tv U.S. House of Representatives CSPAN November 3, 2011 1:00pm-5:00pm EDT
on the fiscal year 2012 bill will encourage the conferees to consider and support several funding items as they negotiate the final agreement on this three pack of bills. while i believe this motion is unnecessary, i am willing to accept the gentleman's motion as it does address some important issues that will be considered by the conferees. . as we move forward, i expect the ranking member and myself to work together to negotiate these issues and for today i can accept this motion. first if i proved, it would express the house's support for funding for the cops program within the department of justice. while local law enforcement is primarily a state and local responsibility, there's strong bipartisan support for a variety of federal programs that help first responders, including the cops program, for state and local police.
the commerce-justice-science bill has historically included a range of programs to strengthen local law enforcement, including burn grants, state assistance, juvenile accountability, programs to combat violence against women and cops programs. cops has not only supported hiring and rehiring of new officer pus aloud local police departments to mod erpize their technology and address the enforcement and cleanup challenges of the meth epidemic. however we must make these funding decisions very carefully to avoid adverse impacts. state and local budgets are often incapable of sustaineding new first responder positions and this risk is especially high given the current economic challenges in our local communities.
second this motion encourages the conferees to support funding for the highway emergency relief program, commonly referred to as the e.r. program, this program is authorized and provides states with funds to repair eligible roads damaged by disasters and catastrophic events. this program was created to rebuild after disasters and get businesses and everyday life back up and running. unfortunately, in 2011, the total amount of eligible disaster stricken roads exceeded the level of available e.r. pounds. it's important that we now provide the appropriate level of funding to ensure that states and communities receive the legitimate assistance that they are relying upon. so mr. speaker, again, while i don't think this motion is necessary, i will accept it and look forward to working with
both sides on these important shrs to come up with a satisfactory solution. mr. dicks: will the gentleman yield? mr. rogers: i yield. mr. dicks: i want to commend the chairman for his commitment to return to regular order. i wish we could have done all 12 bill bus we at least got six of them done and i want to thank him and his staff and the staff of the minority for working together in a collegial way. i think it's important for the american people to know that the appropriations committee here is working together on a bipartisan basis. now we may have differences on economic theory and everything else but we are committed to getting these bills passed and bringing as many as we can to the floor. i hope next year we can start a little earlier and get the budget resolution in and move these bills. i would love to see us, in the second session of this congress,
get all 12 bills to the floor where members could offer their amendments. i think that still should be our goal and objective. mr. rogers: i thank the wrelt for those words. he is exactly right. he and i started out this year both new to our job on the committee, but we determined and agreed with each other and committed to each other that we would work together to try to restore the regularred orer that used to prevail on these appropriations bills where we had heated debate but collegial debate. and realizing that we have to finally come to some agreement on these bills that keep the government going. we don't have the luxury of waiting. the gentleman has been a great partner in this work all year long and i look forward to the rest of the work. now on this year's bills, the 2012 bills that we're working on now, it's my hope and ambition,
i know you share this with me that we finish these bills before the end of the calendar year this year. mr. dicks: absolutely. i think -- we are determined to do that. i'm glad to see that the other body is actually bringing some of these mini buses to the floor and allowing their members to have a vote. we may have inspired them. mr. rogers: quell -- well, that would take some doing but nevertheless, i agree with you. i am tickled to death to see the senate finally acting, they only passed one bill up until two days ago of the 12. we passed six through the house and sent them over there without response until now. but i want to finish the 2012 bills right away so we can begin work in january on the 2013 bills and we'll have plenty of time to do them one by one, which is the regular order and
what we all want to see happen. but that's my goal and ambition and i know the gentleman shares that. mr. dicks: we -- i concur with what you've said and i concur with the direction we're going in. i just hope we can do a little better and finish the job next year. it's been done before, it's not impossible, and ea also -- and we also have to think about the impact of these tpwhoinlsdemoif country, that's very important as well. mr. rogers: you know, we were sidelined a good part of this year. from our regular business. the h.r. 1. we inherited a house that had not passed an appropriations bill for fiscal 2011. so we spent the first five months or so of the year trying to pass a bill to fund that current year. fiscal 2011. as soon as we got finished --
mr. dicks: what your point is, that's why it's so important to finish this, this year, in 2012, before the calendar, so we don't have to waste time next year finishing the job. mr. rogers: exactly. nevertheless, it held us up for five months and kept us from doing our chores for fiscal 2012. then comes along the debt ceiling increase debate that took weeks and sucked all the air out of everything else system of we were prevented on the committee from doing our regular chores. and as the gentleman says, we want to finish these bills for fiscal 2012 so that finally in fiscal 2013 we can have a real clean year taking each bill one by one. mr. dicks: speaking of a clean year, let's try to get rid of as many riders as we can, mr. chairman, you know it's the right thing to do. i yield back my time. mr. rogers: oh, and by the way in closing, we're going to
conference with the senate, these three bills, this afternoon as a matter of fact, 5:00. that's the first time that there's been a house-senate appropriations conference in years. so between us, i think -- and the senate, we are achieving something almost historic here that is going to conference with the senate which used to be a routine thing and we hope to restore that idea. with that, mr. speaker, i yield back. the speaker pro tempore: all time being yielded back, without objection, the previous question is ordered. the question is on the motion to instruct. those in favor say aye. those opposed, no. in the opinion of the chair, the ayes have it. the motion -- >> mr. speaker. mr. dicks: on that, i ask for a
recorded vote. the speaker pro tempore: does the gentleman ask for the yeas and nays? mr. dicks: yes. the speaker pro tempore: the yeas and nays are requested. those in favor of a vote by the yeas and nays will rise. a sufficient number having risen, the yeas and nays are ordered. pursuant to clause 8 of rule 20, further proceedings on this question are postponed.
up house resolution 453 and ask for its immediate considering. the speaker pro tempore: the clerk will report the resolution. the clerk: house calendar number 85, house resolution 453, resolved that at any time after the adoption of this resolution, the speaker may, pursuant to clause b of rule 218, declare the house resolved into the committee of the whole house on the state of the union for consideration of the bill h r. 2930 to amend the securities laws to provide for registration exceptions for certain crowd funded securities and for other purposes. the first reading of the pill shall be dispensed with. all points of order against the pill have waived. general debate shall not exceed one hour equally divided and controlled by the chairman and ranking member of the committee on rules. it shall be in order to consider as an original bill the amendment recommended by the committee on financial services now printed in the bill.
the committee amendment in the nature of a substitute shall be considered as read. all points of order against the committee amendment in the nature of a substitute are waived no amendment to the committee amendment in the nature of a substitute shall be in order except those prinned in part a of the report on the committee on rules accompanying this resolution. each such amendment may be offered only in the order printed in the report, may be offered only by a member designated in the report, shall be considered as read, shall be debatable the time in the report, shall not be subject to amendment, and shall not be subject to a demand for division of the question in the house or in the committee of the whole. all points of order against such amendments are waived theafment conclusion of consideration of the bill for amendment, the committee shall rise and report the bill to the house with such amendments as may have been adopted. any member may demand a separate vote in the house on any amendment adopted in the committee of the whole to the
bill or to the committee amendment in the nature of a substitute. the previous question shall be considered as ordered on the bill and amendments thereto on final passage without intervening motion except one motion to recommit with or without instruction. section two, upon dotchings this resolution it shall be ined orered to consider in the house pe the bill h.r. 294 to -- 0, direct the securities and exchange committee under regulation d. all points of order are waived. the amendment in the nature of a substitute recommended by the commn ofinancial services now printed in the bill shall be considered as adopted. the bill as amended shall be considered as read. all points of order against provisions in the bill as amended are waived. the previous question shall be considered as ordered on the bill as amended and on any further amendments thereto. to final passage without intervening motion except, one, one hour of debate equally divide and controlled by the
chair and ranking minority member of the committee on financial services, two, the further amendment printed in part b of the report of the committee on rules accompanying this resolution if offered by mr. representative miller of north carolina or his designee which shall be in orter without any intervention, shall be considered as read, shall be considered as read, and three, one motion to recommit with or without instructions. the speaker pro tempore: the gentleman from texas is recognized for one hour. mr. sessions: if for the purposes of debate only i yield the customary 30 minutes to my friend the gentleman from colorado, a brand new father who today presents himself on the floor as we work together. i yield this time to mr. polis, pending which time i yield myself such time as i may consume. the speaker pro tempore: the gentleman is reek nizzed. . mr. sessions: mr. speaker, i
ask feak that all members may have five legislative days to revise and extend their remarks -- i ask unanimous consent that all members may have five legislative days to revise and extend their remarks. house resolution 453 provides for a structured rule for consideration of h.r. 2930 and h.r. 2940. this rule allows for all seven amendments submitted to the rules committee by democrats and republicans to be made in order. mr. speaker, i rise today in support of this rule and the underlying bills, h.r. 2930, the entrepreneur access to capital act was introduced on september 14, 2011, by my friend and the gentleman from north carolina, mr. pat mchenry and was reported by the committee on financial services by a voice vote. last week the second bill, h.r. 2930, the access to capital for job creators act, way introduced by the republican majority whip, the gentleman from california, mr. mccarthy, and also passed the committee on financial services by a
voice vote last week. both pieces of legislation have been run through regular order. members from both sides of the aisle have had opportunities to submit perfecting ideas and those amendments have been carefully considered. every amendment that was submitted to the rules committee was made in order and will be given full and fair consideration today. the chairman of the rules committee, the gentleman, mr. dreier, has once again allowed the house to work its will through an inclusive legislative process. on december 10, 2009, i stood on the floor and i argued then against the rule's consideration for the bill known as the dodd-frank financial reform bill. it should be noted that i authored two proposals amongst many republican and democratic
members that were all shut out that day. then speaker nancy pelosi chose to have the dodd-frank without any open process consideration. the result of that legislation has caused great concern in financial markets, not just here in the united states, but has caused financial concern around the world. today the republican house is changing that course in consideration of bills from the financial services committee. today, we're looking at targeting a removal of outdated regulations simply to encourage market access for millions of small businesses to encourage not only investment but also jobs in america. so for those who are listening to this, you could consider this a jobs creation bill. so i would advance this cause down the street to the white house to encourage the president to know that this is
yet another job-creating, job-saving jobs in america bill that the u.s. house of representatives is once again considering and today on a bipartisan basis with every single amendment that was submitted to the rules committee through an open process on the floor of the house of representatives ready for us to move this bill and vote on that today. mr. speaker, our economy has a revenue problem. the administration continues to promote policies that slow economic growth. republicans believe we must create an environment that encourages investment in small business, really, the engine of our national job creators. this underlying bill will do just that. h.r. 2930 would remove restrictions on crowd funding, allowing companies to pool
small investors so that small businesses and entrepreneurs can raise capital equity. outdated s.e.c. regulations do not allow business owners in search of investments to solicit or to advertise. this legislation is needed and is being presented on a bipartisan agreement basis. yesterday, i met with community bankers from texas, scott holtencamp, the president of value bank, john jay, the president of roscoe state bay, and one with the independent bankers of texas, among others, who described to me their inability to raise capital investment, not due to a lack of willing investors but as a result of burdensome or regulations which inhibit or do not allow this. they informed me that the s.e.c. limit on individual
investors restricts their abilities to raise funds through community participation and local business creation. i'm -- i was proud to tell them and i will tell them again today i heard your story and we are on the floor doing something about that that will be of immediate benefit and help to jobs and job creation in america. today on the floor of the house of representatives in a bipartisan agreement fashion. h.r. 2940 allows for general solicitation in advertising which would attract private investment. small privately held companies will no longer be forced to have an existing relationship with potential investors. however, the legislation requires the s.e.c. to ensure that investors are accredited. as congressman jared polis from colorado, the lead today for the rules committee on behalf of the minority, indicated at
the rules committee meeting yesterday that crowd sourcing investment through new advertising mediums such as social media would allow for access to new pools of valuable capital. these are exactly the kind of ideas that is being brought today to the floor for the creation of investment dollars to help jobs in america and to make sure we are prepared for our future. our nation is in crisis. we cannot wait. with an unemployment population of over 14 million people, we cannot continue the failed policies of government spending which have brought us to this point. investment capital for small business continues to sit on the sidelines because of the uncertainty created by burdensome regulations and outdated rules. the underlying bills will
foster job creation by simply allowing the private sector to participate in this endeavor. the future success of our economy rests in the hands of private small business, not government. unleashing their potential is the sole focus of this republican majority and the u.s. house of representatives. the result is an economic environment that promotes growth and generates revenue as well as the creation of jobs in america. i urge my colleagues to vote for this fair rule that allows consideration of all requested amendments and to vote for the underlying bills. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves. the gentleman from colorado is recognized. mr. polis: thank you, and i thank the gentleman from texas. i'd like to express my appreciation to the leadership in the house for expediting these two very important bills and bringing them before the
house of representatives. i rise in support of the underlying bill, the entrepreneur access to capital act and access to capital for job creators. now, while i support the two bills before us, i do wish the rule was an open run. i will be voting against the rule. an open rule will allow the house to work its will in a true democratic process, allowing members to come down to the floor, freely debate these bills. fortunately in the rules committee we were only offered a structured rule. now, both of these bills accomplish something very important in helping startups work. let me discuss briefly of how this accreditor concept works. you need to be worth $1 million or have income of $200,000 a year. now, that's a very rarifide strata. what does that mean? you can participate in a private equity offering that doesn't have to go through the full s.e.c. process which is come bersome and cost --
cumbersome and costs a lot of money. funding for startups is reserved for those that is worth above $1 million. the easiest way to make $1 million is to be worth $1 million. people over $1 million are heretofore had a monopoly in participating in these kinds of opportunities. what account average fallly with a net worth of $-- family with a net worth of $100,000 do? they can go to las vegas and bet on number nine. they can buy gold which is being pushed by all these profit organizations and i think we need a congressional investigation to that. many of these organizations selling gold sell it for above market value by preying on unsuspecting people who are not accredited investors. they might be worth $50,000 or $100,000. what you find, by the way, this whole concept of tying accredited investor to net worth has its flaws. just because someone has several million dollars doesn't
mean they are a sophisticated investor. there could be someone worth $10 million that could be very sophisticated. it's unfortunate that we have the whole system tied to that. what we see before us today are two important links in this armor. one is consistent with the current concept of accredited investor that at least opens up beyond their personal networks and the other one allows small investors to participate in a more meelingful way. first, the entrepreneurial access to capital act, crowd funding. what this does is provides a new way that small business can raise money. $1 million or $2 million. that's a sizeable level for companies to start. historically, how did they raise that money? they would go to a venture capitalist. they would go to a wealthy individual. we call that person an angel investor. they get a check for $500,000. the investors had to be worth lr more than $1 million. your average american might only have $5,000 to invest or
$1,000 to invest, was unable to under law participate in that offering. what this does is it opens up an avenue that allows the individual investor to invest up to $10,000 in his startup company. now, that's a risky investment. they could lose that $5,000 or $2,000. they could go to las vegas and lose that a lot quicker too with a lot less upside. this gives every american the opportunity to invest in startup companies. one of their friends is starting one, a concept they're excited about, and reap the rewards as well. in addition to feeling part of something special, some of these investments, the vast minority, could return 50-1 or 100-1 and acquire wealth and that is exciting. the access to capital jobs creator act, currently you have to know the right people to get into a private equity deal. in fact, the company that's offering private equity is not even allowed to under s.e.c.
regulation post the perspective on their website. what this does is creates a safe harbor that allows them not to advertise in in the sense of promoting and trying to sell shares but in the sense providing it in a nonpassword protected way on their website to allow people who aren't part of their personal network of elite friends to participate in that private equity offering as well. look, the average medium household net worth in this company is about $100,000. and previously all of these investment opportunities have been reserved for people worth over $1 million. now, if somebody -- an american family watching this or one of my constituents is worth $100,000 or $150,000 or $50,000, it may not make all the sense in the world to invest $5,000 or $10,000 in one startup but a cap of $10,000 is reasonable. it's their money and their right. this provides a new financing mechanism for startups in this
country. a way that a startup that has broad appeal and a broad network can go to 1,000 people that have $1,000 each rather than one wealthy investy for $1 million that was previously nearly impossible under current law. mr. speaker, i'd like to submit to a record a statement of administration policy. the speaker pro tempore: without objection. mr. polis: thank you. i'm proud to say this bill, the entrepreneur access to capital act, has strong support from the administration. this will create capital and create jobs and the administration looks forward to working with congress to craft legislation that facilitates capital for our nation. i'd like to applaud the leadership of the president of the united states and in strongly supporting these endeavors. as a former small business owner i know how important it is to invest in a company's future and critical how resources are for growth. the more avenues we can have for financing, startup companies are allowing a mom and pop company to expand, the better for the growth of our
economy. more importantly, these two pieces of legislation before us demonstrate the democrats and republicans can work together. we can put aside our partisan differences. we can fast track, commonsense pieces of legislation and work towards solutions to spur economic growth. now, to be clear, these two bills alone don't do enough to turn our economy around. these measures do little to address what the american people are asking us for, creating jobs in the short term and getting the economy moving. well, they have a poss -- will they have a positive impact in creating jobs and allowing financing to flow to startup operations? yes, but they are not fundamentally game changers. these bills will allow average americans an opportunity to invest in early stage companies. now, many of those opportunities won't work out. american investors will lose their money. other american investors will make money but, again, it is a very american concept that it is your money to invest as you choose fit and the best opportunities shouldn't be reserved for millionaires. we should make them available
widely to all americans. democrats have been instrumental in protecting these investors. democrats added a critical provision requiring that issuers verify they're eligible to testify and there needs to be a balance between allowing them to invest and protecting them from fraud. there is a fine line and there are some areas where sham investments are being aggressively promoted that are contrary to the spirit if not the letter, of the law. there are real opportunities that those who are worth under $1 million are ineligible from participating in, and those who may be worth $1 million but don't know the right people may be unable to participate in private exquestion -- equity
options. i reseb the balance of my time. the speaker pro tempore: the gentleman from texas is recognized. mr. sessions: thank you very much, mr. speaker. at this time i'd like to yield to the gentleman from california, the chairman of the rules committee, 10 minutes. the speaker pro tempore: the gentleman is recognized for 10 minutes. mr. dreier: i ask unanimous consent to revise and extend my remarks and i want to begin by saying to the distinguished vice chairman of the rules committee, mr. sessions, the gentleman from dallas, that i appreciate his energy and effort on the rules committee and i want to say that i think that he's very clearly made the case that we have through this entire congress focusing on the -- on what the american people want us to focus on. it's a specious claim that's been made by many that somehow
this institution has failed to address the issue of job creation and economic growth. i appreciate the good words and thoughtful comments on capital formation made by the minority manager of this rule on the floor. my friend mr. polis, who has taken on and throughout his life has been focused on the idea of entrepreneurial -- taking the entrepreneurial spirit and understanding jobs, he understands what it takes. capital formation is a critical part of that the two measures made in order under this rule go a long way in this 21st century recognizing that for us to grow the economy and create jobs, we're going to need to ensure that decreasing the regulatory burden that undermines theable for small businesses to have access to capital as they pursue
innovative ideas is something that needs to be addressed and that's exactly what we're going to be doing. i say it's a specious claim, mr. speaker, that many people have made, that this institution is not taking action and for that reason, i hope very much that with this bipartisan effort, that we have -- that we have here, a bipartisan effort, that we will bring to an end those kinds of statements, mischaracterizing, grossly mischaracterizing the work of the united states house of representatives. i believe that it's been inappropriate to make those claims for a long period of time. why? because we have made many, many, many efforts over the past several months to put into place policies that can help create jobs. have they all worked at this point? no. they're all obviously prospective. but if you look at what we've
done encouraging domestic nrming production, that's a critically important part of getting the economy going and increasing job opportunities and in reducing energy costs for our fellow americans. if you look at the notion of trying to ensure that we open up new markets around the world, for union and nonunion workers here in the united states of america, we have just in a bipartisan way with the support of both democrats and republicans passed measures that will open up markets for us in colombia, in panama, an in south korea. i was privileged yesterday to be with the ambassador from korea as we marked a sell brace, a bipartisan celebration, of that effort. if you look at the measure passed again with huge bipartisan support dealing with the 3% withholding for those contracting with federal, state, and local governments, that we are bringing that to an end. that's something the president of the united states has asked of us. we passed it in the house of
representatives. i have to admit it's a measure that should easily pass the united states senate. i hope that majority leader reid brings that measure up in the senate. unfortunately, it hasn't happened so far, but i do think it's something that should pass the democratic controlled senate, it's passed the republican controlled house of representatives with strong bipartisan support and just this week, we are continuing down that path toward putting into place a structure that will reduce the tax and regulatory burden to create jobs for our fellow americans. i think it's also important to note, mr. speaker, that one of the things we need to do since we have seen an 8 % increase in nondefense discretionary spending for the four years leading up to this year, it's important that we decrease the size and scope and reach of government so that those small business men and women seeking
to create job opportunities are in a chi mat where that can take place. that's why i say that virtually everything we've been doing to reverse that course we've been on, with the 8 % increase in nondefense discretionary spending, everything we've been trying to do to pear this down, the work going on -- to pare this down, the work going on with our colleagues charged with reducing by $1.2 billion over the next decade, the level of spending, an we hope beyond that level. all these things are geared to getting our economy growing so that our fellow americans will have more job opportunities. so the message a clear one. the process we have is a good one. i'm happy to say if you look at the number of amendments considered on the house floor in the first nine months of this year, we've had 842 amendments considered on the house floor. i'm pleased we have been able to
have a greater degree of openness and transparency. we have made every single amendment in order. trrp more democrat amendments made in order than republican amendments made in order on the two bills coming before us. we have seen, as i said, 842 amendments considered here on the floor in the first nine months of this year. mr. speaker, in the entire 111th congress, that's two years, two sessions of congress, there were a grand total of 787 amendments considered on the house floor system of i'm very pleased that we have, in a bipartisan way, been able to open up the floor so that members, regardless of their political party, democrats, republicans alike, have been able to have their ideas considered and that's exactly what is going to happen under this special rule which we're considering at this moment system of mr. speaker, let me say again, job creation, economic growth is what this is about. the american people are hurting. the people of my state have an unemployment rate well in the double digits.
i have -- part of the area i represent has a 15%-plus unemployment rate, we need to do everything we can to get our economy moving. i would say to anyone out there, anyone who would try to make the claim that the united states congress, specifically the house of representatives, is not taking action to create jobs and get our economy growing, is just plain wrong. and that kind of mischaracterization has got to come to an end. i look forward to, again, bipartisan support for both this rule, which allows, again, every democratic and republican amendment that was submitted to us to be considered on the floor, and also the very strong, bipartisan support that i know that beth of these somebodies will have as we proceed with debate. i yield back the balance of my time. the speaker pro tempore: the gentleman yeeds back. the gentleman from colorado is recognized. mr. polis: i would like to yield
two minutes to my colleague on the rules committee, the gentleman from massachusetts, mr. mcgovern. the speaker pro tempore: the swrelt is recognized for two minutes. mr. mcgovern: thank you, let me remind my colleagues, this is not an open process, this is not an open rule. if members want to offer an amendment on the floor, they are denied that opportunity. that's typical of the way this congress has been run for the -- from the very beginning. promises of openness have not come to pass. let me also say that the republican majority in this house of representatives has failed. they've failed miserably. on the issue of jobs. we have talked about everything but jobs. this week, we began the -- our proceedings by debating a bill reaffirming the words "in god we trust" as our national motto. mind me above the speaker is "in god question trust," i didn't know there was a problem.
it doesn't need reaffirming, it was there we spent a day debating that and not debating jobs. there are millions of people in this country without work. we should bring the president's jobs bill to the floor. why can't we wring the president's bill to the floor. we have borne support, all the items had bipartisan support physical the -- until the president presented it. i hurge my colleagues to vote no on the previous question so we can bring unthe -- up the issue of china's manipulation of currency. we have been time and time and time again not aloud to bring that to the floor. we can't bring the president's jobs bill to the floor. i have offered multiple times in the rules committee an amendment to end u.s. taxpayer subsidies for big oil. put that toward deficit reduction or put that toward investment and job creation. time and time again on party line votes we have been denied the right to bring that to the
floor. the plups have failed miserably on the issue of jobs. to come out and say jobs have been a priority is laughable given the stuff we have debated on this floor. i yield back the balance of my time. the speaker pro tempore: the gentleman tees i'm has expired. mr. dreier: would the gentleman yield to me? mr. sessions: mr. speaker, i'd like extend to the gentleman five minutes. the speaker pro tempore: the gentleman is recognized for five mins. mr. dreier: i'd like to engage in a discussion, if i might, with my friend from worcester who has just in response to my quest to recognize that the measure that is before us today, a job creating measure, will in fact, mr. speaker, enjoy strong bipartisan support and everyone acknowledges, all one needs to listen to is the minority floor manager of this measure, that this measure is a jobs creation item. i will say -- i'd like to yield
to my friend from worcester. mr. mcgovern: why won't you allow the president's jobs bill to come to the floor? why won't you allow an up or down vote on china's currency? mr. dreier: reclaiming my time. i thank my friend for his thoughtful contribution. let me respond to his points. mr. speaker, this is the president's jobs bill that we are considering today right here on the house floor. the president stood just over the gentleman's shoulder and addressed a joint session of congress on the issue of job creation and economic growth and how he wanted his jobs bill brought forward. you know what he said? he said we needed to pass the colombia, panama, an korea free trade agreements, and guess what? with bipartisan votes, we have embraced and supported that provision of the president's jobs bill. mr. mcgon: will the gentleman yield? mr. dreier: let me completely
thought. no, i will yield to the gentleman. mr. mcgovern: come talk to employers -- mr. dreier: i will reclaim my time. let me just, since my friend brought up the issue of colombia, an we have disagreed on this for a long period of time, there are 40 million consumers in colombia. and right now, right now, there are people who are union workers at caterpillar and at john deere and at whirlpool and other manufacturing companies in the united states who are going to have access to those consumers because of the agreement that we have put into place. so listen, i'm -- mr. mcgovern: the gentleman said the same about and a half tasm mr. dreier: i'd like to yield to my friend. mr. mcgovern: the gentleman said the same thing about and a half tasm mr. dreier: i would like to reclaim my time to say to my
friend if one looks at the jobs created in the manufacturing sector of our economy, let's remember, and i'm very sympathetic with those workers my friend has spoken about in his district but i think it's important for us to note that the united states of america today is still, is still the number one manufacturing country on the face of the earth. it is true. it is true that there are other countries that are growing in the manufacturing sector. it is true that we have lost manufacturing jobs in the united states of america, in large part due to the tax and regulatory burden, things like repatriation and other items which play a role in discouraging economic investment here in the united states. but having said that, we can't forget that the united states still is the number one manufacturer. so with 96% of the world's consumers outside of our border, the idea of saying we're ignoring the president's request, the president stood here, i admit, it's with our encouragement, i encouraged him to do this days after our
election, he has supported opening up markets in colombia and panama and south korea. if i could completely thought this time, i'd like to compleast complete that. i will say, mr. speaker, as we seek to do that, we have embraced these measures and we're doing them in a bipartisan way, and so as my friend got up and said, we're talking about "in god we trust" rather than talking about jobs, we do have the ability to walk and chew gum at the same time but we all know that the top priority is making sure that we get our economy back on track and mr. speaker, that is exactly what we're doing. that's exactly what we have done for the past several months. . because in the last congress and with passage of things like the stimulus bill, they told us if we passed the stimulus bill the unemployment rate would not exceed 8%. we all know where it says. in part of my district it's been over 15%.
that's a failed policy. we have been putting in place policies working in a bipartisan way unlike the stimulus bill was put into place at the beginning of last year. we have now -- we have now, i believe established policies to ensure those workers are able to have the kind of potential job opportunity that is necessary. i'm happy, of course, to further yield to my friends. mr. mcgovern: two final thoughts -- mr. dreier: would never yield to me. mr. mcgovern: this is not the president's jobs bill. mr. dreier: if i could reclaim my time to say that this is not the president's jobs bill. these are things that he said when he addressed us right here in a joint session of congress, and so it is for that reason, for that reason that we have been able to come together in a bipartisan way to address these
very important issues. the speaker pro tempore: the gentleman's time has expired. mr. dreier: so i'm happy, mr. speaker, to recognize and support bipartisanship when it comes to getting america working again. the speaker pro tempore: the gentleman's time has expired. the gentleman from colorado is recognized. mr. polis: briefly, i yield myself a minute to respond before i yield to the gentleman from michigan. the speaker pro tempore: the gentleman is recognized. mr. polis: and to be clear, you know, these bills have the potential to create jobs, but there are also many investors that will lose money as a result of these bills. again, it's their money to lose. this -- these bills are consistent with that. and obviously these bills, in addition to causing job growth in companies, will also cause misery to people. but it's their money to lose. it's probably better that they invest it in startup instead of investing in goal and go to las vegas. it's a job for a year. it limits the loss of 10% for their income. if someone makes $80,000 they can only lose $8,000 of this.
hopefully that will not put them out of house and home and give them the same opportunities to invest in startup companies that millionaires have had for years. it's my honor to yield three minutes to the ranking member of the ways and means committee, my good friend, the gentleman from michigan, mr. levin. the speaker pro tempore: the gentleman from michigan is recognized for three minutes. mr. levin: i ask unanimous consent to revise and extend. i'm glad we're having this debate. this bill isn't basically a jobs bill. and it puts a halloween mask on it to say that's what it is basically. the gentleman from california talks about manufacturing. the president struggled to save the automobile sector, the domestic sector of this country over the opposition of many republicans, including what is now apparently the leading nominee for the republican
presidential nomination. if we really want to talk about jobs, what we should do is turn down the previous question on this bill so we can bring up the currency bill. this will put republicans to the test on a real jobs bill. the estimate is by fred burkston, the passage of legislation like this, changing the chinese undervaluation of their currency, will create a million jobs. no one in authority has said this bill will create any jobs. and paul krugman, his estimate is 1.5 million jobs. and you talk about bipartisanship. this currency bill is truly
bipartisan, so it will also put to the test whether you believe in bipartisanship when it comes to a real jobs bill. this bill, 639, now has 230 sponsors, a majority in the house of representatives, and it has 62 republicans and it passed the senate a similar, though not adentcal bill, with strong -- identical bill, with strong republican support. so this previous question, everyone who votes will put you to the test. do you believe in a real jobs bill? it won't destroy the bill on the floor. it will add to it. and also, do you really want to not only have bipartisan action but on a currency bill that will really mean hundreds of thousands of jobs to the american people, not six months from now, as this bill before
us might bring about a few, but right in the immediate future tens of thousands? so i strongly urge that we vote no on the previous question and free the majority of the members of this house to act on a bill that they now sponsor. free us, take off the bonds. the speaker pro tempore: the gentleman's time has expired. the gentleman from texas is recognized. mr. sessions: thank you, mr. speaker. mr. speaker, at this time we're scroined by one of the most wonderful atributes of the financial services committee, the gentlewoman from illinois, the chairman of the insurance, housing and community opportunity subcommittee, the gentlewoman, mrs. biggert, and i'd yield her four minutes. the speaker pro tempore: the gentlewoman from illinois is recognized for four minutes. mrs. biggert: i thank the gentleman for yielding me the time and, mr. speaker, i rise in support of this rule. it is time to act.
we cannot afford to wait any longer on regulatory agencies to tweak the rules and regulations, commission further studies or have another agency. employment at regulatory agencies is up 30% while private sector jobs have decreased more than 5%. and despite the increased manpower, regulators have been unable to meet deadlines, issue timely rules or reform unnecessary and outdated regulations. the cost of studying the business murder as a percentage of per capita income has more than doubled -- studying the business as a percentage of per capita income has more than doubled. the u.s. has fallen to number 13 in terms of easing of starting a business. to reverse these troublesome trends, it is critical that congress fore cuss its efforts
on -- focus its efforts on eliminating -- instead of inhibiting innovation we must put in place sound policies that harns a america's -- harness america's entrepreneurial spirit and spur economic growth. i am pleased we are able to join with our friend on the other side of the aisle on today's legislation which will amend outdated provisions that currently inhibit the ability of small businesses to connect with investors. these bipartisan provisions will allow small businesses to raise essential job-creating capital and reclaim their rightful place to the most vibrant job creators in america. i'd like to recognize the gentleman from california and the gentleman from north carolina for their hard work on these bills and i encourage all my colleagues to support this rule and the underlying legislation. and i thank the gentleman from texas for the time, and i yield back. the speaker pro tempore: the
gentlewoman yields back the balance of her time. the gentleman from colorado. mr. polis: thank you, mr. speaker. again, i express appreciation to both majority and minority leaders for expedited action in trying to get to the president's desk these two important measures and with that i'll yield two minutes to the gentleman from pennsylvania. the speaker pro tempore: the gentleman from pennsylvania is recognized for two minutes. >> thank you for yielding. i thank the ranking member of the ways and means really -- i think the ranking member of the ways and means really hit to the point of what this is is this is not against the two bills that are the underlying bills for this rule but this is about jobs. and you know, in this body, many times we think about what does a poll say? what does this poll say? mr. critz: well, when i go home, every one of my congressional district is talking about jobs, is talking about the economy. i was thrilled to hear that these two bills flew through the process, introduced in september and now we're debating them on the floor. what i can tell you, though, is that the chinese currency, the h.r. 639, the currency
manipulation bill was proposed in february of this year, and i've heard comments like bipartisan and let the house work its will. well, this bill enjoyed tremendous bipartisan support last year. 348-79 with 99 republicans voting for it. reintroduced this year. it's interesting in this body. many times we do things in this body and then complain about things that go to the senate and it doesn't happen in the senate. well, here's a bill, actually a stronger version of this bill that passed the senate 63-35. it's the house. it's the house leadership. it's the republican leadership in this house that is denying the chinese manipulation bill coming to the floor. let the house work its will. this is about jobs. as mr. levin mentioned, estimates are a million to 1.5 jobs, 1.5% g.d.p. it's something that we should all be passionate about. this is about standing up for
the american people. this is about standing up for the american manufacturer. the speaker said this could be dangerous. ask folks in the tire industry. ask folks in the steel tubing agency who watched chinese unfair trade practices put them in jeopardy and put their people out of work. this is something about you have to stand up. you have to take a stance. 62% are co-sponsors of this bill. i urge defeat of the previous question. it does not defeat the underlying bill so we can talk about jobs and this bill, h.r. 639. the speaker pro tempore: the gentleman from texas. mr. sessions: we are here talking about capital formation. we're here talking about entrepreneurial spirit catching up with ideas to go to make job creation and then for the jobs to be here in america. and that's what this bill is about today. it is about a bipartisan
attempt, republicans and democrats working together through regular order to the rules committee all republican and democrat amendments coming to the floor and these working these few hours, a chance for not only members of congress to effectively present their ideas and do the will of the people but for us perhaps more importantly to work together to find common ground on important issues that will aid and help americans have sounder financial footing. that's what this bill's about today. i know there are other bills that people want to debate and want to bring to the floor. i felt that way for four years when the other the speaker pro tempore: was in fact in control -- mr. sessions: i felt that way for four years when the other side was in fact in control. this bill is about financial services.
i am proud of what we are doing on the floor today and i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from colorado. mr. polis: thank you. it's my honor to yield one minute to the gentlelady from ohio, ms. sutton. the speaker pro tempore: the gentlelady from ohio is recognized for one minute. ms. sutton: i rise to urge my colleagues to defeat the previous question and get back to the work of really creating jobs in our country. every week i go home to ohio and i meet with countless men and women who are ready to get back to work. they're ready to prove something that we already know, that the american worker is the most productive and innovative in the world. and right now there are thousands, an estimate of a million americans who could be put back to work if we held china accountable for manipulating its currency. by rigging the system and giving the manufacturers their manufacturers an unfair advantage, china has placed a roadblock in our road to economic recovery. the senate has already taken
action. they passed a bill to hold china accountable and give our workers a level playing field on which to compete. if house republican leaders are really serious about significant actions to create jobs, they can bring this bill to the floor right now, right here today. we can do something big to help people in ohio and across the country. i urge defeat of the previous question so that we can bring the currency manipulation bill to the floor and bring jobs back to the united states. and i yield back. the speaker pro tempore: the gentleman from texas. mr. sessions: thank you very much, mr. speaker. . regarding what is on the floor today, it is important that we recognize this is a continuing trend for job growth, job creation on not just a net basis but on a positive basis without the loss of jobs. the federal government creates an average of 4,000 final rules
and regulations each year and that is what inhabits job grothe. that's what the -- job growth. that's what the prior two congresses have been about. massive rules and regulations no the empowerment of the free enterprise system. we need to remember that what we are here for is to work in the best interest of making a future brighter and better for those who will be with us today and those who will be behind us for their future. and that's why job creation, investment, and capital formation is important. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from colorado. mr. polis: i thank the speaker. i yield one minute to the gentleman from new jersey, my good friend. the speaker pro tempore: the gentleman from new jersey is recognized for one minute. mr. pascrell: i thank the gentleman. i thank the speaker. i rise in strong support of the motion so that we can amend the rule, provide for the consideration of a bill that will create over one million jobs. the currency reform for fair
trade act. the floor skedle of the house has long been determined by the majority leader. everybody knows that. i hope that our majority leader would therefore represent what is a majority of our members. 230 members who co-sponsored the bill. that's not so bad. and schedule it for a vote. we quite simply can't afford to wait any longer. china's currency manipulation has a devastating impact on manufacturing and on the industry across this country. this results in chinese exports being up to 30% cheaper in america. now you know where the problem is. now you know what's hurting american industries. and conversely our exports being more expensive in china. estimates varery. the economists believe this manipulation reduces unemployment by no more than -- any more than from one million to 1.5 million. i thank the gentleman and
speaker. we are out of excuses, mr. speaker. we really are. we've got support from both side of the aisle on this. there are over 14 million people unemployed in america. the bill costs nothing to the taxpayer. this is amazing that we are putting something before the house that won't cost us any money. no taxes, the senate has already passed a bill. bipartisan. huge. numbers. margin. there are 230 bipartisan co-sponsors in our institution here. this legislation passed with over 350 votes. no excuses, mr. speaker. thank you. the speaker pro tempore: the gentleman's time has expired. the gentleman from texas. mr. sessions: i reserve my time. the speaker pro tempore: the gentleman from colorado. mr. polis: thank you, mr. speaker. i'd like to yield one minute to the gentleman from ohio, mr. ryan. the speaker pro tempore: the gentleman from ohio is recognized for one minute. mr. ryan: i thank the gentleman.
i'd just like to build on a point that the gentleman from new jersey was making. we need investments into our economy. this is an opportunity for us to get private investments into our economy. and the gentleman from california was talking about 96% of the globe is outside of the united states. what's happening now with the currency man national park plays is china is art -- with the currency manipulation is china is making its currency artificially cheaper to ship them to the united states and because of that our products trying to go to china are more expensive. we had dozens and dozens and dozens of republicans volt for this last year at the end of the session. the senate has passed this. this is a simple measure where we can send a signal to the country and to the world that if we play fairly with china and china plays fairly with us, we all can benefit. and that will drive investment back into the united states and manufacturing. we had two cases at the international trade commission on tires and steel tubing.
in which china was cheating. the americans, we put tariffs on these products. we saw job creation come, over $2 billion worth in the steel tubing industry of investments that have been made since that decision. we have seen tire manufacturers expand in places in northwestern ohio. so if we level off the playing field with these guys, we can compete with transportation costs going up. we can compete. we have the productivity, we have the work force. we just need a level playing field. so i ask, mr. speaker, that this congress, this house of representatives, brings this bill up and let's make some progress with china and set the tone and reclaim the mantle for manufacturing here in the united states. yield back. the speaker pro tempore: the gentleman's time has expired. the gentleman from texas. mr. sessions: thank you very much, mr. speaker. at this time i'd like to engage the gentleman from colorado and advise him that i have no more additional speakers other than myself to close and i would
reserve my time. the speaker pro tempore: the gentleman from colorado. mr. polis: i believe we are on our last speaker. i would like to yield 1 1/2 minutes to the gentleman from mape, mr. michaud. the speaker pro tempore: the gentleman from maine is recognized for a minute and a half. mr. michaud: i thank my friend for yielding me a minute and a half. more than three weeks ago the senate passed bipartisan legislation to address china currency manipulation. since then the census bureau reported that the u.s. trade deficit with china set a new record at $28.96 billion in august. but house leadership still refuses to bring to the floor bipartisan legislation that would withdraw on the nuance illegal, under evaluation. the consequences of china's unchecked currency manipulation will only get worse. china is literally robbing us of
our factories, of our manufacturing jobs, and we aren't doing a thing about it. addressing china's currency manipulation would create at least one million jobs without costing the american taxpayer a penny. that is why congress has to bring the currency reform for fair trade act to the floor immediately. that's what we are trying to do here today. i urge my colleagues to vote no on the previous question and yes on getting tough on china. i yield back the balance of my time. the speaker pro tempore: the gentleman's time has expired. the gentleman from texas. mr. sessions: thank you, mr. speaker. mr. speaker, congress has an opportunity today to unleash investors and american business for the benefit of capital formation in america for american companies and jobs. additionally we have an opportunity because we have worked so well together, there is joint agreement to ensure the safety and soundness of financial institutions in the
united states. with this legislation. reforms the company investor relations are long overdue. long overdue that would reform the industry to make them better, stronger, to add jobs may i add. congress should be doing everything we can do to help economic growth and development, to jump-start the free enterprise system and put americans back to work. that happens through capital formation. growing our economy and slowing federal spending will be the best way to get this government back with the economy back on track and getting out of rising debt and deficit that is facing this great nation. the underlying bills provide necessary steps today for doing just that. i applaud my colleagues, the gentleman, mr. mchenry, the gentleman, mr. mccarthy, for introducing the bills we are discussing here today. particularly i'm proud of my
committee, committee i have served on for 14 years, the rules committee, under the leadership of the gentleman from california, dave dreier, making sure he saw the bill, the power for investment, capital formation, jobs, but also included ideas. ideas from both sides of the aisle. equally if submitted, were given not only consideration but the agreement, the green light to come on the floor today to make sure that what we did we did together. to make sure that we speak for the voice that's very powerful about the need for us to ensure america's greatest days lie in our future through the free enterprise system. i am proud of what we have done here today. and i reserve my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from colorado. mr. polis: thank you, mr. speaker. i want to inform the gentleman from texas--one additional speaker emerged and i would be honored to yield 1 1/2 minutes to the gentleman from washington. the speaker pro tempore: the gentleman from washington is
recognized for 1 1/2 minutes. without objection. mr. mcdermott: i agree with the gentleman from texas. we ought to be doing everything we can for american workers. and the time has come for this house to vote on the currency reform for fair trade act. my friends across the aisle need to stop standing in the way of american jobs. it's time to act. we have been discussing this issue with the government of china for more than eight years. and this republican majority has done not one blessed thing. american manufacturers should not be forced to compete against a 28% discount on imports from china due to china's predatory currency practicings. this legislation will give meaningful relief to u.s. companies and workers who are hurt by china's currency manipulation. this is a bipartisan measure.
amazing. this passed the house last year with an overwhelming vote including a strong majority of republicans. of course that was last year. the majority of the house this year, 230 members, have co-sponsored this bill including 62 republicans. a similar bill passed the senate by a large bipartisan vote. american workers expect every one of us on both sides of the aisle to fight against china's predatory trade practices and to fight for american workers. the question you have to ask yourself, mr. speaker, is, how long are we going to have to wait for a jobs bill to come from the republican side? it seems like it may never happen until after the election of 2012. the speaker pro tempore: the gentleman's time has expired. the gentleman from texas. mr. sessions: thank you, mr. speaker. as i had earlier indicated i saw
the gentleman from colorado had one more speaker so i consumed my time. i reserve the balance of my time. the speaker pro tempore: the gentleman from colorado. mr. polis: thank you. i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. polis: thank you, mr. speaker. the bills before us do something for people of all economic classes in the country. they help working families and the poor. they are good for the middle class. and they are good for millionaires. let me talk about each group and how it helps. first, millionaires. it gives millionaires more ways to lose their money. isn't that exciting? previously, again, you not only had to be a millionaire, you had to a millionaire with the right connections to network to a company with private offering. otherwise you don't find out about it. this would put all millionaires on equal footing. have them presented to them under the access for capital job creators act and alaw them to squander their money on
start-ups and occasionally reap a reward. it's money that's invested that will create jobs. it will help fund the companies and get them off the ground. giving millionaires many more ways to lose their money through investing in risky start-up companies. what does this do for the middle class? again, it gives the middle class more ways to risk their money and lose it as well. previously a middle class family, the average net worth in this country was about $100,000. they were unable to invest in a start-up company. they couldn't lose their money that way. they could go to las vegas. they could bet it all on number six. lose it there. they could respond to a full age ad in a paper and buy gold with their money. that doesn't create jobs. but, no, they couldn't invest it in their neighbor's start-up company. this bill remedies that. limits their losses. allows them to invest 10% of their income. they make $80,000 a year. they can invest $8,000 in a risky start-up company. again nine out of 10 of these
will go out of which is. they lose their money. maybe one out of 10 they'll make a lot of money. this allows middle class families the same opportunities that millionaires have always had to lose their money. what does it do for working families and american poor? access to capital. what if you have an idea? what if you don't have any net worth but great idea? you need to raise $100,000, $300,000. the proverbial better mousetrap. you might not know any fancy venture capitalist, you might not know people with money, but you no he what bill allows to you do, allows you to put it up on the internet and raise money from small investors across the country legally. there was no legal way to do that until this bill passes. there is no legal way for somebody without access to capital to raise capital in stralltraunches without occurring oversight and hiring lawyers. this effectively allows working american families to raise money for their ideas by crowd sourcing or raising money over the internet. from that newly franchised
middle class that now has the ability to lose their money in new ways and the millionaires who have always been able to lose their money but only if they knew the right people. so these bills allow new avenues for growth capital for start-up companies. again to be clear, most of these companies aren't going to work out. that's the nature of capital i am. most are going to go out of business. they might employ three people for a year, two years down the road. there will be a footnote. you know what? some of them are going to work out. we could see the next google, next yahoo!, next microsoft. many of these companies started as garage companies, funded by proverbial friends and family, the next great american success story can be funded by crowd sourcing, could have thousands of investors from middle class families across the country earning millions of dollars on their investment and limiting their losses to 10% of their income. . i am proud to pour these two bills and appreciative of the majority and minority staffs for expediting their passage and moving them through
committee and through the amendment process. it's time we get back to work for the american people. i again call on the speaker and my republican colleagues to put aside partisanship and give us more bills like these and more bills that can contribute to robust job growth and do something for all american families regardless of their economic worth. mr. speaker, i oppose the previous question and i ask unanimous consent to insert the text of the aforementioned amendment in the record along with extraneous material immediately prior to the vote on the previous question. the speaker pro tempore: without objection. mr. polis: again, i'd like to point out, i will be opposing the previous question on the underlying issue i don't necessarily agree with what some of my colleagues have said with regard to china and voted consistently with that in the last congress and this congress but i do believe that the congress should be able to work its will on this important matter to the american people and with regard to international relations. there are bigger fish to fry than giving millionaires more ways to lose their money and giving middle class families more ways to lose their money
and giving access to capital but these are important steps forward for capitalism and capital formation and to create the next generation of great american companies that will lift us from this recession and carry forward the torch of american progress across the world. i'm honored to support both underlying bills, hope that they move to immediate passage in the senate as well, and i yield back the balance of my time. the speaker pro tempore: the gentleman yields back the balance of his time. the gentleman from texas. mr. sessions: mr. speaker, it's a rare day, rare day when members of the rules committee from opposing parties have a chance to do so well with each other on the floor. once again i'd like to congratulate the gentleman on being a new father. we celebrated this with the pictures at the rules committee just yesterday. i encourage a yes vote on the rule and i move the previous question on the resolution. the speaker pro tempore: the previous question has been moved. the question is on ordering the
previous question on the resolution. those in favor say aye. those opposed, no. in the opinion of the chair, the ayes have it. mr. polis: mr. speaker. the speaker pro tempore: the gentleman from colorado. mr. polis: on that i request the yeas and nays. the speaker pro tempore: the yeas and nays are requested. those favoring a vote by the yeas and nays will rise and remain standing until counted. a sufficient number having arisen, the yeas and nays are ordered. members will record their votes by electronic device. pursuant to clause 8 and clause 9 of rule 20, this 15-minute vote on ordering the previous question will be followed by five-minute votes on adoption of house resolution 453 if order and the motion to instruct on h.r. 2112. this is a 15-minute vote. [captioning made possible by the national captioning institute, inc., in cooperation with the united states house of representatives. any use of the closed-captioned coverage of the house proceedings for political or commercial purposes is expressly prohibited by the u.s. house of representatives.]
the speaker pro tempore: the yeas are 241. the nays are 184. the previous question is ordered. the question is on adoption of the resolution. those in favor signify by saying aye. those opposed, no. in the opinion of the chair, the ayes have it. the resolution is adopted. without objection, the motion to reconsider is laid upon the table. the unfinished business is the vote on the motion to instruct on h.r. 2112 offered by the gentleman from washington, mr. dicks, on which the yeas and nays were ordered. the clerk will redesignate the resolution. the clerk: motion to instruct conferees offered by mr. dicks of washington. the speaker pro tempore: the question is on the motion to instruct. members will record their votes by electronic device. this will be a five-minute vote. [captioning made possible by the national captioning institute, inc., in cooperation with the united states house of representatives. any use of the closed-captioned coverage of the house proceedings for political or
reconsider is laid on the table. without objection, the chair appoints the following conferees on h.r. 2112. the clerk: messrs. rogers of kentucky, lewis of california, wolf, kingston, latham, aderholt. mrs. emerson. messrs. col burrson, bonner, latourette, dicks. ms. delauro. messrs. oliver, pastor of arizona, farr, fattah, schiff. -- fatah, schiff.
the speaker pro tempore: the chair lays before the house the following enrolled bill. the clerk: senate 1280, an act to amend the peace corps act to require sexual assault risk reduction and response training, the development of a sexual assault policy, the establishment of an office of victim advocacy, the establishment of a sexual assault advisory council and for other purposes.
the speaker pro tempore: for what purpose does the gentleman from alabama seek recognition? mr. bachus: thank you. mr. speaker, i ask unanimous consent that all members may have five legislative days to revise and extend their remarks on h.r. 2940 and insert extraneous material therein. the speaker pro tempore: without objection, so ordered. for what purpose does the gentleman from alabama seek recognition? mr. bachus: pursuant to the rule, just adopted, i call up the bill h.r. 2940. the speaker pro tempore: the
clerk will report the title of the bill. the clerk: union calendar number 176, h.r. 2940, a bill to direct the securities and exchange commission commission to elimb mate the prohibition against general solicitation as a requirement for certain exemption under regular hation d -- regulation d. the speaker pro tempore: pursuant to house resolution 453, the amendment in the nature of a substitute recommended by the committee on financial services printed in the bill is adopted. the bill, as amended, is considered as read. after one hour of debate, as amended, it shall be in order to consider the further amendment printed in part b of house report 112-265, if offered by the gentleman from north carolina, mr. miller, or his designee, which shall be considered as read and shall be separately debatable for 10 minutes equally divided and controlled by a proponent and an opponent. the gentleman from alabama, mr. bachus, and the gentlelady from california, ms. waters, each will control 30 minutes. the chair recognizes the gentleman from alabama. mr. bachus: thank you. mr. speaker, i yield myself
such time as i may consume. the speaker pro tempore: the gentleman is recognized. the gentleman will suspend. the house will be in order. members, please take their conversations off the floor. the gentleman from alabama. mr. bachus: thank you, mr. speaker. mr. speaker, i rise today in strong support of h.r. 2940, the access to capital for job creators act. throughout this week, the house is considering several jobs bills that are sponsored by members of the financial services committee and that have recently been approved by the committee. they have been sponsored by both republicans and democrats. yesterday, we passed two of those bills overwhelmingly, and today we will consider the
other two. presently, we're considered h.r. 2940 which was introduced by mr. mccarthy, a member of the committee, and of leadership. what this bill does is creates jobs. it gives entrepreneurs the ability to raise capital and that capital translates into jobs. the president in his state of the union called on the congress to create ways, additional ways, alternative ways for entrepreneurs to raise capital. he also called on congress to address burdensome regulations and restrictions imposed on american businesses who create american jobs, and that's what brings us on the floor today. i received a letter last week
from emanuel cleaver, a member of our committee, who voted in favor of all four of these bills in committee. and this is what he said, and this is what i think are doing today. as we attempt to breach the divide in congress, i want to share an inciteful civility story. two young boys went to a neighborhood park to have some play time before their respective mothers called on them for dinner. but upon arriving, a controversial ensued. one boy said, let's play on the see saw. no, the other replied. i want to play catch. one boy got on the see saw. but because no one sat on the other end, he never got off the ground. the other boy threw the ball but no one threw it back. that sounds a lot like the two sides in congress. both sides have come to washington for the same purpose but with different priorities.
as representatives of the people, the greatest nation on earth, we must be willing to alter one preference in order to acquire another, often resulting in an accommodation of both. it was signed by my colleague, emanuel cleaver. member of congress from missouri. and that's why we're here today. we're here today to set aside our differences and do what the american people have asked us to do and that's create jobs. now, i can't think of a better way to create jobs, particularly for small and middle sized businesses than mr. mccarthy's legislation. and i'm happy to report that the democratic members of the financial services overwhelmingly agreed with us. yesterday, the job numbers came out and it showed that while large corporations actually lost 1,000 jobs last month, small and
medium-sized businesses created 107,000 jobs, or 108,000 jobs. they did that despite what was described as restrictions. the greatest restriction was the lack of capital. there are two ways to obtain funds needed to hire new employees. one is to go to the bank and borrow it. anyone on the financial services committee will tell you that when entrepreneurs go to the bank to get a loan for their business, they're often told, i'm sorry, it's too risky. there is an alternative to loans and we all know loans can be hard to come by for new businesses and for small businesses who create almost all the new innovation an jobs in our country. the other way is to attract
capital, people willing to invest and have the opportunity to shear in the profits an share in the growth of that company but at the same time willing to take the risk. that's what mr. mccarthy's bill does in a nutshell. it makes it easier for people to invest in companies. we've often said that in america, one of the dreams, and we've had a difficult time with this recently, is home ownership. another is to own a business or invest in a business that does well. how many of us have thought, i wish we had invested in apple? i wish we'd invested in google? i wish we'd gotten in on the ground floor. mr. mccarthy's bill allows investors to get in on the ground floor without having to spend $200,000 or $300,000 to the securities exchange commission and put their money that they have earned, not the
government, to work. when i comes to investing our money, i'll trust individual investors every time over the government. with that, mr. speaker, i reserve the balance of my time. sproy the gentleman reserves -- the speaker pro tempore: the gentleman reserves his time of the gentlelady from california. ms. waters: did you recognize me? the speaker pro tempore: the gentlelady is recognized. ms. waters sprk thank you very much, mr. chairman. i yield myself such time as i may consume. the speaker pro tempore: the gentlelady is recognized. ms. waters: i rise today in support of h r. 2940, the access to capital for job creators act. before i begin my remarks, i would like to thank chairman baucus, chairman garrett, congressman mccarthy and ranking member frank for their assistance and support over this bill.
we were able to work in a bipartisan manner on this bill in our committee, passing it on a voice vote. h.r. 2940 amends the securities act of 1933 to remove the prohibition on general solicitation or general advertising for offers of securities made under rule 506 of regulation d. if those securities are only sold to accredited investors. in other words, investors will be able to advertise their private, unregistered securities offerings, if those securities are only sold to accredited investors. as you know, accredited investors are individuals, companies, or organizations that generally have sophistication needed to make complex financial decisions. these folks are thought to need less protection than average
retail investors. because this lifting of the ban on general solicitation and advertising would only apply when securities were sold to accredited investors, i am sympathetic to the goals of representative mccarthy's bill. the current ban on general advertising has been interpreted to mean that companies can only raise capital from investors with whom they have had a pre-existing relationship. this requirement would hamper their ability to obtain capital and it's therefore appropriate to modernize this provision. however, during the hearing on this bill in september, the north american securities administration -- administrators association and others noted that one problem with the original bill was that it would be difficult to limit the sale of these securities to only
accredited investors when insurers advertise to everyone, marleauly since accredited investors were able to self-certify their status. an amendment i offered in subcommittee, which was accepted, directs the s.e.c. to write rules requiring insurers to verify that purchasers are accredited investors. i think this will substantially improve the potential fraud issues identified by the state regulators. given this improvement, i'd like to offer my support for this legislation this bill will make it just a bit easier for some companies to raise funds in the private market, enabling them to grow their businesses. but make no mistake. i believe that we still need to pass the american jobs act in order to truly get people back to work in this nation. in addition, -- in addition to this small change to enable
capital formation, we need to keep teachers, police officers, and firefighters on the job. extend unemployment insurance for laid off workers, an revitalize neighborhoods devastated by foreclosures. a truly comprehensive approach is needed to get americans working again. i hope my colleagues are willing to work with me on passing the american jobs act. with that, mr. chairman, i reserve the balance of my time. the speaker pro tempore: the gentlelady reserves her time. the gentleman from california. >> i yield myself such time as may consume. the speaker pro tempore: the gentleman is recognized. >> mr. speaker, as many know on this floor, i started before i was in congress as a small business owner. at the age of 20, tiing some savings i had, some luck with the lottery and investments in the market and i took a riskism
went out and opened a le after myself. mr. mccarthy: as i took that risk you find the challenges of a small business. fortunately, i was successful, able to hire people. able to work through. in the end of two years, i had enough money to pay my way through college. but when i think back to those days an the risk i took, i wonder if in today's environment, could i do the same? unfortunately, the answer is no, i could not. i cringe at the thought of today, the regulations, the challenges that small businesses face. when i look at what small businesses do to this economy. they represent 99.7% of all employers. when you analyze -- analyze the growth of america, and you want to take if the beginning of the last recession, 2001, the end of it, to the beginning of this one in 2007 and look at that time in
america when we had job growth, when you think about who created that growth, small businesses added seven million jobs. large corporations cut one million jobs in that same time. today, when we look at the market, we are at an all-time low in the last 16 years for new small businesses entering and all statistics tell us we will not grow unless small businesses grow. unfortunately, the entrance to market has become too great. the regulations have been too tough and the access to capital has been too hard to get. so just as that story i tell you of starting my own small business, when it became successful, before i sold it, i looked to expand. i had dreams of putting five new deles throughout my town. i even started negotiating on a new lease. but to raise that extra capital, a bank had turned me down, but because of regulations by the
federal government, i could only talk to those people i already had a relationship with. i came from a side of town that didn't have great wealth. i didn't know people with money. so for me to be able to talk to them, i'd have to hire an attorney, file with the s.e.c., all things that i did not have the time to do as a small business, even to talk to somebody about the idea. so i ended up selling. that law was based in 1933. this country has moved forward this congress should move forward as well. that's why today, that's exactly what this bill will do. it will allow the small business to unshackle the capital which it needs. it will allow the individual to talk to those who are accredited and it has the protections to do that. the idea could actually gain the capital. and you have to think when you're in a small business, sometime this is capital is better than going to a bank. it's what you negotiate. the cash flow is very important
in a small business. a bank makes you pay monthly. the investment of an individual in allows you to have growth. it also allows americans to invest in america. it is a win-win all the way around. it is involving in a place that allows small business to grow. i will tell you that the strength from the amendment from maxine waters and the adoption in the committee requires insurers to verify that purchases are in fact s.e.c. accredited and i thank you for that amendment. this was approved in the financial service committee by a bipartisan vote. this is another example of ap issue where we can find common ground, work on both sides of the aisle, work with this president, but more importantly, let america start working again. mr. speaker, i urge all my colleagues to support this common sense legislation an i reserve the balance of my time. the speaker pro tempore: without objection the gentleman from california will control the
remaining time on the bill. the gentlelady from california. ms. waters: thank you very much. i yield to the gentlelady from new york three minutes. the speaker pro tempore: the gentlelady is recognized for three minutes. mrs. maloney: i thank my friend and ranking member on the subcommittee ms. waters for her leadership on this bill, for her efforts to make a good product, an even better one. i thank our ranking member, mr. frank, for his leadership on dodd frank and in the committee now and also chairman bachus, chairman garrett and representative mccarthy. this was a bipartisan effort. so in a congress that everyone says we're not working together, this is one example where we worked together in the best sense of the word to bring this bill to the floor. i rise in strong support of the access to capital for job creators act because i believe that it will help businesses in our country raise money they need to create jobs an help our economy recover.
this is an important bill for businesses across our country but it is marleauly important to new york city, new york city is the home of many innovators, invasions, entrepreneurs come there from across the country. this bill will help them raise money an grow the american dream and help them go up that ladder of success in providing jobs and helping our economy. under our current system, companies seeking to raise capital by selling shares are barred from any type -- from many types of advertising and solicitation. in effect, our current system tells businesses go out and create jobs but don't tell people who might want to -- want to invest in your company or invest in your idea or invest in america, don't tell them anything. so this message is contradictory at best and patently unfair at
worst and is bad for businesses at a time when we were asking businesses across this country to lead our economic recovery and to create jobs. this bill before us today would end this contradiction by removing the restrictions on general solicitation an advertising for certain private securities offerings. it will help companies attract potential investors and raise the capital that they need to be successful. and this bill accomplishes this task in a balanced way. during the committee markup and work on this bill, we incorporated numerous ideas from both sides of the aisle including a provision requiring that issuers verify that an investor is actually eligible to purchase the offered securities, the waters amendment made sure that the investors were credible. and accredited. today, as it stands, investors only self-certify that they have
$ million in assets or make $200,000 a year to qualify to purchase the private security. now with this bill we have additional safeguards in place to make sure that investors are qualified and these financial transactions are safer. i support this bill today, i urge my colleagues to join in supporting it. and i feel that this is really an investment in the american dream. i hope that we can likewise work together to pass the american jobs act in a bipartisan way. we are not going to cut our way to prosperity. we need to invest and grow our economy. this bill helps us to do that. the american jobs act does too. and i hope our colleagues will join us in supporting that important job creator nearbytive also. so this is a vote for the american dream i'm proud to support it and i yield back the balance of my time.
the speaker pro tempore: the gentlelady yields back. the gentleman from california. mr. mccarthy: i yield two minutes to a doctor, a mother, a businesswoman who brings a fresh perspective to the freshman class and knows firsthand the chams job creators face, the gentlelady from new york's 19th district. the speaker pro tempore: the gentlelady is recognized for two minutes. ms. hayworth: i had the privilege of coming to the floor and sharing a letter from one of my constituents, mr. paul manahan, and this is what he wrote. we don't need or want more government spending. cut regulations. cut tacks. repeal the 2010 health care law and let business what it does best, create jobs based upon demand, not government dictates spending at attempts to market manipulation. and today in this bill, the access to capital for job creators act, h.r. 2940, we are
taking yet another tep toward implementing this kind of advice from a commonsense american. small businesses, as many of us have already mentioned but they really are the job creators and the key to a healthy and strong economy, our number one priority in this congress is to ensure that the regulatory environment for small businesses supports capital formation, investment and job creation. this bill does exactly that, furthering job creation by eliminating unnecessary regulations. the access to capital for job creators act creates jobs by eliminating a prohibition on solicitation that is a barrier to capital formation and job creation, and regulations that are unnecessary in this case are being eliminated because investors under regulation d have to be accredited. so there's the common sense. this is a win all the way
around. i'm very proud to co-sponsor this important piece of legislation and i am so glad to join colleagues on both sides of the aisle supporting this bill. i want to make mention of the fact that this bill now joins 15 other bills that have been supported by both democrats and republicans. they are listed on a card that we're carrying with us and you've probably seen quite a bit. i want the senate to know that this support from both sides indicates how strongly we are committed to creating jobs and our nation cannot wait for the senate to hold yet this one hostage as well. so i urge its swift passage and thank you, mr. chairman. the speaker pro tempore: the gentlelady's time has expired. the gentlelady from california. ms. waters: i continue to yield to myself such time as i may consume. the speaker pro tempore: the gentlelady is recognized. ms. waters: thank you very much, mr. chairman and members. i'm very pleased we have
bipartisan support for this legislation. it has been stated over and over again that access to capital is extremely important to our businesses and small businesses in particular. mr. chairman and members, we talk a lot about our support for small businesses, but i know there's a long way to go in order to make sure that we have not only access to capital but we have one-stop shops and other kinds of efforts that will help them not only to grow their businesses and expand their businesses but to hire people, and really that's what this is all about. this is about how do we stimulate our economy, how do we get it working, how do we create jobs. this is one way that we can do this, and while we are talking about small businesses, let me remind you that in the american
jobs act that is being debated by this congress, we have similar efforts for small businesses. we have tax credits for small businesses. we have tax credits when they hire workers, when they hire veterans, and so i'm very pleased that both sides of the aisle, we're showing more and more support. these small businesses need this capital to acquire inventory. many of them need to get up to speed with their computer equipment to be able to market their goods, their services and products. and so as we do this, let us keep in mind this is one aspect of how we stimulate the economy, how we grow our small businesses, how we give support to them. but let's look at the other ways that we're talking about doing. don't forget, many small businesses will benefit from the repair of our infrastructure.
just think about it. when we are repairing our roads and our bridges and our water systems, small business persons will have many opportunities to grow their businesses, whether they are wholesalers and people in the middle who will be providing supplies and materials to those contractors or whether or not they are subcontracting for some aspect of this development and growth and repair of our infrastructure. so we are on the right frack here when we talk about assistance to small businesses and job creation, but let us open up our minds and really think about how the infrastructure repair will certainly be a big boom for small businesses. i can point to other things in the american jobs act. just think about the construction and repair of our schools. we have schools that still need a lot of repair. they don't have science labs.
the laboratories and much of what is involved in the whole construction of schools is very much needed, and so, again, our small businesses will benefit from this. just think about it. when they go to their local boards of education and they get involved in supplying goods and services as we repair these schools and build more schools, that's how you stimulate the economy. you cannot separate small businesses from jobs. small businesses create jobs. jobs allow people the ability to spend money and to stimulate our economy. so i'm just so pleased that we see bipartisan support and the efforts for small businesses. let's not stop here. let's keep going. let's keep creating these opportunities so that we can say that we are a country that not only respects small businesses but we're going to
put our money where our mouths are and we're going to give them the opportunity again to create and grow and expand. and with that, mr. chairman, i have no further requests for time, and i will yield back the balance of my time. the speaker pro tempore: the gentlelady yields back her time. the gentleman from california. mr. mccarthy: mr. speaker, i yield two minutes to an integral part of the financial services committee who ran one of the oldest path management companies in the country and has personally faced many of the challenges confronting small business today, the gentleman from illinois. the speaker pro tempore: the gentleman from illinois is recognized for two minutes. >> thank you, mr. speaker. i certainly want to thank the gentleman from california for yielding the time. and one thing that i am very pleased about today is we are talking about some bipartisan legislation, that it does focus on the number one issue that we face in our country today and that's jobs and the economy. mr. dold: as a small business owner i can personally understand that access to capital is critical and sometimes determining the factor between success and failure for small businesses.
small businesses do represent 2/3 of all net new jobs created in our nation. businesses, especially small businesses, must raise capital to create and maintain jobs. to invest in research and development, to sell and market goods and services and generally to expand their businesses. debt financing is very difficult and sometimes impossible in today's market, especially for smaller businesses like my own. equity financing is also very difficult with enormous transaction costs and very expensive and time-consuming s.e.c. regulation requirements. our capital market is struggle and expense of for small businesses, and so we need to find creative ways to reduce the regulatory costs and burdens. this legislation, this commonsense legislation, i would add, would do just that. it would give companies greater access to capital to create
jobs while still protecting the less sophisticated investors at no cost to the american taxpayers. specifically, this bill removes the ban on small companies from soliciting equity financing from accredited investors. it expands the pool of those we can go out to to help raise dollars, to help raise resources so we can invest in our businesses so we can grow them. there are 29 million small businesses in our nation. if we can create an environment here in washington where half of those businesses can create a single job, think about where we'd be then. this is the kind of bipartisan legislation we talk about jobs and the economy. we argue things in the united states congress. i certainly want to thank the gentlelady from california for her leadership. i want to thank the chairman bachus for his leadership. certainly want to thank chairman garrett because this is the kind of legislation, bipartisan legislation that we can get our economy moving again and focus back on jobs. with that i yield back. the speaker pro tempore: the gentleman's time has expired. the gentleman from california.
mr. mccarthy: mr. speaker, i'm pleased to yield one minute to a man who knows what it takes to create jobs and meet a payroll. having spent 20 years building a real estate development company that started with his brothers and sisters, the gentleman from texas, mr. canseco. the speaker pro tempore: the gentleman from texas is recognized for one minute. mr. canseco: mr. speaker, i rise in support of the access to capital for job creators act , and i want to thank the gentleman from california, mr. mccarthy, and the gentlelady from california, ms. waters, for this bipartisan effort as well as our leadership on the committee. as a nation we have an unemployment rate that is hovering around 9% and 14 million americans out of work. we've had 32 consecutive months with unemployment rates at or above 8%, yet senator harry reid, the majority leader, insists it's very clear that private sector jobs have been doing fine. the american people disagree. i'm 62 years old and a freshman in this the people's house. before coming to congress i
spent my entire career in the private sector. i've signed the front of a paycheck. i know something about how to create jobs. what i know is that attempting to spend our way to an economic recovery won't work, and we have the economy today that proves just that. from the experiences gained from an almost 40-year career in private business to get the private sector creating jobs again and our economy growing, government needs to get out of the way and not be an impediment to job creation. this is the philosophy that has governed bill after bill that the house has passed to get our economy moving again, and unfortunately these bills are rotting at the doorstep of the senate as harry reid refuses to allow -- the speaker pro tempore: the time of the gentleman has expired. mr. canseco: i thank the gentleman from california. mr. mccarthy: it's now my -- i yield to the gentleman from new
jersey, mr. garrett. the speaker pro tempore: the gentleman from new jersey is recognized for two minutes. mr. garrett: i thank the gentleman. i thank the gentleman from california for his leadership as well on this issue as well as others and behind us over here, the chairman of the full committee, spencer bachus, for his leadership on this issue and doing what we can do best in order to facilitate the greater and liquidity and openness and credit in the marketplace and this bill is one step in that direction. i thank the gentlemen for their efforts in that regard. i was on the floor in the last few days now and i heard members on the other side of the aisle repeatedly come to the floor saying, where are the jobs bills? we haven't had any jobs bills come through. well, here is certainly one of the pinnacles of the jobs bills we have been talking about that this house has passed already and today we will pass going forward. what this bill will do is provide, as already indicated to small and big businesses to
get the wherewithal to get their business, expand their business and to do what after that, create jobs, and that's what this is all about. we just had a litany of people come to the floor. one right after the other just as the sponsor of the bill had. someone that got some capital outside of that as well and do what, create a business and it wasn't a one-man operation, i'm sure. he then brought people into that business. he created jobs. the other speakers who came to this floor as well, they created jobs. this bill, as the other side of the aisle has indicated, recognizes this bill will create jobs. now, one of the other things this bill does is to create certainty in the marketplace, something that has been a problem over the last couple of years with all of the legislation and regulation that has been coming out of washington. this will provide some degree of certainty in the marketplace so that investors and business owners will understand how they can get into the credit
marketplace and do so. now, i know a little bit later from now we may see some attempts to amend this bill and would go in just the opposite direction. what would it do? it would provide more uncertainty into the marketplace. it would provide more convolution to the system and make it even more difficult to do what we're trying to do today, so i say, support this bill. clean as it right now to create more jobs for the american public. the speaker pro tempore: the time of the gentleman has expired. the gentleman from california. mr. mccarthy: mr. speaker, i now yield one minute to the former chairman of the small business committee who's never stopped working to create good-paying jobs for northern illinois. the speaker pro tempore: the gentleman from illinois is recognized for one minute. >> mr. speaker, i hear complaints from our small business constituents back home about the difficulty in raising capital. today we have an opportunity to fix one aspect of this problem so that our nation's small businesses can obtain the funds that they need to hire workers. current law bars companies from raising capital through unsolicited advertisements,
requiring potential investors to have an existing relationship with a particular company, limits the pool of investors and hampers the efforts of small companies who have a good idea to raise much-needed capital to expand and hire workers. mr. manzullo: this bill would make an exemption for the advertisement ban. h.r. 2940 will make it easier for companies to raise capital without putting less sophisticated investors at risk. as former chairman of the small business committee, i urge my colleagues to support h.r. 2940, the bill would help small gazelle firms raise capital during these difficult economic times. . the speaker pro tempore: the gentleman's time has expire. the gentleman from california. mr. mccarthy: i yield two minutes to the gentleman from ohio mr. stivers. the speaker pro tempore: the gentleman is recognized for one
minute. mr. stivers: i would like to thank the gentleman for yielding me time. i want to voice my support for the access to capital and job creators act. this is straightforward legislation that provides a simple method for job creators to provide funding for their businesses. it will allow entrepreneurs to advertise their investment opportunity to accredited investors to solicit their investment without being subject to costly and burdensome regulations. this exemption would only apply to general sliss takes or advertising if the buyers are accredited investorsering those people that have $1 million net worth or have a $200,000 income. this leaves protections in place for those who may be less sophisticated investors. this bill helps finance job growth by connecting small businesses and job job creators with sophisticated investors while keeping protection for less sophisticated investors. the speaker pro tempore: the gentleman from california.
mr. mccarthy: i yield one minute to the gentleman from butler, pennsylvania, mr. kelly. the speaker pro tempore: the gentleman is recognized for one minute. mr. kelly: i rise in strong support of this piece of legislation. this is so common sense, so basic. it is as basic as blood is to the body. the access to capital for small businesses, the ability to raise capital in hard times the biggest inhibitor to us create jobs jobs is the uncertainty. for anyone to go to a bank and say, need to borrow money, i need to buy kimmitt, they're met with, we aren't sure we can do that. we need access to that capital if we are to succeed, if we are to move forward as a country, we need to unleash the bonds that are keeping us moribund. this is the same as blood to the body. access of capital to small
business, must be den now, great borne support on it. i yield back. the speaker pro tempore: the gentleman from california. mr. mccarthy: it is my pleasure to yield one minute to the members whose top priority in washington is getting the granite staters bark to work, the gentleman from new hampshire. the speaker pro tempore: the gentleman is recognized for one minute. mr. gun ta: one thing we -- mr. guinta: one thing we can do as a body is bring bills to this floor as asked. the leadership that mr. mccarthy and ms. waters have demonstrated is an opportunity for this company to get greater access to capital to get innovators and job creators the ability to hire quicker. for those like our own dean cayman, to continue to find the next revolutionary way to change
our state and our nation. this is a great opportunity for us to reform an old piece of legislation going back to 1933, update it to make sure it's required required standards of 2011 for the new job creators of tomorrow. i'm thrilled to support it and i look fwar to more job creation bills that come to this floor for us to vote on and get our country moving in the right direction. i yield back. sproy the gentleman from california. mr. mccarthy: this bill represents an important step toward up leashing the possibilities of entrepreneur or small business. an entrepreneur never takes a job from someone, he only creates them. i urge my colleagues to support the underlying bill and i yield back. the speaker pro tempore: all time for debate on the bill has expired. for what purpose does the
gentleman from north carolina seek recognition? >> i have an amendment at the desk. the speaker pro tempore: the clerk will designate the amendment. the clerk: amendment prinned in part b of house report 112-265, offered by mr. miller of north carolina. the speaker pro tempore: pursuant to house resolution 453, the gentleman from north carolina, mr. miller, an a member opposed reach will control five minutes. the chair recognizes the gentleman from north carolina. mr. miller: thank you, mr. speaker. this amendment will require a disclosure that if there are going to be unregulated solicitations, unregulated advertisements asking for investments in these companies that at the very least, that the advertisement or the solicitation should reveal if -- should disclose if there is a compensation agreement with executives or golden parachute severance package and what those are so investors don't find they're buying into a company that if it does make a profit there are contracts in place to
make sure the profs go to executives that are there and not investors. we've heard all manner of golden praise for the kinds of small businesses that might benefit from this bill. i think the gentleman from illinois referred to these as gazelle companies. mr. speaker, there's been a bad history of flimflams that have taken investors' money. the reason we have investor protections is not just because of the self-aggrandizing ambitions of regulators, it's because there's been a history of abuse. that abuse discourages capital from coming. no one wants to invest when there have been well-publicized examples of investors who put their money into unregulated companies like these, like what this bill would create, and lost their entire investment because it all was grabbed by a handful of executives. these disclosures are even more
important because these companies will not be subject to the sale and payrolls under the financial reform legislation pass signed into law just last year. we have already seen if the experience on say on pay that there remain real abuses of executive compensation. even though many companies changed their practices and made them more transparent because they're worried about putting their pay practices to a vote of the shareholdersing they fear disapproval and changed their practices even with that, about 2% a petty big number, get turned down and all get turned down for the same reasons, there's no connection between pay and performance, there are poor pay practice like long-term benefits without any kind of performance measure. there are bonuses that were way too easy to achieve, the par was set very, very low.
there are performance measures that make no sense. or simply full disclosure of what the compensation was or the compensation was too much for the size of the company an what others in the industry are paying. under these companies -- these companies will not have say on pay. they will not get a chance to vote on executive compensation and they might find they have bought into a company that has practices already in place, executive compensation contracts, golden parachute contracts that asewers that even if the company does prove to be profitable, they won't get the benefit of the profits. it will all go to the executives who were selling them investments, encunning them to invest in those companies. these are obviously very, very helpful disclosures, it's important in information for investors and hops small businesses should not hesitate
in the least to provide it. i yield back. the speaker pro tempore: the gentleman from california. mr. mccarthy: i rise to claim time in opposition. the speaker: the gentleman is reck newsed. mr. mccarthy: thank you, mr. speaker. mr. miller's amendment goes against the purpose of this bill. this amendment would force private companies raising capital to face stiffer regulations than public companies regarding compensation. the securities exchange commission doesn't require public companies selling to retail investors to put this in their advertising an even dodd-frank did not go this far. with ms. waters' help we made sure the bill specifically -- specifically targets on sophisticated, accredited investors. the s.e.c. has no authority to regulate the of pay and bonuses of any company. i therefore uverage my
colleagues to reject this amendment and yield one minute to the gentlelady from new york, ann hayward. the speaker pro tempore: the gentlelady is recognized. ms. hayward: i'd like to add to my colleague's comments by noting that shareholders in major public corporations have said over and over again they do not find that the amount of capital that would have to be devoted, the am of resources that would have to be devoted to unusual disclosures about executive compensation yopped what the s.e.c. rules already require make any decisions about investing at all. ms. hayworth: you can expect that accredited investors will not need this kind of adegreesal burden to be placed on companies that clearly they want to see thrive and grow with the precious capital they have. i yield back.
>> mr. speaker. the speaker pro tempore: the purpose of h r. 29 -- mr. mccarthy: the purpose of this bill is to have make investing more available, this amendment does not do that the speaker pro tempore: the gentleman from california. mr. mccarthy: i ask unanimous consent this the of speaker may postpone questions on the amendment by the gentleman. the speaker pro tempore: those in favor of the amendment say aye. those opposed, no. >> i ask for a recorded vote. the speaker pro tempore: the
the speaker pro tempore: for what purpose does the gentleman from north carolina rise? >> mr. speaker, i ask unanimous consent that all members have five legislative days within which to revise and extend their remarks on h.r. 2930 and to insert extraneous materials thereon. the speaker pro tempore: without objection. pursuant to haas rule 453 and rule 18, the chair declares the house in the committee of the whole house on the state of the union for consideration of h. reform 2930. the chair oy points the gentleman mr. bass to preside over the committee of the whole. the chair: the house is in the committee of the whole house on the state of the union for consideration of h.r. 2930 which the clerk will report by title. the clerk: a bill to amend the securities laws to provide for registration exemses for certain crowd-funded securities and for other purposes. the chair: pursuant to the rule, the bill is considered read the first time the gentleman mr.
mchenry and the gentleman -- will each control 30 minutes. mr. mchenry: i yield myself such time as i may consume. when i'm at home in western north carolina, i hear frequently my constituents that they have a difficult time raising capital in these challenging times that we're in. over two years into an economic recovery that is struggling, america's labor and capital markets continue to face unprecedented challenges. nearly 14 million americans remain officially unemployed. . with an additional 11 million underemployed and small businesses continue to struggle to access capital despite an endless number of government initiatives. the original orgein of these barriers to capital formation rests in two major federal securities law. the securities act of 1933 and the securities exchange act of
1934 that have not been substantially updated since a gallon of gasoline cost 10 cents and only 31% of households owned a telephone. today a gallon of gas as we know costs about 35 times more per gallon than it did then and nearly every american owns a telephone. in fact, most people have the internet in their pockets. so while the comparison of then and now is nostalgic, the ramifications of not modernizing our securities regulations have led to registration and reporting requirements so onerous and costly that small companies have great difficulty raising capital. for instance, if a startup company offers an equity stake to investors through a medium like facebook or twitter it is in violation of s.e.c. regulations for that communication and offering.
however, soliciting money for one's favorite charity or even a political candidate through the same internet medium is perfectly legal. so clearly something is not right. furthermore, high net worth individuals can invest in businesses before the average family can, and that small business is limited on the number of the amount of equity stakes they can provide investors and limit in the number of investors they can get. so clearly something has to be done to open these capital markets to the average investor, and that's what the access to capital for job creators act is about. it removes the access funding for crowd funding to allow entrepreneurs and investors to raise capital from everyday investors. already prevalent in europe and asia, crowd funding has proven that broadening the
communication and investment capabilities between investors and entrepreneurs can have a positive impact and a positive effect on capital formation which is the lifeblood of a strong and growing economy. specifically, my bill will allow companies to pool up to $1 million without the expense of registering with the s.e.c. or up to $2 million if the company provides investors with audited financial statements. individual contributors are limited to $10,000 or 10% of the investor's annual income, whichever is less. in addition, h.r. 2930 creates a regulatory structure of investor protection around this new innovative form of financing with substantial intermediary requirements or issued requirements if there is no intermediary. this key mandate for investor protection is why the bill has received broad bipartisan support, both in the financial
services committee and from president obama. this has been crafted both with republican and democrat staffers getting input from my colleagues from across the aisle and a subcommittee markup, multiple hearings that we had on the idea of crowdfunding as well as a full committee markup. and we worked together and passed it with a bipartisan vote coming out of committee. this was a collaborative operation, and i appreciate my colleagues and i appreciate the staff of the financial services committee as well as the staff on the oversight and government reform committee where in my subcommittee we had a number of hearings on capital formation and out of that came this idea. this is a culmination of months of work. the process began for crafting this piece of legislation over the summer, and when the president stood in this hall, in this room just a couple months ago for his jobs bill,
and when he includes that in the proposal, this idea of crowdfunding, it was a very positive thing. not just have a good idea that we can pass here in the house but to have a good idea that has the possibility of getting through the senate where it's a very challenging time for them to pass legislation at all. and that way can make it to the president's desk and really give entrepreneurs the opportunity to raise this capital, to actually help create and grow jobs and that's why they need the capital so we can grow jobs, create jobs and provide more opportunity for our constituents and folks across this country. we can protect and inspire confidence in the investor community as well as allow small businesses, those companies most critical to our economy to gain the capital needed to expand, compete and thrive. i urge my colleagues to support this bill that combines -- that combines both the best of microfinance with the power of
crowdsourcing and give folks the opportunity, the average everyday investor the opportunity to have an equity stake in their favorite company, not just accredited investors, not just the so-called high net worth individuals. that's the purpose of this legislation. i ask my colleagues to support this legislation and i reserve the balance of my time. the chair: the gentleman reserves the balance of his time. the gentleman from california -- colorado, mr. perlmutter. mr. perlmutter: thank you, mr. chairman. i thank my friend from north carolina for bringing this matter to the floor, for being the sponsor of this bill and for working with us to make this bill better. now, as mr. mchenry said, this is a bill that really allows money to be raised, investments to be made by people without a lot of money. they are investors who are going to make smaller investments but in a large volume.
and as my friend said, this isn't 1933 and this isn't 1934 when those acts were passed, but still what we got to remember is sales can be made on the internet now or this bill will be asked to be made of securities made on the internet. originally could have been on the phone, could have been by mail, could have been by word of mouth. but what we have is the ability to raise money across the internet that the proper protections are put into place so that those who might deceive or defraud or in some other way mislead investors who are making these investments can be policed and the laws can be enforced if in fact there is some type of fraudulent act. now, h.r. 2930 enables small companies and individuals to make use of internet-based social networks to raise up to $1 million from friends, family and other interested investors.
while the bill caps both the total level of securities and the amount investors can invest, democrats expressed strong concerns about the potential harm this new market could pose to investors. originally, the bill provided few investor protections and no s.e.c. or state regulatory oversight. during the committee markup of 2930, democrats added provisions requiring crowdfunding, and crowdfunding is a term that really isn't seen in our law to date, and what it is is the sale of securities, the solicitation of vefments across the internet -- investments across the internet in small amounts. so democrats asked that there be notice given to state regulators so that they could police the activities against wrongful conduct, deception,
fraud, embezzlement or other kinds of misdeeds. democrats successfully added a provision to disqualify bad actors, individuals that have been convicted of either state or federal security laws violations. democrats also requested and the gentleman from north carolina and the republicans agreed to create a regulatory framework for the crowdfunding websites that would provide additional disclosures, safeguards and protections for investors who wanted to buy into one of these investments. we recently had a financial crisis that we're still continuing to dig our way out of. there were ponzi schemes. everybody's aware of the madoff ponzi scheme and others. we need to have protection for investors as businesses seek to form and develop capital.
we thank the gentleman from north carolina in working with us to play some of these -- place some of those investor protections into this bill. we know there will be a number of amendments that will be proposed that will strengthen to -- those investor protections. we thank the gentleman from north carolina for bringing this bill forward, and with that i would reserve the balance of my time. the chair: the gentleman from colorado reserves the balance of his time. the gentleman from north carolina. mr. mchenry: i thank the chairman, and i thank my colleague from colorado for working actively with me and with my staff to make this bill better. as well as my colleagues, mrs. mccarthy -- i'm sorry -- mrs. maloney from new york. my apologies. ms. waters of california. mr. green. thank you so much for your work in working in a bipartisan way to improve the bill.
with that i'd like to yield such time as he may consume to the chairman of the financial services committee, the gentleman from alabama, mr. bachus. the chair: the gentleman from alabama is recognized. mr. bachus: thank you, mr. speaker. mr. speaker, i feel like that i'm having a dream and in that dream my colleague, patrick mchenry, has legislation on the floor and president obama has endorsed that legislation. i feel like i ought to wake up and find out that that was a dream, but in reality it's actually what's happening here today. and i told mr. mchenry that i'd like unanimous consent to ask that we call this the mchenry-obama friendship bill, but i won't do that. let me say this, the president did issue a statement yesterday
, and in that statement it says the administration supports house passage of h.r. 2930. it goes on to say -- and the president's september 8 address to the joint session of congress on jobs and the economy, he called for cutting away red tape that prevents many rapidly startup companies for raising needed capital including through crowdfunding exemption from the requirement to register public securities offerings with the securities and exchange commission. and he goes on to say that he believes that this bill will make it much easier for entrepreneurs to raise capital and create jobs. and it will. last night i was at a faith and politics dinner where our friend, congressman steny hoyer, and congressman roy blunt, or senator roy blunt, were receiving the award.
they were receiving the john amos hoton award. as we know those colleagues, they are bridge builders. the gentlemen at the table next to me, and these people were supporting faith and politics, said to me, i appreciate the fact you're going to bring a crowdfunding bill to the floor of the house. and i was somewhat amazed because a few months ago, i have to admit, i'm not a high techy like the president or congressman mchenry, but i really didn't know the difference. and clownfunding and crowdfunding before we started talking about this bill. and i said to him, how do you know about this bill? and he said, well, i'm an executive with facebook. and he said, many companies similar to facebook -- and you
mentioned this in your earlier speech -- and he said they do it here but they avoid the law. they raise money through crowdfunding. and it is a modern thing to do. the like a facebook. it's like google. it's like blackberry several years ago. it's something that we didn't know about, but we do now and we do need to keep our laws current. i do, also, close by commending congressman perlmutter for making this bill a better bill and one that protects consumers. but with this legislation we'll move this provision into the 21st century and bring it up to date with modern ways to finance businesses. and that will give us an advantage that we presently is a disadvantage when it comes to competing with some of our foreign competition. we certainly want to level that playing field and create jobs and this bill does that and i
yield back the balance of my time. the chair: the gentleman yields back the balance of his time. the gentleman from colorado. mr. perlmutter: thank you, madam chair. i just want to for the record h.r. 2930 creates a new exemption from registration under the securities act of 1933-1934. we call it crowdfunding securities. i think the record should have a definition. crowdfunding refers to a technique for raising money over the internet in relatively small amounts from a large number of people. and that's the exemption that's being sought pursuant to this bill. . different way to raise money, i yield to my friend from north carolina. >> i thank my colleague for submitting that for the record, the definition. the intention is you have an internet portal of sorts but this could be done on any mas basis.
mr. mchenry: the disclosures have to be very clear and we've kevin the s.e.c. the ability to specify additional pieces. i have a technical amendment to clarify what the securities and exchange commission staff thinks is important to add to this billism do appreciate the gentleman offering the definition and i yield back. >> i thank the gentleman. one other tell in the bill, intermediary, that's a custodian of funds until -- am i correct or not? i yield back to my friend. mr. mchenry: i appreciate the gentleman. the intention would be that the intermediary is in essence the conduit for funds. there's the notion of the broker-dealer, well-established in law. what this does is create a very -- it's similar to a broker dealer but it's low regulatory,
low cost basis of doing it. what this is, it's an intermediary defined as webster's would define an intermediary. that's probably the better way to describe it. mr. perlmutter: to the degree that the intermediary exists in this, they'll be subject to enforcement principles as we go through the amendments. with that, i yield three minutes to my other friend in north carolina, mr. miller. the speaker pro tempore: the gentleman is recognized for three mins. mr. miller: thank you, madam chair. exempting this funding source from s.e.c. regulation is not all this bill does. it also prohibiting -- prohibits the state from doing anything. this is not a case where the proponents of the bill are saying, let's not let the federal government do this, let's let the states do this they say, no, the states can't touch it at all. the people of the various states, using their right to vote, can't decide that in their
state, they want someone looking at what is being offered to mom and pop investors to make sure they're not getting flimflammed. that's a great deal of the protection, the investor protections we've had in this country, has been done at the state level, this takes them off the beat altogether. if you think that the states should be able to exercise their own judgment, the people of the state should be able to exercise their own judgment about whether they want their states looking at what is being offered to mom and pop investors, you should vote against this bill. i yield back the balance of my time. the speaker pro tempore: the gentleman yields back. the gentleman from north carolina. mr. mc-- mr. mchenry: i need to correct what think colleague said. what he said is not in fact what this bill does. furthermore, as we know, securities fraud is prosecuted not just at the federal level
but by the states as well. that will continue to exist. furthermore if my colleague from north carolina would reach out to my colleague from colorado, i'm supporting his amendment which preserves the states' rights of action. i'll be happy to yield. >> that has to do with enforcement but it prevents the secretary of state can look at it, require disclosure, welcome at what the disclosures are, look at whether -- what is being offered is really what is there. thanks to the gentleman's good work -- mr. mchenry: to correct the state of record, in the state of north carolina, there's no prefiling requirement. in the state of new york, they have upfront filing requirements. additionally in this
legislation, how it is crafted, is the s.e.c. would provide notice of this offering to the states once that offering occurs. this is something that my colleague from new york, mrs. maloney, crafted in the subcommittee. we worked -- my staff as well as financial service committee republican staff worked diligently with the democrat staff on the financial service committee as well as mrs. maloney's staff and came up with a three-page amendment which was adopted on a bipartisan basis. i preeblet my colleague from new york offering that. it has improved the bill. i'd be happy to yield. mr. miller: did the gentleman not get a letter saying what you just said ain't right. mr. mchenry: i did not receive that letter. my two democrat colleagues from north carolina did in fact get that letter. my colleague, mel watt, fantastic member, submitted it
for the record in the financial services committee. i've had neither a law nor a call from my secretary of state raising considers about that. with that, i'd be happy to yield such time as he may consume to my colleague from new jersey, the chair of the subcommittee on capital markets and financial services, mr. garrett. the speaker pro tempore: the gentleman is recognized. mr. garrett: i thank the gentleman from north carolina for all his work on this legislation as well as the chairman of the full committee, spencer bachus for his leadership on this initiative as well, to the extent that with the previous piece of legislation we had goes to the overarching theme today and during this past months in this time in the house, which is job creation for this country. what can we do here in the house of representatives to facilitate the creation of more jobs and like with the last piece of legislation, we can help businesses small and large to obtain additional capital, capital being at the horte they have -- of the ar -- of the
ability of a small business to expand and grow and hire new employees in this country. the legislation before us goes well in that direction and now it is done in a bipartisan manner. it stands head and shoulders above where it was before because it adds additional provisions for safety and soundness to it. investors can exchange ownership stock in that company. in a future direction, grow larger, allows companies to obtain those funds without having to repay specific ams at specific time sms it enables the company today, to obtain that capital today, to expand the company and hire new employees. through the efforts of the gentleman from north carolina, what they did in a bipartisan manner was add additional, what do you want to call it protections, i guess, which was part of the discussion that i
think we had in committee at the time. that was a good discussion there. we had a hearing on it in the committee, we had the markup in the committee, rather to allow more some of these discussions and i know it went further after the hearing and eventually with markup to aheave this. i think it's important, i'm just going to spend a minute, i know you touched on some of these, i want to take a minute or two to touch on the adegreesal protections we're providing, they're in order of page eight and nine of the bill in front of me here, first, warning investors of the speculative nature generally applicable to investment in startups, that's what we're talking about here, if you're going to invest in a startup, it's speculative, not a sure thing. second, warnings on subject to the restriction of sale requirements. if you're informsing in this don't expect you can take your money out tomorrow but that there may be restricks as to when you can take out your mup.
that's necessary so that the business can have that capital to grow. it's reasonable. thirdly, taking reasonable measures to reduce the risk of fraud with respect to such transactions, again, reasonable measure. fourthly prorkviding the s.e.c., the securities and exchange commission, with continuous investor level access to the issuers' website. why? we want to make sure the information being conveyed is the information the s.e.c. has. fifthly, requiring each potential investor to demonstrate their abilities, and i think the gentleman from north carolina went through this, but a, recognition of the level of risk generally applicable. if you're going to get involved in this, make sure you understand it. that's one of the questions. b, risk of liquidity. if you're talking about a startup company, as opposed to something that's traded on one of the exchanges, there's not a lot of liquidity out there generally speaking. that means there's a lot -- not a lot of folks trading these
shares on a daily or hourly basis. you have to understand that there's going to be restriction on liquidity in this marketplace and see such other areas as the s.e.c. may determine are appropriate. sixth out of seven i want to tch upon, maybe this is what the celt was reference, the outsourcing of cash management functions to a qualify third party custodian. i think he referenced tra digal brokers dealers, which i think is the appropriate manner, otherwise what you may be doing with these restribs being good, you don't want to get too restrictive in this. if you did do that, then you may end up making this as difficult as if you were in some other fame without objection. >> i thank my colleague for yielding. this is an important point of distinction here. these intermediaries are not
broker-dealers. that is neither the intent on either side of the aisle, that is not the description of it. these intermediaries are -- they are there to have a low-cost conduit for capital formation. and a means to do that. that's the intention. and all the protections outlined in the bill on these intermediaries, on how they are to operate, are there to enable it to be both low cost but also preserve individuals' capital and make sure their investments are taken care of. >> is one of the reasons because it may be an artist starting up a business or a nonprofit starting a business, businesses urn $1 million. mr. garrett: if you were talking about what we read about in the "wall street journal," things that may be shortly traded on the new york stock exchange, that would be more appropriate
but you're talking about these much more smaller type of industries, right? mr. mchenry: absolutely. the intent is if you're going to raise $50,000 from 5,000 people, it has to be a low cost basis of doing that and the traditional broker-dealer model is not efficient at the lower cost basis fundraising opportunities or equity raising opportunities. mr. garrett: part of the other problem is you may not fine the interest by the broker keelers if you're talking about a $25,000 or $50,000 or $100,000 enterprise, is that another reason you went this way? mr. mchenry: with traditional broker-dealers, they're not in this market. our intent with these low-dollar issuances, that has not been a traditional part of the action on wall street. not in the modern era. so we're trying to carve out
this opportunity for small businesses. i yield. mr. garrett: tied to this is another one of the two last points i raise, perhaps you would illuminate, it requires that the intermediaries take a target amount you're raising, perhaps $50,000, and one of the requirements urn it is you would have to withhold the capital formation proceeds, the money you collect, until you hit a percentage of or that target amount. mr. mchenry: correct. mr. garrett: that's investor protection, you don't want to have happen is, i'm going to start raising money and i can start cruising it right away even though i was intended to raise $200,000, those proceeds may not go to the point where intended. i' the gentleman from colorado is nodding his head. is that the reason why this was included in here?
>> yes. mr. perlmutter: if my friend from new jersey is yielding to me for a second. mr. gare rhett: i understand i've gone over the time i was supposed to be speaking. mr. perlmutter: i'll reserve my comments to -- for my time. the speaker pro tempore: the -- the chair: the gentleman from colorado. mr. perlmutter: how much time does each side have. the chair: the gentleman from colorado has 23 minutes remaining and the gentleman in colorado has -- and the gentleman in north carolina has 9 1/2 mips remaining. mr. perlmutter: the gentleman from new jersey brought something up, my friend from north carolina is correct, i misstated it, the intermediary is more or less the platform, the conduit, but one of its responsibilities, an this is fun in 4a, section 10, is to outsource the cash management response lts to qualified third
party custodians such as broker dealers or insured depository institutions which was a concern that we were all -- we all had during the committee hearing is, ok, who is holding the money? can they be trusted? will they release the money at the right time? which is what the gentleman from new jersey was just talking about. i thank my friend from north carolina for reminding me of that section and i just again, it's another piece of investor protection in a good idea that helps with capital formation. again we're trying to plend those concepts. i yield three minutes to mr. green of texas. the speaker: the gentleman is recognized for three mins. mr. green: thank you, mr. perlmutter and i thank mr. mchenry and i rise in support of h r. 2930, the entrepreneur access to capital act.
and i'm standing where i'm standing because i'm honored to celebrate the bipartisanship associated with this act. for those who are at home who may not be able to see and understand that normally i would be standing to my right. but i do unconventional things and i think it's appropriate today to stand where i'm standing. mr. mchenry, i'm like to thank you for the spird -- i'd like to thank you for the spirit that you have shown as we have tried to make this a better bill. i'd also like to echo these same expressions of appreciation to mr. bachus. i think that mrs. maloney merits an expressble appreciation as well. -- ex specialble appreciation as well -- expressionble appreciation as well. i do want to thank the staff who worked with us because they did outstanding work. mr. grim and i were able to -- mr. grimm and i were able to craft a bipartisan amendment that would aid and assist in the
effort that mr. perlmutter has called to our attention, making sure that the persons who handle the dollars, that these persons are not persons who have been convicted of either state securities fraud or federal securities fraud. and this amendment would require that the s.e.c. construct appropriate measures, regulation or rule to prevent these persons from handling the money, if you will. and i'm honored to say that with this amendment i find this bill much better than it was initially but i also have to say that mr. mchenry never rejected the bill, the amendment, and i'm grateful that it has worked out to the extent that it has. so today we will have greater transparency, we will have a small business -- small -- we will have small businesses in a position to use crowd funding, to fund their efforts. and also we give persons who
cannot invest in a large way an opportunity to invest in a small way and hopefully enter into the capital markets for equity purposes. with this said, i thank you again and i yield back the balance of my time. the chair: the gentleman from texas yields back the balance of his time. the gentleman from north carolina. the gentleman from colorado. mr. perlmutter: i yield three minutes to mrs. maloney. the chair: the gentlelady from new york for three minutes. mrs. maloney: i thank the gentleman for yielding and his outstanding work on this bill and so many others. i first of all want to thank ranking member waters and ranking member frank for their hard work on this bill and to commend ranking member frank for his outstanding leadership on the dodd-frank regulatory reform bill. i also applaud the leadership of chairman bachus and chairman garrett and my colleague, mr.
mchenry, from the great state of new york -- great state of north carolina for his work on this really new idea in capital formation and for working so well and being so open to democratic ideas and worked in a very professional way with the democratic staff and member staff and mens -- members and literally in some form or another accepted every democratic amendment which i think is a first. so we are grateful for that. crowd funding is a way for small startups to raise capital through the internet. investors use these websites to come together and on the internet they are able to raise lower dollar amounts to help enterprises get off the ground. crowd funding is a new way of raising capital, it's a new idea
and it helps small businesses. and in this time of economic hardship we have repeatedly heard from our constituents about the need to help small businesses. we have heard from small businesses about the need to have more liquidity and more loans. and we really need to make sure that america's innovators and entrepreneurs and researchers have the resources necessary to drive economic recovery and to turn their ideas into the reality of a company that will create jobs and grow our economy. by passing this bill we will make it easier to provide different avenues for startups and smaller businesses to access the capital they need, to move our economy forward. and it will not only help small businesses raise capital, but thanks to the changes in
amendments we agreed upon in committee, it contains much stronger investor protections as well. during the committee markup i offered a amendment that was accepted which will require the issuers to provide notice to the s.e.c. that they intend to engage in crowd funding. the s.e.c. must then make that notice available to the state securities regulators and with that knowledge the states can ensure and better protect investors and it's strengthening really investor protection and really enforcement. the manager's amendment, i ask for an additional minute or two minutes. mr. perlmutter: i would yield a minute to the lady. the chair: the gentlewoman is recognized for an additional one minute. mrs. maloney: the amendment agreed to in the committee will empower the s.e.c. with additional safeguards to make crowd funding safer for investors. it was literally in a joint democratic and republican amendment. and i am very glad we were able
to work together to make this a better bill and i'm really happy about this bill because new york is a center for innovators and many people come from all around the world to build their ideas and this bill will help them do it. it was done in a joint effort and i hope that my friends on the other side of the aisle will join us in passing the american jobs act which will also put americans to work and help grow our economy. we are not going to cut our way to prosperity. we need to invest in growth. the american jobs act invests in our infrastructure, in our workers, in innovation. it helps build the american dream and so i hope my colleagues will join with us in passing that important bill, too. i urge my colleagues to support this bill. the chair: the gentlelady's time has expired. the gentleman from north carolina. mr. mchenry: i yield myself 20
seconds. the chair: the gentleman is recognized. mr. mchenry: i thank my colleague from new york for improving -- improving this legislation and for her staff working so diligently with my staff and the staff on the committees as well. very wonderful and constructive process. i think this is a better bill and i hope the senate can take it up and pass it and send it to the president. and with that i yield back. and i -- actually i reserve the balance of my time. the chair: the gentleman reserves his time. mr. mchenry: and i would say to my colleagues, i'm prepared to close. the chair: the gentleman from colorado. mr. perlmutter: did you say you're prepared to close? mo more speakers? mr. mchenry: no more speakers. mr. perlmutter: ok. do we have anybody else? the chair: the gentleman from colorado is recognized. mr. perlmutter: thank you, madam chair. if i could have one --
i would like to thank my friend from north carolina for bringing this bill forward. it's a good idea, it allows for investments to be made in smaller amounts by more people. using mass kinds of solicitations. through the internet, through some other vehicle that we may not know of at this point. and that is a good step. and as we've gone through the process, we build it into a better bill by adding investor protections because this is something where people could be misled, there could be misrepresentations and there has
to be some penalty for that. and we builded -- billed it in the will, as the amendment process goes forward, we build those amendments into this. having said that, having listened to the bill preceding us, making it easier to sell investments, sell deals to accredited investors, that's a nice step, too. again, we need to have investor protection restrictions in there just to make sure people don't get defrauded. we just suffered through that in 2008 with the likes of madoff and a number of other -- stanford and a number of other fraudsters, con artists. we want to minimize that if we can as we try to make capital available to businesses to grow. now, let's not make any mistake here. these are nice steps but they're not going to put a lot of people
back to work. and my friend, mr. mchenry, described the president speaking in this very chamber about this bill but what he was really talking about was the american jobs act. and the american jobs act is what this body needs to pass as well. we need to put -- keep teachers on the job, we need to keep firefighters on the job, we need to put construction workers back on the job. today -- and there were complaints about the united states senate slowing things down, blocking things. well, today the united states senate, the republicans in the united states senate blocked rebuilding the infrastructure of this country, the roads, the bridges, the energy system, the sewer systems, the basic things that this country needs which would put thousands and thousands of construction workers back on the job.
so it would be jobs today, investments for a long time for this country. we need to keep those teachers on the job, we need to put our veterans as they come home, as they come home from iraq and from afghanistan, we need to make sure they have a job. that's part of the jobs act. that's what needs to be done today. this is a good step in capital formation. but it isn't putting people to work right away. that's what this nation needs. this jobs act that the president proposed when he talked about crowd funding as we have been in this bill. what he was here for was to get the jobs act, to get these tax credits passed that would help our veterans get to work, to get our infrastructure rebuilt, to rebuild our schools and to keep teachers on the job. that's what this nation needs, that's what this nation wants, that's what our people expect.
and so i thank my friend from north carolina for bringing this bill forward. it's a good idea. he's been willing to work with us to make it a better idea and we thank him. we also ask him and his colleagues on the republican side of the aisle to pass this jobs act today. america needs it today and with that i yield back. the chair: the gentleman from colorado yields back the balance of his time. the gentleman from north carolina. mr. mchenry: i thank the chairman. and i yield myself such time as i may consume. the chair: the gentleman is recognized. mr. mchenry: the entrepreneur access to capital act is about giving entrepreneurs the power to raise money, to raise equity stakes in their business, or their business idea. to grow their business or create a new business. that's really what this is about. and the legislation we have here on the floor today, i heard some people talk about the internet is just a series of tubes or they refer to the internet as the internets or something like that. but we understand, and my
colleagues understand that the internet can be used in a positive way. in an absolutely positive way. that with a website like e by a, you have individuals -- ebay, you have individuals exchanges goods that don't know each other but they can tell their reputation. and they can exchange these goods and get quality goods for a quality price and you have a lot of choices. we want to take that idea and give investors that same idea. we have crowd funding websites in the united states today. they help raise money for musicians or artists and what the artist does is say, you know, if you invest in my act to go into the studio and record an album or whatever they call it, i'll give you the first download or i'll give you the first c.d. and so you have folks poneying out $50 or $25 for their favorite band. you have folks that are raising money, folks that have a bakery
and they say, if you contribute a few bucks you'll get six whoopy pies. so people have innovative ways of doing this. well, we're giving them the power, the opportunity and relieving this federal restriction that currently prevents them from having equity stake in their favorite business, their favorite idea, their local coffee shop or their bakery, their favorite band or even the next facebook. these are the opportunities that we're going to be able to give investors. we have fraud protection in this legislation, crafted in a bipartisan way tavepls strong improvement to the bill and i look forward to a bipartisan vote. i'm very hopeful it'll make its way through the senate intact and make its way to the president's desk where he can sign it that way we can allow entrepreneurs and innovators that opportunity. we take the best of microfinance
and the best of crowd sourcing and combine them in this legislation. it's a positive thing. and we can work together on important matters of creating jobs. we have, and this is a first step and i certainly appreciate my colleagues' willingness to work, to improve the bill, and to bring us to this day. with that, i yield back the balance of my time. the speaker pro tempore: the gentleman yields back the balance of his time. all time for general debate has expired. pursuant to the rule, the amendment in the nature of a substitute shall be considered as an original bill under the five minute rule an shall be considered read. no amendment to the committee amendment is in order except those pripped in house report part a of 112-265, each such amendment may be offered only in the order printed in the amendment shall be considered read, shall be debatable for the time specified in the report, equally divided and controlled
by the proponent and opponent, shall not be subject to nand for division of the question. it is now in order to consider amendment number one printed in part a of house report 112-265. for what purpose does the gentleman from north carolina rise? mr. mchenry: i reck these myself for such time as i macon um. the chair: the gentleman has an amendment? mr. mchenry: i have an amendment that the edesk. the chair: the clerk will designate the amendment. the chair: amendment number one -- the clerk: amendment number one pinted in house report 112-263 offered by mr. mchenry of north carolina. mr. mchenry: this is primarily a technical amendment based on postmarkup from the staff. the final lang wamming has been designated from my staff and the majority and minority staff on the financial service
committees. the more substantive changes made include requiring the issuer to state a target offering amount and a deadline to reach the target offering amendment, require the commission to provide notice on completion of the offering which shall include the aggregate offering amount in the number of purchasers, clarifying the disqualification provision to ensure that both issuers and intermediaries as well as their predecessors affiliates, officers, directors or persons affiliated or fulfilling similar rolls are disqualified from the exemption established in this bill should they have a history of committing securities fraud. i appreciate the s.e.c. staff lending their technical ex-peer tees to them and the borne effort from both the majority an minority committee staff to further improve the final bill. with that, i retain the balance of my time. the speaker pro tempore: the gentleman reserves his time.
does any member seek time in opposition? the gentleman from north carolina. mr. mchenry: i yield back. the chair: the gentleman yields back. the question is on the amendment. those in favor say aye. those opposed, no. in the opinion of the chair, the ayes have it this ayes have it, the amendment is agreed. it is now in order to consider amendment number two printed in part asks of house report part a of 112-265. for what purpose does the gentleman rise? >> i have an amendment at the desk. the chair: the clerk will report the amendment. the clerk: amendment number two offered by mr. fincher of tennessee. the chair: pursuant to house resolution 453, the gentleman from tennessee, mr. fincher, an a member opposed will each control five minutes this chair recognizes the gentleman from tennessee. mr. fincher: i want to thank mymy colleague, mr. mchenry for
trying to put the focus on creating -- creating jobs. it's often not what we do but what we can undo up here that will let the private sector back in the business of creating jobs. the amendment i'm offering with my colleague from california, mr. cher map, would adjust the one million -- the $1 million and $2 million caps on the underlying bill from inflation this will ensure investment tuns today are just as strong as tomorrow. as the real value of money decreases over time, small contribution investors may be encouraged from supporting startup companies due to original buying power. by indexes the caps in the bill, we will continue to allow investment opportunities for main street americans like our teachers, police officers, and farmers to pool their money and support entrepreneurs in their communities. i urge my colleagues to support
this amendment and i reserve the balance of my time. the chair: the gentleman reserves. does any member seek recognition in opposition. the gentleman from tennessee. >> i yield to my colleague if north carolina. >> i thank the gentleman for offering this amendment. this is a good government amendment. the old adage is $1 million isn't what it used to be. one million dollars when regular -- $1 million when reg d of the securities and exchange commission of 1934 had $1 million exemption put in place in 1982. that $1 million would be $2.4 million today. so it can show you just in a short period of time 30rk years, the impact of inflation. i appreciate my colleague for offering this amendment. it's a very good amendment. i certainly appreciate you representing the good folks of
tennessee. mr. fincher: thank you. i yield back the balance of my time. the chair: the gentleman yields back. the question is on the amendment offered by the gentleman from tennessee. those in favor say aye. those opposed, no. in the opinion of the chair, the ayes have it. the ayes have it. the amendment is agreed to. it is now in order to consider amendment number three printed in part a of house report 112-265. for what purpose does the gentleman from arizona seek recognition? >> i have an amendment at the desk. the chair: the clerk will designate the amendment. the clerk: amendment number three printed in part a of house report 112-265 offered by mr. quayle of arizona. the chair: pursuant to house resolution 453, the gentleman from arizona, mr. quayle and a member opposed will each control five minutes. the chair recognizes the gentleman from arizona. mr. quayle: i thank my friend and colleague from north carolina for bringing this bill to the floor and thank my
friends on the other side of the aisle for working on this important bill as well. this is a common sense amendment that will make it easier for american companies to raise capital and to expand and hire more workers. i support the gentleman from north carolina's legislation which removes an unnecessary barrier to allow startups and maul businesses to raise capital through individual investments up to $1,000 or 10% of the individual's income. any amendment would index this cap to inflation. entrepreneurs pay a -- play a vital role in our country. over the last three decades, new businesses have created 40 million jobs and been responsible for nearly all net new job creation. unfrlt, the environment for new businesses has grown incressingly unfavorable. in the last two years the number of new businesses launched has decreased 23% an far fewer small companies are holding initial public offerings.
too often, when legislation is not indexed to inflage, congress must go back and amend current las. for instance, $10,000 would be $27,535 today. the need for small businesses to have access to capital is constant. it makes sense that as the value of the dollar fluctuates overtime -- over time we should adjust the cap accordingly. this will support economic growth at no cost to the taxpayer. i support h r. 2930 and i urge my colleagues to support this pro growth amendment. i reserve the balance of my time. the chair: the gentleman from colorado. mr. perlmutter: i claim time in opposition but i'm not in opposition. the chair: the gentleman from colorado. mr. perlmutter: i want my friend from new york to catch her breath, that's why i claim time in opposition. but i have a question. in 2008 when the stock market crashed, when we saw home prices drop like a rock, when people
lost their job, we experienced over a several-month period, deflation. not inflation, deflation. under this bill -- the under the amendments, boston the preceding one as well as the amendment by my friend from arizona, when i look at it, i think it also if the price goes down, this could also shrink. am i -- i yield to my friend from north carolina? mr. mchenry: i thank my colleague for bringing this up. it is a great concern. i didn't have the opportunity to say, i do support the gentleman's amount and appreciate him offering it. it's a very thoughtful amendment. i believe looking at this, when you have it on an annualized basis, that does actually allay some of those concerns. but i think you and i agree that while we don't address some of these securities laws as frequently as we should to update with techling in and what happens in the market, that we
should have in place these measures to ensure that congress' intent is followed even 20 years from now and can keep pace with what is reasonable in the marketplace. i think your concern is actually a very interesting one and i'd be happy to talk with the gentleman more about ways to update securities laws to deal with some of these struggles. mr. perlmutter: i thank my friend from north carolina, we have no opposition to thement a, urge its adoption and i yield back. the chair: the gentleman yields back. the gentleman from arizona. mr. quayle sfk i yield to the gentleman from north carolina. mr. mchenry: thank you, madam chair. i want to thank my colleague, mr. quayle, for offering this amendment, it's a thoughtful amendment, thoughtful approach to securities law, very thoughtful approach to crowd funding and the idea of allowing investors the same opportunities, the average,
everyday investor the same opportunities that high net worth individuals enyou in this country. i thank the credit for working on job creation an job growth and with that i yield back. the chair: the gentleman from arizona. mr. quayle: i yield back. the chair: the question is on the amendment offered by the gentleman from arizona. those in favor say aye. pose pose. in the opinion of the chair, the ayes have it this ayes have it. the amendment is adopted. it is now in order to consider amendment number four pripped in part a of house report 112-265. for what purpose does the gentlelady rise? >> i have an amendment at the desk. the clerk: amendment number four printed in house report 112-265 offered by ms. velazquez of new york. the chair: pursuant to house resolution 453, the gentlewoman from new york, ms. velazquez, an a member opposed, each will kohl five mins.
the gentlelady is recognized. many velazquez: i yield myself such time as i may consume. the chair: the gentlelady is recognized. ms. velazquez: in order for entrepreneurs to continue to fulfill their role as job creators, it is important that they continue to have access to the funds they need. crowd funding represents a promising new tool for this purpose. but in order to realize its full potential, investors who buy securities must be able to make fully informed decisions. my amendment would make this possible by requiring crowd funding intermediaries to disclose how they are compensated. despite its relatively recent emergence, crowd funding share miss characteristics with ordinary stock investing. in this marketplace, however, websites and social media will fill the role of brokers and tealers. they will act as a con
constitute between stock insurers and ordinary investors. and like stock brokest, these intermediaries may be paid by commission, flat fees or subscription. depending on how -- on their compensation structure, however, intermediaries may have an incentive to advertise their ideas that provide them with the most money, rather than what makes the most investment sense. this not only puts ordinary investors at risk but also undermines the entire premise of crowd funding, which is supposed to promote those ideas that have the most merit. compensation discle sure is not without precedent. it is currently required by all securities brokers and dealers. this transparency provides investors with a vital information necessary to have the confidence that their investment decisions are proven.
furthermore these disclosures take nothing more than a few lines on a sheet or from a quick conversation. this is a simple, common sense amendment that will help ordinary people make informed investment decisions as this new industry evolves. if intermediaries will fulfill the role of brokers and dealers in crowd funding openings, it only makes sense that just like others in the investment industry, they should be subject to similar requirements to protect the investors they will solicit. i urge members to vote yes on the amendment and i reserve the balance of my time. the chair: the squealt from new york reserves the balance of her time. the gentleman tissue for what purpose does the gentleman from north carolina rise? mr. mcren -- mchenry: i claim time in opposition. the chair: the gentleman is recognized. mr. mchenry: unfortunately, i have to oppose this amendment. in the course of a subcommittee legislative hearing a
subcommittee markup, and a full committee markup, this amendment was never offered. my colleague if new york serves on the financial services committee, as my other colleagues have mentioned, i worked diligently aross the aisle to incorporate every idea my colleagues from across the aisle had. it's a better piece of legislation because of it. my colleague had the opportunity at full committee markup to offer this amendment and didn't. we heard at the subcommittee hearing on the capital market subcommittee, i attended that and all members of the financial services committee that were there that day were allowed to participate, none of the witnesses raised a compensation disclosure as a precondition to create successful crowd funding securities offerings. my colleague did not participate in the hearing and when the subject matter of the amendment could have been raised with the panel of capital formation experts, it was not raised.
this is an interesting amendment. what we have in this legislation is an enormous amount of investor protection. we want crowd funding intermediaries to be able to compete with one another. and to innovate and to offer the best platform and technology for both issuers and investors. our belief is that businesses will be able to have -- work with different intermediaries, if they don't see an intermediary that fits with their cost structure or the cost basis they see fit, they can be their own intermediary. that's how the bill's constructed. this amendment doesn't work technically with the construct of that, but by forcing intermediaries to disclose the compensation structure of potential -- to potential investors, we believe it will have a chilling effect on competition and the market and the participation of potential intermediaries in this mode. and so unfortunately i've got to
oppose this amendment. had the gentlelady brought this amendment to me during the subcommittee or full committee markup i would have been happy to work with my colleague on trying to craft workable language but here on the floor today i oppose the amendment and i ask my colleagues to vote against this flawed amendment and i reserve the balance of my time. the chair: the gentleman reserves the balance of his time. the gentlelady from new york. ms. velazquez: may i inquire how much time do i have left? the chair: the gentlelady from new york has 2 1/2 minutes remaining. ms. velazquez: i would yield 30 seconds to the gentleman. mr. perlmutter: and i thank the gentlelady. i just say to my friend from north carolina, appreciate the fact that you -- you know, this is new, but i think when we are dealing with the small investments and lots of people, just as with it a -- just as with a charity, you like to know that most of it's going to the charity and not to the sales -- not to the solicitation effort. and that is what i would say this is important so you know that it's getting to your investment and not to the sale effort. so i would support her
amendment. the chair: the gentleman's time has expired. the gentleman from north carolina. mr. mchenry: i yield myself such time as i may consume. the chair: the gentleman is recognized. mr. mchenry: do they disclose on their campaign websites how much it cost to process the credit card contribution? exactly. i don't know if my colleague's making those disclosures when folks are contributing to their campaigns. so this restriction is something actually a creation of congress. i understand the issue. it's a very powerful issue on compensation. this was never raised. any -- in the two subcommittee hearings i've had on the capital formation, on the tarp and financial subcommittee of oversight government reform nor in the legislative markup, nor during the subcommittee markup, nor the full committee markup in this committee. in the committee of financial services. furthermore, i would point my
colleague to page 6 of the legislative text. we have investor protection requirements for intermediaries that go on for really three pages. this specifies a lot of investor protection. this received a bipartisan vote that the time for this amendment is passed. it is not best constructed here on the floor. i ask my colleagues to vote no and with that i yield back. the chair: the gentleman from north carolina yields back the balance of his time. the gentlelady from new york. ms. velazquez: it amazes me that given the experience that wrought us to this -- brought to us this time where -- that brought the economy to its knees, with the wall street crisis, with madoff ponzi scheme, that you come here and you say that this is not the appropriate time. it is the appropriate time to protect investors. and that is exactly what we do here.
compensation disclosure, for us to tell -- for the investors to have the information to know who their investors -- how are they going to be compensated? that is the appropriate time. this is the right time. and it is important that we protect investors by they knowing how those intermediaries will be compensated. how their money will be invested. what makes more sense for an intermediary to invest in this company versus this other company because if he invests in this other company he's going to make more money? what is wrong with transparency? what is wrong with disclosure? it's -- nothing is wrong. mr. mchenry: will my colleague yield? ms. velazquez: no, you have your time. mr. mchenry: i yielded back the balance of my time. i would is a my colleague -- ms. velazquez: out of order,
madam speaker. the chair: the gentlelady has the time. ms. velazquez: yes. no, you have three pages of protections, right? but you left the most important protection for investors. yet we need -- what is wrong with investor to know how those intermediaries will be compensated? that is the core of my amendment and we should, just like brokers and dealers, they will have their own business interests and they will not necessarily be the same as investors' interests. this interest and that of the investors are not mutually exclusive. just like brokers and dealers, intermediaries will have discretion to choose which investment they promote. so i ask a yes vote on my amendment. the chair: the gentlelady reserves the balance of her time and the question is on the amendment offered by the gentlelady from new york. those in favor say aye. those opposed, no.
the noes have it. the amendment is not adopted. the gentlelady from new york. request the yeas and nays? ms. velazquez: yeas and nays. the chair: pursuant to clause 6 of rule 18, further proceedings on the amendment offered by the gentlelady from new york will be postponed. it is now in order to consider amendment number 5 printed in part a of house report 112-265. for what purpose does the gentleman from georgia seek recognition? mr. barrow: i have an amendment at the desk. the chair: the clerk will designate the amendment. the clerk: amendment number 5 printed in part a of house report 112-265 offered by mr. barrow of georgia. the chair: pursuant to house resolution 453, the gentleman from georgia and a member opposed will each control five minutes. the chair recognizes the gentleman from georgia. mr. barrow: i thank the chair and yield myself such time as i may consume. the chair: the gentleman is recognized. mr. barrow: many of the small business owners i've talked to back home tell me the biggest barrier they face in starting up a business is securing access to capital. when traditional lenders aren't lending we need to find ways to get startup and expansion money
into the hands of small business job creators. this bill uses the internet to knock down some of the financial barriers that get between mom and pop startups and willing investors. so they can get the money they need to grow their businesses and put more people to work. however, as with almost everything involving the internet, new opportunities to do good bring new opportunities for mischief. we all agree that business and investors must understand the potential risks that come with these innovations. the bill requires that the s.e.c. adopt regulations specifying the warnings and information the issuer has to offer but it leaves the content and the formatting of this information to rule making proceedings to be completed later. and it leaves open the possibility of inconsistent warnings and information for different investment opportunities. my amendment takes the bill's basic approach, one -- approach one step further by requiring that the offering contain a link to a site maintained by the s.e.c. where the s.e.c. will post a comprehensive set of
warnings and safety tips to anyone who's about to use the internet to raise capital without all of the hassle and the safeguards of a regulated s.e.c. public offering. this would provide a consistent set of warnings and avoid the inconsistent, unclear or misleading messages that investors might get from different websites. a word to the wise is sufficient. but too many words can obscure the information that folks really need. my amendment offers something better than a word, a link to the information that we all agree that investors should have available to them before they put the money down. investors don't have to read it and they don't have to heed it but it's there and that's the least that we should do. small businesses and the investment community stand to gain from this system but only if everyone involved is on the same page about the potential benefits and drawbacks. my amendment will help make sure that happens. i want to thank my colleagues for their work on this bipartisan bill and i ask for your support in passing this job-creating investor-protecting amendment and i reserve the balance of my time.
the chair: the gentleman reserves the balance of his time. the gentleman from north carolina. mr. mchenry: i rise in opposition. the chair: the gentleman is recognized. mr. mchenry: thank you, madam chair. unfortunately i've got to oppose this legislation. i would ask my colleague from georgia if he consulted in the construct of this language with the s.e.c. staff? mr. barrow: our staffs have consulted with each other about the utility of this. i don't know how far they have gone with the s.e.c. but i can tell you the basic outline of this requirement is not to gum up the offering, not to require the issuer put all kinds of stuff in the offering that can obscure the information that the offer wants to put to the public. and can allow the s.e.c. basically to intrude into that offering but to provide one simple link where they can go and get all the information that any wise investor needs. mr. mchenry: we did not see this legislative text until it was filed with the rules committee. we worked to try to accommodate the member with text that could
be acceptable. unfortunately the construct of this is simply not acceptable and we couldn't come to a reasonable accommodation on language that would be workable. look, the s.e.c. is certainly overburdened. we all know that. they're working very hard. they currently have two websites right now. what this amendment would do is force them to have a third website. furthermore, in the discussion of this amendment, my colleague describes this as a public offering. the crowd funding legislation described here is an exempt offering, very different in nature than a public offering. and it is exempt from the s.e.c. regs. we have on page 6 of the legislation, subsection a-1, it mandates that individuals, intermediaries in this process would have to add a warning to
investors including the intermediary's website of the speculative nature generally applicable to investors and startups, emerging businesses and small issuers, including risks in the secondary market related to electric widity. two, warns invests that are they are subject to restrictions on sale requirements described under subsection e. this was a -- as well as i've got additional, number six requires each potential investor and recognition of the level of risk generally applicable to investments in startups, emerging businesses and smaller issuers. b, risk of illiquidity and, c, such other areas as the commission may determine appropriate. this is -- part of the legislation, my staff, as well as the staff of the financial services committee, a democrat and republican as well as the staff of mrs. maloney and ms. waters, crafted this language in a very balanced way. we've included those concerns.
unfortunately the language before us today is deeply flawed and with the nature of securities laws as they are in this country and in the world for that matter, we want to make sure it has the appropriate balance,s that been thoroughly vetted through counsel and actually has agreement and that is why this amendment is deeply flawed and i oppose it and with that i retain the balance of my time. the chair: the gentleman reserves the balance of his time. the gentleman from georgia. mr. barrow: thank you, madam chair. i yield myself such time as i may consume. i understand the gentleman to be concerned about the distinction between this type of offering and a public offering and i wish to remind him perhaps what wasn't clearly understood. the point we're trying to make here is an exempt offering that does not have all of the hassle and the fine print and all of the safeguards that go along with it a public offering. it is because we're trying to provide the ease and convenience of a public offering while still providing the necessary information that folks have to have that we're all concerned about the investment warnings that the gentleman thinks we that the gentleman thinks we need to have in the bill.
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