Ted Kennedy

Mr. KENNEDY

Mr. KENNEDY. Mr. President, how much time remains?

Mr. KENNEDY. I ask the Chair to let me know when I have used 7 minutes. Mr. President, we have had a good discussion with my friend and colleague, the Senator from Pennsylvania. During the course of the debate, I did mention that a range of different groups are supporting our position. I will include those endorsements in the Record. One I would like to mention is from the Catholic Bishops. This is their position: The Catholic Bishops have been long time supporters of the minimum wage. In Catholic teaching, the principle of a living wage is integral to our understanding of human work. Wages must be adequate for workers to provide for themselves and their families in dignity. Because the minimum wage is not a living wage, the Catholic Bishops have supported increasing the minimum wage over the decades. We are aware that some accommodations are being offered to alleviate possible adverse effects on small businesses . . . that might occur with a modest increase in the minimum wage. However, other changes and modification being contemplated that will affect overtime pay or the 40 hour workweek are unwarranted and unwise. Other workers should not lose minimum wage protection or overtime pay as the price of increasing the wages of America's lowest paid workers. At the very least, such changes to the Fair Labor Standards Act should be considered in the formal legislative process, not attached to a popular increase in the minimum wage as a condition of passage. They indicate their support for our amendment. In just a few moments the Senate will have an opportunity to vote either in favor of the Santorum amendment or my amendment. I believe a vote for the Santorum amendment is a vote to deny the minimum wage to more than 10 million workers. Those workers are looking to us for a fair raise to reward their hard work and to help care for their families. But the Santorum amendment takes away their minimum wage rights entirely. A vote for the Santorum amendment is a vote to deny overtime pay to more than 10 million workers. These workers rely on overtime pay to make ends meet, and overtime pay is compensation for many long hours away from their families. A vote for the Santorum amendment is a vote for a pay cut for workers who rely on tips--waitresses, taxi drivers, and hairdressers. This is contrary to our values as Americans. We believe that work should have a reward. The Santorum amendment dishonors that. It is an insult to the low-wage workers of this country. The amendment I offer is about everything that we stand for as a nation. It is about opportunity. It ensures that every American at least has the opportunity to move up and achieve the American dream. It is about fairness. What is fair about working hard 52 weeks of the year and still living in poverty? What is fair when Members of Congress raise their own salaries seven times, by $28,000, over the last 8 years and refuse to vote for an increase in the minimum wage? What is fair about that? What is fair about executives who pay themselves millions of dollars but can't find a way to pay a decent minimum wage? It is about making our economy work for everyone, not just the privileged few. There is no doubt that this is one of the central moral questions of our time. It is how we treat the least of those among us. It is why religious leaders have supported a minimum wage increase. The Santorum amendment fails the fundamental obligations of a just and fair society. Under the guise of raising the minimum wage, it cuts overtime pay and leaves out too many individuals. Who are these minimum wage workers? First of all, they are men and women of dignity. They assist in the classrooms every day to teach the children. They work in nursing homes to help care for the elderly who have sacrificed for their children and have made such a difference for this country. This issue is about women working in our society, because a majority of those who will benefit from this minimum wage increase are women. It is a women's issue. It is a children's issue because a third of those women have children. It is a children's and a women's issue--and a family issue. It is a civil rights issue because so many of the men and women who receive the minimum wage are men and women of color. And most of all, it is a fairness issue. If there is a value which the American people understand, it is fairness. The American people believe if you work 40 hours a week, 52 weeks of the year, you should not have to live in poverty. They are living in poverty today with the second lowest minimum wage in nearly the last 60 years. The amendment I offer will provide a helping hand to men and women of dignity to live in a decent and fair respect. I hope the Senate will accept it. I yield back my time and ask for the yeas and nays.

Mr. KENNEDY

Mr. KENNEDY. Mr. President, I send an amendment to the desk.

Mr. KENNEDY. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

Mr. KENNEDY. Mr. President, this amendment will increase the minimum wage from $5.15 an hour to $7.25 an hour over roughly a 2-year period. My friend from Pennsylvania, Senator Santorum, will offer his own minimum wage amendment, and he will do so later on in the afternoon. We intend to debate this and vote on it, subject to the agreements of the leaders, probably late Monday afternoon, and we will take the opportunity during Monday afternoon to get into greater details. Both Senator Santorum and I have agreed that we would each make a brief presentation on this item at this time. We have not seen an increase in the minimum wage for 8 years. At the present time, the minimum wage has fallen to the second lowest level in the last 45 years. Since 1938, the minimum wage has been increased on eight different occasions. On most of those occasions it has been with bipartisan support. Republicans have recognized that we ought to treat people fairly and decently, and those at the lower level of the economic ladder ought to be able to have a livable wage. President Eisenhower felt that way, President Ford felt that way, and the first President Bush felt that way. We are asking the Senate to join us in going back to having the minimum wage at least increase to a reasonable level. Now, who are the minimum wage earners? The minimum wage earners are men and women of dignity. Even though they get paid at a minimum wage, they work hard, they take a sense of pride in what they achieve, and they do a hard day's work. More often than not, they not only have one job, but they have two jobs and sometimes even three jobs. What sort of jobs do the minimum wage workers have? First, many of them are teachers' aides in our school systems, working with the young students of America. Many others are working in our nursing homes, looking after the parents who were part of the ``greatest generation,'' men and women who sacrificed for their own children, men and women who brought this country through the Great Depression. These are men and women of dignity who take a sense of pride in their work. Beyond that, who are they? This is basically a women's issue because the great majority of the millions of people who would benefit from this minimum wage increase are women. It is a children's issue because a one-third of those women have children. So it is a women's issue and it is a children's issue. It is also a civil rights issue because many who earn the minimum wage are men and women of color. So it is a family issue, a women's issue, a children's issue, a civil rights issue, and, most of all, it is a fairness issue. Americans understand fairness. What they understand is anyone who will work 40 hours a week, 52 weeks of the year, should not have to live in poverty in the United States of America. That is what this issue is all about. That is what the vote will be on, on Monday next, whether we are going to say to millions of our fellow citizens that they will not have to live in poverty, although they will still be earning below the poverty rate. What the amendment will do is the following. It is the equivalent of 2 years of childcare. It will provide full tuition for a child in a community college, or a year-and-a-half of heat and electricity, or more than a year of groceries, or more than 9 months of rent. This might not sound like very much to the Members of this body who have seen their pay increase seven times since we have last increased the minimum wage. But we ought to be able to say here and now that we will join the traditions of an Eisenhower, a Ford, and the first President Bush, Democrat and Republican Presidents alike, and say those working Americans who work at some of toughest and most difficult jobs, men and women of pride and dignity, ought to be paid a fair wage. That is what this amendment is about. We look forward to a further debate when we have the opportunity to do so on Monday next.

Mr. KENNEDY. Will the Senator yield?

Mr. KENNEDY. One of the concerns many of us had in this bill is the interest of fairness. I think fairness ought to be standard for any piece of legislation. As it is currently before us, we will have those who will be able, with their homestead exemption, to preserve homesteads valued at millions and millions of dollars and, on the other side, individuals will lose completely all of their savings because they will lose their homes. There is no fairness there. The Senator from New York is pointing out in another area the issue of fairness. Those who have resources and have wealth and have the contacts will be able to shelter their resources while basically middle-income working families, the working poor who are trying to get by and have seen an explosion of different costs, on housing, on health care, on tuition, will be buried. This will be another dramatic example where those who have it will be able to preserve it and those who have been struggling will lose it.

Mr. KENNEDY. I will ask a final question. A third of all the bankruptcies are among those who are earning below the poverty line. Does the Senator think they will be able to take advantage of this loophole?

Mr. KENNEDY. Will the Senator yield for a question on that part?

Mr. KENNEDY. I offered the amendment on the TANF bill last year and the bill was pulled because it was offered as an amendment. So that is part of our frustration.

Mr. KENNEDY. Mr. President, this legislation that we have before us cracks down unfairly on large numbers of hard-working families that are in dire financial straits because of a sudden serious illness or because their loved ones are fighting in Iraq. Yet, this bill blatantly ignores the real abuses in our bankruptcy laws: the corporate abuses that have become epidemic in recent years. It is the worst corporate misconduct since before the Great Depression. Some of these companies were brought down by outright criminal activities. Many more of them were driven into bankruptcy by the greed and mismanagement of a small group of reckless insiders who ignored their responsibility to their employees and their stockholders alike. Current law on corporate bankruptcy is grossly inadequate in dealing with these problems. Often, the very insiders whose misconduct brought the company down do very well in bankruptcy. The people who suffer the most are the innocent victims, the employees, the retirees. Increasingly, the bankruptcy court has become a place where corporate executives go to get permission to line their own pockets and break their promise to their workers and retirees. That kind of abuse is terribly wrong, and it is our responsibility to prevent it. Instead, we are considering a 500-page bankruptcy bill that virtually ignores this issue. It does nothing to address the corporate looting by high-level insiders. It does nothing to protect a company's workforce from losing their jobs, their health care, and their pensions. This bill should not move forward until those glaring omissions are corrected, and the Durbin amendment is the way to do it. Take a close look at the examples of executives in some of America's largest corporations, and see how lavishly they benefitted while their companies went into bankruptcy. Top executives made sure they were well provided for at the company's expense. Yet, loyal employees and their families were left to struggle on their own. A major corporation in Massachusetts, Polaroid, filed for bankruptcy in 2001. In the months leading up to the company's filing, $1.7 million in incentive payments were made to its chief executive officer on top of his $840,000 salary. The company also received the approval of the bankruptcy court to make $1.5 million in payments to senior managers to keep them on board. And these managers collectively received an additional $3 million when the company's assets were sold. Yet, just days before Polaroid filed for bankruptcy, it canceled the health and life insurance benefits for more than 6,000 retirees. It also canceled the health insurance coverage for workers with long-term disabilities, and halted the severance benefits for thousands of workers who had recently been laid off. Polaroid employees had been required to contribute to the company's Employee Stock Ownership Plan. When the company failed, their retirement savings were virtually all wiped out. The loss was devastating for workers like Karl Farmer, a Polaroid engineer in Massachusetts for more than 30 years. He had been required, as had other Polaroid employees, to pay 8 percent of his pay into the company's Employee Stock Ownership Plan. At its peak, this stock was worth over $200,000. But after the company declared bankruptcy, the stock was worthless. And he also lost his severance pay and medical benefits. Or take Betty Moss of Smryna, GA. Betty and her husband retired and were traveling across the country in their camper when they learned that Polaroid had stopped her severance pay and that they had lost her health insurance and life insurance. Because of the fall in Polaroid stock, her retirement savings plunged from $160,000 to only a few hundred dollars. The loss of health insurance and life insurance benefits was particularly devastating for long-term disabled workers. With their disabilities, they cannot go back to work, and they have no way to obtain other insurance coverage. Sally Ferrari of Saugus, MA, was diagnosed with Alzheimer's disease after working for Polaroid for 20 years. In recent years, she required round-the-clock care. Yet, Polaroid cut off her health care benefits in bankruptcy, which meant that her husband had to stay at work full time until he recently passed away in order to provide medical coverage for his wife. I also have letters from other employees. This letter is from David Maniscalco. He was injured while working for Polaroid. Now he is unable to work, and his medical bills are consuming his family's savings and his retirement because Polaroid took away total health care coverage. He points out: After Polaroid declared bankruptcy, they terminated all the people on long term disability, and terminated all of our Medical, Life and Dental Insurance. I wear a fiberglass back brace and sleep in a hospital bed and am not able to work. My wife changed jobs in order to have medical insurance for herself. And I am on Medicare and a secondary insurance. The cost to us is $895.00 a month for medical insurance alone. The problem is, we're using our retirement money to help with the cost of our medical insurance. Here you have the corporate officials well taken care of, and the loyal employees were notified with less than 24 hours. And this is how they end up. How? Because they go to bankruptcy court. Does this bill do anything about protecting those individuals? Absolutely zero. Absolutely nothing. Absolutely nothing. We have here a letter from Elaine Johnson. She lost a lung to cancer. When Polaroid went into bankruptcy, she lost her health insurance, too. She writes: When Polaroid declared bankruptcy, I lost my life insurance, medical and dental insurance. Because of my disability, I'm unable to get other insurance and another job. Once you have these serious illnesses, it is virtually impossible to ever get your health insurance again. I have a son who had osteosarcoma at 12 years old. He, as an individual--he is 43 years old--cannot get a health insurance policy today no matter what he is prepared to pay for it, unless he goes into some kind of group. Why? Because he had cancer at one particular time. Here you have individuals who have disabilities who are tied into their company's program. The company has made a commitment to them. And then what happens? At the time they go into bankruptcy court, one of the first things that happens is the corporate officials free themselves from the obligations to pay the employees' health insurance, and they are left out in the cold. The list goes on. Polaroid employees, like Betsy Williams of Waltham, MA, were financially devastated by the loss of medical and health care benefits. Betsy was with Polaroid for 28 years, and she thought, when she came down with lupus, her company's disability, health and life insurance would cover her. She writes: When I received an unsigned letter from Polaroid Corporation in July of 2002 stating that I (along with other employees on Long Term Disability) would be terminated by the company and my medical, dental and life insurance benefits would end, I was shocked and dismayed. Unable to work because of my disabilities, my husband (who is also disabled) and I are forced to pay approximately $1,125/month for a Medicare Health plan and an additional $400-$500/month for prescription co-payments, supplies, etc.; no available dental plan, and I was only able to get 50% of my life insurance at an exorbitant rate. We now have two mortgages; our groceries are bought with a credit card; and we are holding on financially by a thread. There it is. That is the person who is going to get burned with this bill. That is the person who is going to be marched in. That is the person who is going to be required to pay $10, $15, $20 a week, $80 a month on into the future under this bill. But do we do anything about the corporate executives? Absolutely nothing. And the list goes on. These are hard-working people who were crushed when Polaroid cut their benefits. Yet, while they suffered, Polaroid executives filled their pockets to overflowing. When the chief financial officer left, she got a $600,000 pension. Recently, she received $1 million in severance pay from Royal Dutch/ Shell Company, even though she left under a cloud of scandal. And Polaroid's former president is now the president and CEO of one of the country's largest staff outsourcing companies. He plans to take the company public soon and will reap enormous profits. Enron, as my friend and colleague, the Senator from Illinois, pointed out, is another flagrant example of massive company looting while employees lost everything. Enron executives cashed out more than $1 billion of company stock when they knew the company was in trouble. And just before the company declared bankruptcy, its top executives were paid bonuses as high as $5 million each to stay on. Enron workers, however, were forced to hold their company stock until the age of 50. They were subject to blackout periods that executives were not. They lost a total of $1 billion in retirement savings. Thousands of them lost their jobs. Thousands lost their health insurance. Thousands of them will be dragged into bankruptcy court under this particular legislation. Yet we have WorldCom, another shameful case. Bernie Ebbers is on trial for corporate fraud. I don't know how many Americans read the newspapers yesterday, but Bernie Ebbers is on trial. He received millions of dollars in personal loans from the company and was originally granted a pension worth $1.5 million a year. This week he denied knowing anything about the biggest accounting fraud in history. ``I don't know about technology. I don't know about financing. I don't know about accounting,'' he claimed. What about those people I just mentioned who worked for Polaroid all their lives and because of the bankruptcy lost their health insurance, do you think they will be able to give those kinds of answers? Not under this bill. Ordinary Americans will not have this defense when they are facing bankruptcy. Countless WorldCom employees who honestly knew nothing about the fraud wound up losing their jobs and their retirement. Another example is the popular retailer Kmart. As Kmart was teetering on the edge of bankruptcy, the company bought two new corporate jets. Once it finally went into bankruptcy, CEO Chuck Conaway was given a $9 million golden parachute. Meanwhile 57,000 Kmart workers lost their jobs, and the company closed 600 stores. Abuses like these have made the headlines, but this bankruptcy bill doesn't deal with them. It comes down hard on those families who have critical health bills, families who are touched by cancer and heart and stroke, families who have children with disabilities. It comes down hard on those individuals and lets these people off free. And we call that fair? Take away their homes if they live in 40-odd States, but let them keep millionaire homes in Texas and Florida. And they do nothing about it, the proponents of this bill, nothing. Call that fair? Call this bill fair? We know what it is. It is making the various bankruptcy courts the collection agencies for the credit card companies. Mr. American Taxpayer, you are going to be paying for more bankruptcy judges and staff and buildings because there are going to be so many more people who are going to be thrown into bankruptcy. The fastest growing group of bankruptcy filers is the elderly, individuals fifty-five and older, who are being hit with increased medical costs. As I mentioned the other day, they are seeing increased premiums on Medicare--wait until they get their new prescription drug program and start paying the costs for that, which is an inadequate program that has special provisions in it that have giveaways to the HMOs and to the prescription drug companies. They are just going to end up paying more and more, Mr. American Taxpayer, to support these courts of bankruptcy, and they are going to squeeze our fellow citizens out all the more. Meanwhile other people are getting $9 million golden parachutes. Senator Durbin's amendment will stop the travesty of high-level corporate insiders walking away with millions of dollars in bankruptcy while workers and retirees are left emptyhanded. This amendment will strengthen the ability of bankruptcy courts to invalidate fraudulent transfers by corporate insiders. The current legislation does zero, nothing. The proponents of this legislation have opposed this effort by the Senator from Illinois. This amendment will strengthen the ability of bankruptcy courts to invalidate fraudulent transfers. Currently the court can only compel the return of money improperly taken out of the company in the preceding year. In many instances the looting has taken place over a number of years, and the court has no authority to go after those lost assets. This amendment will allow bankruptcy judges to reach back as far as 4 years to recover corporate assets. It also empowers the court to review and set aside the excess benefit transfers made to corporate management while the company was insolvent or which contributed to the company's insolvency. These sweetheart deals often take the form of huge bonuses, golden parachutes, and other payments to corporate executives before the public learns that the company is in trouble. Such payments violate the most basic principle of fiduciary duty, and the bankruptcy court should have the power to correct these wrongs. Every dollar recovered from these outrageous inside deals is another dollar that will be there to compensate workers, retirees, and other creditors. Finally, our amendment--I welcome the opportunity to cosponsor it with the Senator from Illinois--will give a priority claim in bankruptcy to employees who are forced to invest their retirement savings in employer stock. Polaroid workers lost their retirement because they were required to invest 8 percent of their pay in their company as a condition of holding their jobs. Workers at Enron were also forced to keep their company stock until the age of 50 and subject to blackout periods during which they couldn't sell their stock, but the company executives could. Under current bankruptcy law, workers have no way to recover from these losses. They deserve a chance to recover some of what they lost. This amendment will provide it. The issue is simple fairness. We learned even yesterday about the new loophole, about trusts that are going to be created so those individuals who may go into bankruptcy and who have resources can go out and hire a lawyer and shelter their income from any kind of bankruptcy court. But the average worker can't do that. The average worker out there working a lifetime for a company and then dismissed, the company then goes into bankruptcy, can't do that. They can't hold onto their homes like so many of the wealthiest individuals in our country. In Florida they will be able to do it, but they won't be able to do it in most of the other States. In Texas they can do it, but not in most of the other States. Yet here on the floor of the U.S. Senate, the Senate refused, absolutely refused to show any consideration to home ownership for people who have worked hard all of their lives, just having $150,000 in equity. This issue is about fairness. If a corporation has gone into bankruptcy, those who ran the ship aground certainly should be not be enriched at the very time those who depend on the company for their livelihood are driven into poverty. Yet that is what happens all too often in corporate bankruptcy today. Any bankruptcy bill which fails to address these critical issues is a cruel hoax on the American people. I urge my colleagues to support the Durbin amendment, recognizing that bankruptcy reform has to apply to corporations, too. I yield the floor and suggest the absence of a quorum.

Mr. KENNEDY. Mr. President, the most disturbing thing about this supposed ``bankruptcy reform'' is the utter lack of fairness and balance in the legislation. It gets tough on working families who are facing financial hardship due to a health crisis, a job loss caused by a plant closing, or a military call up to active duty. The laws of bankruptcy are being changed to wrest every last dollar out of these unfortunate families in order to further enrich the credit card companies. However, the authors of this legislation look the other way when it comes. to closing millionaire's loopholes and ending corporate abuse. The bill fails to deal effectively with the unlimited homestead exemptions in a few States which allow the rich to hold on to their multi-million dollar mansions while middle class families in other States lose their modest homes. And, the bill totally fails to address the shocking abuse of millionaires hiding their assets in so-called ``asset protection trusts,'' placing them completely beyond the reach of creditors. They can hold on to their wealth merely by signing a paper placing title their bank accounts, stocks, bonds, and other holdings in the name of a trust. The wealthy debtors don't even have to change their residences or put all of their money into a country estate in Florida or Texas. All they need to do is file a trust document in one of the five States that allow this subterfuge. They do not have to relinquish control over their property and it can continue to be used to support their extravagant lifestyle. Unfortunately, average families facing bankruptcy don't have large bank accounts and stock portfolios so they cannot take advantage of this loophole. Most couldn't even afford to hire a lawyer to set up the trust. However, that's all right because the asset protection trust scam was not designed for them. It was designed to protect millionaire deadbeats, people who ran their companies into the ground leaving their creditors and their former employees holding the bag. It was designed to protect those who took the money and ran. Somehow the authors of this bill, after eight years of studying the bankruptcy code in search of ways to tighten the law so that more people would be held accountable for their debts--somehow they overlooked this loophole. I wonder how they could have missed this one. I guess they were just too busy finding ways to make working families pay a few more dollars to the credit card companies. Fortunately, the New York Times did expose this outrageous loophole and Senator Schumer has offered an amendment to close it. It will empower the bankruptcy court to reach out and pull the assets in these abusive trusts back into the bankruptcy, using those assets to help pay creditors. The vote on this amendment will be a real test of the sincerity of those who say their goal is to hold debtors more accountable for the money they owe. I would hope that same desire to enforce personal responsibility applies to the millionaire deadbeat who hides his assets as well as the working family struggling to survive.

Mr. KENNEDY. Mr. President, Senator Sessions, on the floor yesterday, criticized Elizabeth Warren's study on bankruptcies, and the high percentage of bankruptcy filers who file because of significant debt related to illness and medical costs, uses. Senator Sessions cited a U.S. Trustee Program ``survey'' from 2002 that looked into medical costs as a factor in bankruptcy. He argued that ``only slightly more than 5 percent of unsecured debt reported in those cases was medically related;'' ``54 percent of the cases listed no medical debts whatsoever. I want to repeat that,'' he said. He also said that ``they found that 90 percent of the cases that did have medical debts reported debts of less than $5,000.'' Elizabeth Warren sent a letter to the Judiciary Committee last month which pointed out many of the problems with this U.S. Trustee Program ``survey'': The survey underreported both the breadth and impact of medical bankruptcies because of the way it was conducted. U.S. trustee's sample was limited only to chapter 7 cases and omitted chapter 13 cases. Families filing for bankruptcy under chapter 7 have an annual median income of $19,000. Therefore, the average medical debt identified by the U.S. trustee--the average is $5,000 for those with medical debt--is quite substantial for those families trying to cope with medical problems. Mr. President, $5,000 in medical debt is more than 25 percent of the annual income for that family. The petition data used by the Office of the U.S. Trustee does not include any medically related debts charged onto credit cards such as prescription medications, doctors visits, rehabilitation treatments, medical supplies, hospital bills, or even second mortgages that people have put on their homes to pay off hospital bills and other medical expenses, or cash advances, bank overdrafts or payday loans that people have incurred to pay for medical services when they are delivered or to pay medical bills that are outstanding. If any of these bills were paid by being charged on a credit card, then the trustee's survey would not include them in its figures. For these and other reasons, the petition data gathered by the U.S. Trustee Program provides very little information about medical bankruptcy. This is why it is so important to survey the debtors themselves in order to collect accurate data, the way the Harvard study actually did. I suggest the absence of a quorum.

Mr. KENNEDY

Mr. KENNEDY. Mr. President, 1,500 American service men and women have been killed in Iraq, and more than 11,000 have been wounded. We were all moved by the Iraqi elections last month. I and all Americans support the creation of a legitimate, functioning Iraq Government that guarantees the rights of all Iraqis. We all want democracy in Iraq to take root firmly and irrevocably. But we also want to know when we will have achieved our mission in Iraq and when our 135,000 soldiers will be able to return home with dignity and honor. At a March 1 hearing in the Senate Armed Services Committee, General Abizaid, the leader of the Central Command, gave the clearest indication so far about when our mission might end. General Abizaid said, ``I believe that in 2005, the most important statement that we should be able to make is that in the majority of the country, Iraqi security forces will take the lead in fighting the counterinsurgency. That is our goal.'' About the capabilities of the Iraqi security forces, General Abizaid said, ``I think in 2005 they'll take on the majority of the tasks necessary to be done.'' If the Iraqis make the significant progress this year that General Abizaid expects, it is perfectly logical to expect that a large number of American troops will be able to return home. Our troops are clearly still needed to deal with the insurgency. But there is wide agreement that the presence of American troops is also fueling the insurgency and making it more difficult to defeat. After the election, the administration announced that 15,000 American troops added to provide security for the elections would return, and additional troops should be able to return this year. Doing so would clearly help take the American face off the occupation and send a clearer signal to the Iraqi people that we have no long-term designs on their country. In the February 28 edition of US News and World Report, General Abizaid emphasized this basic point. He said ``An overbearing presence, or a larger than acceptable footprint in the region, works against you . . . The first thing you say to yourself is that you have to have the local people help themselves.'' Deputy Secretary Wolfowitz made the same point in a hearing at the Senate Armed Services Committee on February 3. He said, ``I have talked to some of our commanders in the area. They believe that over the course of the next six months you will see whole areas of Iraq successfully handed over to the Iraqi army and Iraqi police.'' Before the election, the administration repeatedly stated that 14 of the 18 provinces in Iraq are safe. We heard a similar view in a briefing from Ambassador Negroponte. If some areas can be turned over to the Iraqis in the next 6 months, as Secretary Wolfowitz indicated, it should be done. It would be a powerful signal to the Iraqi people that the United States is not planning a permanent occupation of their country. If entire areas are being turned over to the Iraqis, we should be able to bring many American troops home. The road ahead will be difficult because the violence is far from ended. Sixty-six Americans soldiers have been killed in the 31 days since the election an average of two a day. But the election has produced new hope, and the Iraqi people are now forming the Transitional Government that will write a new constitution for the country and hold elections next December for the permanent new government that will lead their new democracy. We all hope for success in Iraq, and appropriate withdrawals of our forces can clearly be an important factor in achieving that success. The President's commitment to keeping American troops in Iraq as long as it takes and not a day longer is not enough for our soldiers and their loved ones. They deserve a clearer indication of what lies ahead, and so do the American people. General Abizaid has begun to provide clarification of that very important issue, and I hope the President will as well.

Mr. KENNEDY

Mr. KENNEDY. Mr. President, it is a privilege to join Senator Sessions, Senator Durbin and Senator Dodd in introducing the ``National All Schedules Prescription Electronic Reporting Act.'' Our goal is to help States establish electronic databases to monitor the use of prescription drugs and deal more effectively with the growing national problem of prescription drug abuse. Over 6 million Americans currently use prescription drugs for non- medical purposes. 31 million say they've abused such drugs at least once in their lifetime. Since 1992, the number of young adults who abuse prescription pain relievers and other addictive drugs has more than tripled. Prescription drug abuse among youths 12 to 17 has soared tenfold. State programs to monitor addictive medications can help curb this abuse. Currently, 20 States have such programs in place, including Massachusetts, but they vary greatly in the collection and storage of the data, and in the methods for using the databases. The information contained in these databases is important, because it can be used to identify physicians and patients who encourage the non- medical use of prescription drugs. It can also be used to reduce the diversion of prescription drugs for illegal use. Our bill authorizes the Secretary of HHS to make grants to States to establish these needed monitoring programs. For States with existing programs, the grants can be used to improve their systems and standardize the data collected to allow easy sharing of the information between the States. Any such program, however, must include strong safeguards for medical privacy, and make certain that the database cannot be used to put improper pressure on physicians to avoid prescribing essential drugs. The proper treatment of pain, for example, is an enormous medical challenge, but this essential care will be much more difficult if patients fear that their prescription histories will not be protected, or if physicians begin to look over their shoulder every time they prescribe pain medication. We all share the goal of reaching the right balance between the interests of patients, physicians, and law enforcement, and we think this legislation does that. It requires that in grant applications, States must propose security standards for the electronic databases, including appropriate encryption or other information technology. States also must propose standards for using the database and obtaining the information, including certifications to be sure that requests for information are legitimate. The bill requires the Secretary to provide a follow-up analysis of the privacy protections within two years after enactment. The national problem of prescription drug abuse worsens every year. Physicians want to treat pain without contributing to addiction. Law enforcement officials want to stop the flow of prescription drugs from pharmacies to the streets. A national prescription drug monitoring program will provide a valuable resource to achieve these goals. I commend Senator Sessions for his leadership on this important health issue, and I urge my colleagues to join us in this effort to fight prescription drug abuse.

Mr. KENNEDY. Mr. President, it is a privilege to join Senators Hutchinson, Schumer, and Cornyn in introducing the Hepatitis C Epidemic Control and Prevention Act. Our goal is to provide for the prevention, control, and treatment of Hepatitis C viral infection through education, surveillance, early detection, and research. Hepatitis C is the most common, chronic, blood-borne infection in the United States. An estimated 5 million Americans are now infected with the Hepatitis C virus, and 30,000 more are infected every year. The rate of infection continues to rise--between 1990 and 2015, the Centers for Disease Control and Prevention project a 4-fold increase in the number of persons with chronic infection of the virus. Persons infected with the Hepatitis C virus come from all walks of life, but those at greatest risk include health workers, emergency service personnel, and drug users. Tragically, the majority of infected individuals are unaware of their infection, are not receiving treatment, and are sources of transmission of the virus to others. Infection with the Hepatitis C virus has serious health effects. It can cause liver disease, including cirrhosis and liver cancer, and is the leading indicator for liver transplants. The illnesses are often life-threatening--up to 10,000 Americans die yearly from Hepatitis C complications, and it is the 7th leading cause of death for men between the ages of 25 and 64. In addition to the human costs, the disease has massive financial implications. Direct costs associated with care are expected to exceed $1 billion a year by 2010. Without intervention, the epidemic is projected to result in costs of over $54 billion by the year 2019. Greater Federal investment will have a critical role in reversing this silent epidemic. Our Hepatitis C bill will increase public awareness of the dangers of Hepatitis C, and make testing widely available. For those already infected, it will provide counseling, referrals, and vaccination against Hepatitis A and B and other infectious diseases. It will also support research to develop a vaccine against Hepatitis C, just as we now have for Hepatitis A and B. It will create a multiagency Liver Disease Research Advisory Board and mandate a study of programs used by the Veteran's Administration, in order to provide important lessons and models of care for the nation. The Centers for Disease Control and Prevention will increase surveillance activities, and provide Hepatitis C coordinators to provide technical assistance and training to state public health agencies. This bill will have a major impact on the lives of millions of Americans who are infected by Hepatitis C, and the families and loved ones who care for them. I look forward to working closely with my colleagues to act quickly to pass this needed legislation. I especially commend the impressive work of the students at Robinson Secondary School in Fairfax, VA, for their continuing dedication to informing Members of Congress about this important issue and bringing national attention to it.

Mr. KENNEDY. Mr. President, I'm pleased to join my colleagues in introducing the Caring for Children Act of 2005. We were able to work together on both sides of the aisle to prepare this bill to reauthorize the Child Care and Development Block Grant program. The Caring for Children Act reflects our common goals to expand access and improve the quality of child care for children and families throughout the Nation. Child care is a key issue in both welfare reform and education reform. The success of our welfare system rests on our ability to provide dependable and consistent child care support for low-income families, so that they can work and provide for their families. Improving the quality of child care and the environment in which our children develop is an essential responsibility of our society as a whole, and this legislation can be an important part of our effort in Congress to meet that responsibility. Today, 65 percent of parents with young children and 79 percent of parents with school age children are in America's workforce. During the working day, 14 million children are cared for by someone other than a parent. For low-income families and single mothers, child care assistance is a lifeline. Low-income mothers who receive child care assistance are 40 percent more likely to remain employed after 2 years, compared to those who do not receive such support. Yet child care is still unaffordable for far too many families--full-day care can easily cost thousands of dollars a year and become an impossible expense for millions of families. The Caring for Children Act will expand access to child care and do more to deliver the support that working parents need in obtaining effective child care. The bill supports activities to help parents fmd quality care through State Resource and Referral Centers, so that greater information and outreach to parents will be available. Child care is a vital support for working parents, and it is also an essential link in preparing young children for school. Research shows that the early environments in which children learn and develop have a profound impact on their later development and on their success in school. Unfortunately, much remains to be done to improve the quality of child care. Nearly half of all kindergarten teachers report that the majority of children in each entering class has specific problems, including difficulty in following directions, lack of even the most basic academic skills, troubled situations at home, or difficulty in relating to other children. The Caring for Children Act seeks to improve the quality of child care available to low-income children and their families through the Child Care and Development Block Grant. The bill will raise the amount of funds that States must dedicate to quality activities from 4 to 6 percent. Most important, the Act will promote better child care by focusing on activities that make children ready to learn, and encouraging States to improve child safety and well-being. Funds will be used to provide greater training and support for child care workers, establish voluntary guidelines for school preparedness, and enhance the early learning of young children. Investments in the child care workforce are also essential to improve the quality of care. Today, only one in seven child care centers provides a level of quality adequate for child development. Thirty states have no pre-service training requirements for child care workers. Our bill supports professional development and education opportunities for child care providers to upgrade their skills and to use proven and effective early learning materials and teaching strategies in their work. It encourages states to increase the recruitment and retention of qualified child care staff and reduce the high turnover rates in child care centers. We must also do more to ensure that states provide timely and adequate payments for high quality care. The Caring for Children Act will improve reimbursement rates for care in the states, and more effectively use the market survey required under current law to establish payment rates. I commend Senator Reed for his leadership on those provisions. Finally, the Caring for Children Act creates a new Federal commitment to serve children in need, including families with infants and toddlers, children with disabilities, and families that require special care during non-traditional work hours. Thanks to Senator Harkin's leadership, the needs of infants and toddlers will continue to be addressed in this bill. The Caring for Children Act builds on effective practices already underway in many states, but we still have a long way to go to see that all children have access to good child care. More resources are clearly required, and the need is urgent. In nearly half the states, eligible children are being placed on waiting lists or being turned away altogether. In Massachusetts, over 16,000 low-income children are on waiting lists. Instead of responding to this need, the President's budget for Fiscal Year 2006 freezes funding for the Child Care and Development Block Grant. Under the Administration's own calculations, 300,000 fewer low- income children will have access to child care assistance by 2010. Surely, we can do better. It makes no sense to cut back on child care for low-income children. We need to serve as many needy children as possible. I look forward very much to working with our colleagues on the Finance Committee to make that goal a reality as the reauthorization of the Temporary Assistance for Needy Families Block Grant moves forward this year. I commend Senators Enzi, Alexander, and Dodd for their impressive work on this bill. I urge all of my colleagues in the Senate to support this important legislation and work with us to provide the support for quality child care that low-income families throughout America need and deserve.

Mr. KENNEDY

Mr. KENNEDY. Mr. President, it is a privilege to join Senator Sessions, Senator Durbin and Senator Dodd in introducing the ``National All Schedules Prescription Electronic Reporting Act.'' Our goal is to help States establish electronic databases to monitor the use of prescription drugs and deal more effectively with the growing national problem of prescription drug abuse. Over 6 million Americans currently use prescription drugs for non- medical purposes. 31 million say they've abused such drugs at least once in their lifetime. Since 1992, the number of young adults who abuse prescription pain relievers and other addictive drugs has more than tripled. Prescription drug abuse among youths 12 to 17 has soared tenfold. State programs to monitor addictive medications can help curb this abuse. Currently, 20 States have such programs in place, including Massachusetts, but they vary greatly in the collection and storage of the data, and in the methods for using the databases. The information contained in these databases is important, because it can be used to identify physicians and patients who encourage the non- medical use of prescription drugs. It can also be used to reduce the diversion of prescription drugs for illegal use. Our bill authorizes the Secretary of HHS to make grants to States to establish these needed monitoring programs. For States with existing programs, the grants can be used to improve their systems and standardize the data collected to allow easy sharing of the information between the States. Any such program, however, must include strong safeguards for medical privacy, and make certain that the database cannot be used to put improper pressure on physicians to avoid prescribing essential drugs. The proper treatment of pain, for example, is an enormous medical challenge, but this essential care will be much more difficult if patients fear that their prescription histories will not be protected, or if physicians begin to look over their shoulder every time they prescribe pain medication. We all share the goal of reaching the right balance between the interests of patients, physicians, and law enforcement, and we think this legislation does that. It requires that in grant applications, States must propose security standards for the electronic databases, including appropriate encryption or other information technology. States also must propose standards for using the database and obtaining the information, including certifications to be sure that requests for information are legitimate. The bill requires the Secretary to provide a follow-up analysis of the privacy protections within two years after enactment. The national problem of prescription drug abuse worsens every year. Physicians want to treat pain without contributing to addiction. Law enforcement officials want to stop the flow of prescription drugs from pharmacies to the streets. A national prescription drug monitoring program will provide a valuable resource to achieve these goals. I commend Senator Sessions for his leadership on this important health issue, and I urge my colleagues to join us in this effort to fight prescription drug abuse.

Mr. KENNEDY

Mr. KENNEDY. Mr. President, it is a privilege to join Senators Hutchinson, Schumer, and Cornyn in introducing the Hepatitis C Epidemic Control and Prevention Act. Our goal is to provide for the prevention, control, and treatment of Hepatitis C viral infection through education, surveillance, early detection, and research. Hepatitis C is the most common, chronic, blood-borne infection in the United States. An estimated 5 million Americans are now infected with the Hepatitis C virus, and 30,000 more are infected every year. The rate of infection continues to rise--between 1990 and 2015, the Centers for Disease Control and Prevention project a 4-fold increase in the number of persons with chronic infection of the virus. Persons infected with the Hepatitis C virus come from all walks of life, but those at greatest risk include health workers, emergency service personnel, and drug users. Tragically, the majority of infected individuals are unaware of their infection, are not receiving treatment, and are sources of transmission of the virus to others. Infection with the Hepatitis C virus has serious health effects. It can cause liver disease, including cirrhosis and liver cancer, and is the leading indicator for liver transplants. The illnesses are often life-threatening--up to 10,000 Americans die yearly from Hepatitis C complications, and it is the 7th leading cause of death for men between the ages of 25 and 64. In addition to the human costs, the disease has massive financial implications. Direct costs associated with care are expected to exceed $1 billion a year by 2010. Without intervention, the epidemic is projected to result in costs of over $54 billion by the year 2019. Greater Federal investment will have a critical role in reversing this silent epidemic. Our Hepatitis C bill will increase public awareness of the dangers of Hepatitis C, and make testing widely available. For those already infected, it will provide counseling, referrals, and vaccination against Hepatitis A and B and other infectious diseases. It will also support research to develop a vaccine against Hepatitis C, just as we now have for Hepatitis A and B. It will create a multiagency Liver Disease Research Advisory Board and mandate a study of programs used by the Veteran's Administration, in order to provide important lessons and models of care for the nation. The Centers for Disease Control and Prevention will increase surveillance activities, and provide Hepatitis C coordinators to provide technical assistance and training to state public health agencies. This bill will have a major impact on the lives of millions of Americans who are infected by Hepatitis C, and the families and loved ones who care for them. I look forward to working closely with my colleagues to act quickly to pass this needed legislation. I especially commend the impressive work of the students at Robinson Secondary School in Fairfax, VA, for their continuing dedication to informing Members of Congress about this important issue and bringing national attention to it.

Mr. KENNEDY

Mr. KENNEDY. Mr. President, I'm pleased to join my colleagues in introducing the Caring for Children Act of 2005. We were able to work together on both sides of the aisle to prepare this bill to reauthorize the Child Care and Development Block Grant program. The Caring for Children Act reflects our common goals to expand access and improve the quality of child care for children and families throughout the Nation. Child care is a key issue in both welfare reform and education reform. The success of our welfare system rests on our ability to provide dependable and consistent child care support for low-income families, so that they can work and provide for their families. Improving the quality of child care and the environment in which our children develop is an essential responsibility of our society as a whole, and this legislation can be an important part of our effort in Congress to meet that responsibility. Today, 65 percent of parents with young children and 79 percent of parents with school age children are in America's workforce. During the working day, 14 million children are cared for by someone other than a parent. For low-income families and single mothers, child care assistance is a lifeline. Low-income mothers who receive child care assistance are 40 percent more likely to remain employed after 2 years, compared to those who do not receive such support. Yet child care is still unaffordable for far too many families--full-day care can easily cost thousands of dollars a year and become an impossible expense for millions of families. The Caring for Children Act will expand access to child care and do more to deliver the support that working parents need in obtaining effective child care. The bill supports activities to help parents fmd quality care through State Resource and Referral Centers, so that greater information and outreach to parents will be available. Child care is a vital support for working parents, and it is also an essential link in preparing young children for school. Research shows that the early environments in which children learn and develop have a profound impact on their later development and on their success in school. Unfortunately, much remains to be done to improve the quality of child care. Nearly half of all kindergarten teachers report that the majority of children in each entering class has specific problems, including difficulty in following directions, lack of even the most basic academic skills, troubled situations at home, or difficulty in relating to other children. The Caring for Children Act seeks to improve the quality of child care available to low-income children and their families through the Child Care and Development Block Grant. The bill will raise the amount of funds that States must dedicate to quality activities from 4 to 6 percent. Most important, the Act will promote better child care by focusing on activities that make children ready to learn, and encouraging States to improve child safety and well-being. Funds will be used to provide greater training and support for child care workers, establish voluntary guidelines for school preparedness, and enhance the early learning of young children. Investments in the child care workforce are also essential to improve the quality of care. Today, only one in seven child care centers provides a level of quality adequate for child development. Thirty states have no pre-service training requirements for child care workers. Our bill supports professional development and education opportunities for child care providers to upgrade their skills and to use proven and effective early learning materials and teaching strategies in their work. It encourages states to increase the recruitment and retention of qualified child care staff and reduce the high turnover rates in child care centers. We must also do more to ensure that states provide timely and adequate payments for high quality care. The Caring for Children Act will improve reimbursement rates for care in the states, and more effectively use the market survey required under current law to establish payment rates. I commend Senator Reed for his leadership on those provisions. Finally, the Caring for Children Act creates a new Federal commitment to serve children in need, including families with infants and toddlers, children with disabilities, and families that require special care during non-traditional work hours. Thanks to Senator Harkin's leadership, the needs of infants and toddlers will continue to be addressed in this bill. The Caring for Children Act builds on effective practices already underway in many states, but we still have a long way to go to see that all children have access to good child care. More resources are clearly required, and the need is urgent. In nearly half the states, eligible children are being placed on waiting lists or being turned away altogether. In Massachusetts, over 16,000 low-income children are on waiting lists. Instead of responding to this need, the President's budget for Fiscal Year 2006 freezes funding for the Child Care and Development Block Grant. Under the Administration's own calculations, 300,000 fewer low- income children will have access to child care assistance by 2010. Surely, we can do better. It makes no sense to cut back on child care for low-income children. We need to serve as many needy children as possible. I look forward very much to working with our colleagues on the Finance Committee to make that goal a reality as the reauthorization of the Temporary Assistance for Needy Families Block Grant moves forward this year. I commend Senators Enzi, Alexander, and Dodd for their impressive work on this bill. I urge all of my colleagues in the Senate to support this important legislation and work with us to provide the support for quality child care that low-income families throughout America need and deserve.

Mr. KENNEDY

Mr. KENNEDY. Madam President, I ask unanimous consent that we set aside any pending amendments. I send to the desk two amendments and ask they be immediately considered.

Mr. KENNEDY. Madam President, I had the opportunity to talk with our floor leaders. Because my amendments are related, I am prepared to discuss or debate these issues and to consider them together, if it is agreeable with the other side. Then we could enter into a time agreement and leave that up to the leadership as to when we might move ahead and vote on them, hopefully back to back, with a brief interlude of, I think, probably 4 minutes evenly divided, so we would have a chance later in the day to describe them. I do not offer that as a unanimous consent request at this time. I just mention on the floor now that it is my understanding that it will be worked out by the leadership, so Members have some idea as to how we are going to proceed. These two amendments relate to the health care challenges so many of our fellow citizens are facing in with regard to going into bankruptcy. We know at the present time there are 1.5 million people who go into bankruptcy every year. Half of those people go into bankruptcy because of medical bills. About three-quarters of those individuals who go into bankruptcy because of the medical bills have health insurance, but nonetheless the explosion of costs in health care have added such a burden to these families that they have had to go into bankruptcy. It does seem to me if the purpose of this legislation is to try to deal with spendthrifts and those who are abusers of credit, we ought to be able to distinguish between hard-working Americans, basically middle- class working families who have health insurance or those right on the margin who wish they had health insurance, who perhaps lost their health insurance because of a change in their employment, and then suddenly are facing catastrophic health needs, and those who irresponsibly acquire debt. What are those types of health needs? We start off with cancer. The average out-of-pocket expenditure, even for families who have insurance, is approximately $35,000. That often is enough to trigger a family to go into bankruptcy because of the limitations it puts on the income of the families. Often it is one of the breadwinners of the family who becomes ill, and it is the loss of that breadwinner's income, not only the medical bills, that in frequent instances drives that family into bankruptcy. I will give some examples of why that happens. It does seem to me we should not apply the harsher provisions--and they are harsher provisions, what is called the means test--the harsher provisions that put an additional penalty on those families than already exists in the current bankruptcy law. That effectively is what one of the amendments addresses. The second amendment says if those families are going to go into bankruptcy, then we are going to let them preserve their homestead to the extent of $150,000 of equity in their primary residence through a homestead exemption. The average cost of a house in this country is $240,000. It is vastly more expensive in my part of the country. In Massachusetts the cost of housing is the second highest in the country. In many of the areas in the Northeast, in the coastal areas, and even in the heartland of this Nation, housing is much more than $150,000. What we are trying to say is that it is hard enough, meeting the personal burdens of illness and sickness and disease--in the case I just mentioned in terms of cancer, but those conditions apply as well if you have heart disease, stroke, other kinds of serious illness, or if you have a child who has serious illness: autism, spina bifida, the whole range of challenges which infants have. More often than not, the health insurance proposals, most that I have seen, exclude any complications in the first 10 days of life. That is the time the illness or sickness is detected in many of these children, and that is when the economic spiral down starts. What we are saying in these two amendments is, No. 1, it is difficult enough to face the pain and anxiety of a serious medical condition. You should not have the more punitive provisions under the means test. We can go into details about how they would be expected to pay a good deal more from the means test even though under the current law they would not have to. They would have their assets and their liabilities and there would have to be a determination for the payment, what assets they have, and then they could start fresh. Under the means test it would mean further obligations for the next 5 years, and the real question is how some of these individuals would be able to survive and, secondly, to say these families face a serious enough problem and they should not lose a home where they have equity of $150,000 or less. There will be those who say this bill is not about our health care system, which has its good points and has its bad points. We are not debating that today. We ought to debate comprehensive health care for this country, and ways we try to get a handle on health care costs-- that is all well and good. But what we have to do if we are going to try to be honest to the consumers and families of this country is talk about what the implications of this legislation are going to be. One of the serious facts that remains is for those people who have serious indebtedness through no fault of their own, who have worked hard, played by the rules, have gotten health insurance or in other instances lost their jobs, they are not going to be penalized and forced into indentured servitude, basically, for the credit card companies--because they are the principal beneficiaries of these provisions. So it is only fair we say that. People will say we have homestead laws in this country. They apply across the Nation. The fact is, in most of the parts of the country, the homestead provisions are less than $25,000--$25,000 or less. The fact is, this legislation applies to 50 States, not to one State or two States. It applies to 50 States. It has application to all the people in all 50 States. So if we are going to apply something to all 50 States, why not at least have some uniformity? We think it is difficult enough and tragic enough that you are going to have a health challenge that is going to wipe out your family and perhaps even cause death; we are not going to take a home away that is worth $150,000. Those are the facts. Those are essentially the provisions. I will mention them in greater detail. The first amendment exempts from the means test any debtor whose severe medical expenses have caused financial hardship and forced them to file bankruptcy. Financial hardship is defined in the amendment as one of the following: Being out of work for a month or more or unreimbursed medical expenses totaling 25 percent of your income. This is your out-of-pocket, after all the other expenses--25 percent of your income. We estimate that about 20 percent of all bankruptcy filers-- this doesn't even reach all of those who are going to be medically bankrupt, but it would reach about 20 percent of all bankruptcy filers in this category. They would be exempted from the means test through these provisions. The proponents of the bankruptcy bill have said the goal of the bill is to force those individuals who run up bills irresponsibly to take greater personal responsibility. They claim that people are going to the mall making frivolous purchases such as plasma televisions and designer clothes and then going to bankruptcy court to discharge their debts. Nothing could be further from the truth for the thousands of individuals who are forced into bankruptcy to deal with the debt they were forced to take on to cope with serious medical expenses and the loss of income when they are unable to work due to serious illness or injury. We had testimony from Professor Elizabeth Warren of the Harvard Law School last week making clear that more than half of those filings for bankruptcy have been forced to do so at least in part due to medical problems and their aftermath. If the goal of the bill is to deal with those individuals who some feel are abusing the bankruptcy process, we ought to protect those individuals who are forced into bankruptcy through no fault of their own. We will listen to the proponents of the bill say: Look, we want to have people responsible here in the United States of America. Those people who go out and buy the fancy yachts, go to the mall, run up bills, ought to be held accountable. Absolutely, I say. Put me on as a cosponsor. But that ain't what this bill does. As a matter of fact, there is an enormous loophole in this bill that ought to shame its proponents who have left it in there with regard to spendthrifts. We will come to that later. Let me finish a brief description of these two amendments. Those who go to bankruptcy court because of cancer or diabetes and heart attacks have not been irresponsible. Those who file for bankruptcy to deal with medical debts incurred when a child was born early with severe complications or an elderly parent needing costly prescription drugs or placement in a nursing home are not irresponsible. These clearly are not the type of debtor the proponents of this bill say they are; the kinds of debts that the proponents of the bill are trying to address. They deserve a chance to make a fresh start, and a specific exemption from the applications of the means test gives them that chance. They will still be subject to the bankruptcy law as it is today but not the additional kinds of punitive aspects that exist in this proposed bill under the means test. The second amendment provides that medically distressed debtors be allowed to protect, at a minimum, $150,000 of the equity in their primary residence through a homestead exemption. The enormous increase in medical debt and the bankruptcy cases caused by medical debts, along with the significant increase in real estate prices over the recent years, have led to a new and rapidly growing problem. Families who face insurmountable debt problems following serious medical problems are faced with obtaining relief from their debts in bankruptcy only if they give up their homes. A family should not have to lose their home to obtain relief from debts caused by serious medical problems. These families should not be forced to choose between debt relief and losing their modest homes. In nearly half of all States, homestead exemptions are less than $25,000. Several States have no homestead exemption. People facing bankruptcy in these States are often forced to give up their home to obtain debt relief. In a chapter 7 bankruptcy case, the family with equity greater than the State exemption limits can be forced to give up their home. In chapter 13, the family must pay the creditors an amount equal to the equity above the homestead exemption, which they cannot afford. The amount of equity a homeowner can protect in bankruptcy has not kept up with the rise in home prices. This change of $25,000 has been there for years and years. I don't know where you can find a home in this country for $25,000. With incomes of $800 or $1,000 per month, they could live in their current homes, which may be paid off, and have low monthly costs. If they are forced out of their homes, they can't afford to rent a decent place to live. Effectively, these homeowners have no bankruptcy relief available to them. They sell the home, and they are told, OK. They are on a fixed income of Social Security, getting $1,000, perhaps, a month. How are they going to be able to afford to rent the places available to them at $800 to $1,000 and have enough to live on? The notion of forcing people out of their homes after an illness or an accident is made more outrageous by the fact that in a handful of States, debtors of all kinds--famous sports figures, doctors who drop their malpractice insurance, real estate tycoons--can shelter millions of dollars in homestead. Do we understand that? In this legislation, there is a handful of States where individuals can shelter their homes from creditors who won't be able to get access to it. Yet when we say, OK, let us just protect others in other States up to $150,000, they say, No, we are not going to do that, no, because you know the States ought to make the decision. This bill applies to 50 States. If you are going to take that position, why not wipe out the exemption that exists for these handful of other States? Where is the fairness in this bill? Where is the fairness? Why should wealthy individuals be able to shelter their income in half a dozen States and escape all of the harshness of this bill and other hard-working, decent people who have lived in their homes over a lifetime find out their housing disappears as it goes into bankruptcy? Please. Where is the fairness? Where in the world is the fairness?

Mr. KENNEDY. Yes.

Mr. KENNEDY. The Senator is absolutely correct. The average cost of a home in America is $240,000. We are only talking at $150,000. I am sure the Senator can relate to us the kinds of situations that I see of these three-decker houses, not only in Boston but in many of the older cities and in my State where families have lived there for years and years. They see the increase in the water rate of $50 to $75, and they wonder how they are going to be able to afford it. What we want to say is to those individuals who are faced with hardship, worked hard all of their lives, more often than not have been able to get health insurance but find out that health insurance is not enough. As a result of cancer, serious heart failure, serious illnesses, diabetes, or a child that needs special kinds of attention, they go in to debt--after it is all said and done, let them list their assets and their liabilities and pay what they need, but don't take their home away from them.

Mr. KENNEDY. Perhaps the Senator can explain how that meets any definition of fairness, how that meets any requirement of treating people equitably. We have the proponents in the Senate Chamber; they ought to be able to explain that. They have resisted treating the families the same in all parts of the country. This is one of the fatal failures in this one area, the homestead area. The Senator is absolutely correct. As the Senator knows, we are talking about individuals who have worked hard more often than not, have gotten health insurance and tried to provide for their families, but then that incident occurs, the cancer occurs, the heart failure occurs, the diabetes occurs. We have a growing aging population. Increases in bankruptcy among the elderly have risen by two or three times in the last 5 years. The basic projections are increasing because they will have increasing health care needs. We are saying to these individuals who have been part of this American fabric and have helped more often than not in fighting our wars, they have built this country, saved for their children, now they will end up getting thrown out of their home through no fault of their own because they are blighted with some form of cancer.