Michael Oxley

Mr. OXLEY

Mr. OXLEY. Mr. Chairman, it gives me great pleasure to yield 5 minutes to the gentleman from Nebraska (Mr. Bereuter) who has undertaken a very difficult task and done it superbly. (Mr. BEREUTER asked and was given permission to revise and extend his remarks.)

Mr. OXLEY. Mr. Chairman, I ask unanimous consent that the gentleman from Nebraska (Mr. Bereuter) be permitted to control the time for general debate on our side.

Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I rise today to urge my colleagues to support H.R. 2871, the Export-Import Bank Reauthorization Act of 2001. This is an extremely important piece of legislation for American manufacturers, American workers and the American economy. By reauthorizing the Export- Import Bank, we will demonstrate our commitment to promoting U.S. goods throughout the world. This legislation reauthorizes the Export-Import Bank for 4 years, and makes several important changes in how Ex-Im operates. This is the first major piece of legislation relating to international trade to come out of the Committee on Financial Services. H.R. 2871 was reported by voice vote with strong bipartisan support on October 31 of last year. I am proud of all of the hard work by the committee on this bill, and I would like to take this opportunity to thank the chairman of the subcommittee on International Monetary Policy and Trade, the gentleman from Nebraska (Mr. Bereuter), for his leadership and dedication in crafting this bill. The gentleman has invested a lot of time and energy ensuring that Export-Import Bank remains true to its mission of supporting U.S. exports and sustaining U.S. jobs. Mr. Chairman, reducing the trade deficit is critical to aiding the economic recovery of the United States. Our manufacturers currently face stiff competition from foreign companies seeking to expand the sale of their goods overseas. There is little argument that goods made in the U.S. are of the highest quality and are in great demand. At the same time, however, foreign companies are getting lots of assistance from their export credit agencies in finding markets and negotiating prices for their goods. Without Ex-Im, U.S. importers would be forced to compete in this international marketplace with one hand tied behind their backs. Ex-Im levels the playing field of international trade by allowing U.S. companies to compete on the quality of their product. In a perfect world we would not need export credit agencies and the free market would operate without market distortions. However, because foreign governments are in the practice of aiding their manufacturers through export credit agencies, the United States must fight fire with fire. Ex-Im works to ensure that U.S. manufacturers receive equal treatment and serves to promote U.S. exports overseas. Currently some 70 governments around the world have export credit agencies like Ex-Im providing about $500 billion a year in government-backed financing. Mr. Chairman, as long as foreign governments are financing export credit agencies, we must support Ex-Im to ensure that our manufacturers and workers remain competitive in the global marketplace. Increasingly, financing is a key to winning export sales. In many emerging markets, where the greatest export growth opportunities now exist, commercial banks are often unwilling to provide financing, even for creditworthy customers. In those cases, government export credit agencies step in to finance the sales, either through direct loans to the customer or through guarantees and insurance that a commercial lender will be repaid by the customer. With guarantees and insurance, commercial banks are willing to provide financing. A key role that Ex- Im plays is to help open markets to U.S. exporters and promote follow- on sales. Ex-Im has led the way in several markets, resulting in a return of commercial financing for transactions. A good example is the efforts Ex-Im undertook in Asia after the currency crisis that that region experienced in the 1990s. When commercial banks saw that Ex-Im was able to effectively transact business in this region, they reentered this market, which contributed to Asia's economic recovery. Many critics of Ex-Im claim that it is a giveaway for large corporations. That is simply not accurate, for several reasons. First, approximately 90 percent of Ex-Im's transactions are with small businesses. Those businesses rely on Ex-Im to help them reach overseas markets that they would otherwise not be able to reach. Secondly, while many of Ex-Im's higher dollar transactions go to larger companies, we should remember that those large companies utilize supplies from many small and medium-sized businesses in order to create their products. Finally, Ex-Im serves as the lender of last resort for U.S. exporters when commercial financing is not available for export sales and when the U.S. exporter is confronted with foreign competitors with financing available from their own government. Ex-Im charges interest on its direct loans and premiums for its guarantees and insurance costs that the U.S. exporter usually passes through to its overseas customer. Those charges usually range from 5 to 17 percent of the financing obtained, depending on the risk. From the exporters' and customers' point of view, the bank does not subsidize the cost of financing an export transaction. Ex-Im is no less expensive to use than a commercial bank or other financial intermediary. I will defer to my colleague, the gentleman from Nebraska (Chairman Bereuter), to describe the details of this legislation. However, I would like to highlight some of the key provisions. First, in this bill we seek to greatly expand the use of Ex-Im by small businesses. That is achieved by expanding the required volume of small business transactions from 10 percent to 18 percent, which will ensure that more Ex-Im-related funds are getting to more local businesses. The bill also authorizes more funds to be used to increase small business outreach efforts and improve technology so that more people can effectively use Ex-Im. Second, H.R. 2871 contains strong provisions relating to U.S. trade laws that will ensure Ex-Im adheres to U.S. policies and does not contribute to overcapacity or dumping of goods on U.S. markets. Third, this measure modifies a Tied Aid Credit Program by renaming it the Export Competitiveness Program and Fund and outlining its operation. The Secretary of the Treasury is empowered to establish how this fund will operate and the Ex-Im Bank Board will have the final determination of when the fund is used, thus maintaining the co-equal roles of Treasury and Ex-Im. The fund will be used to combat tied aid, untied aid and market windows, all of which are tools that have been commonly used by foreign governments to subvert export pricing agreements. Finally, H.R. 2871 makes many important policy changes to Ex-Im's charter. The bill contains provisions encouraging renewable energy programs and efforts to combat corruption and terrorism, and requires the Universal Declaration of Human Rights, as adopted by the UN, to be the standard by which Ex-Im's transactions are reviewed. The committee held its first hearing on the reauthorization of Ex-Im one year ago tomorrow. At that hearing the administration submitted its authorization request for a basic 4-year reauthorization. After an additional hearing and intensive investigation, the gentleman from Nebraska (Chairman Bereuter) crafted H.R. 2871 to reauthorize Ex-Im and make important changes in how the bank operates. This past fall the subcommittee and the full committee reported this bill by voice vote with strong bipartisan support. Since that time, the committee and the gentleman from Nebraska (Chairman Bereuter) have been working diligently to remedy some concerns the administration had with the original text. The results of these discussions is the manager's amendment, which makes several technical changes requested by the administration. Mr. Chairman, Ex-Im provides assistance to both large and small corporations across the United States. Without the guarantees, insurance and direct loans provided by Ex-Im, many of those businesses would not reach high risk or emerging markets with their products. As a result, production levels would be lowered, the U.S. trade deficit would be larger and fewer Americans would be employed in high paying manufacturing jobs. Mr. Chairman, I strongly urge my colleagues to vote in favor of U.S. manufacturers, in favor of U.S. workers, and in favor of the U.S. economy by voting yes on H.R. 2871. Mr. Chairman, I reserve the balance of my time.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I ask unanimous consent that the remaining time be controlled by the gentleman from Nebraska (Mr. Bereuter).

Mr. OXLEY. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and to insert extraneous material on the bill under consideration.

Mr. OXLEY. Mr. Speaker, pursuant to the previous order of the House, I move to suspend the rules and pass the bill (H.R. 2604) to authorize the United States to participate in and contribute to the seventh replenishment of the resources of the Asian Development Fund and the fifth replenishment of the resources of the International Fund for Agricultural Development, and to set forth additional policies of the United States toward the African Development Bank, the African Development Fund, the Asian Development Bank, the Inter-American Development Bank, and the European Bank for Reconstruction and Development, as amended.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and include extraneous material on H.R. 2871, the bill just passed.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I ask unanimous consent that the House insist on its amendments to S. 1372 and request a conference with the Senate thereon.

Mr. OXLEY. Mr. Speaker, I offer a motion.

Mr. OXLEY. Mr. Speaker, I ask unanimous consent to take from the Speaker's table the Senate bill (S. 1372) to reauthorize the Export- Import Bank of the United States, and ask for its immediate consideration in the House.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I ask unanimous consent that in the engrossment of the bill, H.R. 2871, the Clerk be authorized to correct section numbers, punctuation, and cross references and to make such other technical and conforming changes as may be necessary to reflect the actions of the House.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, it is my honor today to pay tribute to a distinguished resident of Bucyrus, OH, on the occasion of his 102nd birthday. Myron J. Pittman was born on April 30, 1900, in northwest Ohio. He graduated from high school in 1918, and subsequently went to work for the Ohio State University, checking and reporting on dairy herd production throughout the State of Ohio. Mr. Pittman later attended Otterbein College--until, as he says, he ``ran out of money.'' He moved to Crawford County in the mid-1930s and ran a dairy farm there through the 1960s. At various times, Mr. Pittman also worked as a rural mail carrier and for the Ohio Department of Highways. A dedicated community supporter, he served as a member of the Whetstone Local School District Board of Education for 9 years. Mr. Pittman is a longtime member of Woodlawn United Methodist Church in Bucyrus. Mr. Pittman and his wife Opal enjoyed more than 74 years of marriage before she passed away in 2000. He has two daughters, Mary Gast of Marion County and Barbara Quaintance of Crawford County, and enjoys spending time with his 4 grandchildren and 4 great-grandchildren. Mr. Pittman is in good health and takes no medications. He has a sharp mind, and keeps a close eye on the goings-on in Washington. His voting record is truly inspirational: he has voted in every Presidential election since the Coolidge/Davis contest of 1924. I know that my colleagues join me in saluting Mr. Pittman's contributions to his community and in wishing him a happy 102nd birthday.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I rise today to support the 30-day extension of Ex-Im's reauthorization. Let me take a few minutes to outline for my colleagues why this extension is so critical. Without this 30 day extension, the Ex-Im Bank will not be forced to close its doors, but it will be prevented from doing any new business transactions. What does that mean? It means many U.S. manufacturers will have to sit idle waiting for a full-term authorization, losing millions of dollars in business every day. It means that workers whose jobs depend on exports financed by the Ex-Im Bank will face an unclear future. It means that the international export community will view the U.S. Congress as unsupportive of U.S. exporters and will seek to capitalize by convincing foreign markets that they cannot rely any longer on U.S. manufacturers. I have already received a copy of a letter that calls into question the ability of Ex-Im to transact future deals. That is the international perception. It is critical that we refute that view by passing this legislation. Mr. Speaker, tomorrow the House is scheduled to consider a 4-year reauthorization of Ex-Im that was approved by the Committee on Financial Services in October of last year. That legislation, H.R. 2871, received broad bipartisan support in the committee and was approved by a voice vote. I want to thank the gentleman from Nebraska (Mr. Bereuter), the chairman of the Subcommittee on International Monetary Policy and Trade, who, over the past several months, has worked closely with the administration to remedy some of its concerns related to the original legislation. Many of those concerns have been addressed and will be included in a manager's amendment to the legislation. Mr. Speaker, the Ex-Im Bank is a vital tool for the American exporting community. The Ex-Im Bank provides loan guarantees, insurance and direct loans to U.S. manufacturers that seek to reach overseas markets when there is no available commercial financing or direct competition from another export credit agency. There are over 70 foreign export credit agencies supplying more than $500 billion in financing for international exports. In order to remain competitive in the international arena, U.S. exporters need the Ex-Im Bank to compete on a level playing field. Without Ex-Im, our manufacturers would face an international market full of goods receiving government sponsored support, making it more difficult for them to offer their goods at a competitive price. Additionally, without Ex-Im, it will be more difficult for U.S. goods to reach emerging markets, effectively closing out the opportunity for U.S. businesses to build a customer base in those countries. Let me reiterate, Mr. Speaker we will take up the full authorization for the Ex-Im Bank tomorrow, but today we must extend the charter of the bank for 30 days to ensure that Ex-Im can continue to create new business. I urge my colleagues to join me in voting to approve this 30- day extension of the bank and let the world know that we support American manufacturers, we support American workers and we support the American economy.

Mr. OXLEY

Mr. OXLEY. Mr. Chairman, I want to take this opportunity to clarify several matters on this legislation. First, I want to discuss a specific provision of the legislation. H.R. 3763 provides enhancements necessary to support the Securities and Exchange Commission in its role to protect investors of public companies, including the unique relationships of auditors to the absentee shareholder. It is not intended to extend to auditors of privately-held companies or other, smaller regulated entities. These entities are uniquely different from global public companies in many ways. For example, many of these smaller companies do not have large executive staffs. Instead, they rely on their CPA/auditor to provide objective, trusted advice and counsel on a broad range of tax and business issues. Extending the reach of these restrictions to such firms could create unintended harmful consequences to an important segment of the U.S. economy. It is for this reason that the bill contains section 2(j), clarifying the application of the bill. This section is intended to ensure that public regulatory organizations are properly focused on the auditors of public companies with respect to their audits of such companies. It is not meant to apply to the thousands of American accountants that continue to provide trusted advice to their small business clients. Second, Mr. Chairman, I want to take this opportunity to correct a specific error that appeared in the Committee's report on the legislation. On page 31 of the Committee Report (H. Rept. 107-414), the sponsor of amendment No. 1b(5) is incorrectly identified as Ms. Hooley of Indiana. The correct sponsor should be Ms. Hooley of Oregon. I regret any confusion caused by this error and apologize to the gentlelady from Oregon (Ms. Hooley). Finally, Mr. Chairman, I am including for the Record the cost estimate prepared by the Congressional Budget Office on H.R. 3763. It was not available at the time the Committee's report was filed on the bill, and I am including it here to ensure a complete legislative history for the bill. U.S. Congress, Congressional Budget Office, Washington, DC, April 26, 2002. Hon. Michael G. Oxley, Chairman, Committee on Financial Services, House of Representatives, Washington, DC. Dear Mr. Chairman: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 3763, the Corporate and Auditing Accountability, Responsibility, and Transparency Act of 2002. If you wish further details on this estimate, we will be pleased to provide them. The CBO staff contacts are Ken Johnson (for federal costs), Paige Piper/Bach (for the private-sector impact), and Susan Sieg Tompkins (for the state and local impact). Sincerely, Barry B. Anderson (For Dan L. Crippen, Director). Enclosure. Congressional Budget Office Cost Estimate, April 26, 2002 [H.R. 3763: Corporate and Auditing Accountability, Responsibility, and Transparency Act of 2002, as passed by the House of Representatives on April 24, 2002]

Mr. OXLEY

Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, the amendment before us requires audit firms to establish and maintain huge capital reserves, at least 50 percent of annual audit revenue. The Sherman amendment was offered in committee and defeated by an overwhelming margin of 49 to 9. Though well intentioned, it would establish a burdensome and wholly unprecedented requirement, expanding government's reach into the financing and structuring of audits firms. Minimum capital requirements would harm small audit firms in particular and would result in less stability for public companies, higher audit cost for public companies, lower profits for investors, and more speculative lawsuits. Clearly this is a case of using a sledgehammer to crack a nut. I urge all Members to oppose this amendment and support the base bill. Mr. Chairman, I reserve the balance of my time.

Mr. OXLEY. I am prepared to close.

Mr. OXLEY. Mr. Chairman, I am pleased to yield 1 minute to the gentleman from New York (Mr. LaFalce).

Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume. Today, the House turns to H.R. 3763, the Corporate and Auditing Accountability, Responsibility, and Transparency Act. To my colleagues on both sides of the aisle, today we must act. We must act for our Nation's investors, retirees, and employees of publicly traded companies; and that covers a large majority of Americans. In recent months our struggling economy has absorbed a number of shocks. We have endured two large bankruptcies, Enron and Global Crossing. Thousands of jobs have been lost for hardworking employees. Billions of dollars are gone from investment portfolios and retirement plans. Investor confidence has understandably wavered. Congress has examined these issues for 4 months. The Committee on Financial Services alone held seven hearings, took testimony from 33 witnesses; and we are but one of many panels. We know now what happened, and we know what needs to be done. Now it is our responsibility to do something about it. We owe action to the American investor who faithfully puts away money every month in his IRA or his 401(k) plan. We owe action to the employees who lost their jobs, and we owe action to all of the American companies who are operating in good faith and working to grow. I would like to say a word of thanks to the President and his staff for all of the support and encouragement we have received throughout the process of drafting and moving this bill. His 10-point plan was very much on the same track as our bill, and the White House has helped us improve the bill every step of the way. I also want to say a word of thanks to the 16 Democrats who voted for the bill on final passage in the Committee on Financial Services. We appreciate their support for our sound legislative bipartisan product. President Bush has asked us to move on his plan; and clearly, this is a national priority. We need to encourage greater corporate responsibility. We need to strengthen and modernize our accounting oversight, and we need to make sure that investors have timely and clear information. There is a real urgency. We cannot undo the past, but we can help to prevent future Enrons and Global Crossings; and we ought to do just that today. In our zeal to act, we can easily do more harm than good. It is easy to do something extreme. We can easily smother American businesses with red tape. We can punish those who have done nothing wrong. We can damage the capital markets and the economy in the process. I say let us do the difficult thing. Let us accomplish something that is worthy, as the President has charged us, and CARTA strikes that balance. CARTA recognizes the need for corporate leaders to act responsibly and holds them accountable if they fail to do so. CARTA ensures the highest standards of auditor independence, ethics and confidence and establishes a public regulatory organization for accountants of publicly traded companies, something that has never been done before. CARTA improves corporate disclosures by requiring companies to provide the public with more information about their financial condition. CARTA makes important improvements in the area of corporate transparency, requiring that companies disclose to investors important company news on a real-time basis. CARTA also directs the SEC to require greater disclosure for off- balance sheet transactions. I am confident that we are striking the right balance, particularly when it comes to the role of the Securities and Exchange Commission. CARTA gives the SEC the flexibility to deal with problems without legislating every time. Congress created the SEC precisely to deal with situations like this. We need to empower the SEC to act without tying its hands and within flexible statutory changes. Let us remember that a strong regulator is not one that is completely dictated to by Congress. A strong regulator has some say over his jurisdiction, some power and discretion to shape the capital markets; and I trust the SEC with this authority and so does our bill. CARTA makes it a crime for anybody to interfere with a corporate audit. It requires CEOs and other corporate insiders to disclose within 48 hours when they sell company stock so that investors and employees and retirees know if a corporate officer is getting out. It prohibits insider sales of company stock while the employee retirement plan is locked down. Strengthening these areas of corporate responsibility, accounting oversight, and investor information is an important priority as our economy recovers. Let us show the American people that we can respond in a meaningful way to their very real economic concerns. Pass CARTA today. Mr. Chairman, I reserve the balance of my time.

Mr. OXLEY. Mr. Chairman, I am pleased to yield 3 minutes to the gentleman from Michigan (Mr. Rogers), a valuable member of the committee.

Mr. OXLEY. Mr. Chairman, will the gentleman yield?

Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentlewoman from New Jersey (Mrs. Roukema). (Mrs. ROUKEMA asked and was given permission to revise and extend her remarks.)

Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentlewoman from Illinois (Mrs. Biggert), a valuable member of the Committee on Financial Services.

Mr. OXLEY. Mr. Chairman, I yield 3 minutes to the gentlewoman from Pennsylvania (Ms. Hart), an outstanding member of our Committee on Financial Services.

Mr. OXLEY. Mr. Chairman, let me commend my friend, the able gentleman from Texas, for his good work on the committee and on the floor. The committee will certainly miss his excellent leadership and insights next year. I wanted to pass those remarks along. Mr. Chairman, I yield 4 minutes to the gentleman from Louisiana (Mr. Baker), the lead cosponsor of the CARTA legislation and the chairman of the Subcommittee on Capital Markets.

Mr. OXLEY. Mr. Chairman, I am pleased to yield 3 minutes to the gentleman from Alabama (Mr. Bachus), a subcommittee chair.