Jim McDermott

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, I yield 2 minutes to the gentleman from California (Mr. Becerra).

Mr. McDERMOTT. Mr. Speaker, I yield 2 minutes to the gentleman from Virginia (Mr. Scott).

Mr. McDERMOTT. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from Georgia (Mr. Lewis).

Mr. McDERMOTT. Mr. Speaker, I yield myself 3 minutes, and I rise in opposition to H.R. 3129. This is another bill that is put out here to confuse people, to throw sand in the eyes of Members of Congress. It was presented to the committee as a pay bill for Customs people. We voted on it there. And between the committee and coming to the floor, they suddenly took that all out and put a study in. Thank you very much, Mr. Chairman, we appreciate that. The other provisions were no good. But what is left is not good either, because it should have gone to the Committee on the Judiciary. The sections which pertain to immunity of Customs agents and allowing the unwarranted search of outgoing U.S. mail should have been talked about by the Committee on the Judiciary. It seems to me that the Ways and Means was used as a way to go around the Committee on the Judiciary, rather than having them consider what needs to be done. Now, our Customs agents are good and sincere people who have grave responsibilities. Unfortunately, there have been abuses of the authority that Customs agents have. A March 2000 General Accounting Office report found that while black female citizens were nine times more likely than white female citizens to be subject to x-ray searches by the Customs Service, these black women were less than half as likely to be found carrying contraband as white women. Section 141 of the bill would exempt the Customs officer from liability for engaging in illegal body cavity search and from liability for illegal searches, provided the officer acted in good faith. Now, there is no reason put forward why we should change the standard set by the Supreme Court that the reasonableness of an officer's behavior is the proper test of liability. In the aftermath of the GAO study, many changes were instituted by Customs, and I believe that we should not change this in this way. This is also not the time to give them a new standard about looking at mail. We prevent mail from coming in without a search because we are protecting ourselves. When it is going out, there is no justification given for why we are doing that. I think that that is another change, a power grab by the Justice Department, done through the Committee on Ways and Means. And without anybody talking about it, they then added $9 billion to Customs for agents to deal with transshipment. Now, my colleagues, that is put in the bill for one reason and one reason only: To get textile people to say they are going to keep the textiles out of our country, we have good protectionists, so I can vote for trade promotion authority. It is simply a sop to Members. Now, if Members think this is going to go over to the Senate and pass, remember, this has to go through the Senate. Passing in the House is not enough. This is a sop that will not work. I will vote ``no.''

Mr. McDERMOTT. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, the gentlewoman's program has been funded for 3 years without authorization. We do not need this bill for that purpose. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from New York (Mr. Rangel).

Mr. McDERMOTT. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Texas (Mr. Doggett).

Mr. McDERMOTT. Mr. Speaker, I yield 2 minutes to the gentleman from Michigan (Mr. Conyers) to clarify what the Department of Justice wants.

Mr. McDERMOTT. Mr. Speaker, I yield myself the balance of my time to close. Mr. Speaker, there is an old rule in politics: If you got the votes, shut up. And I guess that is what the chairman is thinking. But the fact is that the silence on the other side in answer to these constitutional questions, the fact that the chairman of the Committee on the Judiciary never even came out here, no one came out here to rebut a single question of the Constitution, speaks louder than any words you could have spoken in the minutes that you have reserved. I am sure that when people listen, I guess silence means assent, they agree on the other side that we are right. We are taking away fourth amendment rights, and we are doing it without any hearings. This is really a sad day for the Constitution on the floor of the House of Representatives.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, I think that is why this bill is really a fraud. It seems to do something for people but it is not clear. It is subject to interpretation by the Department of Labor.

Mr. McDERMOTT. Mr. Speaker, the gentleman from Michigan thinks so? So I have got to go home to my district and tell my people they might be covered by this, it is not clear?

Mr. McDERMOTT. I yield to the gentleman from Michigan.

Mr. McDERMOTT. Mr. Speaker, whatever of the issues are in the trade adjustment bill, they are not the reason this bill is out here. This bill is out here as a vehicle for putting some things through the House that the chairman and others think will blind the eyes of Members of this House and will offer them some hope that there will be something done for the unemployed workers in this country, and that then they will say, well, since we have done that for the unemployed workers, we can now go ahead and pass fast track. Now, the Speaker stood right here and promised us that we would do something about the health care and the unemployed workers of this country. When this bill came before the committee, every amendment was nongermane. No one said this is our chance to put unemployment up here. This is our chance to put up health care. It was a narrow little trade adjustment bill. And so now, after it gets out of the committee, they take it up to the Committee on Rules, and the Committee on Rules sticks in a bunch of stuff that nobody has looked at. There is not anybody who can stand on this floor and say there will be one single unemployed worker in this country whose health care benefits will be protected by this bill. There is a bill that is going over to the Senate in the last days of the session, and we have had a recession in this country since March and we have not done anything, and we are here on the 5th of December, 6th of December, whatever it is, and we still have not had hearings in the House of Representatives on what really needs to be done to the unemployment system. We have States in this country that do not have enough money for 3 months of unemployment benefits. Did we have a hearing on that? Did we talk about it? No. We have simply stuck $9 billion into a bill that went out of here, called the stimulus package, and said give it to the Governors; they will do whatever is right. Well, at least they figured out now that they want to make it done by the Congress, because Governors would have to call legislators into session to get anything done. This is a fraud. This is a fraud. It has not had hearings, and you people have messed up the Medicare system in this country because you will not have hearings and figure out how it is going to work. And then suddenly since 1997, we are back every year fixing, fixing, fixing. Here's $2 billion for health; just throw it out there into the air and maybe it will happen to come down in the hands of somebody who is unemployed. Give it to the Governors. Where is that going to get anybody? We are all going to vote for this, but nobody should be confused about what this is.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, I rise today in opposition to H.R. 3005, the Trade Promotion Authority Act of ``Fast Track'' as it is commonly called. Let me first say that there probably isn't a Member in the House that has voted in favor of more trade legislation that I have. No part of the country is more dependent on trade than the district I represent in Congress. Almost one fourth of the jobs in the greater Seattle area are generated through trade. Trade fosters peaceful international relations, raised the quality of life of working families in our country as well as those in our partner nations. I have supported many trade agreements--MFN for China, NAFTA, AGOA and the Reciprocal Trade Agreement Authorities Act of 1998--but like any trader, I try to learn from experience, and be careful that I only endorse agreements that advance our national goals. In the past year, our country lost more than one million manufacturing jobs. We have an economy in very deep trouble. Weak prior to September 11th, on that terrible day, it began to hemorrhage. Mr. Speaker, during the 8 years of prosperity of the Clinton administration, the United States negotiated more than 300 treaties. In fact, only 4 years ago, there were those who said on this floor that without Fast Track, Chile would never negotiate a treaty with us. At the end of President Clinton's administration, Chile said they will. And several months ago the President of Costa Rica announced his country would negotiate with the United States, again without Fast Track. Brazil's Minister Councilor stated at a New America Forum that the slow pace of current FTAA negotiations, begun without Fast Track, has nothing to do with the absence of Fast Track, and everything to do with the United States' refusal to negotiate about citrus, meat and steel, products with which Brazil feels it has a competitive advantage on the table. Now, there are a lot of us who have never voted against trade bills. Never. Nobody has a district more dependent on trade than me. One out of four jobs in my district comes from foreign trade. But when you keep Congress out of it, when you do not give us a meaningful role, I cannot support it. A major problem with Representative Thomas' bill is its failure to constrain trade negotiators from repeating the mistakes in NAFTA's chapter 11 on investment. Foreign corporations are using NAFTA's investment chapter to challenge core governmental functions such as California's power to protect groundwater and the application of punitive damages by a Mississippi jury to deter corporate fraud. At the time of its ratification, few supporters of NAFTA realized that its investment chapter opened the door to such challenges. Now we know the potential impact of language being considered for inclusion in the FTAA and other agreements. H.R. 3005 fails to address the danger that the mistakes of NAFTA's chapter 11 will be repeated in negotiations for a Free Trade Area for the Americas and other future agreements. The Thomas bill would not protect multilateral environmental agreements from being challenged as barriers to trade. These critical agreements safeguard biodiversity, regulate trade in endangered species, protect the ozone layer and control persistent organic pollutants. The Thomas bill does nothing to discourage countries from lowering or eliminating their environmental standards to gain unfair trade advantages. It also fails to promote meaningful improvement in environmental protection and cooperation. The executive branch--and its Office of U.S. Trade Representative-- must not be given fast track authority that allows it to negotiate more agreements that provide sweeping and controversial protections of property rights at the expense of traditional government authority to protect fair business competition, the environment, public health, worker safety and similar public responsibilities. Rather than compromising these legitimate governmental regulations, international trade and investment agreements should pursue standards of nondiscrimination that put U.S. companies and foreign companies on a level playing field. I urge rejection of the Thomas bill and urge you to vote for the Levin-Rangel substitute.

Mr. McDERMOTT. Mr. Speaker, I demand a recorded vote.

Mr. McDERMOTT. Mr. Speaker, the last round of negotiations came down with 5,000 pages of rules and regulations. We have today out here in 1 hour set up the process by which we are going to do this all over again. The majority would have us believe that it is not even worth taking the time to look at any alternative. They say, well, you can have a motion to recommit. We can have 5 minutes to talk about the process by which we arrive at 5,000 pages of trade legislation. If Members think that is fair, if Members think that is what people sent the 435 of us here to do, they ought to vote for this. But if Members think we need a little more time, and we have been here for almost 11 months, and we come down here at the last minute and we have less than an hour for 5,000 pages. It does not work. They are going to have to come back again.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, on rollcall No. 460, had I been present, I would have voted ``yea.''

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, It is an honor for all of us in Seattle to have Dr. Leland Hartwell among us. We are very fortunate to have him as the president of the renowned Fred Hutchinson Cancer Research Center. Additionally, Dr. Hartwell is a professor of genetics and medicine at the University of Washington. I am very proud to extend my warmest congratulations to Dr. Hartwell on winning the Nobel Prize for Medicine. This prize is reflective of many years of hard work and achievement, and a lifetime commitment to saving lives. He won the most prestigious prize in medicine through pioneering research in the genetics of yeast cells, which are much easier to study than human cells. When Dr. Hartwell first began studying baker's yeast cells over 30 years ago, he and other scientists were not all that confident that the research would apply to human cells, According to Hartwell, the most sophisticated technology they used was often a toothpick. But hard work and determination prevailed. Dr. Hartwell used genetics to study how cells function, to determine which genes cause cells to divide. That understanding, in turn, is helping researchers understand how cells mutate and perhaps how to prevent or reverse cancerous cell changes. He discovered more than 100 genes involved in cell-cycle control, and documented the existence of cell-cycle ``checkpoints.'' These points ensure that steps in the process have been completed properly before it proceeds. Interestingly, he discovered that cancer cells bypass the checkpoints. Indeed, Dr. Hartwell's investigation into complex cellular mechanics paved the way for others to better understand how mistakes in the process result in cancerous cell growth, Advances in clinical therapies build upon the knowledge gained from his research. Without the fundamental research, advances in science and medicine could never be achieved. I wish to thank Dr. Hartwell for his dedication to curing disease and improving human life.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, I ask unanimous consent to have my name removed as a cosponsor of H.R. 3323.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, the 8 million unemployed in this country must be watching the debate on economic stimulus in this House and in the other body with amazement and sadness. They are hardworking families who have struggled to pay their bills, and they now find themselves without work. They have worked hard, played by the rules, trying to build a better future for themselves and their families, and then have been laid off, both before and after September 11. They are 137,000 workers in the transportation industry, 136,000 in the hospitality industry, 57,000 in the communications industry, 226,000 in manufacturing, 14,000 in retail, 44,000 in the service sector, 30,000 people in my district at the Boeing company, and in finance and real estate, another 24,000. The overall jobless rate in this country shot up from 4.9 percent in September to 5.4 percent in October. In Washington State, it went from 5.1 percent to 6.1 percent. That is a 20 percent increase in a month. Now, this does not reflect everything, because there are many families who are denied benefits because the rules have been changed over the last few years. And they, although they contributed, do not have access to these benefits, or they find it virtually impossible to find employment under the present economic conditions. This week, with several of my colleagues, we introduced H.R. 3741, the Putting Americans First Act, which will at once provide a short- term enhanced safety net for those who lost their jobs. This bill empowers the States to expand unemployment coverage for 26 weeks, provide COBRA coverage, that is to cover premiums for health care and also to aid the State Medicaid benefit programs. It also addresses the needs of States whose welfare loads are increasing. Because every time we have a 1 percent increase in unemployment, the welfare load goes up between 5 and 15 percent. I urge my colleagues to go home to their States, talk to their people, and they will find out that these are the problems that are bothering them. People in this country are hurting and they are mourning. They are having trouble paying their rent, they are having trouble paying their heating bills, they are having trouble putting clothes on their kids and paying for schools, and certainly they are not ready for a medical emergency. Many States, however, are finding their own budgets in shambles because of the recession and because of tax bills that we passed in this House which took away some of their revenue. We have a situation, as described in The New York Times today, where 30 States are considering tax hikes or wide-spread cuts in benefits. Connecticut, this week, is $300 million in debt, and they are working in their legislature. Our legislature is working on a $1.2 billion cut. Infusing Federal money into these State programs through unemployment insurance and Medicaid will help the States continue some of the most important programs. Now, if we look at it, some States, Illinois, New York, North Dakota, West Virginia, Texas, do not even have enough money for 6 months of unemployment benefits, not even in their local funds. If we do not put some money in from the Federal Government, they are going to have to cut lots of people off. There are an additional 17 States that have less than a year. Now, crafting an economic stimulus package has been exceedingly difficult because it cuts to the heart of the difference between the Democrat and Republican core values. Here is the Republican argument: Corporations and entrepreneurs are the driving force in this country. They create the jobs. Tax incentives and cuts and rebates will directly help those groups, who will stimulate the economy. However, the reason corporations are not investing right now to create more jobs is not because they do not have enough cash on hand. Let us not kid ourselves. Lots of large companies have cash. The reason they are not investing right now is because there is a lack of demand. If these companies manufacture products, not enough people buy them. The best way to create jobs is to provide unemployment insurance to laid-off workers so that they can buy the necessities of their life. Why is it we are told by our colleagues on the other side of the aisle that we do not have the money for these benefits for people? They say, well, we are just out of luck. But when we passed the budget here and we passed a stimulus package out of the House of Representatives, we could find $25 billion to give back taxes to the major corporations of this country, who have been paying them since 1986. We had the money. We should pass this bill and help these people at Christmas time. It is the American way.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Chairman, I thank the gentleman for the time. I hope the gentleman from New York will understand, but we do not accept his promise. The President promised $20 billion. The Speaker stood right over there and said that when we did the airline bailout bill, we would take care of the workers. Now, there are 8 million people in this country unemployed. There are 137,000 in the transportation industry. What have we done for them? Nothing. There are 136,000 in the hospitality industry, nothing; 57,000 in communications, 226,000 in manufacturing, 14,000 in retail, 44,000 in the service industry, 30,000 Boeing employees are being laid off, and we cannot get any more out of this House than $12 billion out of $150 billion stimulus package out of the Committee on Ways and Means, not directed to any new money. We sent it over to the Senate and that stimulus bill is on life support. We have done nothing for workers in this country. Now, are we in trouble? The overall jobless rate jumped from 4.9 to 5.4 percent in October, in one month. Washington State went from 5.1 percent to 6.1 percent. That is a 20 percent jump in 30 days. New York, Illinois, West Virginia, Texas, do not even have money in their unemployment funds to pay 6 months' worth of benefits, and we have 19 more States that do not have enough for an entire year. That does not reflect the real nature of the problem. Mr. Chairman, we had over the last 10 years such a good economy, we have eroded the funds in every State. Today, The New York Times says, 30 States are looking at cutting their budgets in the next session, or doing it right now. Maine is $250,000, Connecticut just had a session for $300 million. So we are doing it all across the country. My State is looking at a $1.2 billion cut in the State budget. So the government puts the money out, the Governor reaches for it, and it is gone. It is gone in Washington State, it is gone in California. And then the height of this whole financial baloney is that stimulus package we put out of here. Now, the gentleman from New York says it is the only thing we could do. It was the only way we could handle this issue. You voted on the floor of this House to give $25 billion in AMT relief to companies that paid it back to 1986. That $25 billion in and of itself would deal with New York, if my colleagues were serious about New York. There is not a single one of us out here that is not in favor of doing something about New York, and I resent being made out to be me against New York because I argue for the State of Washington, or the gentleman from California (Mr. Miller) argues for California, or the gentleman from Hawaii (Mr. Abercrombie) argues for Hawaii. We are supportive of New York, and we had another way to do it, and my colleagues promised it, the President promised it, the Speaker promised it, and we have not done anything. Now we pass a bill and we say well, we are sorry, but we saw that money there and it had not been spent yet because the Governors in the State legislatures had not figured out how to do it, so we are going to sneak it away before they know it is gone. And we promise you, we will come back and fix it. Nobody in here is going to hold their breath until that stimulus bill passes out of the House. Vote for the Miller amendment.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, the airline security compromise bill is a major victory for the American people, and a crucial beginning to the recovery from the September 11 terrorist attacks. This measure will go a long way toward restoring public confidence in airline safety and shoring up our Nation's economy. I commend the members of the conference committee for providing us with an excellent bill to protect the traveling public. Among the important components of this bill is the requirement that all checked baggage be screened. Past measures have been woefully inadequate, requiring that only a small percentage of checked baggage pass through a screening machine. This bill also provides for the development of an agency within the Department of Transportation that is responsible for all transportation security needs. This includes security on railways, busses, and passenger vessels. Most importantly, security personnel will be required to meet a new higher standard. Virtually all airport security officers will be Federal employees. Only those security firms that meet or exceed the federal standard will be allowed to operate in our Nation's airports. No longer will the lowest bidding security firm be awarded contracts to protect travelers in this country. It is my hope that these measures can be implemented in a fast and efficient manner. Once again I would like to commend the members who worked hard to bring us this compromise bill and to proclaim my support for this measure.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, I appreciate the opportunity to rise in support of this bill. Mr. Speaker, I want to associate myself with the remarks of the gentleman from Louisiana (Mr. Jefferson). I think he made the best case for why the part that I really am most knowledgeable about that goes to this bill is a good change. Sub-Saharan Africa accounts for less than 1 percent of American exports and less than 2 percent of U.S. imports. It is an area where we struggle to have peace. And we cannot have justice without peace. We have to have some economic justice. We are watching the same problems in Afghanistan. We are watching them all over the world, and the whole idea of trade as a mechanism of peace is really very important. Now, the reason we have these AGOA provisions here, there is a slight increase in the amount that they can import to the United States; but basically we are here because when we wrote the bill last year, legislators thought they knew what they were doing. We sent it over to the bureaucracy and Customs wrote the rules so that the Africans could not use the provisions to bring apparel into the United States. So part of this is simply being put in place to clarify what we did last year. I think that if we do not do this kind of thing, we will begin spending our time and energy, we have already watched Sierra Leone, we have watched South Africa, we have watched all those countries that have had troubles, Ethiopia, all of them have had troubles; and what is needed is an economy that gives people a way to make a living, take care of their family, take care of their kids. This is essential as a part of our foreign policy. And I think that if Members do not like what we are doing in a lot of other places in the world, Members ought to be looking at trade as a way to help. Mr. Speaker, I only would close by saying we did not deal with one of issues which is an issue we ought to be thinking about and that is the whole question of Bangladesh. Bangladesh is one of the poorest countries in the world that is being squeezed by all of the changes we have made, and you wind up with a country where women make up about 70 percent of the workforce and suddenly they will be out of work because of competition from other areas. So there is much more to be done in this trade area. Mr. Speaker, I rise today in strong support of H.R. 3009, the Andean Trade Promotion and Drug Eradication Act. In 1987, after serving 15 years in the Washington State legislature, I decided to leave politics. I wanted to continue in public service, however, and I joined the Foreign Service as a medical officer based in Zaire where, for a year and a half, I provided psychiatric services to Foreign Service, AID, and Peace Corps personnel in sub-Saharan Africa. I have witnessed first hand the severe social, health, political and environmental challenges the people of this region face on a daily basis. Increased international trade and investment is a key component leading to economic development and growth in sub-Saharan Africa. Last year, the African Growth and Opportunity Act (AGOA) became law. It is the most significant U.S. policy statement to date on our commitment to assist these countries with their efforts to stimulate economic growth and development in this long-neglected region of the world. Imports from Africa are growing more quickly this year than imports from Asia, Europe, or Latin America, with apparel making up most of this import growth. This investment translates into thousands of new jobs and increased growth for many African economies. This boost comes at a critical time, as African economies are likely to be the hardest hit by the global economic slowdown. AGOA II would: clarify that preferential treatment is provided to knit-to-shape or ``wholly assembled'' apparel articles assembled in beneficiary nations; provide preferential treatment for apparel articles that are cut both in the U.S. and beneficiary countries; ``double'' the apparel cap for apparel made in Africa from regional fabric made with regional yarn from 3 to 7 percent over eight years; and allow Namibia and Botswana to benefit from the ``lesser developed beneficiary sub-Saharan African country'' provision. H.R. 3009 builds on the success of the Andean Trade Preference Act, which is set to expire on December 4, 2001, and builds on the bipartisan success of the Trade and Development Act of 2000--which was supported by an overwhelming majority of House and Senate Democrats, and signed into law by President Clinton. These efforts are critical tools in our efforts to build on our partnerships in the Andean countries, the Caribbean, and Africa, to promote democracy, and to combat illegal drug trafficking in our own Hemisphere. This bill will improve the operation of AGOA and increase sub-Saharan country utilization of the AGOA program. Moreover, the current program excludes many products that are key exports from the Andean region--such as apparel, footwear, and tuna--and are essential to the region's future economic growth and development. It is important that Congress renew the ATPA before it expires, but also to expand the program to provide trade preferences to commodities that are currently excluded. The original ATPA was created to foster legitimate trade-based economic relations between the United States and the Andean region and stimulate legitimate economic alternatives to narcotics production and trafficking there. The ATPA has been a success on both counts, and has helped foster trade between the U.S. and the Andean region that has nearly doubled over the last decade to $18 billion to the mutual benefit of U.S. and Andean businesses. If we fail to take the opportunity to expand legitimate trade links with this region, these opportunities will be lost and the ability to sustain the gains of the past decade will be severely diminished. This bill contains the same worker protections contained in the Trade and Development Act of 2000-- these include the right to form unions, a minimum employment age, a ban on forced labor, and acceptable conditions of work--wages, hours, safety, health, the environment--as well as promoting international obligations to eliminate the worst forms of child labor. These provisions have the support of unions in Andean, Caribbean and African countries. This bill is a grant of conditional trade benefits. Congress sets the term and conditions for expanded trade with the United States, and our trading partners must abide by them--if they do not--they will have these benefits taken away--period. Increase trade with the United States would lead to the building of new textile and apparel factories that would quickly provide jobs to thousands of rural peasants and urban workers. Jobs in these factories would pay wages at higher levels than the national average wage. They would also provide employment opportunities, particularly for women. Throughout modern history, the pattern of economic development in every country has shown that the establishment of a viable textile and apparel industry has always been the first rung on the ladder to creating a modern, industrial economy. The pattern has also shown, that giving women employment opportunities and control over their family's finances is the best way to provide people in developing countries the economic resources to move up the economic ladder and obtain marketable education and training. Increased trade and investment with these developing regions will continue to promote U.S. exports and create jobs here in this country. Enhancing the trade programs will continue to support democracy- building policies and reinforces the United States' commitment to promote prosperity, stability, and democracy in sub-Saharan Africa, the Caribbean and the Andean region. I urge my colleagues to support this important bill.

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, I yield 4 minutes to the gentleman from North Dakota (Mr. Pomeroy).

Mr. McDERMOTT

Mr. McDERMOTT. Mr. Speaker, I rise in support of the Andrews-Rangel substitute. I told a story earlier which sort of makes you wonder about why it is that the employee groups are not here saying this is such a good deal. Where is the AFL-CIO? Why are they not running in here? Why is the AARP not coming in here saying we want old folks to have this investment? Because the bill is not a good one, that is why. Now, the substitute that has been offered, really deals with the four issues that we need to deal with: one is the disclosure of conflicts, and that has to be done in a way that people actually hear it and know what is going on. Under the disclosure requirements contained in this substitute, plan participants or beneficiaries under the plan would receive adequate disclosure of fees and other compensation that would be received by the advisor with respect to the product being recommended. So they would know at the time they are getting this pitch, who is doing what. Secondly, the qualification of advisors. We hear a lot of talk about banks are regulated. Yes, banks are regulated. But the fact is that under the Investors' Advisors Act, that is, the Federal law that controls advisors on money, banks are exempted. So all this talk about banks are regulated, blah, blah, blah, but not in this area. Our substitute closes that loophole. Now, the ability to get some nonconflicted advice, investors should be able to have at least two, one that is selling something and someone who is not selling something. The fourth area is the question of remedies. If someone sells us something, and most Americans do not know what is going on in the stock market, if somebody says this is the thing to buy, and they know that it is about to take a dive, maybe they have even sold short. Who knows? I do not know that. Here is somebody that is gives me that advice. We close that possibility by the conflicted question, and then we give a remedy. Mr. Speaker, to do any less than this is to say to people, yes, we are going to give Members another chance. Maybe Members can get it in the Senate or in the conference committee; or maybe we will pass a bill next year and fix this. This ought to be fixed right now. We have the opportunity. We know what the problems are. We have the chairman suggesting he agrees with the gentleman from North Dakota (Mr. Pomeroy). We should be able to do it. There is a real question here that we cannot do what we all agree from the chairman on down is the thing to do. I urge Members to vote for this Andrews-Rangel substitute, and then we will have a pretty good bill.

Mr. McDERMOTT. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, sometimes when I come out on this floor I think I have entered the French theater of the absurd. We are having a bill brought here to us about financial advice. I remember, when this year started, that we had $5.6 trillion in surplus, and all the discussion was about what should we do with it: Shall we pay off the debt? Shall we save it for Social Security? Shall we save it for Medicare? The decision was, oh, the first thing we should do is give about $2 trillion of it away. We are going to do that with a tax break. We said it is 130 trillion, but it turned out to be more like two, and so we go. We have now spent all the Social Security money. That is the advice we are giving to the American people, and then we say, we want to turn you over to the hands of these nice salesmen, they will take care of you. We have taken away their medical security. We have not even put the money that they contributed into the Medicare program. If we were under ERISA, we would be before the courts for the way we are handling the investments of our constituents. We got so wild around here with our tax cuts and all the problems after they figured it all out, and said, well, we need an economic stimulus bill. So we come out here with a nonsense bill, give it another $161 billion off to major companies in this country. This is our advice to America. This is what we think and then this bill is the follow-on. That nonsense of the stimulus package has run into the ditch over in the Senate. I never thought I would count on another body to save us from ourselves. I know they are going to save us from this bill ultimately. This really looks to me like, the other bill, sort of a fund-raising bill, and when I stand here and think about it and listen to all this talk, I cannot help thinking about my grandfather. He was an Irish immigrant, went to the second grade. He could read the newspaper a little bit and he could sign his name. That was the basis of his education. He was a hod carrier down in central Illinois, and in the 1920s, there was a scam in this country. A guy named Samuel Insull was selling energy stock or utility stock all over the country, and the whole rage in this little town where my grandparents lived, Streator, Illinois, everybody was buying Insull stock, you have got to buy Insull stock, you are going to get rich, real rich real quick. Everybody in the neighborhood was borrowing and putting their money into the Insull business. My grandmother came to my grandfather and said, well, Jim, I think we should buy some of that Insull stock, and he said to her, if this is such a good idea, why are those boys from Chicago down here in the cornfield selling it to us? He did not put any of his money in. He said we have got $500 in the bank. I tell you what, Jane, you can take your 250 and put it in the stock, but I am keeping mine in the bank. She followed his advice, and they had their money when Insull went belly up in 1929, and everybody in Streator, Illinois, lost every blooming dime they had put in it. Investment advice to ordinary people is a big issue. If you are a hod carrier or you are a cab driver or you are doing any one of a number of jobs in this country and you are suddenly faced with this question of what should I do with my money for when I get old and somebody comes to you who has a conflict of interest about it, what do you do at that point? You say to your employer, give me another advisor. The bill does not allow that. It does not say you can give me this guy with the vested interest, but I would also like one who is just sort of on my side maybe, and maybe I can get back at him if he gives me bad advice. We say to the workers of this country, we are going to take this away from you at the very time when we are acting financially as irresponsible as we could be. We are the Congress. If it was run by the House of Representatives, we would be borrowing money right now to give back to the companies of this country $25 billion they paid back in 1986. That is the kind of financial advice we are giving this country. We are saying, well, we are going to stimulate things, we are going to give money back to IBM and Ford and all those companies while they are laying people off. We give $15 billion to the airlines because we do not want them to get in trouble, right, and all those investment people are out there selling those stocks, right, keep buying that American Airlines and United Airlines and all those stocks. So we give them $15 billion. We are going to stabilize it. We do not give one single penny to the workers for their health insurance or for their unemployment, and they lay off 100,000 people in the airline industry, and Boeing lays off 30,000 because when the airline industry goes down, so does Boeing go down and everybody else; but they have still got their 401(k), and we say, well, we are going to give you an advisor to tell you what to do with your money, and that is business. I say this is bad legislation. It looks to me like a fund-raising piece, not a real serious effort to take care of people's investments. If the amendments that were offered here were accepted, all of us would be in favor of it. We think people ought to have advice, but it has got to be advice that is not conflicted, that does not have its own pocket interest, and I think that we will have a substitute offered by the gentleman from New Jersey (Mr. Andrews) and the gentleman from New York (Mr. Rangel) which will fix this bill, but I urge people to vote against the bill. Mr. Speaker, I yield back the balance of my time.