Mr. KYL. I am not requesting an extra 10 minutes. Following my 10 minutes of remarks now, the other time is allocated to complete the total of the Republican time, the time allocated to our side.
Mr. KYL. This makes the point that there is a direct connection between the weak dollar and the high oil prices Americans are having to pay at the pump. It makes the point that if the dollar were stronger, it would take fewer dollars to buy the same amount of gasoline. That is something additional we can do. That is primarily not a congressional matter but a matter for the Federal Reserve and the Department of the Treasury, primarily the Federal Reserve.
All of these are ways we can deal with the problem of the high cost at the pump. We need to address all of these issues. But until we have addressed them, we should not move off of the legislation and take up something that is less important. The only exception to that is the housing bill we will vote on next. We have complete agreement to do that. Then when that is concluded, we will move back to the energy debate we have been having, the debate on how we can reduce the cost of gasoline at the
pump. The American people expect us to do that, and we should complete that work before we leave for our August recess.
S. 3268 ``Stop Oil Speculation Now''
A WEAK DOLLAR CONTRIBUTES TO HIGH OIL PRICES
At $124 a barrel, oil prices are still close to record highs, and the weakness of the American dollar has a lot to do with it.
Often the increase in oil prices can be attributed to political turmoil in the Middle East or a significant supply issue (as occurred after Hurricane Katrina). While these are factors today, there is another reason you could see an increase in the price at the pump.
Since January 2007, while oil prices have more than doubled, the American dollar's [Page: S7489]
value has decreased by approximately 13 percent. As the economy has slowed, the Federal Reserve has dropped the Federal Funds rate numerous times over the past year--a total reduction of 3.25 percentage points since January 2007. Dropping the interest rate is meant to stimulate the U.S. economy, but it also weakens the dollar.
The American dollar is the currency used by the Organization of the Petroleum Exporting Countries (OPEC), the conglomerate of oil producing nations that sets global oil prices. Thus, any fluctuations in the value of our dollar are reflected in the price of oil.
As our dollar falls in value relative to the euro, yen, or price of gold, the price of oil goes up. Since oil is priced using the American dollar, what Americans pay for oil will increase to compensate for this change.
At the same time, however, other nations are shielded from the same oil price increase because their own currencies are more valuable than the dollar. European and Asian countries (among others) are importing their oil for significantly less than what Americans are paying. Europeans pay just 79 euros for a barrel of oil while Americans pay more than $124. Returning the U.S. to a ``strong dollar policy'' would greatly reduce the price U.S. consumers pay for oil.
Confidence in the value of the U.S. dollar is also vital to American financial competitiveness. A weak dollar makes investment in foreign markets more attractive, particularly for those who seek to diversify their portfolios as our economy slows. Further dollar weakness could precipitate a dramatic shift of money from domestic to foreign markets.
The key idea to understand here is that the value of our American dollar is an important consideration to the investor and consumer confidence. Without this confidence, our economy will have a difficult time avoiding recession.
So these are several reasons why it is in our nation's best interest to support a stronger U.S. dollar. Economist David Malpass wrote in a recent Wall Street Journal op-ed, ``A strong, stable currency is itself one of a country's most valuable fundamentals, not a byproduct of other fundamentals. Our fundamentals haven't been nearly as bad as the dollar's seven year slide. More likely, the weak dollar trend is itself a bad economic fundamental, masking health elsewhere.''
THE FEDERAL RESERVE SHOULD FOCUS ON FIGHTING INFLATION
There are two things that can be done to better the dollar. First, the Federal Reserve should switch its focus from maintaining economic stability to fighting inflation. In periods of slower economic growth the Federal Reserve traditionally responds by reducing short-term interest rates, but that can exacerbate inflation, which has increased substantially--growing at 4.9 percent in June from the same time a year ago.
Note that while the dollar has fallen, the euro remains relatively strong because the European Central Bank (ECB) has not only refrained from lowering interest rates due to their concerns about global inflation but actually raised their target interest rate to 4.25 percent on July 3rd.
The Federal Reserve needs to follow the ECB's lead and resist the political pressure to cut interest rates in order to stabilize the value of the dollar.
The second thing would be for Congress to begin to make our current, relatively low, tax rates permanent.
Our currency is the foundation for our economy; without a strong dollar our economy will not be able to achieve the stability that is necessary to control oil prices or the economy.
Mr. DURBIN. Mr. President, at this moment in the U.S. Capitol, there are scores, if not hundreds, of employees at work. It is unusual for most of them to be here on a Saturday, but sometimes it is necessary. It is unusual for the Senate to be in session on a Saturday, but sometimes it is necessary. One can certainly argue that when the United States is facing a serious issue, we should be at work, whether it requires our being here on Saturday, Sunday, or all the days of the week. That is what
we were elected to do.
Certainly, the housing bill, which is before us now, is a matter of grave concern to many of us who see across America foreclosures that are taking away the homes of many American families and affecting the value of millions of other homes. But this could have been done yesterday. In fact, it could have been done weeks ago.
Six different times, the Republicans initiated filibusters to stop this housing bill--six different times. They have set all the records in the Senate for filibusters, and they applied six of them to the housing bill.
To add insult to injury, they added a day of session, a totally unnecessary day of session for which we are meeting this morning. This could have been sent to the President yesterday. He could have signed it, bringing some assurance and confidence to consumers across America that maybe this housing crisis can be put behind us and this economy can move forward. But one Senator, the Senator from South Carolina, insisted that the Members of the Senate all stay here today.
It is the second time in 2 weeks he has taken away a day of our lives with our families. This time the Senator from South Carolina is going to be here for the vote he has asked for, and I think that is good. It certainly is his right to do that.
You say to yourself: There must be some matter of great moment that would have him keep the entire Senate here for an extra day, cause us to ask scores, if not hundreds, of people to come and work that extra day. Well, what is that issue? The issue is whether we are going to put some language in to limit or prohibit two Federal agencies--Fannie Mae and Freddie Mac--from having lobbyists on Capitol Hill. It is a good issue. I might even vote with him on this issue. But to think he would hold the
Senate for another day, make us open this session and bring all those people to work for this amendment on a bill which we know must pass, which the President has urged us to pass, is hard to understand.
It is his right to do it. It is any Senator's right to do it. But there comes a point when you step back and say: We can fight this battle another day. This is not a life-or-death issue. This is not an issue that has to be decided on this Saturday or else.
But we are here. We are here to face this issue, deal with the housing bill, which I hope will pass. President Bush initially opposed this bill. The President said there were provisions in here he could not accept. But then there was a serious concern across America as to whether these critical agencies--Fannie Mae and Freddie Mac, which are involved in standing behind almost half the mortgages in America--were being threatened.
I got a personal call from Secretary Henry Paulson, our Secretary of the Treasury, at home last week. He said: We have to do something. This is an emergency. I said to Secretary Paulson: I think you are right. I may not agree exactly with your approach, but there comes a time when we have to rise together, on a bipartisan basis, and deal with a serious crisis. This could be a crisis if we do not act.
I said to him: Would you urge the Republican Members of the Senate to have the same sense of urgency in passing this housing bill that I hear in your voice? He said he would try. Well, he was not very successful. Six different times the Republicans have tried to stop this housing bill with a filibuster and now have dragged us into a Saturday session here to slow it down again.
But today, with any luck, it will pass, and finally we will send it to the President's desk. The President said he is prepared to sign it. This is too serious an issue for him to stand in the way. I am glad the President has made that decision. I do not think it is going to turn around the American economy, but we know the housing crisis certainly started us on the skids that are leading us toward a recession. There are much bigger issues in our economy that need to be resolved even beyond housing.
The simple fact is, the overwhelming majority of Americans are worried and angry--worried about their own financial situation. They have seen the values of their homes plummet. They have seen their retirement savings diminished by a stock market that is unpredictable. They know the cost of gasoline is taking more money out of their wallets and credit cards every single week. A trip to the food store is a little more expensive than it used to be. It costs more money to put those kids through school.
And if you get stuck with medical bills now, it could break the bank and empty your savings account.
That is the reality of life in America today. The Bush economic policy has failed. This notion that we can somehow give tax breaks to the wealthiest people in America and prosper as a nation never did make sense and has resulted in the mess we have today. This notion that we can wage a war and spend $12 billion to $15 billion a month for almost 6 years now and not suffer some problems in America as a result never made sense. It does not make sense today. Each month the administration adds that
money to the deficit, [Page: S7490]
piling up more debt on America's kids, debt that is currently financed by foreign governments that step in and buy America's mortgages. What a legacy: an economy that is so weak that people are worried and even angry; a prospect of more of the same, unless
there is a real change in Washington; and when it comes to the Senate, a slowdown. Let's slow it down with six filibusters when it comes to a housing bill. Let's make the Senate meet on a Saturday. Let's keep them in. Let's try to slow this down even more. That is the Republican approach. It is not a good approach.
I think there are Republican Senators of good will who understand we can do better. Let me point out one: Senator Richard Shelby of Alabama. He stepped up. As the ranking Republican on the Banking Committee, he and Senator Chris Dodd, our Democratic chairman, worked together to get this bill done. I salute him and all who helped him bring this bill to the floor. That is the kind of bipartisan spirit we need: that sense of urgency, that sense of bringing the bill to the floor
to do something for our Nation. I wish his voice had prevailed in the Republican conference and all those filibusters had not taken place and this unnecessary Saturday session had not taken place. But the decision was made by the leadership to allow this to go forward, and that is their decision.
Mr. President, I will say a word about what Senator Kyl addressed on the energy package. It is hard for me to understand how my friend from Arizona--and he is my friend--could stand here and suggest we have stopped the Republicans from offering their solution to deal with America's energy crisis. We did not. Senator Kyl knows we said to them: Put together your package and bring it to the floor. We will do the same. Let's have two competing ideas. Let's debate them. Let's give
them the same vote. And then let's decide.
That is what we are supposed to do, isn't it? We are elected, on a bipartisan basis, to try to solve problems. With 51 Democrats and 49 Republicans, things have to be done on a bipartisan basis for most important issues. But Senator Kyl and Senator McConnell, on the Republican side, rejected that. They said: No, we want to start an amendment process. Let's see how this unfolds. Let's bring out seven amendments to start with and you can bring out whatever you want and let's talk
it over and let's go through the debate. Unfortunately, that would have led to nothing because we have a deadline facing us. Coming in just a few days, we are going to break for our August recess. We could have been mired down in the debate with an endless number of amendments and nothing would have happened.
The American people want something to happen. They want us to deal with this energy crisis, and they understand simply saying we are going to drill for more oil, on its face, does not make sense. The United States, in all of its oil reserves we can identify and think of, has about 3 percent of the world's supply of oil. But we are big oil consumers in this country. We consume 25 percent of the oil produced in the world each year. Mr. President, 3 percent available, 25 percent consumption.
As T. Boone Pickens, now the patriarch, I guess, of energy policy, said: We can't drill our way out of this problem. T. Boone Pickens is an oilman. He knows we need more. We need responsible exploration and production. We need to use the land we have already leased. We need to tell the oil and gas companies that are reporting record profits: Get to work, find those sources of oil that you already think are there in this leased Federal land, and go after them. Do it in a responsible way. Do not
pollute our beaches and do not pollute our Nation. Do it in a sensible and responsible way. I think all of us would endorse that. I hope that is what the Republicans stand for too.
But it is not enough. We need conservation and fuel efficiency. We need cars and trucks that get much better miles per gallon. We need to be thinking about the buildings that are being constructed and the lives we lead and how, in small and large ways, we can change our energy consumption without compromising our economy. We need to be thinking about renewable, sustainable sources.
It breaks my heart that three different times we brought to the floor this energy tax extender, which would create tax incentives for more renewable, sustainable energy--wind power, solar power, the kinds of things that do not pollute, do not create global warming but do create electricity and energy for families and businesses in America's economy--and we lost it. We could not bring enough Republican votes forward to vote for it three different times.
A major company in my State came to visit me, a man from this company this week, who said: I am facing bankruptcy if you don't accept the responsibility of extending these tax credits. I believed you when the Congress said: We need a new American energy policy. I invested my hard-earned money in it. I am employing people around the country. We are building these wind turbines. Why don't you do your part and extend this tax credit?
But, unfortunately, we have not been able to rally the Republican votes that are necessary to do it. We will have another try at it this week. I hope they will reconsider their position and think--forward think--about the energy policy of this country. That is the reality. If we can start bringing down gas prices and stabilize them, if we can start looking ahead to new sources of energy, if we can start creating new companies, new technology, new jobs, new opportunities, then we clearly will
have a better future in the 21st century.
I wish to help--and I am sure everyone in the Senate does--these families deal with the reality of energy costs. We can do it.
Mr. President, we are going to have a LIHEAP bill later today. This is a bill for the poorest in our country, the elderly, the disabled, people who cannot afford to pay their utility bills in the summer and the winter, and we give them a helping hand. Let's extend that too.
For goodness sakes, these folks are barely getting by at the moment. We ought to give them that helping hand. Today, we will have a chance to vote on it.
Mr. President, I yield the floor.
Mr. DeMINT. But the majority leader has to agree. And further parliamentary inquiry: Is it not true that the majority leader scheduled two votes today by filing cloture earlier this week when these would ripen today?
Mr. DeMINT. I would like to proceed with my time, if I could. I thank you. Certainly, the majority whip will have his say again when we are through.
The Democratic majority leader announced to all of us about a month ago that we would be here this weekend because there were some bills he wanted to get through. And so those Americans looking in who are not that interested in all our procedures and carrying on here--the majority leader scheduled that there would be two final votes today, Saturday. He told us, as Republicans, we could have no amendments on these bills, and then he demanded that we give
unanimous agreement that we move those votes he had scheduled back to Friday or even Thursday. Now, they are complaining about a Republican who has no authority when we schedule votes, complaining that somehow I scheduled these votes today. I guess a lot of Members are naive and believe that. But I do not think Americans buy it.
I know a number of folks are disappointed we are here on Saturday and not somewhere else. But I am not worried about how disappointed Members [Page: S7491]
of Congress are. I know Americans are very disappointed, not that we are here on Saturday but that we are not working every day of the week, 24 hours a day, to address the major issues in this country.
They are disappointed, and we know they are. In fact, Americans think less of this Democratic Congress than Americans ever have of any Congress in history. And it is not just the Democrats. I am very disappointed myself. I came here--I came to the House 10 years ago--with great hopes that I could be a part of addressing major issues facing our country and create a generation of opportunity by helping Americans and helping freedom work for everyone.
I have been disappointed that it has been increasingly obvious that the Democrats are so controlled by a few interest groups--the union bosses, the plaintiffs' lawyers, environmental extremists--that they are afraid to allow their Members to take votes that would tell Americans where they stand because they do not want to offend these interest groups.
Now, I am equally critical of Republicans because I have been disappointed in them as well because many of them have lost sight of what we believe, what we came here for, and have lost the courage to fight for it. So many times the scenario of bills that are coming through here is: In order to check the box, Republicans agree to add Democratic policy that continues to expand Government.
The Senator from Illinois has complained about these filibusters. Again, it is these mysterious procedures that we have in the Senate that he remarkably calls filibusters: when they put a bill on the floor and then they file a motion to cut off debate; and when we do not agree to cut off debate, they call that a filibuster.
Americans should know, in this Congress, 855 bills have passed in secret--no vote, no amendment, no floor debate. Ninety-four percent of everything we have passed in the Senate has gone by what they call unanimous consent. Now, some of these are legitimate unanimous consent bills--naming a post office and other things.
Americans should also know this housing bill has major implications not only for spending but for government taking control of private sector businesses, taking ownership of private property, putting the taxpayer on the line for billions and possibly more. They wanted this bill passed in secret, by unanimous consent, without anyone knowing what is in it. I want to talk about what is in it.
Last week, we had a $50 billion foreign aid bill that they wanted passed by unanimous consent, in secret. When some of us step up and say: No, this is too important; we need to bring it to the floor and maybe have an open debate and allow a few amendments, that is what the Senator from Illinois calls a filibuster. This is no way to do business, but it is the way this Congress has gotten America in so much trouble today.
As I speak about a few issues, I wish to keep one issue in front of everyone, because as bills come through here, there is always justification: It is a farm bill; we have to vote with the farmers. It is a veterans bill; we have to vote for veterans. It is a housing bill; we have to vote for homeowners and homebuilders and realtors. We should consider what our own Congressional Budget Office and the administration is projecting. Beginning right now, in 2008, the expansion of debt in America is
going to do more to hurt our economy and hurt everyday Americans than anything we are doing here. Yet we never even talk about things we could cut, wasteful programs we could fix. What we talk about is basically appealing to interest groups by passing one thing after another that is designed to attract constituencies and votes and campaign contributions from different groups.
Yes, I am disappointed, and I know Americans are too.
As we talk about the energy debate--and again, I will criticize Republicans and Democrats, but when it comes to this one, there is no issue clearer in terms of who has restricted the supply of American energy over the last 20 years. This has clearly been a partisan issue: the Democrats responding to extreme environmentalists, going back to President Carter's years when he cut off the development of nuclear energy, the recycling of nuclear waste. President Clinton vetoed, a little over 10 years
ago, the development of oil reserves in Alaska. Democrats voted almost unanimously to stop us from developing our oil and natural gas reserves in this country. Like the old Steve Erkle of ``Family Matters,'' now they are standing here and saying: Did I do that?
They are trying to blame big oil and speculators and George Bush and everyone but themselves, but on this issue there is probably nothing clearer of how this Congress has caused America a huge problem, and now they are saying we are going to save America.
The Democrats will not allow an open debate and open amendments, as is the tradition of this Senate. They will not allow their Members to take votes on drilling and deep sea exploration in America or a separate vote on developing the oil shale in this country or expediting the development of our nuclear capabilities. They won't allow these amendments to come to the floor for the reasons I have already mentioned. They don't want Americans to know where they stand, and they want to appease the
extreme environmentalists. They are trying to have it both ways. That is why we are stuck in doing nothing here, because instead of doing what the Senate has done for literally centuries, we are here trying to protect Democrat Members so they don't have to take the tough votes.
I wish to use one quote from my distinguished colleague from Illinois, because he is suggesting that he wants an open debate when, in fact, we are not allowed to pick our own amendments. Please be clear. The Democrats are not allowing Republicans to offer our own amendments. They want to select one amendment for us and say that is our bill, and now that we want a full debate, they are saying we won't take their generous offer.
The Senator from Illinois said in March:
My good friend, the late Congressman from Oklahoma, Mike Synar, used to say: If you don't want to fight fires, don't be a firefighter. If you don't want to stop crime, don't be a policeman, and if you don't want to vote on tough issues, don't run for Congress.
I agree with him.
States Senator Durbin.
I don't like facing tough votes, but it is a part of the job. You ought to at least have enough confidence in your beliefs to cast that vote and go home and explain it.
The Senator has even indicated that the one vote I would like on my amendment to this housing bill he might support. Yet he won't allow me a vote--not this week, not next week, not in September. I offered to allow the majority to schedule this vote any time, not attach it to the Housing bill, not slow it up 1 minute. The housing bill could have gone to the President on Thursday, but they are so afraid of voting on an amendment that would cut off campaign contributions to Democratic colleagues
and cut off the lobbying of the organization we are talking about bailing out that they will not allow a straight-up vote so America can see where they stand.
This Congress is the Steve Erkle Congress. If you go back during the Congress and see what we have done even before--well, think of the big amnesty bill that was pushed through here. Only a few of us looked at the bill. We discovered that how it was promoted was not true. It would not control our borders. It would not create a workable immigration system. Basically all it did is reward people who came here illegally. But by letting the American people know what was in the bill--putting it on
the Internet, talking to bloggers, radio talk shows and holding the bill through a debate period--Americans rose up and said: No. We figured you out, Congress, and we are not going to do it. Millions of Americans stopped this Congress from passing that amnesty bill.
Millions of Americans are standing up as we make them more aware of the thousands of earmarks to special interests and friends back home that this Congress spends most of the year doing instead of addressing priorities. Americans are standing up. They are on to Congress, and we are going to keep pushing the Democratic majority to do something about this wasteful spending.
In a few years, the same people who had voted time after time to spend the [Page: S7492]
Social Security surplus on other things--and believe me, it has been 100 percent on the Democratic side. I have offered an amendment to stop the raid on Social Security and the Democrats have stood up every time and voted it down, so there is not one dime of money saved for Social Security because of Democratic spending. In a few years, those Democrats are going to be standing
blaming someone else. This time it might not be big oil or the speculators, but they will be calling for an investigation, because in less than 10 years, the money coming in for Social Security is not going to be enough to pay the benefits. My Democratic colleagues will be calling for an investigation: Who stole the money from the trust fund? They will be hoping the American people forget how they voted.
We see the same thing on health care every day. They complain about the uninsured Americans, but when I put a bill on the floor that would allow individual Americans to at least do what businesses do and deduct the cost of their health insurance as we allow businesses to do, every Democrat voted against that, because they don't want Americans to own health insurance. They want the Government to take over health care. So at every point we try to expand health insurance, they try to kill it.
I could go on and on about this dysfunctional, disappointing Congress, but I guess I should move to housing and talk a little bit about the bill that is on the floor today.
Could I inquire how much time I have remaining?
Mr. DeMINT. Well, I better move quickly here. Again, this is a bill they want to pass in secret with very little debate. I have asked for one amendment--one amendment to stop the lobbying.
This is not a good chart, but hopefully I can make the point. This is the taxpayer at the top. This is Congress. This is Fannie Mae and Freddie Mac. Years ago, Congress created Fannie Mae and Freddie Mac as private sector organizations that were supposed to help the mortgage industry and help people buy homes. Certainly it did, but Congress was supposed to watch them because we gave them monopoly status. They received huge tax breaks so no one in the private sector could compete with them, so
they grew and grew. The idea was that this Congress would pass the reforms and provide the oversight so that Fannie Mae and Freddie Mac would not get out of control, because effectively when we formed them, we told the markets and the American people the taxpayer was going to guarantee they would not lose money.
What happened is they stopped these reforms of Fannie Mae and Freddie Mac and over the last 10 years they spent nearly $200 million in political contributions to Senators and Congressmen, spreading money all around Washington. A lot of think tanks that are supposed to be watchdogs are not watchdogs to Fannie Mae and Freddie Mac because they have spread so much money around.
Now as we ask the American people to come in and put their money into the pot to hold up Fannie Mae and Freddie Mac, the one gesture of good faith as a Congress we could ask is: Hey, that is a conflict of interest. We can't have the people who are supposed to watch over these organizations getting money from these organizations. At least if we are going to ask the American taxpayer to be on the hook for billions, possibly trillions of dollars, let's stop this. So I said that is all I want, one
amendment, 15 minutes of debate, and then you can have your housing bill, even though it is a terrible bill. They said no. They said no. We are going to keep Members here Saturday to keep you from having your amendment.
There are a lot of problems with this bill, but it doesn't matter. Here it is. It is almost 700 pages. Not one Senator has read it. There are lots of little goodies stuck in there. There is one we found, an earmark on page 616 that overturns an IRS ruling where low-income housing--which is supposed to be for the general public and not discriminate--that they can discriminate for social organizations such as art colonies. Then we find an organization, Artspace, that develops low-income housing
and gives it to these artistic colonies, one of their board members happens to be the executive director of the Fannie Mae foundation.
Folks, this bill needs to be aired out for weeks, if not months. They want to rush it through. We kept them here on Saturday so the American people could find out a little bit more about what is in it. But no matter what is wrong with it, most of the Members of this Senate are going to come in and vote for it and check the box and go home and say they did something about housing. I am afraid they may compromise the future of America as they do it.
I am sure I am about to run out of time. I know this is a lost cause and I am not going to stop this bill, but I am disappointed, the American people are disappointed, and what we have done by keeping the Democrats and the Republicans here today is maybe give Americans a little more time to see what this Congress is doing to their future.
With that, Mr. President, I reserve the remainder of my time and yield the floor.
Mr. DURBIN. Mr. President, after hearing the Senator from South Carolina, it is time we initiate an investigation. I think we ought to call the Sergeant at Arms Office. Something terrible has happened here. Apparently, the pages on the Republican side of the aisle are not distributing the Congressional Record to the Republican Members. The Senator from South Carolina says we are about to vote on a secret bill that no one has seen. Clearly, the pages have failed to put the Congressional
Record of July 23 at the desk of the Senator from South Carolina, because if they did, the Senator would find the bill in its entirety printed in the Congressional Record.
I am sure the Senator knows this is no new bill. This bill has been around since April. The Senator has had ample opportunity to read his so-called secret bill.
This is terrible that they aren't distributing the Congressional Record on the Republican side of the aisle. We have to look into this, as the Senator says he has evidence of 855 secret bills--again, a failure to deliver the Congressional Record to the Senator from South Carolina. Every single one of those bills, I say to my colleague, is printed in the Congressional Record for him to take home and to read--to read on the plane back and forth to South Carolina. It is
I am sure the Senator from South Carolina has been overlooked because we have something called hotline. Under the hotline, every Senate office is called before every bill is brought to the floor, and any Senator can stop the bill, put a hold on it. Every Senate office is called. For some reason, on the Republican side, the cloakroom is obviously not calling the Senator from South Carolina.
They are trying to get something past him, secret bills. It is a shame. It should be looked into. The Senator is not getting the Congressional Records, the hotline calls, and is being overlooked by his Republican conference. That isn't fair. We need to look into this. For the rest of the Senate--99 other Senators--this is on our desk every day, the Congressional Record, printing out every bill in its entirety for us to read, if we want to, or ask our staff to. A hotline call
is made over and over every day to let you know a bill might come to the floor. It is not a secret process. The Congressional Record is not classified. It is open to the public. It is published so everybody can read it. It is available on the Internet.
So I say to the Senator from South Carolina, let's lift the veil of secrecy and let's start delivering the Congressional Record to his desk every day so he can keep up with the Senate and know what is going to be debated and voted on. The Senator has kind of avoided the obvious. The reason we are here today--and we could have been with our families--is because the Senator from South Carolina insisted on it. We tried to get our work done in a way so Members could get back to their families.
We could have done it yesterday. The Senator from South Carolina objected. He has a right to do [Page: S7493]
that. That is why we are here today. Let's not beat around the bush about that.
In terms of quoting former Congressman Mike Synar, I stand by that. We didn't tell the Republicans what they had to offer on the Energy bill. We said put in your package what you want to put in your package. Bring your drilling amendment, your oil shale amendment, your amendment for nuclear power, and all of that was refused. That was refused. We weren't writing a single word of any Republican amendment. That was your right as a Member of the Republican conference to do that. I certainly hope
that, incidentally, the Senator from South Carolina, who talked about his amendment on lobbying, would share a copy with us. Right now, it is a secret amendment. The Senator has not shared it with us. We asked for copies of it. I hope maybe he will share that with us.
Mr. DeMINT. Mr. President, I advise the Senator from Illinois that I have been to the floor asking unanimous consent to offer this amendment, which has been available all week. It is in the cloakroom. The amendment is simple and available. I remind the Senator that when bills appear in the Congressional Record, it is after they have passed. As far as the hotlines that come through late at night, I get many calls at the airport from my staff, when we are leaving at the end of
the week. That is when these bills go through, and they want to pass them by unanimous consent. Often a copy is only available in the cloakroom. Members have not read them. We are all used to doing business that way, and it is a problem when we start talking about major policies
and billions of dollars of money that is spent--certainly on a bill such as this. We may make it available for a few days, so it is not to say it wasn't available, but I know not one Member of the Senate has read it all and seen the special provisions that have been stuck in it.
I ask unanimous consent--to clear up what the Senator from Illinois has said--that next week, when we come back, we have a free and open debate and that the Republicans and all Members be allowed to offer their amendments, without restriction from the Democratic side.
Mr. DOMENICI. Mr. President, I have some remarks I think are very pertinent to what is going on in the Senate regarding energy for the American people. I wish to have answered a couple of the statements the Democratic whip stated regarding these amendments. I don't have time now, but I will soon.
Suffice it to say we don't have a chance to offer amendments. Anybody who says the Republicans are free and open and have an opportunity to offer amendments is not reading the Record. The majority leader has fixed it so we can't. I rise to speak about a great amendment for the American people that will be pushed aside because the majority leader has short-circuited the so-called Energy bill. This amendment gets at the heart of what we have been saying we need to do: Find more, use less.
Republicans believe we have a supply-and-demand imbalance, and the amendment I speak about this morning attacks the core of the problem. Republicans want to act on the No. 1 issue facing the American people. We want to act now. We have a great quantity of American resources on the Atlantic and Pacific offshore coasts, and so the first part of the Coleman-Domenici amendment--which we would have sent to the desk, and it could have been pending and we could vote on it, but it is out of order because
the majority leader has seen to it that it is out of order. This Coleman-Domenici amendment would have allowed coastal States in those areas to open the waters within their offshore boundaries for leasing 50 miles out. Fifty miles out could not do damage to the sea, the shores, or to the coastal areas the people want to use for their daily lives. You could not even see the activity 50 miles out.
The States would receive 37.5 percent of the revenues from this production, which could mean literally billions of dollars. When we passed the Gulf of Mexico Security Act of 2006, we opened deep sea areas containing more than 1.25 billion barrels of oil and nearly 6 trillion cubic feet of natural gas. This will provide domestic energy for millions of Americans, and it is roughly estimated to provide up to $400 million for the Gulf Coast States over the next 10 years, and tens of billions of dollars
over the coming decade. When the Atlantic and Pacific States see this money rolling into these coastal States, they will be clamoring for more energy, more revenues, and for the good-paying jobs this great energy enterprise will bring.
Our amendment is clearly a positive on several fronts. The American resources on the Atlantic and Pacific coasts contain 14 billion barrels, at a minimum. I say ``a minimum'' because we have not been prudent enough, I say to fellow Senators, to spend money to inventory it in an appropriate way--the coastal planes areas--to see how much is there. We know there is a lot. But the estimates are old estimates and, in every case, these old estimates have been very many times wrong. We have had much
more in resources than the old estimate would indicate. Now, the 14 billion barrels is more than we have imported from the Persian Gulf over the last 15 years. If people wonder if there is any oil, it is 15 years of importation from the Persian Gulf will be found in these offshore waters. That is a minimum. That is the old estimate, which was done decades ago under old technology.
That is why I have also filed an amendment that provides $500 million in funding to pay for a real inventory of our national resources offshore. The American people could hardly believe that we are in 2008 with modern technology and we don't know how much oil and natural gas is ours, belongs to our people, which we could use. We don't even know; we haven't bothered to find out.
A few months ago, the people of Brazil set out to explore and develop their own coastal resources. Like us, they knew they had oil offshore. Like us, they didn't know exactly how much. Well, in April, one company started drilling from exploratory wells in a deep water area off of the coast of Rio de Janeiro. To their surprise, they found as much as 33 billion barrels of potentially recoverable oil. Just like that, overnight, Brazil took control of its energy dependence by finding 33 billion barrels
of oil. In the words of one of the great energy experts, Daniel Yergin, who I am proud to say is a friend:
Five or six years ago, nobody really thought there was a huge supply off of [Page: S7494]
Brazil. Now people are saying this could be as big as the North Sea.
To put that quotation into perspective, the North Sea has provided as much as 6 million barrels per day at its peak. Perhaps our amendment could do the same for our people. But we may never know because the majority leader refuses to address the most important issue in America in a serious way. For some reason I can't understand, there remain a number of Democrats--
Mr. DOMENICI. Mr. President, the second part of the amendment addresses the issue of using less. We have all heard about electric cars, and we know if we can get these batteries up to where they will do 100 miles before they need to be recharged, we will have electric batteries sprouting up all over America. That will save crude oil. Without a doubt, we will have established an excellent approach to America's energy future.
All we need is for our majority leader--he belongs to the Senate--to be fair and let the Republicans have a vote on behalf of America. Why do they fear votes in this regard?
I yield the floor and thank the Senate.
Mrs. HUTCHISON. Mr. President, I will not take from my colleagues' time, but I would like to offer that there be an additional minute for the Democratic side as well.
Mrs. HUTCHISON. Mr. President, newspapers across the political spectrum, from the Wall Street Journal to the Washington Post, have questioned the desirability of a GSE bailout. The Washington Post editorialized that the bill would ``potentially increase the very risks the plan is intended to mitigate'' and asked: ``Wouldn't it be wiser to revamp the whole GSE structure, rather than construct an increasingly elaborate apparatus to address--or conceal--the fact that it no longer works very well?''
Mr. President, I ask unanimous consent to have printed in the Record at this point the Wall Street Journal editorial of July 24.
There being no objection, the material was ordered to be printed in the Record, as follows:
Mrs. HUTCHISON. Mr. President, there are 800 billion reasons why we ought to take our time to consider this bill. I think we should help alleviate the housing crisis, and I think most of this bill is good and solid, but it adds to the regulatory burden.
Mr. CARDIN. Mr. President, I know it is unusual that the Senate would be here on a Saturday, in a voting session, but I am pleased that we are here because at last we are going to have a chance to vote on final passage of H.R. 3221, the housing legislation that is so important to the people of this country.
I first wish to thank Senators Dodd and Shelby for the manner in which they have handled this legislation. It has been handled in a bipartisan manner, the way it should be. They have been extremely patient.
This bill has been on the floor on numerous occasions. There have been many opportunities for all of us to offer our suggestions on this legislation. It has been one of the most open bills we have had.
I know there are some on the other side of the aisle--my colleague from South Carolina--who raise certain objections. There are some who would like to see this matter further delayed. I understand that. In the other body, Republicans have decided to vote against this legislation by a 3-1 margin. That is their prerogative. And there are some in this body who believe the status quo is acceptable. They do not believe we should be aggressively trying to help the people of our communities in the housing
crisis. Well, I disagree with that, and I think the majority of this body disagrees, and it is important for us to provide the tools necessary to deal with the housing crisis in this country. Every day that we wait, 8,500 more foreclosures are here in America--8,500
people are in danger of losing their houses every single day. So, Mr. President, I am sorry we didn't get this legislation done earlier, but I am pleased we are here today to complete this legislation and to send it to the President for his signature.
We all know the current status of our economy. We know that people around this Nation are having a difficult time dealing with their everyday costs--dealing with energy costs, dealing with [Page: S7496]
health care costs, and, yes, dealing with their housing expenses. We know that the trigger to the current downturn in our economy was caused by the housing market. So it is important for us to pay special attention to the housing market as we try not only to help families
who are struggling to keep their homes and keep communities strong but also to help our economy.
This is true in each one of our States. In Maryland, in the second quarter of 2008, we saw a 130-percent increase in foreclosures. In my own State, 1 out of every 243 households is in some stage of foreclosure. This is a crisis affecting millions of people in our Nation. Maryland now ranks 16th in the Nation on foreclosures. The problem is continuing. There are subprime mortgages that are out there with adjustable rate mortgages that will be coming due during 2008 and 2009, and we will see more
and more foreclosures. So we need to act to try to prevent those foreclosures.
I know there have been some who have said: Well, look, this was a free market and people made their own decisions. But I can tell you of communities in my own State where homeowners were steered into subprime mortgages--homeowners who could have qualified for standard mortgages, but because of the way the fees were arranged, they were steered into these subprime products and are now in danger of losing their homes. So we need to do something.
I want to first acknowledge that there have been many groups that have stepped forward. Nonprofits in my State and around the Nation have tried to do what they can, and I applaud them for their actions. A lot of the people involved in the nonprofit housing sector have tried to help through counseling and other means, and that is laudable. In my own State, I applaud the efforts of our Chief Judge Bell, who has called upon the lawyers of Maryland to attend training sessions to offer pro bono services
to help homeowners who are in danger of losing their homes. I think that is what the bar should be doing, what lawyers should be doing, and they are stepping up to try to help. We also see State and local governments doing what they can to try to help in the housing market, and even private companies have stepped up to try
to restructure loans so that people can stay in their homes. All of that is what should be happening, and I applaud the efforts of the private sector and local governments. But the Federal Government should be a full partner in this effort, and I think H.R. 3221 moves us in a direction toward accepting that responsibility.
The bill helps current homeowners on the brink of foreclosure. It will provide $180 million for financial and legal assistance to homeowners who are in danger of losing their homes, which I think is very important. The legislation provides for counseling services to help counselors deal with individuals who are in danger of going into foreclosure on their properties. It also helps with refinancing. It is estimated that 400,000 people in this
country will benefit from the provisions of this legislation that allow for refinancing of their loans.
Some have said this is bailout. It is not a bailout. The loans are going to be bought at market value. Investors are going to lose part of their investment on these refinancings, as they should. It is not a bailout. And the homeowners who take advantage of it, it is to help them stay in their homes. If they sell their homes, part of the profits need to be returned. So it is a fair way to keep people in their homes, recognizing the fact that it is not only the individual homeowner who loses but
the entire community loses when a house is foreclosed upon.
I am particularly pleased with the provision in this legislation dealing with first-time homeowners. Several months ago, I talked to Senator Baucus about a housing credit for first-time home buyers to help more people become engaged in buying and selling homes. We know that 40 percent of home buyers are first-time home buyers, and by helping first-time home buyers, we help the housing market and we help the economy. I think the provision in this bill that will provide a $7,500 credit
or an interest-free loan will help. It is targeted to moderate-income families, and it is temporary. It needs to be used in the next year. It is reasonable from the point of view of helping people get back into the housing market, and I thank the committee for including that provision.
This legislation also deals with the credit crunch--the availability of mortgage money for those who need to buy homes. The FHA modernization will help, and the reverse-mortgage provisions that seniors use. Seniors who have lived in their home for many years have a lot of equity in their home. They need the cash out of their house in order to stay there, and reverse mortgages help them obtain the resources they need to deal with their health care and to deal with quality-of-life issues. This
bill modernizes the reverse-mortgage provisions, providing strong consumer protection provisions for our seniors.
We all know about Fannie Mae and Freddie Mac provisions and how we have tried to strengthen the regulatory system. I think that is what we should be doing. We are giving the Secretary of the Treasury the flexibility and authority that he needs in order to make sure we don't have a crisis in this country by Freddie Mac and Fannie Mae not being able to carry out their stated mission.
I am also pleased that the $11 billion for local mortgage bonding authority remains in this bill to help local governments deal with the availability of low-income housing.
The legislation also includes improvements to the CDBG funds by $4 billion, of which $89 million will be available to the people of Maryland. These are for the communities that are directly affected and have large numbers of foreclosed properties. This provision will allow the local governments to be able to buy foreclosed properties and turn them back and make them available for moderate-income families through home ownership and rental.
There is a provision in the bill that deals with veterans, through our VA home loan program, to prevent foreclosure and increase home ownership.
Lastly, there are provisions in this bill to help us in the future with better mortgage disclosure rules and nationwide loan originator licensing and registration.
The bottom line is, it increases the tools available in our toolbox to deal with vulnerable families who are in danger of losing their homes, it provides the financial wherewithal so that we can keep credit available for people to buy and sell homes, and it is a message and action to help our economy in these very difficult times. I am pleased we are able, at last, to vote on this legislation, and I urge my colleagues to support this very important bill.
Mr. President, I yield the floor.
Mr. SESSIONS. Mr. President, first, I appreciate particularly the work of my colleague, the senior Senator from Alabama, Mr. Shelby, who has, for quite a number of years, fought to improve oversight of the GSE, the Fannie and Freddie agencies that are so dominant in our loan market.
I am pleased, finally, now that we are in a crisis and the warnings he has raised for years, along with Senator Sununu, Senator Allard, and some others, that they now are willing to accept some significant oversight over these tremendously large institutions while, unfortunately, placing the taxpayers at risk.
So I think, all in all, with the crisis we are facing, I am inclined to support this legislation; although I am not, in general, happy we are in this circumstance.
I would like now to direct my remarks to the LIHEAP legislation. I think it is a curious thing. I know a lot of Members on our side, who are so frustrated about the inability to have a real debate about energy, will vote against the LIHEAP bill and going forward to it because they want to stay on energy legislation, in general.
I would suggest, however, the legislation that has been offered by my colleague from Vermont is bad policy. It is not good. We ought not to support it. Fundamentally, it does this: It subsidizes the burning of more fossil fuel. [Page: S7497]
That is an invariable law of economics, that which you subsidize you get more of. We are told, particularly by our green members--so many of them do come from the Northeast--that we ought to reduce fossil fuels. Yet we have a
piece of legislation that subsidizes, to a dramatic degree, fossil fuel use.
We had a little debate during the Presidential dustup in which we discussed cutting taxes on gasoline because the price of gasoline had doubled. People agreed that was bad public policy. This is worse. This is collecting tax money from various Americans and is giving it to others so they can buy more fossil fuels. I do not think that is good policy.
Second, it is the second LIHEAP bill we have had. The first one was $2.5 billion. We have done that one. Now we want to do another $2.5 billion that is unpaid for. It is a $2.5 billion direct increase to the debt of the United States of America. We are spending like drunken sailors, and that is unkind to drunken sailors.
We have already passed a $150 billion stimulus package to help people with higher costs and difficulties, and we sent out checks for that. We passed a $60 billion GI bill expansion. We passed a $50 billion foreign aid package for disease in Africa. We have added $14 billion to the Medicare fix. We are heading to this bill, this housing bill, that is going to cost and others.
We are going to more than double the deficit this year. We have to learn to say no. We cannot do everything we would like to do. The deficit last year was $177 billion. It is going to be $450 to $500 billion this year. That's unbelievable. We have to get serious about spending in general.
Also, the argument has always been this is for high heating oil prices. Well, I would suggest there is probably no more polluting, no more CO
2-creating fuel than fuel oil. It is a low-grade fuel. It is not the best kind of thing. Maybe we ought to be talking to our friends and colleagues who oppose so much drilling and production of oil and gas, perhaps we should begin to talk about how solar or wind could deal with their problems.
But I suspect, when it comes to their own neighborhood, they know solar and wind are not so easily done and would actually be more expensive than heating oil.
Mr. SANDERS. Mr. President, the Senator from Alabama said that what the LIHEAP legislation is about is subsidizing fossil fuels. No, that is not accurate. What the LIHEAP legislation is about is keeping people alive in Alabama, in Arizona, in Texas, in Vermont, in Maine, and all over this country. The Senator from Alabama should know that people are dying this summer, when the heat gets to 110 degrees and when electric rates are soaring and they do not have the money to pay those electric bills.
The Senator from Alabama and others should know the CDC, the Centers for Disease Control, have made it very clear that more people die from extreme heat exposure and exposure to the cold than all other natural disasters combined.
Let's be clear what we are voting on this morning. When the Senator from Alabama and others say: Well, we are spending money trying to keep the elderly and the sick and children alive when the weather gets 20 below zero, we are. I will vote for those proposals, rather than hundreds of billions of dollars in tax breaks for the wealthiest 1 percent.
I will vote to make sure people in Vermont do not freeze in the winter, while we give tax breaks to ExxonMobil that
enjoys recordbreaking profits. That is what we are talking about, priorities. Do we keep the old and the sick and kids alive when the weather gets cold or when the weather gets very hot or do we spend money on people who make huge campaign contributions? That is part of what this debate is about.
Mr. SANDERS. I have the floor. I will not yield.
Some other people are saying what we should be talking about is energy policy. Well, of course, we should. The energy policy of this country is way out of whack. We are spending $700 billion a year importing foreign oil. We need to move to sustainable energy. We have not moved to energy efficiency. There is an honest debate about where and how much drilling should take place. But that is not what this debate is about.
Since 1981, we have had LIHEAP. It has been supported in a bipartisan manner from everybody from President Bush on down. It is a program that has worked. What everybody in this Chamber understands is the price of home heating oil is soaring, the price of electricity is soaring, and the people will become sick and die and be forced to leave their homes if we do not significantly expand LIHEAP funding in order to make sure they can pay their bills.
Let me reiterate to my friend from Alabama or anybody else: This is not a cold-weather State bill. Am I worried about what is going to happen in Vermont this winter? You can bet on it.
Mr. SANDERS. In Philadelphia, PA, in June, 17 people died from heat exhaustion. In Arizona, over the years, hundreds of people have died because they lack the ability to stay cool in the summer.
This legislation is supported by the AARP because they understand, the largest senior group in America, what will happen to older Americans if it is not passed.
This legislation is supported by the National Governors Association because they know the financial problems facing States and the need for the Federal Government to act. This legislation is supported by the Southern Governors Association because they know what hot weather does to peoples' health, especially the old and the sick when they cannot stay cool.
What we are dealing with is literally a life-and-death situation. People in the hot-weather States will die when temperatures get to be 115 degrees, and they cannot afford the electricity to stay cool with air-conditioning.
People will die in the Northern tier when the weather gets 20 below zero, and they cannot afford the high cost of home heating oil or gas.
The American people are sick and tired of all the partisanship which is going on. Every Member of the Senate can write a press release telling their constituents why they voted no. But you know what, I do not think the people are going to believe you. If we have enough money for tax breaks for ExxonMobil, we have enough money in this country to make sure people do not freeze to death and that people do not die of heat exhaustion.
I hope we can come together while we disagree about other aspects of energy policy. I hope we can finally come together and go back home, whether it is to the South or the North, and tell the American people, we understand what high energy prices are doing to them. We are going to stay with you. We are not going to let the most fragile people in our country, the most vulnerable people in our country, suffer unnecessarily when we know how to help them. [Page: S7498]
I yield the floor.
Mr. DODD. Mr. President, before he leaves the floor, let me commend our colleague from Vermont for his eloquence and his passion this morning on a subject that, as he says, ought to unite all of us, regardless of geography or political party.
I would be remiss if I did not recognize, as well, that the Presiding Officer today has been a champion of this issue during his tenure in the Senate. I thank the Senator from Rhode Island for his passion about this issue as well.
In the quarter of a century that I been here, as the Senator from Vermont has pointed out, this issue has been an issue that has not divided us along these lines. There have been those who, from time to time, have opposed low-income energy assistance but, by and large, this is a matter that has enjoyed broad bipartisan support.
While we are in the depths of the summer today, and there are those who are wondering what we are talking about, we talk about home heating oil and gas for the winter, we are only days away from those temperature changes.
Of course, for those who live in our southern States, the issue of heat exhaustion is something they live with all the time. And low-income energy assistance, as the Senator from Vermont points out, cuts across all geographical lines. It is the basic necessity. You cannot survive without it. Over the years, we have been able to do something to support it.
So I urge our colleagues, when the vote occurs later this morning on this issue, that we join on this matter and support the effort to provide for that low-income energy assistance.
I commend my colleague from Vermont, who has been patient about this issue over the last number of weeks. My hope is it will be supported. I hope we do on low-income energy assistance what we have done on housing.
I note the presence of my colleague from Alabama, Senator Shelby. I wish to begin my remarks by thanking my friend from Alabama. I thank him and our colleagues, Democrats and Republicans, on the Banking Committee.
The Presiding Officer and others, by a vote of 19 to 2, we came out of our committee back in March on a housing proposal. We have worked closely together over these last number of weeks in order to bring us to this moment, which I wondered if it would ever occur, given the number of times we have voted on this matter since March.
But in about 30 minutes, we are going to have a chance to finally decide whether this Congress is going to do something about the growing economic problems, basically founded and anchored in the foreclosure crisis of our Nation, that has now spread far beyond residential mortgages.
It is long overdue that this Congress respond. We are about to do so in a bipartisan fashion. Given the vote yesterday of 80 to 13, it is an indication of this what this body can do when we are determined to work together to make a difference.
So I wish to thank--I see my colleague from Georgia--Senator Isakson and others who have done a terrific job in packaging this proposal. If each one of us could write this alone, it would be different. We serve in a body of 100 Members. We need to work together to develop final products.
This is an example of what can happen when that occurs.
I am pleased we are finally ready to pass the Housing and Economic Recovery Act of 2008 and send it to the President's desk for his signature. This has been a long and arduous process. It started when Leader Reid, who has been remarkable and marvelous in this process, Leader McConnell, Senator Shelby and I, announced on March 31 that we were going to put together a bipartisan housing stimulus bill that would address the growing housing crisis. Not much more than 24
hours later, Senator Shelby and I, along with Senators Baucus and Grassley, brought the first version of the Housing and Economic Recovery Act to the floor where it received an overwhelming vote of 84 to 12. We continued to work over subsequent months to expand and improve the legislation so it would more thoroughly address the growing foreclosure and financial crisis. This is the product we present to our colleagues this morning.
This action is coming none too soon. Earlier this week data was released showing that home sales hit a 10-year low, falling 2.6 percent, over twice as much as what had been expected. Home prices continue to fall. The Census Bureau reported that foreclosures contributed to a record number of vacant homes in the second quarter. Merrill Lynch reports that June numbers show we now have 11 months of inventory of single-family homes. That is a 23-year high.
RealtyTrac reported yesterday that forecloses in the second quarter more than doubled from a year earlier and jumped nearly 14 percent from the previous 3 months. As you have heard me say over and over, every day between 8,000 and 9,000 of our fellow Americans are put into foreclosure. There have been a record number of bank seizures as well. This is happening in the United States. It simply ought to be unacceptable to every single one of us.
Bill Gross, the CIO of PIMCO, one of our largest investment funds, estimates our economy will face nearly $1 trillion in mortgage losses when it is all said and done. Martin Feldstein, who served President Reagan as chief economist, wrote in the Wall Street Journal in March:
The 10 percent decline in house prices has cut household wealth by more than $2 trillion, reducing consumer spending and increasing the risk of a deep recession.
This is a staggering loss of wealth we are seeing, coming at the very same time, as the Senator from Vermont has pointed out, that food prices, gas prices, health care, and education costs are rising. We are experiencing the worst of all possible worlds. Wealth is declining, the source of wealth creation, and costs are rising simultaneously. Moreover, when we consider the role that home equity has played in supporting consumer spending, we see the danger a vicious downward cycle could create,
an economic disaster for our country.
Don't let yourselves be dulled by nameless and faceless statistics either. Behind each one of these numbers I have recited, there is a family--a mother, a father, children trying to grow up, facing unemployment, losing their homes, wondering what the future holds. So when we talk about the numbers, about how important this data is, pause for a minute, when deciding whether to support this bill, and remember: Behind every one of those numbers there is an American family who this morning is wondering
whether their Congress can do anything at all about the problems they face.
In about 30 minutes, we will have an answer for that, I believe, an overwhelming one, that says: We are on your side. We want to make a difference to keep you in your homes and get back on your feet again. That is what this is all about--not the numbers but the faces. Those families are counting on us. In the face of these daunting challenges, I believe we all have a responsibility to act. That is what we are going to do this morning by passing this bill.
Let me quote again Mr. Gross of PIMCO, who wrote this past Thursday:
..... the omnibus housing/GSE bill now placed before the Congress and the President is the best way to begin the long journey back to normalcy [in this country].
I believe that to be the case. Treasury Secretary Paulson said the passing of this legislation is the most important action we can take to address the housing crisis.
This legislation will not perform miracles. I want the American people to have a realistic expectation as to what we are about to do. But as others have said, it is a step--I hope and expect an important step--toward putting our Nation on the road to economic recovery. Let me sum up the legislation very quickly before turning to my colleague from Alabama.
The bill establishes the HOPE for Homeowners Act to help at least 400,000 to 500,000 families stay in their homes. It does so after asking both lenders and borrowers to make financial sacrifices, and it does so at absolutely no cost to the American taxpayer.
The bill creates a new world-class regulator for Fannie Mae and Freddie Mac and the Federal Home Loan Banks. Recent news makes it clear these entities need a stronger regulator to ensure they are viable and healthy institutions, able to provide credit in times of stress such as we are experiencing today. It also raises loan limits [Page: S7499]
from $417,000 to a high of $625,000 so the government-sponsored enterprises can play an even more active role in stabilizing
the housing market.
At the request of Secretary Paulson, the legislation includes standby authority for the Secretary of the Treasury to purchase the stock or debt of the housing GSEs only if he finds such action is necessary to keep the financial markets stable and mortgage credit flowing. It is our strong expectation that creating this authority will make it unlikely that it will ever be needed. As I have said, the GSEs have significantly more capital than is required by law. They continue to have open access
to the debt markets, and their holdings consist primarily of 30-year fixed rate mortgages.
The bill modernizes the Federal Housing Administration program, raising the loan limits from $362,000 to $625,000 so that 98 percent of the counties in the United States and 85 percent of the population will have access to this important program. FHA has proved its value in the current crisis, as it has continued to provide a stable source of mortgage credit even while many other lenders have failed.
The bill includes a permanent, affordable housing fund financed by Fannie Mae and Freddie Mac that will provide tens of thousands of affordable housing units. I tip my hat to the Presiding Officer, who has been a tireless champion on behalf of affordable housing. With the work of Senators
Shelby and Reed, we have a permanent, affordable housing program, the first time ever in our history. The bill includes new protections for elderly homeowners taking out FHA-insured reverse mortgages so they are not deceived, as many have been, into using the proceeds from these loans to buy expensive and needless insurance products. These provisions were incorporated from a bill introduced by our colleague from Missouri, Senator McCaskill.
The bill includes a new mortgage broker and lender licensing requirement added by Senator Martinez, with strong support from Senator Feinstein, that will begin to address the many abuses of the mortgage process perpetrated by brokers. In addition, it includes improved disclosure requirements added by Senators Reed and Bond. Because of the efforts of Senators Kerry, Coleman, Akaka, Cornyn, and Sanders, the bill expands
the availability of the VA housing program and includes a number of provisions to help returning veterans save their homes from foreclosure, and provides new housing benefits to disabled veterans. The legislation includes $3.9 billion in emergency Community Development Block Grant funds for areas hard hit by foreclosures, to help them purchase and rehabilitate these homes and put them into productive use. As the Boston Globe wrote in an editorial earlier this month:
The major beneficiaries [of this provision] would be the urban homeowners to pay their mortgages diligently yet face declining property values, crime, and blight associated with a rash of foreclosures near their homes.
This body has repeatedly provided emergency funds to communities ravaged by floods, hurricanes, and natural disasters. The foreclosure crisis is every bit as much of a disaster. This is an emergency equally deserving of these funds.
Finally, the bill includes $150 million in new counseling money. Housing counselors have been our troops on the frontline, working with troubled borrowers and lenders. These funds, which were included at the request of Senator Murray, along with Senator Schumer, will result in tens of thousands of American families being able to keep their homes.
Let me close by saying again this legislation is the product of tireless collaboration in the Senate and the other body, the House of Representatives, with the work of Barney Frank and his colleagues on the Financial Services Committee and, of course, the administration, particularly Secretary Paulson and his staff, to help develop solutions that will strengthen our economy, restore confidence in our financial markets, and provide urgently needed relief to American families struggling
to make ends meet. Such an outcome could not be possible without the full support and leadership of my colleague and ranking member, Senator Shelby. Every vote we have taken on this bill, from the 19-to-2 vote in committee to yesterday's 80-to-13 vote on cloture, has been strongly bipartisan. The American people can take some pride in this institution for our willingness to work together through these difficult issues to get such a good outcome.
Finally, legislation of this magnitude takes hours and hours of staff time to work out. There is never going to be an adequate expression for Senator Shelby and me to thank our staffs on the Banking, Housing and Urban Affairs Committee. They have been remarkable, beginning with the Senate staff director, Shawn Maher of my office, along with Jonathan Miller, Amy Friend, Roger Hollingsworth, Aaron Klein, Julie Chon, Jenn Fogel-Bublick, Sarah Kline, Kate Szostak, and Drew Colbert; legislative
counsel Laura Ayoud and Rob Grant; Senator Shelby's staff--Bill Duhnke, Mark Oesterle, Peggy Kuhn, Jim Johnson--and from Senator Reed's staff, Kara Stein.
I thank Senator Harry Reid lastly, our majority leader, for his diligence, patience, and determination. We have been through six cloture motions, delay after delay after delay by a handful of Senators who were determined to do everything they could procedurally to stop us from getting to this moment. I thank immensely the majority leader, and his staff as well, for their tireless support of this effort.
Again to my colleague from Alabama, I tip my hat. He is a good man to work with, and I thank Senator Shelby.
Mr. SHELBY. Mr. President, I rise to speak in support of the final passage of H.R. 3221, the legislation before us Senator Dodd and others have been talking about. This legislation contains numerous provisions that address a wide variety of issues associated with the housing crisis. Many of them, in fact, were previously considered and passed by the Senate in earlier versions of this bill right here on the floor. I wish to highlight a few of these important provisions now.
As the Presiding Officer well knows, because he is an important player in this and a very important member of the Banking Committee, this final package contains the same mortgage refinance program included in the earlier bills. This is a temporary, voluntary program within the Federal Housing Administration to back FHA-insured mortgages to distressed borrowers. It requires both mortgage lenders and borrowers to give up some of their financial interest in order to participate. The mortgage lender
must agree to reduce the principal balance of the loan, which we also call a ``haircut.'' The loan refinancing arrangement must also bring the loan-to-value, LTV, ratio on the new loan to no greater than 90 percent of the property's current appraised value. Borrowers must accept an equity-sharing requirement and forgo a percentage of any future profits on the sale of their homes.
While I would prefer a completely free market solution, at least this program is designed to keep the taxpayer from bearing the cost, something I fought hard for in the Banking Committee. We have included a separate funding stream that carries on in perpetuity to cover any costs that may arise.
This package also includes measures which modernize the FHA program. But by streamlining and expanding it, we hope the program can make safe, fixed-rate mortgages more readily available to home buyers in the United States.
The legislation also includes a first-time home buyer tax credit of $7,500. I believe this should serve as an additional incentive to potential first-time buyers who may be waiting to purchase a home. The tax credit, combined with the greater availability of sustainable mortgages, should encourage buyers and help invigorate the housing market.
While I support this bill, there are a number of provisions in it with which I am very concerned. If it had been my decision alone, I would not have included them. While crafting legislation requires a great deal of give and take, one thing we should not compromise is our obligation to conduct continuing oversight of the programs we enact. Our responsibility to the taxpayers requires that we continue to closely track the funds we are providing. We [Page: S7500]
not tolerate the waste or misuse of a single tax dollar. It is my hope that my friends who demanded additional spending are as enthusiastic about accounting for tax dollars as they are about spending them.
The bill coming back to us from the House does contain a set of entirely new and significant provisions. These provisions were added at the request of Treasury Secretary Paulson, who determined that such measures were needed immediately as a result of the rapidly deteriorating financial condition of Fannie Mae and Freddie Mac.
The legislation provides, as the Presiding Officer knows, the Secretary with temporary authority to purchase debt or equity of the GSEs when he, the Secretary, determines that such action is required to stabilize the financial system, protect taxpayers, and prevent disruptions to the mortgage markets.
I recognize the unprecedented nature of the authority this legislation provides to the Secretary of the Treasury. It is not something I agreed to without a great deal of consideration. In my estimation, however, the risks of not providing the authority ultimately outweigh the risks of extending it. I said recently I feared we were sitting on a financial powder keg. I think a lot of people realize that.
Fannie Mae and Freddie Mac, independently and together, represent considerable risks to the financial system. They each hold portfolios in excess of $700 billion. They each guarantee more than $2.5 trillion in mortgages. Their debt is held as regulatory capital by hundreds, if not thousands, of American financial institutions. They serve as counterparties on derivatives contracts with hundreds of firms, located domestically and abroad, in amounts in the trillions of dollars.
For years, I have argued on the Banking Committee that these entities, due to their size and their reach in the financial markets, pose a risk to the global financial system. I have also argued that such systemic risk requires the appropriate regulatory framework to prevent total financial calamity should one of the firms face a crisis.
Unfortunately, over the years, my calls for regulatory change were not only unheeded but were rebuffed. Consequently, we were denied the chance to put a strong regulator in place when it could have made a difference. But we are where we are today.
What has happened in the meantime seems to be the inevitable result of our failure to act. Indeed, when it became clear that both of the GSEs were on dangerous financial ground, it was no surprise to me that the Secretary asked for such a substantial grant of power and authority. Entities of such size and risk can only be helped by the commitment of a massive amount of resources.
Upon the passage of this bill, such resources will be available, if necessary. I hope they will not be necessary.
It is unfortunate it took the near collapse of Fannie Mae and Freddie Mac to convince a number of my colleagues that these entities do indeed pose a systemic risk to the U.S. and global economies. Nevertheless, I am pleased this legislation now acknowledges and addresses that reality in statute by giving the Federal Reserve a role in advising the new regulator on risks to our financial system.
Although the Fed's role, as the Presiding Officer knows, is temporary, it is now well established that the systemic risks the GSEs pose are permanent. That debate is basically over. The only question now is to whom the Congress assigns that responsibility in 18 months.
Since beginning the process of developing this legislation, I have believed the most important aspect of the bill is that it establishes a strong independent regulator for the GSEs. Intervening events have further confirmed my belief.
We have provided this new regulator with enhanced powers and additional authority so it has the tools necessary to ensure the GSEs are properly regulated. In doing so, I believe we are taking a very important step to prevent a repeat of the crises that enveloped Fannie Mae and Freddie Mac.
We find ourselves at the end of a long legislative road. The time for the debate has ended, and it is now time to vote.
Mr. REID. Mr. President, I would yield 3 minutes to the Senator from New York, Mr. Schumer. No, he doesn't want it. OK. That is unusual.
I wish I had the words to express adequately my appreciation for the work done by the chairman of the committee and the ranking member of the committee. Senator Dodd and Senator Shelby have done a remarkable job under tremendously difficult circumstances to get where we are today. They were for this piece of legislation before Fannie and Freddie got into big trouble because they knew and they could see the problems with the housing industry. The fact that Fannie and Freddie
got into trouble only made it more imperative that these two managers of this legislation move forward more rapidly. They have overcome tremendous obstacles.
We have had seven cloture votes on this housing bill. I do not know if in the history of this country we have ever had a single piece of legislation with that many cloture votes, but we had them on this bill. These two very fine legislators--one from the State of Connecticut, with a totally different economy, different political base than that of the State of Alabama--worked together for the good of the American people. I so admire and appreciate the work they have done under, I repeat, very
For most Americans, yesterday, Friday, was an ordinary summer Friday. But for about 8,500 families, it was a terrible day because, when they got their mail, there was a foreclosure notice or, when they opened their door, they found on their door a notice of foreclosure or, when they opened the door on Friday, there was someone at the door serving papers on them, moving the legal process forward--foreclosure notices. But they joined, yesterday, 8,500 who received their notice the day before and
the day before that and the day before that and the day before that and the day before that.
During the process of this legislation moving forward, that we should have passed fairly quickly--within, at the most, a week--hundreds of thousands of people received foreclosure notices. Well, 8,500 families will not receive their foreclosure notices today or tomorrow but only because the courthouses are closed for the weekend. On Monday, the drumbeat of foreclosure will continue.
In Nevada, 1 out of every 43 families who have a home now have their home in foreclosure. It is almost the same in Arizona and almost the same in California and almost the same in Florida. There are only two States in the country that do not have the problem, one of which is the State of Alabama.
But for families who face each day with trepidation because of a foreclosure concern they have, hoping a notice has not arrived, in some fashion--but knowing it may soon--a foreclosure notice is something that is a terrible day in their lives. But today, this Senate will deliver some rare and much-needed good news for people who own homes throughout America. Not only will it help those people who own homes but neighborhoods, communities, States, local governments and servicers and lenders.
We are on the verge of passing a bipartisan housing bill that will help rebuild communities, safeguard future housing meltdowns, and, most importantly, help at-risk families keep their homes. Because of the work in this legislation dealing with Fannie and Freddie, the financial community in America will be stabilized.
It has taken far too long to reach this point where we are today. We have talked about that. The housing bill was introduced in February and work began in the fall of last year.
Now, I have already talked about Senators Dodd and Shelby. During the process of working to get legislation that they thought was appropriate to bring before this body, they both received pressure from their respective caucuses, from editorials: Why aren't they doing something more rapidly? They wanted to bring something to the Senate that would pass. They wanted to work with the House on something that would pass both bodies and be signed by the President. So, again, I underscore
the great legislative work these two gentlemen did.
Not only have we had seven cloture votes but we have had Presidential veto threats. Thank goodness those threats have been withdrawn.
As some Republicans have continued to stall, families have continued to lose their homes. And note I said ``some'' Republicans, not all Republicans in the Senate. But today, at long last, a ray of hope--a chance to turn the page on the housing crisis and begin a new chapter that gives more families a chance at the American dream of responsible home ownership.
Now, we are going to move--after we complete legislation on this housing bill--to LIHEAP. We would not have the opportunity to vote on this most important measure, this energy legislation, but for one Senator, a Senator from the sparsely populated State of Vermont, Mr. Bernard Sanders. It is because of his advocacy for months and months that we are going to have an opportunity to vote on this. He has worked on legislation. We have Republicans who support and have agreed to support his
legislation. We are going to move to proceed to that.
Now, my friends on the other side of the aisle have expended countless hours of floor time and many barrels of ink talking about the need to do something about energy prices. While they have endlessly talked, the Democrats have been proposing comprehensive solutions.
Yesterday, Republicans refused to join us in a bill to stem the excessive [Page: S7506]
speculation by Wall Street traders who artificially bid up the price of oil for their own profit. That was a plan Republicans had claimed to support previously. It was part of their legislation. When it came time to take action, the monied interests of this country backed the Republicans down from doing the right thing.
When we offered the Republicans a vote on the very thing they claim to want more than anything--offshore drilling--they
passed on that. They said no.
Now, Democrats are proposing improvements to the LIHEAP program. This is yet another bipartisan opportunity to help Americans cope with our energy crisis.
This is something that is a crisis that has been here for a while. Listen to what George Bush, the President of the United States, said. This is a quote:
First and foremost, we've got to make sure we fully fund LIHEAP, which is a way to help low-income folks, particularly here in the East, pay for their high--high--fuel bills.
A direct quote from President Bush.
This legislation assists senior citizens, low-income families, and those who are disabled to afford to heat their homes in winter and cool them during excessive periods of heat in summer.
There are not many States like Nevada. In the southern part of the State, in Laughlin, NV, it is not unusual for the temperature to hit 120 degrees. In the northern part of the State, in places such as Owyhee, it is the coldest place in the Nation on many occasions. It is not unusual at all for it to be 20 degrees below zero. These ranges in temperature indicate that if you are old, if you are disabled, if you are poor, you have trouble paying for the fuel costs to cool your home to survive or
to heat your home to survive. People who have temperatures above 100 degrees know how important it is to keep their home cool, and people who are freezing know how important it is to keep their house warm.
Since 2001, Americans are paying three times as much for heating oil and twice as much for propane. As these energy costs have skyrocketed, these LIHEAP proposals we have talked about have been hamstrung. These programs are not there to provide the necessary assistance. As the winter months are growing near, this problem will exacerbate. It will grow worse.
This legislation has rightly earned bipartisan support, as I have talked about, with at least a dozen Republican cosponsors of the Senator's legislation. It is regrettable Republicans could force us to waste valuable hours on a cloture vote on proceeding to this legislation--even allowing us to debate the matter. It is unimaginable Republicans might choose to block us from passing this worthy legislation for which President Bush said: ``First and foremost, we've got to make sure we fully fund
LIHEAP, which is a way to help low-income folks, particularly here in the East, pay for their high--high--fuel [costs].''
Well, it is not only folks in the East. It is folks in the West and Midwest and all over this country. I hope they will not stall this. They say they want to legislate on energy. They had the chance yesterday. They did not take that. They have a chance again today. We will soon see what they choose to do.
If Republicans choose to join us in passing LIHEAP, we will welcome their votes, certainly, with open arms. But if they choose to block this legislation, they will have to shoulder the burden of millions of low-income families, senior citizens, and those with disabilities who are struggling and suffering to pay their ever-rising energy bills.
Mr. REID. Mr. President, I know everybody is concerned about what is going to happen tomorrow and Monday. We won't know until after the next vote is cast. Within an hour or so after the final vote, all of the offices will know what will happen either tomorrow and/or Monday. We will have more definite information after the next vote.