Charlie Stenholm

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, reclaiming my time, my point was this: if we had agreed on a budget with $633 billion in spending, you would have had a very large number of Democrats standing up with you on that. It is too late for that tonight. It is too late for that. What I am saying is, your leadership seems to not be able to learn one constitutional fact: if you are going to beat the President, any President, now or any time in the future, you have got to have 290 votes. In order to get veto override numbers, you have got to work with somebody on this side of the aisle, which you have absolutely refused to even consider walking across the aisle to ask any one of us. And the Blue Dogs have given you not once, not twice, not three times, four opportunities to say, we want to work on holding spending down.

Mr. STENHOLM. I yield to the gentleman from Oklahoma.

Mr. STENHOLM. Mr. Speaker, I did not intend to get into this tonight, but I know my friends on the other side of the aisle are not intentionally attempting to mislead the people tonight, because I know them too well. I have worked with them on too many issues, and I think it is awfully important. Anything I say that any of them wish to challenge me on, I will be glad to yield some time, because I do not want to do that which I accuse you of doing. When we start talking about how much is enough, I believe when we passed the foreign operations appropriation bill, those of you who voted for that voted to increase the caps for spending for this coming year to $645 billion. Now, that is more than the President has requested to spend. Therefore, when you start talking about the budget, the President originally this year called for $637 billion in spending. My friends on the other side said you wanted to hold it to $625 billion. The Blue Dogs suggested a good compromise in between at $633 billion. Our $633 billion got 170 votes. In fact, we had 37 of you voting with us on that. Forty-one more of you and we would not be here tonight arguing about the numbers, because we would have held spending at $633 billion, not at $645 billion. Now, for about 16 years I was in the majority, and many times I voted with you, and I got criticized quite a bit for being the big-spending Congress. Well, I was voting with you. This year I did not vote with you, because $645 billion was $12 billion more than I thought we ought to spend this year. You are the ones that increased it. Now, you can put up your chart. I have got a chart over here that will show absolutely, unequivocally, no matter what you are saying on this, that you will spend more than the President has asked. We can point the blame all we want to.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, if the gentleman will yield, I want to go back again to the gentleman's ``How much is enough?,'' and remind everyone again, that question has been decided. The House spoke by majority will that $645 billion is enough; therefore, it is not a relevant argument. The immigration question is a relevant argument. Davis-Bacon applications to school is a relevant argument. There are other relevant arguments, but there is no argument now, at least on the majority side, and I will say not with me either, because once the House has spoken and it is October 29, we cannot go back and redo the budget. Mr. Speaker, $645 billion is the number, and that is more than the President requested. My only point, had we had this kind of conversation early on and more had joined, as the gentleman from Oklahoma joined with us earlier, we would not be arguing about $645 billion would be enough, we would be arguing that $633, and perhaps we would still be arguing about the other questions, but reasonable people can work those out, and surely our leaders, negotiating as we speak, are finding a compromise on those issues that will be acceptable.

Mr. STENHOLM. Mr. Speaker, if the gentleman would yield again on that point, briefly, it makes no difference what the President says on additional spending, because on the budget Rules of the House, if we spend more than $645 billion, we will have to sequester next year in order to bring the spending back. That is the discipline that we used to have in this body, but we have thrown it out the window for the last 3 years.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, the issue is not how much money. The majority voted last week to increase the caps to $645 billion in spending. That is $13 billion more than the President requested. The Blue Dog Democrats suggested a compromise of $633 billion a long time ago. The majority refused to talk to us. I hope we will stop talking about money. Money is no longer the issue. Because if we exceed $645 billion cap for 2001, there will be sequestration and we will bring all the spending back to $645 billion, which is what the majority has set for the caps, which is way too much spending. So I hope we will stop this misdirected rhetoric tonight. Because that sign there ``how much is enough?'' has no relevance whatsoever to any of the issues that we are talking about because we all agree now that $645 billion is the cap.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, I thank the gentleman for yielding, and I would say this one Member is glad the President is going to veto the tax Medicare bill, because it does not deal adequately with the health problems in my district, in my opinion. In requesting additional spending, I am well aware that we have to find that money someplace else, because no matter how many times we say how much is enough, we have agreed $645 billion is enough. When I say I am glad the President will veto the bill, I hope we will work out a better package for rural hospitals, teaching hospitals, all of the things that need a little better shake in that. I say that realizing we have to take the money from someplace else, and I think the HMOs are getting a little bit too much. I think we can perhaps trim some other places. A very respected Member of the other body has said in this spending $21 billion is very questionable. I do not think that it is wrong for us to suggest a little more on hospitals at home would be a better use of some of that money.

Mr. STENHOLM

Mr. STENHOLM. I thank the gentleman for agreeing. Let me say I happen to agree with you on the Davis-Bacon provisions. I have agreed in the 22 years I have now been fortunate to serve here. I think it is a terrible mistake to include, especially the new provisions that will allow local board decisions to have Davis-Bacon applied. It has nothing to do with prevailing wage. I have always agreed that Federal contracts ought to receive the prevailing wage. But I have spent a good part of my career attempting to first repeal and then reform the Davis-Bacon act, to no avail. But I happen to agree with my colleagues on that. I do not agree on creating a new revenue-sharing program for schools. I think we ought to concentrate the money for school construction. So I disagree with my Republican colleagues on that, but here reasonable people ought to be able to work that out, have the legislative process be allowed to work.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, I oppose this bill precisely for the reasons the gentleman who just spoke says we ought to support it. There is no death tax relief in this bill, and after spending most of the year in here knowing that we could very well have a death tax relief for small businesses, it is not in this bill. There is no marriage tax penalty relief anywhere in this bill, and we spent considerable time talking about that. This bill has the wrong priorities on Medicare relief. I represent a district that is very rural. My rural hospitals need considerably more help than what those who wrote the provisions in this bill are suggesting. The bill also undermines welfare reform by dropping the provision extending transitional Medicaid. We are increasing discretionary spending at a record rate, cutting taxes by $300 billion without dealing with the estate tax, marriage penalty, or enacting other legislation to eliminate the national debt; and it is the wrong thing to do today. Mr. Speaker, we must recognize we have to set priorities. The priorities of the majority are not the priorities of this Member. I urge a ``no'' vote on this bill. I oppose this conference report because it has the wrong priorities in using our limited resources. My priorities are eliminating the national debt, providing relief from the estate tax and marriage penalty, beginning a National Energy Policy, and giving assistance to rural hospitals and other health care providers. This bill does not address these priorities. If this bill is enacted on top of the legislation already passed this year, we will have used nearly $1 trillion on the project surplus over the next ten years this year. According to the bipartisan Concord Coalition, if discretionary spending continues to increase at the same rate is has over the last three years under a Republican Congress for the next ten years, nearly two-thirds of the projected $2.2 on-budget surplus will be wiped out. Under one scenario, there would be just $350 billion in surpluses available for other priorities after we take Medicare off-budget next year. The cost of this tax bill, when combined with the telephone excise tax bill, will consume nearly $300 billion of the surplus over the next ten years, not counting interest costs. Enacting a tax cut as presented will consume virtually all of the surplus available for tax cuts, leaving no room to address other priorities. No room to deal with estate tax. We have bipartisan support for meaningful estate tax relief which would exempt all estates less than $4 million from the estate tax and reduce rates by 20 percent immediately. Nearly half of the Democratic Caucus has cosponsored an estate tax bill that would do that, but the Wall Street Journal reported that the Republican leadership has rejected that proposal because they would rather have a political issue for the campaign instead of accomplishing something on estate tax. No room to deal with marriage penalty relief. This bill excludes many important items that were included in earlier tax bills: All of the tax incentives for domestic oil and gas producers that were included in the Senate bill were excluded for some reason. With all of the talk about the need for a national energy policy, I don't understand why the leadership would oppose efforts to help our domestic oil and gas industry. An important provision for farmers which clarify that CRP payments are not subject to self-employment taxes were dropped from the bill. The bipartisan legislation on Individual Development Accounts which I cosponsored with Representative Joe Pitts, which would help low-income families save money and move into the middle class, were dropped for some reason. While I support the increases in IRA limits to help middle and upper income families save for retirement, I do not understand why the tax credits to help low income workers who most need assistance save for their retirement were dropped. This bill has the wrong priorities on the Medicare relief package. This bill shortchanges the critical needs of rural hospitals, home health agencies and other health care providers. The bill also undermines welfare reform by dropping the provision extending transitional Medicaid, which ensures families moving from welfare to work do not lose health insurance for their children. We are increasing discretionary spending at a record rate and cutting taxes by $300 billion without dealing with the estate tax, marriage penalty or enacting a plan to eliminate our national debt.

Mr. STENHOLM

Mr. STENHOLM. The numbers in our chart represent the original Republican requests, the original President's request, and the Blue Dog request that we have begged and pleaded with those of you on the other side to agree with us on numbers that we could stand together. If we are so concerned about the President's request for spending, why did my colleagues never at one time, their leadership, ever come to the Blue Dogs and say we accept your numbers which is between the President and you. So the point of the gentleman from Georgia (Mr. Linder) is well taken except I think my point still stands. We are spending more because my colleagues have voted for it. Mr. Speaker, I appreciate the gentleman's point he is making because it is a valid point and is one which more people need to understand. But the finger pointing needs to stop. It needs to stop. The problem is not today with the Budget Act, as some would say. The problem is with a leadership in this House that has made the budget process irrelevant by proposing unrealistic budgets, refusing to work in a bipartisan manner on a realistic budget that would have held down spending to less than what the President has requested. That is the problem. As I said this morning, I have no quarrel with the Committee on Appropriations, and I see the chairman here and the ranking member. I have no problem here. Mine is with the process and the finger pointing that has gotten into the political process, which it is ridiculous. The problem is with the leadership of this House. We now absolutely can show big spending originates in the House. Presidents do not spend money. Congress spends money. We are in the minority. I am in the minority. I am a part of the minority party. We cannot be responsible. The majority has to assume that responsibility.

Mr. STENHOLM. I am happy to yield to the gentleman from Georgia.

Mr. STENHOLM. Mr. Speaker, there is an old saying at home, the proof of the pudding is in the eating. Well, take a good look at what we are talking about today. We continue to hear a lot of rhetoric from the other side of the aisle about Republicans standing up to big spending demands of the President and Democrats in Congress. Before my colleagues point fingers about big spenders, they should take a good look in the mirror or better yet at the record. Eight of the nine appropriation bills that Congress has passed so far this year and sent to the President would spend more than the President has requested. The nine bills Congress has sent to the President would result in $11.4 billion in outlays above the President's request. This is the chart. According to estimates of the Congressional Budget Office, the nine appropriation bills that this Congress, under Republican majority, has sent to the President would spend $498.6 billion, $11.4 billion more than the $487.1 billion requested by the President on those bills. I do not know how my Republican colleagues can continue to honestly explain that Democrats are big spenders for asking for $5 billion in additional spending for education when they have already voted for appropriation bills spending $11 billion more than the President has requested. According to one rather prominent Republican who has been a leader in fighting against pork barrel spending, the nine appropriation bills that Congress has sent to the President contain $21 billion in programs and projects which he identified as low priority, unnecessary or wasteful spending for programs and projects that have not been appropriately reviewed in the normal merit-based prioritization process of the Congress. I do not understand how voting to increase spending by $21 billion on programs that some have identified as pork is acceptable, but asking for $5 billion more for education makes someone a big wasteful spender. Everyone who voted for the rule on the Foreign Operations conference report earlier today voted to increase total spending by $13.3 billion in budget authority and $8.3 billion in outlays above the President. Let me repeat that. If my colleagues voted for the rule on the Foreign Operations bill, they voted to increase spending substantially above the amount requested by the President. No Member who voted for that rule can honestly continue to claim that the President is responsible for increased spending. According to the bipartisan Concord Coalition, if discretionary spending continues to increase at the same rate it has over the last 3 years under Republican Congress for the next 10 years, nearly two- thirds of the projected $2.3 billion on-budget surplus everybody has been talking about will be wiped out. I will again say to any of my colleagues on this side, if they wish to challenge me on anything I am saying as to the accuracy and authenticity of what I am saying, I will yield to them. By contrast, discretionary spending increased by just 1.2 percent, the rate of inflation, under Democratic Congresses after the budget was created.

Mr. STENHOLM. That is correct, Mr. Speaker.

Mr. STENHOLM. The original requests, Mr. Speaker.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, I rise in strong support of S. 2733. The bill represents a consensus among processor and producer groups. It will benefit the entire industry. Mr. Speaker, under recently reformed Federal milk marketing orders, monthly minimum prices are determined based on market prices for manufactured dairy products, including nonfat dry milk, butter, cheddar cheese, and whey. USDA determines those product prices by surveying manufacturers. The responses are voluntary and USDA has limited authority to verify accuracy. Mr. Speaker, because the determination of accurate market prices is key to establishing milk orders that are reflective of supply and demand, processors have agreed to subject themselves to the requirements that will result from the passage of this bill. The bill requires that USDA use the current survey format as a starting point for mandating reporting. For many processors, this will mean that little will change with the establishment of the mandatory program. Mr. Speaker, in order to ensure accuracy, the bill allows the Secretary to require that reporting companies make their records available for Department audit. Any willful and intentional violation of requirements to make accurate and timely reports is punishable by a civil fine of up to $20,000 under the terms of the bill. The bill also requires that USDA guard the confidentiality of information from each reporting company. Mr. Speaker, I urge my colleagues to support S. 2733.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, I want to make it clear at the onset that my objection to this rule or to this bill has nothing to do with the Committee on Appropriations. The gentleman from Florida (Mr. Young), the chairman of the Committee, and the gentleman from Wisconsin (Mr. Obey) have done their work. The problem that I have was already mentioned and that is raising the caps on this particular bill. It makes no sense whatsoever. This is something that we should have done 6 months ago and would have avoided the problems that we now have. What are the problems we now have? Eight of the nine appropriations bills that Congress has passed and sent to the President would spend more than the President requested. The nine bills that have been sent to the President would result in $11.4 billion in outlays above the President's request. The discretionary spending caps proposed by this rule would allow Congress to increase discretionary spending above the amount requested by the President, by $13 billion in budget authority and $8 billion in outlays. Now, the blame game has been going on and the finger pointing has been going on for weeks and will continue. But let us be real clear, and anyone that chooses to challenge me on these numbers, I will yield to them. This is the fourth year in a row that the Republican- controlled Congress has passed appropriations bills with higher discretionary spending outlays than the President has requested. Mr. Speaker, although the Republican Congress cut discretionary spending with bipartisan help substantially in 1996, the first year after gaining the majority, total discretionary spending outlays in the 5 years that Republicans have controlled the Congress have exceeded the President's request by $4 billion in outlays. By contrast, the Democratically controlled Congress appropriated less than Presidents Reagan and Bush requested during 7 years of the 12 years in office. Over the 12 years of the Reagan-Bush administrations, Congress appropriated $42 billion less than the President requested. The 106th Congress is on pace to increase discretionary spending by at least 5.2 percent above the rate of inflation. This is the largest increase in discretionary spending. Hear me, the largest increase in discretionary spending since the Budget Act of 1974 was passed. According to the Bipartisan Concord Coalition, if discretionary spending continues to increase at the same rate that it has over the last 3 years under Republican Congress, nearly two-thirds of the projected $2.3 billion surplus will be wiped out. By approving this rule, Congress will be voting to increase the discretionary spending caps for fiscal year 2001 by $96 billion in budget authority and $67 billion in outlays. The Blue Dogs have proposed that in exchange for increasing discretionary spending caps for the next year to a more realistic level, Congress should set new caps to impose meaningful discipline on discretionary spending for the next 5 years and avoid this problem. This is not the Committee on Appropriations' problem. This was a leadership decision. This is not an appropriations problem, this is a leadership problem. By the leadership putting a budget on the floor that everyone knew could not be sustained, we find ourselves in this position here on October 25. The same will occur next year if we do not choose to put some fiscal discipline into how we deal with budgets in this place. The discretionary caps for fiscal year 2001 provided no discipline in the appropriation process, none; and that is why we are here. Now, after fiscal year 2002, the discretionary caps expire. By the way, the caps next year that Congress will be looking at will be $551 billion in BA, almost $100 billion below what we are talking about passing for this year. Now, let me remind everybody again: the President proposed to spend $624 billion this year in BA and $637 billion in outlays. The Republicans suggested $600 billion, which was a ridiculous amount; and they could not find votes on their own side. The Blue Dogs suggested 617 and 733. Now, today, with this vote, everyone that votes for this rule is voting to increase the caps over and above what the President requested and over and above what we would have had bipartisan cooperation for in holding the fiscal discipline in this body. The Blue Dogs suggested a number. The leadership in this House said under no circumstances will we do anything other than what we are wanting. Now this is what they are going to get. They will vote for increasing these caps, and so stop going out in campaigns all over the country and blaming Democrats for being the high spenders. It does not wash. It will not wash. I would be glad to yield to anyone that suggests that anything that I am saying is not 100 percent the truth. Quit talking about big-spending Democrats. Let us start talking about a big-spending Congress. Let us start talking about someone that had a grand strategy that would bring us almost to the election year in keeping us here by trying to come up with a false impression of what the budget will be. Vote against this rule because of the caps, and then let us do our job.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, I thank the gentleman for yielding to me. I thank him for taking this time. I will serve notice to our colleagues that we are going to be doing a lot of talking about this over the next 1, 2, 3, 4, 5, or 6 days. Tomorrow we will pass a rule that will provide for six 24-hour continuing resolutions. Just as the gentleman from Mississippi (Mr. Taylor) has talked very accurately about the last 12 months, what is seemingly passing over this body and the leadership of this House is what we are doing in the next 12 months. The 106th Congress is on track to increase appropriations, spending, for domestic programs at the fastest rate this year since the budget act was first passed in 1974. Now, all year long my friend from Mississippi and I and other Blue Dogs have been on this floor calling for a compromise in the budget that can be supported by both sides of the aisle. The Republican budget called for $600 billion in budget authority and $625 billion in outlays. The President proposed $624 billion in budget authority and $637 billion in outlays and colleague after colleague from the other side of the aisle has bent over speaking and decrying the big spending of this administration. Only yesterday the Senate appropriations committee chairman, Mr. Stevens, proposed a compromise discretionary cap of $637 billion in budget authority and $645 billion in outlays in order to get us out of here. That is $8 billion more than the President has proposed to spend this year. The blame game is going on now. We have heard just tonight from both sides of the aisle about who is at fault and who is doing what, and as my colleague has pointed out, we spent a good part of this year on how big our tax cuts were going to be. Completely overlooked in all of this discussion and debate for the last 3 or 4 months is what we are actually doing on spending. According to the Concord Coalition, with what we are about to do under the leadership of the House, two-thirds of this projected surplus for the next 10 years, two-thirds will have already been spent before we adjourn either Saturday, Sunday, Monday or Tuesday. Two-thirds will have been spent. I do not understand my friends in the leadership of this House that somehow believe that you can take individual spending bills absolutely in a blind trust of just saying because we are doing 13 individual spending bills that the sum total does not add up to what we are talking about tonight; just as my friend from Mississippi accurately points out that we barely ran a surplus this past year, and there is credit on both sides of the aisle that are deserving for that, and I readily grant my friends on the other side of the aisle their share of the credit for that. But I do not understand how we can see some of the charts and posters that we will see over the next several days bragging about this history while at the same time we are spending it for next year. We are going to talk about raising the caps and we are going to try to slip it on to another bill tomorrow, finally acknowledging that the caps that we put in in the 1997 balanced budget agreement were unrealistic. I wish we were going to do more than 1 year. In fact, we will be on the floor tomorrow and the next day and the next day saying, ``Let's put another 5-year realistic cap on spending. Let's not just do it for one year.'' And oh, by the way, when we talk about the spending and the blame game starts around, let me point out, according to Senator John McCain, $21 billion of this $645 billion which is $8 billion more than the President proposed that we spend, $21 billion of that is for add-on earmarks that my colleagues on both sides of the aisle are bragging about on a regular basis. I think it is going to be interesting when the smoke finally clears and we see where that $21 billion was spent, how much that is going to detract from the $2.3 billion non-Social Security surplus that we will have to deal with in the next Congress, and as we listen to both candidates for President, where are we going to find the money to have the tax cuts that one proposes or the spending increases that the other proposes when this Congress willhave already spent the money? And as my colleague from Mississippi points out, we are getting carried away with these surpluses. We just barely got into the black this last year when we consider all of the obligations that we have in this body to future generations.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, I thank my friend, the gentleman from Illinois (Mr. Shimkus), very much for yielding, and I thank him for his extra kind remarks. Mr. Speaker, I would say to the previous speaker, the gentleman from Illinois (Mr. Porter), I have not known Tom as long he has, but I can say that evidently he learned his trade well in the Illinois legislature because he carried that over into the House of Representatives. As a Texan, I cannot say that Tom and I have always agreed on every aspect of agriculture, our States being a little different, the rainfall, climate being a little different, but I believe it would not be an overstatement to say that in the 9 years that I have served with him on the Committee on Agriculture that I cannot think of a time in which we have not been able to find a constructive middle ground. For the last 6 years, Tom has chaired the Subcommittee on Risk Management, Research, and Specialty Crops, and that has been a challenge. Consensus building, though, has been the hallmark of Tom's leadership. His legacy is well established through some very difficult pieces of legislation. Soon after he became chairman, he brought together administration and industry officials to develop a compromise that broke a long-lasting stalemate over the Perishable Agricultural Commodities Act. His work for peanuts, tobacco and sugar farmers have made this Northerner a welcome and well-known guest in rural communities throughout the South. When it comes to promoting agricultural exports, again Tom Ewing has been a leader. Whether it was NAFTA, whether it was attempting and ultimately getting the permanent normal trade relations with China, Tom recognized for his farmers, as most of us who represent rural areas recognize for our farmers, the absolute necessity of increasing trade. Ninety-six percent, for example, of all of the world's consumers live outside of the United States and Tom recognized that and he was a great ambassador for American agriculture. Research is another area of Tom's hallmark, where he has been a very forward thinking member. The promise of our future food and fiber production system depends on having solid research foundation and Tom has been a dedicated member of the House Committee on Agriculture, ensuring that innovations and efficiencies continue to bring forth from our research system. Tom Ewing also deserves a great deal of credit for the enactment of the Agricultural Risk Protection Act earlier this year. He understands the risk that our producers face and his mark on our risk management policy will be long lasting. Finally, Mr. Speaker, Tom made some previously unimaginable strides this year in driving agreements that no one thought could be reached with regard to the Commodities Exchange Act, having fought for that particular piece of legislation for years, but under Tom's leadership the House last week passed by a vote of 377-4 the Commodities Exchange Act, a remarkable achievement. I hope the Senate acts quickly to make this work complete so that it can be a true legacy to Tom Ewing's leadership here in the House. One other comment, as so many of us readily admit that we have over married as far as the better half of our family, certainly Connie and the friendship that Cindy and I have had with Tom and Connie over the years is very indicative that behind this good leader there has been an even better woman, and that is something that many of us appreciate, and I certainly do in Tom and Connie. I want to thank the gentleman from Illinois (Mr. Shimkus) for yielding me this time tonight to say how much this Texan has appreciated, Tom, your leadership in serving in the House and we will truly miss you.

Mr. STENHOLM

Mr. STENHOLM. Mr. Speaker, I yield 1 minute to the gentleman from Maine (Mr. Baldacci).

Mr. STENHOLM. Mr. Speaker, I yield myself the balance of my time. Mr. Speaker, I would just close by encouraging all of my colleagues to support this bill, and again commend the gentleman from Illinois (Mr. Ewing) for his tireless work in putting together a package that has brought three different committees together under a most strange situation, but one in which we do have the opportunity to pass legislation of some extreme importance.

Mr. STENHOLM. Mr. Speaker, I yield 4 minutes to the gentleman from Massachusetts (Mr. Markey).

Mr. STENHOLM. Mr. Speaker, reclaiming my time, I thank the chairman for his answer, and for his work on the bill. I again encourage the support of this legislation. Mr. Speaker, I include for the Record the statement of administration policy in support of the legislation before us. Statement of Administration Policy H.R. 4541--Commodity Futures Modernization Act of 2000 (Rep Ewing (R) Illinois and 3 cosponsors) The Administration strongly supports the version of H.R. 4541, the Commodity Futures Modernization Act of 2000, that the Administration understands will be considered on the House floor. This legislation would reauthorize the Commodity Futures Trading Commission (CFTC) and modernize the Nation's legal and regulatory framework regarding over-the-counter (OTC) derivatives transactions and markets. In so doing, H.R. 4541 also would implement many of the unanimous recommendations regarding the treatment of OTC derivatives made by the President's Working Group on Financial Markets, which includes the Secretary of the Treasury and the Chairmen of the Federal Reserve Board of Governors, the Securities and Exchange Commission, and the Commodity Futures Trading Commission. It is important that this legislation be enacted this year because of the meaningful steps it would take in helping to: promote innovation; enhance the transparency and efficiency of derivative markets; maintain the competitiveness of U.S. businesses and markets; and, potentially, reduce systemic risk. H.R. 4541 would accomplish these goals while assuring adequate customer protection for small investors and protecting the integrity of the underlying securities and futures markets. A failure to modernize the Nation's framework for OTC derivatives during this legislative session would deprive American markets and businesses of these important benefits that could result in the movement of these markets to overseas locations with more updated regulatory regimes. The Administration looks forward to working with members of Congress to improve certain aspects of the bill as it continues through the legislative process. Mr. Speaker, I reserve the balance of my time.

Mr. STENHOLM. Mr. Speaker, I yield 2 minutes to the gentleman from Michigan (Mr. Dingell). (Mr. DINGELL asked and was given permission to revise and extend his remarks.)

Mr. STENHOLM. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise in support of H.R. 4541. It is an important piece of legislation and has a number of components that will improve the business environment for the derivatives portion of our Nation's financial services industry. While I support the bill, I do have some reservations. Mr. Speaker, in its early stages, this bill was built from agreements developed between regulators and the President's Working Group on Financial Markets; between the over-the-counter derivatives industry and our futures exchanges; between the Securities and Exchange Commission and the Commodity Futures Trading Commission; and between the three committees of jurisdiction. Mr. Speaker, for a time, the bill's development was the focus of a bipartisan group of members from the three committees that conducted the committee markups; but in a bizarre twist, the leadership intervened and decided to substitute partisan negotiations in place of the bipartisan discussions that were already under way and that were yielding productive results. Mr. Speaker, the leadership's partisan diversion in this matter was clearly unnecessary. In my view, it slowed the process of developing a consensus bill, and consequently it nearly cost us our opportunity to move this legislation forward. The process has also had the effect of detracting from confidence in the final product. Nevertheless, Mr. Speaker, the bill tackles and accomplishes the three main tasks that the Committee on Agriculture set for itself at the beginning of this process: modernizing our Commodity Exchange Act regulatory system, providing legal certainty for our over-the-counter derivatives market, and repealing the outdated prohibition on the trading of single stock futures in the United States. Mr. Speaker, I want to compliment the CFTC for their help. The commission deserves special credit for the design of the new futures market regulatory scheme. The bill reforms futures trading regulation by freeing the CFTC from the task of prescribing the rules and procedures that exchanges must follow. With the bill's enactment, the CFTC's primary role will be to examine and enforce trading entities' compliance with core principles of self-regulatory responsibility. Exchanges will be able to design their businesses the best they can, by adopting practices that are in compliance with these principles. The enforcement provisions of H.R. 4541, as reported by the Committee on Agriculture, caused the CFTC to be concerned that it would lack sufficient authority to bring enforcement action against a registered entity that fails to abide by core principles. I am pleased to say that since that time, the bill's provisions have been modified to meet the concerns of the CFTC. At the same time, provisions have been added to clarify that registered entities will have some flexibility in meeting core principles. Mr. Speaker, the bill before the House repeals the outdated ban on single stock futures. We have never had a better opportunity to eliminate this barrier to progress. With all the things we do trade in this country today, not just corn, cotton, wheat, soybeans, interest rates, currencies, sugar, crude oil and milk futures, but futures on heating degree days, on catastrophic insurance and Iowa crop yields and many other commodities, the ban is particularly absurd. Our Nation is the capital of financial innovation; but we ban futures trading on two things, just two things: onions and single stock futures. The agreements in this bill that will allow trading in single stock futures are an important development, and I am grateful for the work of the SEC and the CFTC in developing their agreement. Mr. Speaker, sections 102 through 106 of the bill provide the legal certainty for over-the-counter derivatives recommended by the President's Working Group and sought by the over-the-counter industry. Section 107 is intended to further bolster that certainty with regard to swap transactions. The application of section 107 is limited to bilateral, individually negotiated transactions, not entered into on a transaction facility. Mr. Speaker, as the Treasury Department said for the Committee on Agriculture's record earlier this year, ``The changes resulting from technology, globalization and financial innovation have made it increasingly important that our regulatory and legal framework keeps pace with rapid progress in the marketplace.'' Mr. Speaker, the place of our financial industry in worldwide competition depends on us. We should move this bill forward. I would, however, be much more comfortable if we had been given the opportunity to analyze the bill and expose it to greater public scrutiny. Our work product would benefit, since the issues involved are complicated and very technical in nature. However, I have decided after listening to the regulators and the industry representatives involved that expediency is more important than a careful analytical process. I can easily understand how another decision could be reached on this legislation. Mr. Speaker, despite my reservations, I do want to especially commend the leaders of the House committees who worked on this bill, and particularly recognize the gentleman from Texas (Chairman Combest) for his leadership. Special recognition must be reserved for our subcommittee chairman, the gentleman from Illinois (Mr. Ewing). His leadership over a number of years has been key to laying the groundwork for and designing the architecture of the delicate agreements that hold H.R. 4541 together. He is a true consensus builder, and the bill before us is a tribute to his service. Mr. Speaker, I urge my colleagues to pass this bill, and at this time I ask the gentleman from Illinois (Chairman Ewing) if he will join me in a colloquy. Mr. Speaker, the bill before us seeks to modernize regulation of futures markets by replacing rigid governmentally imposed restrictions with flexible, but comprehensive, core principles that registered entities must comply with in the conduct of administering trading. Does the chairman of the subcommittee agree that the bill is meant to provide this flexibility while also maintaining the ability of the CFTC to compel compliance with their provisions?

Mr. STENHOLM. I yield to the gentleman from Illinois.