Jeff Sessions

Mr. SESSIONS

Mr. SESSIONS. Mr. President, I want to express my congratulations to Papa Dodd on his new daughter, born this week to join her sister Grace. We wish Jackie and the family well. I know how excited he has been over young Grace. I know how excited he is over this one. He said he lost a lot of sleep this week, he is a little tired, but he looked pretty vigorous to me in debate. I wish my sincerest best to you, and my wife Mary sends her regards, too. I am disappointed Senator Dodd is not supportive, as I understand it, of this bill. It is essentially the same bill we passed during the 107th Congress, 83 to 15. It came out of committee with a strong bipartisan vote again this year. This is the fourth time it has come up. It passed one time 97 to 1 in the Senate. This is the fourth time it is up. I believe it will become law this year. I want to say there are some things here that my good friend has stated that are just not correct. I hope really he will think about and reevaluate some of his conclusions on the legislation. I have to say, there is a small group of leftists who are determined to block this bill. They seem to believe there is something wrong if a corporation, even a credit card company, gives money to an American citizen for them to want to be paid back, and if they don't pay it back, it is the credit card company's fault. They lose their money and they are an evil force here. This is really an odd argument, I suggest. I also argue, flatly state, that I disagree with the statement that the only purpose of this bill is to help the credit card companies make money. That is absolutely not correct. It is really offensive to suggest that to the 83 Members of this Senate who have been working on this bill for quite a number of years. Let me say a couple of things that I believe are indisputable. Philip Strauss, attorney for San Francisco Child Support Services, for 28 years enforcing child support obligations, testified before our Judiciary Committee, of which I am a member. I want to deal with some allegations that have been floated by--I think primarily it is the Elizabeth Warren view of this bankruptcy bill. In an effort to smear the bill and defeat the bill, they have conjured up this idea, somehow, that children and spouses are going to be harmed by this bankruptcy bill. It is absolutely incorrect. It is abysmally wrong. Let me tell you what this expert said. It is my opinion and the opinion of every professional support collector with whom I have discussed the issue that the support amendments contained as part of the bill, contained in section 211-219 of S. 256, the bankruptcy bill, will revolutionize enforcement of support organizations against debtors in bankruptcy. Child support obligations will be revolutionized. This legislation has been endorsed by the National Child Support Enforcement Association. Maybe some of those who have been saying this hurts children ought to interview the professionals--the National Association of Attorneys General, the National District Attorneys Association, both of which have important roles to play in collecting enforcement obligations for children--child support. Mr. Philip Strauss, the attorney who spent 28 years in bankruptcy court collecting these debts for women and children against spouses and deadbeat dads who bankrupt against their debts, had this to say. The provisions in the bill are ``a wish list for child support attorneys.'' That is what he has been looking for. Under the current law, if we don't change it by passing this bill, the law that will remain in effect has alimony and child support payments No. 7 on the list of priorities for paying nonsecurity debt-- No. 7 in the list. We moved it up to the top. Everybody who knows anything about this bill knows that women and children and their alimony and child support is going to be secured in a way it never has been before. It is offensive what Professor Warren is saying about this bill. This college professor keeps writing things that are not so. I don't know how--I guess she has tenure. She also is the one who has gone around this country and promoted the idea, and had a press conference a few weeks ago, to announce that medical bills are the cause of everything. She says that all the people filing, half the people plus, 54 percent of the people who file bankruptcy are in bankruptcy court because of medical bills. What do we know about that as a fact? She had a survey that indicated that. Do you know what we discovered, when you read the fine print of her survey? It includes gambling debts. It includes alcoholism and drug problems. This is what the United States Trustee Program found in a much more extensive survey. Hers I believe had 1,700 people. This one has 5,203 cases. U.S. trustees are involved in bankruptcy courts in 48 States. They deal with these cases. They were asked to survey the filings in their districts to find out what you list on your filing as your debts, who you owe. You actually list who it is. So, if it is a doctor bill, it is on there. If you don't put it on there you don't wipe out that debt and you remain obligated to pay it, so everybody puts every debt they have on the list so it can be wiped out when they file bankruptcy. What they found was, this professional study of 5,000 cases, not interviewing debtors but looking at what they put on their form, they found that only slightly more than 5 percent of the total unsecured debt reported in those cases was medically related. Only 5 percent was medically related. This is not 50 percent of the cases in bankruptcy being caused by medical--only 5 percent of them, of the total debt, was medical. It also revealed that 54 percent of the debtors, when they list all their debts, and they have a long list of them, listed no medical debts whatsoever. And of the people who listed some medical debts, 90 percent of those who listed a medical debt listed a medical debt of less than $5,000. For some people there is no doubt that medical debts are a cause for bankruptcy. I do not doubt that. But this idea that we ought not reform bankruptcy, that we ought to assume that there is no fraud and abuse in bankruptcy and the idea that everybody is in bankruptcy because of medical debts is just not so. It is just not; it is a fiction. We need to get it out of our heads. There is another suggestion that poor people are going to have to pay back some of their debt. This is ``pressure on poor people,'' they say; ``this is class warfare.'' Poor people now are going to have to pay back their debt, and they are going to be harmed. We discussed the problem in bankruptcy. The most offensive, clearly wrong thing about the current bankruptcy problem in America is that people making $200,000 a year, if they run up a couple hundred thousand dollars in debt, those people do not have to pay a dime. They can wipe out the entire debt. Shouldn't they pay some of it back? The average American citizen works hard to pay his or her debts back. They save; they do not take vacations; they do not buy a new car, they buy an older car so they can pay their debt. Some doctors, lawyers--we have examples of them--know how the bankruptcy works. They do not want to pay their debt. They wipe them out when they could easily have paid them back. We reached a bipartisan consensus to have a means test which received 83 votes on the floor of the Senate the last time. If you make below median income your State, then you don't have to pay anything back. Eighty percent of the people make below median income. Some people who make above median income have special expenses, and we allowed them to take an exception. It really looks as though maybe only 10 to 13 percent of the people who file bankruptcy would be impacted by the means test. The wealthy, why shouldn't they pay? I ask you, why should somebody not pay the local hospital when they have plenty of money with which to pay their debts? What happens if you make median income and you don't have special circumstances? What should happen? I think you ought to pay some of it back. That is what the American people think, and that is what this Congress thinks. What would happen is this: They would move into chapter 13, the bankruptcy chapter, which allows for repayment of a portion of the debt. The judge would look at the person's income, how much he believes they can pay back over a period of no more than 5 years, and order them to pay back some portion of those debts. What is wrong with that? I hear my colleagues complain about the bill saying: I don't mind rich people paying back. That is what the bill does. It creates a safe harbor, an absolute wall for lower income people, people making below median income in America. Eighty percent of the filers of bankruptcy don't have to go into chapter 13. They don't have to pay a dime back. Let's just say this: Chapter 13 is not so bad. It has a lot of sanctions. You can keep your car and ``cram down'' the value of that car, hold on to your house better, and other things that sometimes are an advantage. A lot of States use chapter 13 a lot. In Alabama, almost half of the filers are chapter 13 filers. Just because somebody is going into chapter 13 and pays some back does not mean they are being oppressed. ``Oh, you know.'' Well, we are going to complain about credit cards today. A couple of days ago, it was about health insurance, we need to reform health insurance. If we reform health insurance, they argue, we wouldn't have bankruptcy. If we don't fix credit cards and interest rates and truth in lending and banking issues--they are not part of the Judiciary Committee but part of the Banking Committee's financial lending portfolio of issues-- we have to deal with them. We can't deal with bankruptcy. This is a bankruptcy bill. This bill would create a workable process for filing bankruptcy in Federal court, so fairness occurs based on the debt that people have incurred. If you want to deal with the debts being incurred and giving more money, or have a welfare increase, whatever you want to do, let us propose that somewhere else to give people more money. But once they choose to file bankruptcy, let us create a system that is fair. Let us say that people who have higher incomes and can pay back some of it, why don't they pay it back? That is what I think we ought to do. It has been suggested. We have a lot of complaints. Members of this body like to talk about some minor child getting a credit card. Let me say that any minor in America who gets a credit card and goes down and runs up $5,000 worth of bills on that credit card does not have to pay a dime. The company that wrongly sent them that credit card eats the $5,000 loss because you can't sue a minor on such a debt. They can't be made to pay it. Who is the loser, if they sent a credit card to some young person and they used it, but the credit card company itself? That is not the issue before us. Let us fix this bankruptcy bill that allows too much abuse, too much legal cost for people who go to court. Let us keep the legal fees down. Let us make the system fairer. Let us make sure the great protections of a fresh start for Americans is still alive and well. And for those median income and below, there is no change fundamentally in this bill whatsoever except they have to have some financial counseling, some credit counseling, and they can start all over again and wipe out all of their debt. But if they make above that and can pay some of it back, let us have them pay some back. I don't think that is unfair or unusual or upsetting to most people who considered the bill, and that is why we have had such good support for it. There was some suggestion that we have seen some reduction in filings. I hear 50,000--50,000 off a number of 1.6 million. About a little over 20 years ago, in 1980, there were 287,000 bankruptcy filings a year. Now they hit 1.6 million, and there is the suggestion that because it has dropped to 1.5, that somehow we ought not to fix this system that we know from experience--and we have been watching it for some time as a problem. Let us fix this problem. Whether it is 1.2 million in bankruptcy, 2 million in bankruptcy, we have a problem with the system. Let us fix it. Let us treat people fairly. If you can pay some of it back, you shouldn't get off scot-free. If you make below median income, you get to wipe out all of your debts and not pay a dime to the people you owe unless you intentionally and deliberately inflict harm on that. It is the same law we have always had. Those debts are not dischargeable in bankruptcy. Mr. President, I ask unanimous consent to have printed in the Record a letter from the Department of Justice on the data they have obtained from the U.S. Trustees on the issue of medical debts, and I commend to my colleagues the February 10, 2005, testimony of Philip Strauss before the Senate Judiciary Committee on the benefits of the bill to women and children which he states is indisputable and represents a wish list of items of those who collect child support for women and children.

Mr. SESSIONS. Mr. President, I thank the Chair. I yield the floor.

Mr. SESSIONS. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. SESSIONS. Mr. President, I am pleased we have had a good week of debate on the bankruptcy bill, which I believe is a very important piece of legislation. It is something this Congress has a responsibility to deal with since bankruptcy procedures are Federal court procedures and bankruptcy judges, although not article III judges, are Federal judges. The court system, over the last 20, 30 years, has grown incredibly. We have gone from a few hundred thousand bankruptcies a year, to 1.6 million personal bankruptcies in 2003. It has been driven by a lot of things. Some say it is economic problems, but our economy compared to other times has not been as bad. We have had some tough years, but we have also had some good years. We have seen bankruptcies exceeding everything that could be based on the economy. I suspect a good part of it is because of the advertising of lawyers in the newspapers. People who have built up some debt and are having a hard time dealing with it, and creditors are calling, they see an ad that says something like this: Come on down. We can take care of those debts and help you. So people have been filing bankruptcies at a record pace, caused somewhat by these ads. Many of the people work their way out of it; many of them cannot. We absolutely believe and support the classic American view that you should be able to have a fresh start; that if debts overpower a family or individual, they can go to bankruptcy court and wipe out those debts and not pay a dime. That is the way the law is, no matter the income of the person who files. A person who has a quarter of a million in income today can go into bankruptcy court, if they have, say, $150,000 in debts, debts they could pay if they put their mind to it, they can just wipe out those debts and keep making $250,000 a year and not pay their local banker, their local hospital, doctor, car dealer, or whoever they bankrupt against. It is an unhealthy practice. We thought a lot about how to deal with the problems and how to deal with the abuses. Having practiced law a good bit, I have a hard time blaming the lawyers who take advantage of the laws that we in Congress have provided. They look at the legal system, they see what helps the debtor the absolute most, and they file the bankruptcy in that fashion, taking full advantage of the law. It is appropriate for the Senate, for the first time since 1978, to pass a reform of those laws to deal with the problems we know arise, to help people who legitimately need relief from their debts to start afresh. Those who can pay some of it ought not to get off scot-free. That is the fundamental principle of this bill. Let me mention one of the best things about bankruptcy. When people fall behind in their debts, penalties get assessed against them. They have to take out even higher interest rate loans to stay afloat, and they begin a downward spiral. They have creditors--in most instances, many creditors. These creditors call debtors, they file lawsuits and they file liens against the debtor's property. It can be a crushing, hard time for them. When they file bankruptcy--either in chapter 7 where all the debts are wiped out, or in chapter 13 where they pay back a portion of those debts--the creditors cannot keep bothering them. They cannot be sued. Any lawsuits that have been filed against them are stayed, stopped. The court manages their money under chapter 13. They wipe away all their debts if they file under chapter 7, and they can start afresh. That is a provision of law in America that is worthy of continuing. But we also see there are some problems and abuses. As we look at the changes in this legislation, I will mention a few as we get started this morning. One is there was a consensus of those working on the bill that if individuals had a higher income and could pay back a portion of their debts, at least--perhaps all of them, but most likely not all of them-- they ought to do so. Why should they not pay back something if they are able to do so? So we put in the bill a means test. This has been in the legislation for the last 8 years. It has come before this Congress four separate times. This is the fourth time. And it has received a strong majority vote, bipartisan vote every single time. But for one reason or other, we have not been able to make the bill law. We are going to do that this time, I am confident. But on the question of, What about the changes? How does it impact a person who would go and file in bankruptcy? We know that 80 percent of the people who file for bankruptcy make below median income. That means under the provisions of this bill, no fundamental changes will occur. They cannot be made to go into chapter 13 unless they choose to do so. They can wipe out all their debts, not pay a single one, under the provisions of chapter 7, unless it is a debt that is not dischargeable, such as a result of an intentional or fraudulent act. If they make above median income, and there are no special circumstances that apply that might excuse them from that, such as a health problem or a problem with an ill child or something that requires extra expense, then they could be moved into chapter 13, where they pay back a portion of their debts. The judge would decide how much they could pay, and they could be made to pay a portion of those debts for a period of up to 5 years. We think that is a reasonable and fair approach. In fact, this Senate certainly did during the 107th Congress when we passed a similar bill 83 to 15. So I think that is the basic procedure. It also provides that before you file in bankruptcy, you should at least examine the possibility of credit counseling. There are credit counseling agencies all over America. They have proven to be effective for a large number of creditors. These agencies are able to negotiate reduced payments for the debtors, to reduce interest rates and to help the debtor sit down and work out a family budget. They bring in the whole family. They sit around the table. They work out a budget. They help teach them how to manage their money. They reduce interest rates. They reduce debts through negotiation. Many families are finding they can work their way out of debt without filing for bankruptcy, without walking out on their solemn obligations and actually feeling better about themselves, as well as learning a lesson for the whole family. So we say they at least ought to know about this option and ask them to consider that. It can be to go by and have a brief meeting, a discussion, and receive some paperwork on it, and discuss it before they file for bankruptcy. We think that can make a big difference for a lot of people. How many bankruptcies might be avoided by that? I don't know--5 percent, 10 percent--but I think it could be a significant improvement in our system. We also say that before you can be discharged and finally walk away from your debts, you should go through a financial course on how to manage money because we want to see people manage money wisely, to avoid high interest debts when they can, to keep their interest rates low, their borrowing low, to manage their money wisely. This bill would also require that. These are things that have gained strong bipartisan support. I know I offered the amendment on credit counseling. I visited credit counseling agencies in Alabama and talked to them. I think they provide a tremendous service for a lot of people. That is where we are with the fundamentals of the bill. It has, as I said, come before Congress four different times. In 1998, during the 105th Congress, we passed the bill with a 97-to-1 vote. The most recent vote, as I noted, was in 2001, and it was 83 to 15. We reported this bill out of the Judiciary Committee last week with a vote of 12 to 5, with strong bipartisan support again. So we are confident that if we go forward and we have an up-or-down vote on the bill, it will pass. I believe the House of Representatives will pass it again this time, and we can make some progress in that Federal court system that we have the responsibility to monitor. We have the responsibility to analyze it on a regular basis, and if it is not performing up to standards, we ought to fix it. That is what we are doing. We have had a surge of bankruptcies. We have had a surge of abuses in bankruptcies where people, for example, lawyers, run ads in newspapers saying: Are you about to be evicted from your apartment? File bankruptcy. Call us. And they have their phone number there. People are filing bankruptcies to stay an eviction for not a house they own but an apartment. That is not legitimate. So when the case is heard in the bankruptcy court, the apartment owner, who oftentimes is a small businessperson or retiree, has to go down to bankruptcy court, hire a lawyer, and then they win because the debtor does not have any property interest in the apartment. The lease has expired. They owe money on it. They are due to be evicted. Then it comes back to the State court for eviction proceedings, and they have to pick that up again. And they extend, for months, their stay in people's houses or apartments through the manipulation of the bankruptcy system. That is one of the things we tightened. We raised the priority for women and children with regard to alimony and child support. Those payments are going to be far more high on the priority of payments when there is a limited amount of money by the debtor. So now, instead of money going strictly to lawyers or to other debts, it is going to go straight to children for child support and also for alimony. We had testimony in the Judiciary Committee, of which I am a member, from professionals in child support who say this will be a magnificent advance for women and children. We are excited about that potential. There is so much more in the bill. I believe it is a sound bill. It has been on this floor, as I said, four times. It has been in the Judiciary Committee four times. We have had 15 hearings on the bill. I believe every possible objection has been considered, and I believe we are on the verge of making some positive change in our bankruptcy system. It is certainly overdue. I yield the floor.

Mr. SESSIONS. Senator Alexander, I appreciate your remarks, having been a U.S. attorney involved in urging certain consent decrees and having been an attorney general and seeing it from the side of the State. My question is this: What your legislation would do is provide a mechanism to guarantee a periodic review of a consent decree so it would not continue indefinitely. There are many in this country that are well over 20 years in which judges are intimately involved in details of governing and the local people have to seek approval for any of the most minute changes. This would not eliminate consent decrees. It would not eliminate their enforcement, but it creates a mechanism by which they are periodically reviewed so as to determine whether they should be extended.

Mr. SESSIONS

Mr. SESSIONS. I would like to comment on Senator Corzine's amendment No. 32 to exempt ``economically distressed caregivers'' from the means test. I remind all of my colleagues that people who are economically distressed and have incomes below the median income already will be exempt from the means test. Secondly, I point out that page 10 of the bill is explicit that expenses people incur for the care and support of an elderly, chronically ill or disabled member of their household or family is subtracted from their income, even if they have very high income. This means that the bankruptcy bill we have drafted will still allow people who take care of their sick and aging family members to file for bankruptcy under chapter 7, the chapter that allows you to completely wipe out all your debts. Let me read directly from page 10 of the statute. In other words, the amendment is covered by the legislation. It came up in committee. We talked about it, and it was adopted. When we talk about monthly expenses, you are trying to determine if your income level exceeds median income level and whether you can afford to pay anything back if you owe some of your debts and you have a higher income. So it reads: In addition, the debtor's monthly expenses may include, if applicable, the continuation of actual expenses paid by the debtor that are reasonable and necessary for the care and support of an elderly, chronically ill, or disabled household member or member of debtor's immediate family (including parents, grandparents, siblings, children, and grandchildren of debtor, the dependents of the debtor, and the spouse of the debtor in a joint case who is not a dependent) and who is unable to pay such reasonable and necessary expenses. So we have dealt with that. We tried to consider these things and be reasonable as we calculated this. There was a concern expressed in committee that people might not be able to pay back any of the money because they have debts as a caregiver. That is taken care of already in the statute.

Mr. SESSIONS. Mr. President, there is a great deal of misinformation out about the impact of health care expenses on bankruptcy. Let me just say what the Department of Justice, U.S. Trustee Program, has found by examining 5,000 petitions, where you state exactly what the debts are, that 54 percent of the bankruptcies do not mention health care at all. They say, of the ones that mention health care, only 10 percent show it over $5,000. And of the total debts shown on those forms, only 5 percent represent health care debts. That is No. 1. No. 2, this bill absolutely protects people and allows them to bankrupt and wipe out their medical debts. If you are below median income, all of it is wiped out. If you are above median income, you may have to pay back some of it. But I say, why should you not pay your hospital if you can? I ask that we vote no.

Mr. SESSIONS. Mr. President, this is an amendment that is unjustified, incredibly unjustified. It basically says if you take off one month from work to take care of a family member in need, you can never be put in chapter 13 and pay back some of your debts, even if your income is $500,000 a year. I think Senator Leahy offered the amendment in committee. On page 10 it says: (II) In addition, the debtor's monthly expenses may include, if applicable, the continuation of actual expenses paid by the debtor that are reasonable and necessary for care and support of an elderly, chronically ill, or disabled household member or member of the debtor's immediate family (including parents, grandparents, siblings, children and grandchildren of the debtor, the dependents of the debtor, the spouse . . . And so forth. It is provided for in the bill. This amendment will give an absolute exemption no matter what the person's income is. It absolutely should be voted down.

Mr. SESSIONS. Mr. President, I thank Senator Feinstein for her comments. As I see it, we have probably a couple of little difficulties with amending the Truth in Lending Act--the Banking Committee has jurisdiction over that--how we will go forward. I do agree with the Senator from California that the plain fact is that credit card companies have an interest in getting reliable credit card holders not to pay on time--because they would be making 18 percent or whatever percent interest--if they are reliable people and they pay their debts. So I think sometimes their disclosure is not clear enough on the minimum payment. They put the minimum payment in big print and the total amount due is printed small because I think sometimes they don't really want people to pay it early. Some attention should be given to that, and I would consider their amendment. Let me repeat what we are about here. We have been hearing all day, virtually, about health care bankruptcies as if this bankruptcy bill does not provide relief for people who have health care debts. It certainly does. What we are about is to reform the procedure of Federal bankruptcy courts in America. All over this country there are Federal courts, bankruptcy courts. They handle the petitions of people who have incurred debts that they say they are unable to repay. They would like to wipe out those debts, not owe anybody anything. Stop the phone calls, stop the lawsuits--nada--not pay what they owe. We provide for that. As has been stated before, the last numbers we have, 1.6 million people have filed that way. I would say without doubt that a number of those people who have filed, quite a number, really needed that relief for whatever reason. They got themselves in serious financial trouble. It is interesting that people who manage their money well are very careful with how they spend. They don't run off and buy new cars. They take care of their money carefully. They don't usually end up in bankruptcy court--very seldom. Look around at your neighbors, the people you know who take care. They don't overdress. They drive a modest car. They take care of their money. They are not filing bankruptcy. Some of them get into trouble through no fault of their own, no doubt. But I am just saying that. There are advertisements all over America in newspapers and late night TV and cable: Come on down. Wipe out your debts. You don't have to pay what you owe. Just come on and talk to old Joe, your good, friendly bankruptcy attorney, and he will just wipe them all out. Do you know what they tell them when they come in there? They say: Take out your credit card. I want you to take your paycheck that is coming in now, you pay that to me, pay my fee, and you put everything else on your credit card. Then when you are bankrupt you just wipe that out and you don't have to pay the credit card company. That is the way it works. We know that. People are following the advice of their lawyer. Lawyers are giving them advice based on what the law allows them to do. Mr. President, you are a lawyer. When you come in there, the law allows you to tell your client that is what they ought to do and it is going to save them money. Then they do it. It is not illegal. I guess it can't even be said to be unethical, because it is provided for under the Federal bankruptcy law that we in this Senate are responsible for creating, monitoring, and fixing when it is not working right. That is all I am saying. We are not here to deal with the uninsured on a bankruptcy reform bill. We are not here to fix all the language on bank lending and interest rate problems in America on a bankruptcy bill. This legislation is now up for its fourth time in the Senate. We have already had four markups in Judiciary over 8 years. It is basically the same bill. It is time for us to have some reform. That is all we are saying. I want to talk about the health care debt. I hate to say it. We have had some demagogic comments. You know, some of them have been down here--not Senators Feinstein and Kyl--talking about credit card companies. When they give out money they are bad companies, as though they are the evil forces. I know they have a profit interest. I know they like to get that high interest rate. I know they are not unhappy if my mother sends in by mistake the minium payment rather than the total debt due when she probably would have paid the total debt due if she could read those complicated forms. I am not saying they don't have an interest in making a profit. They do. But the very act of any credit card company that provides money to Americans and then they don't pay it back, who is oppressing whom here? We have class warfare rhetoric going on such as the credit card companies ought to be blamed for providing money to people who do not pay it back. That is just an aside; not particularly valuable, I suppose, in the course of this debate. We are trying to create a system that allows us to fairly and responsibly wipe out people's debt so they don't have to pay what they owe. What about medical debt? If you have enough money to pay some of your debt, let me ask you: Should you pay your doctor, should you pay your hospital, or those evil entities? If other people are getting paid money, ought not they to be paid? That is in some sense what is being suggested here. Let us take a look at what the deal is. This is to repeat, the deal is this: On this reform, people who file for bankruptcy who make above median income may be required by the bankruptcy court to pay at least a portion of what they owe based on their income as they show it to the court. If their income is below median income, they wipe out all their debt, as they always have. There is a growing concern in America that doctors, lawyers, high- income people run up a bunch of debt, and they have decided they would rather wipe it out than to pay it back, and they go into bankruptcy court. Do you know they can do it? Now a person with a $200,000 a year salary can have $100,000 in debt and go into bankruptcy court and wipe out those debts today and not pay any of it, be free and clear. Under this bill, they would say, Wait a minute. Your income is high enough. Over 5 years is all they can be made to recompense the debt when they got money or services. We are going to scale out what we think you can pay for at least 5 years so that those people you got money and services from will get something back. You don't get to wipe out all of your debt. That is what we are talking about. What the experts have told us in the Judiciary Committee, of which I am a member, is that 80 percent of the people who file bankruptcy are below median income. Surprise, surprise. Most people who are filing bankruptcy have lower incomes. So 80 percent will not ever be in the higher level and not be required to pay back any of their debt, whether they are medical debts, gambling debts, automobile repair debts, whatever those debts are. They won't be required to do that. In addition, the bill provides for special circumstances, and the court can still not make them have to pay back any of it. The expert witness we had in Judiciary Committee a few weeks ago said that based on his opinion and what he has studied, he felt probably an additional 7 percent would qualify there. I submitted yesterday, and it was agreed to, the Sessions amendment to the bill that explicitly states health care can be a special circumstance that would cause a person not to go into chapter 13 and the court could find them to stay in chapter 7. What Senator Kennedy's amendment would do is provide protection for the rich. It would provide no protection, no benefit whatsoever for poor people--people making below median income. They do not get any benefit out of it. He is providing an amendment that says somebody making $200,000 or $300,000 a year won't have to pay a dime to his local hospital; won't have to pay his doctor bills; won't have to pay his pharmacy. Why? That is not right, in my view. Not only that, it goes at the core of what this legislation is about--trying to bring some balance into the system to treat poor people fairly; let them wipe out a bit of their debt, and people with some income to pay it back. The court would require them to pay some of that back, depending on the level of that income. I think we need to think about that. Let me say this: I have been around this bill now since I have been in the Senate. There is a Professor Elizabeth Warren who has been absolutely incredibly determined to defeat this bill. She has written op-eds, and she has distorted this legislation, in my view. She has not accurately stated the facts, and she has been given every opportunity. She was allowed to testify at the last hearing which I referred to. I want to comment on some things that I think are important which this professor ought to be aware of. On the eve of our hearing, she announced this big, new survey that 54 percent of people in bankruptcy are in bankruptcy because of medical bills. Therefore, we ought to collapse, I suppose, and not have bankruptcy reform on that view. Let me show you what the accurate numbers are. Her study involved interviews of certain numbers of people; about 1,700 people as I recall, 1,700 bankruptcy filers they surveyed. They have a very broad definition of what a medical bankruptcy is. Whoever heard of a medical bankruptcy? I see the Presiding Officer, an attorney from the State of Florida. There are bankruptcies; you go into bankruptcy. This is not a medical bankruptcy. Medical debts are part of a debt you may owe. Maybe you don't have any medical debt. But it is not medical bankruptcy. It is bankruptcy. According to the column on medical bankruptcy, her definition of medical bankruptcies is gambling debts, and alcohol and drug abuse, in addition. So if you have alcohol, drugs, or gambling, she counts that as a medical bankruptcy. That goes to show you the tilt in her report that she accounted with such great fanfare a few weeks ago. Now, interestingly, the Department of Justice, which operates the U.S. trustee system in 48 States--they work in the bankruptcy courts. They monitor the bankruptcy courts. They try to watch out for fraud and abuse. They did a survey in 2000 to 2002 on medical cost as a factor in bankruptcy cases. They reviewed 5,203 chapter 7 cases from 48 States. Only slightly more than 5 percent of unsecured debt reported in those cases was medically related from actually looking at their bankruptcy filing. When you file bankruptcy, you fill out a form. You ask the court to wipe out these debts so you do not have to pay them, and you list your debts. If you do not list a debt, the court cannot wipe it out. Everyone today who chooses to file chapter 7 can wipe out their debts, but they have to list them. All we have to do to determine how much of the total existing debt is based on medical is to look at the files. That is what the U.S. Trustee did. They found 5 percent of the total debt was medically related. They also revealed in their study that 54 percent of the cases listed had no medical debts whatever. Fifty-four percent did not mention any medical bill--not a $25 bill to the doctor or a $50 bill to the pharmacist. They noted that those who did have medical debts--and it has been suggested that Americans are crushed under huge medical bills; sometimes that happens, I do not deny that--they found that 90 percent of the cases that did have medical debts reported debts of less than $5,000. If you are making $75,000 or $80,000 a year, you might be able to pay back part of that $5,000. So why shouldn't they pay back a portion of that cost? Even in those cases where a medical debt was listed on their petition for bankruptcy, the medical debts only accounted for 13 percent of the total unsecured debt for those files. That is a completely different picture than what we have been hearing today. This is a completely different picture, I submit, than we have been hearing from Professor Warren, who has opposed bankruptcy reform for any reason she can conjure. I have read her statements, and they have not been objective. This is another example of it. I don't appreciate it. She can say what she chooses. Senators can quote her numbers all they want, but I believe those numbers from the U.S. Trustee Program based on review of actual bankruptcy filings where debts have to be listed are accurate, far more accurate than the other. Now, if you do have medical debts and those debts tip you over into bankruptcy--maybe you were getting by, and, bam, you have an $8,000 bill you cannot handle and you feel you have to go into bankruptcy. If your income is below median income in America, you wipe out every bit of that debt. For 80 percent of the people, they will be able to do that if that is what they choose. If they make above that higher income level and can pay back, according to the court, some of their hospital debt, they ought to pay it back. I don't apologize for that. That is what we ought to do. That is what this bill strives to do. As my amendment we passed yesterday explicitly states, if medical causes are a problem and extraordinarily difficult, medical problems can be a factor for the court to allow those with incomes even above median income to go into chapter 7 where you wipe out all your debts rather than chapter 13 where you pay back a portion. Finally, chapter 13 has many good values. There are many things good about chapter 13. This will shock some of my colleagues. In Alabama, the latest reports I got from our bankruptcy judges are that around 50 percent of the filers in Alabama file under chapter 13. Why would they agree to pay back part of their debts? No. 1, they like paying back their debts. Like under chapter 7, the creditors can no longer call them, they cannot be sued, and they cannot be harassed at their workplace. Any lawsuits filed against them are stayed and stopped. The money is paid to the bankruptcy court. They pay out a percentage to each of the creditors based on the court's finding of how much each is entitled to get. They do this and work their way out of it, and they are happy. They are able to keep their automobile, often, and cram down the value of it. Maybe they bought an automobile for $25,000 and they kept it 3 years. They went into bankruptcy, and it is now worth $15,000. When they recompute the numbers, they only have to pay back $15,000. They actually walk away from paying an obligation they promised the dealer or the bank. It may help them keep a home. There are a lot of reasons why lawyers who represent their clients think chapter 13 is not such a bad thing. In fact, it is in the interest of the client. Those people I refer to in Alabama who voluntarily choose chapter 13 could choose chapter 7 without any hesitation if they thought it was better. Just because someone is moved into chapter 13 does not mean it is all bad. In fact, many people choose it for a variety of reasons. Anyone with median income or below or even above who has extensive medical bills will either be able to wipe them all out if they are below median income; if they are above median income, they can be required to pay some of that debt back in monthly payments in a period not to exceed 5 years. That is fair. That is just. Who knows, it might help our hospitals keep their doors open instead of having to close. I feel strongly about this bill. Every issue that has come up now has come up previously. It is time to move forward. Let's get this bill done, complete this work, and help improve the integrity of the bankruptcy system. It also provides tremendous benefits for women and children. They have a much higher priority in bankruptcy for alimony and child support. It eliminates the obstructive use of bankruptcy court to block evictions, eliminates a lot of other abuses, and contains some attorney fees in ways that have not been good in the past. There is a lot that is helpful that will streamline our system and make it better. I thank the Chair and I yield the floor.

Mr. SESSIONS. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. SESSIONS. Mr. President, how much time is left on this side?

Mr. SESSIONS

Mr. SESSIONS. Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on Tuesday, March 1, 2005, at 2 p.m., to conduct a hearing on the nomination of Mr. Ronald A. Rosenfeld, of Oklahoma, to be a Director of the Federal Housing Finance Board.

Mr. SESSIONS. Mr. President, I ask unanimous consent that the Committee on the Judiciary be authorized to meet to conduct a hearing on Tuesday, March 1, 2005, at 9:30 a.m., on ``Judicial Nominations.'' The hearing will take place in the Dirksen Senate Office Building Room 226. The tentative witness list will be provided when it is available. Witness List Panel I: Senators. Panel II: William Myers, to be United States Circuit Judge for the Ninth Circuit Court of Appeals.

Mr. SESSIONS. Mr. President, I ask unanimous consent that the Committee on Indian Affairs be authorized to meet on Tuesday, March 1, 2005, at 10 a.m., in Room 485 of the Russell Senate Office Building to conduct a hearing on S. 147, the Native Hawaiian Government Reorganization Act.

Mr. SESSIONS. Mr. President, I ask unanimous consent that the Committee on Health, Education, Labor, and Pensions be authorized to hold a hearing during the session of the Senate on Tuesday, March 1, 2005, at 9:30 a.m., in SD-106.

Mr. SESSIONS. Mr. President, I ask unanimous consent that the Committee on Finance be authorized to meet during the session on Tuesday, March 1, 2005, at 2:15 p.m., to hear testimony on the financial status of PBGC and Administration's defined benefit plan funding proposal.

Mr. SESSIONS. Mr. President, I ask unanimous consent that the Committee on Energy and Natural Resources be authorized to meet during the session of the Senate on Tuesday, March 1, at 10 a.m., to receive testimony on the President's proposed budget for FY 2006 for the Department of the Interior.

Mr. SESSIONS

Mr. SESSIONS. Mr. President, I ask unanimous consent that 30 minutes of additional morning business time be set aside at 2:15 today and that Senator Byrd be recognized at that time; provided that following the expiration of the Republican morning business time the Senate resume consideration of Calendar 14, S. 256, the bankruptcy bill.

Mr. SESSIONS

Mr. SESSIONS. Mr. President, I ask unanimous consent that the pending committee amendments be agreed to and be considered as original text for the purposes of further amendment.

Mr. SESSIONS. Mr. President, I am pleased we are able now to move forward with this bankruptcy bill. We have been at it 8 years. It has passed this Senate 3 different times, one time with over 90 votes, and the last time was 83 to 15. It represents many years of steadfast debate and discussion. I see my colleague from Illinois, Senator Durbin, has been very active in all of this debate. As a matter of fact, at one time he was sponsoring the bill. He has continued to offer amendments that he believes improve it. Some have been accepted and made a part of the bill, some have not. I think his evaluation of the legislation is far too negative in terms of the impact it would have on poor people. I believe it is going to benefit poor people. It is going to benefit families. It is going to benefit mothers with children. Clearly, it will do that and it will crack down on abuses. Are there additional abuses we would like to deal with, one in particular he just mentioned, the homestead exemption? I would like to have gone further. It is in the constitution of quite a number of States that homesteading is so much and Senators have dug in their heels and said this overrides the Florida constitution, the Kansas constitution, the Texas constitution, or I cannot agree to do that on the floor, I will fight this bill and object to it if anyone tries to do that. So we made some improvements in the abuses on homestead. I think that was the right direction. I wish we could have gone further. Senator Herb Kohl and I would have offered the amendment that could have changed it even more significantly, but perfect is not always achievable. I wish we could do more, but I think we made some real progress. We delineate those steps that tighten it up and make it much more difficult to abuse the homestead exemption. One has to actually live in a house for 2 years in that State or they cannot take advantage of it. That is a step forward and will stop these people from buying a house on the eve of filing bankruptcy. So there are some good things. With regard to health care, let us talk frankly about health care. Yes, it is a factor in quite a number of bankruptcies. It is not the No. 1 factor. In my view, over half the bankruptcies are clearly not driven by health care, but a large number of them are impacted by health care bills. The question is this: Will it change the situation for poor people who have health care bills? Will they not be able to take advantage of bankruptcy and wipe those debts out today, just like they would? Well, if they make below the median income--and we think about 80 percent of the filers in bankruptcy make below median income--the law is not going to change. They will still be able to wipe out any debts they have for medical or other reasons. Then what about if one has a continuing health care debt, and they make above median income but they have a serious medical cost which is recurring regularly, what can they do about that? They will have a harder time going into chapter 13 and paying back some portion of the debts that they owe, people argue, and they are correct, but under this bill the bankruptcy judge can calculate that extra recurring health care debt as part of the expenses and those people would still be able to file under chapter 7, wiping out all of their debts, if that is what they chose to do. If they make above the median income and are able to pay off some of their debts to their doctor and their hospital, why shouldn't they? You mean they have no obligation to pay a hospital that may have spent a lot of money helping them get well or a physician who took care of them and provided medical care to them? If they are making $80,000 a year and in bankruptcy under chapter 13 the judge finds that a person could pay back 25 percent, why should they not pay 25 percent? The judge will not order it unless he believes based on the person's income level they have the ability to repay. When a person in America undertakes an obligation to pay someone, they ought to pay them, and in any country that is so. We are drifting a bit to suggest there is no real obligation to pay the debts we incur. If we get to that point, then we have eroded some very important fundamental moral principles about commerce in America. I know Senator Durbin has an amendment he would like to offer, and I will not delay him from doing that. I have some other things to say in general about the bill, and I can say those later. I believe this is a rational bill. That is why it has such broad support. I believe this bill says plainly and clearly, if one can pay back some of their debts, they ought to do so. There is no reason why somebody making $100,000 who can pay back 20 percent of the debts he owes to the person who fixed his car or the doctor who helped him get well should not pay that back. Why should they wipe out all of those debts? For the vast majority of people who file, they will be able to file under chapter 7 and wipe out all of their debts if that is what they choose. I will say one thing further about chapter 13. That is the category of bankruptcy a person would be put into if they were required to pay some of their debts back. Chapter 13 has been a part of bankruptcy law for quite a long time. In my home State of Alabama, over half the bankruptcies are filed under chapter 13. People want to pay their debts. They are behind in their debts. People are bugging them, the phones are ringing, lawsuits are being filed, and they are overwhelmed. They cannot pay all of their debts at once and they file under the bankruptcy law. They say, I want to pay back a percentage of my debts, Judge, and if you will set out a schedule, if you will get these creditors off my back and have them quit calling me, quit suing me, quit sending me demand letters, you set up the schedule, I will pay this one so much a month and this one so much a month. That is a healthy, good thing. We ought to do more of that. In some States, under 5 percent of the debtors go into chapter 13. That number ought to come up because a lot of those people in some of these States that are so few in choosing chapter 13 should be in chapter 13 for their own self-interest. One may ask, well, what about these people in Alabama? Are they making them go into chapter 13? No, they have chosen to go into chapter 13 because they want to pay back a portion of their debts. They want to stop the lawsuits from going on. There are other advantages to it, such as being able to keep an automobile and the apartment or the house that one owns in ways that one would otherwise not do. There are some real advantages of going into chapter 13 rather than chapter 7. Many people choose it and in some areas of the country it is very much underutilized. This will capture only about the top 20 percent. One expert at our committee hearing said about 7 of those will have extra continuing debts that will take them out of it, so it will probably not be much over 10 percent of the filers who will be impacted. But some of those are the biggest offenders. Some of those are the people with the highest income. As a matter of fact, all of them will be people with incomes above the median income. They ought to pay some of their debts back. This bill will say that they must do that. I think it will help us in many ways to have more integrity in the bankruptcy system. That is why we have such strong support for it. I am sure we will have a full and open debate as we go forward the rest of this week. I hope we will have a vote, and I suspect we will have another strong vote for final passage. I yield the floor.

Mr. SESSIONS. Will the Senator yield for a brief question?

Mr. SESSIONS. I don't think the Senator would deny that this new bankruptcy reform bill makes it more difficult than current law to abuse the homestead exemption.

Mr. SESSIONS. We didn't go as far as we would like to go, but we did make some progress.

Mr. SESSIONS. Mr. President, I share Senator Durbin's respect for our men and women in uniform. I served over 10 years in the Army Reserve. I have made three trips to Iraq as a member of the Armed Services Committee. We work on those issues on a daily basis. The last time I was in Iraq we were meeting with soldiers, and I had one tell me his business had been hurt by him being there. He lost income, and he was worried about it. We discussed that with the soldiers there. Then later he came up to me and said: I want you to know, Senator, one hour from now I am signing up for another 7 years. It made me proud to know that we have that kind of service personnel who are serving their country well. How we ought to compensate them, how we ought to benefit them is something all of us need to consider. We are having increased compensation plans, increased bonuses for reenlistment, and other increasing benefits for our personnel because we love them. We respect them. We want to affirm them. We want to carry our part of the burden that they are carrying as they serve us in dangerous areas of the globe today. I want to point out, though, and bring ourselves back to where we are, this is not a bill that deals with American health insurance. It is not a bill that deals with compensation for the military. It is not legislation that should set bank lending rates. That is a Banking Committee issue, and it has been raised against this bill on a number of occasions. We have some credit card changes here, consumer-oriented credit card amendments that I know Senator Durbin and others have asked for and have been cleared by the Banking Committee. But this is not the place to set banking regulations in a bankruptcy bill. This legislation is designed to analyze what is occurring in Federal bankruptcy courts every day, to see what is happening there. What we have learned is that over the last 30 years, people have learned to manipulate this system in ways that are not good for the economy. Lawyers, particularly, have advised their clients on ways they can absolutely maximize their benefits under the bankruptcy law. And sometimes we have found that has not been healthy. As a result, these advertisements--and they are on television, in the newspapers, in the free things at the checkout counter where it tells you where you can buy things on sale--tell you how to file for bankruptcy. That is all right. It is a free country. But those of us who set policy and set the rules for the bankruptcy system need to analyze how it is actually working in bankruptcy court. We need to ask ourselves what we should do to make it better. And we need to do some things that help debtors such as single moms, who have bankruptcies filed against their child support and things of that nature, to put them higher up on the list of people who get compensated. We do that. The testimony is unequivocal that with regard to family breakup, alimony and child support, this bill is a huge step forward for children and their parents who receive those benefits. There is a lot in here that benefits people on a routine basis who have to go into bankruptcy court. Remember, if you make below median income in America and you file for bankruptcy, you can wipe out, as an absolute right, every debt you owe, no matter how you incurred it, for any reason. I know Elizabeth Warren. She has been an activist against bankruptcy reform for years. And one thing she puts in her definition of debts arising from health care is gambling debts, for example. I believe those numbers that have been promoted at a recent hearing by her are at best a bit too high. They are really less. Are health care debts a part of this? Yes. Are there people with insurance who still don't have enough money to pay their health care debts? Yes. Do people who don't have insurance have health care debts that help cause them to be unable to pay their debts and go into bankruptcy? Yes. But what if you make $100,000 and you have $75,000 in debt? Under current law, you can go into bankruptcy court and wipe out every one of them. It can be your doctor, your local hospital, your local automobile dealership, your friendly mechanic, anyone you owe in the community--just wipe out those debts. You don't have to pay them. Lawyers will tell them that. They are advertising how to do that. Beat your landlord. Don't have to pay your rent. Come on down. We will keep you in your house another 6 months by filing bankruptcy, which will stay eviction. And then, when you finally lose that, which you inevitably will lose that contest of eviction, then you wipe out all your debts and rents, and you don't owe anybody anything. Let me say, there are problems in bankruptcy that this bill has carefully set about to deal with and tried to fix. I am rather proud of it. We have made a lot of progress on dealing with a number of the abuses that exist. But we are not in the business of dealing with health insurance, health care reform. We can't deal with the issue on how we ought to compensate reservists and guardsmen who have been activated. I will say this with regard to the military issues. My staff has been reviewing the fundamental protections provided to the service men and women under the Soldiers and Sailors Relief Act, originally passed in 1940. It is a tremendous piece of legislation to protect service personnel who are called to active duty from being harassed, abused, or taken advantage of in court. It remains the law of the land today. It has been strengthened over the past years. When I was in the Army Reserve, I was a U.S. attorney, and sometimes there is a basic officer in the unit, and sometimes in my duties as a jack officer it fell in my lot to brief the personnel on the benefits of it and to represent people who would be abused under the Soldiers and Sailors Relief Act. It has some very good and powerful things in it. Let me show you how many of the concerns that the Senator has are covered by that act. In 2003, we passed the Service Members Civil Relief Act, which added even more protections. The goal was to financially protect Active-Duty military members, reservists in active Federal service, and National Guard members. The act allows military members to suspend or postpone civil financial obligations during their period of military service. Oftentimes, this can enable them to avoid having to file a bankruptcy. The information brochure on the Soldiers and Sailors Civil Relief Act, by the Department of Defense, states that it provides an umbrella of protection, and it does. The umbrella of protection created by the act includes these provisions: an interest rate cap of 6 percent on all debts incurred before or during commencement of Active-Duty service. So if you are called to active duty and you entered into a debt that carries a 25-percent interest rate, you can reduce that. It applies to mortgage payments, credit card payments, and car loans. The act provides protection from eviction. It would delay all civil court proceedings, including bankruptcy, until you get back--an automatic delay. If the lawyer says the serviceman is in Iraq--``He has been activated, Your Honor''--this case is stayed. That is what is done immediately. There is no dispute. Foreclosure proceedings are delayed. Divorce proceedings against a service member are stayed. There is a prohibition on entering of default judgments against Active-Duty military members and the ability to reopen default judgments. In other words, sometimes when the service member is gone, he does not know he has been sued and failed to respond effectively because he is on active duty. The judge is prohibited from taking a default. But if the judge, by mistake or otherwise, enters a default judgment, then that Active-Duty member can have it set aside when he comes back. It is not binding. The ability to terminate property, residential and automobile leases at will is provided for in this act. In other words, if you enter into a solemn lease agreement for a residence or an automobile and you are called up, all you have to do is write them and say: I have been activated, so I am no longer bound by this lease agreement. It includes the continuation of life insurance of at least $250,000, without requiring premiums to be paid. The tolling of statutes of limitation--in other words, if you have a lawsuit and you are thinking about filing it and the time for you to file it is about to run and you get called to active duty, that time is extended until you return, and you have time after you return to file any lawsuit because the statute of limitations is tolled. There is temporary relief from mortgage payments, and credit rating protections. In other words, if you are somehow found to be poorly responsive to your debts because you have been activated, you can clear up your credit rating. There are penalties for landlords and creditors who violate the act and fines of up to $100,000 or imprisonment if they harass a service member contrary to this act while they are serving their country in some distant land. The Supreme Court has even added to the act the ability to help military members in times of financial need by ruling that the act must be read with an eye friendly to those who drop their affairs to answer their country's call. This has been a strong act that provides great protection for our men and women. We all ought to be proud that America has understood this. Now, let's talk about some of the specific ideas that are in Senator Durbin's bill. He said it somewhat differently than what he offered in committee. I have not seen amendments until this morning, and I briefly heard his comments and have not had a chance to study it in detail. But he would exempt service members, military Active-Duty members, veterans, and spouses from means tests contained in the bankruptcy bill because a means test will not reflect their real income or real ability to pay debts back. But I don't think that is true. The bill contains a rebuttal to the means test application when a court finds special circumstances. These are the ones I think we are discussing. A special circumstance that a military member could assert under this bill as it now exists--this bankruptcy bill--would include the fact that their income dropped in recent months due to a call to active duty or there have been excessive expenses arising as a result of being called to active duty. That assertion would keep the means test from applying to the military debt. No special exemption, it would appear, would be necessary for military members on this basis because a call to active duty that causes a drop in income, to me, would be clearly a special circumstance. The bill currently contemplates that, although I think, frankly, we could explicitly state that as a mandatory circumstance. Second, he asserts that this amendment is necessary to protect military members' homesteads. His amendment would apply to the Federal cap of $125,000 contained in the bill to all service members or allow the service members to choose the exemption level permitted by the State he resided in before becoming a service member. It opens up the homestead compromise we have battled so hard on and dealt with. I don't think it would affect many service members. Many of them live in housing provided by the military. Because the bankruptcy bill requires 2 years of residency in a State before the State homestead exemption can apply, it is highly unlikely that military members will be often covered by it. They move frequently. The Senator also argues his amendment is necessary to protect service members from predatory loans and high-interest loans. I believe that this concern is well covered by current law. The Soldiers and Sailors Relief Act prevents interest charges greater than 6 percent from being collected on any type of debt owed by an Active-Duty service member. Even debts the service member made before being called to active duty are covered by this interest cap. We have dealt with this issue before. The House had a full debate on it. It was voted down there. The floor debate on the bankruptcy bill previously, S. 1920, which exempted veterans and others from the means test, was offered by Congresswoman Schakowsky in opposing the amendment. Chairman Sensenbrenner pointed out that the means-based test only applies to people with incomes above the median State average. I will repeat that. Anybody who is making above the median income could be impacted by the means test and, therefore, could be ordered to pay back some of the debt they have lawfully incurred. If they are unlawfully incurred, they cannot be made to pay them back. The court won't make them pay it back. But they could be made to pay back some of those based on how much their income is above median income. If they are making $200,000 a year, the judge may say they have to pay them all back. If they are making $50,000 and they owe $100,000 in debts, the court may conclude they only can pay back $15,000. That is how this will work out in reality. He points out that factor and notes that anyone who is below the State median income does not qualify on the means-based test and their bankruptcy petition cannot be tossed out of chapter 7 and put into chapter 13 where some debts are paid back. Chairman Sensenbrenner also agrees with my analysis that the issues have been taken care of in the most part since 1940 under the Soldiers and Sailors Relief Act which allows for the staying of legal proceedings against anybody on active duty. I think he points that out. We have some ideas. He makes another point I will not go into at length. I will say this: I am very concerned about our men and women in uniform. I want to make sure there are no loopholes or gaps in the Soldiers and Sailors Relief Act. I want to make sure this bankruptcy act in no way makes it more difficult for our soldiers than what they have today. I will be glad to look at this amendment and study it more carefully and perhaps offer an alternative that would be more constrained and would deal more directly with the problems. A veteran could be someone who has been in the country, off active duty, for quite a long time. I am not sure that adding all veterans to this exemption would be a good idea particularly. I have some real doubts about that. Mr. President, I state my opposition to the Durbin amendment. I look forward to analyzing it further, and if there are areas in which we can reach accord, I will be pleased to support that. If there are other needs of our service personnel that could be impacted positively by a bankruptcy reform bill, I am prepared to look at that. I yield the floor.

Mr. SESSIONS. Mr. President, will the Senator yield for a unanimous consent request?