1:38 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. Madam Speaker, for purposes of debate only, I yield the customary 30 minutes to my friend from Texas (Mr. Sessions), and I yield myself such time as I may consume.

GENERAL LEAVE

1:38 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. I ask unanimous consent that all Members be given 5 legislative days in which to revise and extend their remarks on House Resolution 1490.

1:38 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. Madam Speaker, House Resolution 1490 provides for consideration of the conference report to H.R. 4173, the Dodd-Frank Wall Street Reform and Consumer Protection Act. This rule provides for 2 hours of debate on the conference report, it waives all points of order, and, further, the rule provides for one motion to recommit, with or without instructions.

Madam Speaker, today we will take an historic vote on the most significant reform to our financial industry since the New Deal. These comprehensive reforms will reduce threats to our financial system, increase oversight and prevent future bailouts. The bill strikes a responsible balance, ending the ``wild west'' era on Wall Street, while laying a new regulatory foundation for long-term growth which is stable and secure.

[Time: 13:40]

In the fall of 2008, this country was brought to its knees by a financial crisis, the likes of which I hope we never experience again. A crisis of this magnitude calls for reforms of similar proportion. Many elements on and off Wall Street contributed to the meltdown, and this bill carefully crafts responsible solutions in each area. The bill [Page: H5224]

protects consumers through the creation of a Consumer Financial Protection Bureau that will oversee the loan

writing for banks and nonbanks and serve as the primary watchdog for consumers. For the very first time, nonbank entities will have Federal oversight, a critical element to reining in abusive practices and products. An oversight council is established under this bill to make certain financial institutions do not become a systemic threat to our economic stability.

We establish a process to close and liquidate significant financial institutions so if a failing firm begins to fail, it is closed, and it will no longer be too big to fail. This dissolution mechanism ensures Main Street comes first--not Wall Street. We deal with hedge funds, credit rating agencies, mortgage reform, executive compensation, and investor protection in this bill. We bring these issues out of the shadows and into the light so there is transparency to protect the system.

I worked to ensure a study on high frequency trading was included in this bill. As we saw from the ``flash crash'' in May, when the Dow Jones lost nearly a thousand points in a matter of minutes because of computer error, we need to know the effects of technologically advanced practices such as high frequency trading on the long-term investor. Also, transparency will be brought to the derivatives markets. Businesses and manufacturers will be able to reduce their own risk while protections are

put in place for the overall system, providing regulators with a clear picture of the derivatives market.

Another important provision in the House was strengthened in conference. It calls for strong limits on proprietary trading, or what most are calling ``the Volcker rule.'' This provision strikes a good balance in banning proprietary trading without disrupting client services and asset management. In other words, banks can no longer gamble with their customers' money. The bill we are considering here today ensures there is no place to hide by closing loopholes, improving consolidated supervision,

and establishing robust regulatory oversight.

I'm proud to stand here with my colleagues today providing for consideration of a bill making the necessary reforms and establishing robust regulatory oversight. In this bill we protect consumers, taxpayers, and depositors. I urge my colleagues to vote in favor of the rule and the underlying bill.

I reserve the balance of my time.

1:42 PM EDT
Pete Sessions, R-TX 32nd

Mr. SESSIONS. I thank the gentleman from Colorado, my friend, for yielding me time, and I yield myself such time as I may consume.

Madam Speaker, I rise in opposition to this closed rule and the underlying bill.

Today, we are considering a 2,300-page Federal takeover of the financial services industry. This happened in health care. It's now happening in financial services. The bill before us today is just one more piece of the Democrat majority's agenda to Federalize more of the private sector of this country. I hear that as I travel in my district. Madam Speaker, while it's important to provide consumer safety and security in the marketplace and to minimize the chance of another financial crisis, I

oppose this bill.

I oppose this bill, and the underlying legislation holds many far-reaching consequences for the American economy and prohibits the ability of business, small and large, to create jobs and spur economic growth. Obviously, this bill, because it's done by the Democrat majority, will be 2,300 pages; obviously, because this bill is done by the Democrat majority, it will involve new Big Government plans, programs; and, obviously, because it's the Democrat majority, it will involve more taxes, fees,

and in fact it's $18 billion worth of new spending through these fees and taxes. In addition to making bailouts permanent, which this bill does do, failing to address the root cause of the crisis and rewarding failed regulators, this Democratic solution makes it even more difficult for consumers to access credit and for businesses to comply with overburdensome regulations.

Just a few minutes ago, we heard the story about how Republicans want to do nothing. Republicans would do nothing because they're opposed to rules and regulations in the marketplace. That's not true. We already have enough rules and regulations in the marketplace. And I do agree there's some things in here which do add to the safety and soundness features. But in the overall total, it's a bad deal. It's a bad deal for consumers, it's a bad deal for this country, and it's certainly a bad deal

for anyone that wants to turn the corner on growing jobs in America.

In a letter from the Independent Bankers Association of Texas, my home State, while referencing the new Consumer Financial Protection Bureau created in the bill, it states, ``this agency will have broad powers to write rules on all bank products and services, which we believe will stifle innovation and entrepreneurship on longstanding products that have been responsibly offered by community financial institutions. This will result in more cost and confusion to bank customers and stifle lending

and funding in community banks.''

Community banks represent the lifeblood of Texas. I know this because I know a number of the banks and the people not only who lend with them but the people who rely on them day by day. I'm one of those persons. They're worried about what is happening here in Washington. Once again, they were given a reason to have fear of what has happened over the weekend in this bill becoming even closer to law.

The Consumer Financial Protection Bureau and the Office of Financial Research, two brand new Federal agencies created in this bill--once again, two brand new Federal agencies created in this bill--will give unelected bureaucrats unprecedented power to track financial activities without citizens' approval. And these are not the only new regulatory components of the bill. This legislation allows for 355 new rulemakings, 47 studies, and 74 reports, and potentially dozens more as implementation

begins. But what should we expect from this Democratic Congress?

The goal of regulatory reform should be to help, not hinder. It should be there to help our economy to sustain and gain back economic growth. And, of course, gain back private-sector job creation--not government jobs. This legislation, of course, does the opposite. It takes a one-size-fits-all approach to governing, undermining U.S. economic competitiveness and private-sector growth. This Democrat solution will only increase government intervention in the financial markets. It will ration credit.

It will limit consumer choice. And, perhaps worst of all, it will continue to kill jobs. I'm sorry; private-sector jobs. I need to get that right. We're all for government jobs when it's a Democratic bill, but when it comes to free-enterprise system jobs, we want to kill those things. This is the hallmark of the Democratic Party, whose party--and I know this, this

is just part of it--but the three largest political items of the Democrat majority, Speaker Nancy Pelosi: To net lose 10 million American jobs through cap-and-trade, through card check, and through health care. Once again, we should have included that in that list--jobs that are killed in the free enterprise system by this Democrat majority.

[Time: 13:50]

Madam Speaker, the motives are clear. My Democrat colleagues are using policy and regulation to force a further government takeover of the free enterprise system while paving the road to diminish the private sector. This is their way of making sure that they use a crisis or a perception of a crisis to get what they want. I get it, and so do people back home. Madam Speaker, the Republican Party and my colleagues in the Republican Party are opposed to this bill. I encourage my colleagues to vote

against this rule and the underlying legislation.

I reserve the balance of my time.

1:49 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. I will just take one moment, Madam Speaker, to remind my friend from Texas that by cutting taxes for the wealthiest Americans, prosecuting two wars without paying for them, and letting Wall Street run amok, in the last month of George Bush's term in office, we lost 780,000 jobs that month. This country lost a lot of jobs. By not enforcing reasonable regulation, we lost all sorts of jobs. But since January, February of 2009 until last month, we reversed that to the point where

there were 400,000 jobs created, a swing of over 1.2 million jobs per month in this country. My [Page: H5225]

friends on the Republican side of the aisle oppose reining in Wall Street. We know, and Americans across this country know that something has to be done.

With that, I yield 3 minutes to my friend from California, Congresswoman Matsui.

1:50 PM EDT
Doris O. Matsui, D-CA 5th

Ms. MATSUI. I thank the gentleman from Colorado for yielding me time.

Madam Speaker, I rise today in strong support of H.R. 4173, the Restoring American Financial Stability Act of 2010. Many families in my home district of Sacramento continue struggling to make ends meet. I have heard countless stories of those struggling to keep their homes, their jobs, and their way of life. Many of my constituents were and continue to be victims of predatory home loan lending, unfair credit card practices, payday loans, and other forms of deceptive financial practices. The mortgage

crisis, in particular, continues to impact many in Sacramento. Sadly, after more than 2 years, millions of homeowners continue to face foreclosure, and those who have not have seen the value of their homes plummet.

I have been to foreclosure workshops. I have seen the hardships and looks of desperation. I have heard from a constituent who held a traditional 30-year mortgage; but after repeated attempts from her lender, she was convinced to refinance her mortgage to a lower adjustable rate. And now that the mortgage has reset, she is facing foreclosure. I have heard from many constituents who applied for a loan modification but never even got a call back. I have heard from many others who say they were denied

a loan modification under the Making Home Affordable program, but their lender never even gave them a reason why. These are just a few of the many stories that I, and I'm sure many of you, have heard.

Madam Speaker, no one is looking for a bailout. The families need real assistance and real reform. But it's clear that the mortgage industry, after repeated public pledges, has yet to demonstrate a real commitment to help responsible homeowners. Madam Speaker, I am pleased that this bill includes an amendment that I offered along with Representatives KATHY CASTOR and Betty Sutton which calls on the mortgage industry to help place more responsible homeowners into more affordable

terms. The amendment will require mortgage industry participants in the Making Home Affordable program to report basic information on a monthly basis, such as the number of loan modification requests received, the number being processed, the number that have been approved, and the number that have been denied. It will also make that information available to the public through the Treasury Department's Web site.

It is clear that greater transparency is needed to ensure that all parties are actually helping homeowners. Such transparency will lead to greater accountability. I strongly urge my colleagues to support this historic legislation to ensure that our consumers and our financial system are protected from irresponsible financial practices.

1:53 PM EDT
Pete Sessions, R-TX 32nd

Mr. SESSIONS. Madam Speaker, our next speaker is a young gentleman from Texas who has a clear voice and a sound footing not only of economic principles but he also speaks for our party.

I yield 3 minutes to the gentleman from Texas (Mr. Hensarling).

1:54 PM EDT
Jeb Hensarling, R-TX 5th

Mr. HENSARLING. I thank the gentleman for yielding.

I was very interested, Madam Speaker, to hear the gentleman from Colorado defend the job statistics under the Democratic rule of Congress. I don't know too many Democrats coming to the floor who want to defend 9.7 percent unemployment. Frankly, it's one of the major reasons that the legislation on the floor ought to be opposed today. Madam Speaker, it's a job killer. Once again, we have legislation that will make credit less available and more expensive.

Let me point out four different aspects of this bill. No. 1, it creates a permanent Wall Street bailout authority. If you build it, they will come. You build a bailout authority because you expect to bail people out. There's a choice to be had here. Republicans believe in the Bankruptcy Code. There are improvements that need to be made; and under the leadership of our ranking member, SPENCER BACHUS, we introduced that legislation. But our Democratic friends prefer bailouts, bailouts over

bankruptcy.

Now they continue to say that the taxpayer won't be called upon to pay for these bailouts. Well, isn't it kind of funny how throughout this conference process, every time they've had an opportunity to choose either the taxpayers or the Wall Street banks, they somehow choose the Wall Street banks? And, in fact, when it came down to the government-sponsored enterprises, they set up a choice--I didn't set up the choice--but they set up a choice of who going forward is going to fund the bailout of

government-sponsored enterprises. Should it be Wall Street banks or should it be the taxpayers? And they decided that it ought to be the taxpayers.

Just yesterday at the 11th hour--actually it was way past the 11th hour--they came up with a new funding mechanism, taking money away from TARP that was supposed to be used for deficit reduction; and, instead, they're going to use it to help fund the bill, most of which the Congressional Budget Office says goes to the Wall Street bailout authority. This is No. 2. The No. 2 incident where they had a choice between choosing the taxpayers or Wall Street banks, they chose Wall Street banks.

A permanent bailout authority costs jobs. They create this new bureau to ban and ration consumer credit--literally to decide whether or not you can have a credit card, small business line of credit, what kind of mortgage you can get on your home. There is functionally a new banks tax that makes derivatives more expensive, less available. All of this is going to harm job creation.

You know, I talk to small businesses in my district, like a gentleman from Jacksonville, Texas: ``I am a one-man operation. With all the legislation coming down the line, I will stay a one-man operation. If lines of credit dry up, I will no longer be able to maintain safe operating equipment and be forced to cease operations.''

Reject the job-killing bill and the permanent bailout authority.

1:57 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. Madam Speaker, I would respond to my friend from Texas that, first of all, losing 780,000 jobs a month, as we were when George Bush left office, that's job killing. That's terrible. One of the things we're trying to do is right that ship. Second, he says that they set up a bankruptcy process for these banks. Well, as Democrats, we said, These failing banks, if they're failing, we're not going to let them linger along like they might in a chapter 11 bankruptcy. We close them. We

liquidate them. That's the purpose of this. No more bailouts.

With that, I yield 2 minutes to my friend from Connecticut (Mr. Larson).

1:58 PM EDT
John B. Larson, D-CT 1st

Mr. LARSON of Connecticut. Madam Speaker, I rise for the purpose of engaging in a colloquy with Chairman Frank to clarify the intent behind section 1076 in this bill. The section amends the Electronic Fund Transfer Act to create a new section 920 regarding interchange fees. Interchange revenues are a major source of funding for the administrative costs of prepaid cards used in connection with health care and employee benefits programs like FSAs, HSAs, HRAs and qualified transportation

accounts.

[Time: 14:00]

These programs are lightly used by both the public and private sector employers and employees and are more expensive to operate because of substantiation than other regulatory requirements. Because of this, I would like to clarify that Congress does not wish to interfere with those arrangements in a way that could lead to higher fees being imposed by administrators to make up for lost revenue, which would directly raise health care costs and hurt consumers. This is clearly not something that

was the intent that we'd like to do. Therefore, I ask Chairman Frank to join me in clarifying that Congress intends that prepaid cards associated with these types of programs should be exempted within the language of section 920(a)(7)(A)Ð(ii)(II).

1:59 PM EDT
Barney Frank, D-MA 4th

Mr. FRANK of Massachusetts. If the gentleman would yield, he's completely correct. The Federal Reserve has the mandate under this, which originated in the Senate, to write those rules. We intend to make sure those rules protect [Page: H5226]

a number of things: smaller financial institutions from being discriminated against since they're exempt from the regulation, State benefit programs, and these.

So the gentleman is absolutely correct, and I can assure him that I expect the Federal Reserve to honor that. And if there is any question about it, I am sure we will be able to make sure that it happens.

2:00 PM EDT
Shelley Moore Capito, R-WV 2nd

Mrs. CAPITO. I would like to thank Mr. Sessions for yielding me the time. I would like to thank our ranking member, Spencer Bachus, for his dedication to this issue. I would also like to thank the chairman of our full Committee of Financial Services for his dedication to this as well.

But, Madam Speaker, as we stand here today, unfortunately, this is a missed opportunity. From the start of the debate, it was apparent there was little or no interest from our Democrat colleagues in working towards a consensus bill on regulatory reform. Now they are using budgetary smoke and mirrors, and I think that it will be apparent to Americans as this bill unfolds.

As my constituents say to us all the time: Work together. Shelve the partisanship. The stakes are too high.

But, unfortunately, the bill before us was drafted without our significant input. We are now faced with a bill that will give us institutionalized government bailouts, limit consumer choices, and raise the cost for businesses, our job creators across this Nation.

My colleagues on the other side of the aisle will be basking in the rhetoric and high praise for cracking down on Wall Street. However, the resolution authority in this bill does little or nothing to address the issue of the moral hazard that has been created by the TARP program. Instead, failed firms will be wound down at taxpayers' expense.

Under this resolution authority, the big will get bigger, and they will push the limits of risk because they will know that the government will be there to pay for their demise. In fact, many of the tools used for TARP are institutionalized in this legislation. My friends can opine on Wall Street reform all they want, but this bill does not achieve that.

Why should the people of West Virginia help pay for poor decisions of Wall Street bankers, or in any State? Well, they shouldn't. But for over a year we have advocated for an enhanced bankruptcy for these large, highly complex financial institutions. This approach would have created a level playing field between Wall Street and Main Street and would have assured all parties know the rules of the game ahead of time.

Furthermore, the taxpayers would not have to worry if their children and grandchildren will have to pick up the tab for the mistakes of the fabulous fabs of the world. Unfortunately, the majority has decided once again to turn a deaf ear to America's cries to end the bailouts.

This bill will fuel the growth of Wall Street, will lead to job loss, and it represents a missed opportunity.

2:03 PM EDT
Barney Frank, D-MA 4th

Mr. FRANK of Massachusetts. If the gentleman would yield, let me say, first, you know, there has been some mockery because this bill has a large number of pages, although our bills are smaller, especially on the page. We do that--by the way, there are also other people who complain sometimes that we've left too much discretion to the regulators. It's a complex bill dealing with a lot of subjects, and we want to make sure we get it right, and we want to make sure it's interpreted correctly.

The point the gentleman makes is absolutely correct. We do not want these overdone. We don't want there to be excessive regulation. And the distinction the gentleman draws is very much in this bill, and we are confident that the regulators will appreciate that distinction, maintain it, and we will be there to make sure that they do.

2:04 PM EDT
Jim Himes, D-CT 4th

Mr. HIMES. Thank you, Mr. Chairman.

My understanding is also that, consistent with the overall intent not to subject commercial firms to financial regulation, section 604 provides that an existing savings and loan holding company with both financial and nonfinancial businesses will cease to be an S&L holding company when it establishes an intermediate holding company under section 626. That company also may have an intermediate holding company under section 167.

Am I right that the intent of this legislation is for these sections to be applied in harmony, so that an organization will have a single intermediate holding company that will be both the regulated S&L holding company and the organization and the holding company for implementing the heightened supervision of systemic financial activities under title I?

2:04 PM EDT
Barney Frank, D-MA 4th

Mr. FRANK of Massachusetts. If the gentleman will yield again, yes, he is exactly right. And just to sum it up, we want regulated some activities and not regulated other activities when you have a hybrid kind of situation, and what the gentleman has described is how you accomplish that.

2:05 PM EDT
Scott Garrett, R-NJ 5th

Mr. GARRETT of New Jersey. Mr. Speaker, like all my colleagues, I believe that financial reform is necessary now. But the legislation that is before us really, which empowers failed bureaucrats through government overreach and unnecessary job killing, is just not the right legislation.

First, you know, one of the major fundamental flaws of this 2,300-page bill is the section that basically empowers government bureaucrats with so-called resolution authority to basically pick winners and losers again, to continue that failed bailout philosophy.

Now, I know the chairman and the proponents of this bill claim that these provisions are meant to add certainty and stability to our financial system. But when you think about it, when you set up an alternative to bankruptcy for failed firms so that there are now two potential tracks for failed firms to go down, that actually introduces more uncertainty, more uncertainty for the financial markets, for the investors, for the counterparties, for our entire economy because of this bill. And that

uncertainty, what does that lead to? It leads to failing to invest and leads to less job creation as well.

Furthermore, this section of the legislation gives an alarming amount of power to government regulators and bureaucrats to basically decide the fate of a firm and its creditors. Under this administration, we've seen this before. We've seen the rule of law trampled when the Federal Government bullied into submission secured creditors in the Chrysler situation. In favor of whom? Well, politically favored unsecured creditors.

And what is this legislation? This would codify the ability of regulators to engage in similar conduct, further eroding confidence in our rule-based economy. And sending investors where, to this country? No. To overseas, scattering them to other opportunities, rather than here in the U.S.

Not only that, but this resolution authority, in codifying a better deal than in bankruptcy for at least some of the politically connected, gives large firms an unfair advantage over their smaller rivals.

This then does what? It increases moral hazard by encouraging investment in firms that basically otherwise just don't deserve it. And this is a part of the problem that led to the demise [Page: H5227]

that we have seen in other areas of our economy, talking about Fannie Mae and Freddie Mac, the GSEs, which, by the way, are never touched in this legislation whatsoever.

Another aspect of the problem with this bill is Big Brother, Big Brother overreach that didn't exist before. This bill creates two new government bureaucracies, including the so-called Office of Financial Research, that will have unprecedented power to track the financial activities of everyone here and everyone in the entire United States. You're taking money out of the ATM, that's tracked. You're trying to set up a new credit card, that will be tracked. Information about any one of your consumer

transactions, that will now be able to be tracked and gathered without anyone's approval, any citizen's approval. And it will be monitored by whom? Basically by unelected and unaccountable bureaucrats here in Washington with few or hardly any constraints whatsoever on how they're going to use the information or when they're going to use the information.

Then there's the section on derivatives, another massive, massive job killer. I joined with Congressman Frank Lucas. We offered an alternative to this bill in the last days that was basically the original House version of the bill. It had broad bipartisan support. Unfortunately, under pressure from Democrat leadership, not a single Democrat supported that House language in the final vote, despite the fact that very same language was originally sponsored by the Democrat Financial Services

and Agriculture Committee chairman.

[Time: 14:10]

The results of all this? Well, the result of that section not being in it means that businesses big and small all over this country which had absolutely nothing to do with this financial crisis will now have a very difficult time to hedge their risks, to guard against future risk, because they will have to pay literally hundreds and hundreds of billions of dollars in additional funds to control risks on a daily basis.

What does that mean for all of us? More job losses. This bill is a job killer. And it will raise prices, too, for every American across the country, whether you are talking about food prices, energy prices, you name it. How many jobs will be lost? In a recent study by Keybridge, they found between 100,000 and 120,000 jobs will be lost because of this job-killing bill.

2:09 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. I have to smile when I listen to my friends talk about job killing, when letting Wall Street run wild, gambling like it was just a big casino, results in 780,0000 jobs a month being lost to the point that during this recession we have lost 8 million jobs. And we've got to put people back to work. We need certainty, we need reasonable regulation. That's the purpose of this bill.

I yield 2 minutes to my friend from Georgia (Mr. Scott).

2:10 PM EDT
David Scott, D-GA 13th

Mr. SCOTT of Georgia. I thank the gentleman for yielding.

Ladies and gentlemen, you would think that the Republicans were somewhere on another planet. Let me correct the situation, if I may.

First of all, this was a problem that occurred under the Bush administration because of policies by the Republicans, who were in charge. It was indeed Paulson, our Secretary of the Treasury, that came to our Financial Services Committee with two pieces of paper and said here is what you need to fix it. Throw all of this money at Wall Street.

Let's give the truth in this matter. It was under Democratic leadership that we said ``no.'' Yes, we have a credit problem, a credit freeze of the credit markets up on Wall Street. And here we were. And I know sometimes the truth hurts, and I feel their pain over there. But I am sick and tired of our Republican friends assuming that they had no responsibility for this, Mr. Speaker. And we've got to set the record straight. It is in the charge of Democrats, under our leadership, that we indeed

are saddled with the responsibility of bringing the confidence of the American people back to our private enterprise system and to keep it free. It is because of what the Democrats are doing that we are saving our free economic system. Under their policies it was heading to straight ruin, causing the worst economic collapse second only to the Depression.

So we are moving here today with this extraordinary bill to do everything possible to make sure that it never happens again, to restore the confidence of the American people. And we are beginning to do that. We are doing it by setting up a consumer protection agency, something we didn't have before. That's the reason this happened. They went to predatory lending, they went to steering people into subprime lending when they could have afforded other loans. There was no protection for them. Democrats

are providing this protection. They were doing it because we had executive compensation pay geared to risky behavior. This is an important bill.

2:12 PM EDT
Pete Sessions, R-TX 32nd

Mr. SESSIONS. Mr. Speaker, I would remind the gentleman who was speaking that we know what happened, and it's called pin-the-tail-on-the-donkey.

Mr. Speaker, I yield 3 minutes to the gentlewoman from Hinsdale, Illinois (Mrs. Biggert), from the Financial Services Committee.

2:13 PM EDT
Judy Biggert, R-IL 13th

Mrs. BIGGERT. I thank the gentleman for yielding.

Mr. Speaker, I rise in opposition to this rule and to ask this body to step back for a moment to do a quick sanity check. What's the purpose of this bill? I thought its purpose was to rein in Wall Street and end the abuses that precipitated the most massive financial meltdown and economic downturn since the Great Depression. Its purpose is to make Wall Street pay for the abuses, not Main Street. I am all for that.

In fact, along with my Republican colleagues I offered the first reform bill, H.R. 3310, back in July, and many amendments designed to rein in Wall Street, end the abuses, but not harm Main Street. Senate Banking Chairman Chris Dodd's first regulatory reform proposal was similar to ours, and offered great promise. Unfortunately, these commonsense and necessary reforms were scrapped in favor of the bill that we consider today.

Instead, we have before us a bill that turns the stated purpose upside down. What do I mean? Well, the end result is that Goldman Sachs supports the bill and the Chamber of Commerce opposes the bill. Goldman's CEO testified, and I quote, ``I am generally supportive. The biggest beneficiary of reform is Wall Street itself.'' Meanwhile, the U.S. Chamber, which represents Main Street American businesses, opposes the bill.

Wall Street supports this bill while Main Street suffers? Where is the logic in that? Main Street didn't engage in shady accounting gimmicks. Main Street didn't make risky derivatives trades. Main Street didn't issue subprime loans. And yet what we have here is a bill that makes Main Street pay the price. And what is that price? Increased taxes on community banks, manufacturers, small businesses, consumers, and American families that will increase the cost of credit. New taxes will decrease the

credit available to those who need it most, small businesses who seek financing to create desperately needed jobs.

How will new taxes rein in Wall Street? This bill expands the size of government, increasing our national debt, making taxpayer bailouts permanent, and distorts our free market by allowing bureaucrats to pick winners and losers. It regulates the wages of every financial employee, from the janitor to the CEO.

We need commonsense financial reform. And that's not what this bill delivers. I urge my colleagues to oppose this rule and the underlying bill.

2:15 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. I would say to my friend from Illinois, with whom I work on lots of things in this arena, I don't know where she is coming from saying there are taxes on small banks. There are FDIC charges so that they have sufficient reserves, but there are no taxes, as she would suggest.

I yield 2 minutes to my friend from North Carolina (Mr. Miller).

2:16 PM EDT
Brad Miller, D-NC 13th

Mr. MILLER of North Carolina. Mr. Speaker, this bill is a huge step forward. Working and middle class families should not again have to worry that financial ruin lurks in the fine print of a contract that their bank's lawyer wrote. Families that qualify for prime mortgages that they can pay will not again get trapped instead in predatory subprime mortgages that they cannot pay. They can use a credit card without worrying about getting [Page: H5228]

gouged. They can

have overdraft protection that is the convenience that their banks say it is, that it should be, not a trap to run up indefensible fees.

If this legislation is properly enforced, we can begin to believe again that our government is on the side of honest Americans trying to make an honest living. This bill is about our values. Our economy depends on our acting in our own self-interest and enjoying the rewards of our efforts, but every major religious faith forbids unrestrained greed.

On the stone tablets that Moses brought down from Mount Sinai there is the commandment, ``Thou shalt not covet anything that is thy neighbor's.'' And according to the First Book of Timothy, ``For the love of money is the root of all evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows.''

When Franklin Roosevelt spoke in his first inaugural address about the practice of unscrupulous moneychangers in the temple, he spoke in language easily recognized by that generation. Roosevelt spoke of restoring ancient truths. ``The measure of the restoration,'' Roosevelt said, ``lies in the extent to which we apply social values more noble than mere monetary profit.''

The financial practices that this legislation seeks to reform have made a few Americans very rich, but by taking advantage of working and middle class families who needed to borrow money and honest investors who wanted to lend it, and by diverting too much of our economy from productive, honest work. We need to restore the faith from which we have erred. This bill is a start.

2:18 PM EDT
Ed Royce, R-CA 40th

Mr. ROYCE. I thank the gentleman for yielding.

I don't know why it should be a surprise to the Left that this financial system collapsed. The reason I say that is because in 1992, the GSE Act passed this Congress, under a Democratic majority passed this Congress. And the GSE Act specifically was an attempt to get every American into a home.

I understand the thought behind it. But the irrationality behind it, in terms of creating these mandates on Fannie Mae and Freddie Mac, the GSEs, mandates that 50 percent of their portfolio of $1.7 trillion be in subprime and Alt-A loans.

[Time: 14:20]

What did they expect would happen? The leverage, the political pull that went into getting the down payments down from 20 percent to 3 percent to zero. And now we have the very result that the Federal Reserve warned us about when they came to Congress in 2003 and 2004 and 2005 and warned us that if we did not take corrective action, if we did not allow the regulators to have the ability to deregulate or to regulate and deleverage these portfolios, that we were going to create systemic risk and

the financial collapse could be a consequence of this.

And blocking repeatedly the efforts in the Senate, which the Democrats did, to address this issue. And then in 2007, finally in 2007 the Democratic majority here brought to the floor a bill which they say attempted to address this issue. But, again, in that legislation it tied the hands of the regulators so that they could not deleverage the portfolios, so that they could not put it into receivership, so that they couldn't regulate for systemic risk.

The other reason they brought the bill to the floor was because it had a $300 billion provision in it for affordable housing. That's why the bill got out of here; but it was opposed by the Treasury, and it was opposed by the Fed.

So the point I want to make is after all of that history, and after watching the collapse--which we were warned about by the regulators--and albeit, with good intentions because I know the thought was everybody would be able to have a house if you could get down to zero down payment loans and if you could force the GSEs to buy that junk that was sold by Countrywide, who do you think created the market? It was 70 percent of the market. It was because there was an intention here to circumvent the

rules of economics.

And now in this legislation, what is not addressed? This very duopoly Fannie Mae and Freddie Mac. When you say we address the problems, no we don't. We compound the problems in this legislation.

2:22 PM EDT
Ed Royce, R-CA 40th

Mr. ROYCE. Now, what we do with this legislation is we make the largest institutions too big to fail, and we do so by putting in a provision that is going to allow them to borrow at a lower cost than their smaller competitors, who I guess we would say are too small to save. Right. They are going to borrow at a hundred basis points less because of the government backstop you're putting in place and because you're not allowing them to go through a regular bankruptcy process. We would like to see

enhanced bankruptcy on the Republican side. We'd like to see firms actually fail.

Instead, we're going to have a process here where creditors are going to get a hundred cents on the dollar, potentially. They are going to loan to big firms; these big firms are going to become overleveraged. You did the same thing here that you did with the government-sponsored enterprises, Fannie and Freddie, that then forced their competition out of the market. And as a consequence of that, they became duopolies and then failed.

So this is what we're trying to get across to our friends on the other side of the aisle. This is why we oppose your approach. We've seen where it's headed from before.

2:23 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. Mr. Speaker, Mr. Royce mentions 2003, 2004, 2005 should have changed the GSEs in Fannie Mae and Freddie Mac. Well, the Republicans controlled the House, the Republicans controlled the Senate, the Republicans controlled the White House, and they didn't do it.

In fact, his former chairman on financial services, Republican Mr. Oxley, says the critics forgot that the House stepped up on reforming bills, but he fumes about the criticism that people are giving about Fannie Mae and Freddie Mac. He says all the--this is from the Financial Times, September 9, 2008: All of the handwringing and bedwetting is going on without remembering how the House stepped up on this. He said: What did we get from the White House? We got the one-finger salute. Very graphic

quotation from Mr. Oxley, Republican chairman of the House Financial Services Committee saying that it was the White House that stopped the changes that needed to be stopped, and it's the billions of dollars from those mortgages from 2003, 2004, 2005, 2006 under Republican leadership that are weighing down Fannie Mae and Freddie Mac that under the Democrats we offered conservatorship and that's what they're in now, like a bankruptcy.

With that, I yield 2 minutes to my friend from Minnesota (Mr. Ellison).

2:24 PM EDT
Ed Perlmutter, D-CO 7th

Mr. PERLMUTTER. Mr. Speaker, Mr. Royce mentions 2003, 2004, 2005 should have changed the GSEs in Fannie Mae and Freddie Mac. Well, the Republicans controlled the House, the Republicans controlled the Senate, the Republicans controlled the White House, and they didn't do it.

In fact, his former chairman on financial services, Republican Mr. Oxley, says the critics forgot that the House stepped up on reforming bills, but he fumes about the criticism that people are giving about Fannie Mae and Freddie Mac. He says all the--this is from the Financial Times, September 9, 2008: All of the handwringing and bedwetting is going on without remembering how the House stepped up on this. He said: What did we get from the White House? We got the one-finger salute. Very graphic

quotation from Mr. Oxley, Republican chairman of the House Financial Services Committee saying that it was the White House that stopped the changes that needed to be stopped, and it's the billions of dollars from those mortgages from 2003, 2004, 2005, 2006 under Republican leadership that are weighing down Fannie Mae and Freddie Mac that under the Democrats we offered conservatorship and that's what they're in now, like a bankruptcy.

With that, I yield 2 minutes to my friend from Minnesota (Mr. Ellison).

2:24 PM EDT
Keith Ellison, D-MN 5th

Mr. ELLISON. Mr. Speaker, let me just correct one very, very serious flaw and that is to somehow blame the effort to house Americans for this crisis. This crisis, this financial crisis, has to do with a failure to regulate, a failure to give consumer protection to people who are getting mortgages that they couldn't pay for on tricky and unsound terms, because we are now going to have a consumer protection bureau designed to protect those very same consumers. We are bringing stability to the market.

We are bringing people a chance to have a home that they actually can pay for on terms that they actually will understand.

This consumer financial protection bill is going to be something that will help people keep the money that they earn and to make sound financial investments and purchases that will allow them to prosper and grow unlike the ones we saw in the past where Republican leadership let the laissez-faire economy move right on along without consumer protection, without oversight, which landed us in this serious, serious crisis.

The fact is, Mr. Speaker, the financial crisis that we're in is a result of a [Page: H5229]

lack of oversight, a lack of regulation, a lack of clear rules; and this particular piece of legislation will bring real clarity. It will also help banks. It will help small community banks because they will be able to compete on equal footing. Their competitors will now be regulated, which they were not in the past; and small banks will be able to say that the products that

they offer will be able to be offered to the consumer on a basis similar to those unregulated financial institutions which now will be regulated.

So, Mr. Speaker, I think it is a good time to say that this bill is an excellent step forward. It will help stop the nickel and diming of Americans. It will help stop the targeting of people for financial mistreatment, and it will bring greater stability to our economy.

2:27 PM EDT
Don Manzullo, R-IL 16th

Mr. MANZULLO. Mr. Speaker, we on the Financial Services Committee have spent nearly 2 years holding hearings to determine the appropriate course of action for financial reform.

In September, the committee began marking up legislation to try to address failures in the financial market and plug the holes. The problem is that the two big culprits here, Fannie Mae and Freddie Mac, now taken over by the government, could cost the American taxpayers $1 trillion. Those two entities simply are not even--nothing happens to them in this new bill, the guys that caused the problem.

Maybe you could take this 2,000-page bill and gel it into one sentence: you can't buy a home unless you can afford it. That's what caused the problem in the first place.

No credit standards, so-called ``liar loans'' where people were allowed to buy homes when others sat at the closing table knowing full well the new buyers couldn't even make the first payment. So it took the Fed I think 2 years to come up with a rule that says, oh, by the way, if you buy a house, you have to have written proof of your earnings.

I mean, why did we need 2,000 pages of a bill--and none of it's addressed to the GSEs--simply saying Freddie Mac and Fannie Mae won't take the assignment of the mortgage unless the mortgage is sound. That won't solve the problem. We wouldn't have had the complete collapse of the system that we have today. But instead we just created an agency, the Consumer Financial Protection Bureau. What are these guys going to do besides adding hundreds of more bureaucrats, maybe build a new building somewhere,

and they're going to impose regulations in nearly every sector of the economy.

[Time: 14:30]

What are they going to say?

All they have to say is, ``If you can't afford to buy a house, you can't have it.'' That should be the extent of the regulations. Yet what do we have now? Instead of one sentence, we have 2,000 pages.

2:29 PM EDT
Chris Van Hollen, D-MD 8th

Mr. VAN HOLLEN. Mr. Speaker, the purpose of the Wall Street accountability bill is very clear: Never again should the American taxpayer be asked to foot the bill for bad bets made on Wall Street. Never again should millions of Americans have to lose their jobs because of reckless conduct on Wall Street. Never again will we allow the American economy to be held hostage to bad decisions on Wall Street and in the financial sector.

Unfortunately, Mr. Speaker, our colleagues on the other side of the aisle haven't gotten that message. Having stood in this Chamber and having voted to help rescue Wall Street and the financial sector, they are not there for Main Street today. I think some headlines are instructive.

The Wall Street Journal, February 4, 2010:

``GOP chases Wall Street Donors.''

``In discussions with Wall Street executives, Republicans are striving to make the case that they are the banks' best hope of preventing President Barack Obama and congressional Democrats from cracking down on Wall Street.''

Roll Call, December 8, 2009:

``House GOP meets with 100 Lobbyists to plot to kill Wall Street Reform.''

``In a call to arms, House Republican leaders met with more than 100 lobbyists at the Capitol Visitors Center on Tuesday afternoon to try to fight back against financial regulatory overhaul legislation.''

That is the story of this debate, and the choice is clear: Are we going to be on the side of the big banks, which held the American economy hostage, which resulted in the loss of millions of jobs, and which left the taxpayers on the hook, or are we going to stay on the side of the consumers, taxpayers, American workers, and small businesses? The choice is very clear.

Back in December, every one of our Republican colleagues voted ``no'' on Wall Street accountability. Let's hope, this time, they stand on the side of the American taxpayer and of the American consumer and make the right choice for the American people.

2:31 PM EDT
Pete Sessions, R-TX 32nd

Mr. SESSIONS. Mr. Speaker, I find it very interesting that the same people who are down here who are arguing for us to give them the responsibility and authority and who are espousing how balanced their bill is are the same people who are bankrupting this country. They don't even apply their own logic and common sense to what they pass in this House. They talk about all of this balance and responsibility and about how they are worried about the middle class. Yet they are bankrupting this country.

Yet they are causing the largest unemployment that we have had in the modern era. They are not even talking about what they have done to create that circumstance, and they are trying to point the finger at somebody else. I think that that is irresponsibility.

Mr. Speaker, at this time I yield 2 minutes to the gentleman from Clinton Township, New Jersey (Mr. Lance), a member of the committee.

2:32 PM EDT
Leonard Lance, R-NJ 7th

Mr. LANCE. My thanks to Mr. Sessions; to our ranking member, Mr. Bachus; as well as to the chairman and to the gentleman from Colorado.

Mr. Speaker, I rise to express my opposition to the rule for the financial bill that gives Wall Street firms the potential of permanent bailouts, that institutionalizes ``too big to fail,'' and that will ultimately constrict lending to consumers and small businesses at the worst possible time for our economy.

The underlying measure does not fully audit the Fed, and it does nothing to rein in housing giants Fannie Mae and Freddie Mac, which have already cost U.S. taxpayers $145 billion and counting.

The Troubled Asset Relief Program funds, by the original law, were supposed to be used to reduce the deficit, not to be used as a funding source for new spending, and the increase in the premium reserve ratio at the FDIC should not be used for anything other than protecting depositors in bank failures. Yet the Democratic majority has chosen the fiscal path of more spending and more borrowing--this at a time when the Federal debt is $13 trillion and rising rapidly.

The American people deserve a better plan that puts an end to bailouts, that audits the Fed, that reins in Fannie Mae and Freddie Mac, and that takes the government out of the business of picking winners and losers. This bill fails on all of these accounts. I oppose the rule and the underlying bill.

2:34 PM EDT
Phil Hare, D-IL 17th

Mr. HARE. Mr. Speaker, for too long the irresponsible actions of big banks have put American families at risk. Today, with the passage of this financial reform legislation, we will finally begin to protect consumers on Main Street from the greed on Wall Street.

Predatory lending, risky schemes, and exploiting loopholes were just some of the tricks used by Wall Street fat cats to send our economy spiraling to the brink of a depression, but under this bill, we are ending these practices, and we are shining new light on products and transactions that threaten the stability of the financial system.

This bill is a landmark achievement in consumer protection by establishing a Consumer Financial Protection Agency, dedicated to ensuring that bank loans, mortgages, and credit cards are fair, affordable, understandable, and, most importantly, transparent.

This bill is good for small business. It is good for consumers, and it is good [Page: H5230]

for the financial security of our great Nation. It will also ensure that our financial sector will continue to remain an engine of economic growth, which is one of the reasons the Community Bankers Association of Illinois supports this legislation.

I want to thank Chairman Frank and all of the members of the Democratic leadership for having the courage to do what is right and for standing up for American families.

Today, we have the opportunity to say enough is enough, to rein in Wall Street, and to protect our constituents. I ask my colleagues on both sides of the aisle to join me in supporting this critical piece of legislation.

2:36 PM EDT
Patrick McHenry, R-NC 10th

Mr. McHENRY. I thank my colleague from Texas for yielding.

Mr. Speaker, I encourage my colleagues to vote ``no'' on this closed rule and to vote ``no'' on the conference report of this so-called ``financial regulatory reform bill.'' I say ``so-called'' because this is not much in the way of reform. It is change. It is manipulation, and it is going to be harmful to the American people.

My district is still mired with high unemployment. We've got over 13 percent unemployment in western North Carolina. The people across this Nation have about 10 percent unemployment nationally. People are hurting. Small businesses in my district are worried about access to credit. Families are worried about being able to keep their credit cards, their checking accounts, and the financial products that they know and like.

Unfortunately, this bill, this legislation, restricts credit, and it makes credit less available and tighter going forward. It makes it harder for the small businesses which are struggling to meet payroll--much less to create jobs--to make ends meet.

Now, the new taxpayer-funded bureaucracy that this legislation creates will intervene in the financial affairs of every single American and not for the better. The results will be fewer loans for people to buy cars, to purchase homes, to go to college, or to start small businesses. To make matters worse--and the kicker with this bill--is that it won't prevent the next crisis. It doesn't even address the root causes of the last crisis.

Certainly, we are in favor of making sure the last crisis we faced doesn't ever happen again. I think we agree on that, Republicans and Democrats. The fact is this bill doesn't address the root causes of the last crisis. So to call this ``reform'' is a sham and a fraud, and I encourage my colleagues to vote against it.

2:38 PM EDT
Mike McMahon, D-NY 13th

Mr. McMAHON. I thank the gentleman for yielding.

Mr. Speaker, I rise today in full support of the bill and this rule.

I commend Chairman Frank, Chairman Peterson, and all of the Members and their staffs who have worked so hard.

This legislation, Mr. Speaker, addresses many of the problems at the heart of the financial crisis while allowing us to build an even stronger regulatory foundation for future economic growth and stability in our financial markets, which we need, undoubtedly, to create jobs in the American economy.

Since my first days in Congress, I have called for smart, thoughtful, new regulations for our shared goals of reform without unnecessarily burdening our economy or forcing our financial industries overseas. After a year and a half of debate, discussion--and although not perfect--I think we have struck the right balance here, and I am proud to support this bill. It is good for America. It is good for New York City. It is good for the people of Staten Island and Brooklyn, who sent me here to represent

them.

In particular, I applaud the effort to bring greater transparency, accountability, and oversight to our derivatives markets. This bill will make sure that our regulators in the private sector understand that outstanding swap exposures for individual companies will never be allowed again to bring about a situation like what happened with AIG. This legislation also recognizes the important role that derivatives play in actually reducing systemic risk for our end user companies and in increasing

the flow of credit throughout our economy.

[Time: 14:40]

Whether it is an airplane or farm machinery manufacturer hedging against currency risks, a commercial real estate company or life insurance annuity hedging against interest rate fluctuation, or an energy provider trying to hedge the price of oil and gas, derivatives are vital tools to keep consumer prices low and to help manage company budgets. These end-user companies pose little or no systemic risk to our economy, and this bill protects them from unnecessary and burdensome margin and clearing

requirements.

Again, I thank Chairman Frank and his staff for allowing me to be part of this process, and I thank the gentleman from Colorado for yielding me this time.

2:41 PM EDT
Pete Sessions, R-TX 32nd

Mr. SESSIONS. Mr. Speaker, as I said earlier, it is important to provide consumer safety and security in the marketplace, but our constituents are also concerned about much, much more. They are concerned about jobs, they are concerned about the economy, and they are concerned about the tremendous debt this Nation has taken on.

Week after week we come to the House floor to debate bills and to talk about the agenda that the Democratic majority wants to have on the floor, and it would be true to say that Republicans oppose that agenda, because it is about taxing, it is about spending, it is about more debt, it is about bigger government, and it is about the diminishment of free enterprise system jobs. It is about the things that the American people have said they do not have confidence in this body solving.

Whether it is cap-and-trade, health care, or government takeover of the financial sector, my friends in the majority are ready every single week to stick it to the free enterprise system. My friends the Democrats seem more interested in accomplishing their political agenda than trying to help the American people.

Once again, today, we have a job loss bill on the floor. That is really what we should call this--more big government, fewer private sector jobs, $18 billion in fees that will have to be paid by the banks that will be passed on to consumers, just on and on and on.

Every Member of this body has a chance to say no to more spending, more big government, more rules and regulations, and somehow to show the American people that they can make tough choices and cut spending.

I encourage a ``no'' vote on the rule and a ``no'' vote on the underlying legislation. And I appreciate the gentleman from Colorado and his engagement with me today.

I yield back the balance of my time.