Barney Frank

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Well, I don't understand why we would say that. There might be students who have the money to buy it. And this fiction that students who buy a home, parents who buy a home for their own child to live in are foreign investors seems to me to import a fiction to get around an excessively rigid bill. And there may be other categories of people who are lawfully in this country who don't have Social Security numbers and could have the money to buy a home, and I am unpersuaded that we should prohibit that.

Mr. FRANK of Massachusetts. Will the gentleman yield?

Mr. FRANK of Massachusetts. We might be able to work this out. I am really concerned about the students and others. I am prepared to say that I would be willing to see that this bill is in conference. The gentleman obviously can press ahead. I going to vote against it at this point because it does seem to me that there are categories of people who can lawfully be in the country who have money who could buy a house, and I don't think we want to stop it. There will be some enforcement issues that we could work out, but I would hope we could more clearly define it; that is, I do think it's important that we say that this be confined to people who are illegally here. But relying on the Social Security number as the exclusive validator of someone's legal presence in the U.S. seems to me not good policy.

Mr. FRANK of Massachusetts. Mr. Chairman, I move to strike the last word. The gentleman overstated what I said. I do agree as to B. I would say this, and B, I think is perfectly reasonable. I think it might be hard to administer, but I would certainly, I would want to agree to B. I have a problem with A for this reason. We got CBO to score this. CBO scored it based on a tax reduction, and then there's a repayment in the REFCORP bonds. There's a fairly complicated proposal that we accepted from CBO to keep it revenue neutral, and it includes a tax deduction at one end, but a payment back at the other end. If the gentleman would be willing to ask unanimous consent to strike A, I would be prepared to be in favor of B. We could go back into the whole House, we could get unanimous consent. The problem is that if we strike A, I'm afraid it could unravel or scoring from CBO which assumes that they could deduct it and they would get the deduction, but CBO then said the government will lose money because you deducted it and we make up for another way with payments for the REFCORP bonds. I don't always understand what CBO says, but I can say that it's revenue neutral, recognizing the tax deduction, but making a payment that offsets that. So if the gentleman would agree, I would certainly agree, because I think B is a reasonable effort to do this. I'm not sure how effective it will be, but I agree we should try. We are not sure about the pricing. I know procedurally we could do this, so if the gentleman would be agreeable, I would hope we could do that. If you would ask unanimous consent to modify the amendment by dropping A. If not, I will oppose this amendment, but I will move to, if I am successful in opposing it move to incorporate B when we get to conference. But I think a better way to do it would be to get unanimous consent to modify the amendment. I will yield to the gentleman.

Mr. FRANK of Massachusetts. No, I do not. I can tell the gentleman that what CBO, we asked them about the scoring, they said there would be a cost because it would be a tax deduction. But they then made up for that by requiring some of the funds to go to help pay off the REFCORP bonds which are left over from the S&L bailout. And I do know that's what was done. I yield to the gentleman.

Mr. FRANK of Massachusetts. I will just talk for a while, Mr. Chairman.

Mr. FRANK of Massachusetts. Yes, I was just going to kill time while you were looking so that, you know, we look like even though it's midnight, we're not all comatose. And as I said, alternatively, because it does cause us problems in the scoring and technical ways. It does seem to me the key is section B, and I would be agreeable to accepting section B now. Alternatively, I would hope that it would be defeated and we would put section B in conference. I'll yield to the gentleman.

Mr. FRANK of Massachusetts. Parliamentary inquiry, Mr. Chairman.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Madam Speaker, for 14 years, Dixon Osburn has been the Executive Director of the Service Members Legal Defense Network, an extremely effective and principled organization that has fought against the unfair discrimination against gay, lesbian and bisexual people in the U.S. armed services. It is hard to combine passion and common sense in a political cause--people who feel strongly often have an understandable difficulty in controlling their strong feelings to the point where they can follow the most rational strategies, and serving as the head of an organization exacerbates this, since the head of such a group is required to preach thoughtfulness to people who are--often justifiably--far too angry to want to think about things. Dixon Osburn as Executive Director of SLDN performed this extremely difficult task very, very well. No one ever doubted the depth of his commitment to the cause of fairness for LGBT service members, and no one could fault the analytical discipline he brought to the job. I believe that we will some day in the near future abolish this unfair ``don't ask, don't tell'' policy, which discriminates against individuals and deprives our military of personnel who would perform useful services at a time when we need that. When we do reach that goal, the important work that Dixon Osburn has done over these past 14 years will deserve a great deal of the credit.

Mr. FRANK of Massachusetts

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

Mr. FRANK of Massachusetts. Under the rules, is there any limit to the number of times a Member may ask the identical parliamentary inquiry?

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Madam Speaker, one of the most important institutions in the part of southeastern Massachusetts I have the privilege of representing, is the University of Massachusetts Dartmouth. The school has a justified reputation as a key agent for economic and educational development in the region, particularly along the State's south coast. One of the reasons for that reputation is Professor Brian Rothschild, who was until recently the Dean of UMass Dartmouth's School for Marine Science and Technology, SMAST, and currently serves as the school's Montgomery Charter Professor of Marine Science and Technology, as well as Co-Director of the Massachusetts Marine Fisheries Institute, and Chairman of New Bedford Mayor Scott Lang's Ocean and Fisheries Council. I was delighted to learn that the National Oceanic and Atmospheric Administration, NOAA, recently named Dr. Rothschild as one of the recipients of the agency's 2007 Sustainable Fisheries Leadership Awards. I can't think of anyone who is more deserving of this award, or who better exemplifies the effort to harness science in the furtherance of sustainable fisheries. I have found him to be not only an accurate, completely reliable source of information, but also someone who consistently offers creative solutions to fishery science and management problems. In other words, he not only possesses extraordinary scientific acumen--he also uses it in the service of larger, societal goals. For him, sustainability means a fishery that supports both healthy stocks and healthy fishing communities. Knowing of his commitment to this concept, I was not surprised he was chosen to head New Bedford's Ocean and Fisheries Council. This position has given him a broader platform from which to promote sustainability, and his advice and contributions continue to be valuable, whether they relate to the recently enacted Magnuson Reauthorization bill, environmental factors that affect fish stock abundance, how to more accurately determine fish populations in multi-species fisheries, or other vital research areas. Madam Speaker, in view of Professor Brian Rothschild's distinguished career in fishery science, and in recognition of his many contributions to that discipline in southeastern Massachusetts and all of New England, I applaud NOAA's decision to honor him with a Sustainable Fisheries Leadership A ward, and I ask that the recent New Bedford Standard-Times article noting this achievement be printed here. [From the New Bedford Standard-Times, April 21, 2007] UMD's Rothschild Wins NOAA Award (By Becky W. Evans) New Bedford.--Fishery scientist Brian Rothschild has won the National Oceanic and Atmospheric Administration's sustainable fisheries leadership award for his contributions to marine science and education. Dr. Rothschild, former dean of the UMass Dartmouth School for Marine Science and Technology, is one of seven recipients of the award, created in 2005 to recognize individuals, organizations and industries ``whose contributions to science and management have served to promote best stewardship practices for the sustained use of the nation's living marine resources,'' according to NOAA's Office of Constituent Services. ``I feel very appreciative of people who recommended me for this honor,'' Dr. Rothschild said. ``I have dedicated my whole career to service and it is nice to have some recognition.'' Dr. Rothschild is the Montgomery Charter Professor of Marine Science and Technology at SMAST. He also is chairman of New Bedford Mayor Scott W. Lang's Ocean and Fisheries Council and is co-director of the Massachusetts Marine Fisheries Institute. According to NOAA, Dr. Rothschild is ``one of the most cited fishery scientists in the world,'' having published more than 100 scientific papers and book chapters. His research interests include population dynamics, biological oceanography, fisheries management and natural resources policy. Before arriving at SMAST in 1995. Dr. Rothschild held professorships at the University of Washington and the Center for Environmental and Estuarine Studies at the University of Maryland. He spent a decade working for NOAA as a policy adviser and director of several offices. He has consulted on fishery issues for the United Nations' Food and Agriculture Organization in India and Namibia and with the governments of Great Britain, Korea, Egypt, Peru, France and the Republic of Ireland. The sustainable fisheries leadership awards will be presented during a ceremony in Washington, D.C., on June 7.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Let me take back my time. Two points. First of all, I do want to respond to this really terrible argument that this might drive companies to go private. Do Members realize, Mr. Chairman, how viciously that attacks the CEOs? That argument says this: A CEO faced with the possibility of people voting on his or her salary will take that company private. I think that is a terrible thing to say. Secondly, if the SEC makes a recommendation, we are here to listen to it.

Mr. FRANK of Massachusetts. Yes. And reclaiming my time, I will tell him what it is. If all this asks for was for the SEC to study it, I would support the amendment. And section B, ``The commission shall conduct a study,'' I would be glad to support that. Indeed, the commission could do that on its own. What I object to is a point has been made before and it is constitutional, Congress being made to wait for permission from the regulatory agency to do things. So, again, and I appreciate the gentleman, but I do want to go back to the error of the gentleman from Illinois when he said we had to hit the pause button. This does not take effect until 2009. We are not rushing into anything. And we delayed the effective date at the request of the Business Roundtable so there would be no burden in paperwork on the company. Between now and 2009, if the SEC wants to do a study, it can do a study. If you want to mandate that they do it, I would be glad to mandate that, although the SEC has been somewhat overworked. The difference is, and the reason I object is, this says that Congress will not go forward with what most of us on our side, and many on the other side, think is a good idea until the SEC gives us permission. I do not think constitutionally we should await permission from the regulatory agency. By the way, the gentleman from Illinois, I don't understand. He wants to find an inconsistency, and when he can't find one, somehow he manufactures one. I never said the SEC was all wise and all knowing. He is caricaturing things that weren't even said. What I did was to acknowledge that the SEC has moved here and the SEC, I do want to remind my colleagues, is in Washington. All this rhetoric about no mandates from Washington is wholly inconsistent with the affirmation of the SEC's having correctly proposed the information. I would also say to the gentleman from Georgia, I was not struck by the fact that he and the gentleman from Illinois differ. It has been clear to me for some time. I have been on the committee. The gentleman from Georgia and his Republican colleagues often differ, and I will say in the spirit of the French assembly ``vive la difference.'' I encourage people to differ with the gentleman from Georgia. I would hardly chide them for it. What I was responding to is the gentleman from Illinois accusing me of misstating the views of the gentleman from Georgia, and I am glad the gentleman from Georgia cleared that up. But back to the main point. We have until 2009. Yes, the SEC has the right to study this if it wants to. And if this was simply a mandate that the SEC study it, it would be a different story. But saying that the bill is contingent on the SEC's finding seems to me constitutionally unwise. That's why I would not support it as is, but I would support a modified version. Mr. Chairman, I will yield to the gentleman from Illinois.

Mr. FRANK of Massachusetts. I yield to the gentleman from Georgia.

Mr. FRANK of Massachusetts. Of course not. The gentleman asked for a courtesy. Had the gentleman offered this in committee, I would have been glad to have a dialogue with him. Had he seriously wanted this amendment and offered it during the floor, we could have talked about it. But to wait until the last minute when we can't read it, to refuse to take advantage of an open rule, to refuse to offer it in committee, and now ask me to yield to you? Of course not. Now, I want to emphasize again: this may or may not be good. I will guarantee the Members here will look at this. We have a way to go on this bill. It has to go to the Senate. If in fact we need further to tighten the language, and it was the gentleman from Connecticut, Mr. Shays' amendment that we adopted that sought to do this, if the gentleman from Florida is right and Mr. Shays' was inadequate, if the gentleman from Florida is right and Mr. Shays' amendment doesn't do the job, we will analyze it seriously. But I urge Members, do not on a serious legal issue, when we have had 2 minutes to look at a complex legal principle, vote to put it into a bill when the Members advocating it deliberately refused to subject it to an open democratic process. I hope this is repudiated.

Mr. FRANK of Massachusetts. Mr. Speaker, never has the willingness of the minority to abuse the process for purely political ends been truer than today. Mr. Speaker, this bill was voted on in committee in a multi-day markup. A number of amendments were offered and debated. One amendment offered by the gentleman from Connecticut (Mr. Shays) aimed directly at this point, and the language was accepted by us and is in the bill, and it says that nothing in here shall create a new fiduciary duty; and it was intended to achieve exactly what we are now told this has sought to achieve. If Members genuinely thought it was inadequate, they had the rest of the markup to try to amend it. And we are here under an open rule. If the Members thought that the bill that we had voted on and which they had every chance to amend needed further amendment, the democratic procedure, the procedure that shows respect for the process, would have been to file an amendment. Had this been an amendment, we could have debated it for more than 5 minutes. We could even have read it for more than 2. This was delivered to me about 2 minutes before we started. I am not one of the more modest Members of the body, I concede. But I do not credit myself with being on my own, off the top of my head, not having practiced law ever except for the fact that I am a member of the bar, I am not able to fully analyze this. It might be something very useful. And people who are genuinely interested in adding it to the bill could have offered it in committee; they could have offered it under the open rule; we could have debated it. We have had a large number of roll calls; we just had seven roll calls. Now, we have been told in the past, well, I had to do a recommit, you wouldn't give me any other chance. Members on the other side had every opportunity at the committee and in this open rule fully to debate this and to offer amendments. They chose not to. They chose instead to legislate by ambush. Mr. Speaker, I had underestimated the tenderness of the feelings of the Members opposite. I confess to insensitivity, but I will not confess to the disrespect for our legislative process that Members--

Mr. FRANK of Massachusetts. Will the gentleman yield?

Mr. FRANK of Massachusetts. Mr. Chairman, I move to strike the requisite number of words. Mr. Chairman, this is an amendment, the purpose of which is to let people vote against the bill without voting against the bill. What the amendment says is, we don't need the bill. There are some Members who are apparently reluctant to vote against the bill. There would be no reason to vote for this amendment in the normal course of events. What it says is that we don't need anything else. Again, the effect of this amendment is exactly, exactly the same as voting ``no'' on the bill. But some Members have a problem. There are a lot of examples of excessive compensation in the minds of many. I would note that this Congress will not be making any judgment about what is or isn't excessive. One amendment was offered by a Republican that would have had us differentiate based on some definition of ``excessive.'' I hope that is voted down. I don't think we should be that intrusive. What the amendment says is, we don't need a bill. Well, if you don't need the bill, you vote ``no.'' Why would you vote for an amendment that says you don't need a bill instead of simply voting ``no''? The answer is, you don't want to be accused of voting ``no'' on the bill, so you vote for an amendment which has the same effect as killing the bill but is worded slightly differently. I do note, and I acknowledge my colleagues on the other side agreeing, because someone said, oh, the government shouldn't get involved in this. What this does is celebrate a significant government involvement in the pay practices of corporations. What it says is that the rules issued by the Securities and Exchange Commission, dominated by Republicans, run by a former Republican Member of this House as the chairman, that those rules are adequate and complete. In other words, it says, ``Those are a good thing. That's all we need.'' Understand that those rules were a ``mandate,'' to use the word that has been used here, a significant mandate by the Federal Government into private corporations. It says to private corporations, we, the Securities and Exchange Commission, this was done last year, we order you against your will, because if you want to do it, you could have done it voluntarily, we order you as the Federal Government to print on every proxy form the following information in the following form. I am glad they did that. I am glad that my colleagues implicitly repudiate this notion that somehow the Federal Government is not supposed to tell corporations what to do. The SEC did do that. But now the question is, what do you do with the information? It is interesting. I was just shown by one of the members of the staff an article where the corporation, United Health, was asked to allow a vote, then, by the shareholders on this information which the SEC has put forward, and they said, well, that would put us at a competitive disadvantage in America because some companies would do it and some wouldn't. This bill simply eliminates the competitive disadvantage. It says every corporation can do it. I was asked before, why don't you leave this to the market. That's what this bill does. The market consists of the people who own the shares, who buy the shares. This bill empowers them. Finally, I do want to note that my colleagues are giving a different set of arguments, my colleagues on the other side, today apparently, than Wednesday. On Wednesday, there was a lot of patriotism and a lot of talk about, let's not do what other countries do, let's stick with America. There were a lot of references to America's success in the corporate world. The gentleman from Georgia offering this amendment to kill the bill without a vote to kill the bill, says, America is doing so well, why jeopardize it? So I urge Members to study the two alternative approaches. In fact, the gentleman from Georgia today says America is not doing so good, we've got to be careful; we're losing IPOs, we're losing things. The argument that we have been hearing, and he is joined by others in making it, is that we're losing them primarily to England because of the corporate practices in England. That's what the committee appointed by the Secretary of the Treasury said, or inspired by him said. That's what the McKinsey report said: England does this. What we are proposing today is exactly the model that has been followed in England. If you believe what the gentleman from Georgia said, which is that we are losing financial business, I think that has been overstated, but we are losing financial business to others, and the country that we are told we are losing it to does exactly what we are doing. The fact is that letting the people who own the company vote on information that the SEC has required the company to put forward as to whether or not they approve or disapprove that that's what the people they hired should be paid is not at all intrusive. It hasn't caused problems in England. We think it has had a reasonable effect in moderating corporate excesses. That is why I hope that we will vote down this amendment. By the way, if this amendment is voted down, the people who don't want to vote for the bill don't have to vote for the bill. But they ought to be willing to vote ``yes'' or ``no'' on the bill and not defeated by this kind of wording which gives people a chance to vote ``no'' without standing up and doing it.

Mr. FRANK of Massachusetts. Mr. Speaker, I rise in opposition to the motion to recommit.

Mr. FRANK of Massachusetts. Mr. Chairman, I move to strike the requisite number of words. Let me begin with the gentleman from New Jersey's worrying that the investor might be hurt by what we would do. I guess the motto of investor in this case should be ``Stop me before I vote again.'' How are we going to hurt the investor? We are going to say to those investors, You know the information that is going to be presented to you because the SEC mandated that companies do it? You get to say whether you approve or disapprove of that proposal. That is going to hurt the investor? Are investors so much in need of protection from themselves that they must be prevented from voting on this? This is part of the problem. It is an inversion of capitalism here. The CEOs don't own the company. The boards don't own the company. The shareholders own the company. They are the market. And all this bill does is to empower them. By the way, when the gentleman from Illinois says we are rushing in, he has a very different definition of ``rushing in'' than I do. This takes effect in 2009. We, in fact, were approached by some, the Business Roundtable. They still don't like the bill.

Mr. FRANK of Massachusetts. Mr. Chairman, I move to strike the requisite number of words. First, Mr. Chairman, I look forward to the subdebate between the gentleman from Illinois and the gentleman from Georgia on the Republican side. Just to recap, I said I was glad that the gentleman from Georgia, apparently on behalf of the Republicans, agreed with what the SEC did. The gentleman from Illinois took me to task and said, nothing in the amendment was approving. So I said, okay, I withdraw the notion that it was approving. But then the gentleman from Georgia came back and said, it does approve. So I would urge the two of them to work that out. I would be glad to either give them the acknowledgment, as the gentleman from Georgia said, that they support it; or retract that compliment to Mr. Cox, as the gentleman from Illinois prefers. But I am confused now as to their difference. As to the gentleman from Florida's amendment, it does exactly what our amendment is inaccurately accused of doing, it intrudes the Congress into the internal pay decisions of the corporation. We are strictly, scrupulously, completely neutral as to how the corporations pay their CEOs and others. We simply say that the market should work, that these shareholders should decide. And the gentleman said, shareholders have that right now. They do in some places, they do in some States, they do in some corporations; they do not in others. There is no uniform, legally enforceable right for shareholders to do this; and some corporations have refused to do it. United Health Service recently refused a request from a pension fund to do that. There is no uniform right. By the way, it is a matter of State law or Federal law. This notion that we are intruding on the private corporation, as they said on Wednesday, makes no sense. Private corporations are the creation of positive law, and positive law says, here are the rights and here are the duties, et cetera. Indeed, the gentleman from Georgia, who, unlike the gentleman from Illinois, approves of what the SEC did, says Washington shouldn't decide. But on the other hand, he is for what the SEC did. Has the SEC decamped to Wichita when I wasn't looking? I would have thought, as chairman of the committee, if the SEC had moved out of Washington, someone would have told me. Maybe they're not getting my mail. But how can you say that Washington should tell corporations what to do and be so supportive of this SEC intervention? And on the subject of intervention, what the gentleman from Florida would do, would have us say is, you have to have a shareholder vote if you have certain kinds of compensation, but you don't have to have a shareholder vote if you have other kinds of compensation. And what is the majority, and is it nonqualified deferred? It would be a far greater intrusion both substantively and procedurally than what we say. We say, have a vote, let the shareholders vote. Terribly radical. Let those people who own the corporation give their opinion on what the CEO should be paid. The gentleman from Florida says ``no,'' but here is the deal: Some corporations hate that. They don't want these pesky shareholders having a say on how many hundred million dollars a guy ought to get when he gets fired, so we will say ``yes'' in some cases, ``no'' in others. The gentleman said we should kind of give them an incentive. Well, I don't think that is the case. I don't think Congress ought to be picking and choosing as to what is the right kind of corporate compensation and what is not the right kind of corporate compensation. But that is what the amendment does. The amendment does exactly what, as I said, our bill carefully avoids doing: It puts Congress into the decision-making process and says, if you do it the way we, Congress, think is right, you are okay; if you don't do it the way Congress thinks is right, you have a shareholder vote. Now, I don't think a shareholder vote is any problem. But for those who do, if you really do, then you are intruding the Congress into that process in a way that we have sought to avoid. So I hope that the amendment is defeated.

Mr. FRANK of Massachusetts. I apologize, then. I inferred that the Members on the other side were being supportive of what our former colleague, Mr. Cox, did. If, in fact, I have incorrectly assumed that my colleagues were supportive of what the Republican SEC has done, rather than simply taking account of it, I will withdraw that, and I will not impute to you approval of what Mr. Cox has done.

Mr. FRANK of Massachusetts. Mr. Chairman, I demand a recorded vote.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. The gentleman should give my friends on the other side credit for consistency. As he knows, their definition of democracy has recently frequently included throwing votes away.