Date: 1981-12-08
Speaker: ROBERT C. BYRD (democrat)
Chamber: S

I thank the Chair. .Mr. President. I rise in opposition to the amendment proposed by Senators BAKER. WEICKER. and JEPSEN. The sole difference between their proposal and mine is that the Republican alternative will send "a much weaker mnessage to the President than will the legislative language of my amendment. We must decide today if we want to give the small businessmen of this country the assurance that their concerns will be heard on the Federal Reserve Board. or if wo will only offer them another weak reed oi hope. it has been said that my amendment is Inappropriate because it has not been thoroughly considered by the Banking Committee. which has jurisdiction in these matters. In ordinary times I would agree with that. Unfortunately. these are not ordinary times. The small business community has come under enormous pressure from high interest rates. and its voice. the small businessmans voice. must be heard. Reports in the Wall Street Journal indicate that the President is within 10 days of making his decision about who will fill Governor Schwaltz position next January. The Banking Committee has had more than 1 year since the last Federal Reserve nominee wvas approved. and no action was taken until yesterday when highly preliminary testimony was heard. The time to act has come. Let us look. for a moment. at a few of the standard objections to my amendment. It Is said that the statutory language ties the hands of the President. To that charge I can only respond. yes. It does. That is exactly the difference between my amendment and the numerous resolutions that urge the President to appoint a small business representative to the Board of Governors. My amendment will make a point that the President cannot Ignore when selecting his nominee to fill the vacancy left by Governor Schultz. The small business community has never received a fair degree of representation on the Board of Governors. and my amendment would be the first step toward redressing this longlived oversight. The issue could not be more clearly drawn. Do we assure small business representation on the Federal Reserve Board or do we not? That Is the question each of us must answer by the vote here today. If Senators who oppose statutory language believe the President is going to appoint a small business representative to the Board. then they have nothing to lose by supporting this amendment. However. if they fear that the President will make his choice from the banking or economic theorist community then my amendment is the only way to assure that a small business representative is chosen. The choice is clftr: Do you favor or do you not favor small business representation on the Federal Reserve Board? Others have said that by specifying an appointment to the Federal Reserve Board we are compromising the independence of the Fed. Nothing could be further from the truth. This amendment does nothing to compromise the~ independence of the Federal Reserve Board. It does not make one direction to thenm regarding the money supply. credit conditions. or operating procedures. It does not address any decision that lies within the powers of the Federal Reserve Board. The Issue here is not the independence of the Federal Reserve Board. but whether we will finally bring the Bloard of Governors into compliance with the intent of Congress when it creat ed the Fed. The original act specified that fair representation of financial. agricultural. industrial. and commercial interests be considered when a Presidential appointment to the Board of Governors Is made. my amendment seeks to assure that this longstanding provision be made a reality. and that the small business community is finally represented on the Board. The Fed will still be able to take any actions it sees as necessary to help our economy. but if my amendment passes. the voice of small business will be added to the Wall Street chorus now on the Board. Still others have said that If we specify small business representation on the Federal Reserve Board. we will soon he Apecifying seats for other special interest groups. This is a false issue. Small business is not a special Interest within our economy. it is the largest part. and the backbone of our Nations economy. .Small business accounts for 53 percent bf our GNP and 70 percent of all new jobs. We are not talking about a special interest. we are talking about representIng the concerns of the overwhelming majority of Americans. To compare this vast community with those groups we normally refer to as special Interests is to do a great disservice to most small business people and most working people in this country. This Congress is not disposed to specify the complete makeup of the Board. but I do believe we should demand that the original intent of the Federal Reserve Act. which called for fair representation of various economic interests. be fulfilled and that a broader range of interests than banking and economics be represented on the Board. At the end. we com6 to the fundamental question: Why not pass a resolution rather than legislative language? The answer is simple. A resolution will send an entirely different message than would legislative language. That is my fundamental concern. We need to send the strongest possible message. and that message will only come through clearly with the adoption of my amendment. which is not hortatory in nature but which constitutes binding legislation. When we vote. let us ask ourselves do we want to assure that Main Street America is represented on the Board. or do we want to send a weak signal that the Senate is mildly concerned about this problem? It is time that we stiffen our spines and send the strongest Possible message to the President. That message is only sent by the amendment which I have offered. A sense of the Senate would be recognized for what it is: A failure of will on the part of this Congress. A failure to stand for small business when it Is most in need. I urge my colleagues to send the strong message. not the weak message. When the time has expired I will move to table the amendment In the second degree. and I urge Senators to vote to table that amendment. If the tabling motion should succeed. I urge Senators to vote In support of my amendment. If the tabling motion fais. I hope that the Senate will vote down the amendment in the second degree and then vote up my amendment in the first degree. I reserve the remainder of my time.