STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Ms. STABENOW (for herself, Mr. Enzi, Mr. Johnson, Mr. Hagel, Mr. Schumer, Mr. Bayh, Mr. Carper, and Mr. Corzine):
S. 1532. A bill to establish the Financial Literacy Commission, and for other purposes; to the Committee on Banking, Housing, and Urban Affairs.
Ms. STABENOW. Mr. President, I rise today to introduce the Financial Literacy Community Outreach Act of 2003. This bill, which I am proud to introduce with my colleague and friend, Mr. ENZI, is the product of several months of work. We have reached out to financial literacy advocates, financial institutions, Federal agencies, and other interested parties to craft a comprehensive bill to streamline, augment, and improve our government's approach to financial literacy.
The need for this legislation is clear. Studies show alarming shortcomings in the state of financial literacy in America. For example, in a survey of consumers 18 years and older conducted by the American Association of Retired Persons in late 1998, only 11 percent of respondents correctly answered 4 basic financial questions. A study by the Jump$tart Coalition for Personal Financial Literacy found that, in 2002, on average, high school seniors could correctly answer only about 50 percent of a set of financial answers put to them a failing grade.
In addition, from 1990 to 2000, the outstanding credit card debt among households more than tripled from $200 billion to $600 billion. And, a 2002 study by John Hancock found that, in a study it did, 50 percent of respondents said they spend half an hour or less per month managing their retirement funds.
These are all very disturbing statistics and, just a few examples of why I feel the need to act to improve our government's approach to this problem. We need a clear and effective strategy to address these problems.
The Federal Government understands that financial literacy is essential to a healthy economy and the protection of consumers. That is why many Federal departments and agencies have employed their resources and expertise to educate the public about how to accomplish such goals as realizing the dreams of homeownership, saving for a child's college education, and planning for a secure retirement. These agencies do this through grant programs, through special training, and by developing financial literacy materials.
Unfortunately, what Mr. ENZI and I, as well as others active on this issue, have come to realize is that these programs are uncoordinated and, in some places, duplicative. There is no mechanism for these agencies to interact and assess the good work they are doing. That is why, in our legislation, we set up a Federal Financial Literacy Commission.
Made up of Federal decision makers with jurisdiction over one or more financial literacy programs, including the Federal Reserve, the FDIC, the Treasury Department, the Department of Housing and Urban Development, the Securities and Exchange Commission, and the Small Business Administration, our Commission, and its constituent members, will take all necessary steps to coordinate, streamline and improve existing programs. The Commission will also make recommendations to Congress on legislation that may be needed to improve financial education.
I am pleased to say that this new Commission will operate as a nexus for all Federal financial literacy materials, grants, and information; spearhead efforts to reach out to the public with financial literacy messages; manage a toll free hotline; operate a website promoting financial literacy and highlighting Federal grants, materials, and programs; and, it may feature private and non-profit resources available to the public.
Improving the state of financial literacy is a common sense thing to do. It is something that we can do through cooperation and strategic thinking about our Federal resources. And, it can be done with the input of all concerned interests. Many people in the Senate have worked diligently on the subject of financial literacy, including Mr. SARBANES, the Ranking Member of the Banking, Housing, and Urban Affairs Committee who has done important work on this subject.
I am pleased that Mr. ENZI is the lead Republican sponsor of this legislation; he is a true leader and cares passionately about this issue. And, I appreciate the leadership of the bipartisan group of Senators who have agreed to cosponsor our bill: Mr. Hagel, Mr. Johnson, Mr. Schumer, Mr. Bayh, Mr. Carper, and Mr. Corzine. I look forward to working with them and all of my other colleagues in the Senate to ensure that we have an effective, coordinated, and comprehensive Federal approach to improving financial literacy in our country.
I ask unanimous consent that the text of this legislation be printed in the RECORD.