Mr. Chairman, I rise in opposition to the amendment offered by the gentleman from Missouri (Mr. Graves) regarding vicarious liability for rental car companies. This amendment, if passed, would nullify the laws of 15 States and the District of Columbia and would have the disastrous effect of allowing rental car companies to lease vehicles to uninsured drivers with no recourse for innocent victims should an accident occur. Fifteen States and the District of Columbia allow rental car companies the freedom to lease cars to whomever they choose whether or not the customer has his or her own insurance. In exchange for this right, the companies are required by the State laws to assume responsibility when uninsured drivers cause injury and are financially unable to compensate the people they injure or kill. If the gentleman from Missouri's amendment were to pass, the innocent victim would have no recourse, no insurance company to sue.

This trade-off is in the best interest of both the States and the rental car companies. For example, my own State of New York is one of the most active rental car markets in the country. In New York City, many, many people do not own cars. Therefore, they do not have automobile insurance. If companies were allowed to rent cars only to insured drivers, and that is the natural result should this amendment pass, these States would allow companies to rent only to insured drivers, many New York residents would effectively have no access to rental cars and the rental car market would decline.

This situation is not unique to New York. Anybody, Republican or Democrat, who is from Arizona, Connecticut, Delaware, Iowa, Maine, Nevada, New York, Rhode Island, the District of Columbia, California, Florida, Idaho, Michigan, Minnesota, Oklahoma, and Wisconsin should not vote for this amendment, Republican or Democrat, unless you want to say to your State legislators: We are going to preempt the law of New York, of California, of Florida, wherever, because we know better. Many of these States are big tourism States. By holding rental car companies responsible for the out-of-state drivers who rent cars while vacationing, these States protect their own residents from negligent out-of-state drivers. Vicarious liability laws also protect innocent Americans from negligent foreign drivers. If a foreigner rents a car in New York City or Los Angeles, runs over a pedestrian and her child, and then flees the country, the injured family would be left with no remedy should this amendment pass. In fact, the Graves amendment would probably shift responsibility away from wrongdoers and onto taxpayers. That is not something we ought to do.

There is nothing wrong, Mr. Chairman, with a State deciding, a State making its own decision. We believe in that here, supposedly. There is nothing wrong with a State deciding that it is in the best interests of the people of that State for uninsured drivers to be able to rent cars, but to require the car rental companies to take vicarious liability so that we do not shift the burden of paying for an accident to the pedestrian, the innocent victim or to the hospital or to the taxpayers, it is a perfectly reasonable thing to do. And 15 States and the District of Columbia have done it. Why should Congress usurp the States' power to make this decision for themselves? What is the overriding Federal interest in preempting State laws on this subject?

Rental car companies reap lots of profits in these States. Any expense that results to them from these State laws, such as any insurance policy the rental car company itself has to carry to cover its liability, is simply passed on to the rental car drivers as a cost of doing business. If we are going to preempt State vicarious liability laws, we could require that any uninsured drivers must purchase insurance themselves from the rental car company, but no such requirement is included in this amendment.

To pass this amendment is to say that we are going to obviate the policy choices of these States and shift the burden of any accidents to innocent victims of accidents in those States. We should not do it. The States should decide this question as they have. I urge my colleagues to oppose this amendment.