John Edwards

Mr. EDWARDS

Mr. EDWARDS. Mr. President, I rise today to introduce the Sweepstakes Toll-Free Option Protection Act of 1999, the ``STOP Act.'' I hope this measure will help put a stop to a practice I find extremely troublesome: the flooding of consumers' mailboxes with unwanted and misleading sweepstakes mailings. The Permanent Subcommittee on Investigations recently held hearings on deceptive mailings and sweepstakes promotions. I'd like to thank Senators Collins and Levin for bringing this important issue to light. Mr. President, during the course of these hearings, it became clear to me that strong measures must be taken to curb the use of misleading sweepstakes promotions. Too many people are getting swamped with solicitations. And too many people are spending their life savings trying to win prizes. The primary victims are our nation's elderly who are led to believe that if they purchase magazine subscriptions or other products, they will increase their chances of winning. Well, purchases do not increase the chances of winning. But often times, what purchases actually do is increase the number of solicitations sweepstakes companies send out to people, encouraging them to buy even more products. With each new purchase, consumers are led to believe that they are coming closer and closer to winning a prize. The sad truth is they are not getting closer, but the cycle of deception keeps going. The legislation I am introducing today would require sweepstakes companies to set up a uniform toll-free telephone number that consumers can call to have their names and addresses removed from all sweepstakes mailing lists. People will no longer have to contact each and every sweepstakes promoter to stop these misleading mailings. My legislation is a sensible approach to helping regular people who want to stop the flood of sweepstakes mailings and protect themselves from misleading solicitations. Let me tell you the story of Bobby Bagwell to help illustrate the need for this measure. One day, Pamela Bagwell went to visit her elderly father-in-law, Bobby. When she arrived at Bobby's home, Pamela found stacks and stacks of solicitations from sweepstakes companies. She asked Bobby about them and found out that he had made numerous purchases thinking that buying products would increase his chances of winning a prize. He was so convinced he would win a prize that he even invited his neighbors to his house on the day that the Publishers Clearing House prize patrol was supposed to deliver the grand prize check. Pamela estimates that Bobby spent more than $20,000 in 10 months on products he thought would help his chance of winning. Now as I mentioned before, Bobby is an elderly man. But this is not the worst part of this story. Bobby also has dementia. Pamela, who has power of attorney for Bobby, contacted Publishers Clearing House at least 6 times in October last year to demand that the company stop sending Bobby solicitations. She even went so far as to send the company a doctor's certification that Bobby has dementia. And yet, the sweepstakes mailings continued to flood Bobby's mailbox. Pamela said that sometimes Bobby was receiving up to twenty per day, from many different companies. During the hearings, I asked representatives from the four major sweepstakes companies, Publishers Clearing House, Time, American Family Enterprises and Reader's Digest, to check their records and remove Bobby's name and address from their mailing lists. All of the companies agreed to do so. However, I find it unacceptable that the only recourse someone like Pamela has is to hope that a United States Senator makes such a request for her. Pamela and Bobby Bagwell's situation is not unique. Since the hearings, my office has received numerous calls and letters, not just from North Carolinians, but from people all over the country who tell similar, disturbing stories about their experiences with sweepstakes companies. Mr. President, my proposal is a reasonable way to help them. I believe that people should have the right to easily put a stop to these mailings. And sweepstakes promoters should be legally required to honor such a request. Now let me tell you how my legislation would work. First, as I have already mentioned, it requires that sweepstakes companies set up a uniform toll-free number that individuals or people with power of attorney for such individuals, can call to get their name and address removed from all sweepstakes mailing lists. After a person places that one phone call, they will receive a removal request form to fill out and send in to the notification system. After the system receives that form, the person's name will be removed from all sweepstakes mailing lists. The form will serve as written evidence that the person made a request to have their name removed. Second, the sweepstakes companies must include a statement in their mailings that people have the option of having their names removed from sweepstakes mailing lists and that they can initiate this process by calling the specific toll-free number that has been established. The statement must be clear and conspicuous, which is important in order to effectively alert people about their right to stop the mailings. Finally, my bill requires that if an individual makes a request to have their name removed from sweepstakes mailings lists, the sweepstakes companies must comply with this request. If the companies continue to send mailings against the wishes of the caller, each mailing will subject the company to a $10,000 civil penalty. Mr. President, in closing, I should mention that the American Association of Retired Persons participated in the sweepstakes hearings and testified as to ``the severe effects'' deceptive sweepstakes mailings have on AARP members. AARP supports my idea of a toll-free uniform notification system. My legislation is a common sense solution to a growing problem, and I am confident that it will indeed go a long way toward stopping harrassing, deceptive sweepstakes mailings. I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. EDWARDS

Mr. EDWARDS. Thank you, I say to Senator Boxer. I will add to what she just said: When you do good things and have the impact that the Community Reinvestment Act has had, it does not just inure to the benefit of the people who are directly affected, it inures to the benefit of all of us.

Mr. EDWARDS. Yes, I say to Senator Boxer, I am aware of that, and that is what I have been told consistently by the banks located in North Carolina.

Mr. EDWARDS. I think it is, too. He says, ``My company supports the Community Reinvestment Act both in spirit and in fact. We have gone way beyond its requirements. We have had fun doing it. And we have made a business out of it.'' Now, here is the head of the largest, or one of the largest, banks in the country, headquartered in my home State. I happen to know that Mr. McColl has, in fact, strongly supported the Community Reinvestment Act. His bank has gone above and beyond the call of duty in that respect.

Mr. EDWARDS. Yes, absolutely. I am aware, I say to Senator Boxer, of the comment by Hugh McColl, who is head of Bank of America. I think I can quote him exactly.

Mr. EDWARDS. Of course.

Mr. EDWARDS. Absolutely.

Mr. EDWARDS. That is exactly the response I have had. I thank the Senator. Mr. President, I seek recognition at this time.

Mr. EDWARDS. Thank you. I am wondering, Senator Bayh, if you have had the same experience I have had. That is, I come from a State with many banks, including some of the largest banks in America, Bank of America being one. And having had many conversations with representatives of banks that are headquartered in my State, what I hear from them is, in fact, they enjoy participating in the Community Reinvestment Act. They take great pride in the work they do in the communities where they are located. They have absolutely no opposition to the Community Reinvestment Act and, in fact, do not oppose the Community Reinvestment Act provisions of the Democratic substitute offered by Senator Sarbanes. I am just curious whether the banks in your State of Indiana have had the same kind of reaction.

Mr. EDWARDS. Would the Senator from Indiana yield for a question?

Mr. EDWARDS. I thank the Senator for his kind comments. He and I share the same feelings about each other. We share a lot of the same beliefs and values. There is no question that in the State of North Carolina we have had the same experience they have had in Indiana, which is that the Community Reinvestment Act, in fact, reaches out into rural, underserved communities, to small farmers, small businesses and communities that are chronically and economically disadvantaged and so desperately need its help. I think it is another example of how well the CRA has worked. Several Senators addressed the Chair.

Mr. EDWARDS. Yes.

Mr. EDWARDS. I think that is a wonderful indication, as the Senator put it, of the people on the ground, on the spot, seeing what is happening on a day-to-day basis, recognizing how critically important CRA is to this country. They see what is happening. I think it goes hand in hand with the fact that the banks--and I might add, I take great pride in the fact that every bank in North Carolina has a satisfactory CRA rating, every single one of them--are helping make a difference. I think the fact that the mayors are behind it, the fact that the community groups are behind it, the fact that the banks themselves, the financial institutions, are behind it, I think all these things in combination go to prove a very simple point: The Community Reinvestment Act has been good for America. It is good for the specific groups it directly benefits, and it is good for all of us as Americans because it allows these folks to support themselves, which is what they want to do.

Mr. EDWARDS. Yes.

Mr. EDWARDS. That is my understanding. So we start with this basic idea that 99 percent of all the CRA- covered applications are not challenged at all. Then of the ones that are challenged, in only 1 percent of those cases are the applications denied. So 1 percent are challenged versus 99 percent that are not, and of that 1 percent, only 1 percent of those are denied. I think the facts prove that CRA has not been an enormous regulatory burden and that banks, as has been the experience of Senator Bayh, as has been the experience of Senator Dodd in Connecticut, and as has been my experience in talking to my bankers in North Carolina, the reality is they do not oppose the Community Reinvestment Act. They simply do not. As the quote from Hugh McColl indicated earlier, banks take great pride in their opportunities to invest in their community. Our banks are good corporate citizens who do what they do because they take pride in it. They believe in the Community Reinvestment Act. They support it. They are not opposed to it. Finally, this chart depicts what CRA has done in loans to low- and moderate-income communities. This is as of 1997, $34 billion in small business loans. I think it is really important that we understand we are not just talking about housing. We are talking about small businesses, entrepreneurs who want to get started and just need a leg up, giving them a chance to develop their own business, $34 billion as a result of the Community Reinvestment Act; $18.6 billion in community development, the kind of community development that we saw photographs of just a few moments ago; and critically important to my State of North Carolina--and I suspect Senator Bayh's State of Indiana--$11 billion in small farm loans. That is $11 billion going to small farmers as a result of the Community Reinvestment Act. Here is what we have. We have a bill that makes a great deal of sense on the whole. We want to expand the services of banks. We believe--at least I believe--that banks ought to be able to engage in those services. But it is critically important that we maintain the viability and the vitality of the Community Reinvestment Act. It is important that we maintain it for a lot of reasons: because we need to support minorities; we need to support the elderly; we need to support low- income families; we need to support people who need or want to start their own small business or their own family farm. It makes good business economic sense for the country. But what I want the American people to hear from me today, if they hear nothing else, is that this is not some obscure piece of banking legislation that is technical or difficult to understand. This legislation can affect their lives and, in fact, will affect the lives of every American every day because to the extent that we keep poor families together, to the extent that we reduce crime in this country, to the extent that we give people an opportunity to seek out good employment, to get jobs to support their own families--all those things that we as Americans believe in--when we do those things in conjunction, we as a country benefit. And to the extent that we look at it selfishly, we as individuals benefit because those people will not be supported by the Government. They won't be supported by taxpayers. They will support themselves. And the reality is that is exactly what they want. They want the opportunity to support themselves and to know the pride of homeownership. That is what community reinvestment is all about. That is the reason Senators Sarbanes, Kerry, Bayh, Dodd, and myself believe in it so deeply.

Mr. EDWARDS. I want to address that in just a moment. I want to say, first, in relation to the remarks of my friend, the Senator from Indiana, who has become a very close friend and colleague of mine during our tenure--we came to the Senate together--that I am proud of what he had to say. I completely agree with everything he had to say, and his remarks particularly about turning back the clock on this very, very important piece of legislation ring true with me and I think ring true with most Americans. Mr. President, if I may, there is a really critical thing I want Americans, who are listening to this debate, to understand. This is not some obscure piece of banking legislation that has nothing to do with their lives. It is really important for Americans to understand that this bill--I refer now to Senator Gramm's bill--that this bill will have, or has the potential to have, a dramatic effect on the lives of every American, not just the poor, not just minorities, not just the elderly, not just those who run a small business or want to get into the family farming business, and not just those people who are directly impacted by the Community Reinvestment Act. This bill has the potential to affect every single one of us, every single American. And here is why. Because it weakens the Community Reinvestment Act. Because of CRA, we provide low-income housing, we provide single-family housing, we give families a place to live, we give small businessmen and women, minority and otherwise, a chance to engage in entrepreneurship, to open their own business. We give the people the opportunity, in my home State of North Carolina, to start a small farm, and expand that farm. Every time we provide these kinds of economic opportunities to people, every time we give families, core families, a chance to live together, to stay together, and not be spread out, we do a number of things: No. 1, we reduce crime; No. 2, we create pride, an extraordinary amount of self-esteem that may not have existed before; and we give people an opportunity to do something they otherwise might not be able to do--own their own home or open their own business. I speak to every American when I say, crime, core family values, the fact that the folks who benefit directly from the Community Reinvestment Act are folks that we may otherwise, as a Government, have to support, these are things that affect every American. This bill is not some obscure banking bill that has nothing to do with people's lives. The Community Reivestment Act has a dramatic effect and has had a dramatic effect on every single American. I think it is critically important for people to understand that. I think it is also important for them to understand what exactly Senator Gramm's bill does to the existence of the Community Reinvestment Act. I have heard the bill described by him and others as being ``Community Reinvestment Act neutral,'' as to the overall purposes of this legislation. I might add parenthetically that I strongly support the idea that banks ought to be able to expand services and affiliate with other financial institutions. They ought to be able to sell insurance. They ought to be able to sell securities. It is good for banks. We have a lot of banks in my State that need to do this and want to do it and, I think, ought to be able to do it. It is also good for consumers because it creates competition, and it is a good thing for consumers to have access to these services when they go to their banks. I strongly support those opportunities. Here is the problem. Under existing law, when a bank seeks to expand, either by merger or by opening a branch, then its CRA rating is one of the things that is taken into consideration. Under the provision that is proposed by Senator Gramm, when a bank seeks to expand services by affiliating with a company that sells insurance, by affiliating with a company that sells securities, CRA, or the Community Reinvestment Act, plays no role whatsoever. Let me say this in the simplest terms. A bank with a completely unsatisfactory Community Reinvestment Act rating that has been determined by regulators to not be complying with the law, to not be doing what it should be doing with respect to investing in its community, I am talking about a totally noncompliant bank, that factor cannot even be taken into consideration in determining whether that bank should be allowed to sell insurance and whether it should be allowed to sell securities. This bill, Senator Gramm's bill, is not CRA neutral for one simple reason. We are, by virtue of this law, expanding what banks can do, allowing them to sell insurance, allowing them to sell securities. If we don't take CRA, which presently applies to applications for branching and mergers, and apply it as a precondition for these new services they are going to engage in, then we have withdrawn from CRA. We will have cut the underpinnings from CRA. It is something we shouldn't do--it is fundamental--we shouldn't do. CRA compliance ought to be a consideration when banks seek to engage in the expanded services permitted under this bill in exactly the same way, in exactly the same fashion that it presently applies to their attempts to merge with other banks or to their attempts to open other branches. Now, I want to show a couple of examples with the indulgence of my colleagues. I want to show a couple examples of what the Community Reinvestment Act has done in North Carolina. I show now a photograph of a neighborhood, an economically disadvantaged neighborhood, a minority neighborhood in Durham, NC. This is a house that existed in that neighborhood. As a result of the Community Reinvestment Act, and as a result of a bank partnering with local community groups, this house that we have just taken a look at was turned into this house. If I could hold up the first photo just a minute, this was a crime- ridden, drug-infested community. As a result of the Community Reinvestment Act, we went from this to this--a place that the people who occupy this home are proud of; a low-income family was able to reside there. They take pride in their community. And as Reverend Brooks, who was part of this effort, said: Before, there were drug dealers sitting on this corner. Now, we have homeowners hoping to be in these houses. The Community Reinvestment Act. It changes communities. It changes families. It changes people's lives. It also changes the financial obligations that the rest of us, as Americans, have to support opportunities for people who want to support themselves. They just need a chance. What the Community Reinvestment Act does is, it gives those folks a chance. I want to show one last photo. We have seen one house. This is a neighborhood. This is located in Durham, NC. This is a neighborhood that, again, has gone from a high-crime, drug-dealers-on-the-street- corner neighborhood to a model community. Can you imagine the difference between the way a family feels when they live in a community where right outside their doorstep people are selling drugs and all the houses are in terrible shape versus how they feel when they find themselves in a community that looks like this? Now they take pride in their community. The children growing up in this community take pride in where they live. It gives them a sense of self-esteem. It allows them an opportunity to have pride in themselves and their family that they otherwise might not have. Now, there are some simple facts that I will speak to briefly that have emerged from the progress of the Community Reinvestment Act during the time it has been in place. If I could have the appropriate chart, please. First of all, just since 1993, the private sector lending in low- and moderate-income areas, which is what we have been concerned with, has risen. From 1993, I guess this is the number of loans, 185,014 to 268,463 in 1997. Over a period of 4 years, there is an increase of 45 percent, almost a 50-percent increase in just 4 years, as a result of the Community Reinvestment Act. The argument is made that--and we have heard a lot of it from Senator Gramm over the course of the last 45 minutes to an hour--that the Community Reinvestment Act places an enormous regulatory burden on banks, unfairly so. Well, I think, unfortunately, with all due respect to Senator Gramm, the facts do not bear that argument out. What we find is that among CRA-covered institutions, when they make an application, for example, when a bank decides they are going to merge with another bank, when a bank decides they are going to expand and open a branch, and therefore they file a CRA application, 99 percent of those applications are never even challenged by community groups. So we start with a base of 99 percent where there is no challenge whatsoever. I would love the comments of Senator Sarbanes on this in a moment, if he will. It is my understanding that the banks are not required to keep additional information as a result of this expansion of services. In fact, I think they use exactly the same base data that they kept previously. Is that correct, Senator Sarbanes?

Mr. EDWARDS

Mr. EDWARDS. I do believe, and I know my colleague will agree with me, that the vast majority of these companies are totally responsible. They want to cure these problems. And in fact, they will cure them, and as a result will never be involved in any of this process.

Mr. EDWARDS. Mr. President, let me say to my friend, the Senator from Oregon, that I have great respect for him. He knows that. He has spent a tremendous amount of time and work on this project, along with Senator McCain, for whom I also have tremendous respect, along with my great and dear friend, Senator Dodd from Connecticut. All three have spent a tremendous amount of time on this issue. I will say at the outset that, from my perspective, I do believe we need to provide the kind of support and help for the high-tech community in this country that it so richly deserves. It is a critical issue not only in Oregon but also in North Carolina. We take great pride in our high-tech community, particularly in the Research Triangle area of North Carolina. My problem is that I don't think this bill strikes a proper balance. I think it fails to do so in a number of ways. I will candidly admit that I am not fully familiar with some of the discussions and negotiations going on right now. We will have to see the final product. I only have the bill as it is before us now to discuss. First, I think there is an enormous problem in doing at least one of the things that this bill does, which is to relieve, in some ways, businesses and corporations from accountability or responsibility, particularly in a day and age when we as Americans are saying to our children, to our families, that they need to be responsible for what they do. We need to be personally responsible and accountable for everything we do. How do we say to the children and families of America that they are accountable and responsible, fully, for everything they do, while at the same time passing legislation in the Congress of the United States saying that a particular slice of corporate America is not fully accountable and responsible for what it does? I think the reality is that it sends a terrible message to our children and to our families. I think what they want to hear from us is that every American, every child, woman, family, parent and every business is, in fact, fully accountable and responsible for what they do, because we as Americans believe in personal responsibility and accountability. Now, I want to talk about a couple of things by way of background. First, we are tinkering here with a civil jury system that has existed in this country for over 200 years. Whenever you tinker around the margins with a system with checks and balances, which has been at work for a long period of time, you create an enormous potential for trouble. That is exactly what this bill does. The argument is made on behalf of this bill that it will decrease litigation, that it will help with this anticipated but still fictional litigation explosion. The reality is that bill creates a morass of potential litigation. It creates new terminology. It creates new definitions, and it has descriptions of legal avenues that can be pursued that have not existed heretofore. The jury system that we have in this country has been developed over a long period of time. There are many trial and appellate decisions that we can rely on and depend on. This bill creates a whole new genre of litigation and appellate decisions. There will be enormous fights over some of the language in this bill. More importantly, one of the things this bill does is it dilutes the jury system. The reality is, if you believe in democracy, you believe in the jury system, because the jury system is nothing but a microcosm of democracy. Speaking for myself, and I think speaking for most Americans, I have tremendous faith--in fact, I would go so far as to say I have a boundless faith--in the Americans who sit on juries all over this country every day who render justice and render fair decisions, fair to both sides, in any litigation. This bill dilutes the responsibility that we give those Americans. I personally have more confidence in regular Americans, North Carolinians, farmers, bankers, people who work in stores, people who are engaged in all walks of life, who come in and sit on the jury, hear cases, and do what they think is right. I have more confidence in them than I do in us as a body trying to impose upon them what we think is fair and just across the board. Those juries hear the facts; they hear the circumstances from both sides, and they render justice. They do what they think is fair and right. Anybody, as I said earlier, who believes and has confidence in Americans who sit on those juries, knows that the decisionmaking should stay right where it is--with the jury. Let me talk for just a minute about this Y2K problem, because this is not a new problem. The history of this problem is, I think, greatly educational in terms of where we are. If I could look at a chart, the title of this chart is ``Y2K. Why do today what you can put off 'til tomorrow?" This is not a new problem. I might add that, along with Senators Dodd and Bennett, I also serve on the Y2K committee. We have learned a great deal through the hearings that have taken place on that committee. For example, in 1960, Robert Bemer, who was a pioneer in computer sciences, advocated the use of a four-digit rather than a two-digit date format. This is now 39 years ago--almost 40 years ago. One of the pioneers of American computer science said it is an enormous mistake to go to a two-digit system instead of a four-digit system. In 1979, he wrote again, the same Robert Bemer, in a computer publication about the inevitable Y2K problems, unless this defect is remedied. He warned, ``Don't drop the first two digits. The program may well fail from an ambiguity in the year 2000.'' We have known about it for 40 years. In 1979, 20 years ago, he is telling the industry you have to do something about this, and you have to do something about it now. In 1983, an early Y2K-fix software was marketed and sold in this country which dealt with the Y2K problem. How many copies of that software were sold? Two copies of this software that addressed this problem were sold. In 1984, just 1 year later, ``Computerworld'' magazine said, ``The problem you may not know you have,'' and they warned companies to start making modifications now--in 1984, 15 years ago. In 1986, there was a publication by another computer magazine where IBM asserted: ``IBM and other vendors have known about this problem for many years. This problem is fully understood by IBM software developers who anticipate no difficulty in programming around it.'' Then in 1988, the National Institute of Standards and Technology said, ``NIST highly recommends that four-digit year elements be used''--11 years ago. In 1989, the Social Security Administration's computer experts found that the overpayment recoupment systems did not work for dates after 2000, and realized that 35 million lines of code had to be reviewed. Finally, in 1996, Senator Moynihan requested the Congressional Research Service report on Y2K. It predicted widespread massive failures. He introduced legislation to create a special office for Y2K problems and to establish compliance deadlines. It died in committee. Finally, in 1999, this year, Bill Gates blamed Y2K on those who ``love to tell tales of fear.'' At the same time, Microsoft was still shipping products that were not Y2K compliant. My point is a simple one. This Y2K problem has been around for 40 years. Those folks who are involved in this business have known about it. The truth is that many of the people involved in the computer industry have worked hard at correcting this problem. They have addressed it in a very responsible way. Those people will have no liability and no responsibility from any failures that occur. The people who I think make up a great deal of the high-tech industry, who have acted responsibly, who have recognized that this is a problem, who have gone out to the people who they have sold their products to, and done everything in their power to correct this problem, those people have no responsibility. Under the current legal system, they have absolutely no responsibility. They can't be held responsible. The people who can be held responsible are those who have known about this problem for 40 years and have done nothing to correct it, and, in fact, over the course of the last few years have continued to sell products that are not Y2K compliant, and are not concerned about the result. They have their product sold. They have their money in, and they have let the people who bought the product worry about the problem, or it would be dealt with later. We have no business in this Senate providing protection for people who have engaged in that kind of behavior. That is exactly what this bill does. It has a number of problems in it. Let me just talk about a few of them briefly. First, my friend, the Senator from Oregon, mentioned a few minutes ago that he thought it was important for punitive damages that we be able to send a powerful message to those who had acted irresponsibly and recklessly. This bill places enormous limits on punitive damages that can be awarded, punitive damages that under existing law--if this bill never goes anywhere, never passes, never becomes law, as I stand here today, businesses can only be held accountable for punitive damages if they have engaged in reckless, egregious, willful, sometimes criminal, conduct. It is the only circumstance in which a business can be held liable for punitive damages. My friend, the Senator from South Carolina, who just joined us, is fully aware of that. We have an existing law that provides that protection. ``Joint and several liability'' are terms that lawyers use regularly. But they are critically important terms. The terminology that we hear used by my friend, Senator Dodd, and Senator Wyden, is ``proportionate liability.'' It is very important for the American people to understand what this bill will do to them if it passes. Let me give an example. A small business man--say a grocery store owner--buys a computer system that is necessary to run his business on a day-to-day basis. This is a family business. The system fails. As a result of the system failing, he is unable to keep his doors open over a period of 2, 3, or 4 months. All of these businesses operate on very short-term cash flow. They need money, and they need it on a daily basis. If they don't have it because the computer fails, they get run out of the business. So we have this family-owned grocery store that has been run out of business because their computer system didn't work. Keep in mind, we are talking about a regular American who runs a business. These are not computer experts. They are not experts in lawsuits and litigation. They don't know what they are supposed to do. In my example, they discover that three different companies participated in making their computer system. So they bring an action against those three companies to recover for the cost of what happened with their system and for the fact they have now been put out of business. Any fair-minded American would say if these companies knew about the problem, knew they had sold them a product that was defective, they ought to be held responsible for that. Joint and several liability says each one of those companies can be held liable and responsible for what happened to this family grocery store. This bill says if for some reason one of those three companies is out of business, you can't collect against the other two. Maybe one of the three is an offshore company--which will be true on many occasions with respect to this kind of case--and you can't reach it. Then, because of this bill, you can't reach the other two. This bill says the innocent grocery store owner bears that share of the responsibility. Joint and several liability, which has existed in this country for 200 years, exists for a very simple reason: It is just, and it is fair. We have a choice: Somebody is going to suffer this damage. Should the cost of this damage be paid by the absolutely innocent grocery store owner? Or should it be paid and shared by the defendants who were guilty? It is that simple. It is the guilty on one side, the innocent on the other. The question is, Who is going to share in paying for the damage that has been done? Joint and several liability says that responsibility is borne by the guilty and is never to be borne by the innocent. That is the reason that system has existed. This bill, first of all, essentially eliminates joint and several liability as a starting place. Then it sets up a complex--I am a lawyer and I can barely understand what it says--exception which creates certain circumstances where this grocery store owner can make an effort to collect some of his money from the other defendants if, in fact, there is an uncollectible defendant. But he has to jump through lots of hoops and he has to do it in 6 months, which is the time limitation. Having been in the trenches for 20 years doing these cases, it is almost an impossible task to finish the process of trying to collect in 6 months. The bottom line is, it creates a very narrow exception and puts the burden entirely on the innocent party to jump through these hoops. It makes absolutely no sense. The system that exists in America and has existed for 200 years exists for a good reason. It has been fair and just for 200 years. It is fair and just now. There is absolutely no reason to change it. It makes no sense to change it. Let me use the chart that my friend, Senator Leahy, referred to earlier--and he did a beautiful job of that. Across the top of this chart is the present justice system. I want to emphasize for Americans who are listening that no computer company or high-tech company can be held responsible under existing law unless they have acted negligently or irresponsibly. Under this jury system that we have in this country today, we have a very simple process. We go through the process of making a claim and seeing if they respond to the claim. If they don't, a lawsuit is filed, the case is eventually heard, and there is a result. Or, on the other hand, as happens in almost 99 percent of the cases, if the company recognizes that the problem was their responsibility, they pay for it. They settle the case, because they know they have a responsibility to pay for what they caused. So we have a quick, fair settlement or we have a fair trial. We have a system that is in place and has existed for 200 years and systems that work State by State. I have to add to this, I don't know why we as a Senate and as a Congress think we are so much smarter than our State legislatures that have passed laws over many years and have court systems that deal with these problems. They are fully capable of addressing this problem. I personally believe if this were an issue, it could easily be addressed at the State level. The reality is, the existing system that we have will work. It is simple. It is streamlined. And it will get a fair result for everyone concerned. On the other hand, if we enact this morass that I have in my hand right now, what we will have is the biggest mess anybody has ever seen in the court system. First of all, all the cases are going to go to Federal court instead of State court. The National Judicial Conference has said the Federal judicial system is already overburdened before they ever get these cases. They don't have enough resources; they don't have enough judges. What we are about to do is dump an enormous pile of new cases in the Federal judicial system which they don't want and which they don't have the resources to handle. We start this complicated process, and without going through all the details--Senator Leahy has outlined it beautifully--it is one roadblock after another to the innocent party, the grocery store owner, the guy who was put out of business because his computer system wouldn't work and he had nothing to do with it. Every time he moves, he runs into another roadblock. He doesn't have the resources to fight this battle. It is a long and tortuous process that ultimately makes no sense. We have a system that works. There is no reason to do this. Let me give an example of problems we create in a bill like this. There is a provision in this bill that says in any lawsuit a defendant can raise Y2K as a defense. If you have one business suing another business for a contract--no matter what the claim is about; it could be about anything--and the defendant says, wait a minute, this is a Y2K computer problem, all of a sudden you have triggered enormous, procedural, bureaucratic hurdles that have to be jumped through. The case goes into Federal court. We have this big mess. A tool has been created to complicate a simple lawsuit that could be over and resolved in very simple fashion. I don't suggest for a minute that the people who crafted this bill don't have the very best intentions. I believe they do. I myself--and I only speak for myself--have no problem with the idea that we ought to try to provide incentives for people who are engaged in disputes to resolve those disputes. Alternative dispute resolution, I think, is fine. A cooling off, some period when these folks can talk to each other and try to work it out is fine. I think, if there is a problem, we want to promote discussion between the innocent person who bought the computer system and the people who make it. I think we want to do all of those things. Those are laudable goals. The problem is what we have here is an extremist version of a bill that takes away rights of the innocent party and creates enormous hurdles to that innocent party ultimately recovering. I might add, I think this is unintentional. But the proposal makes the recovery of economic losses virtually impossible. Here is the reason. When I say economic losses, for example in my grocery store story, the recovery of the cost of the computer would not be considered an economic loss. But the fact that these folks have been put out of business and their grocery store is not in business anymore and they have lost the profits they would have made in their grocery store for X number of years, all because of an irresponsible computer maker that would be an economic loss. Well, in order to recover those economic losses that they had nothing to do with--they are totally innocent--in order to recover for those injuries, they have to have a written contract, or a contract that says they can recover under the terms of this bill. Think about that. Use a little common sense here. How many Americans, small business men, who go out and buy a computer system have been thinking about: Well, I better make sure I have a written contract that says if my computer system fails I can recover my losses, my economic losses--my lost sales, my lost profits as a result? The reality is, to the extent there is any contract other than a handshake or walking in the store and buying the computer system, the contracts are drafted by the manufacturers, because they are the ones with the lawyers, a big team of lawyers. They draft these contracts. If anything, they are only signed by the purchasers. So the likelihood that these contracts are going to have any provision in them for the recovery of economic losses is almost nonexistent. The bottom line is this. I think the intention of my colleagues, Senator McCain, Senator Wyden, Senator Dodd--I have absolutely no doubt their intentions are only the best. They want to do exactly what they say they want to do, which is to create incentives for these high-tech companies to correct these problems and not to create, from their perspective, a morass of litigation. The problem is this bill does not do that. I spent many years in the trenches, in courtrooms, fighting these battles. I can respectfully say that I have read the entire bill. It has numerous problems, including some of the ones I have described today. But I do believe we could fashion a bill, I say to Senator McCain, who has just arrived--fashion a bill that would accomplish some of the things they want to accomplish, which is instead of going straight to litigation, have folks talking to one another, working out the problem, curing the problems with the computers. That is in everybody's best interests. I want that. I think all of us here in the Senate want that. But it is my belief, having studied this bill and having studied it carefully--and I will concede I have not seen the most recent discussions because I don't think they have been put in writing yet-- but the version we have before us now is completely unacceptable and creates many more problems than it cures. Instead of reducing litigation, I think in fact it creates a vehicle for not only trial litigation but appellate litigation that will go on for many years to come.

Mr. EDWARDS. Mr. President, I yield the floor.

Mr. EDWARDS. I agree with that, and I would add, based on my conversations with the high-tech companies that do business in North Carolina, I am totally convinced they will act responsibly, they will do what they are supposed to do, and I do not think those are the companies that this bill addresses or that we are concerned about, in any event.

Mr. EDWARDS. I believe that is the case for that small number of companies this is all about.

Mr. EDWARDS. Yes.

Mr. EDWARDS

Mr. EDWARDS. Mr. President, I rise in opposition to this Republican lockbox for two very basic reasons: No. 1, it does nothing to extend the solvency of Social Security which we all, as Americans, ought to be concerned about; No. 2, the so-called lockbox is really no lockbox at all; it does not provide the protection we need. First, let me speak to this issue of the extension of the financial viability of Social Security. We know from projections that Social Security's financial viability is expected to last through the year 2034. This proposal does nothing to extend that time. It adds no funds to the Social Security fund at all. We have a very fundamental problem. This is not pocket money we are talking about; this is money that elderly Americans all over this country and in North Carolina depend on for their livelihood. For example, over 90 percent of Americans over the age of 65 depend on Social Security and receive Social Security benefits. Nine out of ten elderly Americans who have escaped poverty as a result of Government or Federal help have done so as a result of Social Security. In my home State of North Carolina, over half of the elderly would be in poverty--54 percent--in the absence of Social Security. I have a simple question and I think it is a question the American people ask: What will happen when the year 2034 arrives and these folks can no longer receive their Social Security payments? We made a promise to these people. They spent their lives working, doing exactly what they were obligated to do, paying their payroll taxes. Now the question is whether we, as a government, are going to meet our promise and our responsibilities to them. There is a second fundamental problem with this proposal. The lockbox is really no lockbox at all. It is a lockbox with lots of keys. The problem is, those keys are in the hands of folks who in the past have shown a willingness to let Social Security go to the side and instead use the money for tax cuts and other such things. What we need is a real lockbox, a lockbox that cannot be opened, a lockbox that does not have a provision, as this bill does, that provides for Social Security reform. This lockbox can be opened. The elderly Americans need to know this Social Security money is, in fact, locked. We need to do what is necessary to accomplish that. We have an obligation to our elderly Americans. We made them a promise. They fulfilled their part of that obligation. There is a fundamental question. If we are going to lock up this Social Security money, we need to lock it up in the correct way, in a way that it can't be reached. We need to do what is necessary to extend the life of Social Security. We have an obligation to do that. We have an obligation not to undermine the integrity of the Social Security system. We need to meet our promise and our obligation to elderly Americans who spent their whole lives working, expecting they would receive these benefits when they retired. I yield back the remainder of my time.

Mr. EDWARDS

Mr. EDWARDS. Mr. President, I rise today to introduce the ``Terry Sanford Commemoration Act of 1999.'' This measure would name the federal building in Raleigh, North Carolina after a great man, Terry Sanford. We lost Terry Sanford almost a year ago. The loss was great. He served North Carolina throughout his entire life. He was a Governor, a state Senator, a U.S. Senator, and a university president . He was trained as a lawyer. He wrote books, served as a paratrooper during World Was II, worked as an FBI agent and ran for President of the United States--twice. Senator Sanford died on April 18, 1998 after a long fight with esophageal cancer. He was a towering figure, a hero, to many North Carolinians. And we miss him. There is no doubt that when the history of North Carolina in the 20th Century is written, Terry Sanford will occupy many pages. And he will be given a great deal of credit for the great strides taken by North Carolina. Whatever Terry Sanford touched he made better. Senator Sanford's mother was a school teacher. His love of education must have started there. When he was governor he did whatever it took to increase funding for education. He even talked state legislators into voting for a food tax in order to fund education--that was not easy. Among other things, he helped found the North Carolina School for the Arts which was a pioneer, and to this day remains a leader in arts education. After he finished his term as governor, he became President of Duke University. And he brought unparalleled ambition, vision and energy to making Duke University great. But the list of Senator Sanford's accomplishments does not stop with education. He launched innovative anti-poverty programs. He helped start the North Carolina State Board of Science and Technology. He was largely responsible for the creation of an environmental health sciences facility in Research Triangle Park. He helped calm the student protests over the Vietnam War. And finally, in the midst of a turbulent and difficult time, Terry helped us find a path across the racial divide. In his 1961 inaugural address, he let us know and understand that ``no group of our citizens can be denied the right to participate in the opportunities of first- class citizenship.'' He later said: ``The most difficult thing I did was the most invisible thing. That was to turn the attitude on the race.'' He turned the attitude in small and large ways. He invited prominent leaders in the African-American community to the Governor's Mansion for breakfast to talk about how to solve the race problem. Many of them later said that they never dreamed a day would come when their state's governor would invite them to breakfast. He started the Good Neighbor Council, which is now the North Carolina Human Relations Commission, to give structure and authority to his commitment to creating jobs for people regardless of race. And the thing about Senator Sanford is that he never stopped. Late in life, when he was no longer a Senator, University President or Governor, he kept coming up with great ideas and kept working to see them through to completion. He was a friend to me. And I valued his advice and counsel. Naming a building can never capture the spirit and heart of a man like Terry Sanford. But it is a fitting tribute. I ask unanimous consent that a copy of the legislation be printed in the Record.

Mr. EDWARDS

Mr. EDWARDS. We yield to the Senator from Massachusetts.