. Memos indicate that other companies adopted the same practices that Enron did. May 9, 2002--The Securities and Exchange Commission announces investigation into the ``round-trip'' trades between Dynegy, an energy marketer that sold into the California market, and CMS Energy of Dearborn, Michigan. May 15-16, 2002--Senate Consumer Affairs, Foreign Commerce, & Tourism Subcommittee holds hearing on Enron memos entitled, ``Examining Enron: Developments Regarding Electricity Price Manipulation in California.'' Rep. Eshoo and Harman attend. The Senate Energy and Natural Resources Committee holds a similar hearing. June 5, 2002--California Democrats on the House Energy and Commerce Committee lead 75 House Members, including Minority Leader Gephardt, in a letter to House Speaker Hastert and Energy and Commerce Chairman Tauzin to ask for an investigation of energy suppliers. June 5, 2002--31 California Democrats write to FERC Chairman Patrick Wood to urge him to extend FERC's price mitigation plan for the West beyond September 30, 2002 when it is due to expire. June 18, 2002--The General Accounting office issues a report that exposes weaknesses in FERC's ability to regulate energy markets. The report says, ``FERC is not adequately performing the oversight that is needed to ensure that the price produced by [energy] markets are just and reasonable and therefore, it is not fulfilling its regulatory mandate.'' June 19, 2002--California Democrats on the House Energy and Commerce Committee write to Chairman Tauzin again to urge a hearing and investigations, noting that the GAO report indicates that FERC is not up to doing the job on its own. June 20, 2002--Congress Daily AM reports, ``House Republicans agreed [June 19, 2002] to hold a hearing to examine whether trading firms such as Enron Corp., may have illegally manipulated electricity prices in the West.'' The article continued, ``The hearing would serve as a spring board for a broader inquiry into price manipulation and FERC's ability to oversee the Market [Energy and Commerce Committee Chairman] Tauzin said.'' July 25, 2002--California Democrats on the House Energy and Commerce Committee write to Chairman Tauzin again to urge a hearing and investigations, noting that he has not fulfilled his public promise a month earlier to hold hearings and investigate energy transactions in the West. The letter notes that this work should be completed before Chairman moves ahead with the consideration of electricity provisions in the House-Senate Conference Committee on H.R. 4, the comprehensive energy bill. Finally, the letter asks for access to documents that Committee obtained from FERC. The documents had been compiled by FERC as a part of an investigation that it initiated following inquiries from U.S. Senators. July 26, 2002--Chairman Tauzin responds to the Western Representatives May 8, 2002 letter with a recitation of the Committee's previous work on the Western energy crisis in 2001. The Chairman notes that he requested and received the documents he received from the Federal Energy Regulatory Commission (FERC), which were being reviewed by majority and minority staffs. However, he does not explain why the Committee has not held a hearing since the Enron ``smoking gun'' memos were made public. The Chairman does not respond to the request for access to the FERC documents. August 21, 2002--California Democrats on the House Energy and Commerce Committee respond to Chairman Tauzin's letter, and again ask for a serious, independent investigation of the Western Energy market. The letter reiterates the request for access to FERC documents obtained by the Committee. 2003 January 9, 2003--The California Democratic Congressional Delegation writes to the Chairman of the Federal Regulatory Energy Commission (FERC) Patrick Wood, III, to reject the findings of Administrative Law Judge Bruce Birchman (Refund Case EL00-95-045) because he recommended that energy generators who supplied power to California during the 2000- 2001 energy crisis owe far less than the $8.9 billion that California is seeking. March 3, 2003--The California parties (including the Governor and the Attorney General of California, the California Public Utilities Commission, and the state's major independently-owned utilities) present to the Commission more than 1,000 pages of evidence of widespread market power abuse and market manipulation. The California parties had to go to the Ninth Circuit Court of Appeals to force the Commission to allow them to discover and present this evidence. March 26, 2003--The Federal Energy Regulatory Commission (FERC) released a detailed report on the California Energy crisis, concluding that there was widespread manipulation in the California energy market. However, FERC did not propose increasing refunds substantially to reflect the gaming that took place. In particular, FERC continued to insist that the State of California could not receive refunds on the short- term electricity purchases it made to keep the lights on. April 2, 2003--During the Energy and Commerce Committee markup of the Energy Policy Act (H.R. 6) Rep. Eshoo offers an amendment to increase the refunds for California consumers by $5 billion. The amendment simply required the Federal Energy Regulatory Commission (FERC) to refund all ``unjust and unreasonable'' charges the State of California incurred for the short-term energy purchases it made to keep the lights on during the California energy crisis in 2001. The amendment failed on a vote of 21 to 30 in the Energy and Commerce Committee. Rep. Eshoo, supported by the California Democratic Congressional Delegation, attempts to bring the amendment to the floor for consideration several days later but not one California Republican would support the amendment and it wasn't considered. September 25, 2003--31 Members of the California Democratic Congressional Delegation write to FERC Chairman Wood reiterating previous concerns that FERC is having a poor record in defending the interests of California consumers, lacks an effective price mitigation plan, refuses to order the renegotiation of unjust and unreasonable long-term contracts, and has thus far short-changed consumers in the refund proceedings. 2004 May 6, 2004--An amicus brief is filed at the 9th Circuit Court regarding FERC and California energy refunds signed by 37 parties: California's 2 Senators, 33 House California Democrats, State Senate President Pro Tem John Burton, and State Assembly Speaker Fabian Nunez. The brief supports the California parties' lawsuit that FERC follow the Court's order to use the existing Remedy Proceeding--a forum subject to judicial review--to collect evidence of energy market manipulation, rather than non-public investigatory proceedings that shut CA consumers out of the process. June 2, 2004--CBS News broadcasts tapes unearthed by Snohomish Public Utility District which capture Enron traders bragging in profane terms about their effort to manipulate the Western Energy Market. June 14, 2004--All 33 California House Democrats write to FERC to request that it address the issues raised by the Enron tapes. June 15, 2004--The House defeats motion to recommit H.R. 4305, the Energy Policy Act of 2004, 192-230 (Roll Call Vote 240). The motion would have added language to the bill that will enable California consumers to receive equitable refunds.

Ms. ESHOO

Ms. ESHOO. Mr. Chairman, I thank the distinguished ranking member for her leadership in the committee, and to the chairman of the full committee, who has given much for this country, both in service and in representing his congressional district, as well as this committee, I salute him, and we all salute him for it. To the gentleman from Nebraska (Mr. Bereuter), who will be leaving the House of Representatives, I salute him as well for his wonderful service on the House Permanent Select Committee on Intelligence. Mr. Chairman, last week was really quite an extraordinary week for those of us who serve on the House Permanent Select Committee on Intelligence. Breaking with past precedent, all committee Democrats voted against the intelligence authorization bill in the committee markup. And there was one primary reason for that, and that is that counterterrorism is underfunded significantly, by two-thirds, in this authorization bill. I have said more than once you cannot have a 100 percent commitment to counterterrorism and the global war on terrorism if you are only going to fund it by 33 percent. We have failed, I believe, to do everything we can to strengthen the oversight. Truth is the oxygen of democracy, and it is the responsibility of members of the House Permanent Select Committee on Intelligence to pursue the truth through strong oversight. We offered amendments to fully fund the intelligence community's counterintelligence operations, and we offered amendments in the committee to strengthen oversight. They were rejected by the majority. I offered the amendment at getting the straight story on the Defense Department's relationship with a man by the name of Ahmad Chalabi. I want to know why the Department invested so much political and financial capital in a man with such a checkered past. The CIA terminated its relationship with him because it found him to be unreliable. The State Department could not account for how he was spending U.S. Government funds. And despite the obvious warning signs, the Defense Department could not wait to give him more money. Now we are finding out that Mr. Chalabi's organization may have fed the intelligence community misleading or fabricated information on Iraq's weapons of mass destruction. He may have been instrumental in persuading the administration that the Iraqi people would welcome U.S. soldiers with open arms, rather than improvised explosive devices. That is why we have come to the floor. That is why we have come to the floor with our objections. Bipartisanship means that people come together. It does not mean that one side stands and says, you have to meet us 100 percent in order to make it bipartisan. We should be able to agree on the money for counterterrorism and for stronger oversight.

Ms. ESHOO

Ms. ESHOO. Mr. Speaker, I thank the gentlewoman for yielding me time. Mr. Speaker, I join my colleagues in congratulating the chairman, who has served so honorably as a Member of the House and for all of these years as chairman of the Permanent Select Committee on Intelligence, and wish him our absolute best. I join my colleagues today in standing up in support of stronger intelligence. That is what this debate is about. This bill is simply too weak and dangerously underfunds the intelligence efforts that are so absolutely essential to preventing the next big terrorist attack. Every American will understand that 100 percent is 100 percent. You cannot be committed 100 percent to funding if you only fund 33 percent, one-third, of the entire counterterrorism budget. Opponents of the amendment to fully fund counterterrorism intelligence throw around a lot of numbers to try to argue that the level of funding in this bill is adequate. But you need to know only one thing: The President knows this is not enough funding, and said in his transmittal letter of May 12 of this year that he will ask for the rest of the money ``in early 2005.'' That is an admission that this is not fully funded, and that is what we are debating. The problem is the terrorists are not waiting until early 2005. There are indications that they plan to conduct a major attack inside the United States before the end of the year, according to administration officials. The CIA cannot wait until early 2005 to plan its operations to prevent that next attack. Senior officials testified repeatedly to the Permanent Select Committee on Intelligence that the practice of funding counterterrorism by supplemental makes it impossible for them to plan, this is what they said to all of the members of the Permanent Select Committee on Intelligence, and it forces them to rob Peter to pay Paul in an effort to make due. Does this body really want to make the men and women of the intelligence community make do when so much is at stake? They are the tip of the spear. We have to give them the resources they need. It is our job now, not in early 2005.