Paul Wellstone

Mr. WELLSTONE

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 President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. WELLSTONE. Mr. President, I ask unanimous consent that the quorum call be charged to both sides.

Mr. WELLSTONE. My understanding, Mr. President, is Senator Hutchison of Texas and Senator Brownback want to speak, and if they do, I allocate to each one of them 10 minutes. My understanding is Senator Durbin also wants to speak. I allocate to the Senator the rest of my time.

Mr. WELLSTONE. I suggest the absence of a quorum.

Mr. WELLSTONE

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 President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. WELLSTONE

Mr. WELLSTONE. I say to the majority whip, am I to do my amendment to the bankruptcy bill?

Mr. WELLSTONE. Mr. President, I send amendment No. 977 to the desk.

Mr. WELLSTONE. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.

Mr. WELLSTONE. Mr. President, I want to get to the substance of my amendment in a moment. I want to respond for a moment to some of the comments from my colleague from Utah, Senator Hatch. The Senator from Utah said he was going to oppose this amendment because it was a ``delaying'' amendment. I want Senators to know that I offer this amendment in good faith as an effort, in a modest way, to improve this bill. It says let's have a GAO study and look at the bankruptcy bill and analyze the effect of it. I don't know how Senators can vote against this, but I want to make it clear that a Senator could file a thousand amendments if this was all about delay. To my knowledge, this is the only amendment--my colleague from Wisconsin, Senator Feingold, had filed an amendment, but I don't think he is going to offer it. I just want to be clear that your vote on this amendment is a vote on whether or not you think we should be accountable for our vote. That is really what it is. So I don't want anybody to say I can vote against this amendment because it is some kind of a delaying tactic. That is simply not the case. What we have to say to people back in our States is: Look, in good conscience, I voted against an amendment to do a careful evaluation of this bankruptcy bill to see how it is working. You can figure out how you want to fill in the blank. That is the argument you have to make. You can't say: I voted against this amendment because it was a strategy of delay. That is ridiculous. It is just one amendment. The second thing I have to do because you have to have a twinkle in your eye, and I think the Chair is one of the best at that. I just received today a solicitation from MBNA, which I think is the largest credit card bank in the country. They offered me a credit line of up to $100,000. There is an introductory 1.7-percent annual percentage rate, including cash advance. I thank the credit card industry for not taking this personally. This is sent to people--to our kids and grandchildren--every day. This amendment is straightforward. I hope, I say to the Chair, that it will garner universal support. It should. It doesn't attempt to undo anything the Senate did earlier this year. It doesn't revisit any of the debate that we have had. This is no trick. Look, if I had my way, I would kill this bill. For 2\1/2\ years, I have been trying to do that. This amendment is all about accountability. The main provision of the amendment requires that the GAO do a study of the impact of the bankruptcy bill on debtors and consumers of credit. It is that simple. Both sides have made dramatic arguments or dramatic claims about this legislation. In my case, they have been negative. In the case of some of my colleagues, they have been positive. My amendment says, OK, 2 years after this bill has become effective, let's have the General Accounting Office give us a report on how things have turned out. How in the world--I am amazed that there is opposition. There was a great Swedish sociologist, Gunnar Myrdal, who wrote, ``Ignorance is never random.'' Sometimes maybe we don't want to know what we don't want to know. But I think it is really hard for Senators, Democrats and Republicans, to make an argument that you are unwilling to let the GAO do a study of this careful policy evaluation. That is what this amendment says. Will we be accountable for the votes we cast? For those who think it will be a great bill, you will get a chance to see. For those who think it is going to be harsh in its impact on people, of course, we want to know. We are going to ask the GAO to study six things. First, we are going to ask the GAO to report on the impact of the bill on the number of filings under chapter 7 and chapter 13. This is important because the proponents of the bill have been something of a moving target on this issue. They argue that the point of the bill--particularly the means test--is to force more debtors who are now filing for chapter 7 into chapter 13--the logic being they can afford to do so. I have heard colleagues say that is the only thing this is about. People should not get away with filing chapter 7 when they really have the money and they can instead file for chapter 13. But then the American Bankruptcy Institute found that very few people abuse chapter 7. Perhaps as low as 3 percent do that. And then the chapter 13 trustees reported that this bill will actually reduce chapter 13 filings by 20 percent from the current level because of the problem through additional burdens that the bill creates for chapter 13 filers. Now, the proponents admit there may be fewer successful 13s. Also, I have argued that access to both chapters 7 and 13 are going to be reduced because of the means test and other burdensome requirements. Let's find out. Those of you who say you are for the bill, you say it is because people have been gaming the system, but the evidence doesn't support that claim. I have talked about who the people are. Fifty percent of the people file for bankruptcy because of medical bills, or people have lost jobs, or there has been a divorce. But what I am saying is, since now we know that, in fact, there may not be so much abuse, and that many people can't file successfully for chapter 13, and maybe even are less able to do so under this legislation, let's have a study. Let's look at this. Two years hence, let's look at how this has worked. How can anybody be opposed to a careful policy evaluation? Second, the GAO will look at chapter 13 specifically and the impact of this act on the number of plan confirmations in chapter 13 and the number of chapter 13 plans successfully completed. This is a key question because 67 percent of chapter 13 cases fail under current law. I will repeat that. Under current law, 67 percent of the people can't make it. If this legislation is going to make it even more difficult for people to make it, and this is what my colleagues call reform, what this amendment says is let's see what has happened. Let's see if I am right. Or forget me. Let's see if the U.S. Trustees are right, and if we aren't, no harm has been done. But if we are right, then perhaps the Congress might want to revisit this legislation. When it becomes clear that a lot of hard-working people, through no fault of their own, wound up in very difficult, hellish financial circumstances, and then could not rebuild their lives because of this legislation, don't you think we want to know? Colleagues, if you are right, you are right. But if you are wrong, you want to know if you are wrong. How can any Senator vote against this amendment? Third, the General Accounting Office will examine the impact on the cost of filing chapter 7 and chapter 13 bankruptcies in each State. This is another key question--whether or not this bill will allow debtors to get bankruptcy relief. There is overwhelming evidence that the cost of filing bankruptcy is a major hurdle. Some families are going to have to save for months in order to do it. They are, after all, insolvent. It is also a virtual certainty that this bill will make it more expensive to file, as the Wall Street Journal noted earlier this year. Again, let's hold ourselves accountable and have the General Accounting Office study this issue for certain. Fourth, the GAO will report on the impact of the bill on the availability and marketing of credit. Something very interesting happened in 1999 and 2000 while the proponents of so-called reform were bleating about the rising number of bankruptcies. The bean counters in the consumer credit industry realized that all these bankruptcies were not good for profits so they started lending less money, and they were more careful about who they lent the money to and, in fact, overall consumer debt level actually declined in 1998, and guess what. We had fewer bankruptcies. This trend continued to 1999 and 2000. Bankruptcies only started rising again as the economy started to turn downward. Several economists have suggested that when you restrict access to bankruptcy protection, as this bill does, you are going to increase the number of filings and defaults because the banks are going to be more willing to lend the money to marginal candidates because they do not have to worry about people then filing for bankruptcy. Indeed, it is no accident that that is exactly what happened after the bill was passed in 1984. As the May 21 issue of Business Week notes in an article titled ``Reform That Could Backfire": Indeed, [Mark] Zandi believes that tougher bankruptcy laws will simply induce lenders to ease their standards even more. States with the highest bankruptcy rates already have stringent wage garnishment laws, yet net losses to credit card issuers in such States have been similar to those in States following less restrictive bankruptcy rules. Let's see if the experts are right. Have the General Accounting Office do a study. Fifth, we want to look at the effective so-called reform bill on the price and terms of credit for consumers. What we hear by the credit card companies and proponents of these bills is that all of these bankruptcies have led to higher interest charges and fees for honest consumers. That is because, they say, the credit card companies and banks pass on the costs of the default to consumers. In fact, I remind colleagues, the credit card companies have calculated the cost of this tax on consumers to be $400 per year. This has been cited as a reason that we need reform. The decent, hard- working people are getting charged $400 more a year because of people who are the slackers and are gaming the system, although there are not very many slackers. Maybe this is all true, but it only matters in the context of the bill if passing this ``reform'' measure actually results in savings to consumers. By the way, there is not much evidence that is going to happen. Consider this: In 1999 and 2000, when bankruptcy rates and defaults were dropping sharply, interest rates and fees on credit cards were actually rising, and the bank and credit card lender profits were also rising. This suggests that if there were any savings, they were not passed on to consumers. If this industry is going to run the show, let's insist, after this bill passes, there are going to be these great savings for consumers. Let's just do a careful study of that. Sixth, the GAO will investigate the extent to which the bill impacts the ability of debtors below median income to obtain bankruptcy relief. I have heard colleagues say over and over that nothing in this bill will affect the ability of low-income debtors to get a fresh start. In fact, I heard the Senator from Alabama make that claim the other day. If that is the case and if the only thing this legislation is about is going after those people who are the slackers or the cheaters, then let's take a look at it. As I said before, there are a lot of provisions in this bill that are going to make it much harder for people to get a fresh start, and it has nothing to do with whether or not they were cheaters or slackers. I am talking about the people who have really been put under, no fault of their own. Let's have the GAO take a look at this question: Are we going to have a lot of debtors who are going to face these hurdles to filing regardless of their circumstances? Finally, there is one other part of this amendment. It directs the Director of the Office of U.S. Trustees to collect data on reaffirmation agreements, the identity of the creditors in such reaffirmations, and the type of debt that is reaffirmed. Under this bill, creditors will have more leeway to force reaffirmations--agreements where debtors reaffirm their intention to pay back the debt and so the debt is not wiped out in bankruptcy. Unfortunately, these agreements are commonly abused by creditors under current law. I talked about what happened with Sears, Roebuck. They paid $498 million in settlement damages in 1999 and $60 million in fines for illegally coercing reaffirmations--agreements with borrowers to repay debt--from its cardholders. Apparently this is just the cost of doing business. Bankruptcy judges in California, Vermont, and New York have claimed that Sears is still up to its old strong-arm tactics but is now using legal loopholes to avoid disclosure. This amendment will bring some transparency to the reaffirmations and allow us to study how they are being abused. This is a modest amendment. I have been fighting this bankruptcy bill for a long time, and other Senators have been out here fighting. If it is going to go to conference committee, then I am going to depend on Senator Leahy and others to improve this bill, although I think there is going to be a vote we are going to deeply regret. The most vulnerable people are the ones who are going to pay the price. The economy is turning downward and a lot of people may find themselves in terrible circumstances--no fault of their own--and are going to have a very difficult time rebuilding their lives. I am amazed that the credit card industry in institutional terms--not Senator to Senator. Every Senator votes how he or she thinks is right. I am saying can we not at least do an evaluation? Can we not at least make sure that 2 years from now we have the General Accounting Office do a study so we know what is happening around the country? If the proponents of this legislation are right and this truly was a reform and it truly works well and all of the harsh and negative consequences I have spent hours talking about do not turn out to be the case, I will be glad to be proven wrong. But for those of you who support this legislation, surely you also, first of all, want to be right, but if you are wrong and I am right, then you want to know you are wrong so you can change the course of policy. You do not want to see a lot of innocent people, ordinary citizens hurt by this legislation just because the large financial service industry has such clout. We all know about their power. We all know that this is one- sided. There is not a word in this legislation--I am sorry, on the Senate side, there is a minuscule piece on disclosure, but nowhere are they called into question or called into accountability. They pump this stuff out every day. I got one today. Credit line up to $100,000. Our children get it. Every day they send this stuff out in the mail. Every day they try to hook people on their credit, and we are arguing that when it comes to bankruptcy, the only people who are at fault are the people who wind up in trouble, not these big credit card companies for their irresponsible, reckless lending policies. Shouldn't we call on them to be more accountable? We have not. Shouldn't there be more balance to this legislation? There is not. Am I right that a lot of low- and moderate-income people are going to be hurt, that a lot of single-parent families headed by women are going to be hurt? Am I right that a lot of children who live in these families are going to be hurt? Am I right that a lot of families who have been put under because of medical bills are going to be hurt? Am I right that families--because the husband or the wife, the major wage earner, loses his or her job and finds themselves in terrible circumstances-- are going to be hurt? I think I am right. If I am wrong, I will be prayerfully thankful to be wrong. If I am right and you are wrong, you will want to know you are wrong so we can do something in a hurry before a whole lot of ordinary citizens get hurt very badly by this legislation. Every Senator should vote for this amendment. There is no reason to vote no. I ask for the yeas and nays.

Mr. WELLSTONE

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

Mr. WELLSTONE. Mr. President, we are going to have a vote in a moment. I understand the Chair ruled in my favor on the point of order. I am glad that the Chair did so. Let me be real clear about this amendment. There is no delay whatsoever. This is one amendment. There could be many amendments. This is one amendment. We have had Senators on both sides of this question. Some of us have argued very much in the positive about this legislation, and some of us have argued very much in the negative about this legislation. Let the General Accounting Office take a look at this 2 years from now and give us a careful evaluation about how it is working, look at its impact on chapter 7, look at its impact on chapter 13, look at its impact on low- and moderate-income citizens, look at its impact on children and single-parent families. That is all my amendment says. I say to colleagues, if I am wrong about this legislation, which I believe is unbelievably harsh, which I think is a testimony to the power of the financial service industry, I will be pleased to be wrong. But if my colleagues are wrong, they are going to want to know they are wrong. They are going to want to know what the impact is. I hope Senators will vote for this amendment. All it calls for is a General Accounting Office study. At the very minimum we should all be accountable for the vote we cast, and I believe that is what this amendment is about. The yeas and nays have been ordered. I hope colleagues will support it.

Mr. WELLSTONE. Mr. President, I say to my colleague from Utah, he is absolutely right, the legislation does call for some studies, but there is nothing in the legislation that calls for a GAO study of all of the issues I indicated which are terribly important in understanding whether this legislation works. That is all I am saying. Let's at least have a policy evaluation to see how this works. I certainly hope colleagues will support this amendment.

Mr. WELLSTONE. Mr. President, I move to reconsider the vote.

Mr. WELLSTONE

Mr. WELLSTONE. Madam President, I ask unanimous consent that Lauren Banks, who is a member of Senator Harkin's staff, be granted the privilege of the floor during the Senate's consideration of the bankruptcy bill.

Mr. WELLSTONE

Mr. WELLSTONE. I thank the Chair. Mr. President, if I could get the attention of the Senator from Alabama. Does the Senator from Alabama--does the minority need the floor right now to do some things? If so, I will be pleased to wait; otherwise, I am ready to go.

Mr. WELLSTONE. Mr. President, normally I do not do it this way. I try not to rely too much on notes. But I want to try to be as detailed and as thorough as I can because what I am asking the Senate to do today is to step back from the brink and decline to go to conference with the House on the so-called bankruptcy reform. I am going to be in this Chamber a number of times over the next week, maybe over the next several weeks. There is a lot that I want to say. There is a lot I think I should say as a Senator from Minnesota because I think Congress is about to make--or is headed toward--a very grave mistake. So I will not attempt to say it all today. What I will do, however, is to speak, at least in a broad way, about why I feel so strongly in the negative about this bill. I ask unanimous consent that several pages I have of titles of editorials about the bankruptcy bill be printed in the Record.

Mr. WELLSTONE. ``Bad Timing on the Bankruptcy Bill,'' Robert Samuelson, The Washington Post, March 14, 2001; ``A Bad Bankruptcy Bill,'' San Francisco Chronicle, March 15; ``A Debt Bill Bankruptcy of Decency,'' The Chicago Sun Times; ``Deeper Hole for Debtors,'' Los Angeles Times; ``Business Dictated Bankruptcy Law,'' New York Times; ``Congress, President Side with Banks, Not Consumers,'' The Atlanta Journal Constitution; ``Compounding Debt,'' The Boston Globe; ``A Bankrupt Law?'' Businessweek; ``Bankruptcy Overall Hits Needy as Well as Greedy,'' The Miami Herald; ``Congress Pushing Usury,'' Bismarck Tribune; ``Hammering Bankrupt Consumers,'' Chattanooga Times Free Press; ``Down on Your Luck? Tough,'' The Chicago Sun Times. These are just kind of random samples: ``Bankruptcy Bill is Anti-Family Measure,'' Intelligencer Journal; ``A Flawed Bankruptcy Bill,'' the Milwaukee Journal; ``Banking on Politics,'' the News Observer; ``In Bankruptcy Bill, Money Talks,'' the Oregonian; ``Why Campaign Finance Reform? Look at Bankruptcy Bill,'' the Palm Beach Post; ``Bankrupt Bill; This Reform Will Hurt Americans Who Are Struggling,'' Pittsburgh Post-Gazette; ``Bankruptcy Bill, So- Called Reforms Make Reckless Lending More Profitable,'' Sacramento Bee; ``Bankruptcy Bill Helps Guess Who?'' San Jose Mercury News; ``Bad Piece of Legislation,'' Buffalo News; ``Taking Care of Business,'' Bob Reich in the American Prospect. The list goes on and on. I have for over 2 years been fighting this bill, with some of my colleagues: Senators Kennedy, Boxer, Durbin, Schumer, Leahy, and Feingold. I will give myself a little bit of credit as to why we are still debating this bill and it has not passed. In truth, a great deal of the credit goes to the proponents of the bill because it has been their consistent refusal to compromise on the legislation that has made the job easier. I will go into some of the greedier aspects of this legislation in a moment. Some have argued that the tactics have been extreme, that I have been at this over and over and over again in trying to block it. I would rather be spending my time not stopping the worst but doing the better. I much prefer to do that. But this is a disastrous piece of legislation. What has been done with this very harsh legislation is basically shredding one of the important safety nets, not just for low- income people but for middle-income people as well. Shredding that safety net so that people can no longer rebuild their financial lives is truly egregious. To argue that the reason we need to do this is because a lot of people have been filing chapter 7 in order to get out of repaying their debt and that they are untrustworthy, they don't feel any stigma, et cetera, simply doesn't hold up under any kind of scrutiny. We know in the vast majority of cases, 50 percent of the people who file bankruptcy in this country file bankruptcy because of medical bills. Is somebody going to say they are lazy or they are slackers or cheats? We know beyond that one of the major causes of bankruptcy is loss of a job. More and more people are losing their jobs now; 1,300 taconite workers at LTV Company on the Iron Range of Minnesota just lost their jobs. Is it divorce? Not surprisingly, many of our citizens who find themselves in the most difficulty are women after a divorce. They are the ones who are taking care of the children in most cases. It hardly holds up that these are a bunch of slackers and a bunch of cheats we are going after. As a matter of fact, the evidence is clear-- I will refer to studies later on--that at best there is maybe 3 percent abuse. What about the other 97 percent of the people? Major medical illness is a double whammy because not only do you have to pay the doctor and the hospital charges, but in addition quite often you can't work. If it is your child, even if it is not you, it is the same issue: it is the medical bills. But then you are home taking care of the child. Now you have no other choice. You are trying to rebuild your life and file for chapter 7, and you can't do it any longer. As I said, you can't argue that people overwhelmed with medical debt or sidelined because of an illness are deadbeats. This legislation assumes they are. It would force them into credit counseling before they could file, as if a serious illness or disability is something that could be counseled away. I had an amendment to this bill that would have created an exclusion for people who were filing for bankruptcy because of medical bills. It did not pass. Women single filers are now the largest group in bankruptcy. They are one-third of all the filers. They are the fastest growing. Since 1981, the number of women filing increased by 700 percent. A woman single parent has a 500 percent greater likelihood of filing for bankruptcy than the population generally. Divorce is a major factor in causing bankruptcy in America. Are single women with children deadbeats? This bill assumes they are. The new nondischargeability of credit card debt will hit hard those women who use the cards to tide them over after a divorce until their income stabilizes. The ``safe harbor'' in the House bill, which proponents argue will shield low- and moderate-income debtors from the means test, will not benefit many single mothers who most need the help because it is based upon the combined income of the debtor and the debtor's spouse, even if they are separated, the spouse is not filing for bankruptcy, and the spouse is providing no support for her, for the debtor and her children. In other words, a single mother who is being deprived of needed support from a well-off spouse is further harmed by this piece of legislation which will deem the full income of that spouse available to pay debts for determination of whether the safe harbor and means test applies. It makes no sense whatsoever, and it is incredibly harsh. Over the past 2 years, any pretense that this piece of legislation is urgently needed has evaporated. Now proponents and opponents agree that nearly all the debtors resort to bankruptcy not to game the system but, rather, as a desperate measure of economic survival and that only a tiny minority of chapter 7 filers, as few as 3 percent, can afford any debt repayment, according to the American Bankruptcy Institute. Yet low- and moderate-income families, especially single-parent families, are those who need most the fresh start provided by bankruptcy protection. The bill will make it harder for them to get out from under the burden of crushing debt, and that is why I oppose it. The second reason why I oppose this legislation is that the timing of this bill could not be worse. Basically people are not going to be able to file for chapter 7. Chapter 13 is going to be made more unworkable for many debtors. We had a situation where 4 years ago, when we first started this debate, the big banks and credit card companies were pushing so-called bankruptcy reform in good economic times. The stock market was soaring. The unemployment rate was coming down. But given the economy we find ourselves with right now, given the fact that we no longer have the same boom economy, that people are now out of work or underemployed, that these are harder times, rushing this bill through seems completely divorced from reality. What is the most cited reason for filing for bankruptcy? Job loss, and the unemployment rate is rising. What is the second most cited reason? Excessive medical bills, and the cost of health care is rising, as are the number of uninsured. At the same time, we are going to make it impossible for people to file for chapter 7 and rebuild their lives. While the bill will be terrible for consumers and for regular working families even in the best of times, its effects will be all the more devastating now because we have a weakening economy. It boggles the mind that at a time when Americans are most economically vulnerable, when they are most in need of protection from financial disaster, we would eviscerate the major safety net in our society for the middle class, and that is precisely what this legislation does. It is the height of insanity that we would be contemplating doing what we are doing given this economy. It may be the case that the Congress and the President will ignore the plight of these families. Each one of them by themselves is not that powerful. Most folks assume this is never going to happen to us. Most people and most families never expect they are going to have to file for bankruptcy, but at least my colleagues should care about the effect on the economy. This bill could be a disaster, but I do not want you to take my word for it. I want to quote some excerpts from a column by Robert Samuelson in the March 14 Washington Post. To put it delicately, Mr. Samuelson and I rarely agree on anything. In fact, he likes--I want to be intellectually honest about it--he likes the substance of the bankruptcy bill. All the more reason, I say to my colleagues, to pay attention to him. The title of the editorial is ``Bad Timing on the Bankruptcy Bill.'' He writes: The bankruptcy bill about to pass Congress arrives at an awkward moment: the tail end of a prolonged boom in consumer borrowing. From 1995 to 2000, Americans increased their personal debts by about 50 percent to roughly $7.5 trillion-- a figure including everything from home mortgages to student loans. Now comes the bankruptcy bill, which would make it slightly harder for consumers to erase debts through bankruptcy. Although the bill is not especially harsh, it could perversely worsen the economic downturn. I do not agree with part of his characterization. I am now focusing on his argument about the effect of the economy. He concludes: The real pressures of high debt are now being compounded by scare psychology. ``Drowning in Debt,'' says the cover story of the latest U.S. News & World Report. ``Why you're in so deep--and how to get out before it's too late.'' The bankruptcy bill sends a similar message: Be prudent, don't overborrow. The message is now about four years too late. Now it may simply amplify the growing gloom. This is not a bad bill, but it certainly is badly timed. There you have it, I say to my colleagues. Not an opponent but a supporter suggesting that now is not the time, that we could end up prolonging or actually worsening the downturn in the economy. He is not the only one. A May 21 issue of Business Week had an article titled ``Reform that Could Backfire.'' The article begins: Just as bankruptcy reform seemed headed for certain passage, the economic omens point to a sharp rise in personal bankruptcies over the next few years. The likely results, says economist Mark Zandi of Economy.com, Inc., will be ``much pain for hard pressed households, little if any gain for lenders, and, in the event of even a mild recession, major problems for the overall economy.'' Again, this is not some leftwing rag; this is the magazine of note for corporate America--Business Week. If Business Week and Paul Wellstone are in agreement on an issue, then I ask you: How can we be wrong? The article concludes: The drop in bankruptcies in recent years partly reflected the booming economy. Now, with sharply rising unemployment and slowing income gains, Zandi expects high household debt to take its toll. Especially at risk, he believes, are lower income families, for whom debt repayment dictated by the pending bankruptcy reform would entail tremendous hardship. ``If the economy becomes mired in recession or sluggish growth,'' he warns, ``the loss of the spending power could significantly retard the recovery.'' I ask my colleagues, I ask the majority leader--I am not in agreement with him--what is the rush? Why do you want to do this to the economy? Why do you want to do this to families? Why are you prepared to go to such ridiculous lengths to move this legislation? Mr. President, I have received a note, I say to Senator Sessions, that he wants a few minutes before 9:30 a.m. I did not see it until just now. I will be pleased to yield to my colleague.

Mr. WELLSTONE. Whatever is best for the Senator from Alabama.

Mr. WELLSTONE. Mr. President, I do not really get this. One of the arguments being made is that what we are going to see is an increase in bankruptcies because of a slowing economy and high consumer debts that are overwhelming families and, therefore, we need to pass legislation to curb access to bankruptcy relief. Try that on for size. For 2 years, while the good times were rolling, the proponents of this bill were citing the number of bankruptcy filings as a reason to pass the bill, although there actually was a dramatic drop in filings taking place. I never understood that argument. Now they are turning around and saying we need to rush to do this because the economy is slowing down and many hard-working people, through no fault of their own, are going to find themselves in dire circumstances; therefore, we had better pass legislation that will curb their access to bankruptcy relief. It is amazing: Increasing hard times, a lot of people finding themselves in these impossible financial circumstances, and now they want to make it harder for them to get a fresh start. The logic of this argument completely escapes me. The point Mark Zandi makes in the Business Week article, as other economists have done, is that restricting access to bankruptcy protection will actually increase the number of filings and defaults because banks will be more willing to lend to marginal candidates. Indeed, it is no coincidence that the single largest surge in bankruptcy filings began immediately after the last major procreditor reforms were passed by Congress in 1984. This is not a debate about winners and losers because we all lose if we erode the middle class in this country. We lose if we take away one of the critical underpinnings for middle-class people. Sure, in the short run big banks and credit card companies may pad their profits, but in the long run our families will be less secure and our entrepreneurs will become more risk adverse and less entrepreneurial. The whole point of bankruptcy is to allow people to get a fresh start. Bankruptcy disproportionately affects the financially vulnerable, but it also disproportionately affects the risk takers, small businesspeople or entrepreneurs. Our bankruptcy system ensures that utter insolvency does not need to be a life sentence, but it can be an opportunity to start over, and that is what this bill erodes. This is not a debate about reducing the high number of bankruptcies. No one can will a piece of legislation that can do that. Indeed, by rewarding--I make this argument--the reckless lending that got us here in the first place, we are going to see more consumers burdened with that. It is amazing; there is hardly a word in this whole piece of legislation that calls for these credit card companies or lenders to be accountable as they continue to pump this stuff out to our children and grandchildren every day of every week. But this is perfect for them because they don't have to worry any longer. They get a blank check from the Government. No, this is a debate about punishing failure-- whether self-inflicted--and sometimes it is--or uncontrolled or unexpected. This is a debate about punishing failure. If there is one thing this country has learned, it is that punishing failure doesn't work. You need to correct mistakes. You need to prevent abuse. But you also need to lift people up when they have stumbled, not beat them down. This piece of legislation beats them down. Both the House and Senate bills basically give a free ride to the banks and credit card companies, that deserve much of the credit--you would not know it from this legislation--for the high number of bankruptcy filings because of their loose credit standards. Even the Senate bill does very little to address this issue. There are some minor disclosure provisions in the Senate bill. But even these don't go nearly as far as they should. Lenders should not be rewarded for reckless lending. Where is the balance in this legislation? If we are holding debtors accountable, why don't we hold lenders accountable as well? I know the answer. These financial interests have hijacked this legislative process. As high-cost debt and credit cards and retail charge cards and financing plans for consumer goods have skyrocketed in recent years, so have the bankruptcies. As the credit card industry has begun to aggressively court the poor and vulnerable, is anybody surprised that bankruptcies have risen? Credit card companies brazenly dangle literally billions of dollars of credit card offers to high-debt families every year, and they are not asked to be accountable. They encourage credit card holders to make low payments toward their card balances, guaranteeing that a few hundred dollars in clothing or food will take years to pay off. The length to which the companies go to keep customers in debt is absolutely ridiculous, and they get away with murder in this legislation. After all, debt involves a borrower and a lender. Poor choices or irresponsible behavior by either party can make the transition go sour. So how responsible has the industry been? It depends on how you look at it. On the one hand, consumer lending is unbelievably profitable, with high-cost credit card lending the most profitable of all, except for perhaps the even higher costs on payday loans. We don't go after any of these unsavory characters. So I guess by the standard of the bottom line, they are doing a great job. This industry is thriving. These credit card companies are making huge profits. On the other hand, if your definition of responsibility is promoting fiscal health among families, educating them on the judicious use of credit, ensuring that borrowers do not go beyond their means, then it is hard to imagine how the financial services industry could not be a bigger deadbeat. The financial services industry is the big deadbeat. The problem is that it is the heavy hitter, the big giver, and it has so much money that it dominates the politics in the House of Representatives and the Senate. That is part of what this is about. Theresa Sullivan, Elizabeth Warren, and Jay Westerbrook wrote a book called ``Fragile Middle Class.'' I recommend it to everybody. They write: Many attribute the sharp rise in consumer debt--and the corresponding rise in consumer bankruptcy--to lowered credit standards, with credit cards issuers aggressively pursuing families already carrying extraordinary debt burdens on incomes too low to make more than minimum repayments. The extraordinary profitability of consumer debt repaid over time has attracted lenders to the increasingly high risk-high profit business of consumer lending in a saturated market, making the link between the rise in credit card debt and the rise in consumer bankruptcy unmistakable. Credit card companies perpetuate high interest indebtedness by requiring--and there is not a Senator who can argue against this practice--low minimum payments and, in some cases, canceling the cards of customers who pay off their balance every month. Using a typical monthly payment rate on a credit card, it would take 34 years to pay off a $2,500 loan. Total payments would exceed 300 percent of their original principal. That is really what this is all about. A recent move by the credit card industry to make the minimum monthly payment only 2 percent of the balance rather than 4 percent further exacerbates the problem of some uneducated debtors. These lenders routinely offer ``teaser'' interest rates which expire in as little as 2 months, and they engage in ``risk-based'' pricing which allows them to raise credit card interest rates based on credit changes unrelated to the borrower's account. It is just unbelievable what they get away with. Even more ironic, at the same time that the consumer credit industry is pushing a bankruptcy bill that requires credit counseling for debtors, the Consumer Federation of America found that many prominent creditors have slashed the portion of debt repayments they shared with credit counseling agencies--in some cases by more than half. This may force some of these agencies to cut programs and serve even fewer debtors. Well, Mr. President, I am sorry. I am glad there aren't a lot of Senators on the floor because it is hard to say this because you feel as if you are engaging in personal attacking. I don't mean it to be that way. I can't say enough about the hypocrisy of this legislation-- not of individual Senators but the content of this legislation. It is incredible to me the way in which these banks and credit card companies have rigged this system, and we have this harsh piece of legislation in increasingly difficult economic times that is going to make it impossible for many families to rebuild their lives. The vast majority find themselves in these horrible circumstances because of medical bills, having lost their jobs, or divorce. Do you know what. This legislation doesn't do anything about the egregious greed, the exploitive practice of this industry. All of us who have children know what they send out in the mail every day. So the question is: Paul, if the bill is as bad as you say, how come it has so much support? This is a lonely fight. Just a few Senators are in strong opposition. I don't mean it in a self-righteous way, and it doesn't make us closer to God or the angels. I don't understand why the bill is going through. The bill has a lot of support in the Congress, and some of those who are supporting it, such as Senator Sessions and others, are worthy Senators. We have an honest disagreement. The President says he supports it. But the fact of the matter is--and I am not talking about a specific Senator; I don't do that because that is not what it is really about. At the institutional level, I believe the reason this legislation has so much support--I will repeat that--at the institutional level, I believe the reason this legislation has so much support is that it is a tribute to the power and the clout of the financial services industry in Washington. Let's call it what it is. Might makes right. It is the financial might of the credit card companies and the big banks that are big spenders, heavy hitters, and investors in both political parties. It doesn't mean individual Senators support this legislation for that reason. I can't make that argument. People can have different viewpoints. But if I look at it institutionally, I can look at the amount of money those folks deliver, their lobbying coalition, and the ways in which they march on Washington every day, and I can't help but say that is part of what this is about. Why has the Congress chosen to come down so hard on ordinary working people down on their luck? How is it that this bill is so skewed against their interests and in favor of big banks and credit card companies? These editorials in a lot of newspapers that say the Congress--the House and Senate--comes down on the side of binge banks, not consumers, are right. Well, maybe it is because these families don't have million-dollar lobbyists representing them before the Congress. They don't give hundreds of thousands of dollars in soft money to the Democratic and Republican Parties. They don't spend their days hanging outside the Chamber to bend a Member's ear. Unfortunately, it looks as if the industry got to us first. The truth is that, outside of this building, the support for this bill is a pittance. I mean the truth of the matter is that if you go outside this building, support for this bill is very narrow. The support has deep pockets. Apparently the Congress responds to deep pockets--not apparently; it does. Everybody knows that. People know it in Nebraska; they know it in Alabama; they know it in Minnesota. We can agree or disagree about this legislation, but that is the view people have. They say when it comes to our concerns about ourselves and our families, our concerns are of little concern in Washington. Part of that is the mix of money in politics. That is why the vote in the House is important and why everybody should know that McCain-Feingold and Meehan-Shays is just a step. Lord, we will have to do much more. I am trying to win on a cloture vote on which I will get beat badly. Outside of this building, and I will stake my reputation on this--I hope I have a reputation--outside this building there is no support for this, or very little. People are not running up to us in coffee shops in Nebraska and saying, please pass that bankruptcy bill because, by God, that is the most important thing you can do that will help us. People are talking about health care costs, childcare costs, good education for their children, a fair price for family farmers, how we can keep our small businesses going, the cost of higher education, the cost of prescription drugs, concern people will not have a pension, what happens when you are 75 or 80, in poor health, and you have to go to the poorhouse before you get help in a nursing home or home-based care and receive medical assistance. That is what people talk about. They don't say, please pass a bankruptcy bill so when we get into trouble, no fault of our own, because of medical bills or we lost our jobs, we will not be able to rebuild our lives. There isn't any support for this legislation outside this building. The deep pocket folks got to the Congress first, as they usually do. There is opposition. You can know something about a bill by who the enemies are. Labor unions oppose the bill. Consumer groups oppose the bill. Women and children's groups all oppose the bill. Civil rights organizations all oppose the bill. Many members of the religious community oppose the bill. Indeed, it is a fairly broad coalition that opposes this. Behind them are millions of working families who have nothing to gain and everything to lose from this legislation. That is why I have been blocking this bill for over 2 years. I come from the State of Minnesota. We had a great Senator and Vice President, Hubert Humphrey. He once said that the test of a society or the test of a government is how we treat people in the dawn of life, the children, in the twilight of their lives, the elderly, in the shadow of their lives, people who are poor, people who are struggling with an illness, people struggling with a disability. By this standard, this bill is a miserable failure. There is no doubt in my mind this is a bad bill. It punishes the vulnerable and rewards the big banks and credit card companies for their own poor practices. For all I know this legislation will only get worse in conference. I hope that is not the case but it is my fear. Earlier I used the word ``injustice'' to describe this bill. That is exactly right. It would be a bitter irony if creditors used a crisis, largely of their own making, to talk Congress into this legislation. Colleagues, it is not too late to reverse the course of the bill. It is never too late to pull back from the brink until we have leaped. We have not leaped yet. Let's step back. Let's do reform the right way. Let's wait until we are not adding to the economic pain that too many American families are already feeling. Let's not prolong the pain. I urge the Senate to change the course. If I lose on this vote, then we will have to have another cloture vote, which will be next week, and there will be more discussion. From there, we will see. I ask unanimous consent a number of editorials from newspapers all across our country be printed in the Record.

Mr. WELLSTONE. While I have the floor, I ask unanimous consent that my following remarks be included as part of morning business.

Mr. WELLSTONE. Madam President, I heard the Senator from Alabama, and I believe I heard the Senator from Utah as well, say that the core of the bill is the means test, and all the means test does is force people to go into chapter 13. Therefore, the benefit doesn't affect low-income people, contrary to what I have said in this debate. The means test is only 9 pages out of a 200-page bill. If the means test was all this bill consisted of, then this bill would have passed 2 years ago or 2\1/2\ years ago. The bankruptcy bill purports to target abuses of the bankruptcy code by wealthy scofflaws and deadbeats who make up, by the way, 3 percent of all the filers, according to the American Bankruptcy Institute. Yet hundreds of thousands of Americans file for bankruptcy every year, not gaming the system--I need to say it more times--but because they are overwhelmed with medical bills. Unfortunately, there are at least 15 provisions in S. 420 that make it harder to get a fresh start, regardless of whether the debtor is a scofflaw or a person who must file because they are made insolvent because of their medical debt or because they have lost their jobs or because of a divorce in the family and they are now a single parent with children. These measures not only include but also are in addition to the means test. If the means test was the whole piece of legislation, it would be quite a different story. Neither the means test nor the safe harbor in the bill apply to the vast majority of new burdens that are placed on debtors. Under S. 420, debtors will face these hurdles to filing regardless of their circumstances. An analysis in the Wall Street Journal last week put it this way. These are not my words: The bill is full of hassle-creating provisions, some reasonable, and some prone to abuse by aggressive creditors trying to get paid at the expense of others. In a thicket of compromises, Congress is losing sight of the goal of making sure that most debtors pay their bills while offering a fresh start to those who honestly can't. That is the Wall Street Journal analysis. This amendment will preserve the fresh start for those debtors who honestly can't make it because they are drowning in medical debt. My colleague from Alabama said this is a bankruptcy bill. It only deals with the bankruptcy code and bankruptcy court reform, including banking measures targeted at credit card companies that Senator Wellstone suggested is inappropriate. Why is it inappropriate? If the point of this legislation is to reduce bankruptcy, then it would seem to me that we might want to take a look at the big banks and credit cards that have been pushing for their legislation. They are the only ones pushing for this legislation. You are hard pressed to find a bankruptcy judge that supports this legislation. You are hard pressed to find a bankruptcy law professor, a bankruptcy expert of any kind, anywhere, any place in the U.S.A. that backs this bill. This bill was written for the lender. It is that simple. That is why this piece of legislation doesn't hold them accountable. It has basically been written for them. It is ridiculous on its face that this legislation divorces irresponsible behavior of the credit card companies from the high number of bankruptcies. All of the evidence points to the fact that lenders and their poor practices are a big part of the problem. It is outrageous that we don't confront them. There isn't a parent in this country that is not well aware of the ways in which these credit card companies are constantly pushing these loans onto our children or onto our grandchildren. Everybody knows we are bombarded with it all the time. Both the House and Senate bills basically give a free ride to banks and credit card companies that deserve much of the blame for the high number of bankruptcies because of their loose credit standards. But even the Senate bill does very little to address this issue. There is a minor disclosure provision, and that is it. It is pathetic. Lenders should not be rewarded for reckless lending. Where is the blame? If we are holding the debtors accountable, why aren't we holding the lenders accountable? Again, I want to make the argument one more time. I think we know the answer. This legislation has the support of a lot of people, and the President says he supports it. As a matter of fact, there are going to be precious few votes against cloture. I am going to come back out here next week again and try to delay this bill. I am not arguing one-to-one correlation of any one Senator's vote on this legislation, but at an institutional level in terms of, if you will, where the mobilization of bias is. It seems to me it is crystal clear that this legislation is a tribute to the power and clout of the financial service industry in Washington. Let's call it what it is. This legislation is a tribute to the power and the financial might of the industry that has plowed millions and millions of dollars into this Congress. Why has Congress come down so hard on ordinary folks who are down on their luck? Why is it that this legislation is so skewed towards the interest of big banks and big credit card companies? I think the people who are going to be affected in a very harsh way are the 50 percent who file for bankruptcy because of medical bills. It is a double whammy--a medical bill you can't afford to pay, and maybe you can't work because of your illness or sickness or maybe it is your child's sickness or illness. A large part of the rest are people who are either out of work or because of the dramatic rise in single adult households by women because of divorce with children. Do you want to say these people are deadbeats? I think these families just do not have these million-dollar lobbyists representing them. They do not get hundreds of thousands of dollars in soft money such as either the Democratic Party or the Republican Party. They do not spend their days hanging outside the Senate Chamber to bend a Member's ear. I think what happened is the industry just got to us first. The truth is--and I will conclude on this note--outside this building there is hardly any support for this legislation. It is a bad bill. It punishes the vulnerable and rewards the big banks and credit card companies for their poor practices. I will tell you something. I am just trying to delay this, and then we will do it again next week. There are going to be very few votes, but I will say, even to my colleague from Iowa, who I insist is probably one of the best Senators in the Senate--I believe that; otherwise, I would not say it--this bill makes no sense to me. First of all, it made no sense to me when we started on this issue a number of years ago because the arguments were sort of outpaced by the data because all the bankruptcies supposedly were taking place. We were chasing a problem that did not exist, according to all the studies. Now we are heading into difficult times. We are heading into hard economic times. More people are losing their jobs and medical costs are going up. We are going to make it hard for people to rebuild their lives. We are going to make it hard for people to rebuild their financial lives. This piece of legislation is too one-sided, and it is too harsh. I will tell you, it is just testimony to the power of this industry. I do not do any damage to the truth when I say that when I am in a coffee shop in Minnesota, I do not--I repeat this again--have people running up to me saying: Please, Senator Wellstone, pass that bankruptcy ``reform'' bill because we think you ought to go after all the deadbeats and all the people cheating, although you have no evidence to support that you have a lot of cheaters--not when 50 percent of the people who file it do so because of medical bills, with more and more people losing their jobs, and, as I say, the most dramatic rise is among single adult women who head households. People do not come up to me and say: Please, do that. They want to talk about the health care costs going up. They want to talk about a fair price, if they are farming. They want to talk about their children and education. They want to talk about the struggle to find a good job that pays a good wage so they can support their families. They want to talk about the costs of higher education. They want to talk about their concern that they will not have a pension. That is what they want to talk about. What in the world is the Senate doing making this a priority? The folks with the clout, with the power, and with the money got here first. I think that is what this is all about. I am going to continue to oppose this legislation. I yield the floor and I suggest the absence of a quorum.

Mr. WELLSTONE

Mr. WELLSTONE. I say to my colleague, I think colleagues are expecting a vote at 12. I yield the next 15 minutes to the Senator from Vermont if he wants it.

Mr. WELLSTONE

Mr. WELLSTONE. Madam President, I ask consent to engage in a colloquy with my distinguished colleague from West Virginia, the chairman of the Appropriations Committee and of its Subcommittee on Interior. The purpose is to discuss two items in the bill which relate to the management and vitality of national forests in my state of Minnesota-- specifically, the Superior and Chippewa National Forests. The chairman and the subcommittee have done a very commendable job in the bill of providing needed funding for the continued multiple uses of our national forests. I would like to draw his attention to two provisions important to Minnesota. First, as my colleague knows, on July 4, 1999, both the Superior and Chippewa National Forests bore the brunt of a massive, once-in-a- thousand years wind and rain storm that devastated parts of northern Minnesota. The storm damaged over 300,000 acres in seven counties, including as much as 70 percent of the trees in our national forests, and it washed out numerous roads. The damage severely hindered the U.S. Forest Service's ability to responsibly manage both the Chippewa and Superior National Forests. The ``blowdown'' of trees created extreme risk of catastrophic fire due to the amount of downed and dead timber. Yet while the storm has changed affected portions of the forests for years to come and has created new risks and experiences for visitors and residents, officials from the Superior and Chippewa National Forests officials have been working with state, county, and local officials on storm recovery activities and planning to meet future needs. Key to that recovery is help provided last year in this bill. The Senate last year provided $14 million for efforts that continue today. I was pleased to work with the chairman, and I still appreciate his support at that time. At the same time, there remains a dangerous fire threat in Superior and Chippewa, and the Forest Service plans to continue their recovery work there through fuel reduction, reforestation and general rehabilitation. The bill before us contains increased general funding for such management, recovery and rehabilitation, and I would seek my colleague's assurance that it is his understanding that an adequate portion of that funding will allow the Superior and Chippewa National Forests to continue their crucial efforts.

Mr. WELLSTONE. I thank my colleague. The second item I would like to mention is that both the Superior and Chippewa National Forests are currently working to complete their forest management plans. The existing plans for these two forests, last revised in 1986, guide the forests' multiple use missions and lay out goals for habitat protection, resource production, soil protection and other aims. The National Forest Management Act requires an update of forest plans every 10-15 years. The Chippewa and Superior National Forests are now jointly revising their plans. This process allows efficient public participation rather than two parallel processes. It also provides greater consistency in resource management between the forests. Substantial public involvement has already helped develop the purpose and need for revising the plans, defining the issues and building a preliminary set of alternatives. The forests have ongoing consultation with four Minnesota Bands of Ojibwe, the Minnesota Department of Natural Resources, seven adjacent counties, as well as various interested stakeholders. The current forest planning work includes incorporating a required species viability evaluation initiated during 2000. While the 1986 forest plans continue to provide direction during the revision process, with ongoing public involvement, a final environmental impact statement and revised forest plans are expected in next year. Again, I am seeking my colleague's reassurances that sufficient land management planning funds in this bill should be available to the Superior and Chippewa National Forests to allow for full revision of their forest plans?

Mr. WELLSTONE. Mr. President, I am pleased to support the provisions in this bill that enhance the Steel Loan Guarantee program. The changes adopted today will provide invaluable assistance to our nation's steel companies as they strive to stay afloat in the face of overwhelming surges of finished and semi-finished steel imports. As you know, our domestic steel industry finds itself reeling from record import surges. Numerous companies are either in bankruptcy, have filed for bankruptcy, or are on the verge of doing so. On the Iron Range in my home state of Minnesota, for example, citing poor economic conditions, LTV Steel Mining Company halted production at the Hoyt Lakes mine, leaving 1400 workers out of work and affecting another 5000 additional workers as well. These are hard working people who want desperately to work the trades they were trained for and have been doing for generation upon generation. The changes we are making today in the Steel Loan Guarantee program will make it easier for companies to access much needed capital. In particular, we are increasing the loan coverage for a portion of the loans under this program from 85 percent to 95 percent and extending the duration of financing from 5 to 15 years. These changes represent one component of S. 957, the comprehensive Steel Revitalization Act of 2001 that I, along with Senator Byrd, Senator Dayton and others introduced earlier this year. I am pleased that we are taking the opportunity today to move a portion of this comprehensive measure. And I will continue to press this passage of the remaining elements of this much-needed legislation.