Mr. Chairman, since 1984 the number of personal bankruptcies has exploded: from about 300,000 per year to an anticipated 1.3 million in 1997. And half of that increase has taken place in just the three years since we established this Commission. Of course, there are a number of reasons for this dramatic jump -- credit card companies that are all-too-eager to lend to potential deadbeats, a culture that discourages personal responsibility and promotes “finger-pointing,” and, perhaps, a bankruptcy code that is inadequate and outdated. While I don’t think any of us wants to go back to the era of “debtors prison,” we need to do something to reverse this trend. The Commission’s report comes at a crucial time.

In that context, let me make a few brief points. First, we appreciate and applaud the Commission’s efforts. The Commission solicited a wide a variety of views about the bankruptcy process, hearing from 3,000 individuals in written and oral comments. It reached a consensus on most of its recommendations, which will make clear improvements in the bankruptcy code. And its work came in under budget. Indeed, if we can measure the Commission’s success in part by the reception it received, its hard work has paid off in a balanced product -- because both creditors and debtors have objected to some of its recommendations.

Much of the reason for the success of this Commission is owed to Brady Williamson of Wisconsin, who did a terrific job after taking over as Chairman under difficult circumstances.

Second, let me single out one of the Commission’s recommendations, which is based on a proposal I have pursued for years, to establish a maximum homestead exemption of $100,000. The homestead exemption protects a debtor’s most basic need -- a roof over his head -- from being sacrificed to satisfy his debts. However, although few would question that debtors deserve a home, in practice this exemption has been repeatedly abused. While the vast majority of states responsibly cap the exemption at $40,000 or less, millionaire debtors often move to one of the five states that allow unlimited exemptions. In places like Florida and Texas, they declare bankruptcy and then continue to live like kings, while their creditors get little or nothing. So I am pleased that the Commission shares my concerns, and Senator Sessions and I plan to offer my measure as an amendment to the Grassley-Durbin consumer bankruptcy bill.

Mr. Chairman, Congress of course has the ultimate responsibility for bankruptcy reform. Undoubtedly, we will accept some of the Commission’s recommendations, reject others, and propose a few new ideas. Still, these recommendations are an excellent starting point. Thank you, Mr. Chairman, and a thanks to each of the Commissioners.