Tom Harkin

Mr. HARKIN

Mr. HARKIN. It is 3640.

Mr. HARKIN. Madam President, here is the situation, for all Senators. We are now going to be having a series of votes. The first vote will occur on the amendment by the Senator from Minnesota, Ms. Klobuchar. That will be a 15-minute vote. The next three votes will be Senator Tester's amendment, then Senator Brown's amendment, and then Senator Craig's amendment. Those will be 10-minute votes. Each one of these has a 60-vote threshold.

Mr. HARKIN

Mr. HARKIN. Mr. President, I thank the Senator from Iowa for offering this amendment. I am a cosponsor and a proud supporter. I have been listening to the debate taking place, and quite frankly I do not understand the opposition by the Senator from Kansas. After all, as Senator Grassley pointed out, this is not the original bill. It was modified quite a bit. All this amendment really does is create an Agriculture Competition Task Force to study problems in agricultural competition, establish ways to coordinate Federal and State activities, address unfair and deceptive practices in concentration, create a working group on buyer power to study effects of concentration in agriculture, and make recommendations to assist the Department of Justice and the Federal Trade Commission in drafting agricultural guidelines. I don't know that anything could be more advisory than that. All we are doing is saying, use the expertise they have at the Department of Agriculture to look at these issues and advise and inform DOJ. It doesn't say that DOJ has to do what they say. It doesn't say they have to follow everything they say. It is advisory. I don't see why there would be such an objection to this kind of advice which would be given to DOJ and the Federal Trade Commission. There are some other things in there, but that is sort of basically the essence. Again, as many times as we have seen decisions come down from the Department of Justice and the Federal Trade Commission, you wonder if they have anybody over there who understands anything at all about rural America. You wonder how many of these lawyers over there at the Department of Justice--I don't want to pick on any schools; we always say Harvard-trained lawyers and Yale-trained lawyers--have had any dirt under their fingernails from a farm or how many of them know anything about livestock issues. This is a good amendment. Quite frankly, I am surprised there is this kind of opposition. Having said that, I wonder if the Senator from Iowa--if we could ask to set the amendment aside temporarily so we can move on to a couple other amendments.

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

Mr. HARKIN. Mr. President, would the Chair please state what the amendment is before the Senate right now?

Mr. HARKIN. Mr. President, that is the amendment I had sent to the desk prior to the quorum call being established?

Mr. HARKIN. I thank the Chair. This is basically an extension of the Commodity Exchange Act of 2013. I wish to state for the record we would not ordinarily include the Commodity Exchange Act in the farm bill, but for various reasons we were unable to reauthorize the CEA in the last Congress. This amendment further regulates energy transactions that perform a significant price discovery function. This is an issue Senators Feinstein and Levin have been working hard on. The amendment also addresses fraud and retail transactions in foreign exchange markets. It gives the CFTC broader authority to prosecute fraud in other commodities such as heating oil. I am very pleased we are able to work through the reauthorization issues with the ranking member, Senator Crapo, and numerous cosponsors of this amendment. I yield the floor.

Mr. HARKIN. Mr. President, I ask unanimous consent to add onto that amendment Senators Dorgan, Durbin, and Conrad as cosponsors.

Mr. HARKIN. Mr. President, will the Senator yield?

Mr. HARKIN. Mr. President, I thank the Senator for his comments, and I thank him for all his help throughout a long year in the Agriculture Committee, helping us with our budget problems and getting us to this point. I appreciated the fact that the Senator said the managers had handled this bill with grace. The Senator doesn't see what I do when I go home. I act out my frustrations later. I say to the Senator, it has been frustrating, but that is the process of the Senate. The Senator is absolutely right, our leader is correct in calling for cloture. I am not disappointed. I am managing the bill under the rules we had, which was to try to accommodate as many amendments as possible, to move them as rapidly as possible, to get votes on them. Let's face it, we have had enough, and we have had enough amendments and we debated them. This is a good bill. Some of the amendments that were not adopted maybe I wish were, and some that were adopted maybe I wish were not. That is the process. It is a good bill with which to go to conference. It is a bill that does a lot, as the Senator knows, in energy, it does a lot in conservation, and it provides a great safety net for our farmers, and what we do for specialty crops that we have never done before in any farm bill, and what we do for nutrition. We answer the call of church groups and people around the country who said we had to do more to take care of low-income people in the Nation and to meet our obligations to the poorest among our society. We have done that in this bill. We have done great work in the food stamp and nutrition programs. It is a good bill. All of us worked very hard on it. We will go to cloture this evening. Quite frankly, I am not disappointed. I am happy we are bringing this to a close so we can get to conference. I hope we can get the conference concluded by the time we get back in January so we can have a conference report sometime toward the end of January. I thank the Senator from North Dakota for his many kindnesses, for all of the hard work he has done, and his staff through this long process in getting us here. I thank him very much.

Mr. HARKIN. I agree. The only reason I was saying this is, keep in mind there is a limited amount of time. So I am saying, anyone who believes they have a germane amendment in this list, they ought to probably want to debate it tonight. I suggest the absence of a quorum.

Mr. HARKIN. Mr. President, we are now operating postcloture on the farm bill. As we know, there are 30 hours. And germane amendments are obviously acceptable postcloture. Right now I am working with Senator Chambliss to try to come up with a roadmap on how we proceed on this yet this evening and tomorrow. We had basically a kind of a finite list. Since there were only 20 amendments allowed on either side, we kind of know what that universe is. Prior to the cloture vote, we were down to about 11--if the Chair will indulge me, 11 votes that could be held. Now some of those, it is just my own observation, without being the Parliamentarian, are nongermane. For example, one of my own amendments I can truthfully say is not germane. The others I do not know, and those will have to be decided by the Parliamentarian. I would say, however, if there is anyone here who has a germane amendment--and I do believe perhaps the Feingold-Menendez amendment appears to be fully germane. Now, again, there may be an objection raised to that, and the Parliamentarian will have to decide it, but that seems to me--that seems to be one in front of us now that is germane. I would say if the authors of that amendment, either Mr. Feingold or Mr. Menendez, were willing to debate that amendment this evening, under some reasonable time limit, we would like to do that. So I hope that is at least one we might get to tonight that looks to be thoroughly germane to the bill. There is the Grassley-Kohl amendment. I am not certain about that one. That one is maybe a little bit more uncertain. But, again, that is up to the Parliamentarian to decide. But at least that decision could be made, and we might be able to move ahead. So with the concurrence of my ranking member----

Mr. HARKIN. Right. The Coburn amendment is probably germane.

Mr. HARKIN. How much more in allocation would California need to keep the facility in Mendota open?

Mr. HARKIN. I appreciate the Senator providing that information. Can she suggest a possible solution that would allow the Mendota refinery to remain open?

Mr. HARKIN. I will raise this issue when the Senate and House meet to finalize a farm bill conference report.

Mr. HARKIN

Mr. HARKIN. Mr. President, I ask unanimous consent that there now be a period of morning business with Senators permitted to speak therein for up to 10 minutes each.

Mr. HARKIN

Mr. HARKIN. Mr. President, I am here today to introduce, along with Senator Kohl, the Defined Contribution Fee Disclosure Act. This legislation is designed to address what may seem at first glance like a small issue, but in fact has a dramatic impact on the retirement security of millions of Americans who have 401(k) plans. Not many people realize this, but the Employee Retirement Income Security act, ERISA, does not require plan sponsors to provide participants with information on the level of fees that participants are charged by the various plans they have to choose between. The number of people participating in defined contribution plans grows every year, and unfortunately, these plans are a bigger part of their nest egg as employers freeze their defined benefit plans. One of the key challenges as we move away from guaranteed benefits is making sure people have all the relevant information to help them decide which plan will best serve their needs. Recently, AARP conducted a survey in which it asked individuals with 401(k) plans if they even knew what they paid each year in fees. Only 17 percent of people asked said that they know what their fee levels were. This is far from an academic matter. In fact, this could be disastrous for folks when they reach retirement. One person--who wishes to remain anonymous--recently shared with me a story that highlights what's at stake. She noticed one day that her 401(k) wasn't actually earning anything at all. After some examination, she found that the agent who set up the plan for the company received a fee of 2 percent annually for the first five years, reduced to .25 percent after that, paid by the employees and not the company. The investment firm charged a fee of 1.25 percent which they said was standard for companies with under $1 million in their 401ks. So, last year, she was paying 3.25 percent in fees and earning less than 4 percent from her money market fund. She didn't have a clue about the fees until she inquired after she realized she wasn't making any money on the fund. So looking back at this AARP survey, of those 17 percent who said they knew what their fees were, 33 percent thought they weren't being charged any fees at all. Some companies will even tell people they are not being charged fees. While it is true that in some cases, employers pay fees, that is hardly the norm. And investment managers don't do their jobs for charity. These fees that people don't know about can have a big effect on what they end up with at retirement. The U.S. Government Accountability Office recently estimated that a 45 year old with $20,000 in his 401(k) would have $70,555 at age 65 for his retirement, assuming he was getting a 6.5 percent return and only paying 0.5 percent in fees. But that figure decreases dramatically if the fees are increased by just a single percentage point, to 1.5 percent. At that figure the same individual, investing the same amount of money, would have only $58,400 for his retirement, or more than $12,000 less. AARP took the GAO assumptions and created some additional examples. Consider this case: if a 35 year old invested $20,000 in a 401(k) plan over 30 years, paying 0.5 percent in fees, that individual would have $132,287 for retirement. But increase the fees to 1.5 percent, and the amount available for retirement is only $99,679--that is a 25 percent reduction in the account balance. Even if the fee only increased from 0.5 percent to 1 percent, the value of the retirement account would be reduced by $17,417, or a little over 13 percent over the 30-year period. If you awoke one day to find that your bank account, or your retirement account, had declined in value by 25 percent, you would understandably be alarmed, and you would act quickly to fix the problem. But with high 401(k) fees, the reduction in benefits isn't immediately obvious. It happens slowly, over time, and often flies under people's radar screens because they are not told the level of fees they are paying, or they don't understand that some 401(k) plans charge far lower fees for providing the same amount of services. It is that problem--that information gap--that the Defined Contribution Fee Disclosure Act is designed to fix. My bill would provide participants with easily understandable information about the fees that they are paying. This information will be provided to them before they pick which plans they want to invest in, and again, regularly, on their quarterly statements. In addition, this bill does something even more important: it would require companies to disclose more information to plan sponsors. Right now, if you provide your workers with a 401(k) plan, you are required to act prudently and in their sole interest in your fiduciary duties. However, there are hidden fees that are sometimes not disclosed even to plan sponsors, and sometimes those sponsors also are not told about business arrangements between service providers to steer participants into investment options in which they have a stake, a classic conflict of interest. To fix this, the bill would require 401(k) plan providers to disclose all fees and relationships between service providers to the people selecting the plan a company will ultimately offer. The bottom line is that we want to create a situation where companies are picking several good options for their employees that all have decent reliable returns and fair fees. One thing my bill does not do is set a limit on fees that can be charged. As I have noted, high fees can make a real difference in account balances at retirement, but so can high returns, in a more positive direction, obviously. Sometimes, it is well worth paying higher fees if a small increase in fees will have a big effect on returns. In addition, some people want to purchase insurance products so that every month, they are buying a more secure piece of retirement. That is just fine, and my bill doesn't touch that. People who fully understand the real cost of a guaranteed return at retirement are the kind of people who appreciate, and will push for, more defined benefit plans. But they can't do that if they don't know what it costs. The bottom line is that people need to be investing more, and more confidently, in the 401(k) plans they are being offered. This is especially critical in a world where defined benefit plans are increasingly being slashed and frozen. For a growing number of workers, their only source of retirement income is their 401(k). Congress needs to focus more squarely on how we get workers to participate in the plans they have available, and what we can do to make sure the savings they grow in them are adequate. When people know they are being given all the facts in an easy-to-understand manner, they are more likely to contribute. And when the fiduciaries who are supposed to be looking out for them make sure all of their options are good, they end up saving more money at the end of the day. This bill is a win for companies who want to provide their workers with a secure retirement, it is a win for 401(k) providers who have been providing reasonable fees all along, and it is a win for every American who has one of these plans. My colleagues and I introducing this measure have worked with interested parties on every side of this issue to make sure we're taking into account everyone's views. We also intend to work closely with the Department of Labor on their proposed regulations on this issue. While we believe that Congress has an obligation to address this issue, if we can all work together to develop regulations that address this issue in a way that will truly help participants and beneficiaries get a good deal, I am certainly not opposed to getting this done administratively. I strongly encourage my colleagues to cosponsor this measure.

Mr. HARKIN

Mr. HARKIN. Mr. President, I am here today to introduce, along with Senator Kohl, the Defined Contribution Fee Disclosure Act. This legislation is designed to address what may seem at first glance like a small issue, but in fact has a dramatic impact on the retirement security of millions of Americans who have 401(k) plans. Not many people realize this, but the Employee Retirement Income Security act, ERISA, does not require plan sponsors to provide participants with information on the level of fees that participants are charged by the various plans they have to choose between. The number of people participating in defined contribution plans grows every year, and unfortunately, these plans are a bigger part of their nest egg as employers freeze their defined benefit plans. One of the key challenges as we move away from guaranteed benefits is making sure people have all the relevant information to help them decide which plan will best serve their needs. Recently, AARP conducted a survey in which it asked individuals with 401(k) plans if they even knew what they paid each year in fees. Only 17 percent of people asked said that they know what their fee levels were. This is far from an academic matter. In fact, this could be disastrous for folks when they reach retirement. One person--who wishes to remain anonymous--recently shared with me a story that highlights what's at stake. She noticed one day that her 401(k) wasn't actually earning anything at all. After some examination, she found that the agent who set up the plan for the company received a fee of 2 percent annually for the first five years, reduced to .25 percent after that, paid by the employees and not the company. The investment firm charged a fee of 1.25 percent which they said was standard for companies with under $1 million in their 401ks. So, last year, she was paying 3.25 percent in fees and earning less than 4 percent from her money market fund. She didn't have a clue about the fees until she inquired after she realized she wasn't making any money on the fund. So looking back at this AARP survey, of those 17 percent who said they knew what their fees were, 33 percent thought they weren't being charged any fees at all. Some companies will even tell people they are not being charged fees. While it is true that in some cases, employers pay fees, that is hardly the norm. And investment managers don't do their jobs for charity. These fees that people don't know about can have a big effect on what they end up with at retirement. The U.S. Government Accountability Office recently estimated that a 45 year old with $20,000 in his 401(k) would have $70,555 at age 65 for his retirement, assuming he was getting a 6.5 percent return and only paying 0.5 percent in fees. But that figure decreases dramatically if the fees are increased by just a single percentage point, to 1.5 percent. At that figure the same individual, investing the same amount of money, would have only $58,400 for his retirement, or more than $12,000 less. AARP took the GAO assumptions and created some additional examples. Consider this case: if a 35 year old invested $20,000 in a 401(k) plan over 30 years, paying 0.5 percent in fees, that individual would have $132,287 for retirement. But increase the fees to 1.5 percent, and the amount available for retirement is only $99,679--that is a 25 percent reduction in the account balance. Even if the fee only increased from 0.5 percent to 1 percent, the value of the retirement account would be reduced by $17,417, or a little over 13 percent over the 30-year period. If you awoke one day to find that your bank account, or your retirement account, had declined in value by 25 percent, you would understandably be alarmed, and you would act quickly to fix the problem. But with high 401(k) fees, the reduction in benefits isn't immediately obvious. It happens slowly, over time, and often flies under people's radar screens because they are not told the level of fees they are paying, or they don't understand that some 401(k) plans charge far lower fees for providing the same amount of services. It is that problem--that information gap--that the Defined Contribution Fee Disclosure Act is designed to fix. My bill would provide participants with easily understandable information about the fees that they are paying. This information will be provided to them before they pick which plans they want to invest in, and again, regularly, on their quarterly statements. In addition, this bill does something even more important: it would require companies to disclose more information to plan sponsors. Right now, if you provide your workers with a 401(k) plan, you are required to act prudently and in their sole interest in your fiduciary duties. However, there are hidden fees that are sometimes not disclosed even to plan sponsors, and sometimes those sponsors also are not told about business arrangements between service providers to steer participants into investment options in which they have a stake, a classic conflict of interest. To fix this, the bill would require 401(k) plan providers to disclose all fees and relationships between service providers to the people selecting the plan a company will ultimately offer. The bottom line is that we want to create a situation where companies are picking several good options for their employees that all have decent reliable returns and fair fees. One thing my bill does not do is set a limit on fees that can be charged. As I have noted, high fees can make a real difference in account balances at retirement, but so can high returns, in a more positive direction, obviously. Sometimes, it is well worth paying higher fees if a small increase in fees will have a big effect on returns. In addition, some people want to purchase insurance products so that every month, they are buying a more secure piece of retirement. That is just fine, and my bill doesn't touch that. People who fully understand the real cost of a guaranteed return at retirement are the kind of people who appreciate, and will push for, more defined benefit plans. But they can't do that if they don't know what it costs. The bottom line is that people need to be investing more, and more confidently, in the 401(k) plans they are being offered. This is especially critical in a world where defined benefit plans are increasingly being slashed and frozen. For a growing number of workers, their only source of retirement income is their 401(k). Congress needs to focus more squarely on how we get workers to participate in the plans they have available, and what we can do to make sure the savings they grow in them are adequate. When people know they are being given all the facts in an easy-to-understand manner, they are more likely to contribute. And when the fiduciaries who are supposed to be looking out for them make sure all of their options are good, they end up saving more money at the end of the day. This bill is a win for companies who want to provide their workers with a secure retirement, it is a win for 401(k) providers who have been providing reasonable fees all along, and it is a win for every American who has one of these plans. My colleagues and I introducing this measure have worked with interested parties on every side of this issue to make sure we're taking into account everyone's views. We also intend to work closely with the Department of Labor on their proposed regulations on this issue. While we believe that Congress has an obligation to address this issue, if we can all work together to develop regulations that address this issue in a way that will truly help participants and beneficiaries get a good deal, I am certainly not opposed to getting this done administratively. I strongly encourage my colleagues to cosponsor this measure.

Mr. HARKIN

Mr. HARKIN. Mr. President, I ask unanimous consent that the Senate proceed to the consideration of S. Res. 405, which was submitted earlier today.

Mr. HARKIN. Mr. President, I ask unanimous consent that the resolution be agreed to, the preamble be agreed to, and the motions to reconsider be laid upon the table.

Mr. HARKIN

Mr. HARKIN. Mr. President, I ask unanimous consent that the Committee on Commerce, Science, and Transportation be authorized to meet during the session of the Senate on Thursday, December 13, 2007, at 10 a.m., in room 253 of the Russell Senate Office Building, for the purposes of conducting a hearing. At this hearing, the committee members will hear from the five Federal Communications Commission comissioners on current proceedings involving media and telecommunications policy.

Mr. HARKIN. Mr. President, I ask unanimous consent that the Committee on Energy and Natural Resources be authorized to meet during the session of the Senate on Thursday, December 13, 2007, at 2:30 p.m., in room SD366 of the Dirksen Senate Office Building in order to conduct a hearing. At this hearing, the committee will hear testimony regarding forest restoration and hazardous fuels reduction efforts in the forests of Oregon and Washington.

Mr. HARKIN. Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the Session of the Senate on December 13, 2007. At 10:30 a.m., in order to conduct a hearing entitled ``Shopping Smart and Avoiding Scams: Financial Literacy During the Holiday Season.''

Mr. HARKIN. Mr. President, I ask unanimous consent that the Committee on the Judiciary be authorized to meet during the session of the Senate in order to conduct an Executive Business meeting on Thursday, December 13, 2007, at 10 a.m. in room SD-226 of the Dirksen Senate Office Building. Agenda I. Resolutions of Contempt II. Bills S. 2402, FISA Intelligence Surveillance Substitution Act of 2007, (Specter); S. 344, A bill to permit the televising of Supreme Court Proceedings, (Specter, Grassley, Durbin, Schumer, Feingold, Cornyn); S. 1638, Federal Judicial Salary Restoration Act of 2007, (Leahy, Hatch, Feinstein, Graham, Kennedy); S. 1829, Protect Our Children First Act of 2007, (Leahy, Hatch, Schumer); S. 431, Keeping the Internet Devoid of Sexual Predators Act of 2007, (Schumer, McCain, Grassley, Specter, Kyl); S. 2344, Internet Safety Education Act of 2007, (Menendez). III. Resolution S. Res. 388, Designating the week of February 4 through February 8, 2008, as ``National Teen Dating Violence Awareness and Prevention Week'', (Crapo, Biden).