Orrin Hatch

Mr. HATCH

Mr. HATCH. Mr. President, I will have a little bit to say about what the distinguished Senator from Massachusetts has been talking about, but I rise in opposition to the Kennedy amendment to S. 256, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. Now, it is important that colleagues on both sides of the aisle fully understand what this amendment does to our bankruptcy laws and what it does to the prospects for reform. Before I start, I will take a few minutes to remind everyone what this bill is all about. The short answer is fairness. Those who can pay their bills should pay their bills. That is the American way. All law-abiding, bill-paying consumers pay when some do not repay their obligations. You and I and every citizen of this country is going to pay if we allow people who can pay to escape their obligations, and this bill stops the gaming. This is not too revolutionary an idea, but to listen to some of the opponents of this legislation on the floor these last few days, one would think we are trying to square a circle. I have been down on this floor quite a bit over the last few days and I have heard many of the arguments from the few Senators against this bill, and I emphasize the ``few Senators against this bill.'' It sounds pretty familiar. I have been around this place for a long time and I only know one thing for sure. At the end of the day, some on the losing side will think that the underlying bill is without any merits at all and that their concerns have not been treated with the seriousness they feel they deserve. The principal substantive argument we have heard is that this bill goes too far and too fast; we have to take it slow; we have to rethink this; this bill is too extreme, they say. For some of my colleagues across the aisle, this is the same old song we have heard now for 8 solid years that we have tried to put this bill together and it has always had huge bipartisan support. That is bipartisan support, Democrat and Republican support. I am a bit confused by some of the arguments that have been used on some of the same old amendments and against the bill itself. Sure, there are places we could have done better in this bill, as in every other legislation. There are always things we could do better. But the votes we have gotten on this bill, on its amendments in committee, and in previous Congresses are as good an indication as we can ever have of the underlying reasonableness of these proposals. As a long-time supporter of the bankruptcy bill, I was extremely pleased by the strong bipartisan vote we had on cloture yesterday, 69 to 31. That is not just Republicans; there are a lot of Democrats who know this bill is the answer to a lot of the problems we have in bankruptcy in our society, and who have been working with us for 8 solid years in a bipartisan fashion. But to hear some of our critics, one would think that everybody concerned, all 69 of us, are nutcakes who do not know what is going on in our society or do not care for the poor, or for the weak, or for the worker, or for the union man. Give me a break. I am one of the few people in this body who ever held a union card. I worked for 10 years in the building construction trade unions, earned my journeyman's card as a wood, wire, and metal lather, now a carpenter today, and I am darned proud of that. I think a lot about people who are not as fortunate as we are in the Senate. As a long-time supporter of the bankruptcy bill, I was extremely pleased by the strong bipartisan vote, 69 to 31, on cloture. That was a big bipartisan vote by any measure. This vote is in keeping with the long record of bipartisan support for this bill over the life of the legislation. I will briefly review this history: We held our first meeting on this in a Judiciary subcommittee in 1998. I want to make sure everyone heard that right: 1998. Early on, the good-faith compromises began. To give everybody an idea, these are some of the amendments we accepted in committee over the last 7 years. We modified the homestead exemption. We modified the means test. We allowed for sanctioning of attorneys who file abusive claims. We made privacy concessions for filers. We prevented creditors from demanding repayment for debts incurred through predatory lending practices, something that has long been overdue for the poor, the weak, and the unfortunate. All of these were amendments from my Democratic colleagues. I could go through dozens of others. Two weeks ago, the Judiciary Committee held another markup on the bankruptcy legislation. We adopted five more amendments proposed by our Democratic colleagues. If some of the amendments that have been proposed on the floor sound similar to the matters I listed, that is because they are. Taken in a vacuum, as it might sound to anyone who randomly tunes in on C-SPAN, these amendments might sound reasonable. Yet in proper context of past history and compromises, many of these amendments should be understood for what they are: more of the same. Many of the amendments address issues we have already negotiated previously. Frequently, these amendments make this a better bill. But now after so many years of hearing the same complaints, even after we attempted to address concerns by accepting or modifying amendments, including, I repeat, five in their latest and hopefully last markup of bankruptcy reform in the Judiciary Committee, it is less than clear that some of these remaining amendments will improve this already fully vetted bill. The five amendments adopted in the markup ran the gamut. One was a technical fix that created a more restrictive inflation adjustment plan. We decided to prevent corporate executives--that is corporate executives, by the way--from declaring bankruptcy to avoid paying fines for securities fraud. That does not sound like something that hurts the little guy. We are trying to stop this type of fraud. We accepted three amendments from the senior Senator from Massachusetts, Mr. Kennedy. We clarified the means test, even in an instance where we sincerely believed that the means test was already more than clear, to explain that without any debt, health and disability expenses will not be included against a filing for bankruptcy. We allowed for a trustee in cases of fraud involving persons representing the debtor. In an amendment that many think we went too far on, we even accepted a compromise version of an amendment that restricted payments to executives and businesses going through a bankruptcy. Unfortunately, this amendment may discourage senior officials from taking on the task of seeing a company through a difficult financial reorganization. The unintended consequences of this might be to further limit the ability of damaged companies to emerge from bankruptcy and to keep thousands of employees on the job. They may lose those employees. Those employees may lose their jobs if we cannot keep good, competent executives there. I think this issue deserves more attention. But we agreed to it. I am hopeful. I have been chatting with my good friend from Massachusetts and he has indicated he thinks we might be able to resolve that problem so people will not lose their jobs. But it depends upon what he thinks, not on what I think, because I accepted the amendment in committee, as the person who was in charge of the committee at that time. Fairness demands that we work with our colleagues in the minority but this is a two-way street. Fairness also demands that large bipartisan majorities, after they have done all they can to reach agreements with the other side, be allowed to move on. That is why we invoked cloture, so we can move on. This bill is a case study in such accommodation. I could go through dozens and dozens more accommodations we made to the other side, and to people on this side as well. This bill first passed all the way back in the 105th Congress. Let me refer to this chart. In the 105th Congress we passed this bill 97 to 1. I don't think everybody who voted for this was an idiot, who did not care for the poor and the weak and the infirm and the downtrodden. No. We are trying to solve some of their problems. This bill passed the Senate by a 97 to 1 vote. You cannot get much more support than that. There is no denying the bipartisanship of that vote. When we came back to the issue in the 106th Congress, we again had massive bipartisan support for this bill. The Senate passed H.R. 833 on February 2, 2000, 83 to 14. I think that was a pretty good bipartisan vote. It is virtually the same bill. Then the conference report came back and on December 7, same year, 2000, we passed this same bill 70 to 28. That was a big bipartisan vote--which was right. That bipartisan conference report was supported by Democrats and Republicans. That was vetoed with a pocket veto by President Clinton. He had a right to do that, but he pocket-vetoed it because it didn't have an abortion amendment on it. What about the 107th Congress? Did we give up hope? I can tell you that I did not. I just could not believe, I still cannot believe that a bill with such wide support could repeatedly fail to become law. So what did we do in the 107th Congress? Let me refer to this chart. In the 107th Congress, on March 15, 2001, this bill passed again, 83 to 15, and then passed again, 82 to 16. Those are bipartisan votes. I don't think the Democrats who voted with us are idiots or did not care for the poor. I don't think they failed to acknowledge that we have to take care of those who are unfortunate in our society. They did acknowledge that it cost every family in America $400 extra because of what is going on in this system. All in all, the full Senate has voted favorably on bankruptcy reform legislation five times. Five times, all sweeping bipartisan votes, and the bill is not yet signed into law. If we adopt any of these amendments from people who will never vote for this bill no matter what we do--they would rather criticize it than vote for it. I can criticize aspects of this bill myself, I believe. But it is a classic working together in the best methodology that we have, to bring everybody together and get legislation done that will do a lot of good. It will cause people, who can afford to, to pay their bills, or at least pay some of their bills. It seems to me that is the American way. We want to teach our children, our young people, that it is important to pay your bills. It is important to live up to your responsibilities. We do a lot to make sure corporate America lives up to their responsibilities in this bill as well. The bill is not signed into law yet, but we hope we can get it through--apparently not tonight, but by tomorrow. If not tomorrow, then Friday. If not Friday, Saturday. As far as I am concerned, whatever it takes to get it done. These reform-minded votes are not just coming from the Senate. Here is how the House voted over the years, just so everybody knows. There are 535 Members of the House. Here is how they voted: 300 to 125; 313 to 108; 306 to 108. Overwhelming bipartisan votes, because this bill is the best we can do. It will do a lot of good, to make things right in our society. With all due respect, these are not even close calls. They are consistent, bipartisan blow-outs. But, to listen to the opposition, you would think this legislation is supported by only a small minority of Representatives in the House of Representatives or in the Senate. Nothing could be further from the truth. I really do not know what else we can do. We have compromised when it was reasonable to do so. As a matter of fact, in our very first subcommittee debate on this issue we accepted an amendment from my distinguished colleague, the Senator from Illinois, that adjusted the requirements for being subject to the means test. That amendment created a safety valve for those who fall below the national median income. This was an important amendment. This bill does not track it exactly, but our exclusion of those who fall below the State median income takes this original amendment as a guide. It materially limited the reach of the means test. It allowed a fresh start to those poor people who are drowning in a sea of debt with no way to pay it back. I said many times during this debate and I will say it again: 80 percent of bankruptcy filers will be excluded from the means test--80 percent. They will be permitted to file chapter 11, which will completely wipe out their debts. The supposed draconian means test has results in only one half of the mere 20 percent that it even applies to. It allows those with incomes that remain above the State median income, after numerous health and education and other exceptions, to pay back some of their debt over the course of 3 or 5 years. It gives them even a break there. When all is said and done, the means test in this bill will only result in about 1 in 10 individuals who file bankruptcy from ever having to pay some of their past debts with future earnings. So 10 percent of 100 percent will have to do some payback because they can afford to do it. It is only right. They should not saddle all America with their debts when they can afford to pay them back. But in the first markup, the man who is now the minority whip, my friend from Illinois, proposed the amendment that remains at the heart of the means test in this bill, and we accepted it. What is amazing to me is that when my colleagues want to raise taxes they are always talking about how great the means test is. But when we want to make sure that people who can pay can pay, suddenly the means test is not a good test. You can't have it both ways. It is amazing to me. It is almost hypocrisy. I am pleased that cloture has been invoked, giving us the opportunity to once again pass this bill. It is getting to the point where some might even forget why we initiated this legislation. We have been at it for 8 years now. Some of those who oppose the bill and are offering final postcloture amendments are flying in the face of years and years of hard work and bipartisan compromise. By the way, the ones who bring up the amendments will never vote for this bill no matter what you do, unless it is a complete cave-in, so we cannot solve the problems that are eating our country alive in bankruptcy. And they do it under the guise that they are trying to protect the weak and the infirm and those who really cannot help themselves. Give me a break. We over here get so tired of those populist arguments. We hear them over and over and sometimes I think they think the more they yell and scream the more people must think their arguments are serious. I hope people are listening because, my gosh, after 8 years of compromising and working and bringing people together and listening to both sides and doing everything we can to accommodate, why do we have to go through all the same amendments over and over again; they have been defeated time and time again because they deserve being defeated. Yet it happens every time--they get up and act like the world is coming to an end because their populist rhetoric is not being listened to. Unfortunately, there are people out there who really believe this stuff when somebody starts yelling, screaming, and shouting on the Senate floor. The fact is that many of these final amendments being proposed during this debate are just further adjustments of adjustments to adjustments that were already made during this process. We have made further adjustments and refinements when we found broad consensus. These amendments have been brought up postcloture. You would think there would be a time when you admit that you have had your shot, you have had 8 years of your shot; you have had amendment after amendment, the same thing over and over again, and the amendments have been defeated. You would think sooner or later they would come to the conclusion to stop holding up the Senate and the people's business and let this bill go; we lost this bill even though we as liberals don't like it. But there are liberals who do like it because they know it is right. They know what we are trying to do here will work to the betterment of the bankruptcy laws of the country. I would like to add that during the course of the floor debate over the last week and a half we accepted more amendments that will improve this bill. The Senate agreed to the Sessions amendment that makes clear that bankruptcy judges must consider military and veteran status and health care costs when determining whether a portion of future income must be used to pay past debt. The Sessions amendment addressed many of the issues presented by Senator Durbin with respect to military personnel and veterans, and Senator Kennedy with respect to health care costs. We accepted the Specter amendment that made clear how bankruptcy judges will be paid through increased filing fees. This important amendment stands for responsible government and eliminates any objection to the legislation based on a budget point of order. In addition, we adopted an important amendment by Senator Leahy that corrects some potential problems that relate to privacy of certain personal information, including Social Security numbers. In short, we have improved this bill on the floor in a number of important aspects. We have been open to our colleagues. We have tried to accommodate them where we can. But there are areas where we can't and have this bill became law. I think that the cloture vote we just took is evidence of those changes to this already moderate legislation. I understand some Senators do not think they have had an adequate hearing. At the beginning of this process, I gave them my word to at least consider amendments from all sides, and I believe we have done so. This institution is rather unwieldy, though. I think anybody who watches it or thinks about it has to admit that. That is probably putting it mildly. Unfortunately, even decent arguments, if they come at the wrong time, are going to have an uphill climb. As I said earlier, since I was first elected I have tried my best to reach out to the other side as a good-faith actor. That is no less true with this bankruptcy bill. I have listened to more proposals and voted on more amendments that I can recall, and so has Senator Grassley and Senator Sessions and others who have worked so hard on this issue. My hope is that as we move forward the opposition remembers the bigger picture. Even those few Senators who will not vote for final passage know that this bill was made better because we have accepted their amendments over the years. At this late date, though, it is difficult to accept many more for procedural reasons. I oppose the amendment offered by the distinguished Senator from Massachusetts for all of these substantive reasons. Let me give a couple more substantive reasons. I accept Senator Kennedy's argument that health care costs are the key factor in bankruptcy. I have heard that for days around here; that most people go into bankruptcy because of health care costs. Much of his argument stems from the so-called Warren study. Let me talk about the Warren study cited by Senator Kennedy and give a response to it by the Department of Justice. Here is what the Department of Justice said. I would suggest that the Warren study has been greatly overplayed here on the floor. They said: Professor Warren, a long-time opponent of bankruptcy reform, and her so-called ``studies,'' should be approached with skepticism. Though Ms. Warren's study claims that more than half of consumer bankruptcies are medically related, the DOJ has told us that only ``the conclusion that almost 50 percent of consumer bankruptcies are `medical related' requires a broad definition and is generally not substantiated by the official documents filed by debtors.'' In other words, this claim that 50 percent of the bankruptcies are caused by medical expenses is pure bull. The means test doesn't apply to the poor or anyone without the ability to re-pay. Anyone under the median income for their State is automatically exempt from the means test. They can go right into chapter 7 and have every one of their debts removed; that is, the poor. To the extent that ``above median'' families have ongoing medical expenses, they are permitted to use those expenses as a reason to not pay their debts. These are people above the median income level. GAO's 1999 analysis of the expenses allowed under the means test clearly shows that the means test permits all debtors to account for health care expenses. For people with repayment capacity and financial resources, the bankruptcy legislation prevents abuse by requiring some of their bills to repaid in exchange for not having to pay the full amount. This is fair. If they can pay some, they ought to pay some. We shouldn't just stick the hospitals and the doctors and everybody in medical care with these unpaid debts. I was talking to one of the large hospital chains the other day. I asked them how much uncompensated debt they had every year; in other words, medical care that you have given that you receive no compensation for. It was almost $1 billion a year that they have given in free medical care for the poor and for some who game the system. Guess who pays for that. You and I, and everybody else in the final analysis because it is going to have to come back in most cases to Medicaid and Medicare. These are Federal programs that wind up with those debts. By the way, we pay for them for a variety of reasons. We don't pay almost $1 billion to those hospitals. They don't get anything in most cases. That uncompensated debt means they are not getting paid. They are giving emergency care. That is why some hospitals are now doing away with emergency care facilities, because they can't keep doing it. People who do not pay their bills raise the cost of everything for all of us. That is OK when they can't pay their bills when they are poor. But when they can, and when they think they can just escape them by going into bankruptcy and they are capable of paying some or all of their bills, they ought to help to do it. For people with repayment capacity and financial resources, the legislation prevents abuse by requiring some of the bills to be repaid in exchange for not having to pay the full amount. If someone can't pay health care debts, the bill does not force them to. This bill will not force them to. If they can pay health care debts, they should repay those debts and those bills just like everybody else has. The Sessions amendment we adopted last week addresses this problem. It simply addresses the problem. Let me close by addressing the investment banker provision my colleague from Massachusetts has strenuously commented upon. I am not sure if strenuous is quite the word, but I will use that word here tonight. It seemed to me a little more than strenuous. Companies in financial distress need the ability to retain good help. They need to be able to keep people on who know the company best and who will enable that company to emerge from reorganization a more healthy outfit that can continue providing for its employees and contribute to the economy. Under current law, investment bankers alone among professionals in the business world were deemed, per se, interested persons who could not work for a company after filing for bankruptcy if they had served as banker for any outstanding security of the corporation. This bill simply extends the test, one of the materially adverse interests that applies to lawyers, accountants, and other professionals to investment bankers. This amendment makes sense. It continues to provide the courts with discretion to exclude bankers from participation in a reorganization while giving companies more flexibility as they attempt to reorganize and save themselves. The amendment under consideration would undo this flexibility by imposing a strict 5-year exclusion on participation by investment bankers. This makes little sense. I will be voting against the amendment. I urge my colleagues to do the same. I especially make the case that this is not special interest legislation, as my colleague says it is. This is a classic message amendment. The message we should send tomorrow is to vote ``no'' on this amendment. When we talk about message amendments, these are amendments that our colleagues know we cannot take for very good reasons, but they are trying to score political points with the Nation. Anyone who looks at these matters carefully and understands the law would say, let's not let these message amendments take over a good bill that can do so much good for our society. We then should vote ``yes'' on final passage because this is a good, balanced, bipartisan, bicameral bill. What gets me down is I have heard these arguments for 8 solid years. Most of them do not make sense. Most of them are message arguments for political reasons by people who will never vote for this bill, basically have not helped bring this bill about, who have not cooperated in trying to bring both Houses together, who are not part of the huge bipartisan consensus on this bill, and who are trying to score political points, hoping we will never come on the floor and refute them. I could not sit back and not come to the Senate tonight because we have to quit making political points. We ought to pass this bill so we can help this country and its people go forward in ways it should. People who can pay their debts ought to. Companies that are doing wrong ought to pay for that. Where there is fraud, this bill will attack it. We can go through so many good aspects of this bill. Could it be better? I have never seen a bill pass here of any magnitude that could not be improved. But we have had 8 years of improvements and this is the bill that will pass if we do not amend it. We should pass it. We should move forward from here. Having said that, that does not mean we should not immediately start work on the next bankruptcy bill to see if there are ways we can improve even this. As this bill becomes law, we will find ways that it may not work as well as we contemplated and we ought to continually oversee this and make sure this bill works in the best interests of all Americans, that it works in the best interests of the poor, and the working people, our union men and women, people who have to make a living all over this country, and for investors and everybody else in our society. We ought to make sure we do the best we can. I assure you we will continue to try and work to continue to improve our laws in this country. That is what this body is all about. I will briefly mention an important issue that arose from the amendment at the markup. This amendment offered by my friend from Massachusetts, Senator Kennedy, seeks to prevent unfair and unnecessary retention bonuses to insiders in chapter 11 companies. The goal here is certainly laudable and I agree with the desire to try to do that, but it has come to light since our markup that this amendment may act to effectively prohibit responsible companies undergoing reorganization-- in other words, trying to save themselves--from keeping key employees who may best be able to steer the company back into solvency. I have a letter from the Association of Insolvency and Restructuring Advisors enumerating these concerns in further detail and I ask unanimous consent it be printed in the Record.

Mr. HATCH. We have language in this issue which would mitigate what I believe are unintended effects of this amendment. Under this modified language, all payments where ``misconduct, fraud, or mismanagement'' is present are prohibited. This language also keeps the burden on chapter 11 companies to prove that retention bonuses are ``necessary, fair and reasonable,'' and ``likely to enhance a successful reorganization.'' This seems like a reasonable fix to me and I hope we include this language in the bill. I appreciate any help my friend from Massachusetts would give on that particular issue because if we are interested in doing what is right, this will do what is right.

Mr. HATCH

Mr. HATCH. Mr. President, I rise today to pay tribute to the legendary playwright Arthur Miller, who passed away on February 10, 2005 at the age of 89. Anyone who has experienced ``Death of a Salesman,'' ``A View from the Bridge,'' ``The Crucible,'' or any of his innumerable masterpieces would certainly agree that Arthur Miller established himself as one of the preeminent American playwrights of our time. A literary genius may have left us, but his work will live forever, from Broadway to the local high school or college theater. Today my colleague from Massachusetts and I submit a resolution recognizing the genius of this literary giant, a man who not only captivated our souls with his art but also motivated us to protect the freedom to speak and write with conviction and courage. I do not want to take up the Senate's time with a long biographical or literary commentary on the life and works of Arthur Miller because I know I would inevitably fail to do justice to him. Instead, I would like to share a personal experience that demonstrated the amazing and unique qualities of this wonderful man. As some in the Senate will remember, one of Arthur Miller's last public speaking appearances was at a hearing before the Judiciary Committee last year, at which he advocated passage of the Hatch-Kennedy Playwrights Licensing Antitrust Initiative Act. The day of the hearing, I had the opportunity to meet privately with Mr. Miller in my Senate office. Though well into his eighties, he spoke with passion and eloquence about the critical importance of live theater and writers to social, intellectual, and political discourse in our country. He also demonstrated his delightful--and occasionally devilish--wit and prodigious intelligence, both of which he had retained in extraordinary abundance. Although we came from very different backgrounds, and radically different political perspectives, it was an honor and a sincere pleasure to come to know--however briefly--a man of his stature, accomplishments, and surpassing intellect. Our lives were enriched by Arthur Miller, and we--as individuals, as a people, and as a Nation--are diminished by the passing of so magnificent an American talent. He will be sorely missed, and will be remembered with reverence and affection by those--like me--whose lives he touched. I hope that my colleagues will join me and Senator Kennedy--who is the leading cosponsor of this resolution--in recognizing and honoring the life and accomplishments of Arthur Miller by supporting swift passage of this resolution. I ask unanimous consent that the remarks of Arthur Miller before the Senate Judiciary Committee on April 28, 2004, be printed in the Record.

Mr. HATCH

Mr. HATCH. 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 Wednesday, March 9, 2005, at 10 a.m. to conduct a hearing on ``The State of the Securities Industry.'' Concurrent with the hearing, the committee intends to vote on the nomination of Mr. Ronald A. Rosenfeld, of Oklahoma, to be a director of the Federal Housing Finance Board.

Mr. HATCH. 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 Wednesday, March 9, at 10 a.m. The purpose of the hearing is to consider the nominations of Patricia Lynn Scarlett to be Deputy Secretary of the Interior and Jeffrey Clay Sell to be Deputy Secretary of Energy.

Mr. HATCH. Mr. President, I ask unanimous consent that the Committee on Environment and Public Works be authorized to meet on Wednesday, March 9, 2005, at 9:30 a.m. to conduct a business meeting regarding S. 131, Clear Skies Act of 2005. The hearing will be held in SD-406.

Mr. HATCH. Mr. President, I ask unanimous consent that the Committee on Finance be authorized to meet in open executive session during the session on Wednesday, March 9, 2005, at 10 a.m., to consider an original bill entitled, Personal Responsibility and Individual Development for Everyone (PRIDE) Act, and to consider favorably reporting the nominations of Harold Damelin, to be Inspector General, Department of the Treasury, Washington, DC, and, Raymond Wagner, to be a member of the Internal Revenue Service Oversight Board, Washington, DC.

Mr. HATCH. Mr. President, I ask unanimous consent that the Committee on Health, Education, Labor, and Pensions meet in executive session during the session of the Senate on Wednesday, March 9, 2005, at 10 a.m. in SD-430.

Mr. HATCH. Mr. President, I ask unanimous consent that the Committee on Homeland Security and Governmental Affairs be authorized to meet on Wednesday, March 9, 2005, at 10 a.m. for a hearing to consider the Department of Homeland Security's budget submission for fiscal year 2006.

Mr. HATCH. Mr. President, I ask unanimous consent that the Committee on Homeland Security and Governmental Affairs be authorized to meet on Wednesday, March 9, 2005 at a time to be determined, to hold a business meeting to consider the nomination of Michael Jackson to be Deputy Secretary, Department of Homeland Security.

Mr. HATCH. Mr. President, I ask unanimous consent that the Committee on Indian Affairs be authorized to meet on Wednesday, March 9, 2005, at 9:30 a.m. in Room 485 of the Russell Senate Office Building to conduct a business meeting on S. 147, the Native Hawaiian Government Reorganization Act, and S. 536, a bill to make technical corrections to laws relating to Native Americans, and for other purposes, to be followed immediately by an oversight hearing on Indian Trust Reform.

Mr. HATCH. Mr. President, I ask unanimous consent that the Committee on Veterans' Affairs be authorized to meet during the session of the Senate on Wednesday, March 9, 2005, for a joint hearing with the House of Representatives' Committee on Veterans' Affairs, to hear the legislative presentation of the Veterans of Foreign Wars. The hearing will take place in room 216 of the Hart Senate Office Building at 10 a.m.

Mr. HATCH. Mr. President, I ask unanimous consent that the Select Committee on Intelligence be authorized to meet during the session of the Senate on March 9, 2005 at 3 p.m. to hold a closed briefing.

Mr. HATCH. Mr. President, I ask unanimous consent that the Subcommittee on Emerging Threats and Capabilities be authorized to meet during the session of the Senate on March 9, 2005, at 9:30 a.m., in open session to receive testimony on the Department of Defense Science and Technology Budget and Strategy.

Mr. HATCH

Mr. HATCH. I thank my colleague.

Mr. HATCH. Mr. President, I appreciate the remarks of my colleague. As usual, he has done a very good job in outlining what is involved in this bankruptcy bill, and I believe he deserves a lot of credit for the hard work he has done on the floor. Mr. President, comes now the Schumer amendment or, should I say, comes again the Schumer amendment. I rise to speak in opposition to this amendment. Been there. Done that. In fact, I have been there and done that a few times. I have been around here long enough to know a poison pill when I see one. And make no mistake about it, this has become a classic poison pill amendment. I have worked in good faith for several years to attempt to neutralize the counterproductive effects of this amendment. But no matter how we try to adjust the language, we cannot overcome the basic flaw in the amendment: The Schumer amendment is a solution in search of a problem. I oppose this amendment. It is no secret that I am genuinely fond of the senior Senator from New York. While I frequently disagree with him on issues, I respect enormously his political skills. Even when from my perspective he is wrong--such as the leadership role he has played in organizing the first permanent filibusters of majority-supported judicial nominations--I know that he always tries to act in a heartfelt manner that advances his political agenda. We have been able to achieve compromises on many issues over the years. Senator Schumer and I have worked together on many crime issues. For example, we have worked on language pertaining to the designation of high-intensity drug trafficking areas. Over a period of years we have tried to work together on the subject matter of the pending amendment to the bankruptcy bill. I have always been willing to work with him and others in the interest of passing the bankruptcy reform bill. From the beginning of this debate, many others and I have long contended that his amendment is unnecessary on its own merits. The amendment which we consider today appears to seek to guarantee the collection of civil and criminal penalties arising from criminal violations of the 1994 Freedom of Access to Clinic Entrances Act. The purpose of the Schumer amendment is to make clear that those who are fined due to attacks on abortion clinics are prevented from being able to discharge these fines and civil judgments resulting from such attacks through bankruptcy proceedings. My friend from New York has pushed a hot button. He must know that. Injecting the polarizing politics of abortion into the bankruptcy bill, most would have to agree, does not appear to be calculated to help the passage of the bankruptcy bill. Quite the opposite, the Schumer amendment has become a wedge issue that has stopped the bill in the past and, today, can threaten the passage of this important bipartisan bill that enjoys broad bicameral support. I urge my colleagues to vote against the Schumer amendment. Let me first explain my substantive objections and then I will describe my procedural, pragmatic, and political concerns with the Schumer amendment. At the outset, it should be understood that in its best light the Schumer amendment is a belts-and-suspender proposition that attempts to solve a problem which, as far as I can tell, has never actually occurred. We have been debating this bill for 8 years, and I am still unaware of any actual case in which a person who has been fined for harming a person or property in connection with any unlawful protests against, or attacks on, abortion clinics, has had any subsequent fines or financial penalties discharged through bankruptcy. At our markup of this legislation in February of 2001--more than 4 years ago, Senator Schumer said in justification of the amendment: . . . this is a vital amendment. I am not going into all the details . . . I will not catalogue them except to tell you that when Maria Vullo testified and anyone else did, they said without the Schumer Amendment we would go back to the days before 1994 when the clinics were closed by some who had felt . . . that they were more moral than the rest of us. . . . Certainly that prophesy has not come to pass in the 4 years subsequent to the time that Senator Schumer made that statement back in 2001. I am unaware of a systemic shutdown of the network of abortion clinics in this country over the past four years. Nor am I aware of any evidence of the use of the bankruptcy code as a mechanism of escaping financial responsibility for acts of violence against abortion clinics or their personnel, or for that matter, any other criminal enterprise. The reason for this outcome is simple: Current law prevents such an outcome. Section 523(a)(6) of the bankruptcy code already prohibits the discharge of debts through willful or malicious injury to a person or property, and section 523(a)(12) makes restitution orders resulting from a criminal conviction nondischargeable through bankruptcy. Nothing in this bill changes these provisions in the law. Moreover, a growing body of case law confirms the adequacy of these provisions when it comes to enforcing judgments arising from FACE Act violations. In Behn v. Buffalo GYN Womenservices, a 1999 decision in Federal bankruptcy court in Senator Schumer's home State, the court rejected an attempt to discharge a civil award debt resulting from an abortion protest. So it was rejected. In Bray v. Planned Parenthood of Columbia/Willamette, decided in 2000, a bankruptcy court in Maryland rejected the attempt to discharge debts resulting from an Oregon case in which a Web site produced by anti-abortion extremists threatened the lives of those working in these clinics. The 2001 Treshman decision in a Maryland bankruptcy court confirmed that such actions will not be tolerated by permitting discharge of restitution or judgment through bankruptcy. Randall Terry, the founder of Operation Rescue, is living proof of the adequacy of these laws. His Web site now solicits contributions after he was completely bankrupted as a result of actions found to be violative of the FACE Act. From a purely legal perspective, it seems fair to say that what we have here is a solution in search of a problem. This is actually confirmed by the most recent testimony of my colleague from New York's star witness on this subject, Maria Vullo. Way back when this amendment was first suggested back in 1998 or 1999, several cases were still pending. But now these cases have been resolved. And in every instance, the courts have refused a discharge of these debts. In answer to a question of Chairman Specter in connection with the Judiciary Committee's last hearing on bankruptcy reform, held only 3 weeks ago, Ms. Maria Vullo acknowledged that she was ultimately successful under current law in all six bankruptcy courts where she acted to help prevent such improper bankruptcy discharges of abortion clinic-related fines. There you have it. The primary litigator in these cases testified that she has won in all of her cases under existing law. This should help lead us to the conclusion that there is no compelling legal reason to change the law. There is an old saying: If it ain't broke, don't fix it. We are not talking just belts and suspenders, we are talking belts, suspenders, and an elastic waist band. Discharges related to FACE Act violations have not been permitted under current law. Our laws are clear. We discourage, prevent, and punish abusive filings, including those related to those offenses that occur in connection with abortion clinics. Again, to my knowledge, there is a complete absence of cases demonstrating the problem that this amendment seeks to address. This is not surprising. Our bankruptcy laws already act to prevent, have prevented, and will act in the future to prevent precisely the problem that Senator Schumer is worried about, but cannot, it appears, document. The truth of the matter is that, on the merits, this is just an unnecessary amendment. Yet this amendment has already scuttled bankruptcy reform on two occasions. In 2000 essentially the same bankruptcy bill passed this body with 83 votes and then 70 votes. It was vetoed by President Clinton in the waning days of his second term for failing to include this amendment. Then in the 107th Congress, the House of Representatives rejected even a twice-amended--and moderated--Schumer amendment. Now that it is clear that the courts will not discharge these debts, the proponents of this amendment have slightly but subtly changed their tune. Now the alleged issue of concern is that some will nevertheless continue to attempt to discharge such fines and penalties--that is, sometime, some place, someone will try to use the bankruptcy code to shield illicit acts involving attacks on abortion clinics. Some argue the amendment is justified on the supposed need to codify the general prohibition of section 523(a)(6) against discharging debts accrued in connection with willful or malicious injury to a person or property with a special provision of law geared solely toward abortion clinic- related violence. The fact is, however, current bankruptcy law, along with the ever growing body of precedents on this subject, make it clear that attorneys will not be inclined to make these frivolous and abusive filings in the future. Rule 9011 of the Federal Rules of Bankruptcy Procedure already allows sanctions against attorneys who participate in submissions to delay proceedings and needlessly increase the cost of litigation. It says a frivolous action without evidentiary support can be punished. I guess it is true that particular bankruptcy courts may sometime in the future eventually be faced with a filing by someone asking for improper discharge of debts, but that is just the nature of litigation within the bankruptcy system and the American system of justice. Having the right to bring a claim in our system is very different from winning that claim. For each case that goes to trial, there is a winner and a loser. Trying to get around the bankruptcy code and case law precedents in the manner feared by supporters of the Schumer amendment is a losing case under current law. Courts decide cases on the basis of the law and the particular facts in front of them. That bankruptcy courts will have to undertake their normal and traditional role of reviewing all relevant aspects of individual filings that may, or may not, include these improper and unsustainable claims related to abortion clinic damages is hardly a grave injustice. And for what it is worth, the success of the FACE Act and the decisions of bankruptcy courts that hold those debtors to account appears to have resulted in an ever dwindling number of judgments that must be litigated. This is an issue that is being overhyped. The current statutes are clear. The case law is clear. The paucity of evidence of such claims for abortion clinic-related violence and injuries being routinely, or even infrequently, made in bankruptcy proceedings, reflects the fact that the word is out that the statutes and case law already prevent the problem that the Schumer amendment allegedly solves. Moreover, I would like to add that section 319 of this bill expresses the sense of the Senate that all signed and unsigned documents submitted to a bankruptcy court must be preceded by a reasonable inquiry to verify that this information is well grounded in fact and warranted by existing law or based on a good faith argument for an extension, modification, or reversal of existing law. I am hopeful that this sense-of-the-Senate provision will help spread the word even further. When the Schumer amendment burst upon the floor in 2000, I worked in good faith to make this questionably meritorious issue more palatable to Members on my side of the aisle. In particular, I wanted to help alleviate the concerns of those who, as I, hold strong pro-life views. We are sensitive to the fact that the original Schumer amendment could reasonably be interpreted as affecting first amendment rights to protest against what we believe is the unjustifiable practice of abortion. It is my recollection that the original Schumer language back in 2000 also addressed attempted or alleged harassment, interference, and obstruction. Many believed that this language was way too broad and could have potentially implicated the actions of peaceful anti-abortion protestors who were simply exercising their freedom of speech. Nevertheless, for a variety of reasons, mostly political rather than legal or policy, the Schumer amendment was accepted. One of the key factors was that it appeared to some at the time that the amendment was offered in part to give then-Vice President Gore an opportunity to possibly cast a tie breaking abortion vote during the Presidential election year of 2000. I cannot say for certain that this was the case. But if it was, it probably would not have been the first time that Presidential politics played out on the floor of the Senate. Before the February 2, 2000, vote on the Schumer amendment, I said the following on the Senate floor: Although I believe this amendment to be tremendously flawed, the majority leader, Senator Grassley, and I recommend that Members on both sides vote for this amendment. We will, in good faith, in conference correct the amendment and resolve these problems at that time. With this amendment accepted, nobody will be able to demagogue this issue politically in the context of true bankruptcy reform. We pledge to work with our friends on both sides of the aisle who are interested in this issue during conference to make sure the law is clear, that the due respect for the first amendment, and debts arising from violent acts cannot be discharged in bankruptcy. This is hardly a ringing endorsement and certainly nothing near an absolute commitment to retain this language at any cost or contingency. Nevertheless, in the 106th Congress the bankruptcy bill, with this flawed language, passed the Senate with 83 votes. Eventually during the House-Senate conference committee the Schumer abortion clinic-specific amendment was not contained in the conference report. The bankruptcy legislation, without the Schumer language still passed the Senate with a strong bipartisan 70 votes. Unfortunately, President Clinton then pocket vetoed the bill passed by both the House and Senate. Early in the 107th Congress, I worked with Senator Schumer on compromise language that moved away from the incendiary abortion clinics-specific language to a more general and neutrally-phrased provision related to ``lawful good and services.'' This provision was adopted by a unanimous voice vote of the Judiciary Committee on February 28, 2001. I would note for the record that despite this compromise, Senator Schumer voted against the bill on final approval in the Judiciary Committee. On July 17 , 2001, this bill passed the Senate by a vote of 82-16. The House-passed version of the bankruptcy bill in the 107th Congress once again did not contain comparable language. I might add that the House passed its bill by a strong bipartisan vote of 306-108 on February 26, 2001. At this point Senator Schumer and I worked with Representatives Henry Hyde and John Conyers and others to fashion an acceptable compromise. This compromise was rejected. Frankly, at the time, I would have preferred that the compromise be accepted and this already overdue bill be signed into law. However, I can well understand the frustration of many of my colleagues in the House being asked to adopt a watered-down version of an amendment without meaningful legal effect derived from the inflammatory original version of the Schumer amendment that addresses a problem that apparently does not exist in the first place. Rather than go down this fruitless road again, I ask my colleagues to vote down the Schumer amendment for once and all. Not only is it unlikely that the House will accept it, the Senate should not accept it either. One important difference from the situation of 3 and 4 years ago is that we now have, as I discussed earlier, a more definitive picture of how the courts will interpret the application of section 523(a)(6) in the context of abortion-clinic related claims. In short, the courts have not and will not allow fines or judgments stemming from the willful or malicious injury to a person or property to be discharged in bankruptcy whether they arise out of illicit actions against abortion clinics that violate the FACE Act, or, for that matter, any other of the literally dozens of other injuries that can be conjured up relating to willful or malicious injury to a person or property. No one would, or should, take seriously any amendment that purported to state explicitly that fines or judgments incurred from yelling fire in a crowded theater could not be discharged through bankruptcy. Nor should we support the Schumer amendment when we know it is both unnecessary and divisive. You do not have to be pro-life to be against the Schumer amendment. You just have to conclude that 8 years is enough time to have worked on one bill that has repeatedly engendered broad bipartisan support. And to hold up this legislation once again over an incendiary, extraneous, redundant poison pill amendment is just not right. I always try to seek a compromise or accommodation with my colleagues whenever it is productive to do so and consistent with my principles. In this case it is simply not possible to do so in a productive manner absent any sign from the House that its Members are receptive to such a compromise. Having worked on this issue for several years, I have reached the conclusion that the inherent volatility of the subject matter of the original Schumer amendment has made it nearly impossible to arrive at a neutral language resolution to this undocumented problem at this time. Moreover, the well-known by now impasse over the acceptability of compromise language is compounded by the simple fact that there is, to my knowledge, no compelling evidence that there is a problem requiring a legislative fix. To a certain extent, this is an exercise that demonstrates why it can be harder to fix a hypothetical problem than a real problem. Frankly, that we would even be considering an amendment based on the 2001 Judiciary Committee markup language, rather than the revised 2001 conference report language, hardly seems like a step in the right direction. To use an expression that my friend from New York sometimes uses himself, reverting to the earlier language may seem to some a bit like a poke in the eye. I suspect that this is unintentional on the part of my friend from New York. I wish we could have worked this out, and I thought we did work it out. But as I look at all the facts and circumstances, including the developments in the actual cases brought and decided over the last few years, I can only conclude that there is even stronger evidence today than there was in 2000 and 2001 that this amendment is simply unnecessary. While I attempted in good faith to resolve this problem 4 years ago, time seems to have proven that those I who looked askance at this compromise in the first place were correct in their assessment of the lack of necessity for this amendment. I ask my colleagues to oppose the amendment of my distinguished friend from New York for these reasons. It is important that we get this bankruptcy bill finished. It is extremely important that we get it done. If this amendment is added, it isn't going to get done again, and we will be in the ninth year next year, frankly, probably 2 years from now because we will never get what really has to be done in the best interests of bankruptcy reform.

Mr. HATCH. Mr. President, in a few hours we will be voting on cloture for this bill. I would just like to take a minute or two and remind everyone why it is time to end the debate on this bill. It has been 8 long years of consideration on this legislation. We have all compromised a great deal. Not everyone got their preferred language or amendments. Not everyone is happy with the current legislation. But I think everyone would have to agree that we have given thoughtful consideration and fair opportunity to all suggestions on the bill throughout the years of debate. Over the years, we modified the homestead exemption. We modified the means test. We provided for sanctioning attorneys who file abusive claims. And we hindered creditors who would try to collect through predatory lending practices. All of these changes, among scores of others, came from my Democratic colleagues. After all this, just 2 weeks ago, we took 5 more Democratic amendments in the Judiciary Committee markup. And yet almost everyone of the pending amendments today touches upon the areas where we have previously compromised. At a certain point, the time comes to move forward with what we have. Given how far we have come on this bill already over the last 8 years, and considering all the compromises that have been made, we may get no bankruptcy bill at all if we try to take more amendments. The lopsided votes in favor of this bill in the past--with 70, 83, and even 97 votes in this Chamber--reveal that we are left with only a small minority of opposition. The fact is that a large majority of this body recognizes that we are not doing anything radical in this bill. We simply ask that higher-income filers who can pay their bills, should pay their bills. It is as simple as that. There is no reason to ask the vast majority of bill-paying consumers to pickup the tab when those with means do not repay their obligations. After 8 long years, we have compromised every which way we can. The remaining amendments being proposed are just further adjustments of adjustments to adjustments that were already made during this process. There is simply no reason to continue to holdup this bill through the amendment process. The longer we delay, the greater the chances for mischief. The more we stall this measure, the more likely we open it to political, message amendments that can only act to stall work on this bill. A time comes when you just have to say enough is enough. Eight years should be long enough to pass one bill. I urge my colleagues to join me in voting for cloture.

Mr. HATCH

Mr. HATCH. Mr. President, today the Senate will consider two minimum wage amendments to the bankruptcy reform bill, S. 256. Senator Ted Kennedy's minimum wage amendment proposes to increase the minimum wage by $2.10 per hour in three steps over 26 months, and Senator Rick Santorum's amendment would raise the minimum wage by $1.10 an hour over 18 months. I have always believed that increasing the minimum wage is not an effective way to improve living standards for the Nation's working poor. Simply put, raising the minimum wage is a Federal government mandate which creates negative ripples throughout the national economy by making goods and services more expensive for families. Raising the minimum wage closes the doors of many small businesses, and forces companies to move jobs offshore to less costly countries. Such an increase makes it more difficult for many lower skilled U.S. workers to get started in the job market. Small businesses are the engine for economic growth in America and represent a powerful vehicle for opportunity. A minimum wage increase would negatively affect small businesses across the nation and in my home State of Utah. For example, Wangsgard's grocery store of Ogden, UT, offers a full line of groceries, along with a meat shop, oven-fresh bakery, fresh produce, a deli and snack bar, coffee counter, garden center and Ace Hardware. Without a doubt, this store really is a one-stop solution. Phillip Child, president and owner of Wangsgard's grocery store, informs me that a minimum wage increase would force him to reduce jobs. In fact, Mr. Child confirms that of his 93 employees, those who are earning minimum wage are either in high school or living at home with their parents. These employees are not supporting families. With the goal to open a second Wangsgard's grocery store in the near future, Mr. Child is concerned that an increase in minimum wage would certainly cut the number of new jobs available to the community. I believe education and job-training programs are the key to raising take-home pay. Of course, it's much easier to pose as the champion of the poor and worry about the consequences later. Yet if Congress does move to increase the minimum wage, it should adopt a small, more gradual increase, and offset the negative consequences of a wage hike with measures to protect the small businesses that generate a majority of all new jobs and employ most Americans. That is why I support the Santorum amendment and oppose the Kennedy amendment.

Mr. HATCH

Mr. HATCH. Mr. President, let me just say a few words about why this amendment is not a good amendment and one that should be voted down. This would cap the interest rate for consumer credit extensions at 30 percent in this country, and, frankly, would preempt many States' usury laws unless the State has a lower interest rate. In other words, preemption of State laws is something we sought to avoid in this bill. We have refused to do so in the homestead provisions, so there is no reason to touch the State usury laws as well. There is no dispute that lending agencies are already heavily regulated. We have already restricted usury rates on first-lien loans. Additionally, special usury provisions in the National Bank Act and Federal Deposit Act preempt State usury laws for national State banks. We did not preempt these State laws haphazardly as we would do today by passing the Dayton amendment. I believe we should stick with the bill as written. We have taken this into consideration. We have worked long and hard over 8 years to get this right. And, frankly, I think this amendment is an inappropriate amendment and should be voted down. I hope our colleagues will vote it down. I yield the remainder of our time. Mr. President, I ask for the yeas and nays.

Mr. HATCH. Mr. President, I rise in opposition to the Nelson amendment, although I commend the Senator from Florida in his work on this issue of identity theft. This amendment is written so broadly, it actually invites fraud despite its well-intentioned purposes. I understand there will be several hearings on the issue of identity theft, and I look forward to working with my friend from Florida and my other colleagues to find a solution. But for now, this is written so broadly that I think it actually invites fraud. I hope my colleagues will oppose the amendment because it would cause a lot of difficulty on this bill.

Mr. HATCH. I am happy to yield.

Mr. HATCH. I do. But it is written so broadly that anybody who claims they have been defrauded, whether they have or have not, qualifies under your amendment. That is way too broad under this bill. I am happy to work with the distinguished Senator, and we will see what we can do later in this Congress. I hope everybody will vote down this amendment.

Mr. HATCH. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. HATCH. Mr. President, this amendment would provide a nearly fourfold increase in claim amounts and strike the time period. That means it would be much harder to confirm a plan under Chapter 11. It will cost us jobs, because the debtor companies would not be able to survive the bankruptcy process. My colleague from the Finance Committee is concerned about the co- provisions. Rest assured, they are bad. We all know how many compromises have been made on this bill. This amendment would undo years of hard work. I urge my colleagues to vote no on this amendment. I yield the remainder of my time.

Mr. HATCH. I ask for the yeas and nays.