Barney Frank

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself such time as I may consume. I just want to address one important issue on this question of the industrial loan companies that the gentleman from Iowa had raised previously. It is clear, as we all agree, that the ILCs are in fact regulated. They are regulated by a Federal bank regulator, the FDIC. The element of unregulation goes with holding companies. Bank holding companies are regulated by the Federal Reserve. Heretofore, these holding companies have not had, in my experience, much independent existence and so the regulation by the FDIC has done it. I will say to the gentleman from Iowa, while he is not here right now, he has been very conscientious on this bill and is probably following this, that I would be prepared to work with him on the question of whether or not an appropriate form of regulation for the holding companies ought to exist. Perhaps the FDIC or some other entity should have it. I do not think we have a regulatory hole. We have not had one historically. I do not think we are creating one. But I would note the only potential argument is there would not be a regulation of the holding company. All of the bank activities of the ILCs would be regulated by the FDIC. Having said that, I just would repeat what the gentleman from Ohio essentially said. This is, I think, an effort to fine-tune regulation. I do not believe in any regard it cuts back excessively. I did disagree with the proposal to cut the review time for antitrust to 5 days. We have an amendment that will be coming soon from the gentlewoman from California that will push it back up to 15, not exactly where I would like it. We then will have a couple of other amendments to deal with. But I would note that we are going to correct what I think is one of the flaws in this bill. Mr. Chairman, I reserve the balance of my time.

Mr. FRANK of Massachusetts. Mr. Chairman, I yield back the balance of my time.

Mr. FRANK of Massachusetts. Mr. Chairman, I rise in opposition. Mr. Chairman, I yield myself 3 minutes. This is one of the two disagreements here. I should note that the section that is in the bill that the gentleman from Alabama seeks to strike was requested by the Federal Deposit Insurance Corporation. What they said was they want to be able to issue their orders. They do not have criminal procedures here. This does not take away one's right to a jury trial for any criminal trial. The FDIC has administrative powers. They can order one to cease and desist from a certain practice; they can debar one from working. What they are saying is they do not want to be unable to bar people or to order a stop to people who are being grossly negligent. The language that will be governing the FDIC's regulating authority with regard to lawyers and others who work on banking matters, these are people that are hired by banks as professionals; and let me say there was some argument before that, well, these people should not be held to knowing banking law. We are not talking about the guys who install the drywall. We are not talking about the people who do the valet parking at the big soirees. We are talking about lawyers and other professionals. And, yes, I do believe it is reasonable to hold lawyers to a standard of knowing bank law when they do lawyering for banks. And what the FDIC said is we do not want to have to prove that they were reckless or deliberate. If they are grossly negligent, we want to be able to step in. It is not a criminal proceeding. It is the FDIC. The FDIC wants to be able to hold professionals who are offering their professional services voluntarily to banks and working on bank matters to a knowledge of banking law to the extent if they are negligent, or even grossly negligent, if this amendment said the standard was gross negligence, it would be less of a problem for me, but this says for the FDIC to be able to discipline an attorney or any other professional servicing a bank, it must be a standard of either knowledge or recklessness of the conduct, and I think that is a mistake. We know that there is not always a great difference between the people who work full-time for the bank and the people who are working as professionals for the bank. There are people who specialize, lawyers who specialize, in serving banks, other professionals who would specialize in serving banks. It seems to me entirely reasonable for them to be held to that standard. So I do agree that we want to be deregulatory here, and a few minutes ago some of us were saying it was a good thing we have the FDIC. They are the regulators of the ILCs. They are an important regulator. This is a case where the regulators have asked us to keep a standard for them which they use when they are dealing with the banks themselves, and they want to be able to apply it to the independent contractors. I think it would be a mistake to give the FDIC significantly less power to act in enforcement proceedings against lawyers and other professionals than they now have. Mr. Chairman, I reserve the balance of my time. Parliamentary Inquiry

Mr. FRANK of Massachusetts. Mr. Chairman, I have a parliamentary inquiry.

Mr. FRANK of Massachusetts. Mr. Chairman, do I have the right to close on this amendment?

Mr. FRANK of Massachusetts. Mr. Chairman, I yield back the balance of my time.

Mr. FRANK of Massachusetts. Mr. Chairman, this is a very proconsumer effort. I do think people ought to be penalized when they can control it. But as the gentleman from New York as pointed out, bank practices today blame the victim. If one is a recipient of a bad check and they in good faith deposit it in their bank, they are penalized. Indeed, I would contrast this with the previous amendment. If one is an attorney now under this bill and they behave with gross negligence, the FDIC cannot do anything about it; but if they are the consumer who gets a bad check, they get whacked. I do not think it is anticapitalist to say that people who are the victims of bad checks once should not be victimized by bad checks twice. People have said, well, we should give them an incentive. As the gentleman from New York had said, I do not know many people who say I do not mind getting a bad check as long as my bank does not hurt me. I think there is already every incentive they have got to say no to it. We are not talking about someone who takes eight bad checks from the same person. The first time someone victimizes someone with a check that has insufficient funds, they are victimized. This amendment is a good amendment.

Mr. FRANK of Massachusetts. Mr. Chairman, in the apparent absence of anyone in opposition, I would ask for the time.

Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, this is, as I think has been made clear, a bill that has already passed the House. Clearly the former reasons for the prohibition on interest on business checking accounts no longer make sense in light of the current economy. I appreciate the gentlewoman from New York (Mrs. Kelly) alluding to the issue of the ILCs. When we had originally dealt with this, it had been my hope as this bill went forward in the other body, the compromise we had adopted could be considered there. For a variety of reasons this did not go forward in the other body. And the rules prohibit me from commenting on whether or not anyone ought to be surprised by the absence of that progress, so I shall not. But this, once again, we hope will go forward; because it is, I think, an important thing especially, as has been clear, for the small businesses. Interest on their checking accounts, if you are a smaller business and you have to maintain a large percentage of your funds in checking accounts for a variety of reasons, then the lack of interest could become a significant factor. So I hope that this will ultimately pass, but I do hope that the ILC issue will get some further attention. Mr. Chairman, I yield back the balance of my time.

Mr. FRANK of Massachusetts. Mr. Chairman, I ask unanimous consent to reclaim my time, and I also yield 1 minute to the gentleman from Pennsylvania (Mr. Toomey).

Mr. FRANK of Massachusetts. Mr. Chairman, I yield such time as he may consume to the gentleman from New York (Mr. Meeks), a very hard working member of this committee.

Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I want to express my appreciation to the chairman of the committee and the chairman of the subcommittee, because this is another example of where we have been able to work in a cooperative way. We do not agree on everything, but our method of operation allows us to refine our disagreements and to present to the House some legitimate policy disagreements, but in a form and in a context that does not interfere with our ability to go forward where there is consensus. There will be two amendments that we will be debating. The gentleman from Alabama will offer one, which I plan to oppose, that would reject a request from the FDIC to make it easier for them to proceed against people in the banking area that they think have been negligent. The gentleman from New York (Mr. Weiner) will be offering an amendment that I think protects consumers. I feel strongly in favor of that one. Other than that, I believe we have agreement at the committee level. I want to emphasize, and I must say I am very hopeful that the Weiner amendment will be adopted, but we will have to see what happens. I just want to reiterate my view that this reflects what I think ought to be our approach; namely, we start with respect for the market and an understanding that the free market is the best way to make our economy prosper. Particularly in the financial area that our committee has jurisdiction over, the role of the institutions as intermediaries in garnering the financial resources that are then made available to the people who do the production of goods and services, that is very important; and it is our obligation to make sure that that can be done with the maximum efficiency. At the same time we recognize, many of us, that the market is not perfect. It does well what it is supposed to do, but there are areas of importance in our life that the market does not deal with. There are also inevitable tendencies in any institution, government, the private sector, the nonprofit sector, to do things that if there were constraints, it should not do. That does not mean that they are evil or that they are dysfunctional; it just means that human nature being what it is, no entity ought to be able to function without some restraints. So our job is to provide for consumer protection in particular, which the market itself would not automatically do. Let me check that. In some areas I think we can rely on the market in the consumer area. There is a major merger, or a major sale in New England going on now where Fleet Boston is being bought by Bank of America. I have worked very closely with a number of entities that are advocates for low- and moderate-income people in the area of housing and in the area of small business and community development, because I do not think the market itself will take care of those. In other areas, in customer service, I think you can rely more on the market. There are competing institutions that will try to steal customers away. That is a good thing because, in the area of customer service, there will be competition. In areas where we are talking about lower-income people, competition does not do it, and we have to try to intervene. What we need to do is to recognize the importance of regulation but, at the same time, make sure that we do not regulate unnecessarily, because there are regulatory costs. I do not object to regulatory costs if they are essential to achieving an important public purpose. Where they can be shown not to have that relationship, they ought to be removed. We ought to also try to pick among various regulatory approaches until we get the one that gives us the most benefit for the least cost. This bill is, on the whole, an effort to do that. The chairman mentioned that in the controversial area of industrial loan corporations, we heard the forceful statements of the gentleman from Iowa who thinks that we should be more restrictive. We have Members who represent particularly States where the ILCs have played a major role, California and Utah in particular, who are represented in our committee, who think we have been too restrictive. The gentleman from Iowa (Mr. Gillmor) took the lead, and I was glad to work with him, in using a formula we had previously adopted in the Congress; namely, that to be a financial institution you should be 85 percent financial in your revenues, and we have used that as a screen for the additional entities that might be entering the ILC field. I think that is a reasonable compromise. I think that will protect the public interests, while continuing to allow consumer choice, and I congratulate the chairman and others for creating the context in which we could work that out. I know we will be proceeding to debate on a couple of controversial issues and, as I said, I think this is a good overall bill, but Members may be waiting to see what happens on some of the amendments to make their final judgment. Mr. Chairman, I reserve the balance of my time.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, I do not find myself critical of the intelligence community. The criticism I and many others have is of the political leadership which I think misused the intelligence and made faulty decisions. The gentleman talked about people who work in dark places. I did not talk about the Vice President. I do not know how he got into this debate. The point about what we are saying is this. We now, without weapons of mass destruction, without a tie to al Qaeda, have been told that the rationale for this was essentially to extend democracy. I am in favor of extending democracy; although extending it by military invasion is a difficult policy. There are plenty of undemocratic, tyrannical governments in the world, and I want to oppose them, but I am not generally for invading them. But what troubles me is that in the name of advancing democracy internationally, the majority is debasing it at home. No one can think, who understands the tenets of democracy, that this procedure today comes close to it. There is no justification whatsoever for this legislation to have been drawn up and then brought to us without amendment. Will someone explain to me why this could not be amendmentable? Were we too busy? That would not pass the laugh test. The reason is that the majority is afraid that if amendments were available, it would bring into discussion things they do not want to talk about. Of course, we support the troops. Voting for or against this resolution is wholly uncorrelated to supporting the troops. A resolution that simply congratulated the troops would have been passed unanimously. What we have here, frankly, is an effort to use the troops for political purposes. It is an effort to say that because Americans are proud of our fighting people, we will put into a resolution some phrase for them which contains a number of other politically more controversial items; we will bring it forward in a way that does not allow the democratic process to go forward. I hope the Iraqis will not be watching this and think that this is the way a democracy should work, that it should be up or down, that the Constitution should not be amendable, resolutions should not be amendable. We do not advance democracy by debasing it as we do in this procedure.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, last week I released a statement expressing my disappointment with the use by Venezuela's National Electoral Council (CNE) of hyper-technical points and controversial procedural rulings to repress what appears to be the clear will of a sufficient number of Venezuelan citizens to move the country to a constitutional referendum on President Chavez. The Organization of American States and the Carter Center observed first hand the democratic spirit shown by Venezuelans during the signature collection process, and they have publicly stated that they saw no significant problems with the collection of signatures. Both organizations have also said they disagree with the Chavez- dominated electoral board's decision to set aside 876,000 signatures unless citizens come forward to validate them because the large numbers involved here, and the short time period allowed in which to appeal these signatures, could frustrate the will of the Venezuelan people to have a referendum on their president. Because the decision of the CNE seems to me likely to obstruct the constitutional referendum process, I am submitting into the Congressional Record a recent editorial from The Washington Post entitled ``Coup by Technicality'' which provides specific details on the decision. I think it is also important that President Chavez understand that if the will of the Venezuelan people is disregarded, the international community will appropriately blame him, as the country's leader, for contributing, through his rhetoric and actions, to such a profoundly anti-democratic outcome. [From the Washington Post, March 5, 2004] Coup by Technicality LATE LAST YEAR 3,448,747 of Venezuela's 24 million citizens turned out in just four days to sign petitions calling for a recall referendum on President Hugo Chavez. This extraordinary civic exercise, monitored by observers from the Organization of American States and the Carter Center, offered a democratic solution to years of political conflict in that important oil-producing nation--trouble that threatened to push Venezuela into dictatorship or civil war. Now Mr. Chavez, whose crackpot populism and authoritarian methods provoked the crisis, blatantly seeks to stop the vote, in violation of his commitment to both the OAS and his own constitution. His actions have already prompted a new wave of unrest across the country, including demonstrations in which at least seven people have been killed. Unless he can be restrained, Mr. Chavez may complete his destruction of one of Latin America's most enduring democracies. Though the constitution, drawn up under Mr. Chavez's own administration, requires 20 percent of all voters to back a referendum, opposition groups collected 1 million signatures more than should have been needed for the recall vote. These signatures were rigorously audited by a nonpartisan civic group before being forwarded to the electoral commission. Yet, after delaying its response for weeks, the commission, dominated by Mr. Chavez's supporters, rejected 1.6 million of them, or nearly half the total. To do so, it invented requirements that didn't previously exist. Most notably, it threw out 876,000 signatures, each accompanied by a thumbprint, because someone other than the voter had entered registration details on the petition. Mr. Chavez's functionaries subsequently announced that they would give about a million of those stricken from the list a chance to restore their names--but only if they appear in a limited number of registration centers during one two-day period. In practice, that poses a next-to-impossible logistical challenge to the opposition, even if there were no harassment from Mr. Chavez's police and civilian goon squads. But attempts by the foreign mediators to reverse this Kafkaesque coup have so far been unsuccessful. Mr. Chavez, who has built a strong alliance with Cuba's Fidel Castro and imported thousands of Cuban personnel, appears eager for a domestic and international confrontation. Last weekend he called President Bush an ``illegitimate'' president, referred to him with a vulgar epithet and threatened to cut off oil supplies to the United States. Opposition leaders say that more than 300 people have been arrested in recent days, and that some have been tortured. Given the Bush administration's weak position in the region, hope for a peaceful or democratic solution rests mostly with Venezuela's Latin American neighbors, starting with Brazil. If Mr. Chavez continues to deny his people a democratic vote, leaders from those nations must be prepared to invoke the Democracy Charter of the OAS and threaten him with the isolation reserved for autocrats.

Mr. FRANK

Mr. FRANK. Mr. Speaker, I was unhappy--although not surprised--to see the President's most recent assault on programs that provide housing for people in great need. The administration's 2005 budget proposal calling for deep cuts in the section 8 program will have many harmful effects if it is enacted, and among those who will be most damaged by it are people with disabilities. Recently, the Consortium for Citizens with Disabilities Housing Task Force documented the great social harm that will result if we adopt the President's approach. This coalition, as Members can see by looking at the list of signatories of the document I am here inserting into the Record, broadly represents the major organizations in this country representing the needs of people with disabilities. To quote from this Consortium's conclusion, The CCD Housing Task Force strongly believes that the Administration's Flexible Voucher Program proposal would significantly erode housing assistance for the poorest people with disabilities. We believe this proposal actually undermines stated Administration disability policy goals designed to promote community integration under the New Freedom Initiative an end chronic homelessness. Mr. Speaker, the deeply flawed proposal the President has made to restrict section 8 housing vouchers will be one of the most important issues we will be debating in this Congress. No group has more to tell us about it than the Consortium for Citizens with Disabilities and I ask that the very important position paper of the Consortium's Housing Task Force be printed here so that Members will have the benefit of it during this debate. Position Paper On the Administration's FY 2005 HUD Budget Proposal, Section 8 Housing Choice Voucher Program Administration Proposal Would Cut Housing Lifeline for People with Disabilities The Bush Administration's FY 2005 HUD Budget proposal calls for deep cuts in the Section 8 Housing Choice Voucher Program. The budget also would radically alter the fundamental design of the program by converting it to a block grant administered by Public Housing Agencies (PHAs) for the benefit of higher income households. The Consortium for Citizens with Disabilities Housing Task Force (CCD Housing Task Force) is strongly opposed to the Administrations budget proposal which would cut more than $1 billion from current funding levels. We are also strongly opposed to the Administration's ill-conceived proposal to convert the program to the Flexible Voucher Program--a block-grant type approach which would eliminate many of the critical protections people with disabilities have under the current Section 8 program. The CCD Housing Task Force is a coalition of national disability organizations working to promote access to affordable and accessible housing opportunities and community supports for people with disabilities. People with disabilities have the highest level unmet need for housing assistance of any group eligible for federally subsidized housing. In 2002, approximately 3.7 million non-elderly people with disabilities relied solely on federal Supplemental Security Income (SSI) benefits worth $545 per month. Priced Out in 2002 (published by the CCD Housing Task Force and the Technical Assistance Collaborative) found that SSI recipients on average would need to pay 105 percent of their monthly SSI income to rent a modest one bedroom unit. The individuals whom we represent, many of whom depend solely on SSI or other disability benefits, are current participants in the Section 8 Housing Choice Voucher program or on Section 8 waiting lists. The Section 8 voucher program is central to their ability to have an opportunity to find affordable and accessible housing in the community. Administration Proposal Would Seriously Harm People with Disabilities The CCD Housing Task Force strongly believes that the Administration's Flexible Voucher Program proposal would significantly erode housing assistance for the poorest people with disabilities. We believe this proposal actually undermines stated Administration disability policy goals designed to promote community integration under the New Freedom Initiative and end chronic homelessness. The Administration's proposal would cause serious harm to people with disabilities in the following ways: Proposed reductions in funding of over $1 billion for FY 2005 would mean that at least 250,000 households, including at least 50,000 households with disabilities, would lose their Section 8 assistance within the next year; The Administration's Flexible Voucher Program proposal would eliminate targeting to the lowest income households. The federal targeting is a current Section 8 program requirement that has helped people with disabilities to live in the community. The new program could be used for households up to 80 percent of median income and dedicated exclusively to homeownership--closing the doors on many people with disabilities. Under the Administration's Flexible Voucher Program, people with disabilities could be required to pay much higher rents than they can afford. Current rules limiting tenant rents to 30-40 percent of income would be eliminated. PHAs would be given incentives to assist higher income households, a policy that would result in fewer people with disabilities receiving vouchers. PHAs could establish time limits on voucher holders. When a person's disability is permanent, their housing assistance should not be time limited. A time limited voucher could force people with disabilities back into nursing homes, institutions and other restrictive settings, and homeless shelters. Congress would no longer have the authority--as it has for the past seven years--to target Section 8 vouchers for people with disabilities who have lost housing due to elderly-only policies. Over 50,000 people with currently funded disability vouchers would be at-risk. Over the long term, the Administration's budget projections for 2005-2009 clearly show further erosion in voucher funding--putting more people with disabilities at-risk of losing their Section 8 assistance. By 2009, Section 8 expenditures would be more than $4.6 billion below what the Congressional Budget Office estimates would be needed to maintain the program's current level of funding. The Center for Budget and Policy Priorities (CBPP) projects that cuts of this magnitude would mean that 600,000 vouchers--or 30 percent of the vouchers currently authorized--would be eliminated. people with disabilities need section 8 vouchers People with disabilities have the highest level of unmet need for housing assistance of any group eligible for federally subsidized housing. The CCD Housing Task Force estimates that more than 3 million people with disabilities receiving SSI do not currently receive any housing assistance from HUD. The current Section 8 program is literally a ``lifeline'' for people with disabilities who rely on SSI, as well as other low income people with disabilities who simply cannot afford the cost of rental housing. Section 8 Vouchers are needed by people with disabilities who have been negatively affected by the loss of housing opportunities because of federal ``elderly only'' housing policies. Over 500,000 units of HUD public and assisted housing have ``elderly only'' policies, and more units are being designated ``elderly only'' every day. the administration's flawed rationale The Administration's proposal and their statements defending it are seriously flawed. The CCD Housing Task Force urges Members of Congress to treat this proposal with the same degree of skepticism and concern as it treated last year's Housing Assistance for Needy Families (HANF) proposal. One senior HUD official's public statement, that the current program's income-targeting requirements should be eliminated because they are not needed, can be rebutted by the fact that over 3 million people with disabilities below 30 percent of median income still do not receive federal housing assistance . HUD officials state that converting the current voucher program to a block grant is needed to control the programs ``upward spiral in costs over the past two years''. This statement is also misleading. HUD's failure to produce accurate data and projections on Section 8 program costs cannot be used to imply that Section 8 program spending is ``out of control''. The rising costs in the Section 8 program during the past few years are due in part to improved PHA voucher utilization--as urged by the Congress--and leasing of new vouchers authorized from 1999-2002. Other cost factors include the escalating rental market of the late 1990s (which has now stabilized) and higher subsidy levels needed by households who have recently lost employment. CBPP's analysis projects that spending for the voucher program for FY 2005 will grow by only 1.6 percent, which is lower than the rate of inflation. conclusion The current Section 8 Housing Choice Voucher program is the most important federal housing resource to address the housing needs of those with low incomes. We believe that Congress should maintain its responsibility to protect people with disabilities who receive or need Section 8 assistance. The CCD Housing Task Force urges Congress to fully fund the Section 8 voucher program in FY 2005, which means a $600 million increase over FY 2004 appropriation levels. We also urge Congress to reject the Administration's Flexible Voucher Program proposal. This proposal is nothing more than another attempt by the Administration to achieve what they could not achieve in Congress last year, when bipartisan opposition to the HANF block grant proposal ensured its failure. We believe that Congress should continue to have the direct authority to ensure adequate funding for the program and to make decisions on how the Section 8 program is utilized. HUD's role in administering the Section 8 program and monitoring the use of vouchers by PHAs is critically important. HUD should be held responsible for devoting the necessary resources to carry out these responsibilities successfully. Many of the current problems with the Section 8 program can be attributed to HUD's mismanagement--including long-standing mismanagement of over 50,000 vouchers targeted to people with disabilities. Most importantly, the Section 8 program should continue to be targeted to addressing the most critical housing needs in our country today--those of extremely low-income people including people with disabilities. CCD Housing Task Force American Association of People with Disabilities American Association on Mental Retardation American Network of Community Options and Resources Association of University Centers on Disabilities Bazelon Center for Mental Health Law Brain Injury Association of America Easter Seals Epilepsy Foundation International Association of Psychosocial Rehabilitation Services National Alliance for the Mentally Ill National Alliance to End Homelessness National Association of Protection and Advocacy Systems National Mental Health Association Paralyzed Veterans of America Spina Bifida Association of America The Arc of the United States United Cerebral Palsy United Spinal Association (formerly Eastern Paralyzed Veterans Association)

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, two weeks ago I was privileged to be able to speak to the Jewish Council for Public Affairs, at a national convention held in Boston, representing organized Jewish communities across the country. The various Jewish communal organizations are active on a variety of fronts, including efforts to alleviate poverty and social distress. The participants in the organizations that make up the JCPA are themselves individuals who give freely to charity, and understand in part because of this that while private charity is extremely important, it is no substitute for well-funded government programs that meet social needs. Drawing on their experiences in this regard across the country, the attendees at the Plenum of the Jewish Council for Public Affairs adopted a resolution, which called on the Congress ``to reject efforts to make permanent the 2003 tax cuts.'' As the resolution notes, ``to feed the hungry, clothe the poor, heal the sick, and educate our children, our Federal Government requires the resources that come from tax revenue.'' This does not mean that the council opposes all of the tax cuts previously enacted, but this strong statement against the proposal to make permanent all of the 2003 tax cuts deserves very serious attention, given the moral credentials of those who enacted it. Mr. Speaker, because this is one of the most important questions that will be facing us in this Congress, I ask that the very compelling resolution against making all of the 2003 tax cuts permanent be printed here. JCPA Resolut1on in Opposition To Making Permanent the 2003 Federal Tax Cuts As Jews and Americans, we are committed to aiding members of our community in need through the work of our synagogues, CRCs and other private organizations, while relying on our Federal Government to ensure that it has the fiscal means to meet the needs of all its citizens. To feed the hungry, clothe the poor, heal the sick, and educate our children, our Federal Government requires the resources that come from tax revenue. The Bush Administration's proposed Fiscal Year 2005 budget seeks to make permanent the Federal tax cuts passed in 2003. To do so would increase deficits by $2 trillion between 2005- 2014, inhibiting Federal investment in both existing and new programs. These tax cuts will affect the lives and well-being of our children, and our children's children, who will struggle in a society weakened by the fiscal decisions our government is now making. The JCPA calls on the Administration and Congress to enact legislation that will allow the Federal Government to meet its responsibilities to its citizens and to reject efforts to make permanent the 2003 tax cuts.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Madam Speaker, I am here to talk about a very serious economic and, therefore, social problem facing the country. We talk about the unemployment statistics, we talk about the ebb and flow in the job market, and the particulars are important. But by now we have enough evidence over the past several years so that we should be focusing not on month-by-month figures, but on what appears to be a very significant change in the nature of our economy. Indeed, I think we may be at a major inflection point. I hope I am too pessimistic. I hope tomorrow there are going to be figures that show much greater growth in employment than we have seen. But even a good one month is not going to undo the problem we are facing. Here is the problem: we have had a recovery from a recession over the past couple of years. In 2003 in particular, in the third quarter we had very significant growth, aided by a series of government programs and the natural cyclical rebound from a period of slowdown, and we had growth in the fourth quarter. What we have not seen is the growth in employment that ordinarily accompanies this degree of economic recovery. In short, it appears from a variety of indicia that we are at a point where the ability of the private sector in this country to create wealth is now outstripping its ability to create jobs. The normal rule of thumb by which a certain increase in the gross domestic product would produce a concomitant increase in jobs, it does not appear to apply. By the way, among those who were misled by the assumption that the normal rules would apply are the leading economic officials of the Bush administration. For example, in October of last year, Secretary of Treasury Snow said, ``I am confident that this economic recovery will now be sustained and will produce loads of new jobs. Everything we know about economics indicates that the sort of economic growth expected for next year, 3.8 to 4 percent, will translate into 2 million new jobs from the third quarter of this year to the third quarter of next year. That is an average of 200,000 new jobs a month.'' Well, we have had 4 months of experience since the Secretary told us we would get 200,000 new jobs a month. We have gotten less than 40 percent of that. In a period in which his reading of the rule of thumb said there would be 800,000 new jobs, we have gotten 300,000. Similarly, interestingly, we then got from the Council of Economic Advisors and the President's economic report a projection that we would get in this calendar year 2.6 million new jobs, more than 200,000 a month. Shortly after that projection was made, it was repudiated by, guess who? The very same Secretary of the Treasury who had predicted the 200,000 a year. He and the Secretary of Commerce were sent out to do that. Then the President distanced himself from it. We use that word in Washington a lot, you ``distance'' yourself from it. That means you deny it. Then the chairman of the Council of Economic Advisors, Mr. Mankiw, himself repudiated his own estimate. Here is what is significant. People make mistakes, but his explanation was interesting. On February 17 at the National Economists Club, asked about the job forecast of 2.6 million jobs, which had by then been abandoned by everybody, including himself, his response was, ``That particular forecast was made in early December, and we have seen more data since then.'' Now, he went on to say he still hoped for more jobs, but his explanation of why the 2.6 was now inoperative is very simple: that forecast was made in early December; we have seen more data since then. In other words, last fall both the Secretary of the Treasury and the Chairman of the Council of Economic Advisors were going under the old rule that said a certain amount of increase in the GDP, you will get a certain number of jobs. And that turns out, sadly, to have been wrong. We are in a situation in which the ability of the private sector to create wealth is now leaving behind its ability to create jobs. By the way, we got further confirmation of that from Alan Greenspan. On February 11, testifying before the House Committee on Financial Services, he was asked what we could expect with regard to unemployment. Our colleague, the gentlewoman from New York (Mrs. Maloney), asked him, what about unemployment going down? His answer in effect was only if productivity drops. To quote specifically, asked if the 2.6 million jobs, which, of course, had already been abandoned by the administration, was credible, he said, ``It is a credible forecast, if the rate of productivity slows down to a more historical average.'' He later said he did not expect productivity to slow down. In other words, he joins the Secretary of Treasury and the Chairman of the Council of Economic Advisors in telling us we are not going to get the job growth they had earlier predicted, hoped, wished for, et cetera. But understand the explanation: we will only get a significant drop in unemployment, we will only get the historic drop that we can expect in unemployment, if productivity goes down. What an unfortunate situation. After all, an increase in productivity is good news. In the economic sphere, it is one of the goals of civilization, to be able to produce more with less; more leisure, less effort. Increased productivity ought to be a good thing. But people who are now unemployed listening to Mr. Greenspan are forced to root against productivity. He tells them that if productivity continues to rise at a higher than historically average rate, that the chances of their getting jobs goes down. That is where we are today. For a variety of reasons, we have a situation in which increased wealth has been somewhat disconnected from increased jobs; not entirely, but the connection has been loosened. Another way to put that is this: a disproportionately large share of the increased wealth in this society is now going to the owners of capital. Our usual rules of shared increases in wealth have broken down, and people who work for others are getting a smaller share compared to those who own capital. By the way, we see this not just in unemployment. Partly because of the increase in unemployment and what that does to the labor market, et cetera, we have a situation in which not only has unemployment stayed higher than historically we had hoped, but wage growth has been below the norm. The Economic Policy Institute has a very interesting chart which shows the real growth in wages and salaries in the past six recessions, 2 years after the recession ended. Here are the increases in real growth in wages and salaries: 10 percent; 12 percent; 9 percent; 11 percent; 3.6 percent; and, in the current period, in the period since this recession was officially declared over by the National Bureau of Economic Research, 0.4 percent. In other words, virtually no growth in real wages. Last year, in fact, in another calculation that is presented by the Economic Policy Institute, although it is not controversial, these are basic figures, last year, the year in which we had some real growth, 6 months of last year, after all, were great in terms of overall growth, real wages dropped, median earnings went up 2 percent; but inflation went up 2.3 percent. In other words, during that period of great growth, not only did our unemployment stay higher than it should have been; real wages did not go up. In fact they went marginally down for people employed. In fact, over the last 2 years, the total increase in median wages here is 3.8 percent. Inflation is 3.9 percent and wage growth is 3.8 percent. So over a 2-year period, 2002 and 2003, there was marginal erosion in real wages. It is not simply that unemployment has stayed up and real wages have lagged. Health insurance is another area where we have serious problems. In the period from 2000 to 2002, the number of people who were receiving health insurance from private employers dropped by 2.8 million. The number of people with health insurance went up, but it went up because the government sector, Medicare and Medicaid, made up for the erosion in the private sector. The private sector's profits have gone way up. They are very high. Compensation at the upper levels, the top 1 percent, they are very good. But unemployment, employer-covered health benefits, real wages, are all lagging badly. And while I do not have the statistics on this right in front of me, what we know about health insurance is not only are more people losing privately paid for health insurance; many of those who keep it, keep it by paying a larger percentage of it. Health costs go up, and to the working person it is a double whammy, because they pay, in many cases, a higher percentage of a higher overall cost. This is the problem then. We are at a situation in which as growth goes forward, and that is a good thing that growth is going forward. It was to be expected and hoped for. We were in a recession. We also have had conscious government policy promoting growth. We have the largest budget deficit, and as we know now, the Republican administration has implicitly become cagey in this regard and they argue that this kind of stimulus that comes from a very large deficit is a good idea, although they continue deficits long after we hope we will need stimulus. You have the lowest real interest rates in memory by the feds. So everything the Federal Government can do in monetary and fiscal policy to stimulate the economy has been done. Not surprising that given that we start in the recession and you have maximum fiscal and monetary stimulus you get some growth. It is disappointing we have not gotten more. It is a little bit like buying a new car, jumping on the accelerator, and getting it up to 50. It is good for your staying in the speed limit, but it does not say a lot for the engine. But the discouraging thing is that with maximum stimulus, fiscal and monetary, from the Federal Government, we are seeing no growth in real wages over 2 years, a slight erosion last year, people losing health care on the whole from private employers and paying more for what they get, and unemployment staying too high. What do we do about it? First of all, we have to analyze the causes. Some of the causes are inherent in the nature of the economy. Productivity does have the effect of allowing us to do more with less, particularly when you are coming out of a recession and people are reluctant to hire. There are also international trends which no matter what we try to do will be somewhat erosive of the position of some workers in this country. But this situation in which almost all of the benefits of growth are going to the owners of capital would not exist without conscious public policies that promote it. Public policy in my view, and I will get to specifics, ought to be leaning against the increased inequality that the private sector is creating. Madam Speaker, let me give you my philosophy. I am a capitalist. I believe the free enterprize system is the best way to create wealth. That means I welcome some inequality in the system. If you do not have inequality, if people are not unequally rewarded for their skills, for their energy, for their correct guesses or intuitions about what the public will want, then the system does not work. But I also believe that left entirely to its own, as I thought we had decided as a country with Franklin Roosevelt, more inequality will be generated than is either socially healthy or economically necessary. I know there are some conservatives that say, well, that is just the politics of envy. Inequality is unimportant. The only thing that counts is the absolute level. Let me quote what they feel may be an unlikely source in the defense of my argument. It is Mr. Greenspan on the same day he testified February 11. He volunteered that he agreed that, well, let me read it exactly. I had spoken earlier about my concern about increased inequality and he volunteered, ``I happen to agree with Congressman Frank that it is very important in this country not only to have an equitable society but to have it perceived as being inequitable because no democratic system can function unless the people believe it is inequitable. And I think that it is crucially important for us to reduce the income inequality in this country.'' Now, he goes on to say that he thinks a major way to do that is through community colleges. I am a strong supporter of community colleges, which do a wonderful job. I think Chairman Greenspan imposes on them too much of the burden. But regardless of our disagreement about how you deal with inequality, I welcome his statement. Let me quote it again. ``It is crucially important for us to reduce the income inequality in this country.'' The problem is public policy has gone the other way. It has exacerbated it. How has it done that? First by changes in the Tax Code. When President Clinton asked this Congress in 1993 to increase taxes it was predominantly, overwhelmingly on people making incomes of $100,000 and above and that was 10 years ago. Mostly on people making more than $150,000. For the first time, according to the Congressional Budget Office, that tax bill made the tax system somewhat more progressive. It meant that wealthier people paid more than they have been paying and lower income people less in terms of shares given their income. President Bush has succeeded in persuading this Congress on several occasions to reduce taxes predominantly, overwhelmingly on wealthy people. The administration has said the goal is to reduce virtually all taxes on capital. Ownership will pay no taxes. Ownership will get the benefits of the increased wealth but pay none of the taxes. So the Tax Code is one of the reasons we have increased inequality. Another is the systematic attack that has been made on labor unions. Labor unions have played a very important part in this country in helping middle income, moderate income working people gain some share of income. There has been a consistent assault on them from this Congress and from the President. Madam Speaker, I would not have thought that so many years, 70 years almost, after the passage of the Fair Labor Standards Act in the New Deal that overtime for people who work by the hour would be a controversial situation. But this administration, with the acquiescence of the Congressional leadership, is allowing overtime to be cut back. So we weaken what instruments are out there to help working people. We change the Tax Code in ways that promote inequality. We pursue an international economic policy which maximizes the extent to which globalization undermines income shares in this country. I was pleased to be at Davos, Switzerland, at the economic conference. One of the moderators of a panel I was at on inequality, because the people who run that conference agree with Chairman Greenspan and myself that inequality is in and of itself a bad thing. It needs to be addressed. The moderator made a good point. He said, there are two kinds of inequality we have to address. There is inequality between countries and then there is inequality within countries. The defense that we have heard of international trade, much of which I agree with, has focused exclusively on diminishing inequality between countries. That is a good thing. I want to help poor people elsewhere. But this administration has in a determined way pursued that international economic policy and justified it as helping to deal with poverty elsewhere. But they have done it in ways that have exacerbated inequality within countries, within our own country and within others. International trade that basically says, you know what, labor regulations and occupational safety and health regulations and environmental regulations, they are an interference with the function of capital. Therefore, let us tell other countries that we will put no pressure on them to deal with any of those things, and then let us use the absence of those things as a lever to reduce them in our own country. Understand, it is not as the conservatives here believe that there is no comparative impact of differential environmental policies. Indeed, when President Bush explains why he is against doing anything about global warming, certainly against the Kyoto Treaty, explicitly he and members of the administration say we cannot join that treaty with global warming because China and India are exempt from it and that will make a competitive disadvantage for our people. Of course, his Chairman of Economic Advisers will tell him that you go over that by outsourcing to China and India. That is a good thing. And he should not have to worry. But the President does not go quite that far. Some of us say, you are right. The fact that they have no environmental rules and we have some does exacerbate our competitive disadvantage. Let us try to get them to do some environmental things. No one I know of says that the wage level, the minimum wages or the working conditions ought to be the same in the poorest countries of the world as in the U.S. No one is arguing that. That is a straw man. What we are saying is they should not go standardless. There should be the core labor principles of the International Labor Organization: The right to bargain collectively, the right to form unions, the right to begin to organize as American workers did. Had there never been unions and Franklin Roosevelt had not gotten passed the National Labor Relations Act, we would not have had the kind of middle class that we had in America of which we now boast. They did not do it all by themselves. They were an integral part of it. At any rate, what this administration wants to do is follow an international economic policy that is further erosive of the ability of working people in this country to maintain some gains because they subject them to maximum competition from others who do not have that. Obviously, there are different wage levels. There are jobs that will go overseas purely economically. That should not be enhanced by an undeserved advantage because there are no unions, because there is child labor, because there are no environmental rules, because there is no concern for occupational safety. That is, yes, comparative advantage in economic terms has a lot to be said for it, but adding to that differential public policies, not only is it in itself bad but it becomes the premise then to come back home and try and dismantle it. American workers are told two things by this administration. One, we are not going to try to encourage other countries to require them if they want access to our markets. The American markets are the greatest thing in the history of the world. People want our capital. They want access to our markets. We have a right to condition that on reasonable legislation and regulation that meets minimum standards of civility. Instead, what we are told is you come here and we will not require of you anything that is protective of those basic human rights. And then American workers will be told by their workers, you know, I am competing with people who do not have unions. I am competing with people who do not have to put up with this occupational stuff so I have got to cut you back. And let us throw in here the very serious problem of health care. I note on the floor my colleague from the State of Washington (Mr. McDermott), who has been one of the leaders in this Congress in trying to get a sensible health care system in, one of the things that has contributed to the difficulties that American workers face is our system of tying your health care to your place of employment. That has serious negative consequences. And today as the forces I have been talking about have eroded the ability of working people to defend themselves, we are seeing this in the health care area. Remember, fewer people today, in the millions, have employer- generated health care and many of those who do have health care that costs them more. Fewer people, and they are paying more for it. So those are some of the ways in which public policy makes the situation worse. As I said, I accept the fact of inequality. I just do not accept that it is a good thing. It makes the system work. But the role of government ought to be to contain inequality, not promote it, and that is what we have. Let me talk about why I think inequality is a bad thing. It is nice to be able to cite Chairman Greenspan, but to be honest I do not agree with him on cutting Social Security or a few other things so I should not just rely on that citation. I think it is a moral issue, a situation in which people receive millions, tens of millions of dollars in bonuses, a situation in which profits go higher and higher and the market is now doing well and we are all glad to see that, a situation in which the owners of capital find their wealth enhanced, but working people lose their health care, people are unemployed, children do not have adequate housing and other necessities. That is morally unacceptable to me. But I understand, Madam Speaker, particularly in this particular Congress, the moral argument will only take you so far. When I argue that we should deal with inequality because it is immoral I am reminded of what Adlai Stevenson once said when someone said to him, Governor, you have got the votes of all the thinking people. And he said, well, yes, but the problem is that I need a majority. Of course it was his penchant for making remarks like that that helped him in getting a majority. But I think there is a strong moral argument here, but I need a majority so I will not rely only on that. There are two other reasons for helping us reduce inequality, helping us reverse it. Let me just repeat this because I think we have not fully focused on that. We talk about unemployment in a kind of isolation. We talk about other things in isolation. There is an overall picture here. The overall picture is that the private sector is creating wealth and exacerbating inequality at the same time. It is creating wealth without creating an adequate number of jobs. It is eroding health care. It is preventing real wages from going up so that profits are going up much more rapidly than real wages. Essentially, we have a combination of economic factors and technological factors and public policies, which mean that a disproportionately large share, nearly all of the increased wealth we are producing, goes to the owners of capital and virtually none to the people who do not own a huge amount of capital and get their compensation from the work they do every day. Now, as I said, I think that is morally flawed. That is why I am in politics, to try and reduce inequality without reducing it to the point where it interferes with inefficiency. And we are, of course, nowhere remotely near that. But let me give two other self-interested reasons. First is a political one. I read recently that the Republican leadership has decided that they probably better not put the Central American Free Trade Treaty up. I have disagreed with the trade treaties that have come forward for reasons that I have said. I think globalization is a necessary thing. It is a fact of life, and it can be a good thing if it is done well. It is important for us to try to reduce poverty elsewhere: good morally, good politically, good practically. I never liked the particular trade treaties. So I am talking now to the people who do. There are people out there who think that getting more trade treaties through is, in fact, important for the economy. There are people who believe that continuing to allow businesses to rationalize their workforces, rationalize means cut, that that is a good thing. What do you see today? You see great opposition to the trade treaties. They are afraid to bring any up here, for good reasons. They would probably lose. They have Republicans saying to them, please, I have enough problems that you have created for me; I do not need to vote for trade treaties when there is this terrible problem about unemployment. You are going to see legislation adopted, you do not have to be a genius to predict this, which says if you are going to get government money in this contract, you cannot outsource, because outsourcing has bothered people. Ten or 15 years ago, I was representing an area that had a large textile and trade employment base, and we were told, well, stop worrying about that, these people should understand. That is not a good job for an American. We will retrain them. Well, first of all, the extent to which you were going to retrain some 49- or 53-year-old with a high school education was limited in terms of its appeal to them; but even to the extent that you were retraining, let us note that the jobs that I was being told 15 years ago, for which we would retrain people, we would not only now have to retrain them, we would have to buy them airplane tickets because they are going out of the country. The jobs being outsourced today are the jobs for which we had been told we should retrain people. I do not think the answer is just to stop this. I do not think you can say, all right, we do not want any more of this going on in the economy. I understand the importance of economic transition, although I believe that we are failing in our responsibility to manage that transition. What I will point out now is this: precisely because of the public policies that have exacerbated inequality, what you have done, those of you who have promulgated those policies in the administration and the congressional leadership, in the business community, in the intellectual circles that reinforce them, you are increasingly persuading the American people that they have no skin in this game of economics, that they will not benefit from this increased wealth. So when you say to them, do this, it is in your long-term interest, they turn against you. So precisely out of self-interest, those who believe that increased trade and the ability to outsource and flexibility in the labor market, if you believe those things, understand that the policies that you have supported in the short-term and the consequences of that have built up a resistance you cannot overcome. Those people who believe in increasing the ability of capital to find its own level are going to find they are going to have the worst year they have had this year than they have had in a very long time because they have convinced most Americans that it is not in their interests. I talk about this with Mr. Greenspan when he testifies. He will cite in his speeches and elsewhere a very eminent deceased economist, Joseph Schumpeter. In his great book, ``Capitalism, Socialism and Democracy,'' he talked about creative destruction. He said, you know, he did not say you know. He was an illustrian, much more formal than me. Than I. He would not say than me either. Joseph Schumpeter said, when you destroy old economic entities because they are outdated, new ones will be created out of the resources freed up. That is what he means by creative destruction, Mr. Greenspan. As old economic activity is outdated, that frees up people and resources for new economic activity; and Mr. Greenspan is prone to say to people, I understand you are losing your job and that is a problem, but in the long run this will be good because out of this will come this new stuff. Well, as I have told Mr. Greenspan, there is another economist whom people believe much more instinctively, John Maynard Keynes, because if you listen closely to the Bush administration and some of the conservatives here, a lot of Keynes-ism has sneaked in as they tried to justify the world's largest deficits by short-term budget terms. Keynes also said something very smart politically: in the long run we shall all be dead. People understand that. Telling some 45-year-old worker with a couple of children that he or she should not despair at losing the job that he or she has had for 20 years because out of the loss of his or her job new jobs will be created at some point in the future, which he or she probably will not get, does not help them. They are resistant. So people should understand, one of the prices they are paying for enhancing inequality, encouraging it, is that you have persuaded most Americans, an increasing number of Americans, it may yet be most, but it is certainly a lot, they are immune to your argument that this is good for the economy and the country. I do not think that is healthy. I do not agree with necessarily every one of those specific policies, but I do not think we ought to have this angry public resistance to overall growth; but you have built it up, and we need to tell you how you can undo it. Now, there is another reason why this is not good economically. One of the private sector economists, Stephen Roach, who has done a good job of documenting the fact that we are at an inflection point, that we are in a situation in which we simply are not getting the job growth we thought historically we would get, well, let me just quote him: In my view, the income leakages of imported productivity, that is, when you send the jobs overseas, et cetera, that is imported productivity, the income leakages of imported productivity raise serious questions about the sustainability of this recovery from an economic point of view. What you are saying is this, the economy is sustained to some extent by its own momentum. One of the things that helps you grow is the income that is generated by that growth. There is a beneficial cycle that we call it. You are not getting that now because as the profits grow and wealth grows, but real incomes of most of the people do not grow, there is a missing element in the economy. Short term, we are not hurting; but there is a very real prospect that this increased inequality will stunt our economic growth. In other words, the situation in which growth is great but all of the benefits of growth go to a handful is not long-term sustainable. So, once again, even those who do not mind the increased inequality do not understand they are building in a difficult situation. Wage and salary disbursements, Mr. Roach points out, are basically unchanged in real terms fully 21 months into this recovery. By contrast, at this juncture in the past six upturns, real-wage income has been up on average by about 9 percent. Absent other sources of support, this shortfall of internally driven income generation could end up spelling serious trouble for the overly indebted, saving-short American consumer. Let me read that a little more sensibly, for the overly indebted, saving-short American consumer. In short, there is a good reason to doubt the sustainability of a recovery built on a foundation of imported productivity. In other words, when you create wealth and some of it goes, most of it, to the owners of capital and some of it goes to people outside our economy, you are not doing the kind of self-sustaining recycling of economic activity that you need. So that is where we are. We are at a situation, as I said, which seems to me an inflection point. The normal rules by which a certain amount of economic activity in the country will produce a certain amount of jobs, that has been eroded; and as we have seen high profits, we have seen a fall-off in real wages. We have seen a fall-off in the private sector provision of health insurance which is supposedly the major way we do it. We have seen unemployment staying above where it should be. We have seen profits do very well. We have seen the market go up. We have seen upper income compensation stay up. We have seen the Tax Code change in ways that unfortunately reinforced that. Well, it is fair to say at this point, okay, what do you do about it, because conclusions are not always easy. Some things we can do. When it comes to inequality in the society, there is, of course, the story about a man who goes to the doctor and says, Doctor, when I hold my arm this way it hurts, and the doctor looks and looks and cannot find anything wrong, and he says, okay, I know what to do. He says what? Do not hold your arm that way. I mean, to a certain extent, you can remedy something by simply not continuing to do it. We can stop changing the Tax Code in ways that exacerbate inequality. We can stop encouraging owners of capital to find ways, with tax help in some cases, to export jobs and import productivity. We can stop weakening labor unions, stop eroding the ability of working men and women to stand up for themselves; but we can go beyond that. First, with regard to international trade, and I do not want to stop it, not anybody does, but we have a group here, one of the leaders intellectually is the gentleman from Michigan (Mr. Levin), who is the senior Democrat on the Subcommittee on Trade, and a lot of us have worked with him, we do not want to block trade, but we want to deal both with income inequality between countries and income inequality within countries. We do not want the one to be exacerbating the other. We do not expect other countries to have the same wages and environmental and occupational health policies we do, but we do not think they should have none either. We think they ought to be encouraged to level up some, and it will not stop trade; but it will diminish the depths of the comparative disadvantage and make it a more legitimate one. We can, as I said, even change the Tax Code to make it even more progressive. I think it is entirely legitimate for this government to say, by the way, where the government, where the people, through their taxes, are paying for jobs, we do not want you outsourcing them. Even if it costs us a little bit more, we believe that the value to this society of not having that source of income in jobs lost is worth it. So I think restrictions in outsourcing will help. But there is one other thing I want to address in particular here. It is one that I think I and many Democrats have not been sufficiently explicit about. One of the important sources of relief here is government. I know it is very fashionable to bash government. From the platform just behind me, President Clinton, with whom I was usually in agreement, made a big thing of saying the era of Big Government is over. Well, in worldwide comparative terms, the era of Big Government never really got started here, and our problem today is too little government. Of course, we want government to be sensible. We do not want excessive regulation. I have supported many of the deregulations, but there is a role for government today that we are ignoring. I mentioned as an example health care, and I pointed out that health insurance coming from private employers has dropped. The only reason that health insurance in the country as a whole has not dropped is we have taken up that slack through government, through Medicaid, through Medicare. People tell us, well, government medicine is terrible. In my experience, the most popular form of medicine in America is that which is delivered through the Veterans Affairs Department; and anybody who tells World War II veterans, average age of 80 or so, that they are not going to get their VA medicine anymore better be ready for World War IIA because they are going to be very angry at you. In fact, we have relied on government to plug part of the gap that is increasingly left in the provision of health care by the private sector, and I am for those as stopgaps; but we would be much better off following the lead of my colleague who I have referred to earlier from Seattle, the gentleman from Washington (Mr. McDermott), and let us do this in a systematic way. We need more of a government role in health care, and breaking the nexus between your private job and health care makes sense from every perspective. It would remove a disadvantage from some American businesses, and I would say this to Mr. Greenspan and others who preach patience to those who are losing their jobs to these trends. It is one thing to lose your job, get unemployment for a while. We will get to that in a minute, maybe get another job. Increasingly, though, the jobs you lose had some health benefits and the jobs you get do not. One of the things that people who kind of blithely tell people do not worry about it, creative destruction, you will be okay in the long run, maybe not blithely, maybe that is unfair, but who tell people just buck up, they do not understand the terror and horrors of losing health care. As long as Americans who lose their jobs are told they are also losing their health care, they are resistant to what is euphemistically called labor flexibility and will understandably and legitimately be very tough. Let us begin by providing health care to every American whether or not he or she is employed and regardless of where he or she is employed, and you will reduce a lot of the resistance and a lot of the pain that comes from these transitions. I do not think we should try to stop economic transitions, and I do not think we can; but it is our responsibility as public sector people, as the private sector undergoes these transitions, to manage them better, to ease the pain of the victims of the transition, to use some of the wealth generated by this increased productivity, by this labor flexibility, by this rationization and globalization. Let us use some of the wealth not simply to go to the pockets of those who own but to deal with the social problems generated by that very transition. Government also has a major role here in the job area. People then say, okay, what are you going to do about the jobs? Here is the way I would conceptualize it. We are now, as I said, in a situation where the private sector produces more wealth than jobs. I believe we should take a percentage of that increased wealth, a fairly small percentage, certainly nothing that is going to interfere with incentive, and use it together, the people coming together to employ people on socially useful purposes. Yes, we got some boosts from tax cuts last year during the recession. I think we would have gotten a better boost economically and socially if we had given more to the cities and States and municipal governments. They added to the unemployment problem, not willfully. They hated to do. But for a variety of reasons, as we were trying to get the private sector to add jobs, we were involved in policies that cost jobs at the local level. Had we instead given tens of billions more to the local governments and State governments, we would have had better economic stimulus. You know, nobody will have a propensity to spend, in economic terms, as high as a city government that is stressed and needs to provide services. That is especially the case when we talk about homeland security. There are things in our society which are partly public and some that are largely private. Some are entirely private in terms of what we want done. Homeland security is pretty much a public sector activity. It does not make any sense to talk about how we are enhancing homeland security and then beat up government and boast about reducing government. Police officers, firefighters, ambulance drivers, public health workers, and public works people, who are going to have to repair damages, these are public sector people. The point is this: One of the ways we can deal with the inability of the private sector to produce the level of jobs we had hoped it would produce, and again I want to note John Snow and Gregory Mankiw, leaders of this administration's economic policy, in effect both admitted that last year they predicted many, many more jobs than are being created in the private sector because they thought the old rules applied, and it is now clear the old rules do not apply. So, what do we do? Well, one of the things we can do is to recognize that the public sector can in fact take up some of that slack, that some of the wealth we create through our increased productivity, et cetera, can usefully be sent to cities and States, and to others as well. We are now underfunding the Environmental Protection Administration. We have Superfund sites, the worst environmentally blighted sites in this country, that are going to go untended because there is not enough money in the Federal Government to take care of them. The Bush administration finds itself being criticized by veterans through an inadequacy of the government. Secretary Principi, a man of great courage, acknowledged he got $1.8 billion less in the budget this year than he thought he needed. I do not believe the President dislikes veterans. I do not believe this administration set out to say, I have a good idea, in an election year let us really aggravate the veterans. They are driven to it because, thanks to their policies, there is not enough money to meet our basic needs. If we were to take some part of the private sector wealth that is now going almost exclusively to the owners of capital and put it in the hands of government, Federal, State, and local, we would have more police officers, we would have more Environmental Protection Administration cleanups, we would have better public transportation and trains, we would have more medical care, we could deal with the terrible housing crisis that we have. And I know to the Republican leadership this might sound like a revolutionary bill, but we might even pass a highway bill. That seems to be beyond their means. Why? Because there is not enough money. I just wrote an article for one of my papers, and I said I know you hear a lot of discussions in the abstract about the size of government, but let me make it concrete for you, and I mean literally concrete. I am not a big fan of metaphors. Under the proposed public works bill that the chairman of the Committee on Transportation and Infrastructure wanted, I would have gotten so much money for a major highway project important both to the public safety and the public convenience and the economic development of a major city in my district, the City of Taunton. Under the Bush plan we would get one-third less. Now, this is highway money that is, I am told by the business community, important to the economic future of the area. This is a clear point here. We now have the acknowledgment of the Chairman of the Council on Economic Advisers and the Secretary of the Treasury and the President that the private sector cannot produce enough by way of jobs to meet our needs. Wages are eroding in part because as there is higher unemployment, the pressure on wages is higher. Medical care gets cut back to the extent that we rely on the private sector. We will remain a private sector economy. We should welcome productivity. We are in a situation, just to sum up, in which the good becomes the bad. Greenspan tells us we are not going to get a reduction in unemployment unless you see a slowdown in productivity. What a topsy-turvy world in which people have to root for less productivity. That is the result of bad public policy. This is not a force of nature. It is not the case that good productivity ought to mean bad social policy. It is because we have a bad set of public arrangements. One way to change that is to take some of the wealth which is being created by this wonderful thing, this increased productivity, this new technology and the ways of using it, and all this innovation, and let us use it for our own undisputed public purposes. Let us give cities and States more money so they can have more people policing, fighting fires, cleaning up the environment, repairing facilities that need to be repaired, enhancing train transportation, building highways, helping construct affordable housing in places where that is a crisis, helping pay for higher education for students. Chairman Greenspan said it is education, but we have a situation now where if you are not wealthy then you cannot pay for the kind of public education that maybe you ought to be getting. You have to sacrifice too much for it. Let us use some of this wealth. And, again, the choice is this: We are talking about more wealth going to the wealthiest. And I know there are two aspects of the administration's justification for its tax bill, a supply side and a demand side. The demand side says we are in a recession, we need to spend our way out of it to some extent or we need to create a deficit so the Federal Government is spending more than it is taking in. Good Keynesian economics. Good for Keynes in the 1930s, good for Bush in the year 2003. That is what we did. But that was only a small part of the tax relief. A very small percentage of the tax relief came in the form of that demand stimulus. The great bulk of the tax relief, some of which is yet to come, some of which has begun to happen, is a supply side tax cut. Supply side tax cuts do not try to increase money in people's hands to spend. They say if we will tax rich people less, they will do us the favor of working more. And that is what we have got. If we tell people when they die and they have $8 billion the people who inherited from them will not have to pay a penny of taxes on it, then they will accumulate more. That is their argument. I do not think there is much to the supply side argument at all. It is certainly unproven. And certainly it is the case that trying to justify a very large chunk of supply side justified taxes by the success of a smaller amount of demand side taxes has a total disconnect there. I think if we were to take some of the revenue that is now set aside to persuade the rich, the very rich to work harder to the benefit of all of us, though we have not yet seen that benefit, if we were instead to make that available for undisputed, noncontroversial public purposes, public safety, environmental cleanup, highway construction, public health, if we were to do that, it is a situation of multiple benefit. The public purposes are accomplished and there are people employed. We are talking now to some extent about the New Deal philosophy. But we are not talking about leaf raking. We are talking about very real needs. And, of course, it was not just leaf raking in the New Deal. A lot of very important things were built by the Works Progress Administration and even the Public Works Administration. But we are talking now about unmet needs in this society. In virtually every area where we come together: In education, where we underfund the No Child Left Behind Act; in the environment, where we are leaving Superfund sites untended; in veterans affairs, where the veterans legitimately complain about cutbacks; in highways, where the chairman of the committee is told, no, you cannot have the money you think we need for this; in housing, which comes within the jurisdiction of my committee, where not only are we not building any new affordable housing, we face a crisis where nearly a million units over the next 10 or 12 years will be lost to us if we do not reverse policies. Using some of the money that now goes overwhelmingly to the owners of capital, only some of it, leaving them still very well off, and making that available to the government, to the public, is economically and socially better. So there is a case now for taking some of that wealth and for more government. Sensible government? Yes. There are indisputable cases where this country believes, understands that we need more public spending. We now have an ability. And that takes me finally, Mr. Speaker, obviously, to the question of the tax cuts. This is the issue before us. Do you, as the President wants, make permanent all those tax cuts, which exacerbate inequality, which enhance the situation where the owners of capital get almost all the wealth, and which does not appear to be generating the kinds of jobs and other benefits we had hoped for; or do you take a part of it and make it available to the public sector so that undeniable public needs can be met and people can be better employed? I would just say in closing to my conservative friends, who are currently and I hope temporarily in control, you have the ability to say no to all these things. You can keep wealth-enhancing tax cuts in place, you can continue to cut back on overtime, you can continue to undermine labor unions, you can continue to pursue a trade policy that gives leverage on people to bring down rather than up any kind of protections, and you may win these battles in the short run. But you are every day increasing public resistance to what you think is necessary for overall economic policies. So if equity is not enough, self-interest ought to persuade those at the top of the private sector, and those who represent them politically, that the time has come to recognize that we have a changed economy and to adopt public policies and reverse the trends of making inequality worse and instead diminishing so that we get both more jobs and a healthier society and a more sustainable economic recovery. Madam Speaker, I submit for the Record documents supporting and relating to my special order speech. The Evidence on Job Creation, Wages, and Health Insurance Non-farm payroll employment increased by 88,000 in October 2003, by 83,000 in November 2003, by 16,000 in December 2003, and by 112,000 in February 2004. (Source: Bureau of Labor Statistics.) Real wages has grown by 0.4% since the end of the recession in November 2001. In the five previous recessions, real wages grew by 10.7%, 12.4%, 9.2%, 11.3%, and 3.6%, by the same point in the recovery (25 months). (Source: Economic Policy Institute based on Bureau of Economic Analysis data.) Growth in median wages in 2002 was 1.8%, compared to inflation of 1.6%. In 2003, median wage growth was 2.0%, compared to inflation of 2.3%, resulting in a decline in real median wages of 0.3%. (Source: Economic Policy Institute based on Bureau of Labor Statistics data.) Between 2000 and 2002, employer-provided health insurance declined by 2.8 million people. (Source: Urban Institute based on Current Population Survey.) During the past five years, health insurance premiums have increased annually by 5.3%, 8.2%, 10.9%, 12.9%, and 13.9%. (Source: Urban Institute based on KFF/HRET Survey of Employer-sponsored Health Benefits.)

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. If I could ask the gentleman from Texas, I like to keep up with new trends in the House. I was struck when the gentleman from Texas, the majority leader, said he could not speak for the Rules Committee. Is that a new development we had not previously known about?

Mr. FRANK of Massachusetts. Mr. Speaker, will the gentleman yield?

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, one aspect of my work in Congress of which I am most proud is the aid I am able to give to credit unions, which perform such an important economic and social function. One of the people who has helped me understand the role of credit unions is Daniel Egan, who plays a leadership role not just in Massachusetts, but through cooperative arrangements with our neighboring States of New Hampshire and Rhode Island. Recently, the Neighborhood Reinvestment Corporation, a very important national organization fighting for economic fairness, passed a resolution congratulating Dan Egan in his capacity as president of the New Hampshire Credit Union League--which he holds in addition to his Massachusetts work--for his efforts to promote credit union activity. Mr. Egan very much deserves this recognition and as a tribute both to him and to the important work of the credit unions of New England, I ask that the resolution from the Neighborhood Reinvestment Corporation be printed here. Resolution Commending New Hampshire Credit Unions and the New Hampshire Credit Union League for Their Statewide Partnership with NeighborWorks Organizations Whereas, the Neighborhood Reinvestment Corporation and its affiliated NeighborWorks organizations are devoted to providing non-profit financial counseling and affordable housing in more than 2,300 communities throughout the United States; Whereas, New Hampshire Credit Union League President Daniel Egan and the National Credit Union Administration co-hosted a workshop to encourage credit unions to partner with NeighborWorks organizations; Whereas, as a result of that workshop, leaders of New Hampshire's 32 credit unions pledged a total of $35 million to establish a fund, in conjunction with the Neighborhood Housing Services of Manchester, a NeighborWorks organization, to provide affordable housing, counseling and loan programs; Whereas, the Home Ownership Loans program provides a NeighborWorks course on life skills, financial management, and property management for first-time homebuyers who do not qualify for conventional mortgages; Whereas, the Family Emergency Loans program helps families in need make critical payments such as home heating bills, and provides NeighborWorks counseling for these families to set aside funds that will protect them from future emergencies; Whereas, the New Hampshire credit unions' partnerships with NeighborWorks organizations serve as a model for other institutions to partner with NeighborWorks organizations throughout the United States: Now, Therefore, Be It Resolved, The Board of Directors of the Neighborhood Reinvestment Corporation officially commends the credit unions of New Hampshire and the New Hampshire Credit Union League for establishing this fund in partnership with the NeighborWorks network in New Hampshire and helping to make homeownership affordable so that more people can realize the American dream and lay a foundation to build wealth that they can pass on to future generations.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, I think it was highly inappropriate for Justice Scalia to go on a hunting trip with Vice President Cheney when he was a defendant in a case, but it is inaccurate to say that this calls into question Justice Scalia's impartiality. You cannot call into question that which does not exist. Questioning Justice Scalia's impartiality is like questioning Janet Jackson and Justin Timberlake's sense of propriety, or Saddam Hussein's weapons of mass destruction, or the President's plan to cut the budget deficit in half in 5 years. In fact, if you read Justice Scalia's opinions, they are singularly devoid of impartiality. Here is a man of very vigorous views and prejudices, and he does not see any reason why he should not write them into various opinions. So, I guess in some ways this is a defense of Justice Scalia. I wish he had refrained from going on that hunting trip with the Vice President, but those who accuse him of having damaged his impartiality, he has a defense of that, well-known to lawyers, it is a defense of impossibility.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, during my service as a Member of Congress, I have from time to time worked with the Export- Import Bank on matters particularly important to significant employers within my district. In an ideal world, there would be no subsidies of any sort for exports. But in the real world which we inhabit, Americans seeking business elsewhere often confront heavy subsidies from other countries, and without an instrumentality like the Export-Import Bank, these American enterprises would be at an unfair disadvantage. The Export-Import Bank's existence enables many American companies to compete on even terms, with good results both for the companies that provide goods and services and those that benefit from them. For example, several years ago I was proud to work with the Export-Import Bank to make it possible for the Raytheon Corporation to receive a major contract in Brazil, which allowed Raytheon to use its technical skills for environmental purposes. Without Export-Import Bank aid, the Raytheon effort would have been unsuccessful, not through any fault of their own, but because of heavy subsidies from the national governments of competitors. Most recently, I was glad to join several of my Massachusetts and New Hampshire colleagues in urging the Export-Import Bank to show support in a meaningful way for the Malden Mills Company, whose owner, Aaron Feuerstein, has justly drawn widespread praise for his combination of economic wisdom and social responsibility. I was pleased that the Export-Import Bank did respond in ways that were very important in this situation, and I am pleased that we have this entity in place to provide this kind of essential assistance to American companies who would otherwise be facing unfairness.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, trying to decide what is the greatest hypocrisy in politics is a hard job, but I believe that by sheer dollar volume the support of many who call themselves free market conservatives for the leading aspects of America's agricultural policy qualifies for the prize. Few areas in public policy in this country are as heavily subsidized by the taxpayers, rigged against consumers, blatantly unfair to poor people in other parts of the world, and contemptuous of the whole notion of competition and free enterprise as American agriculture policy in various of its aspects. I am frequently puzzled to hear many who declaim their staunch allegiance to free trade, low taxes, no government intervention in the economy, the free market, and unmitigated competition make an implicit exception when the subject is corn, cotton, wheat, peanuts, sugar, or other commodities. Apparently, there are people who believe that the works of Ludwig von Mises and Friedrich Hayek contain an invisible footnote that says that none of this applies to agriculture. In the February 12 Washington Post, just before we went on our mid- winter break, George Will documented the blatant inconsistency with regard to the sugar program of the U.S., noting correctly that it has once again contributed to the demise of jobs in the United States by people who had been manufacturing candy. I disagree with much of Mr. Will's conservative approach to economic matters, so I do not agree therefore with everything he says in this column. But I salute his intellectual honesty in urging that the conservative economic principles he professes be applied across the board, without the exception for agriculture made by so many others who claim to be his conservative confreres. [From the Washington Post, Feb. 12, 2004] Sweet and Sour Subsidies (By George Will) Saturday, Valentine's Day, sweets will be showered on sweethearts--a bonanza for candymakers. But the very next day all 242 Fannie May and Fanny Farmer chocolate candy stores will be closed. They and many jobs--625 of them at the firm's 75-year-old Chicago manufacturing plant--are, in part, casualties of that outdated facility, bad business decisions, and high U.S. labor and other costs. But jobs in America's candy industry also are jeopardized by protectionism, which is always advertised as job protection. In this case, the protectionism is an agriculture subsidy--sugar import quotas. Chicago is no longer Carl Sandburg's wheat stacker and hog butcher, but it remains America's candy capital, home of Tootsie Rolls and many other treats. In 1970, employment by the city's candy manufacturers was 15,000. Today it is under 8,000, and falling. Alpine Confections Inc. of Utah has bought Fannie May and Fanny Farmer and may continue some products. This is partly because the price of sugar is less important in soft chocolates than in hard candies. But the end of 2003 brought the end of Brach's production of hard candy on the city's West Side. A decade ago, Brach's employed about 2,300 people. Until recently, many of the remaining Teamster jobs paid $19 an hour. Many signs in the abandoned Chicago facility were in Spanish, Polish and Greek for the immigrant workforce, most of whose jobs have gone to Mexico. Labor is cheaper there, but so is 92 percent of the raw material for hard candy--sugar. By moving outside the United States, Brach's can pay the world market price of sugar, which is one-half to one-third of the U.S. price as propped up by import quotas. Life Savers, which for 90 years were made in America, are now made in Canada, where labor costs are comparable but the yearly cost of sugar is $10 million less. Chicago's Ferrara Pan Candy Co., maker of Jawbreakers, Red Hots and Boston Baked Beans, has moved much of its production to Mexico and Canada. Dueling economic studies, few of them disinterested, purport to demonstrate that more American jobs are saved or-- much more plausibly--lost because protectionist quotas raise the price of sugar for 280 million Americans. In the life of this republic, in which rent-seeking--bending public power for private advantage--is pandemic, sugar quotas are symptomatic. It was to a North Dakota radio station that Robert Zoelick, the U.S. trade representative, vowed that he would stand like Horatius at the bridge to block Australian sugar. The quotas can be considered among the bearable transaction costs of democracy, keeping North Dakota's, Minnesota's and other states' growers of sugar beets as well as Florida's, Louisiana's and other states' growers of sugar cane from starving. Or seceding. Or, heaven forfend, being forced to grow something else. But protectionism is unconservative, unseemly and unhealthy--indeed, lethal. Unconservative? Protectionism is a variant of what conservatives disparage as ``industrial policy'' when nonconservatives do it. It is government supplanting the market as the picker of economic winners. Another name for industrial policy is lemon socialism--survival of the unfit. Unseemly? America has no better friend than Australia. Yet such is the power of American sugar interests that the Bush administration has forced Australia to acquiesce in continuing quotas on its sugar exports to America. That was a price for achieving the not-exactly ``free trade'' agreement signed last weekend. But look on the bright side: Restrictions on beef imports will be phased out over 18 years. Is protectionism lethal? Promoted by Democrats hawking their compassion, protectionism could somewhat flatten the trajectory of America's rising prosperity. But protectionism could kill millions in developing nations by slowing world growth, thereby impeding those nations from achieving prosperity sufficient to pay for potable water, inoculations, etc. Developed nations spend $1 billion a day on agriculture subsidies that prevent poor nations' farmers from competing in the world market. Sugar quotas, although a bipartisan addiction, are worst when defended by Republicans who actually know better and who lose their ability to make a principled argument against the Democrats' protectionist temptation. Fortunately, splendid trouble may be on the horizon. Last September's collapse of the World Trade Organization's ministerial meeting in Cancun, Mexico, meant that the pernicious ``peace clause'' was not renewed. For nine years it has prevented the WTO from treating agricultural subsidies as what they obviously are--market distortions incompatible with free trade. For Americans, a fight over that is worth having, and losing.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, I thank my colleague and friend from New Hampshire for his graciousness in yielding to me, and I yield myself such time as I may consume. I am glad to be along with him and many of our colleagues from New England cosponsoring this resolution congratulating the New England Patriots on their second Super Bowl title in 3 years. I have said this before, Mr. Speaker. In the profession which we have chosen and are lucky enough to have had some success in, we sometimes find ourselves being blamed for things that are not our fault. But those occasions are offset by those times when we can bathe in entirely unearned glory. The New England Patriots, as they now are, are an excellent team that did a superb job, well coached; they dealt with injuries, they held together, compiled a superb record. And those who represent New England in Congress get to stand up here and bathe in their glory. I am grateful to them for winning the championship and for the fact that we can do that. I do not think politicians ought to insinuate ourselves into professional sports. It has been my experience that at professional sports events, the needed ones are the fans. So we are not trying to do that. What we are doing jointly is to pay our respects to a group of very dedicated, hardworking young men. Let us be clear. To do what any professional football team does, particularly to do what the Patriots do, requires a degree of discipline and dedication and willingness to do hard physical work in very adverse weather conditions. They are very well coached. The ownership of the team deserves credit. I will make just one political point. I am very proud to note that the stadium in which they won so many of their games and from which they went out to win the Super Bowl championship, in the town of Foxborough, Massachusetts that I represent, was not built with public money. This is an indication that there is no need to go to the taxpayers to get money to build public stadiums. There is an ability to do that when a team is well-run and well-managed and well-owned by private capital. So I really want just again to say how proud the people, not just of the town of Foxborough or my district or northern Massachusetts are, but all over New England, as my colleague from New Hampshire makes clear, because as the team is the New England Patriots, we had to import somebody from New Hampshire, because Massachusetts is incapable at this point just technically of bipartisanship on our own. But I really appreciate the gentleman from New Hampshire's cooperation, and congratulations to the New England Patriots for doing an important thing so well. Mr. Speaker, I yield back the balance of my time.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Chairman, I move to strike the last word. Mr. Chairman, this is one of the most important issues we are going to deal with. The question is whether or not organizations receiving taxpayer dollars paid for by every taxpayer in this country for secular purposes, nonreligious purposes, will be allowed to use those taxpayer dollars to discriminate against people based on their religion. There are arguments about what the history is or is not and the current status is or is not. They are on both sides of the case. Let us deal with the merits. Why should people in this country who pay their taxes be told that they are not eligible because of their religion for a job which is paid for by their taxes? Of course, religions have a right to hire their own co-religionists in religious matters, but let us understand. If you are talking about the propagation of religion, a very important function, under the Constitution's establishment clause that cannot be done with public money. By definition you can only use public money for secular purposes. No one denies that. The question then is, if you get the money for secular purposes, why should you be able to tell people that they cannot work for you if you do not like their religion? It is not just religion in the more formal sense. It is religion as the recipient defines it. If you believe that no one who believes in evolution can be a true Christian, then you will, under the law, without the Woolsey amendment, be allowed to deny people who believe in evolution the right to work in a soup kitchen. If there were a nexus in the job, yes. If you were asking people to teach creationism, then you could ban people who believe in evolution, but a janitor, an architect, a contractor? The notion, by the way, that we have to do this to allow faith-based groups to work is unfair to faith-based groups. I do not think they need to be discriminatory. We are not again talking about telling them they cannot hire people for religious purposes. What is it about people of another religion that is so distasteful that it is somehow wrong to ask people to associate with them? Are we saying that people cannot administer good works, that they have to associate with Jews if they are Christians, with Catholics if they are Baptist, with Muslims if they are Episcopalians? Of course, it is the case that in America what Martin Luther King said years ago is still true, the hour of worship is a pretty segregated one. Tell Orthodox Jews in Brooklyn that they may hire only their own and how many African Americans will be hired? Tell Mormons in Utah that they may only hire their own and how many Americans are hired? Tell the African Methodist Episcopal church or tell the Nation of Islam that they may hire only their own co- religionists, and how many white people or Hispanics get hired? We need not empower discrimination. In fact, I have worked myself, as many others have, with the archdiocese of Boston, which has a wonderful housing program with combined Jewish philanthropy's housing program. The notion that religious charities cannot do their work unless they are allowed to discriminate against people not of their religion as they define it is factually wrong. So that is the question here. I would have thought that the lesson of the last few years is that there is too much religious separatism, too much divisiveness, too much us against them in religion. Yes, let us encourage religious groups to be fully participant in good works, but let us not write into the law of the United States the principle that having simply to work with someone of another religion in entirely nonreligious matters, secular matters, is somehow so corrosive to your morale, so corrosive to your ability to function that you ought to be allowed to say to people, yes, pay taxes for this. We will take billions of dollars of tax money paid by everybody, and you Jews, you Christians, cannot apply. Let me say, I was recently shown something that I am told comes from the Focus on the Family Web site, and if this is an error I will apologize. I hope I will be corrected. I hope it is an error. What I am told it said was, if this amendment passes, Christian charities interested in accepting Federal funds will be required to ignore religious conviction in hiring, even if potential employees practice Islam, Judaism, or no religion at all. Yes, I think under the American Constitution and our principles, people who practice Islam, Judaism, or no religion at all ought not to be taxed and told that they are not eligible to do the work for which they are wholly qualified except that people do not like their particular religion. I hope the amendment passes.