|FOR IMMEDIATE RELEASE:||CONTACT: CHRISTI HARLAN|
|Wednesday, February 14, 2001||202-224-0894|
Sen. Phil Gramm, chairman of the Senate Committee on Banking, Housing and Urban Affairs, made the following statement today at a full committee hearing on S.143, the Competitive Market Supervision Act of 2001. The bill, introduced Jan. 22, would reduce the fees collected on securities registration and transactions while assuring adequate funding for the operation of the Securities and Exchange Commission. The bill would also allow the SEC to bring the pay of its employees in line with the pay of other federal financial regulators.
"The bill we have before us that does two things. First, it seeks to change the law to assure that we have a system whereby there will always be enough money to fund the SEC, but the fees on new stock issues and transactions won't continue to be a general revenue source for the federal government.
"Thanks to the growth in the economy, these fees are now generating six times as much as we need to fund the SEC. And these fees, over time, become a fairly substantial tax burden as people try to accumulate wealth. I have been trying to come up with figures that would help us understand the problem. By taking some estimates that might be applicable to a college professor or an auto mechanic, saving for retirement, we find that they will pay $1304.55 in excessive fees over their lifetimes. And if that money were invested for retirement over a 45-year working lifetime, with a conservative 6 percent return, that grows to $5,800, or $11,600 for a two-wage family. That shows that the fees are a very heavy tax on people who try to build up savings, to send their children to college, to retire or to provide for their future.
"The second thing we want to do is establish pay parity for the SEC, giving the SEC the ability to pay wages that are competitive with what we now allow in financial regulatory agencies. I think this is very important. There are few people who love government less than I do. But I believe that if you are going to do things in government, and government has a role in a free society, then you need to have the best people you can get performing those functions, and having more competitive pay is very important."