THIS SEARCH     THIS DOCUMENT     THIS CR ISSUE     GO TO
Next Hit        Forward           Next Document     New CR Search
Prev Hit        Back              Prev Document     HomePage
Hit List        Best Sections     Daily Digest      Help
                Doc Contents      

Sec. 18. Preemption. Rewrites paragraph 12(e)(2) of the CEA for clarity and to conform with changes made in the bill. Re-states the current provisions that the CEA supercedes and preempts other laws in the case of transactions conducted on a registered entity or subject to regulation by the CFTC (even if outside the United States), and adds that in the case of excluded electronic trading facilities, and any agreements, contracts or transactions that are excluded or covered by a 4(c)

[Page: S4827]  GPO's PDF

   Sec. 19. Predispute Resolution Agreements for Institutional Customers. Amends section 14 of the CEA to clarify that futures commission merchants, as a condition of doing business, may require customers, that are eligible contract participants, to waive their right to file a reparations claim with the CFTC.

   Sec. 20. Consideration of Costs and Benefits and Antitrust Laws. Amends section 15 of the CEA to add a new subsection (a) requiring the CFTC, before promulgating regulations and issuing orders, to consider the costs and benefits of their action. This does not apply to orders associated with an adjudicatory or investigative process, emergency actions or findings of fact regarding compliance with CFTC rules.

   Sec. 21. Contract Enforcement Between Eligible Counterparties. Amends section 22 of the CEA to provide a safe harbor so that transactions will not be voidable based solely on the failure of the transaction to comply with the terms or conditions of an exclusion or exemption from the Act or CFTC regulations.

   Sec. 22. Legal Certainty for Swaps. Provides that the SEC does not have jurisdiction over swap agreements. Places a one year moratorium on banks being able to market swaps to the retail public. Requests the President's Working Group to conduct a study on the regulatory treatment of swaps offered to retail customers.

   Sec. 23. Technical and Conforming Amendments. Makes technical and conforming amendments throughout the CEA to reflect changes made by the bill.

   Sec. 24. Effective Date. The Act takes effect on the date of enactment, except section 8 (dealing with futures on securities), which takes effect one year after enactment.

   Mr. GRAMM. Mr. President, today I join with Senator LUGAR, chairman of the Senate Agriculture Committee, to introduce the Commodity Futures Modernization Act of 2000. The formal purpose of this legislation is to reauthorize the Commodity Exchange Act, the legal authority for the Commodity Futures Trading Commission. As important as that is, this legislation does far more.

   This is a landmark bill, that addresses four chief goals that Senator LUGAR and I set out to achieve when we first began discussing this legislation. First of all, this bill would repeal the so-called Shad-Johnson Accord, the 18-year-old temporary prohibition on the trading of futures based on individual stocks. Second, the bill eliminates the legal uncertainly that today hangs as an ominous cloud over the $7 trillion financial swaps markets. Third, the bill addresses the need to harmonize the treatment of margins among the futures, stock, and options markets. Fourth, the bill provides important and necessary regulatory relief to the futures and securities markets.

   One of the most notable aspects of this bill is that it brings together the chairmen of the two committees with jurisdiction over these issues, the Agriculture Committee and the Banking Committee. To start out with such cooperation speaks well, I believe, for the prospects for this legislation. While the Commodity Exchange Act is clearly within the jurisdiction of the Agriculture Committee, stocks, options, and swaps are within the jurisdiction of the Banking Committee.

   The next step for this bill will be joint hearings of our two committees to consider it. Few bills are in a perfected form when first introduced, and I fully expect that additional changes will be made to this one before it becomes law. For example, I hope to see additional measures of regulatory relief for the securities markets included.

   But this bill is a fine beginning, introduced in the best way. We bring together two committees that could choose to argue over turf but instead are choosing to cooperate to make changes in law that are needed to ensure that our financial market places continue to lead the world. At the same time, we will be providing the widest choice of investment opportunities for American businesses and families.

   By Mr. MOYNIHAN (for himself, Mr. KERRY, Mr. ROCKEFELLER, Ms. SNOWE, Mr. ALLARD, Mr. BAUCUS, Mr. BREAUX, Mr. BROWNBACK, Mr. BRYAN, Mr. BUNNING, Mr. BURNS, Mr. DASCHLE, Mr. HOLLINGS, Mr. HUTCHINSON, Mr. JOHNSON, Mr. KENNEDY, Mr. KERREY, Ms. LANDRIEU, Mrs. LINCOLN, Ms. MIKULSKI, Mr. REID, Mr. ROBB, Mr. ROBERTS, Mr. SCHUMER, Mr. THURMOND, Mr. ENZI, Mrs. BOXER, and Mr. DEWINE):

   S. 2698. A bill to amend the Internal Revenue Code of 1986 to provide an incentive to ensure that all Americans gain timely and equitable access to the Internet over current and future generations of broadband c apability; to the Committee on Finance.

   BROADBAND I NTERNET ACCESS ACT OF 2000

   Mr. MOYNIHAN. Mr. President, today, joined by my colleagues Senators KERRY, ROCKEFELLER, SNOWE, ALLARD, BAUCUS, BREAUX, BROWNBACK, BRYAN, BUNNING, BURNS, DASCHLE, DURBIN, ENZI, HOLLINGS, HUTCHINSON, JOHNSON, KENNEDY, KERREY, LANDRIEU, LINCOLN, MIKULSKI, REID, ROBB, ROBERTS, SCHUMER, and THURMOND, I am introducing the Broadband I nternet Access Act of 2000. This legislation provides a tax incentive to stimulate rapid deployment o f high-speed communication services to residential, rural, and low-income areas.

   A term of art often used for high-speed communication service is ``broadband.' ' The term is a remnant from the era of analog systems. It refers to the size of spectral bandwidth over which signals can be transmitted. Even though it is not essential to have wide spectra in the digital world to transmit vast amounts of data, ``broadband'' r emains in our digital society's lexicon for high-speed communication or throughput.

   In common use, broadband c onnotes fast Internet access, and that is certainly part of the goal of this legislation. The grander goal, however, extends beyond simply expediting traditional Internet use. It is to deliver, in the near future, a wide array of voice, video, and data communication services, at extremely fast speeds, to all Americans.

   The Broadband I nternet Access Act of 2000 provides graduated tax credits for deployment o f high-speed communications to residential and rural communities. It gives a 10-percent credit for the deployment o f at least 1.5 million bits per second downstream and 200,000 bits per second upstream to all subscribers--residential, business, and institutions--in rural and low income areas. This is essentially ``current generation'' broadband. The bill gives a 20-percent credit for the deployment o f at least 22 million bits per second downstream and 10 million bits per second upstream to all subscribers in rural and low income areas, and to all residential customers in other areas. This is what we are calling ``next generation'' broadband.

   The bill does not dictate the technological means by which these broadband s ervices are to be delivered. Today, the possibilities include telephone lines, cable modems, fiber optics, terrestrial wireless, and satellite wireless. In the future there may be others. Whether high-speed communications are delivered by electrons or by photons, with wires or without wires, by copper or by glass, by terrestrial or by extraterrestrial means, is immaterial. With a temporary tax credit, it is economically feasible to push national communication capabilities forward by ten or perhaps twenty years. The bill permits a variety of technological approaches to make under-served areas more economically attractive to broadband p roviders. Yesterday we had electronics. Today we have photonics. Tomorrow we will have some ``future-onics.''

   Mr. President, as I stand before you today, the streets of Washington, D.C. and of many other major cities in this country are being torn-up to lay cables for high-speed communication. Line-of-sight communication ``dishes'' are being installed on office buildings permitting business-to-business voice, video, and data transmissions. The problem is, market forces are driving deployment o f high-speed communication capabilities almost exclusively to urban businesses and wealthy households. Low-income families, exurban communities, rural businesses, and rural families are relegated to the back of the queue. The bill gives private industry economic incentives to accelerate high-speed communication capabilities to Americans who are at the end-of-the-line.

   Why is this important? Let me offer examples of this technology's power and importance. I start with two historical cases.

   During the 1950's the National Institute of Mental Health funded a 1,278-

[Page: S4828]  GPO's PDF

   At about the same time, radiologists in Montreal had a coaxial cable laid between two hospitals three miles apart, thus connecting them for audio and video communications. Doctors were regularly transmitting radiographic images to each other to consult on difficult cases and to conduct educational conferences.

   As a result of these two projects, patients were treated by physicians who were, in some cases, hundreds of miles away. The medical profession was able to share information and ideas, which improved healthcare in this country and Canada.

   Unfortunately, such ``telemedicine'' links are very few, even though our ability to transmit data has increased. Why? Because there is no nationwide high-speed data-transfer infrastructure. Instead, the standard business Internet speed in rural areas is 56,000 bits per second. What can be done at that speed? Printed matter can be sent and received reasonably quickly. But photographs or graphics, require long waits, and then often with poor image quality. More advanced uses, such as video conferencing, are out of the question. At faster Internet speeds of, say, 200,000 to 300,000 bits per second, information can be sent much faster. Photographs and graphics leap to the screen, instead of crawling. Video conferencing also is possible, although jittery images and low image resolution make it impractical. Music and movies can be downloaded slowly to a compact disk.

   At higher data transfer speeds--about 1.5 million bits per second--the amount and quality of information that can be transmitted becomes quite good. Very good video conferencing is possible. Two or more people in different places can see and talk to each other as if in the same room, at a crisp image resolution and without image jitter.

   And at even higher speeds, extraordinarily rich images of movement, color, and detail can be transmitted as if one were looking at them in person. Complex medical images can be sent and received. At twenty million bits per second, a digitized mammography image can be transmitted in about fifteen seconds, and a standard chest x-ray in about four seconds.

   Twenty million bits per second is about 360 times faster than the fastest speeds available on a conventional modem attached to a Plain Old Telephone Service, or, as I am told, POTS. Is it really possible to do this? Indeed, it is. The technology exists now. Over ordinary copper wire, some of our communication companies are now offering data speeds of 26 million bits per second.

   Imagine the tremendous personal and economic benefits our nation will reap with universal high-speed communication access, including telemedicine; telecommuting; distance learning at all education levels; electronic commerce in low-income and rural communities; digital photography; and entertainment video. As a result, we will enjoy greater educational opportunities, greater geographic freedom, increased wealth in low-income areas, and even decreased urban congestion.

   So if the benefits are so great and the capability exists, why are these technologies not widely available? Simple economics. It is much more lucrative to provide services to business customers. Although a few affluent individuals in urban areas have high speed Internet access, the great majority of Americans are limited to extremely slow communication or to none at all.

   That is why it is appropriate for government to step in at this time and provide an incentive to stimulate deployment o f high-speed communication service to residential areas and small businesses, especially in rural and low-income areas of the country. Our country has a proud history of supporting critical services in rural and under-served communities.

   Three major examples are utilities, interstate highways, and the airline industries.

   The Rural Utilities Service is a federal credit agency within the Department of Agriculture that helps rural areas finance electric, telecommunications, water, and waste water projects. Its lending creates public-private partnerships to finance the construction of infrastructure in rural areas. Working in partnership with rural telephone cooperatives and companies, the Department of Agriculture helped boost the number of rural Americans with telephone service from 38 percent in 1950 to more than 95 percent in 1999.

   The federal government funded 90 to 100 percent of the cost of building the interstate highway system. The Federal Aid Highway Act of 1956 initiated a nationwide program that aimed to be completed within 20 years. The bulk of the program was completed within this time period, although full implementation was not achieved until the early 1990s.

   In the 1930s, the airline industry--much like today's Internet start-ups--was operating at a loss. Believing airline service to be both unique and necessary, the federal government stepped-in with an airmail subsidy in 1938, and this federal funding made the industry instantly profitable. The airline industry then flourished, and the subsidy was removed in the mid 1950s.

   In a 1979 speech titled, ``Technology and Human Freedom,'' I stated, ``I believe that government can and should seek to advance technology--as a condition of social progress.'' I still believe that. In 1979, I went on to say, ``In my view, only a person of what St. Augustine would have termed `indomitable ignorance' could deny that technology has greatly enhanced human freedom. . . . Freedom is choice, and technology vastly enhances choice. . . . The relation between technology and democracy is intimate. . . . Experimentation, variety, optimism: these are the ingredients of both technology and democracy.''

   In 1978, the late Mancur Olson, an esteemed economist, cautioned that the very liberty of societies such as ours may be the source of developments that make innovation considerably more difficult. We should guard against the prospect of our government retarding technology as Professor Olson hypothesized. The bill I introduce today encourages technology, and extends its range to those residential and business areas it otherwise would not reach until much later.

   We need this legislation now to maintain our technological leadership. As the press has recently reported, Sweden, Japan, Singapore, and Canada are deploying broadband a t levels higher than those called for in this bill. We cannot afford to fall behind in this critical area. History indicates that, if we do not act aggressively, it will take a very long time to deploy broadband s ervices on a widespread basis. The first regular, sustained commercial telephone services were offered in 1876, but it took more than 90 years to make the service available to 90 percent of residences in the United States. It would be deplorable if it takes even half as long to bring existing broadband t echnology to the same number of Americans.

   If the Internet is the information superhighway, broadband c ommunication is the information super sonic transport. I want to encourage the communications industry to accelerate deployment o f the this super sonic transport to every community in the country.

   I want to thank my colleagues for their support and collaboration on this bill. Senator JOHN KERRY and his staff have been involved in every aspect of this legislation, and we could not have formulated the bill without their detailed knowledge of the communications industry. And Senators ROCKEFELLER and SNOWE recently introduced a similar bill focusing on the deployment o f broadband i n rural areas, and the legislation we introduce today incorporates and expands upon their work.

   This bill is meant to be a proposal. As we consider this measure, Congress may decide to modify it. Moreover, we have not yet received a revenue estimate on the bill, and if it proves to be too expensive, we will have to scale it back. It is time, however, to focus on this issue. Let us begin the discussion of how we can provide the stimulus necessary to ensure the availability of high-speed communication to every

[Page: S4829]  GPO's PDF

   Mr. President, I ask unanimous consent that a copy of the bill and letters of support from a number of organizations appear in the RECORD.

   There being no objection, the material was ordered to be printed in the RECORD, as follows:

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

   SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Broadband I nternet Access Act of 2000''.

   SEC. 2. FINDINGS AND PURPOSE.

    (a) FINDINGS.--The Congress finds the following:

    (1) The Internet has been the single greatest contributor to the unprecedented economic expansion experienced by the United States over the last 8 years.

    (2) Increasing the speed that Americans can access the Internet is necessary to ensure the continued expansion.

THIS SEARCH     THIS DOCUMENT     THIS CR ISSUE     GO TO
Next Hit        Forward           Next Document     New CR Search
Prev Hit        Back              Prev Document     HomePage
Hit List        Best Sections     Daily Digest      Help
                Doc Contents