2:37 PM EDT
Gresham Barrett, R-SC 3rd

Mr. BARRETT of South Carolina. Mr. Speaker, I rise to oppose this bill, which I think is unhelpful for the housing market and unfair to the American taxpayer.

Like many of my colleagues, I'm concerned that this program will only distort housing prices, causing problems in the future by forcing the taxpayer to foot the bill.

I have no doubt that some of the lending practices in the beginning of the decade, Mr. Speaker, were irresponsible, and that the government should take certain steps to help the market right itself and to prevent these problems from recurring in the future. At the same time, I'm a firm believer in the power of the free market, and I believe that the housing market fundamentally reflects the laws of supply and demand.

I'm always wary of government intervention in the markets and concerned about unintended consequences. I fear that in our rush to help, we are overlooking the basic realities about today's housing market and about the cost of government spending.

I think we can all agree that government programs cost money, and this program has the potential to cost a tremendous amount of money. And that money comes from the taxpayer, Mr. Speaker. Because, in reality, like the laws of supply and demand, decisions have consequences, and money has to come from somewhere. It's not fair to ask my constituents from South Carolina, who work hard and spend wisely and pay, in my opinion, too much tax money, to carry the burden for others' financial mistakes.

While I believe that people in need deserve our understanding and our help, I trust in the ability of the free market to correct itself. And I think Americans know how best to spend their money and should be trusted to make their own financial decisions. I also think that lenders have a responsibility to live with the consequences of investments that did not quite turn out as planned.

Mr. Speaker, I offered an amendment in the Financial Services Committee that is representative of my concerns. The amendment was not adopted, and it was very simple. It was to strike the section of the bill that prohibits FHA from denying borrowers entry into the new FHA program solely on the basis of the mortgagor's current FICO or other credit scores, or any delinquency or default by the mortgagor. In South Carolina talk, Mr. Speaker, this amendment would have given the FHA the opportunity

to use individual pieces of information on their own that reveal the risk of borrowers defaulting. In offering the amendment, I wanted to allow the FHA to protect the American taxpayer by giving them every tool available.

I understand the motivations of this section of the bill to try to include as many people as possible in the program meant to help them. And I understand it would be nice if we could help all of these borrowers, but some may have very bad credit scores that reflect irresponsible borrowing behavior. It's not fair to the American taxpayer to insure the loans of the riskiest borrowers who may not be able to pay their mortgages no matter what the terms of the loan.

Without a doubt, it's never easy to hear the stories of hardworking individuals and families losing their homes, but I do not believe that more government intervention is the solution to our problems. And we should not allow the American taxpayers to become the insurance policy for the financial decisions that did not turn out as planned or for temporary market downturns. We should not punish those hardworking and responsible American taxpayers for the mistakes of a few. For these reasons, and

others, I oppose this legislation and ask my colleagues to do the same.