A joint resolution prohibiting the deployment, establishment, or maintenance of a presence of units and members of the United States Armed Forces on the ground in Libya, and for other purposes.

Madam President, I will yield to the Senator from Rhode Island, and then I will make my statement.

Madam President, well, I want to thank Senator Reed for his comments. Senator Reed is one of the leaders on the Banking Committee. I appreciate his comments.

I do want to set the record straight on a couple of things though. It is not a 12-month delay plus a 6-month study. It is a 6-month study and then implementation of the rules.

The Senator said Chairman Bernanke had plenty of information. The problem is he does not have much information from community banks and credit unions, and that is what this amendment is about.

The exemption that is in the amendment that we passed last year, called the Durbin amendment, every regulator at the Federal and State level has said they cannot make the exemption work because market forces will determine where the customers flow.

I am glad we are here to vote on the amendment that Senator Corker and Senator Hagan, Senator Crapo, Senator Bennet, and I have worked so hard on. This afternoon we are finally going to have an opportunity to vote for an amendment that has been crafted in the right way.

Senators Hagan and Crapo and Bennet came to Senator Corker and I about a month ago to share their interests in fixing the unintended consequences of that amendment that was passed in the Senate about a year ago. The amendment directed the Federal Reserve to issue regulations limiting the cost that banks can charge retailers when consumers use their debit cards to buy things. Based on the law, the Fed intends to limit those costs to 12 cents, even though the actual costs of these transactions may be higher.

The big Wall Street banks can handle that. They are not happy about it, but they can live with it. They have plenty of tools that will help them make up the difference. The Main Street community banks and credit unions are a different story. These small guys, who had nothing to do with the financial crisis, do not have that same flexibility the Wall Street banks have. These are the banks in Montana. These are the folks I want to make sure have a fair shake. So folks from both parties came together and said: How can I fix this to make this protect the local banks and credit unions since the original amendment does not?

Senator Corker and I suggested initially a 2-year delay, a study, and then more legislating to fix any problems that were identified in the study. The Senators who are here today with me thought we could do better, and we could, and we did. After talking with our colleagues, we worked together to reduce the study period down to, as I said earlier, 6 months.

At that point the Fed and other regulators will decide if the rules can adequately prevent the small banks from getting hurt. I do not know what the study is going to find, and I do not think anybody knows. If the agencies find that the rules consider all costs, that consumers would not be harmed, and that the small issuer exemption--those that apply to credit unions and community banks--if that exemption will work, then the pending rules would move forward as passed. I would be the first person in line to tell Senator Durbin that he was right about the two-tiered system.

But if the Fed and the other regulators find that the changes must be made to ensure that current rules do not include all costs or that small banks and credit unions and consumers might be harmed, then they will have to issue new rules within 6 months, and every 2 years the Fed would have to tell us in Congress whether these rules are still working for the small banks and credit unions.

That is all we are asking. Before the Fed's new rules get implemented, let's make sure we have them correct. Yesterday the good Senator from Illinois said this was not truly a compromise. But when you sit down with folks who think you are on the wrong track and you work together to find the middle ground, well, to me that is the definition of compromise.

Some other charges have been made about this amendment, and I would like to take a moment to discuss those. Some say it is a favor to the big banks. Well, it is not. In fact, this amendment corrects a very big problem that only affects the community banks and credit unions. The good Senator from Illinois said yesterday that he crafted this amendment with awareness that a major reduction in interchange fees would kill small banks and credit unions.

No one denies that small banks and credit unions would be deeply harmed if they are forced into a system where they can only charge 12 cents per transaction. No one denies that. This is why Senator Durbin tried to establish a two-tiered system. Under his proposal, big banks, the Wall Street banks, could charge one rate, 12 cents per transaction.

The small banks, the community banks, credit unions, could continue to charge a percentage of a transaction, 44 cents on average. But there is a big flaw in the plan. The two-tiered system simply will not work. Let me repeat that. The two-tiered system simply will not work. I did not make that up. Here is what the Chairman of the Federal Reserve said:

It is possible that the merchants will reject the more

expensive cards from smaller institutions, or because

networks will not be willing to differentiate the interchange

fee for issuers of different size. It is possible that the

exemption will not be effective in the marketplace.

That was Ben Bernanke saying that. He went on to say that because the exemption will not be effective, small banks could be hurt or even fail. Here is what the head of the FDIC said:

The likelihood of this hurting community banks and

requiring them to increase the fees that they charge for

accounts is much greater than any tiny benefit that the

retail customer may get.

Again, everyone agrees if the Fed's rules go into effect, the small banks and credit unions will suffer because the exemption simply will not work. So today we can stop and doublecheck to make sure that does not happen or we can just flip a coin and hope for the best and watch as more small banks and credit unions fail, reducing consumer choice and reducing banking options, especially as they currently exist in rural America.

These small banks and credit unions are the ones that make the loans to small businesses in rural America. They are in places where folks are still willing to put their money. They are the ones that folks in Montana still trust. They do not trust the big Wall Street banks. We probably will not lose too many banks in Washington, DC, or Chicago, IL, but we will in rural America. I do not want to see that happen.

Another good one that I have heard this week is the argument that the amendment will allow banks and credit unions to factor executive compensation into the cost of interchange fees. It will not. In fact, the amendment specifically states that the Federal Reserve and other banking regulators must look at the costs associated with debit card transactions and program operations.

We also know how dangerous it is to set a price for a product without understanding all of the costs that go into that product.

Home Depot would never allow the Federal Government to set the price of garden hoses simply by looking at the cost of manufacturing a garden hose.

No, Home Depot charges us for the cost of manufacturing it, shipping it, keeping it in stock, having someone tell you what aisle it is in, and on and on.

Likewise, if we are going to be regulating debit interchange fees, we need to understand all of the costs associated with debit transactions and debit programs.

When we voted on this amendment last year, we thought we were voting to allow the Federal Reserve to consider all costs. However, the reality is that last year's interchange amendment limited the costs that could be included. Some fraud costs were allowed to be included but not others. Some technology costs were included but not others. If we are going to be regulating this market, we need to be fair about it.

So the amendment directs the Fed to determine what is ``reasonable and proportional'' but it gives the Fed the discretion to look at all of the costs associated with debit transactions.

That does not mean executive pay. That does not mean a special rewards program.

All costs will still need to be justified, and if they cannot be justified they will not be considered. The Fed has been very clear with me--no executive pay, no bells and whistles.

But the decisions about the cost of routing networks, the costs of fraud and other technical details are much better left to the Fed than decided by the U.S. Senate.

Finally, Madam President, some have said that this amendment hurts consumers. It does not.

As someone who voted against the Wall Street bailout, who wrote part of the credit card reform act, and who voted for the Wall Street reform bill, I can tell you that if this amendment was somehow bad for consumers, I would not offer it.

In fact, the amendment requires the regulators to certify that the Fed's rules address consumer concerns.

The current law does not require anyone to look at the impact of interchange fee regulation on consumers. They are out of the picture.

I am not aware of any specific plans by any retailers to lower prices or provide customer rebates if interchange fees are lowered. I know that one large big box store held an earnings call at the beginning of the year where a company executive called the proposal to lower interchange fees a ``$35 million windfall.''

If I were a shareholder, that would have sounded pretty good to me. But as a customer, it is not clear how I benefit.

I understand that there are some folks who wish the amendment could go further to include additional consumer-oriented agencies such as the Federal Trade Commission as agencies that will conduct the study.

I would be happy to work with those Senators to see how we best protect consumers in this process. But the only way to make that happen is to get this amendment adopted; otherwise, the Fed's rules go into effect on July 21 regardless of what any consumers think.

I am looking forward to today's debate because we have an opportunity to address the unintended consequences of the Durbin amendment. Make no mistake, those unintended consequences will be felt all over rural America--and not for the better.

For the folks who think the two-tiered system will work, there is not a regulator out there who will tell you that it will. Some folks will tell you the Durbin amendment has an exemption for community banks under $10 billion and for credit unions under $10 billion. If they think that will work, there is not a regulator out there who will tell you that they can implement it and it will work because the free market system will drive it to the lower price. That is the way it is.

I am saying, let's slow down a little bit and make sure we get it right.

If we are going to create regulations, we are doing it in a way that is fair and consistent with the intent. Let's not try to solve one problem and create three others.

And let's not take shots at the folks in my neck of the woods who were not part of the financial meltdown.

That's all I am asking, and I urge my colleagues to support this amendment.

I yield the floor and ask unanimous consent that the time during the quorum calls until the vote be divided equally.

With that, I suggest the absence of a quorum.

Mr. President, let me take a moment here to clarify for my colleagues the intent of this amendment. Not surprisingly, a number of groups have made a number of claims about what this amendment ``is'' and ``is not.''

In drafting any regulations required by the amendment, any agencies involved are required to not only abide by the letter of the law but also the congressional intent of its authors.

Let me take a minute to try to make crystal clear what exactly the intent of this amendment is.

First of all, let me address some of the claims that have been made about the implementation date of debit interchange regulations. My amendment would direct the Fed to implement these provisions on a date of their determination.

Why was this language included in this way? The intent of this language is to provide the Fed with the discretion to implement these regulations as quickly as is practically possible for merchants, issuers and networks to prepare for such new regulations.

The hope with this language would be to avoid the situation we are in right now where parties impacted by these changes would likely have less than a month to implement significant changes to the debit interchange system.

To be clear, the Fed may not disregard implementation of debit interchange regulation, as some have articulated. They also may not arbitrarily decide to implement these rules 5 years from now. Any delay in implementation beyond a reasonable timeline of a few months would need to be justified by the Fed.

Let me also take a minute to address concerns that have been raised about the language we have used to describe what considerations the Federal Reserve must make if a determination is made in this amendment and the Federal Reserve is directed to rewrite the debit interchange rules.

The language states that the Federal Reserve shall ``consider''-- again, shall ``consider''--all fixed and incremental costs in determining what is a reasonable and proportional interchange fee. Let me say this again. The Fed shall ``consider''--not include, not calculate, but shall consider--all fixed and incremental costs. That word is important because ``consider'' provides the Fed with the discretion to consider and determine, using their judgment, what is reasonable and proportional, meaning any costs considered would need to be justified to the Fed.

To further clarify, the language directs the Fed to consider ``all fixed and incremental costs associated with debit card transactions and program operations and allow incentives for a more innovative, efficient and secure payment card network.''

Why did we include all fixed and incremental costs? That is because the original statute limited the costs the Federal Reserve could consider to only those costs associated with the ``authorization, clearance or settlement of a particular electronic debit transaction.'' This language severely limits the costs to issuers that the Fed may consider in calculating reasonable and proportional rates and is in large measure why the Federal Reserve's proposed rule is currently at 12 cents.

There are a number of fixed costs associated with debit transactions, chief among them fraud costs, which are also arbitrarily limited in the original statute. The fraud language states that the Federal Reserve may--not must but may--allow for a fraud adjustment for costs associated with fraud prevention. Now, the Federal Reserve draft proposal did not include any fraud adjustment, and we have no idea what an adjustment might look like or whether the final rule would include one. But if it did, it could only include an adjustment related to fraud prevention but not the actual costs or losses associated with fraud.

Take for example the recent data breach by Michaels stores--a breach, by the way, which was the fault of the retailer, which had their debit kiosks compromised. What were the costs to the issuer of the cards that were compromised? They were significant.

First of all, it was a community bank in Illinois that had a fraud- monitoring program that identified the threat and alerted the retailer their kiosks had been compromised. Then there were the costs to these issuers of making their customers whole again for the losses they sustained by criminals removing funds directly from their bank accounts--$500 at a time. Additionally, issuers had to foot the costs associated with reissuing the cards and opening new accounts for customers with compromised accounts. But none of those costs--those associated with fraud and losses assumed by the issuers--could be calculated in the fraud adjustment under the current statute. That is why we included language directing the Federal Reserve to consider all fixed and incremental costs associated with debit card transactions and program operations to capture those costs. Fraud losses in monitoring programs are not associated with individual transactions, nor is the creation or reissuance of physical cards, account maintenance, or cardholder servicing.

Let me also say what we do not believe is included in any reasonable and proportional fixed and incremental costs associated with program operations. As a result of our conversations and consultation with the Feds, we do not believe rewards programs or miles would be nor should be considered as permissible costs, nor would or should any executive compensation, nor should the costs of maintaining ATM machines.

Why did we include the language allowing the Federal Reserve, in setting reasonable and proportional rates, to ``allow incentives for a more innovative, efficient and secure payment card network''? We added it because, in conversations with the Federal Reserve about what sorts of costs would be included in reasonable and proportional costs, they indicated that right now they do not have the ability to incentivize savings by issuers to make processing more efficient or secure. It seemed like a pretty good idea to Senator Corker and me that we should give the Federal Reserve this kind of discretion and that issuers should be incentivized to lower costs below whatever the Federal Reserve determines to be reasonable and proportional; otherwise, the fee would likely stay the same for years to come as there would be no incentive to lower costs.

In addition to the flexibility provided to the Federal Reserve to set the rates, the amendment also intends to provide discretion to the Federal Reserve to include additional factors in the study, such as the overall impact of regulating interchange fees on small businesses and the economy, as well as discretion in the agencies the Federal Reserve may consult when drafting the study.

In addition, it is intended that the findings must be made public and that the Federal Reserve is not required to start from square one. The intent is for the Federal Reserve to be able to build upon the information and insights which they have gathered already and which are a part of the current record.

Finally, this amendment doesn't undermine or inhibit the Federal Reserve's ability to implement the routing and network exclusivity provisions in the underlying statute. In fact, it does quite the opposite. We sought to preserve this language and these provisions as they were originally included in the statute.

In the last couple of days, several Senators have suggested additional changes that would improve the consumer-related aspects of the study proposed by my amendment. I very much appreciate their concerns and their interest on this critically important point, and the changes they have suggested are certainly ones I and other cosponsors are open to. Unfortunately, the Senator from Illinois filed a second- degree amendment which essentially closed off any chance to make additional changes to the amendment once it was filed.

I am more than willing to work with my colleagues to find ways to continue to improve this amendment and to ensure that consumers, small businesses, small banks, and credit unions get a fair deal as we move to a regulated interchange marketplace. And that is what we will get out of this amendment--the same idea of regulation that 64 Members of this body supported last year.

The difference between my amendment and the current law is that we will ensure that the Fed's regulations do not set the price below the cost of doing business. The current law prevented the Fed from looking at any number of elements of the cost of interchange. Some fraud costs were allowed to be included but not others. Some technology costs were included but not others. Why? Because the Senate made those arbitrary decisions. The result is a proposed Fed rule that sets the debit interchange rate at 7 or 12 cents for all transactions--a level most folks agree is too low. Let's allow the Fed to find the actual correct number. As a farmer, I can tell you that if it costs me $3 to produce a bushel of wheat, it won't matter if I sell it for $2 or $1 or 50 cents, I will still go out of business because it is below my cost of doing business. And that is precisely what will happen to our smaller banks and credit unions.

With that, Mr. President, I yield the floor, and I suggest the absence of a quorum.

Mr. President, I too echo the thoughts of the good Senator from Illinois. Senator Durbin and I are friends. We may not sound like it today, but we are. We just happen to disagree on this particular piece of policy.

There is one premise that I think is being taken as a given that is not a given at all. It was in the original Durbin amendment. It said we were going to exempt banks of $10 billion and less and credit unions of $10 billion and less--so we are going to do that. A lot of folks voted for this amendment because they knew the small banks couldn't distribute their costs, and it would have undue harmful effects on the small banks, small credit unions, and community banks.

But the facts have borne out something different since the last year. They have not been borne out by stuff that I have made up. It comes from the regulators themselves.

I have said many times on this floor that every regulator I have talked to, State or Federal, has said the exemption for small banks and credit unions will not work. It will not work. We voted on something 1 year ago that we thought we had and it does not work. Let me read the quotes:

Fed Chairman Ben Bernanke:

We're still not sure whether it will work. There are market

forces that would work against the exemption.

He said it May 12 of this year.

Another quote by Chairman Bernanke:

It is going to affect the revenues of small issuers and

could result in some of the smaller banks being less

profitable or even failing.

Once again, in the banking area, by FDIC Chairwoman Bair:

I do think this is going to reduce the revenues.

Let me say that again:

I do think this is going to reduce the revenues at a number

of smaller banks and they will have to pass it on to their

customers in terms of higher fees.

What does that mean? Checking, time getting the loan, fees, all that stuff. Money doesn't grow out of air. You have to have it, and if you don't have it and you are doing business, under the cost of doing business you have to make it up somewhere.

Another quote from Ben Bernanke, and it is about the two-tiered system that is unlikely to maintain--to protect smaller institutions. This is a quote:

A number of networks have expressed their interest or

willingness to maintain a tiered interchange fee system, but

of course it is not required.

Chairwoman Bair again:

If the Federal Reserve's view is there is no legal

authority to require that, it does become more problematic.

The fact is, the two-tiered system is not going to work. Every regulator said it is not going to work. Its impacts are going to be on small community banks, not the Wall Street boys. They are fine. We agree on that. But the community banks and credit unions are going to have incredible impacts on our small businesses that we are trying to help get us out of this recession we are in.

This is not a bailout. This will ensure a regulated debit interchange system. By the way, I do not believe in bailouts. I didn't believe in the TARP bailout. I voted against it. I voted against the auto dealers' bailout. Right or wrong or indifferent, I do not believe in bailouts. I would not be supporting this if there were a bailout. I would not be offering it.

Wall Street banks are going to be just fine regardless of what happens, but the fact is, the exemption for banks under $10 billion will not work. That is why I am here. It is as simple as that.

I wish to close for now with a statement made by the ``Frank'' in Dodd-Frank, whom this bill is named after, Barney Frank, who worked with Chris Dodd to craft this bill in the House and Senate. Here is what Barney Frank says. Is today the 8th, by the way? He said it today, the 8th of June, speaking of the Tester-Corker-Hagan-Crapo-Bennet amendment, this amendment:

This is a good, balanced, compromised approach. I support

it and I hope it will pass.

The author of this bill from the House thinks this is a good policy change to make Dodd-Frank better.

I yield the floor.

Mr. President, just to clarify, I have 2 minutes, Senator Durbin has 2 minutes, and then we vote?

God bless the U.S.A.

Mr. President, let me say this, first of all, to the folks in the gallery and the Members who are still in their offices. Look at me. Do I look like a banker? Senator Corker and I drew up this amendment. The banks did not draw up this amendment. We drew it up with the help of Senators Hagan, Crapo, and Bennet.

As is usual, Senator Durbin and I agree on 90 percent, and there is 10 percent on which we disagree. Do I think swipe fees need to be regulated? Of course. But the problem with his amendment is that the exemption on community banks and credit unions under $10 billion does not work. It doesn't work. I have read all the quotes from Bernanke and Bair and the head of the OCC and the NCUA and all of them. They have said that they don't know how to make a two-tiered system work because the free market system will overrule it, and that is the way it ought to be in this country.

So the bottom line is, I look at this from a rural perspective and the impact the Federal Government has on rural America, and while we are trying to solve one problem, we are creating two or three others. I could care less about the Wall Street banks. They are going to do fine. But I will tell my colleagues, if we lose the banks in our small towns in Montana or Wyoming or Tennessee, then we can put another nail in the coffin of rural America.

With that, I yield the floor to the good Senator from Tennessee.

I ask for the yeas and nays.

Madam President, I thank my colleague from Wyoming. Our relationship and friendship has been growing over the years. I respect him so much as one of the real voices of retailers and small business. I had an opportunity to spend some time visiting China with him and his wife. We got to sit down and talk about their lives and what they have been through.

My colleague knows the small business side of this world better than anybody who sits in this Chamber. As I listened to him talking about the solution to this problem, I could not help but nod affirmatively. There is no reason we should have had to vote a year ago to establish this interchange fee. It reflected the fact that retailers, small businesses, merchants, hotels, restaurants, and shopkeepers across the board were literally given no seat at the table to discuss the fairness and propriety of these interchange fees. The point he made drives it home. The credit card networks, working through the banks, are charging our businesses in America the highest interchange fees--that is the fee charged every time someone swipes that plastic debit card--of any country in the world. The interchange fee in Canada is zero; in the United States, 44 cents on average on every transaction.

I could not agree with the Senator more. If the banks would come down out of their ivory towers on Wall Street and other places and sit down, roll up their sleeves with the folks running shoe stores and grocery stores and hotels and restaurants, and say all right, we are going to come up with a fairer system--if it is zero in Canada and it is 44 cents here, there is a number in between that can make sense to both sides. If that were the case, the Senator and I would be working on some other issues rather than this one.

But my colleague is so right. Today we have to defeat the Tester- Corker amendment; otherwise, we are sending a massive subsidy to the biggest banks on Wall Street, up to $8 billion a year that they collect in these debit card interchange fees at the expense of small businesses and consumers all across America.

I thank the Senator for his support. I know later this afternoon at 2 o'clock when we face this vote it is an important vote for every small business in his home State and mine as well. I thank the Senator for taking the floor.

I suggest the absence of a quorum.

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

Mr. President, I have high regard for the Senator from Montana. He is my friend, and he will be my friend whatever the outcome of the vote happens to be, which will happen in about 40 minutes. But I do disagree with him on this issue.

I would like to make it clear from the start that the law on the books today specifically exempts community banks and credit unions-- specifically those valued at $10 billion or less. That means 100 banks out of 7,000 in America are affected by this new law and 3 credit unions in all of America.

Now, the banks and credit unions have come here and said: Not enough protection because we can't be sure you will protect us from the credit card companies coming back on us and hurting us. OK, we can write in more protection, if necessary. But to argue that we are trying to save mom-and-pop banks here--from whom? We are trying to save them from the credit card giants that have created this price-fixing mess.

If you are an autograph seeker and you happen to want to meet CEOs of major corporations, you hit it rich today. Get over here and walk the halls of the Senate office buildings, and you will meet the CEOs of the biggest companies and banks in America. Why are they here today? Because of this 2 p.m. vote. Why is this 2 p.m. vote important to the three biggest banks in America--Chase, Bank of America, and Wells Fargo? Because right now what is at stake with the Tester-Corker amendment is $8 billion in fees they want to collect from consumers and businesses all across America--$8 billion.

When we got into the business of TARP--remember those days when the

banks had messed up the economy so badly that we had to come to their rescue with taxpayer money, and the average family across America watched the taxes they were paying this government going to the biggest banks on Wall Street? That was about $800 billion. The three biggest banks that will profit the most here from this amendment--Chase, Bank of America, and Wells Fargo--each was a beneficiary of that TARP money, that bailout money. Chase received $25 billion, $45 billion went to Bank of America, and $25 billion went to Wells Fargo. They did quite well. When we rescued them, they sent us a little thank-you card. Do you know what it was? It was a notice that they were giving their chief executives bonuses out of the tax money we were sending.

So the question is not whether we are going to do another TARP today but whether we are going to do a baby TARP. It is only $8 billion for these three big banks this time, but I think it is an outrage. It is an outrage to make consumers across America pay this. They pay it every time they use their debit cards, and the merchants and retailers that collect it have no voice in this process.

I wish some of the people who come to this floor and shed copious tears over community banks and credit unions that are already protected in this law would shed a few tears for the people who run the shops and businesses across America, the restaurants and the hotels. These are the people who are being hit by these debit card fees every single day. Where is the sympathy for small business on this floor? They are all over Illinois, they are all over America.

If we really believe the key to economic recovery is the strength of small business creating and expanding jobs across America, for goodness' sake, let's stand up for them. You can't vote at 2 p.m. for this pending amendment and say you are a friend of small business. No, you can't. Small business is lined up across America saying: For once, give us a break against these credit card companies and the big banks on Wall Street. Give us a break. Are we going to do it? I am afraid not, if we pass this amendment.

I look at this amendment and I think to myself, Why did the banks write it the way they did? They wrote it so they could include more costs into their calculation of the fee they charge on an interchange transaction with debit cards. I will tell you this: Based on the language that was just read to us, they will easily justify the 44 cents they are currently charging and more.

I respect my colleague from Montana when he says on the floor that he didn't mean to include certain things. I wish he had been specific. I think the language of this amendment is broad enough and wide enough to drive a truck through. The banks are going to come out quite well, thank you, at the end of the day. But don't they always? When it is all said and done, aren't they usually the winners around here?

Today, we have a chance to turn the tables, to really make the winners small businesses and consumers across America. That is why consumer groups support keeping the law as it is. That is why, when the banks wrote this, they said the four agencies that would decide what the fee was going to be would be four bank regulators. I am searching-- searching, searching--for any reference to consumers or small businesses. Sorry, the banks couldn't include those people. They couldn't include those people in that calculation.

To say ``We are for the little guy, and that is why we need to vote for this amendment'' is to ignore the amendment's wording as written. If you are for the small businesspeople across America, there is only one vote, and it is a ``no'' vote.

Let the Federal Reserve issue this rule. Don't let the banks stop them in their tracks. That is exactly what they want to do. Let them issue this rule. If more needs to be done, I am on board. But the notion that we cannot even trust the Federal Reserve to come up with a rule on this that may protect small businesses and consumers across America is just plain unfair. It is wrong and we ought to know better.

I reserve the remainder of my time.

How much time is remaining?

Is there any time remaining on the other side?

Mr. President, if Senator Tester returns to the floor and wants to speak before the vote, I will ask unanimous consent to each have 2 minutes for that purpose. Perhaps he is not going to, but I want to make this a matter of record here because I want to give him a chance to close.

Let me try to get down to basics. Have my colleagues ever pulled out one of these cards to pay for something? If you are my age, you don't pull it out as often as younger people. This morning, I was down in the carryout here, and a young woman who is a Capitol police officer bought a pack of chewing gum for $1.20 and handed over her debit card. The debit card was swiped. She took the chewing gum and walked away. The average amount that is charged by the issuing bank of her debit card is 44 cents for each transaction. How much money do we think the owner of the carryout made on that pack of gum this morning? The answer is nothing. Now repeat that over and over again across America.

What is happening is that the banks issuing these debit cards are imposing interchange fees, swipe fees, on these transactions, and the merchants and the retailers have no voice in the amount of that fee, no voice whatsoever.

The Federal Reserve did a study and asked: Well, how much does it actually cost them to process that debit transaction? The answer was 12 cents, in the range of 12 cents. The charge is 44 cents; the cost is 12 cents. Is there something wrong with this picture? It means every person buying goods at stores across America pays more to pay for this fee.

We have heard the plaintive cries of those offering this amendment of how we have to have some sympathy for these banks--these poor banks, struggling to survive. If they can't collect the maximum on their debit fee interchange fee, the swipe fee, what is going to happen to them? Well, we have already exempted, incidentally, all banks with values of $10 billion and less, so we are talking about the big boys, the big banks.

So let's ask a few basic questions.

How does the debit card interchange fee in America compare to other countries? Visa and MasterCard do business all around the world. Banks issue these all around the world. So how do we stack up? Where is the good old U.S. of A? Well, I will tell my colleagues where we stack up. We have the highest interchange fees charged by Visa and MasterCard anywhere in the world--the highest. Thank you. Can America express its gratitude any greater than to say thank you to the banks for charging us the most for using plastic?

So what do they charge in other countries? Debit interchange fees in the European Union are less than one-fifth the charge in the United States. So let's do the math: 9 cents a transaction in Europe, 44 cents here. We want to give a big, sloppy kiss to these big banks at 2 o'clock for the way they are going to treat us. But it gets better. When we go to Canada, the Visa and MasterCard debit interchange fee in Canada is zero. There is no interchange fee. Now we have people on the floor begging us to show some sympathy for these banks and give them an interchange fee, and they charge nothing in Canada--zero. That is the reality.

The biggest banks make the biggest money on this process, far and away--Chase, Bank of America, and Wells Fargo--to the tune of almost $8 billion a year. How long did they want to study interchange fees? If one is making $1.3 billion a month, one wants the study to go on for months, if not years. Get back to you later, we say to the banks. Yes, that is exactly what they want. At 2 o'clock, we will decide as a Senate whether we are going to give it to them.

This amendment, drawn up by the banks, compromises between the banks, gives to the banks exactly what they are looking for--a huge loophole to assess their interchange fees to justify what they are charging today and charge more. There is nothing in here--nothing--to protect consumers and businesses across America.

I got started in politics with a fellow named Paul Douglas. This goes back a few years. I was a college student. Douglas was a Ph.D. in economics--much smarter than I, for sure. He spent his whole life trying to pass something called truth in lending. All he wanted the banks to do was to tell their customers how much they were charging them and what interest rates. He spent 18 years battling that, and he left the Senate without getting it done. He couldn't finish it. Bill Proxmire of Wisconsin took up the battle and passed it. Paul Douglas fought those banks for 18 years.

It is a battle that has been going on a long time around here because, you see, there is a lot of power in this banking community, these financial institutions. When they come to the floor and say they want something, Congress decides, we better start talking. Rarely do they ever lose.

I guess we could say the Wall Street reform bill was a loss for them, but they deserved it. Look at the god-awful mess they put America into with their rotten practices, their stupidity and reckless conduct. We are still paying for that. We still have a lot of people out of work and businesses that failed. Many of the savings accounts of families across America are still suffering because those banks made those mistakes. And in the free market system, did they pay for their mistakes? No. The American taxpayers paid for their mistakes.

Giving credit where it is due to Senator Tester, he voted against the TARP bill. He said it, and I want it to be on the record. I voted for it. I did because I was told by Ben Bernanke of the Federal Reserve and Hank Paulson of the Department of the Treasury: If you don't help these banks and they fail, you will see a worse depression than 1929. I bought it. I voted for it. Almost $800 billion in bailouts to these banks. I was seething to think we were going to spend taxpayers' money to help these banks be rescued from their own stupidity and their own greed. We did it.

The three biggest banks involved here--some $95 billion we sent to them. Well, they are back. They are looking for the second installment on their payment, this time not from the taxpayers, this time from consumers and businesses across America. What they are asking us for, the biggest banks, the three biggest ones, is almost $8 billion a year in these interchange fees.

We have a chance now to try to bring some balance to this conversation. We have a chance to finally stand up for small businesses and merchants and consumers across America who have been victimized by the credit card companies and the big banks for too long. Can this Senate stand up once a year, once a decade for consumers across America against these financial institutions? That is what is at stake with this amendment. I know it is going to be a heated vote because my poor colleagues have been beaten to a pulp by both sides by those who feel very intensely about this issue.

I wish to credit my colleague from Montana because he told me at the outside--when I said, Jon, please don't do this, he said, I believe it. And, Jon, I admire you for doing it. I still do. Even though I disagree with you, I admire you for doing it. You are a man of conviction and principle and a great Senator.

But this is a historic moment in the Senate. It is a moment where we will decide whether for once the big banks are going to lose and the consumers are going to win; whether we are going to reduce the cost of these transactions and help consumers across America and small businesses across America make the profit they need.

Some people say: Well, this hasn't been studied enough. For 11 months now, the Federal Reserve has been studying this, the best economists, the best minds there. They have entertained 11,000 comments. They have heard everything under the Sun. They have heard it all. In a matter of days, they are set to issue a rule--a rule which no one has seen, a rule which the banks don't want anyone to see. They don't want this rule to see the light of day, and that is why they are here today--to stop the Federal Reserve from issuing a rule that may cost them in terms of their bottom line.

It is our choice now. It is our choice whether these banks are going to prevail. History will record the strength of consumers and small businesses across America against the Wall Street banks that take away more than half of the interchange fees on debit cards that are collected across America.

I hope my colleagues will stand by the decision we made a year ago. I hope they will give each of us an opportunity to see this rule come into effect and from that build on it a stronger, growing economy, one that is fair--an economy where interchange fees have been dictated by the big banks and credit card companies for too long.

I reserve the remainder of my time. How much time do I have remaining?

I mentioned on the floor earlier that I would like to give to my colleague 2 minutes, and then I will take 2 minutes, and that will be it. So I ask unanimous consent.

Mr. President, I understand I have 2 minutes?

Mr. President, if my colleagues are interested in smalltown America, they should be interested in the businesses that operate in smalltown America, and they are begging us to vote no on the Tester-Corker amendment.

I happen to live in a town of 120,000 people. It is a little bit larger than my colleague's hometown in Montana, but I can tell you what the businesses there are saying. I can tell you what Wendy Chronister is saying, who owns the Qik-n-EZ gas stations. She is saying to me: Give me a break. They are hitting us so hard with these debit interchange fees.

We have letters put in the Record from military base exchanges which say this is the fastest growing, uncontrollable cost they are facing. This is a problem which the credit card companies and the banks have wanted to ignore and now this amendment wants to delay for 6 months, a year, or longer.

In terms of trusting the regulators, I am afraid the banking interests that wrote this amendment did not trust them to even issue the rule. You had to call this debate before they issued the rule. You do not know what the number is going to be on the interchange fee, but you had to stop them in their tracks.

If you will go look in the corridors and rooms around Capitol Hill, you will not find a lot of small town bankers.

You will find the biggest banks in America waiting in the wings, praying, putting in a billion dollars' worth of prayers that this amendment is going to pass.

I do not question the intentions or motives of Senators Tester or Corker. I never will. But I can tell you, the effect of this amendment is going to be giving to those big banks and those credit card companies a windfall of profit they do not deserve.

If the interchange fee is zero in Canada, why is it 44 cents here? Can we stand up, representing the people of this country, and say that is fundamentally unfair; you have to treat our consumers and merchants fairly? If we cannot stand up and do that, why are we here? To do the bidding of the banks and the credit card companies? I hope not. I hope we are here to stand up for economic fairness and for consumers and small businesses across America begging us to defeat this amendment.

I yield the floor.

I suggest the absence of a quorum.

I object.

I announce that the Senator from Connecticut (Mr. Lieberman) is necessarily absent.

I Object.

Mr. President, let the games begin. That is what is going on here. I have full respect for my colleague, but you can tell from his tone and tenor that Senator Paul finds it amusing he is offering a clean debt ceiling increase that he is voting against. He is offering an amendment he is voting against, when we know we are in discussions with the President, and with the Vice President, and discussions with the Gang of Six to try to figure out a way that we can come together, not have ``gotcha'' votes on the Senate floor. It is outrageous.

I will tell you why it is outrageous. We have an underlying bill here that you have been very helpful with, Mr. President--S. 782--the Economic Development Revitalization Act of 2011, which will reauthorize a very important program that has been in place in this great Nation since 1965. It was last passed when George W. Bush was President. It passed this Senate unanimously, without all these amendments that are going nowhere.

There are 27 amendments as of last night--actually, it is probably many more now. We know this game because we played it before, when Senator Landrieu stood where I am and tried to get a small business bill through here, which would have created thousands of jobs in this Nation.

Well, here we are. We have a bill that came out of the Environment and Public Works Committee with a strong vote. We had one dissent. Senator Inhofe is my primary cosponsor. For 50 years, this EDA program, the Economic Development Administration, has created jobs and spurred growth in economically hard-hit communities.

We know the struggle we are having in coming out of the greatest recession since the Great Depression. I remind the people within the sound of my voice that when President Obama took over, this country was bleeding almost a million jobs a month. We are getting back on our feet. We got the auto industry back on its feet. We are getting manufacturing back on its feet, but it is too slow. We have to do more. Once in a while, we get an opportunity to work with small businesses, the private sector, local government, and attract funds from nonprofit organizations and bring jobs and important work to our communities. This is one way.

An arm of the Chamber of Commerce wrote me a letter yesterday saying how important this work is. The Business Civic Leadership Center said:

EDA has served as a valuable partner in many communities

that we have worked in including San Jose, California;

Seattle, Washington; Cedar Rapids, Iowa; Mobile, Alabama; New

Orleans, Louisiana; Atlanta, Georgia; Boca Raton, Florida;

Minneapolis, Minnesota; Newark, New Jersey, and many others.

It was signed by Stephen Jordan, executive director of the Business Civic Leadership Center of the U.S. Chamber of Commerce.

This is a bill everybody wants, but games are being played in the Senate--I guess just for the fun of it, to stop us from doing our job. What is our No. 1 job? To create jobs. What does the AFL-CIO say? You have business and labor. They say:

EDA has established an admirable track record in assisting

economically troubled low-income communities with limited job

opportunities by putting their investments to good use in

promoting needed job creation and industrial and commercial

development.

That is signed by William Samuel, director, Government Affairs Department, AFL-CIO, and that is dated yesterday.

Why is business and labor supporting this bill? Why do they want us to stop the games and pass this bill? Because they want jobs for businesses, and businesses want the work.

Now let's take a look at other people who were supportive in addition to the Chamber of Commerce and AFL-CIO: U.S. Conference of Mayors, American Public Works Association, National Association of Counties--I was a county supervisor and belonged to that organization many years ago. If you want bipartisanship, go to the National Association of Counties. There are Democrats, Republicans, Independents--people of every stripe, liberal, moderate, conservative. They all come together. Why? Because business and labor are together, and everybody wants jobs.

Why do we have to face an amendment by my friend Senator Olympia Snowe on deregulation--a bill that hasn't had one hearing in any committee and will, in many ways, eviscerate the important rules and regulations that protect public health and the environment? We should have a hearing on that bill. I am sure we can work together and make it a wonderful bill. Instead, it is offered on this bill.

Not at this time, but I will yield when I conclude.

We have a bill that will create tens of thousands of jobs, and we have the first amendment offered by my good friend, which has not had one hearing, and it repeals all kinds of protections for the public health.

I don't get it. There is only one thing that I can get, with all these amendments, we have amendments on the debt ceiling that have nothing to do with this bill. This bill will create income for taxpayers, because when jobs are created and people work, they pay their fair share of taxes. This bill does not deserve to be treated this way when it passed almost unanimously out of the committee and it is totally bipartisan and has been in place for almost 50 years. Yet that is where we are.

Every Senator has the right to do what he or she wants. They can play games. They can have fun. But I care about the people I represent, and they need jobs. I care about them whether they are in Kentucky, California, or Maryland--any State in this Union. We are United States Senators. We should care about the people, not get up here and play games.

EDA uses limited Federal dollars to leverage large amounts of private sector investment. It is the little spark that creates economic activity in areas that are distressed, and it creates these jobs all across the country. Every dollar of EDA investment attracts nearly $7.

Let me show some other charts. When we vote for this bill--and this is an authorization, by the way, not an

appropriation. We have authorized it at $500 million. Historically, in the last couple of years, it has been funded at about $300 million, $250 million. But every dollar attracts $7 from the private sector, and that is a fact. It was documented in congressional testimony made on March 3, 2011. So that is the history of this EDA.

People say, well, how much, Senator, do these jobs cost--each job? Well, here is what we know. One job is created for every $2,000 to $4,000 invested. So it is an average of somewhere around $3,000 a job. That is a good return on our investment. We know that between 220 and 500 jobs are created for every $1 million of EDA investment.

Here is what we know. Between 2005 and 2010, 450,000 jobs were created by these investments and 85,000 jobs were saved. Everybody in this Senate, I think--though I could be wrong--if asked what is the most important thing we have to do today, would answer it is to help spur job creation in the private sector. Most of these are in cooperation with the private sector. Sometimes they are sewer projects or water projects that are needed by the private sector.

Let me cite some examples of that. Since we are authorizing this, at this stage, at $500 million, one might ask, how many jobs would be created each year. It looks as if it would create nearly 200,000 jobs per year and between 430,000 and 1 million jobs over the life of the bill.

But let me use some examples, because this isn't rhetoric. This is a program that has been in place since 1965. The city of Dixon, in my home State, got $3 million for a water system that will increase the city's water supply and their storage capacity, which will eliminate a major impediment to planned development and expansion of the city's commercial industrial areas. When you don't have enough water, you can't expand. I learned that when I was a county supervisor. You need to make sure there is adequate water, adequate electricity, and adequate sewerage. You have to make sure there are adequate roads. All these things are necessary for development and job creation.

This project is expected to create 1,000 jobs and leverage $40 million in private investment. So we have a $3 million investment to improve the water system and it is going to leverage $40 million. I call that a good deal for our taxpayers and a great deal for the American people to see jobs created. So we have 1,000 jobs--good jobs-- created. That means 1,000 dads and moms bringing home paychecks for their families.

But what do we have here? The same thing Senator Landrieu had to put up with--amendment after amendment after amendment that has nothing to do with this bill. We even had an amendment from a Republican friend that would do away with this entire agency. Unbelievable.

The city of Shafter in my State, $2 million for sewer and water improvements to serve the East Shafter Logistical Center, which will allow development of an additional 600 acres to enable continued growth of the center and support a multimodal transportation hub. This project is expected to create 1,400 jobs and leverage $200 million in private investment. So that is a $2 million investment that is going to be leveraged, leveraged, leveraged.

We are going through a time when we have to cut spending, and I love when the Republicans lecture Democrats about that. Wait till you hear what goes on here. Guess which party was the only party that balanced the budget and created a surplus in recent memory. The Democrats, with Bill Clinton. So don't lecture us about how to balance budgets. We know how to do it. And guess what. We know how to do it while creating 23 million jobs. So I don't need to hear the lectures, because they are misplaced. Talk to yourself. You are the ones who didn't say a word when George Bush did a tax cut for billionaires and put it all on the credit card. Now you still want to extend those tax cuts and bleed the revenues.

I will not yield. I have stated that before, but thank you for asking.

Here is where we are. I have to reiterate so I don't lose my place. Under Bill Clinton, the Democrats balanced the budget, created surpluses and 23 million jobs. George Bush came in and he held a press conference--I saw a rerun of it last night--and said, we don't need surpluses. This money belongs to the American people. Well, he didn't say what he meant. He meant it belongs to rich people--superrich people who earn over a billion and over a million dollars. He gave away the store. Then he went to war--two wars--and put that on the credit card. My friends on the other side never once said, Gee, I can't raise the debt ceiling to pay the debt. They all voted to pay. Almost to a person, they all voted to raise the debt ceiling, and it was doubled from when Bill Clinton was in office. But now, after George Bush left a mess--a god-awful mess in the debt and the deficit, and he handed President Obama a $1.2 trillion deficit--all of a sudden they blame President Obama for all of this.

The American people get it. They do not buy that. They understand this. They are not happy where we are, and they shouldn't be, but they know where the problem started. You know why. Because you can't rewrite history. You could try, but those deficits and those debts--those numbers--are in the books. Unless you erase them, they will remain in the books. I don't care whether it is talking about Paul Revere's ride or the deficits, that is history.

Let me show the deficits we had when we were in control. We got it down to zero, and we got surpluses and created 23 million jobs. That all was erased when we entered a situation in the last couple of years of the Bush administration, where jobs were bleeding at 800,000 a month, 700,000 a month, credit was frozen, and the automobile industry was in the tank. President Obama took action, but this recovery is tough. It has been the worst recession since the Great Depression.

This is what I know. We can do this if we work together, dare I say it? We can adopt a framework that understands billionaires and millionaires don't need their tax cuts now. We can get some more revenues in here and cut the fat and cut the duplication and go after the people who don't pay the taxes they owe. We can end the war in Afghanistan and save $1 trillion over 10 years. I can come up with $4 trillion easily. Allow Medicare to negotiate with the drug companies for lower prices. How is that--$200 billion?

But, no, instead, there is demagoguery and there are attempts to bring down bills such as this--clean, nice bills that will do everything we know we need to do now--leverage our spare dollars, attract public investment, create jobs and create jobs. But, no, we are facing a host of amendments, and I don't find it funny. I find it sad that we cannot come together.

I have a city in California, a very fast-growing city in the Silicon Valley--San Jose. We got them, through this program, $3 million for the renovation and expansion of the Center for Employment Training. What do they do there? They teach skills so when there are certain job losses going on, we have people with these new skills. We increased that center's capacity by 860 students. We expanded access to a GED, so people who didn't finish high school could get their diploma. We taught them how to speak better, how to read better, and we taught them small business entrepreneurship. This is what we are expanding to new people.

This project is going to create 4,900 jobs and leverage $3 million in private investment. This project was one to one. It was $3 million in public investment, $3 million in private investment, with 4,900 new jobs predicted.

By the way, these are not earmarks. We have six regional offices and there are applications made for these grants. They are made by the EDA and it is under the Commerce Department.

On the west coast, in 2003--to prove some points here--EDA invested $1.8 million in the construction of a water and energy technology incubator in the Central Valley of California. For those who don't know the Central Valley, it is where you get a lot of your fruits and vegetables. They are struggling in this downturn. In 2003, according to EDA, the incubator has housed more than 15 entrepreneurs since it opened, and those entrepreneurs have obtained over $17 million in private capital and created jobs for the Central Valley. So

a $1.8 million investment in the construction of a more than 2,300 square foot incubator for a water and energy technology business, and look what happened. From that small investment, it attracted $17 million. That is a huge leverage--a huge leverage.

You all know Boeing Company. In order to help mitigate the Boeing Company's decision to reduce manufacturing jobs in Renton, WA, EDA invested $2 million in 2006 to help build infrastructure to serve the commercial redevelopment of a 42-acre former aircraft manufacturing site. The redevelopment has created a mixed-use campus used by businesses focusing on commercial services, high-tech and life sciences, and helped create 2,500 jobs.

In the Midwest--I talked about this yesterday--in the city of Duluth, MN, they did something terrific there. They gave a grant of $3.5 million, matched by a city grant of $2.3 million, and they set up this aviation business--the Duluth Aviation Business Incubator at the Duluth Airport. This investment helped a company named Cirrus Aircraft grow from a handful of employees to a thousand employees by 2008. This incubator is now leased to Cirrus Design Corporation, which has the largest share of the worldwide general aviation market.

What we are talking about here is planting a seed of economic development, and that seed attracts more seeds from the private sector, from the local people, from the nonprofits. At the end of the day, what have we done by that little seed? It has grown. And this has been happening since 1965 when this program was created.

By the way, you will be shocked to know it was authorized at the same amount of money in 1965--$500 million. So the fact is this isn't a program that has grown and grown; it has stayed the same. That means, if you put inflation into the equation, it has been dramatically cut to a tiny part of what it once was for the country, but it is a beautiful part of our economic growth.

What do we need today? Jobs. What is the second thing we need? Jobs. And what is the third thing we need? Jobs. I am not amused by 27, 28, 29, 30 amendments, some of which have nothing to do with what we are talking about.

One of my friends on the other side of the aisle has an amendment that is pending to repeal banking reform--everything we did and worked on. I guess he wants to go back to the days when the banks got bigger, bigger, gambled with our money, and we almost lost capitalism in this country. OK, that is his right. Why is he doing it on this bill, without a hearing?

Another colleague has an amendment to end the regulations, I say to my friend, that protect the health and safety of the people. Not one hearing on it.

I think the American people have to wake up, so I am saying: Wake up, America, today. Wake up and pay attention to what is happening.

We have a bill on the Senate floor that is meant to do one thing-- create jobs in areas that have been hard hit by this bad economy. Why are the Republicans stalling it, hurting it, putting forward amendments that have nothing to do with it? We have to ask that question. They voted for it under George Bush unanimously, the same program. They voted for it nearly unanimously out of our committee, I say to my friend who is a senior member and a great chairman of the subcommittee on our committee--they voted for it. Now they are delaying it and offering all these poison pill amendments to it.

This is the second time they have done it. America, you have to wake up. It is the second time they have done it. They did it to the small business bill. They hurt small business. They are doing it to this bill. They are hurting job creation, and they are hurting small business again, and they are hurting big business. I said before, one of the provisions helped Boeing.

Maytag, there is another company you know the name of. In 2007 the Maytag plant, headquartered in Newton, IA, which employed 1,800 factory workers, was closed. By 2008 the city identified two new manufacturing operations that could be located on the old site: TPI Composites, a wind turbine blade manufacturer, and Trinity Structural Towers, a manufacturer of massive steel towers for windmills.

Can I ask my friend if he would like some time on this? I am going to continue telling the Maytag story. When I finish, I am going to turn to a very important member of the committee, Senator Cardin, for some remarks.

EDA invested $580,000 in 2008 for grading, site preparation, and surfacing for a wind tower storage facility that was leased to Trinity. That $580,000 attracted $21 million in public investment. That same year we saw other investments in Iowa.

I am going to stop and yield the floor so my friend can ask unanimous consent that he be recognized.

Right now we are on the bill.

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

Madam President, I wish to take a few moments to talk about the Republican budget, the so-called Ryan budget in the House. This has been widely condemned, of course, for its plan to end Medicare and for its radical cuts to Medicaid. But I have come to the floor to highlight yet another extreme element of that Republican budget--its unprecedented assault on education funding and the grave threat this poses to school reform efforts across the United States.

This Republican budget would slash funding for education by 15 percent next year--2012. Even more drastic cuts to education funding would come in each of the years to follow.

These Draconian cuts to education could not come at a worse time for America's public schools. The final budget agreement for the current fiscal year reduced education funding by $1.3 billion. It zeroed out, for example, the successful Striving Readers Initiative, the only comprehensive Federal program to help struggling adolescent readers. I might just add, that budget ended all literacy programs for kids in America funded by the Federal Government. The Federal Government now does not fund one literacy program in America. That is how bad it has gotten. Meanwhile, cash-strapped State and local governments are slashing school budgets and firing tens of thousands of teachers. In Texas, Gov. Rick Perry has called for a $10 billion cut in education funding. In New York City, the mayor, Mike Bloomberg, has proposed laying off 6,000 teachers.

I have an unusual perspective, as both the chair of the appropriations subcommittee that funds our Federal education programs as well as the chair of the authorizing committee, the Health, Education, Labor, and Pensions Committee, which authorizes education programs.

There is no question in my mind that combined Federal, State, and local budget cuts pose a grave threat to education reform efforts across the country, just as these efforts are reaching a critical mass. Here is why. Forty-eight States and the District of Columbia have collaborated to create high-quality common education standards for the first time. The Obama administration's Race to the Top Initiative has jump-started ambitious State-level reforms ranging from expanded charter schools to stricter teacher and prep school accountability. In the HELP Committee, Senator Enzi and I together are working on a bipartisan effort to reauthorize the Elementary and Secondary Education Act.

However, it is wishful thinking to expect improvements in school quality at a time when we are laying off teachers, increasing class sizes, and reducing instructional time. I am struck by the fact that the Republican budget's assault on education comes at a time when America's competitors are surging forward. For example, China has tripled its investment in education and is building hundreds of new universities. Even in times of austerity and shrinking budgets, smart countries don't just turn a chainsaw on themselves, they continue to invest in the future and, above all, they continue to boost investments in education.

So as we go forward with education reform in the United States, we are building on strength. Most kids in affluent communities already attend high-quality public schools and go on to higher education. Our challenge is to ensure that all American students have this opportunity, including the nearly 20 percent of children who live in poverty.

Again, certainly money is not the only factor in creating high- performing schools, but it does take money to modernize school facilities, to hire highly qualified teachers, to create effective assessment systems, and to provide appropriate instructions for students with special needs. To demand reform without resources is to set up students and teachers to fail. Let me repeat that. To demand reform without resources is to set up the students and the teachers to fail.

In the months ahead, Congress will be focused on reducing the deficit and trying to prevent a default on America's debt obligations. Of course, this is appropriate. But it must not preclude sustained, strong investments in education for our young people. We need to invest more, not less, in helping States and districts to close the gap between world-class schools that are in the affluent suburbs and the struggling schools in poor, urban, and rural communities. We need to provide resources to ensure that the goal of graduating students who are college and career ready applies equally to all students, including kids with disabilities, including English language learners. In the face of steadily rising college tuition, we must maintain the maximum Pell grant so kids from low-income families can achieve the American dream and get a college education.

Pundits have attributed the GOP loss in the special election in New York's 26th congressional district to voter anxiety because of the plan the Republicans have to end Medicare. So a lot of the pundits have said: Well, this recent election in New York's 26th congressional district is the result of that. But public dissatisfaction with the Republican budget goes way beyond Medicare. Americans see this budget as unbalanced and unfair, especially when it comes to education.

The American people are asking: Why do the Republicans insist that trillions of dollars are available for new tax cuts, mainly for big businesses and the wealthy, but supposedly we cannot afford to sustain funding for public education? This is a classic case of eating your seed corn. It is an approach that does not remotely reflect the priorities and values of the American people.

The Republican budget, as I have said before, is premised on the idea that America is poor and broke, that our best days are behind us, and that we have no choice but to slash investment required in order to keep our middle class strong. I totally disagree. Many Americans are hurting because of the struggling economy, but the United States overall remains a tremendously wealthy and resourceful nation. Quite frankly, we are the richest Nation on the face of the Earth. Even further, we are the richest Nation in human history. We have the highest per capita income in America of any major nation. So one has to ask the question, if we are so rich, why are we so poor? The question is not the lack of money. It is not the lack of wealth. It is because the system is broken. We have a system malfunction in this country, and we have to right that system. Because we are an optimistic, forward- looking people, we can do it. We can work together, and we can meet any challenge.

But we expect the government to be on our side--not holding us back, not dragging us down, not shorting our futures, not telling people who are low income or recent immigrants to this country or kids who do not have a good start in life that, sorry, we cannot give you a world-class quality education, we cannot afford to have the best teachers, we cannot afford to have good schools for you.

If you happen to be wealthy and live in a wealthy area that has high property taxes and you have a good school and you have good teachers, good for you. But if by happenstance of birth you are born to a family who does not have any money and maybe your parents never went to college--maybe, as I said, they are new immigrants to this country; maybe they do not speak English that well--if you are in a poor urban area or a poor rural area and you have low-quality schools, low-quality teachers, chances are you never had any early learning available to you. So when you started kindergarten, you were already way behind those kids in that affluent school in high-income areas.

Is that what we are about? Is that what we are trying to say, that we are going to have this kind of almost class warfare, that if you are born wealthy and stuff, you have it made but if you are born poor, forget about it when it comes to education? That is what the Republican budget says. We are not going to have quality public education for our kids.

As I said, this does not reflect the values of the American people. We want to make sure our public education system is good for all children, that they all have the best qualified teachers, that they have good schools, good facilities, the latest technology, that they are challenged to do their best, and that they know if they do their best and if they study hard and they get good grades, they will be able to go to college and not have a mountain of debt hanging over their heads when they graduate.

We have done great things as a society, things we have had to do together, which we could not do as individuals, such as building an interstate highway system, a rail system, mapping the human genome, and, again, creating world-class universities. We have done this. We have done this working together, as something we can do together as government that we cannot do as individuals.

Through our government, we come together to provide a ladder of opportunity to give every citizen a shot at the American dream--a ladder of opportunity that includes Pell grants, the GI bill, job training, early learning, and, yes, world-class schools.

I am convinced the great majority of Americans share this positive vision. Again, we are determined to bring deficits under control. But we cannot eat our seed corn. We have to make smart investments in education, and we refuse to be dragged backward into a winner-take-all society, where the privileged and the powerful seize an even greater share of the wealth, even as our schools are crumbling and our middle class is struggling and declining.

For nearly half a century, robust Federal investments in quality public schools and access to higher education have been a critical pillar undergirding the American middle class. The Republican budget will take a jack hammer to that pillar. This, I believe, is a grave mistake. The middle class is the backbone of our Nation. It is time our leaders show the backbone to defend it.

Amendment No. 390

Madam President, I would like to take this opportunity also to strongly oppose the amendment offered by the Senator from Maine. If passed, the amendment would impose severe and unnecessary burdens on agencies charged with protecting the American people and would severely weaken our vital health and safety protections.

My Republican colleagues have tried hard to make the word ``regulation'' into a bad word. They have created an absurd caricature: the nameless bureaucrat arbitrarily imposing random rules and regulations on businesses, and their sole purpose is making sure the business fails. That is ridiculous.

Most Americans understand this is grossly distorted. The truth is, the amendment offered by the Senator from Maine, Ms. Snowe, is not about the government working more efficiently--a goal we all share--it is about using the sort of feel-good slogan of ``regulatory reform'' as cover for an effort to paralyze the ability of the government to enforce vital health and safety protections.

In effect, the Snowe amendment ought to be called the ``buyer beware'' amendment. Go back to the days when the snake oil salesman could sell you anything and you took it at your own risk, where we did not have safe drug laws and food safety laws and things such as that to protect people. It was just a buyer beware society. Do we want to go back to that?

I believe the American people want clean air and clean water and to know they are not adulterated. The Snowe amendment would weaken environmental protection.

I believe the American people want to make sure their children's toys are safe, that they are not loaded with mercury and other elements that will destroy their health. The Snowe amendment would mean weaker protection of toys and other consumer products.

I believe the American people want workers to come home safely at the

end of the day. The Snowe amendment would mean more injuries and deaths in mines and other hazardous workplaces.

I believe the American people want the food they eat to be safe and untainted. The Snowe amendment could mean we cannot enact implementing regulations for our recent bipartisan food safety bill, which we just passed last year--bipartisan. But when you pass a bill, obviously, the Food and Drug Administration is going to have to issue regulations. Well, the Snowe amendment would severely restrict that. Again, you would be playing Russian roulette with the food you eat. Maybe it is safe; maybe it is not--buyer beware.

I believe, in the wake of the financial meltdown of 2008, which almost caused another Great Depression, the American people want oversight and regulation of banks and other financial institutions. The Snowe amendment, again, could mean banks would remain free to do the same reckless, predatory practices that nearly wrecked our economy.

There are already important checks on regulatory authority. The law already requires agencies to perform comprehensive assessments of the impact of regulations on businesses and local government. There is an extensive notice and comment period under the Administrative Procedures Act, where those impacted by potential rules--including small businesses--are given an important say in regulation. Agencies already engage in regulatory flexibility analysis to ensure that their oversight does not needlessly overburden small businesses.

In contrast, the aim of the Snowe amendment is to impose additional hurdles to dramatically slow down the issuance of critically needed rules and, in many cases, stop the rulemaking process altogether. For example, the Snowe amendment would require an analysis of ``indirect'' impact on small businesses--``indirect'' impact, whatever that means. Well, let me cite perhaps an example.

Instead of the Mine Safety Health Administration spending its resources protecting our miners, the amendment could require the agency to determine whether a new mine safety standard indirectly harms, say, a small paper company that supplies paper to the mine's corporate offices. This is a ridiculous waste of resources and time. So we do not even know what the ``indirect'' impact means. That could mean almost anything.

Likewise, the amendment would permit businesses to sue to block a rule even before it is finalized. In other words, businesses could seek to litigate a proposed rule. I often hear my Republican colleagues speak against activist judges. I can think of few things more activist than for unelected judges to review a rule even prior to the agency performing the lengthy notice and comment process to finalize a rule. It already takes years for agencies to promulgate health and safety rules. This amendment would exacerbate the problem and further clog up the court system. Think about all the court cases that would be filed just on a proposed rule, before it even goes to the comment period, before it is even finalized.

Moreover, the bill requires an agency to review the impact of all-- all--its current rules on small businesses to determine if a rule must be modified, rescinded or continued unchanged. In other words, rather than addressing new problems and implementing new acts of Congress, an agency would need to spend all its time reviewing past, settled regulations, some of which may have been in effect for the last 50 years.

To its credit, the Obama administration already is conducting a comprehensive, rigorous review of all rules in order to see which ones should be repealed, modified or kept in place. We should let this careful review take place before implementing severe constraints on agency rulemaking.

So the Snowe amendment would make government less responsive. It seeks to cripple the government's ability to make sensible lifesaving regulations.

Again, it ought to be titled the ``buyer beware'' amendment. If you like living in that kind of a society, I suggest you go to some Third World country, where you do not know what you eat or what you drink or whether the air you breathe and the water you consume is safe and healthy. If that is the kind of America you want, you should support the Snowe amendment. But if you want an America where our kids are safe from dangerous toys, where you know the food you eat is going to be safe and the water you drink and the air you breathe, where you know there are safety rules in place so you are not going to get unduly injured or harmed at the workplace, if you believe this is the kind of America that operates better and is more functionally productive than a buyer beware kind of society, then I suggest you should oppose the Snowe amendment.

Again, I urge my colleagues to oppose the Snowe amendment as ill- advised. Again, it is a part of a bill that has never gone through the committee hearing process. If nothing else, it ought to go through committee, have hearings, and let's see if it has any support at all out there before we bring it to the floor of the Senate. I urge my colleagues to defeat the Snowe amendment.

I yield the floor.

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

Madam President, I ask unanimous consent to speak as one of the opponents of the amendment.

Madam President, I rise today to express my strong opposition to the Tester-Corker amendment No. 392 to the Economic Development Revitalization Act.

The interchange fee debate is not a new one for the Senate. This is an old discussion with both sides--financial institutions and retailers--bringing their perspectives to the table.

I should note that I am a former small businessman and retailer. My wife and I owned and operated Enzi Shoes, a family retail shoestore in Wyoming and Montana, for over 25 years.

Retail stores have been clamoring for a change for years and have always felt ignored by the credit card and the big bank card companies. Stores with small-priced items are forced to allow a sale to be put on a debit or credit card. While some stores post signs requiring a minimum purchase, they are violating their service contract. If the fees were merely a percentage of the sale rather than a minimum amount or a percentage, whichever is larger, much of the argument would be gone. Without the percentage fees, small businesses have no leverage for negotiation.

Soon vending machines will allow you to kind of point your cell phone at the vending machine and click, and you will get your snack or your soda, and it will be billed to your debit card. But if the cost of making that purchase eats up the profits on the sale plus some money out of the vending machine owner's own pocket every time someone buys a soda or snack, will the machines be available? No. You can't be in business if you lose money on every sale.

Now, the vender has an option: They can charge as though every sale is a debit card sale and increase the cost of the item to cover whatever cost the debit card company puts on your purchase. What you have right now is this hidden fee that goes to a card company. The card company shares that fee with participating banks. Banks are now saying that if they lose that fee, they will have to charge their customers in other ways. I am told the average bank will have to make up about $150,000 in hidden fees they are now receiving that customers have been paying on their purchases and don't know about them. Are hidden fees fair? I fight them every chance I get.

According to the Wyoming Retail Federation, retail stores, hotels, restaurants, and small businesses in Wyoming consistently report that credit-debit card fees have tripled in the last 10 years. These fees have become a major cost, now surpassing other traditional costs of doing business. This is a small business issue and small businesses particularly because they do not have the leverage to do any negotiating. Incidentally, in this case, neither do the big companies. But the small businesses are paying two or three or four times, and sometimes more, for credit and debit charges.

When I recently traveled to Wyoming, a businessman compared his expenses in the last 5 years to explain the effects of interchange fees on his business. Gross sales between 2005 and 2010 were $5 million and $5.5 million a year. Percentage of sales made on credit-debit cards was 15 percent in 2005 and 37 percent in 2010. Sales in the last 5 years increased 10 percent and credit card

fees increased over 100 percent. Credit and debit card fees as a percentage of total sales were three-tenths of 1 percent in 2005 and 1 percent in 2010. So the fees tripled in just 5 years. The retailer has no control over that. It is a monopoly. When the bank raises fees, if you know about it, you can change banks. The debit card business is like a monopoly, so when the debit card companies increase their fees, the only alternative is not to accept the cards as payment. But the cards have become a way of life, and the companies know it.

The profit margin of business is too narrow to sustain these increases. This is why defeating the Tester-Corker amendment means saving jobs in my home State of Wyoming and around the Nation. I believe increases in interchange fees are cutting into the resources that could be used to provide more jobs.

During the financial regulatory reform debate last year, Senator Durbin offered an amendment that tasked the Federal Reserve--the Fed-- with studying the actual cost of debit card interchange costs versus fees being charged. I voted in favor of the Durbin amendment, hoping it would create a dialog and a commonsense compromise on this issue. I was trying to force this dialog clear back in my shoe-selling days. Card companies didn't pay any attention. I have tried ever since becoming a Senator. I have been ignored.

The Durbin amendment is the only thing that has gotten the debit card-big banks' attention. But did they try to resolve it with the stores--the stores that were generating the sales and therefore collecting their revenue? Again, a resounding no. They haven't met with them at all. They have spent a fortune trying to convince the public that their monopoly is OK and they shouldn't have to do anything about it; that they have always been right, they are still right, they are going to be right, and they do not have to talk to their customers, which are the stores.

I encouraged the banks to listen and to negotiate, but they chose to advertise and message to make stores look like the bad guys. They have spent a small fortune advertising and messaging. One day, on my way to work, I came by a place where they were giving out insulated coffee cups to give this message that the big banks were going to be put out of business by this amendment.

As we all know too well, dialog is occurring in the Halls of Congress, but that isn't going to rectify the problem. I agree that government should not determine a set price on fees. I will say that again. I agree the government should not determine a set price on fees. But if a huge segment of the economy makes a case for redress, then it will likely fall under what I call the probable legislation rule No. 3: If it is worth reacting to, it is worth overreacting. It is not a good way to legislate, but unfortunately it happens a lot in Washington, and it may have happened in this case. I have worked for years to bring retailers and the big banks to the table to discuss and negotiate interchange fees and make the system work better for both parties. It hasn't happened, and that is when we get to this reaction time.

Since passage of the bill last July, there has been ample time for the banks and retailers to work out a solution. Dialog between the financial institutions and the retailers has to occur in order to find an immediate and a real solution to this problem.

The interchange fee provision is an important issue that deserves the full attention and consideration of both intended and unintended consequences, but our Nation's retailers and small businesses can't afford continued delays and studies because this kicking the can down the road is to keep things the way they were, and it is what we will be getting today if the amendment passes. Oh yes, it looks as though there is going to be some interaction there. If the big banks win today, the customers of stores lose.

Following the passage of the Durbin amendment, S. 575 was introduced this year by Senators Tester and Corker as a stand-alone bill to delay implementation of the Federal Reserve rules until the impact of those fees could be studied for another 2 years. That is the original bill where this amendment comes from. A similar House bill proposed to delay-study the debit card interchange fee rule for 1 year. Now, searching for votes, Senators Tester and Corker have changed their amendment, so what we will be voting on today is a study and a year of kicking the can down the road. But even though it has been changed, it is still wrong.

My colleagues knew I was not willing to support the original 2-year delay which would effectively bury progress made on the issue. A 2-year study was not just kicking the can down the road; it was making an indefinite delay on any changes and prohibiting dialog between parties.

I commend Senators Tester, Corker, Crapo, and others for working to decrease the study timeline from 2 years to 12 months. As you have heard during this debate, the Tester-Corker amendment would allow for 6 months of studying the interchange fees, plus an additional 6 months for the Treasury and Federal Reserve to draft a final rule. While this is a step forward in the resolution, more needs to be done to accelerate this process. Another full year without a solution is too long for merchants and retailers.

There is another problem too. That is the Fed will still be making the rule. We have to realize that banks work with the Fed all the time, so banks understand the Fed and the Fed understands the banks. Retailers don't work with the Fed. The Fed does not check on the retailers. So how do you think the rule the Fed will write will come out if we kick the can down the road another year? I think the banks will have a big advantage.

What we need is for the banks to listen to their customers, the retailers, and come up with a workable solution. The Fed isn't the right place for that decision. The Fed just made a decision that the banks decided they didn't like. Quite frankly, for some of the small banks, there is a problem too because what was allowed for small banks to give them an edge isn't ever going to happen. People will shop where it is cheapest, which will be the big banks. So I think the Fed did get it wrong, and I don't think the banks will get it right unless there is something that is real to them.

On July 21, the current rule will go into effect. On July 21, they will finally feel that it is real, and they ought to sit down with their customers, the retailers, and get it figured out. I don't think it is that tough. I know where the changes were that I would have liked to have seen, and I didn't represent the whole gamut, but there are a few associations that would be viable to work this out. It doesn't need to be done through legislation. But if today we pass the Tester-Corker amendment, there won't be any incentive for them to do anything for at least another year because the problem still won't be real.

The banks don't think there is a problem. The retailers know there is a problem, and the retailers' customers are beginning to understand there is a problem. I just saw a survey from Montana, and 75 percent of the people are opposed to the swipe fees that are currently in place-- 75 percent. America is figuring things out faster than Congress is, and we have to be with the people. We have to take care of the problems they see, especially when it is that huge a majority. I don't like doing things based on polls, but I do like polls to give me an indication.

I go back to Wyoming almost every weekend, and I travel to a different part of the State every weekend and talk to the real people; I just don't read it in the papers or read the studies. I can tell you that 75 percent is probably just about right. I think it might be just slightly higher than that in Wyoming.

The banks and the retailers should get together and come up with a rule that will work for both of them but not one that maintains a monopoly. When you sign on to one of these credit card agreements--and you have to do one of those in order to be able to accept them and have the money work through the system back to you--you are not given any options. There isn't anything you can shop around for because all the agreements are the same. If you sign one of those agreements, you have to be willing to accept it no matter what the size of the purchase.

Now, if you are selling a soda for $1 and you are paying 44 cents, you know the soda company isn't making enough to cover the 44 cents, so they have to

raise their price, which gets passed on to the customer. They have to raise the price so that it covers the credit card, but it also has to cover the other sales because there is no way for them to distinguish one from the other. They can't charge more for a credit card sale than a debit card sale, and they shouldn't. So they build in a hidden fee that you don't know you are paying. That fee is a huge fee, and it takes away some of the profits on the small sales. That is one of the primary areas that is driving this whole issue. There are other areas, too, but that is the simplest one that could be figured out.

Both sides on this issue need to have a hand in the negotiating. Defeating this amendment gives them both a hand, and that is why I strongly believe two things need to occur to fix this problem. No. 1, any study should not be longer than 6 months total study time and drafting of the rule and, No. 2, banks and credit unions must come to the table with retailers and merchants to define some middle ground. It would be more workable if bankers and retailers sat down and negotiated an agreement. They don't need a study. The retailers know what the problem is. The banks know the problem better than the retailers. So all they have to do is skip the study, sit down, and work it out. I think it could be worked out before July 21, although a deadline is always good. So we really need to defeat that.

It is a tough issue for small business owners, merchants, and retailers because many of our community lenders have come to rely on this interchange income. No good comes from pitting small businesses against lenders in Wyoming or otherwise, especially not in this economy. Bankers already know what changes need to be made. If they had put more effort into forcing bank card fees to be more reasonable, the situation could have been solved years ago. Clearly, it could have been when I was back in the shoe business. I can tell you, I am pretty discouraged that now that I am in the Senate they still are not listening.

This bill has made them listen. So no more delays should occur. Interchange fee reform was overwhelmingly approved by Congress last year. U.S. consumers do not need additional studies to tell them they already pay the highest swipe fees in the world. Delaying these reforms will delay urgently needed relief for American businesses and consumers, relief that cannot wait longer during this fragile economic recovery.

Today I ask my colleagues to side with the stores and their customers; otherwise, we will have just done another bailout for big banks.

I yield the floor and reserve the remainder of the time.