Providing for Consideration of S. 1920, Bankruptcy Abuse Prevention and Consumer Protection Act of 2003
PROVIDING FOR CONSIDERATION OF S. 1920, BANKRUPTCY ABUSE PREVENTION AND CONSUMER PROTECTION ACT OF 2003 -- (House of Representatives - January 28, 2004)
Mr. SESSIONS. Mr. Speaker, by direction of the Committee on Rules, I call up House Resolution 503 and ask for its immediate consideration.
The Clerk read the resolution, as follows:
H. Res. 503
Resolved, That at any time after the adoption of this resolution the Speaker may, pursuant to clause 2(b) of rule XVIII, declare the House resolved into the Committee of the Whole House on the state of the Union for consideration of the bill (S. 1920) to extend for 6 months the period for which chapter 12 of title 11 of the United States Code is reenacted. The first reading of the bill shall be dispensed with. General debate shall be confined to the bill and the amendments made in order by this resolution and shall not exceed one hour equally divided and controlled by the chairman and ranking minority member of the Committee on the Judiciary. After general debate the bill shall be considered for amendment under the five-minute rule. It shall be in order to consider as an original bill for the purpose of amendment under the five-minute rule an amendment in the nature of a substitute consisting of the text of H.R. 975 as passed by the House. That amendment in the nature of a substitute shall be considered as read. All points of order against that amendment in the nature of a substitute are waived. No amendment to that amendment in the nature of a substitute shall be in order except those printed in the report of the Committee on Rules. Each such amendment may be offered only in the order printed in the report, may be offered only by a Member designated in the report, shall be considered as read, shall be debatable for the time specified in the report equally divided and controlled by the proponent and an opponent, shall not be subject to amendment, and shall not be subject to a demand for division of the question in the House or in the Committee of the Whole. All points of order against such amendments are waived. At the conclusion of consideration of the bill for amendment the Committee shall rise and report the bill to the House with such amendments as may have been adopted. Any Member may demand a separate vote in the House on any amendment adopted in the Committee of the Whole to the bill or to the amendment in the nature of a substitute made in order as original text. The previous question shall be considered as ordered on the bill and amendments thereto to final passage without intervening motion except one motion to recommit with or without instructions.
SEC. 2. If the Senate bill, as amended, is passed, then it shall be in order to move that the House insist on its amendment to S. 1920 and request a conference thereon.
The SPEAKER pro tempore. The gentleman from Texas (Mr. Sessions) is recognized for 1 hour.
Mr. SESSIONS. Mr. Speaker, for the purpose of debate only, I yield the customary 30 minutes to the gentleman, my friend, from Massachusetts (Mr. McGovern), pending which I yield myself such time as I may consume. During consideration of this resolution, all time yielded is for the purpose of debate only.
Mr. Speaker, the resolution before us today is a fair rule that provides 1 hour of general debate on the bill and on the amendments made in order under the rule to be equally divided and controlled by the chairman and ranking minority member of the Committee on the Judiciary. It provides that it shall be in order to consider as an original bill for the purpose of amendment under the 5-minute rule a substitute amendment consisting of H.R. 975 as passed by the House, and it shall be considered as read.
The rule waives all points of order against the amendment in the nature of a substitute and makes in order only the amendments preprinted in the Committee on Rules report. It provides that the amendments made in order may be offered only in the order printed in the report and may be offered only by a Member designated in the report, and shall be considered as read and debatable for the time specified in the report, equally divided and controlled by the proponent and an opponent.
The rule also provides that these amendments shall not be subject to amendment and shall not be subject to a demand for a division of the question in the House or in the Committee of the Whole. It waives all points of order against the amendments preprinted in the report, provides one motion to recommit with or without instructions, and provides that if the Senate bill, as amended, is passed, then it shall be in order to move that the House insist on its amendment to S. 1920 and to request a conference thereon.
Mr. Speaker, I am pleased today that this House will have the opportunity to once again during the 108th Congress consider and send to the Senate much-needed bankruptcy reform legislation under this fair rule. I am proud of the tireless efforts on behalf of many Members and their staffs, who have put in countless hours towards the passage of this legislation over the last four Congresses.
Their efforts allow us today to again urge Senate action to ensure that our Nation's bankruptcy laws operate fairly, efficiently, and free of abuse. Congress has the opportunity to once again end, once and for all, the loophole to debtors who are able to repay some portion of their debts to game the system and increase the cost of credit, goods and services for other law-abiding citizens. Between 2002 and 2003, the Federal court system reported that there was a 9.6 percent increase in bankruptcy filings to over 1.650 million filings, and these filings have a real cost not only to every consumer but also to simple, everyday Americans.
In 1998, debtors who filed for bankruptcy relief discharged more than $44 billion of debt. When amortizing on a daily basis, this amounts to a loss of at least $110 million every day; or put more simply, bankruptcies cost each American family that pays their bills on time $450 a year in the form of higher costs for credit, goods and services. As the other body continues to stall on this legislation to protect the system from further abuse, these numbers and totals only continue to mount.
It has been estimated that if current practices continue, one out of every seven households will have filed for bankruptcy by the end of this decade, with many of these losses as a result of the misuse of the law by irresponsible, high-income filers. The Credit Union National Association, known as CUNA, reported last year that credit unions have lost nearly $3 billion from bankruptcies since Congress began considering bankruptcy reform legislation in 1998.
We should not forget the other indirect costs associated with bankruptcy fraud. Because the law currently allows people to game the system for their own benefit, the number of Federal bankruptcy filings per judgeship has increased from 71.1 percent, from 2,998 per Federal judge in 1992 to 5,130 in 2003, the largest caseload in our Federal court system. This backlog in this workflow slows down the progress for a countless number of legitimate bankruptcy filings and increases disrespect for the entire judicial system.
This bill is crafted to ensure the debtor's right to a fresh start while protecting the system from flagrant abusers by those who can, should, and, we believe, will be paying their own bills. Bankruptcy should not be a convenience or just another financial planning tool, and this legislation will ensure that it will remain a safety net for those who genuinely need it while trying to prevent bad actors from imposing their costs on everyone else.
Congress has spoken on this issue many times before.
As is widely known, Mr. Speaker, the 105th, 106th and 107th Congresses passed legislation addressing bankruptcy reform. In the 105th Congress, the conference passed the House, but time expired before the Senate voted on final passage. In the 106th Congress, a conference report received overwhelming bipartisan support in both Chambers. However, President Clinton chose to pocket veto the bill. In the 107th Congress, and again earlier this last year, we came extremely close again to the final passage of a conference report; but in the end, it was not accomplished.
Today, due to the outstanding work and leadership of our Committee on the Judiciary chairman, the gentleman from Wisconsin (Mr. Sensenbrenner), we have the historic opportunity to make modern bankruptcy reform a reality.
As we debate and vote today, we should keep in mind the two important tenets fulfilled by this version of bankruptcy reform. First, the bankruptcy system should provide the amount of debt relief that an individual needs, no more and no less; and that bankruptcy should be a last resort and not a convenient response to a financial crisis.
One important part of this legislation that I would like to highlight is also known as the "homestead provision." Protection of one's homestead is something that is very important to me and many people in Texas and other States across this great Nation. The homestead provision in this legislation maintains the long-held standard that allows States to decide if a homestead should be protected, yet prohibits those who would purchase a home before filing a bankruptcy as a means to
evade creditors. By tightening our current laws and making it more difficult to escape fraud by declaring bankruptcy, we are expressing no tolerance for those who would game the system to make up for their own wrongdoing.
Modern bankruptcy reform has taken a long and somewhat arduous journey, which makes the much-anticipated result of our work today even more rewarding. It has required not only hard work but also some difficult decisions on the part of this Congress. The result is what I believe to be a carefully balanced package that protects women, children, family farmers, low-income individuals, and provides access to bankruptcy for all Americans who have a legitimate need.
I believe that today's vote will finally make modern bankruptcy reform a reality.
Mr. Speaker, I urge my colleagues to vote with me in supporting this rule and the important underlying legislation.
Mr. Speaker, I reserve the balance of my time.
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Mr. SESSIONS. Mr. Speaker, I reserve the balance of my time.
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Mr. SESSIONS. Mr. Speaker, will the gentleman yield?
Mr. McGOVERN. I yield to the gentleman from Texas.
Mr. SESSIONS. Mr. Speaker, the fact of the matter is that we are intensely interested in passing this piece of legislation today, moving it to the Senate, believing that our colleagues on the other side of the building will see the wisdom of this bill and move this very expeditiously. This is to make permanent relief for farmers. I believe that the wisdom of the entire bill will be seen by that body, and then we will be able to have it on the President's desk very quickly for signature.
Mr. McGOVERN. Mr. Speaker, I appreciate the gentleman's spin; but we passed this bankruptcy reform bill last March, and the other body has not moved on our version because they have some problems with it. If I am interpreting the statements in the press from the other body correctly, there are Members who will filibuster this. For the bill to move forward in the face of the filibuster, the other body needs to muster 60 votes, which I am told from reliable sources they do not have.
That is why I ask the question if those on the gentleman's side of the aisle know something that we do not know. If those press accounts are true, what we are doing here is not helping small family farmers, we are just going through the motions. This is a big waste of time for everybody.
My suggestion would be that we should move forward with relief for family farmers. We know that will pass here easily and will pass the other body swiftly. We could send it to the President today and we have done something good rather than engage in this type of politics.
Mr. SESSIONS. Mr. Speaker, will the gentleman yield?
Mr. McGOVERN. I yield to the gentleman from Texas.
Mr. SESSIONS. Mr. Speaker, time after time after time sitting in the Committee on Rules, we hear about all of the pieces of legislation that will never go anywhere and will never move. We have heard this about bankruptcies many times, about our budgets; and we have heard this about bills that are related to welfare reform and tax bills. It is amazing how often the other body and whoever sits as our great President, whether it be President Clinton or President Bush, have found the ability and a way to work with the leadership of both bodies. That is part of what this experiment is about.
We have great confidence that the American people, who are the special interests to each and every one of us, the special interests and the needs of farmers and the needs of Americans, will be heard by our President, by each Member of the Senate and this body; and that is why we are moving this legislation forward.
I do not think that we would ask someone ahead of time what they are going to do with that, but rather to allow them the chance to debate and work through the changes. Compromise happens all of the time.
Mr. McGOVERN. Mr. Speaker, reclaiming my time, I guess that answer means, no, we do not have assurance from the other body that they will move on this; and, no, we cannot give assurances to the family farmers who are watching us here today that in fact the relief that they seek will be enacted anytime soon.
My follow-up question will be if the gentleman gets his way and his leadership gets its way and this bill moves forward with the House-passed bankruptcy reform bill attached to it, it goes over to the other body and they decide to filibuster it, is there agreement on how long we are going to wait until we help our family farmers, or will this go on indefinitely?
Mr. SESSIONS. Mr. Speaker, will the gentleman yield?
Mr. McGOVERN. I yield to the gentleman from Texas.
Mr. SESSIONS. The American people will have a lot to say about that as they talk with Members of the other body; and based upon that wisdom and as a result of what the leadership does, we will catch a good signal. We believe it will be on their agenda, and we are proud of what we are doing.
Mr. McGOVERN. Mr. Speaker, I thank the gentleman for his response; but it is not satisfactory, not only to those of us on this side of the aisle, but to those who may be watching this who are hopeful that we will actually do something of substance and that we will help family farmers looking for relief.
Mr. Speaker, the problem here is that we have an opportunity to do something good, to actually help some people; and we are turning this into political theatrics. I think that is unfortunate. I oppose the rule.
Mr. Speaker, I yield back the balance of my time.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
I appreciate what the gentleman is saying. I appreciate that he wants to know what the agreements are between the bodies as they work together. I respect that, but I would say to the gentleman that I respect more the 315 votes from this body that chose to speak on the subject the last time we voted.
Perhaps it is true there are some frustrations that come about as a result of the business which we engage in. Certainly there are frustrations that 315 people, time after time after time that vote for this important bill, are thwarted in the process; but I believe rather than becoming frustrated, it is up to us to think through how we will accomplish those things that are necessary, to retry, to renegotiate, to do those things that are dealing with negativism of, oh, it will never happen, to keep searching, and that is what the gentleman from Wisconsin (Mr. Sensenbrenner), the chairman of the Committee on the Judiciary, has done. He looked at a piece of legislation with 315 vote, and knew how important it was. Rather than accepting a defeatist mentality, he took the attitude he would be proactive and work on behalf of our special constituencies that all of us as Members of Congress have, the American people.
Mr. Speaker, 315 votes is a clear and simple overwhelming majority of this body. I am proud of what we are doing. Obviously, what we are trying to do here is to make sure that we pass this bill. Since 1986, this ad hoc approach which has talked about reauthorizing chapter 12 relief has allowed this relief for small farms to lapse six times. Today we are going to make it permanent. Today we are providing an answer. Today it is a change. I am proud of what we are doing. Our great chairman, the gentleman from Wisconsin (Mr. Sensenbrenner), has not only worked diligently on behalf of farmers but also on behalf of consumers of this country. I think we will pass this bill. I think it is the right thing, and I welcome the opportunity to join the chairman down at the White House when our great President signs this legislation into law.
Mr. Speaker, I yield back the balance of my time, and I move the previous question on the resolution.
The previous question was ordered.
The resolution was agreed to.
A motion to reconsider was laid on the table.
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