Bill Thomas

Mr. THOMAS

Mr. THOMAS. Mr. Chairman, I yield myself 9 minutes. (Mr. THOMAS asked and was given permission to revise and extend his remarks.)

Mr. THOMAS. Mr. Chairman, this is an important day. There were a number of people who never thought it would come about. The argument that the House simply cannot address reform of its own rules, many said, would lead us not to this day. Notwithstanding whatever occurred over in the Senate, we have in front of us two reform pieces of legislation with the opportunity for the minority, on the motion to recommit, to offer some variation that they choose to offer. No one doubts that the job in front of us is a difficult one. As we heard on the rule, there are any number of Members who would like to offer a substitute. As a matter of fact, if we had an open rule, there would probably be 435 different reform procedures, which means everyone could find a home and there would not be a majority to try to bring about change. What we have here are clearly two different approaches to reform: First of all, let me say that I want to commend the gentleman from California [Mr. Fazio] and his staff, and I want to commend the majority on our side of the aisle on the Committee on House Oversight and out staff. Trying to put together a package which meets the various needs of the Members even required an amendment to the rule. I do not think anyone should criticize that process. I think people sent us here to get it right. If it requires adjustments right up to the time that we discuss the bill, it is better to do that than to lock in stone some position which may not afford us an opportunity to move forward. What we are trying to do today is move forward. I am very pleased that in both bills there are a significant number of common reforms. In the longest and most extensive hearings on campaign finance reform since the law was passed, we heard from a number of different witnesses. No two witnesses stressed the same theme more than the chairman of the Democratic National Committee, Don Fowler, and the chairman of the Republican national committee, Haley Barbour, when they sat side-by-side and talked about the perhaps good intentions of the reformers in the 1970's but the very serious unforeseen consequences of the law over the last 20 years on the question of political parties. In both bills today, we see very positive reform in the area of political parties, expanded opportunities to participate in the system, fewer restrictions in trying to support the issues and the candidates that the parties put forward. As a matter of fact, one of America's foremost experts on political parties, Professor Larry Sabato, who has also coauthored a book entitled ``Dirty Little Secrets,'' about the way money flows in Washington, said this about our bill, but it extends to a certain extent to the Democrats' provisions about political parties, as well. He says, ``No title is as welcome as strengthening political parties.'' He says, ``The parties are essential, stabilizing institutions in an increasingly chaotic political environment. In our society's self-interest, they deserve to be bolstered in every reasonable way.'' He says, ``I enthusiastically support the provision on party reform.'' Also, I think a number of cynics say that we, since we are incumbents, cannot reform ourselves. I think it is important to note that in both bills, both the Republican and the Democratic bill, we ban leadership PAC's, just 1 day after one of our local newspapers ran an article about how through leadership PAC's Members of Congress are raising significant new, and in fact record, amounts of money. No one can say we are not interested in reform if we are in fact denying this kind of a structure. Banning leadership PAC's is in the Republican bill, and it is in the Democrat bill. There are additional disclosure requirements, and we will go into some of the differences, but fundamentally both bills tighten up in the area of disclosure. However, Mr. Chairman, there are obviously fundamental differences, and the fundamental differences in the bill center around the way in which the Democrats and the Republicans choose to use government, the role of government and the use of government. In the minority's bill, they use government to control and limit. In our bill, we use government to empower individuals. For example, in the Farr bill, there are a very confusing set of dollar amounts which are used to determine how one can participate in the political game. One can spend $600,000 in the primary and the general, but you have got to have a set amount from individuals over a set amount of dollars. If in fact you are in a close primary; that is, a primary within 20 points of your opponent, then there are new rules that apply. If you are in a run-off, there are additional rules. It is a very complicated attempt to use government to limit participation in the system. On the other hand, we have a new approach. It is a novel approach. As a matter of fact, David Broder in The Washington Post said it may point the way to the future. It essentially reverses the traditional definition of reform. It may offer a way out of the maze. The Cleveland Plain Dealer said it comports rather well with political and constitutional realities and it is worth a try. What we do is empower individuals. We say that the control on the amount of money spent in elections is in the hands of the people back home, local control of campaign finances. A number of our colleagues who have not yet fully appreciated the radicalness of this procedure say there are no limits at all. Pretty obviously when they are used to staying in Washington and raising money, they are not excited about having the people back home determine how much money they can spend. We hear criticisms of the system that we have to spend time in New York or in Dallas or in Hollywood raising money and we are away from our basic job of representing our constituents. Well, folks, with the new position, the new thinking, the Republican bill, you get to go back home more often than not because you are required to raise a majority of your money back home. If that was a problem under the current system, we have changed it. A number of folks have said special interest control, that in fact the problem is the corruption or at least the appearance of corruption with special interest money putting in a majority of money in a number of campaigns. Folks, we fix that. A majority of money has to come from individuals who live in the district. We empower the people back home. In addition, we weaken incumbents by allowing parties to offset the incumbent carryover. This is a relatively radical idea. There have been suggestions to ban carryover, but we are the biggest sharks in the water as soon as the bell rings. What we have said is empower political parties to offset incumbent advantages. But the biggest and the best device to control incumbents is to tell them they have to go back home and get a majority of money from people who live in the district because in Washington, we have a monopoly on attention. In any other major city, we have a monopoly on attention. When we go back to the district, we have to share our incumbency with the other candidates. We do not have the privilege of exclusivity back home. It is the most radical, the best method of controlling incumbents. When people say we do not have a limit, no, we do not use Government to control, we do not impose a one-size-fits-all limit. What we do do is empower people back home. When a majority of people in your district have said you have spent enough, you have spent enough. Empowering people back home is a radical, positive change in campaign finance reform. Mr. Chairman, I reserve the balance of my time.

Mr. THOMAS. Mr. Speaker, I thank my friend from California for yielding once again. I think we are getting carried away with our own rhetoric. The gentlewoman from Connecticut just said this is the same old Washington game. Apparently she does not understand that in the majority's legislation we end the same old Washington game. We say, ``You have to get a majority of your money from people who live back home.'' We say that the incumbents who had a monopoly on the Washington game do not get it anymore. Mr. Speaker, it is a fundamentally changed system, and I understand that a number of folk who are, and I will not yield at this point, there are a number of people who are getting carried away with their rhetoric. And I will tell my colleagues that if they do not like the majority's provision, if they do not like the minority's provision, I implore them to talk to the gentleman from Missouri [Mr. Gephardt], the gentleman from California [Mr. Fazio], the gentleman from Texas [Mr. Frost]. Under this rule we have provided a motion to recommit with or without instructions. The gentleman from Wisconsin can have his wishes met, the gentlewoman from Connecticut, if she has a wish, can have her wishes met, the gentleman from Massachusetts [Mr. Meehan] can have his wishes met. If my colleagues do not like what is in front of them, offer it as the motion to recommit. Then we will determine whether they are in this process to promote reform or whether they are in the process to stir the pot and create more rhetoric and confusion in the minds of the American people. Mr. Speaker, during general debate I will be more than willing to discuss the substance of the bill.

Mr. THOMAS. Mr. Chairman, I yield 3 minutes to the gentleman from Tennessee [Mr. Wamp], a freshman who has had as much influence in redirecting campaign finance reform as any Member of the House.

Mr. THOMAS. Mr. Chairman, I yield myself 1 minute. What we just heard was an example of a failure to really understand how radical this new idea is, because the gentleman failed to make one particular connection, and that is the end in politics are votes, not money. Money is the name of the means. If in fact we are in the district talking to people, we are in fact going toward the end. If we are in New York, outside our district, that is the means: money. If we are in Hollywood, that is the means: money. When we are in our district, we are working toward the end. Time is money. It is a radical change. It will take time for some Members, who are so focused on money, to appreciate that we can actually get elected without it. It is called hard work. It is called organization. It is time we put the common man back in the picture working to elect someone without looking at dollars. Majority in district empowers people, not big bucks. Mr. Chairman, I yield 3 minutes to the gentleman from Michigan [Mr. Hoekstra], the chairman of the reform task force.

Mr. THOMAS. Mr. Chairman, I yield 2 minutes to the gentleman from California [Mr. Calvert].

Mr. THOMAS. Mr. Chairman, I yield 2 minutes to the gentleman from Ohio [Mr. Portman]. (Mr. PORTMAN asked and was given permission to revise and extend his remarks.)

Mr. THOMAS. Mr. Chairman, I yield 2 minutes to the gentleman from North Carolina [Mr. Ballenger], who has worked actively on that portion of the bill which empowers the rank-and-file in the labor union movement. (Mr. BALLENGER asked and was given permission to revise and extend his remarks.)

Mr. THOMAS. Mr. Chairman, I yield myself 30 seconds. In addition to the statement in front of the committee by the chairman of the Democratic National Committee about having no limits, which we finally decided was not as wise as we thought it was initially, this is another quote. He said on December 12 in front of the committee: ``I do believe that the contributions from individuals should be increased. If you asked me for a number, I would say $2,500.'' We thought that perhaps was an appropriate suggestion, as well. When we then began listening to the kind of outrageous statements made by people that we were enabling fat cats, we decided not to listen to the Democratic National chairman, and keep it at $1,000. And so it is interesting the kind of quotes the Democratic National Committee chairman actually believed when it was not rhetoric.

Mr. THOMAS. Mr. Chairman, I yield 3 minutes to the gentleman from Michigan [Mr. Ehlers], vice chairman of the Committee on House Oversight, someone who has spent numerous hours working with us to perfect the bill we have today. (Mr. EHLERS asked and was given permission to revise and extend his remarks.)

Mr. THOMAS. Mr. Chairman, I yield myself the balance of my time. Mr. Chairman, I do not have the time to correct all of the dollar errors on the gentleman's chart, and I would also tell him that all of the volume in the world does not make his statement so. We have more disclosure, not less. We have tighter rules on independent expenditures, not less. This whole debate is about the role and use of government. Democrats, true to form, want to use government to control. They want to limit. They want to have a one-size-fits-all Washington-imposed dollar amount. The problem is, they have no limits at all, unless people voluntarily give up their constitutional rights as defined by the court. We say, let us use government to empower individuals. Let us let the people back home who are subjected to all of this determine how much should be spent in a campaign. That is truly a frightening concept to the people across the aisle. They would have to go back home and justify what they are doing to the people in the district without their Washington power base, without their New York fundraisers, without their Hollywood extravaganzas. Let us empower the people back home. That is what we do. That is what is really revolutionary about the approach that we are taking. I would ask for an ``aye'' vote on the basic bill.

Mr. THOMAS. Mr. Chairman, I yield 30 seconds to the gentleman from Michigan [Mr. Hoekstra].

Mr. THOMAS. Mr. Chairman, I yield 2 minutes to the gentleman from Ohio [Mr. Hoke].

Mr. THOMAS. Mr. Chairman, I demand a recorded vote.

Mr. THOMAS. Mr. Chairman, I yield myself 1 minute. Mr. Chairman, the gentleman is from the Olympic city and just as the IBM computers are garbling the various statistics and data going on at the Olympics, I think we are beginning to see that in terms of the dollar amounts involved in these various bills, so I think it is time to review the bidding. We have a $1,000 amount for individuals, indexed prospectively. The Democrats have the same amount. For PAC's we have $2,500. They have $8,000 in an election cycle, $5,000 in an election, twice as much as we do. On the aggregate amount that an individual can give a party, they have $100,000, we have $100,000. So when you get wound up in your rhetoric about what our bill does versus the Farr bill, please, it's the same amount on individuals, half as much on PAC's, and the same amount on aggregate amount to parties. Where we went wrong temporarily was listening to Don Fowler, the chairman of the Democratic National Committee, who said they should be unlimited to parties and that the amount that individuals could give should be $2,500. We put that in the bill. When we examined it more closely, we decided he was a bit too exuberant. So when you look at the numbers, please keep in mind facts and reality. Mr. Chairman, I yield 5 minutes to the gentleman from Illinois [Mr. Fawell], the chairman of an extremely important subcommittee of the Committee on Economic and Educational Opportunities which has given us a very valuable addition to the bill known as the Worker's Right To Know.

Mr. THOMAS. Mr. Chairman, I yield myself 30 seconds to place in the Record a letter from Common Cause. It starts out, ``Dear President Clinton: According to recent news reports, the Democratic National Committee has promised special access to you and other top administration officials in exchange for large campaign contributions,'' et cetera, et cetera, et cetera. The letter referred to follows: Common Cause, Washington, DC, July 5, 1995. Dear President Clinton: According to recent news reports, the Democratic National Committee (DNC) has promised special access to you and other top Administration officials in exchange for large campaign contributions. We call on you immediately to end these fundraising tactics, and to publicly make clear that neither you nor members of your Administration will engage in such activities. According to an article published in the Chicago Sun-Times: For $100,000, a contributor gets two meals with you and two meals with Vice President Gore, as well as a slot on a foreign trade mission with party leaders, and other benefits such as a daily fax report and an assigned DNC staff member ``to assist them in their personal request.'' For $50,000, a contributor gets invited to a reception with you, one dinner with Vice President Gore, two special high- level briefings, and other benefits. For $10,000, a contributor gets invited to a presidential reception, a dinner with Vice President Gore and ``preferred'' status at the 1996 Democratic Convention. In promoting this fundraising approach, the DNC has apparently surveyed the ``access and influence'' marketplace, toted up a price tag, published a catalog and advertised a sale of your time and attention, as well as that of the Vice President and other top Administration officials. There is no defense for this. It is not enough to say that this type of fundraising is just an unfortunate part of the current campaign finance system. Nor is it enough to say that past Administrations have engaged in similar sales of access to the Presidency. This is wrong, pure and simple. Every American knows that it is wrong and your own statements make clear that you know it is wrong. In your book, ``Putting People First,'' you said that American politics ``is being held hostage by big money interests . . . while political action committees, industry lobbies, and cliques of $100,000 donors buy access to Congress and the White House.'' Yet despite your own statements, you are now participating in a fundraising effort that will allow ``cliques of $100,000 donors'' to ``buy access'' to your White House. This kind of fundraising perpetuates the all too prevalent cynicism in this country that our government is for sale, that the wealthy have privileged access to elected officials and that special-interest money dominates the political process to the benefit of the few at the expense of the many. Most Americans could not even dream of making a $100,000 campaign contribution. The vast majority of Americans earn far less than $100,000 a year. It is tremendously disillusioning for the American people to see privileged access sold to those who are already the most privileged in our society. The DNC's fundraiser makes explicit what is often only implicit in campaign fundraising: that in exchange for large campaign contributions, you can buy the time and attention of this Nation's elected officials. The fundraiser also is a perfect illustration of the corrupting evils of the existing soft money system, where large contributions of $100,000 or more are again part of the American presidential election system, just as they were during the Watergate era. President Clinton, we strongly urge you to end this blatant peddling of access to your Presidency. We call on you to publicly announce that you are closing down the DNC's sale of access, and to make clear that neither you nor any member of your Administration will participate in the activities offered by the DNC in exchange for large campaign contributions. Sincerely, Ann McBride, President. Mr. Chairman, I yield 2\1/2\ minutes to the gentlewoman from California [Mrs. Seastrand], an in-the-flesh working woman.

Mr. THOMAS. Mr. Chairman, I yield myself 30 seconds, and I am going to try it one more time. Their limit is voluntary. If someone wants to spend as much money as they want, all the rules are out; they do not control spending. What we do is change the rules. If a wealthy candidate wishes to exercise their rights, we allow parties, we allow individuals, we allow PAC's to assist a candidate against the person who exercises their constitutional rights. They do not have a solution, they have an argument. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from Florida [Mr. Weldon].

Mr. THOMAS. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I would suggest to the gentlewoman from Washington that if she is able to raise $500,000 from individuals back home, she does not have to come to Washington, because the whole concept is she would have already won the election because every one of those people she talked to back home has a vote. When you have a majority required from your district, you are not only raising money, you are raising votes. That is the concept of the underlying bill. Let me take just a minute, because I think it is time to exercise the ``gotcha rule.'' You have heard the Democrats and the gentleman from Maryland go through and extol the virtues of their bill versus ours. What they will never do is talk about the fine print. That is our job, so I will do it: Gotcha. Take a look at section 304 of the Democrat campaign reform bill. Currently, corporate contributions cannot be admitted in Federal political campaigns. What they are not telling us is that they have a provision in their bill, section 304, which says corporate funds from credit card royalties are to be converted into Federal PAC contributions. If you take out a credit card, and we have all seen these schemes with various organizations, and it says ``Democratic Party'' on it, the royalties that come from the corporation that sold the credit card and carried on the processing of the papers are magically converted into Federal funds. They will not tell us that. They will criticize our bill on the time they are supposed to be explaining their bill, so I thought I would. Gotcha. Mr. Chairman, I yield 3\1/2\ minutes to the gentleman from Pennsylvania [Mr. Greenwood], one of the more thoughtful Members of the House.

Mr. THOMAS. Mr. Chairman, I yield 3 minutes and 30 seconds to the gentleman from Ohio [Mr. Boehner], chairman of the Republican Conference, a member of the Committee on Government Reform and Oversight.

Mr. THOMAS. Mr. Chairman, I yield myself 15 seconds. The last statement of the gentlewoman from Texas is simply not true.

Mr. THOMAS

Mr. THOMAS. Mr. Speaker, there is nothing small about small business. In my district alone, small businesses (under 500 employees) account for the vast majority of the total local business establishments. Nationwide, over 21 million small businesses employ more than half of the private work force. The irony is that while small business provides such major benefits to the community, it is the target of the Government's wrath in terms of taxation and regulation. Time and time again, this vital part of our economy is forced to bear the brunt of higher and new taxes. Small businesses faced the highest tax increase in American history in 1993. Statistics show that 70 percent of those affected by the 1993 tax rate increase were small businesses. Under this type of capital constraint, small businesses can be forced to downsize. Self-employed small business owners have an additional burden as they have not been able to deduct more than 30 percent for health care costs. Small businesses can even be blocked from growing by their inability to get accurate information on ways to comply with laws and regulations. This Congress is moving to encourage small business. With the passage of the Small Business Job Protection Act, H.R. 3448, in both the House and Senate and health insurance reform (conference pending), H.R. 3103, small businesses can look forward to benefitting from a reduction in taxes through an increase both in their expense limit and their allowable health insurance deduction. The bill also simplifies pension law, making it easier for small businesses to adopt retirement savings programs. Regulations serve as another impasse for growth in small business. 94 percent of small businesses lack knowledge of current regulations. This apparent ignorance is not the result of stupidity, but rather a constantly changing set of standards expressed frequently in confusing, technical language. This creates involuntary noncompliance on the part of the employer. Now, if an employer is found in violation of this regulation, he or she faces the prospect of fines and ultimately corporate shutdown. As a cosponsor of the Small Business Regulatory Relief Act, H.R. 3798, I recognize that my constituents cannot be in the dark about regulations that they are required to follow. Nor can they be expected to interpret the language of the mandate without any assistance from those who have direct knowledge of the intentions of the regulations. This act will reappropriate a negligible portion of the EPA, IRS, and OSHA budgets to Small Business Development Centers for purposes of offering counselling services to businesses regarding regulation compliance. In supporting this bill, I am optimistic that small business both in my district and elsewhere will be better equipped to comply in a cost-effective manner with the regulations of today and the future. Promoting incentives in small business growth is not just a district or a State issue, it is a national issue that demands our attention in order to ensure the stability of our economy. Small business deserves big recognition. It is time that our small image of this industry changes so that it reflects the huge rewards it bestows on our communities. Only then can we truly reap the full benefits of what is contained in small business.

Mr. THOMAS

Mr. THOMAS. Mr. Speaker, the gentleman from Missouri failed to inform the American people about one specific word. In the Speaker's quote he says, ``We don't plan on getting rid of it.'' The question is, What is it? The gentleman from Missouri tells us unequivocally it is the Medicare system. He knows he is wrong. Brooks Jackson on CNN exposed what the Democrats are doing. If we read the whole quote, what the Speaker was saying was that when seniors have an option, when Medicare is changed to allow seniors to choose the system they want, the old-fashioned, socialist, 1960's top-heavy bureaucratic system, will not be the one that seniors choose. It will, in fact, wither away. The only way to make sure that this comes about is for seniors to have choice. We had choice in the bill that passed the House and the Senate and that the President vetoed. The Democrats are scared to death to give the seniors the right to choose. If they can choose, they would not choose a bureaucratic system. That is what the Speaker meant.

Mr. THOMAS

Mr. THOMAS. Mr. Speaker, recent communications between the Department of Labor and California show we have another problem to correct in restoring power to the States. Bluntly, the Department is saying California has to pay unemployment benefits to certain criminals being released from prison. Current Federal law requires employers to pay Federal employment [FUTA] taxes on work performed by their employees. This includes prison inmates who work for private companies through innovative work programs established in several States, including California. Today, some 200 people in California prisons are employed in jobs provided under agreements between the State and private businesses. However, FUTA taxes do not have to be paid for work by prisoners employed in prison operations such as the laundry or cabinet shop. Since FUTA taxes are paid on behalf of some prisoners, the U.S. Department of Labor ruled that these prisoners must be paid unemployment benefits upon their release from their job--essentially, when they are released from prison. Failure to comply is serious: California employers, for example, would lose tax credits worth $1.7 billion for FUTA taxes they pay on other workers if the California program is disqualified. Why does Labor take this position? The Federal unemployment insurance program only permits denial of employment benefits in three cases: if the worker's income exceeds certain limits; the claim is fraudulent; or the employee was fired for misconduct. Since prisoners lose their jobs when paroled or released from prison, they do not fit the exceptions. California voters established the Joint Venture Program in 1990, creating a private work program for prison inmates. Criminals' wages are used to compensate victims, offset incarceration costs, and set- aside funds--20 percent--for the inmate's support upon his or her release from prison. In 1996, California voters overwhelmingly passed an initiative (Proposition 194) that denies unemployment benefits to criminals participating in the Joint Venture Program. The Department of Labor decision would force California either to pay out unemployment benefits to released prisoners or to eliminate a program that has been successful in helping criminals transition back into the work force. Allowing employees to lose $1.7 billion in credits for taxes they pay on the services of ordinary working people is not an option, needless to say. Legislation I am introducing today would change the law to treat all prison inmates who participate in work programs the same: Their services would be exempt from the FUTA tax. This would effectively deny unemployment benefits to released prisoners and prohibit the Department of Labor from placing such a ridiculous requirement on the States. The bill's enactment would give States an additional tool to use in trying to reform criminal behavior and I hope my colleagues will agree to its adoption in the near future.

Mr. THOMAS

Mr. THOMAS. Mr. Chairman, if we look at No. 1, it says ``deny the right of Federal employees to organize or be fully represented * * *.'' Can the gentleman assure me that fully represented does not mean a full-time person paid for by taxpayers?

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