Credit Card Minimum Payment Notification Act of 2008

I have sought recognition to introduce two bills with a view to aiding an emergency economic stimulus package. I am pleased to see that the President and the Democratic leaders of the House of Representatives and the Senate have stated their intentions to work together to provide an economic stimulus package. There is no doubt, based upon what is happening in markets around the world, that there is an urgent need for such a package.

It has been well known that the American people have not looked kindly on what is happening in Washington, DC. The approval ratings of the President are low. The approval ratings of the Congress are low. It appears sometimes as if it is a race to the bottom as to who is going to be the lowest the fastest.

But now I think we have an opportunity, in the face of an emergency-- what may accurately be described as a real crisis--to take some effective action. It is my hope we will move with dispatch, with all due deliberation. We have the finest economic minds at work on the issue. There have been a lot of studies, and with our background of knowledge we are in a position to move.

There is no doubt the Congress can move promptly when the Congress has the will to do so with the President. Congress and the President have the capacity to move promptly. It is only a question of the will. I think this is an opportunity for the Federal Government to redeem itself in the eyes of the American people by acting.

I am pleased to see that Federal Reserve Chairman Bernanke has acted this morning to drop interest rates by three-quarters of a percentage point to 3.5 percent. The Chairman of the Fed does not quite go so far as to say we are in a recession, but he has pretty dire news saying:

The committee took this action in view of a weakening of

the economic outlook and increasing downside risks to growth.

While strains in short-term funding markets have eased

somewhat, broader financial market conditions have continued

to deteriorate and credit has tightened further for some

businesses and households.

I think it is really an understatement. I think the credit market is a shambles, that if you look at the indicators in terms of borrowing on a variety of sources, credit is simply not there.

Many had urged the Fed to lower the rate to 3 percent. Candidly, that would have been my choice. But I think three-quarters of a percent is decisive action, and that should be the starting point for an economic package from Congress.

I appreciate the fact that the President has honored the wishes of the leaders of the Democrats in Congress to await specifics until there has been a meeting and a rejoinder of action. But I think the time has come now to be specific.

The two legislative proposals which I am suggesting today deal with depreciation schedules. Currently, there are depreciation schedules on the 3-, 5-, and 7-year mark which my legislation would expense--or, that is, depreciate--in the year when the expenditure is made. Calculating the cost of this legislation over a 10-year period, the Joint Committee on Taxation should find that it will not cost a great deal on the books.

The second bill which I am introducing would give a bonus depreciation

of 50 percent on items purchased on all depreciation schedules. The bonus of 50 percent in 2008 or 50 percent in 2009, if the purchases are made in either of these 2 years, will be a considerable stimulus.

These are not original ideas of mine; these ideas have been proposed from a variety of sources, including a commentary article from The Wall Street Journal dated January 12, 2008. The ideas were forwarded last week to the Secretary of Treasury, Secretary Paulson, and the Chairman of the Council of Economic Advisers, Edward Lazear.

It is my hope we will move promptly with an economic stimulus package. It is my hope that while there may be divergent views and many different points of view, that the efforts are being focused to the maximum extent possible on progrowth ideas.

There is no doubt we have a very serious problem with credit today. What the Federal Reserve has done in lowering the rate three-quarters of a percent to 3.5 percent is a significant start, but more needs to be done on seeing to it that credit is available in our economy.

Mr. President, I have sought recognition to introduce two pieces of legislation designed to provide immediate economic stimulus for an economy hindered by a housing crisis, rising oil prices, unemployment, sagging stock markets, and battered consumer confidence. Both bills I am introducing today, S. 2539 and S. 2540, provide incentives for firms to place new equipment and other assets into use, thus creating new job opportunities. Specifically, my proposals allow firms to deduct, or expense, a greater share of new equipment in the year placed in service. The need for aggressive action is becoming more apparent with each passing day.

There is increasing sentiment that timely action is needed by Congress to stimulate growth beyond what the Federal Reserve can achieve through lower interest rates. Many experts, including former Federal Reserve chairman Alan Greenspan and former Treasury Secretary Lawrence H. Summers, have indicated that the U.S. economy is not faring well and that a recession may be in our future.

Meanwhile, Federal Reserve Chairman Ben Bernanke has been hesitant to classify the deteriorating economy as being in recession. However, in response to an international stock sell-off and the likelihood of a sharp drop in America, the Federal Reserve cut its benchmark short-term interest rate by \3/4\ of a percentage point to 3.5 percent this morning, Tuesday January 22, 2007. In a statement, the Federal Reserve said: ``The committee took this action in view of a weakening of the economic outlook and increasing downside risks to growth. While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households.''

Our current economic difficulties were accentuated with the subprime mortgage crisis. With interest rates at all-time lows, lenders increasingly offered mortgages to those who previously either would not have qualified for a mortgage or could not have afforded the payments on a mortgage. Many borrowers with adjustable rate, interest-only or no-down-payment mortgages have been unable to keep up with their monthly mortgage payments that have reset to higher rates. The implications of the subprime mortgage crisis have now spread beyond the housing sector.

A mere 18,000 jobs were added in December, falling significantly short from the 70,000 that were projected by industry analysts. According to the Labor Department's monthly report, the unemployment rate also jumped to 5 percent, up from November's 4.7 percent. Our economy has not seen that level of unemployment in 2 years. On January 2, 2007, crude oil prices hit the $100 per barrel milestone for the first time. The high cost of energy continues to drive up the cost of doing business. This also means a higher cost of living for American consumers. The Consumer Price Index increased 0.8 percent in November, its largest advance since September 2005. A weak holiday shopping season also suggests that consumer confidence is low. According to the International Council of Shopping Centers, sales growth for retailers was the lowest in 7 years.

On Friday, January 18, 2008, the President made clear that timely action is needed during a televised address with his economic advisors. The President outlined a broad framework for an economic stimulus package, one that: is big enough to make a difference; is built on broad-based tax relief; is temporary and takes effect right away; and does not include any tax increases. Specifically, the President called for Congress to enact temporary tax relief consisting of rebate checks for individuals and investment incentives for businesses. He has tasked Treasury Secretary Henry Paulson and Ed Lazear, Chairman of the Council on Economic Advisors, to work with Congress on agreeing on details of a package.

Many in Congress are floating ideas for a package to kick-start the economy, including boosting spending for extending unemployment benefits and providing States with fiscal relief. No matter what the final product, it is my belief that any package passed into law should include tax incentives to spur immediate business investment. The two bills I introduce today are designed to help firms acquire new capital and expand their operations. Incentives for investment will lead to job creation and help dampen the threat of a recession. In the long-term, investment incentives will lead to increased growth. On January 16, 2008, I wrote to Edward Lazear, Chairman of the President's Council of Economic Advisors, urging him to consider these proposals as cornerstones of any economic stimulus package. I sent a similar letter to Treasury Secretary Hank Paulson on January 18, 2008.

My first piece of legislation provides 2 years of ``bonus depreciation'' for all sectors of the economy. Specifically, firms would be allowed to expense 50 percent of the cost of new equipment in the first year the asset is put to use. Remaining value would be deducted over the course of its useful life by using the Internal Revenue Code depreciation schedules. By allowing firms to expense a greater share of the value of an asset in the first year, this proposal frees up additional resources for firms to hire more workers and expand their operations.

In the long-run, the cost of this proposal is minimal because it simply accelerates a tax benefit that is due over time. This proposal does not create a new deduction. However, because this proposal will affect assets depreciated on schedules longer than 10 years, this bill will have a static revenue cost over a 10-year scoring period.

The second piece of legislation I offer today will allow a variety of sectors to take advantage of one-hundred percent up-front expensing for new assets that are placed into service during tax years 2008 and 2009. Specifically, this legislation would allow all equipment which is currently depreciated on the 3-, 5-, and 7-year schedules to be fully expensed in year one. Under current law, when a company buys an asset that will last longer than 1 year, the company cannot, under most circumstances, deduct the entire cost and enjoy an immediate tax benefit. Instead, the company must depreciate the cost over the useful life of the asset, taking a tax deduction for a part of the cost each year. While the company will get to deduct the full cost of the asset, delaying this benefit is a disadvantage to the company. By allowing firms to deduct the cost of a new asset in year one, expensing spurs new investments quickly, which helps to drive immediate job creation.

The assets that currently depreciate on these schedules are so varied that virtually every sector of the economy would be able to take advantage of this benefit and expand their businesses. Some of the assets and sectors on these schedules include office equipment, transportation equipment, agriculture, textiles, furniture manufacturing, steel products and high-tech manufacturing. I have included at the conclusion of this statement a full list of the asset classes impacted by this bill.

One particular advantage to this legislation is the minimal cost impact as viewed by the Joint Committee on Taxation, the Congressional unit which investigates the operation and effects of internal revenue taxes and the administration of such taxes. Because revenue legislation is scored over a 10-year

window and the tax benefit inferred by this bill still occurs within that span, quicker, it is my belief that the revenue impact will be negligible. This point is of particular importance in the 110th Congress because of PAYGO scoring rules that require offsetting revenue raising provisions to be included in order to ``pay for'' tax relief.

A January 12, 2008, op-ed in the Wall Street Journal entitled ``The JFK Stimulus Plan,'' by Ernest S. Christian and Gary A. Robbins, provides an excellent argument for the approach I have identified with these two bills. According to Mr. Christian and Mr. Robbins, ``More investment means more productivity--and 80 percent of the net benefit from increased productivity goes to labor. Expensing is a no-risk tax cut. It worked four times in the 1960s and 1970s. It worked in 1981- 1982 and again in 2002-2004.'' They cite a 2001 analysis conducted by the Institute for Policy Innovation: ``Each $1 of tax cut from first- year expensing produces about $9 of additional GDP growth.'' A copy of the op-ed is included for the Record.

To address a short-run need for economic stimulus, I urge my colleagues to support this legislation as Congress begins making important decisions on how best to address our slumping economy. These bills are supported by the U.S. Chamber of Commerce, the National Association of Manufacturers, Americans for Tax Reform, and the National Restaurant Association.

In the long run, it is my belief that Congress should consider taking steps to both enhance and make expensing tax benefits permanent. There are strong arguments for allowing all businesses to deduct these costs fully in the year paid instead of requiring them to collect a benefit over a long amount of time. In addition to the issue of providing tax incentives for businesses to invest in new growth capital, I believe it will also be important in the long-run to provide sustained relief for American taxpayers. The President has acknowledged that while passing a new growth package is our most pressing economic priority, Congress needs to turn next to making sure that tax relief that is now in place is not taken away.

I look forward to working with my colleagues to rapidly enact a bipartisan fiscal stimulus package to help our sluggish economy.

Mr. President I ask unanimous consent that the text of the bills of supporting material be printed in the Record.

Mr. President, I rise to introduce the Credit Card Minimum Payment Notification Act.

Many Americans now own multiple credit cards. The average American has four credit cards, and 1 in 7 Americans hold more than 10 cards.

The proliferation of credit cards can be traced, in part, to a dramatic increase in credit card solicitation. In 1990, credit card companies sent about 1.1 billion solicitations to American homes; in 2006, they sent over 9.2 billion.

As one would expect, the increase in credit card ownership has also yielded an increase in credit card debt. Individuals get 6, 7, or 8 different credit cards, pay only the minimum payment required, and many end up drowning in debt. That happens in case after case.

Over the past two decades, the credit card debt of American consumers has nearly tripled--from $238 billion in 1989 to a staggering $800 billion in 2005.

As a result, the average American household now has about $9,500 of credit card debt. That is almost twice the average level of credit card debt from just 10 years ago.

In light of these figures it should be no surprise that vast numbers of Americans have been filing for bankruptcy in recent years. In 2005-- just before the implementation date of the Bankruptcy Reform Act--over 2 million non-business bankruptcies were filed.

Many of these personal bankruptcies are people who utilize credit cards. The benefits and flexibility these cards offer are enormously attractive. However, these individual credit card holders receive no information on the impact of carrying a balance with compounding interest. Too often individuals make just the minimum payment. They pay it for 1 year, 2 years--they make additional purchases, they get another card, and another, and another.

After, 2 or 3 years, many find that the interest on the debt is larger than the total purchases they originally made, such that they can never repay these cards--and they do not know what to do about it.

The Credit Card Minimum Payment Notification Act would help prevent this problem. Let me tell you exactly what the bill would do. It would require credit card companies to add two items to each consumer's monthly credit card statement: a notice warning credit card holders that making only the minimum payment each month will increase the interest they

pay and the amount of time it takes to repay their debt; and examples of the amount of time and money required to repay a credit card debt if only minimum payments are made.

If the consumer makes only minimum payments for, 6 consecutive months, the amount of time and money required to repay the individual's specific credit card debt, under the terms of their credit card agreement.

The bill would also require that a toll-free number be included on statements, to allow consumers to call and speak to a live person to get an estimate of the time and money required to repay their balance if only minimum payments are made.

If the consumer makes only minimum payments for 6 consecutive months, they will receive a toll-free number for an accredited credit counseling service.

The disclosure requirements in this bill would only apply if the consumer has a minimum payment that is less than 10 percent of the debt on the credit card. Otherwise, none of these disclosures would be required on their statement.

Statistics vary about the number of individuals who make only the minimum payments. One study in 2004 determined that 35 million people pay only the minimum on their credit cards. In a 2005 poll, 40 percent of respondents said that they pay the minimum or slightly more.

What is certain is that many Americans pay only the minimum, and that paying only the minimum has harsh financial consequences.

I suspect that most people would be surprised to know how much interest can pile up when paying the minimum. Take the average household, with $9,500 of credit card debt, and the average credit card interest rate, which last week was 13.74 percent. If only the 2 percent minimum payment is made, it will take them 35 years and $21,799.07 to pay off the card.

That is if the family doesn't spend another cent on their credit cards--an unlikely assumption. In other words, the family will need to pay over $12,000 in interest to repay just $9,500 of principal.

For individuals or families with more than average debt, the pitfalls are even greater. $20,000 of credit card debt at the average 13.74 percent interest rate will take 42 years and more than $46,300 to pay off if only the minimum payments are made.

Mr. President, 13.74 percent is only the average rate. Interest rates around 20 percent are not uncommon. Penalty interest rates on credit cards average 27.3 percent, and seven major credit cards charge penalty rates of more than 30 percent.

Even if we assume only a 20 percent interest rate, a family that has the average debt of $9,500 at a 20 percent interest rate and makes the minimum payments will need an incredible 82 years and $55,084 to pay off that initial $9,500 of debt. That's $45,584 in interest payments-- an amount that approaches 5 times the original debt. These examples are far from extreme.

Last March, the Permanent Subcommittee on Investigations of the Committee on Homeland Security and Governmental Affairs heard testimony from Wesley Wannemacher, a consumer from Lima, OH.

Mr. Wannemacher charged $3,200 to a credit card in 2001 and 2002. He never charged anything on the card again, but he spent the next 6 years struggling to pay it off, as he experienced the kinds of events that American households routinely face--unexpected medical expenses, a growing family, and so on.

By early 2007 Mr. Wannemacher had paid $6,300 on the initial $3,200 in debt, but he still owed $4,400 on the card. Interest charges, late fees, and $1,500 in fees for going over the limit--even though the balance had only exceeded the limit three times--had resulted in total charges of $10,700 for that initial $3,200 in credit.

Fortunately for Mr. Wannemacher, his credit card company reviewed his account--after it became known that he was going to testify to Congress about his experience. The remaining balance on his account was forgiven.

Mr. President, testifying before a Senate committee is not something that Americans could--or should have to--do to escape from crushing credit card debt.

That is one of the reasons why it is so important for this Congress to pass the Credit Card Minimum Payment Notification Act.

There will always be people who cannot afford to pay more than their minimum payments. But there is also a large number of consumers who can afford to pay more but feel comfortable paying the minimum payment because they don't realize the consequences of doing so.

Now I am certainly not trying to demonize credit cards or the credit card industry. Credit cards are an important part of everyday life, and they help the economy operate more smoothly by giving consumers and merchants a reliable, convenient way to exchange funds.

However, I do think that people should understand the dangers of paying only their monthly minimums. In this way individuals will be able to act responsibly.

The bottom line is that for many consumers, the two percent minimum payment is a financial trap.

The Credit Card Minimum Payment Notification Act is designed to ensure that people are not caught in this trap through lack of information. The bill tracks the language of an amendment I cosponsored during the debate on the 2005 bankruptcy bill.

The language of this bill is based on a California law, the California Credit Card Payment Warning Act, passed in 2001. Unfortunately, in 2002, this California law was struck down in U.S. District Court as being preempted by the 1968 Truth in Lending Act.

The Truth in Lending Act was enacted in part because Congress found that, ``The informed use of credit results from an awareness of the cost thereof by consumers.''

This bill would amend the Truth in Lending Act, and would also further its core purpose.

These disclosures will allow consumers to know exactly what it means for them to carry a balance and only make minimum payments, so they can make informed decisions on credit card use and repayment.

The disclosure required by this bill is straightforward--how much it will cost to pay off the debt if only minimum payments are made, and how long it will take to do it. As for expense, my staff tells me that on the Web site Cardweb.com, there is a free interest calculator that does these calculations in under a second. Moreover, I am told that banks make these calculations internally to determine credit risk. The expense of making these disclosures would be minimal.

Percentage rates and balances are constantly changing, and each month, the credit card companies are able to assess the minimum payment, late fees, over-the-limit fees and finance charges for millions of accounts.

If the credit card companies can put in their bills what the minimum monthly payment is, they can certainly figure out how to disclose to their customers how much it might cost them if they stick to that minimum payment.

The credit card industry is the most profitable sector of banking, and in 2006 it made $36.8 billion in profits--an increase of nearly 80 percent from their profits in 2000. I don't think they will have any trouble implementing the requirements of this bill.

I believe that this legislation is extraordinarily important and that it will reduce bankruptcies. In the face of the subprime mortgage crisis, and as we appear to be heading toward a recession, this bill is needed now more than ever.

The harsh effects of the 2005 bankruptcy bill are starting to become apparent. I continue to believe that a bill requiring a limited but meaningful disclosure by credit card companies is a necessary accompaniment. I think you will see consumers acting more cautiously if these disclosures are made, and I believe that will be good for the bankruptcy courts in terms of reducing their caseloads, and also good for American consumers.

The credit card debt problem facing our Nation is significant. I believe that this bill is an important step in providing individuals with the information needed to act responsibly, and it does so with a minimal burden on the industry.

I urge my colleagues to support this legislation.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, I rise to introduce the Credit Card Minimum Payment Notification Act.

Many Americans now own multiple credit cards. The average American has four credit cards, and 1 in 7 Americans hold more than 10 cards.

The proliferation of credit cards can be traced, in part, to a dramatic increase in credit card solicitation. In 1990, credit card companies sent about 1.1 billion solicitations to American homes; in 2006, they sent over 9.2 billion.

As one would expect, the increase in credit card ownership has also yielded an increase in credit card debt. Individuals get 6, 7, or 8 different credit cards, pay only the minimum payment required, and many end up drowning in debt. That happens in case after case.

Over the past two decades, the credit card debt of American consumers has nearly tripled--from $238 billion in 1989 to a staggering $800 billion in 2005.

As a result, the average American household now has about $9,500 of credit card debt. That is almost twice the average level of credit card debt from just 10 years ago.

In light of these figures it should be no surprise that vast numbers of Americans have been filing for bankruptcy in recent years. In 2005-- just before the implementation date of the Bankruptcy Reform Act--over 2 million non-business bankruptcies were filed.

Many of these personal bankruptcies are people who utilize credit cards. The benefits and flexibility these cards offer are enormously attractive. However, these individual credit card holders receive no information on the impact of carrying a balance with compounding interest. Too often individuals make just the minimum payment. They pay it for 1 year, 2 years--they make additional purchases, they get another card, and another, and another.

After, 2 or 3 years, many find that the interest on the debt is larger than the total purchases they originally made, such that they can never repay these cards--and they do not know what to do about it.

The Credit Card Minimum Payment Notification Act would help prevent this problem. Let me tell you exactly what the bill would do. It would require credit card companies to add two items to each consumer's monthly credit card statement: a notice warning credit card holders that making only the minimum payment each month will increase the interest they

pay and the amount of time it takes to repay their debt; and examples of the amount of time and money required to repay a credit card debt if only minimum payments are made.

If the consumer makes only minimum payments for, 6 consecutive months, the amount of time and money required to repay the individual's specific credit card debt, under the terms of their credit card agreement.

The bill would also require that a toll-free number be included on statements, to allow consumers to call and speak to a live person to get an estimate of the time and money required to repay their balance if only minimum payments are made.

If the consumer makes only minimum payments for 6 consecutive months, they will receive a toll-free number for an accredited credit counseling service.

The disclosure requirements in this bill would only apply if the consumer has a minimum payment that is less than 10 percent of the debt on the credit card. Otherwise, none of these disclosures would be required on their statement.

Statistics vary about the number of individuals who make only the minimum payments. One study in 2004 determined that 35 million people pay only the minimum on their credit cards. In a 2005 poll, 40 percent of respondents said that they pay the minimum or slightly more.

What is certain is that many Americans pay only the minimum, and that paying only the minimum has harsh financial consequences.

I suspect that most people would be surprised to know how much interest can pile up when paying the minimum. Take the average household, with $9,500 of credit card debt, and the average credit card interest rate, which last week was 13.74 percent. If only the 2 percent minimum payment is made, it will take them 35 years and $21,799.07 to pay off the card.

That is if the family doesn't spend another cent on their credit cards--an unlikely assumption. In other words, the family will need to pay over $12,000 in interest to repay just $9,500 of principal.

For individuals or families with more than average debt, the pitfalls are even greater. $20,000 of credit card debt at the average 13.74 percent interest rate will take 42 years and more than $46,300 to pay off if only the minimum payments are made.

Mr. President, 13.74 percent is only the average rate. Interest rates around 20 percent are not uncommon. Penalty interest rates on credit cards average 27.3 percent, and seven major credit cards charge penalty rates of more than 30 percent.

Even if we assume only a 20 percent interest rate, a family that has the average debt of $9,500 at a 20 percent interest rate and makes the minimum payments will need an incredible 82 years and $55,084 to pay off that initial $9,500 of debt. That's $45,584 in interest payments-- an amount that approaches 5 times the original debt. These examples are far from extreme.

Last March, the Permanent Subcommittee on Investigations of the Committee on Homeland Security and Governmental Affairs heard testimony from Wesley Wannemacher, a consumer from Lima, OH.

Mr. Wannemacher charged $3,200 to a credit card in 2001 and 2002. He never charged anything on the card again, but he spent the next 6 years struggling to pay it off, as he experienced the kinds of events that American households routinely face--unexpected medical expenses, a growing family, and so on.

By early 2007 Mr. Wannemacher had paid $6,300 on the initial $3,200 in debt, but he still owed $4,400 on the card. Interest charges, late fees, and $1,500 in fees for going over the limit--even though the balance had only exceeded the limit three times--had resulted in total charges of $10,700 for that initial $3,200 in credit.

Fortunately for Mr. Wannemacher, his credit card company reviewed his account--after it became known that he was going to testify to Congress about his experience. The remaining balance on his account was forgiven.

Mr. President, testifying before a Senate committee is not something that Americans could--or should have to--do to escape from crushing credit card debt.

That is one of the reasons why it is so important for this Congress to pass the Credit Card Minimum Payment Notification Act.

There will always be people who cannot afford to pay more than their minimum payments. But there is also a large number of consumers who can afford to pay more but feel comfortable paying the minimum payment because they don't realize the consequences of doing so.

Now I am certainly not trying to demonize credit cards or the credit card industry. Credit cards are an important part of everyday life, and they help the economy operate more smoothly by giving consumers and merchants a reliable, convenient way to exchange funds.

However, I do think that people should understand the dangers of paying only their monthly minimums. In this way individuals will be able to act responsibly.

The bottom line is that for many consumers, the two percent minimum payment is a financial trap.

The Credit Card Minimum Payment Notification Act is designed to ensure that people are not caught in this trap through lack of information. The bill tracks the language of an amendment I cosponsored during the debate on the 2005 bankruptcy bill.

The language of this bill is based on a California law, the California Credit Card Payment Warning Act, passed in 2001. Unfortunately, in 2002, this California law was struck down in U.S. District Court as being preempted by the 1968 Truth in Lending Act.

The Truth in Lending Act was enacted in part because Congress found that, ``The informed use of credit results from an awareness of the cost thereof by consumers.''

This bill would amend the Truth in Lending Act, and would also further its core purpose.

These disclosures will allow consumers to know exactly what it means for them to carry a balance and only make minimum payments, so they can make informed decisions on credit card use and repayment.

The disclosure required by this bill is straightforward--how much it will cost to pay off the debt if only minimum payments are made, and how long it will take to do it. As for expense, my staff tells me that on the Web site Cardweb.com, there is a free interest calculator that does these calculations in under a second. Moreover, I am told that banks make these calculations internally to determine credit risk. The expense of making these disclosures would be minimal.

Percentage rates and balances are constantly changing, and each month, the credit card companies are able to assess the minimum payment, late fees, over-the-limit fees and finance charges for millions of accounts.

If the credit card companies can put in their bills what the minimum monthly payment is, they can certainly figure out how to disclose to their customers how much it might cost them if they stick to that minimum payment.

The credit card industry is the most profitable sector of banking, and in 2006 it made $36.8 billion in profits--an increase of nearly 80 percent from their profits in 2000. I don't think they will have any trouble implementing the requirements of this bill.

I believe that this legislation is extraordinarily important and that it will reduce bankruptcies. In the face of the subprime mortgage crisis, and as we appear to be heading toward a recession, this bill is needed now more than ever.

The harsh effects of the 2005 bankruptcy bill are starting to become apparent. I continue to believe that a bill requiring a limited but meaningful disclosure by credit card companies is a necessary accompaniment. I think you will see consumers acting more cautiously if these disclosures are made, and I believe that will be good for the bankruptcy courts in terms of reducing their caseloads, and also good for American consumers.

The credit card debt problem facing our Nation is significant. I believe that this bill is an important step in providing individuals with the information needed to act responsibly, and it does so with a minimal burden on the industry.

I urge my colleagues to support this legislation.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, it is clear that our economy is going from bad to worse. Every day the headlines bring more bad news. Fuel prices are going through the roof. Millions of families are at risk of losing their homes. Bankruptcies have risen by 40 percent in the last year alone.

Most alarming, we are seeing a drastic rise in the number of Americans out of work. In December, half a million more Americans were unemployed than the month before. Today nearly 8 million Americans are looking for a job and can't find one. The national unemployment rate has shot up to 5 percent--the biggest increase since the last recession. Experts say this number will rise well above 6 percent in 2009. Vulnerable parts of our population have been hit even harder-- last month, 9 percent of African-American workers were unemployed, up sharply from 8.4 percent in November. Latino workers now have an unemployment rate of 6 percent.

What's more, we are seeing a large number of out-of-work Americans who still can't find a new job months later. Nearly one out of five Americans who is looking for work has been out of a job for over 6 months--compared with roughly one out of ten in 2001, before the last recession. With only 4 million job openings and nearly 8 million unemployed Americans, there are two workers for every job. As unemployment rises, there will be even more workers competing for each job. As highlighted in yesterday's front-page article in the Washington Post, this problem is affecting workers across our economy--even those with college educations and years of experience can't find work.

These aren't just statistics. These numbers are coworkers, our relatives, our neighbors. For each and every one of those families, a pink slip can spell economic disaster.

Losing a job isn't just losing a paycheck--it can mean losing the results of years of hard work and sacrifice.

For too many families, losing a job means losing health insurance. Without insurance, an unexpected hospital stay--from a broken leg or a cancer diagnosis--means certain financial disaster. Mr. President, 77 percent of middle class Americans do not have enough assets to pay essential expenses for 3 months. Without a paycheck, the rising price of daily necessities--housing, gasoline, and even groceries--becomes impossible to afford.

Our unemployment insurance program is intended to help workers weather a job loss. Workers pay into the program throughout their careers. If they lose their jobs, they can collect a benefit while they look for work. The amounts are modest--typically less than half of a worker's regular wages--but they help families to pay their rent, keep the house warm, and put food on the table.

In good economic times, such benefits are enough to tide workers and their families over for the few weeks it takes to find a job. But these are not good times. It is taking longer and longer for unemployed Americans to find new work. Over 1.3 million Americans have been looking for a job for 6 months or more. As a result, an increasing number of workers have not found a new job by the time their unemployment benefits run out. Over the past year, over 2.6 million Americans--or 35 percent of all unemployed workers--have exhausted their unemployment benefits. Unless we respond soon, these and other families will be left in the cold.

So we must act, and we must act now, to help these workers before financial disaster strikes. That is why I am introducing legislation today to give workers the help they need and have earned. The Emergency Unemployment Compensation Extension Act will ensure that Americans who keep looking for work but can't find a job after 6 months will be eligible for up to 20 weeks of additional benefits. In very high- unemployment States, workers could also receive up to 13 more weeks of benefits. Because out-of-work families are facing skyrocketing costs of gas, home heating, food, and housing, long-term unemployed workers will temporarily receive $50 extra each week to help pay their bills.

Providing this extension is a matter of fairness. We owe it to all workers who have lost their jobs in this struggling economy to provide help while they look for new jobs. Out-of-work Americans have worked hard all their lives. They have paid into the unemployment insurance system with the promise they would receive its protection when our economy is in crisis. Part of the American Dream is the opportunity to work hard, provide for your family, put your children through school, and save for retirement. When the economy isn't working the way it should and the jobs simply aren't there, we must stick together. We must take care of those who can't find a job.

But there's another major reason to act. Economists agree that extending unemployment benefits is a powerful, cost-effective way to deliver a boost to the economy. The extension of benefits puts money into the hands of those who need assistance the most and are most likely to spend it immediately on basic essentials. This means money is flowing immediately to local businesses, which will in turn provide a further economic boost.

Indeed, according to a report by Mark Zandi of Moody's, each dollar invested in benefits to out-of-work Americans leads to a $1.73 increase in growth--the most of any measure tested. That compares with only pennies on the dollar for cuts in income tax rates or cuts in taxes on investments.

The Congressional Budget Office agrees. Its report last week on short-term economic stimulus found that extending unemployment benefits is among the most cost-effective, potent, temporary steps that Congress can take to jump-start our economy.

This is a tried and true approach to helping working families in economic downturns. In each recession since the late 1950s, Congress has extended unemployment benefits to those who have exhausted their benefits and can't find work. It has often done so by overwhelming, bipartisan votes. Layoffs don't discriminate by party.

Extending unemployment benefits is the right thing to do for the economy and the fair thing to do for workers. I urge my colleagues to join me in helping out-of-work Americans and putting our economy back on track.

Mr. President, I rise to speak on a bill I filed today, the Combat Veterans Debt Elimination Act of 2008. This bill requires the Secretary of the Department of Veterans Affairs to forgive certain debts by our service members who have already paid the ultimate price in combat. This bill is about honoring our fallen heroes by treating the families they left behind with dignity, and by showing them we truly mean it when we tell them our Nation is grateful.

If a member of our Armed Forces is killed and owes the Department of Veterans Affairs any outstanding debts, the Secretary of VA is required by law to notify the deceased family of the debt. I am appalled at this. I am saddened. If a service member is killed in combat, his or her family has already paid enough. I cannot think of anything more insulting than to tell a family who has just lost a loved one that they owe a couple of hundred dollars to the Government. I for one will not stand for this.

Let me explain the scope of this problem to illustrate how simple it should be to fix. There are 22 service members who were killed in combat fighting in Iraq and Afghanistan who have debts to the VA. If you combined the debts of those 22 service members, the total amount of their debt would come to $56,366. In most cases the service member's debt came in the form of educational benefit payments so they could go to college. During their enrollment at school, they were called into service, and they were killed. Later on, the VA was forced to contact the families of the deceased and notify them of those outstanding debts. How tragic is this?

Three of the 22 cases occurred in my home State of Texas, which is more than any other State. One fallen hero, a brave young man from Raymondville, TX, joined the Army in 1997, right out of high school where he was both an academic star, and an athletic star. He had been accepted to a prestigious university, but put service to his country first. He was on his 3rd tour in Iraq when he was killed by a sniper's bullet. When he died, he owed the Government $389 in education assistance payments. The Secretary of VA was required by law to contact that family and ask for $389. I cannot imagine a more insensitive requirement. The family paid this debt in full because they believed it was the right thing to do. But did we do the right thing? I regret to say we did not. I am embarrassed that this happened and I beseech my colleagues to fix this problem today.

A second case involved an Army Sergeant from Missouri City, TX. After serving in the Marine Corps for a number of years, this young man enlisted in the Army. After high school he attended 2 different colleges utilizing VA education benefits. When he was deployed, he dropped out of school to serve his country. He served one tour in Afghanistan and was on his 2nd tour in Iraq when he was killed by a bomb explosion. Because he had dropped out of school, the deceased owed the VA $2,282. He is survived by a wife and 4 children. The family paid the VA because they also believed it was the right thing to do.

The third Texas case involved a Marine reservist. He graduated from Texas A&M University and intended to be a cardiovascular surgeon. He had received education assistance to go to the University. He was also killed in an explosion in Iraq. He was married and had 2 small children. Two days before his death the VA sent him a letter saying he owed $845.

This is not a bill that should in any way fall into politics. This bill should be passed quickly on a bipartisan basis. There are cases just like the ones I mentioned in Wisconsin, North Carolina, Illinois, Iowa, Connecticut, Nebraska, Colorado, Michigan, Washington, California, New York, Kentucky, Georgia and South Carolina. It is clear our entire Nation is affected and we have to do something now.

I know bills are usually referred to the committee of jurisdiction for review. I have served in this distinguished body for 15 years. But I am convinced this is a special case, and so I am here today asking the distinguished Majority and Minority Leaders to bring this bill to the floor before another family suffers the indignity of the current law. The VA has no choice but to follow the law, but we, here in Congress, have the power to change it. We can and should correct this requirement and honor the memories and the families of our fallen heroes.

I am calling on all of my colleagues to right this wrong immediately. We cannot let this law stand another day. Our soldiers and their families deserve better. Every day is crucial to passing this legislation and I ask my colleagues to join with me in this endeavor.