Credit Card Rate Freeze Act of 2009

Madam President, to my colleague from New York, Senator Bennet and I are here on a different matter. If the Senator will be brief, I am happy to wait until he finishes.

Madam President, I know my colleague from Colorado, Senator Bennet, wants to speak to this issue as well. He has been a champion, along with me and several others, to try to bring justice to an issue that is incredibly important.

It is no secret that decades of indifference and discrimination in lending practices at the U.S. Department of Agriculture have made it difficult for minority farmers--specifically Hispanic farmers--to make a living at what they love to do and have done, in many cases, for generations, leaving many no choice but to leave the farms and ranches they have tended to all of their lives.

In the year 2000, 110 Hispanic farmers brought a lawsuit against the U.S. Department of Agriculture for the same egregious discriminatory practices that resulted in a historic settlement with African-American farmers. For 8 long years, under the last administration, thousands of Hispanic farmers who joined the suit waited and waited and waited for justice. Some of them died waiting and will never be made whole. For 8 long years, the Bush administration did nothing.

These hard-working farmers, Hispanic families, who bought a piece of land and built a family farm--their small piece of the American dream-- were wrongly denied loans and other benefits in violation of the Equal Credit Opportunity Act by county committees that review Farm Service Administration credit and loan applications for approval. Consequently, these farmers filed suit in the hope that it would change the discriminatory practices at the USDA, how it treated America's minority farmers; but under the Bush administration, nothing changed, the discrimination continued.

Then something did change. We got a new President and a new Secretary of Agriculture, who described past practices at the U.S. Department of Agriculture as ``a conspiracy to force minority and socially disadvantaged farmers off of their land.'' Consequently, the administration committed to appropriate $1.25 billion in the fiscal 2010 budget to settle some of the outstanding discrimination lawsuits but not all of them. To date, Hispanic farmers, women, and Native Americans have not yet seen a settlement.

We need to remedy this situation once and for all. The new U.S. Department of Agriculture Secretary needs to make these farmers whole. Secretary Vilsak has created a task force to review the park and civil rights complaints and announce new efforts for the U.S. Department of Agriculture to end any and all discriminatory practices, and I commend the secretary for addressing this lingering issue. But more needs to be done.

As I said, along with seven of my colleagues, in a letter to the President, quoting from that letter, we said:

The U.S. Department of Agriculture's corrective role in

this instance has been clearly laid out, and there remains no

legitimate reason to delay action for any of the affected

groups.

The fact is that 8 years after a do-nothing Republican administration that earned the U.S. Department of Agriculture the designation of ``the last plantation,'' putting people's lives and livelihoods at risk, we simply cannot wait any longer. Certainly, for example, Alfonso and Vera Chavez cannot wait any longer. The Fresno Bee reported last week that Mr. and Mrs. Chavez stopped farming 7 years ago when they could not get a USDA loan. In fact, they said they not only could not get the loan but they were discouraged from applying and, even worse, they believed they were given misinformation so they would not apply. To quote Vera Chavez, who told the reporter, ``It was like they didn't want us to have the money.''

Mr. and Mrs. Chavez owned 300 acres. They sold off 200 of those acres, shut down their packing house, and leased the remaining hundred acres to survive. Vera said, ``It is why we have been hanging onto those 100 acres, so my children and grandchildren can have a little piece of land we worked so hard to get. I am not going to give up. But we have written so many letters, had so many meetings, and nothing seems to be moving forward.''

We need to move this forward. It is about fairness, about doing what is right. When we see discrimination in any form, and when those who have been wronged because of their race, gender, or heritage are forced to sell what they have worked a lifetime to build--abandoned by the last administration that cared more about Wall Street than Main Street--we have to make things right for them, for people like Vera and Alfonso Chavez. We need to make sure that they can keep their farms and give them back their lives. All these farmers are asking for is a commonsense solution sooner rather than later, because they have waited long enough.

I received a letter that is addressed to the President. It is a letter from the named plaintiff in the landmark case Pigford v. Glickman. That was a case that brought together African-American farmers in that landmark decision, who were also discriminated against. The letter to the President by Mr. Pigford says, referring to Hispanic, Native-American, and women farmers:

They have suffered the same discrimination by the United

States Department of Agriculture as African American farmers.

Just as USDA addressed the claims of African Americans on a

classwide basis, it should similarly settle the

discrimination claims of Hispanic and other minority farmers

on a classwide basis.

. . . Furthermore, it makes no sense for four minority

groups to suffer the identical discrimination from the same

federal agency and yet only one of those four groups to be

compensated on a classwide basis.

It goes on to say:

Mr. President, fundamental fairness and simple practice

demand that you close the entire book on all discrimination

at USDA and, consistent with section 14011, ``resolve all

pending claims and class actions in an expeditious and just

manner.''

I ask unanimous consent to have printed in the Record Mr. Pigford's letter to the President.

We urge Secretary Vilsak to ensure all farmers will be granted the same consideration so they can begin to rebuild their lives and their farms this year. Despite clear language in section 14011 of the Food Conservation and Energy Act of 2008, which urges the administration to settle lawsuits brought by Hispanic and other farmers, the administration clearly needs to assure Hispanic farmers, many who have come to me, Senator Bennet, and others to ask for help, that it fully intends to address these cases consistent with section 14011 of the 2008 farm bill.

We simply cannot continue down this winding road to nowhere. To ignore the plight of the thousands of Hispanic farmers, families who seek nothing more than justice, who want only a chance to keep the farms and ranches they worked so hard for all of their lives, is wrong.

For 8 years, thousands of families like the Chavezes were ignored. Now we need to change that. We need to move quickly to resolve what is clearly and patently unfair and unjust. You will never turn the page on the past discriminatory practices within USDA until all victims--every last one of them--are made whole for the loss of their land, their dignity, and their hope for a decent life for themselves and their families. Let us move quickly to give them the chance they have waited for, the chance to rebuild their lives.

With that, I yield the floor.

Madam President, I wish to make some brief comments. I will yield to my colleague from Colorado, Senator Udall, in a moment, and then at the conclusion of his comments I will propound a unanimous consent request. I will not do that until I know there is an objection that will be rendered, and I would certainly wait until I know that is coming. I will not, obviously, make the request until that person arrives so they can express their objection. Regretfully, I might add, they are going to express that objection, but, nonetheless, I don't want them to be worried that I would somehow try to sneak this in, knowing there is an objection to be filed.

I rise this afternoon in support of legislation that would do something that I think most Americans would support as well, regardless of where you live and what your economic circumstances may be; that is, to freeze interest rates on existing credit card balances until the full protections of the Credit Card Accountability Act we wrote earlier this year go into effect. As many of my colleagues will recall, on a vote of 90 to 5, we passed a bill early this year by a near unanimous vote because we all heard the same stories from our constituents across the country: Credit card companies charging outrageous fees; consumers finding out that the interest rates had been jacked up for no apparent reason whatsoever; families struggling to make ends meet and being driven further and further and further into debt by what I would describe as abusive practices.

On that day, on the day we passed the bill, we declared that credit card companies were unfairly padding profits at the expense of the people we work for, so we put a stop to it. Today, it is no different, unfortunately. Knowing that the Credit Card Act will finally protect consumers from these abuses, the industry has tried to make one last grab for their customers' pocketbooks, and that is what has been going on over these past several months. I think this behavior is deplorable, to put it mildly. We can, once

again, put a stop to it, and that is what I will be proposing shortly.

The legislation I rise to discuss would immediately freeze interest rates on credit cards to ensure that Americans are protected until the full provisions of that law go into effect in February. The holiday season is upon us. Hard-pressed Americans want to go out and do what they can to help their families and to celebrate at a very difficult time. Some joy--and a lot of that will have to occur, obviously, by taking a credit card out to make those purchases during the holiday season, the Thanksgiving break coming up, for putting food on the table, traveling, calling a family member, calling a friend. All those activities, to some degree, given the hardship people are feeling, will require them to use that credit card in too many cases.

To do so, of course, they are watching in this window an industry continuing to skyrocket these rates as well as these fees on people.

Let me tell my colleagues something: The reason we allowed a gap period between the passage of the legislation and the imposition of the regulations or the statutory requirements was because the industry came to me and said: Senator, we are going to need some time to administer-- to change how we provide these kinds of benefits to people, so would you give us a little window here to operate. On the basis of that request, we did so. They wanted longer, but we thought February was fine. If that had been what they had done, I think most of us would say we understand that. Unfortunately, they have taken that window and used it as a way to jam in on the consumers of this country, particularly at a time when, again, people are losing their jobs, their homes, their health care, their retirement, and the holiday season is upon us.

Every 6 months, card companies will be required, under our bill, to review each account they hit with a high rate hike since January of 2009 and reduce the rate if the customer has become less of a credit risk.

As consumers, obviously, we have a responsibility to spend within our means and to pay what we owe. We bear that responsibility. But the credit card industry as well has a responsibility to deal with their customers honorably. There is nothing honorable about what has happened with these significant rate increases and fees. Most importantly, they don't have a right to rip off American families, especially when the Congress has already gone on record opposing the very actions they are engaging in and doing so in a timeframe that was given to them to adjust to the new changes that will occur under the credit card legislation. Instead of fulfilling that obligation, they are using it as a window to grab as much as they can out of the pockets of hard- pressed consumers.

So let us help consumers have a break in all this. I see my colleague from Colorado and I will yield to him for a couple minutes and when he finishes his remarks I will make a unanimous consent request that we proceed to the immediate consideration of Calendar No. 189, the Credit Card Rate Freeze Act; further, that the bill be read a third time and passed, and that a motion to reconsider be laid upon the table with no intervening action or debate. This would provide us a window of about 12 weeks--that is what it amounts to, between now and the 1st of February--during this holiday season to put a stop to these outrageous rates and fees being charged to people.

I hope my colleagues, whether you agreed with the bill--although most did; 90 colleagues voted for the bill in the spring--why wouldn't you join us today in allowing 12 weeks for a freeze on these rates that are occurring to give our fellow citizens across this country a chance to meet these obligations.

With that, I yield to my colleague from Colorado.

Madam President, I thank my colleague for his remarks. Many others have similar views on this. I regret that there is going to be an objection filed to a measure that would have allowed us to do something meaningful for our fellow citizens at this time of the year.

Madam President, I ask unanimous consent that the Senate proceed to the immediate consideration of Calendar No. 189, S. 1927, the Credit Card Rate Freeze Act of 2009; further, that the bill be read the third time and passed, and the motion to reconsider be laid upon the table, with no intervening action or debate.

Madam President, I am very pleased to rise today to join the Senator from New Jersey to discuss the injustices committed against Hispanic farmers over the course of many years. I also thank Senator Menendez, the congressional Hispanic caucus, and my colleagues who have come to the floor to demonstrate their leadership on this issue.

For the reasons Senator Menendez laid out, it is long past time to call attention to this indefensible injustice and to lend our voices to a better way forward. As is well known, for years--decades--minority farmers were systematically discriminated against when they visited local USDA farm service agency offices all across this country. They were denied loans and farm program assistance because of their skin color, ethnicity, or gender. Senator Menendez did a good job describing the case.

I want to give some examples from my State, because in many cases, because of this discrimination, these farmers lost their livelihoods and their way of life. If we choose to let some of them make their case, and deny that chance to others, then we repeat these historic civil rights wrongs all over again.

Among the many letters I have received is a declaration from Mr. Gomez of Alamosa, CO, a former USDA employee who served his country for 30 years. In seven pages of excruciating detail, Mr. Gomez explains how he, as a loan officer, witnessed discrimination in granting of FSA loans. Reasons loans were denied were recorded as ``insufficient experience,'' or other subjective terms. As Mr. Gomez gained more responsibility, he was eventually in a position to review loan applications from around the region he supervised, and he became increasingly aware of a pattern of discrimination.

In another letter, Mr. Sandoval of Antonito, CO, tells of repeatedly being turned away from local loan offices and denied FSA loans on grounds that he did not have the ``character'' necessary. Mr. Sandoval explains how his inability to access credit through the USDA limited his ability to grow his farming operation and become a more successful farmer.

Another Mr. Sandoval of Commerce City, CO, writes:

This has been going on for so long that some farmers have

lost their lives waiting for justice to prevail.

Mr. DeHerrera, also of Antonito, CO, writes:

In desperation, I approached [someone] at the . . . FSA to

request a loan of approximately $80,000 so I could at least

keep the farm from being foreclosed. . . . He told me very

hatefully that they refused to approve either my loan or the

loan of the Sandoval brothers.

He continues:

I am convinced [FSA] refused to approve the Sandoval's loan

because both the buyer and the seller of the farmland to be

purchased were Hispanic American farmers.

Reading through the many letters I have received from Hispanic farmers in Colorado and the meetings I have had all across my State and the letters from people all over the country, a pattern emerges--one of thinly veiled discrimination that starts by discouraging Hispanic farmers from applying for FSA loans in the first place. All too frequently, this discrimination resulted in the loss of a farm and the loss of a way of life.

I have had farmer after farmer say they had to get out of the business of farming, that they could not leave their farms to their children, which is the only dream they have in their life, because of the discrimination they suffered at the hands of our Federal Government.

President Obama's new Agriculture Secretary, Tom Vilsack, has repeatedly, much to his credit, emphasized his commitment to addressing the longstanding civil rights problems that have plagued the Department and to charting a new era. I commend the Secretary's commitment and the dedication the Obama administration has made to chart a new future for the USDA.

Yet that does not fix the wrongs of yesterday. Congress has taken some positive steps, and the administration has created a process for resolving the claims of some minority farmers, even dedicating significant funds toward this end. But a path to justice has not yet been charted for Hispanic farmers.

The best way America can send a message that our government will not discourage minorities from participating in public programs, will not discriminate against them, is proactively to pursue justice.

It is time the administration and Congress come together and do more than just acknowledge past wrong doing at the USDA. It is time to address that wrongdoing.

I will say that my predecessor in this job, Ken Salazar, our great Senator from Colorado, now our Interior Secretary, comes from a part of my State called the San Luis Valley. Ken Salazar's family settled that land long before Colorado was even a State. If you drive down there and visit San Luis, what you will see is an irrigation ditch that was dug before our State was even a State. Among the names of the people, the names of the farmers and the ranchers who were entitled to take water from that ditch because

they had been there, and had been there to dig that ditch, is the name Salazar, the proud name Salazar. It is wrong, after generations of people have committed their lives and their families to agriculture in places such as Colorado and all across the country, that we have discriminated against them for decades and, when that discrimination is discovered because of some legal technicality or because they got the wrong judge, they find themselves unable to redress that discrimination.

I am very pleased to have the chance to be here today with Senator Menendez and other colleagues to call this to the attention of the administration and to say that we need to do more than just acknowledge this problem. It is time for us to help address the problem.

Madam President, I yield the floor.

Madam President, I rise in support of the motion that has been made by the senior Senator from Connecticut, which requests consent for the Credit Card Rate Freeze Act. I wish to associate myself with his remarks. I am a proud original cosponsor of his bill. I wish to urge, as our chairman has, our friends on the other side of the aisle to lift their holds on this important legislation.

Credit card companies have forced unfair and abusive practices on American consumers for too long. I have fought for several years and introduced a number of bills that would put an end to these practices. We passed a law this year that will level the playing field for consumers and put an end to the worst abuses by February of next year.

Let me tell my colleagues what has been happening since then. Credit card companies are using that time before the new law goes into effect to get rate and fee hikes in under the wire. It is happening at the worst time possible, as the chairman pointed out. American families are struggling in a recessionary period. The last thing our families need is higher interest rates and extra fees, especially on consumers who are already playing by the rules.

This has been a classic case of a David versus Goliath situation. I say it is time to take on Goliath and stop credit card companies from gaming the system at the expense of American consumers. This bill Chairman Dodd and I are supporting would provide consumers and small businesses who play by the rules a better foundation to pay off their debts, or to buy groceries and business supplies, and most important, they should get fair treatment from the credit card companies.

This is a critically important bill for economic recovery. It is the right thing to do. I urge my friends on the other side of the aisle to join us and allow it to move forward.

Madam President, today I join my colleagues in bringing this body's attention to an issue of fundamental fairness that continues to remain unaddressed.

More than 10 years ago, Hispanic farmers from my home State of Colorado joined other Hispanic farmers throughout the country to stand up against injustice. They chose to confront--rather than accept-- discrimination when they filed their case against the U.S. Department of Agriculture on grounds that the Farm Service Agency denied loans and disaster benefits in violation of the Equal Credit Opportunity Act and the Administrative Procedure Act.

Earlier this month, I met some of these farmers in Colorado's San Luis Valley. Many of these men and women proudly trace their heritage to some of the first settlers of Colorado who were the first to till the soil of the San Luis Valley and establish Colorado's earliest farming communities, spurring the development of southern Colorado.

Now, I understand that every farmer takes on enormous risk to keep our country fed and prosperous. Yet when these farmers applied for Federal assistance intended to make them whole again--assistance intended to help family farmers stay in business--the record suggests that this aid was denied or delayed, not because their request lacked merit but because of their Hispanic heritage.

I found that shocking. It wasn't any weather event that led these men and women to financial hardship or the loss of their family farm. The obstacles they faced when applying for a loan or disaster assistance were far worse than any drought, flood, hail or windstorm they had ever confronted. It was discrimination based on their heritage that kept them from receiving timely support from an agency whose mission is to support all of America's farmers equally.

Evidence of discriminatory practices in the U.S. Department of Agriculture is an unfortunate and shameful part of our history. On several occasions, I have joined my colleagues in the Senate and in the House to express our desire to bring this disgraceful chapter to a close. During the most recent debate on America's 2008 farm bill, we affirmed that it is the sense of Congress that all pending claims and class actions brought against the Department of Agriculture by socially disadvantaged farmers or ranchers be resolved in an expeditious and just manner.

I would like to acknowledge that Secretary of Agriculture Tom Vilsack has been courageous in this matter, and I am pleased that the administration views this as a priority. I am also pleased that the Secretary has expressed his intent to ensure that no other farmers experience the same discrimination and that he will take definitive action to improve USDA's record on civil rights. I remain ready and willing to work with the administration and my colleagues to support this policy.

I want to emphasize that this is an issue of fundamental fairness. The sooner we can resolve this, the sooner we can look forward to a USDA that serves all Americans equally. It is my hope that these cases be resolved expeditiously and fairly so that the farmers and their families who have suffered the real effects of discrimination can finally put this matter to rest.

Mr. President, I rise today to offer legislation that would freeze interest rates on existing credit card balances until the full protections of the Credit Card Accountability, Responsibility, and Disclosure Act go into effect in February.

It is clear that credit card companies see gouging consumers as a viable means of padding their profits. When they realized that we were serious about ending these abusive practices, they unfortunately decided to make one last grab for the pocketbooks of American consumers before the law goes into effect.

Even before the Credit CARD Act passed, I heard from Connecticut residents who had seen their interest rates double or even triple with little warning and no explanation. As the law's implementation approaches, credit card companies have continued to jack up their customers' interest rates to get ahead of provisions in the Credit CARD Act that will permanently prohibit them from arbitrarily raising rates on existing balances.

To those of us who have worked to rein in credit card abuses, this greedy behavior is disturbing, although not surprising. But to the families in my home state of Connecticut and around the country who are struggling to make ends meet these days it is something worse.

Debt can crush families, driving them into bankruptcy and shattering the financial foundation they have worked so hard to build. It is impossible to get ahead when you're falling further and further behind each month. The anytime, any-reason rate hikes that credit card companies have used to enrich themselves have destroyed too many American families.

That is why we took action to stop unjustified rate hikes, and why it is an outrage that credit card companies are trying to jam consumers one last time before our law stops them.

I am not about to let this stand. In April, Senator Schumer and I wrote to the Federal Reserve, the Office of Thrift Supervision, and the National Credit Union Administration, calling on them to use their existing authority to implement an emergency freeze on interest rates.

The regulators, unfortunately, did not act. Therefore, on behalf of our constituents, we must. This legislation will immediately freeze interest rates to ensure that Americans are protected until the full Credit CARD Act goes into effect.

When it does, a provision I included in the legislation will hold credit card companies accountable for their recent behavior. Every 6 months, card companies will be required to review each account that they hit with a rate hike since January 1, 2009, and reduce the rate if the customer has become less of a credit risk or the circumstances that warranted the increase are no longer present.

I have directed Federal regulators to notify all credit card companies that they will be required to comply with this provision and to draft regulations that provide clear, strict rules to govern the reviews. Customers that did not deserve to have their rates raised in the first place should not have to be stuck with the higher rate after the Credit CARD Act takes effect.

Consumers have a responsibility to spend within their means and to pay what they owe. But credit card companies have a responsibility to deal with their customers honorably. And they most certainly do not have the right to rip off American families, especially when this Congress has already gone on the record opposing those actions.

Struggling middle class families won a huge victory when we passed the Credit CARD Act. Let us help them win another by ensuring that the credit card companies' reign of greed does not continue for even the short time before the law is implemented. I urge my colleagues to join me in this legislation.

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