Date: 1983-07-29
Speaker: ST GERMAIN (democrat)
Chamber: H

Mr. Chairman. debate on this bill began last Friday on the rule. with general debate occurring on Monday. followed by over 6 hours under the 5minute rule on Tuesday. From the beginning we knew this bill would be controversial. and this reason. I and my committee colleagues have encouraged an open debate with ample opportunity for Members to voice their doubts and misgivings in an effort to assure a thorough amendatory process. Taking into account the legitimate concerns voiced by a number of Members on both sides of the aisle concerning this legislation. the ranking minority member of the Banking Committee. CHALMERS WYLIE. and I are offering a compromise perfecting amendment supported by the House leadership and the administration. Our amendment in summarized form responds to the concerns expressed during extensive debate to this point as follows: First. The amendment provides for controls over the release of U.S. funds to the IMF by requiring that the $2.61 billion requested by the administration for increases in the general agreements to borrow (GAB) funds can only be released after the Secretary of the Treasury has certified the necessity for supplemental resource to forestall an impairment of the international monetary system and that the IMF has explored all other means of financing. Second. Responding to the legitimate concerns related to a possible diverting of resources from U.S. domestic needs. we incorporated the perfecting amendments adopted by the House on Tuesday as well as a number of other proposals to title III which address this concern. In addition. the amendment changes the Bretton Woods Agreement Act to establish without doubt the priority of the health of the U.S. economy and requires the Federal Reserve. Comptroller of the Currency. and FDIC. to identify excessive foreign lending. prevent further excess foreign lending. encourage domestic lending. and to require the Treasury Secretary and Federal Reserve Chairman to implement the Bretton Woods Act in such a way that U.S. economic wellbeing has the highest priority. Third. An antibailout provision is provided to instruct the U.S. Executive Director to. in the words of the amendment: To oppose and vote against any fund drawing by. a member country where. In his judgment. the Fund resources would be drawn principally for the purpose of repaying loans which have been Imprudently made by banking institutions to the member country. Fourth. The concerns expressed that repayment requirements am too stringent thereby cutting off any Import capability is met by requiring the U.S. Executive Director to: Work to insure that the Fund encourages borrowing countries and banking Institutions to negotiate. where appropriate. a rescheddling of debt which is consistent with safe and sound bankIng practices and the countrys ability to pay. - . Fifth. An absolute prohibition of upfront rescheduling fees by U.S. banks is contained in the amendment except for administrative fees covering actual costs. Sixth. A limitation is placed upon further lending by U.S. banks which have engaged In excessive loans to U.S. countries. Excessive loans are identified as those which exceed a banks primary capital. I ask my colleagues on both sides of the aisle to review carefully this amendment and give due weight to the need for compromise and enactment of this legislation. My colleagues. all I can say to you Is that a great deal of work was put into this compromise. There are those who will continue to criticise it. but very frankly. it would be impossible to satisfy everyones objections to this legislation. because the minute you satisfy the objection of one group. you then find that you have another group that is upset with that which you have done to satisfy the objections of the other group. So. we really and truly worked in a bipartisan mannerand I reiterate bipartisanwith the administration. with the Secretary of the Treasury. with the Federal Reserve Board. and with the approbation. and approval and assistance of the White House to come up with this compromise. The time Is short. There are very bad messages going out into the international economic community. We all have a very deep responsibility here. To those who oppose the legislation. again I say. I respect you. but let us take this legislation up this morning. let us address it in a manner that is not dilatory but addresses the amendments that are up before us for consideration. and let us come to a conclusion on this legislation and. I hope. a conclusion. as a result of this compromise. that will meet the favor of the House through adoption of the legislation.