The Economy

Floor Speech

THE ECONOMY -- (Senate - September 18, 2008)

Mr. CASEY. Mr. President, I know it is getting late in the evening, and we are at the end of a long day for a lot of people in our country. I want to talk about not just the economic crisis our families and our country are living through right now, but also what we have seen over the last couple of years, and certainly in the last 7 to almost 8 years now.

I think it is instructive to look at where we were 7 years ago and where we are today. By virtually every indicator, it is a much tougher world for a lot of families, especially working families and poor families. On the one hand, you have an increase in the number of Americans living in poverty; by one estimate, more than 5.5 million more people. So now that number goes above 38 million Americans.

Health care, there are so many different ways to look at it. I know in my home State of Pennsylvania, since 2000, family premiums--the cost of health care for a family--are up by almost 50 percent, between 45 and 50 percent. If you look at it in another way, in terms of overall health care, we have seen these national numbers of 47 million Americans uninsured right now in the country. Some say it dropped to 45 million. Whatever that number is--whether it is 45 million or 47 million--it is way too high.

I think the current administration has done nothing to address that--no leadership by the President, no prioritization of that issue as a compelling national issue. There are 9 million American children with no health insurance, and the President vetoed the expansion of the Children's Health Insurance Program, which, as the Presiding Officer knows, got almost 70 votes in this Chamber more than once.

There are so many different ways to look at these numbers. In the last year, over 605,000 Americans lost their jobs. The mortgage crisis, the foreclosure crisis is in the lives of so many families. I live in a State which, if you compare it to other States, relatively, has not had as much of a problem as some States such as California or Nevada or others.

But in the month of August of this year--August of 2008--versus August of 2007, if you compare it month to month for those 2 years--August 2007 to August 2008--the foreclosure rate in Pennsylvania is up some 60 percent, much higher than the national rate. So even in a State which has not felt the same effects, relatively, as these other States, now the foreclosure crisis is closing in on places and on families in Pennsylvania. In so many indicators, we can see it.

We can see it obviously on Wall Street in the headlines. I do not need to repeat what we have seen in the newspaper. But I think when we look at our own communities, we can see the same is true. I am not going to read all of this document. I am going to have it printed in the Record. I am going to read the headline and ask that the document be made a part of the Record: ``Recent major Pennsylvania plant closings and/or layoffs.'' I ask unanimous consent to have this document printed in the Record.

There being no objection, the material was ordered to be printed in the Record, as follows:

Recent Major Pennsylvania Plant Closings and/or Layoffs

NORTHEAST

Luzerne County, Wilkes-Barre: Geisinger Health System in South Wilkes-Barre is laying off 451 employees, primarily those who work in inpatient services, by September 2008.

Luzerne County, Mountaintop: Fairchild Semiconductor International is laying off 331 employees, this was announced 7/24/2008.

LEHIGH VALLEY

Lehigh County, Allentown: Mack Trucks Inc. is moving 800+ jobs from Allentown to North Carolina when it consolidates its headquarters by the end of 2009. This will be partially offset when Mack moves 200+ jobs from Virginia into its Macungie manufacturing facility by the end of 2008. This was announced on 8/14/2008.

SOUTHEAST

Montgomery County, King of Prussia: Idearc Media Corporation laid off some 120 CWA members at the end of 2007 from its facility in King of Prussia. The workers there produced advertisements for the yellow-pages phone book. Idearc moved this production to India and laid off half of the 240 employed at this facility.

Bucks County, Warrington: MeadWestvaco Consumer Packaging Group LLC is laying off 145 when they close their packaging manufacturing plant in Warrington, which was announced on 5/15/2008.

Northumberland County, Elysburg: Paper Magic Group Inc. is laying off 312 employees when it closes its Elysburg facility. This was announced on 1/4/2008.

Berks County, Reading: Hershey Inc. is laying off 274 when it closes its Reading facility, announced on 3/14/2008.

Montgomery County, Fort Washington: Chase Home Lending is laying off 266 employees, announced on 5/29/2008.

CENTRAL AND SOUTHCENTRAL

York County, York: Harley Davidson is laying off 300 as part of a nationwide layoff of 730. The layoffs were scheduled to begin this month.

Fulton County, McConnellsburg: JLG Industries is laying off 375 employees by September of this year. They produce heavy aerial lifts and work platforms. It was announced in July that they will be laying off 250 employees in McConnellsburg, 100 at Shippensburg, and 25 at Bedford.

Centre County, Bellefonte: Bolton Metal Products is laying off 223 when it closes its Bellefonte facility due to increased foreign competition. This was announced on 2/4/2008. A letter under your signature was sent to the Department of Labor in support of the workers when they were denied TAA benefits. The workers then won the benefits on their appeal.

York County, Red Lion: Yorktowne Inc. is laying off 349 employees when it closes its plant #6 in Red Lion. This was announced on 1/23/2008.

Lancaster County, East Petersburg: Sterling Financial is laying off 325 employees in its East Petersburg facility, which was announced on 4/15/2008.

SOUTHWEST

Allegheny County, Bethel Park: Washington Mutual is laying off 247 when it closes its facility in Bethel Park. This was announced on 4/9/2008.

NORTHWEST

Erie County, Corry: Erie Plastics is laying off 189 employees, announced on 2/15/2008.

Mr. CASEY. This is a brief summary of plant closings that involve hundreds of jobs in particular communities: Luzerne County--the county right next to my home county--451 employees at Geisinger Health System losing their jobs; 331 employees at the Fairchild Semiconductor International plant being laid off. That was announced in July. In Lehigh Valley, at Mack Trucks: more than 800 jobs being lost in our State and moving to another State. In Montgomery County--a very prosperous county in southeastern Pennsylvania--a corporation there laying off 120 employees. In Bucks County, a company there laying off 145 employees. In Berks County, Hershey Incorporated laying off 274 employees. That is just in the southeast.

Then you go to central Pennsylvania. In York County, a plant there--Harley Davidson, in fact--laying off 300 employees; a plant in Fulton County--a very small county in Pennsylvania--laying off 375 employees.

It goes on from there: hundreds and hundreds of people losing their jobs, just in some communities in Pennsylvania, just this year. So that is exhibit A in terms of job loss in Pennsylvania.

But also I think it gets back to this whole question of about what the Congress can do. We look at what has been happening on Wall Street--the loss of wealth, the loss of confidence--but what is happening on Wall Street mirrors what has happened in the lives of a lot of families. When you lose your house--and because of foreclosure, you are forced out of your home--you lose not only your home, the place you live, the place your family lives--a sense of your own, and the reality, I should say, of your own net worth--but as much as all that, you lose your dignity. So many families have lost that dignity. I think as much as we in the Congress, for the next couple of weeks and months, even leading into a new administration, will debate policies that pertain to financial markets--what about credit, what about capital, all these terms, ``liquidity,'' the things we are hearing a lot about as they pertain to Wall Street--and regulation is going to be an important part of what we do--but as we debate all of those issues, I think we have to get back to the fundamentals about why we are living through this nightmare.

Part of it is the failure of this administration to do something in an aggressive way about regulation. Part of it is greed. But what resulted from that greed and from that inability to regulate markets and to oversee mortgages in an appropriate way is the fact that we have foreclosures. So if the Congress wants to respond to this in a positive way, to get something done, we have to do something about foreclosures, to bring that number down, to keep people in their homes and thereby to strengthen neighborhoods and our economy overall. If we keep neighborhoods strong, keep people in their homes, it will affect the whole world's financial markets and certainly our economy.

So what do we do? Well, I think what we can do--there will be a lot of proposals about how to get there--but just broadly--and I will conclude with these thoughts--to get there broadly what we have to do is to say: If in the July legislation--which was not everything that all of us wanted; I know the Presiding Officer and I probably wanted a lot more in that bill than we got, but what we did in that bill was to create an opportunity for 400,000 people to stay in their homes by getting the borrower and the lender in the same room, so to speak, to work out a modification, to work out some arrangement to keep that family in that home. What we have to do is take that 400,000 and expand it exponentially to at least a million and, beyond that, if possible, to do everything possible to keep those families in their homes.

If there is nothing else the Congress does for the next couple of months but focusing on the prevention of foreclosures, we will have contributed significantly to preventing some of the trauma we see on Wall Street and, as we have been hearing over and over again, on the Main Streets of America in the lives of our families.

There are a lot of ways to do that. One of those strategies is making sure that the prevention of predatory lending is a higher priority. But I think focusing on individual mortgages and the relationship between an individual lender and that homeowner is going to be critical to this. So we have to expand what we have already done and do more on keeping people in their homes.

We will talk more about it. But do you know what. All the answers to these questions do not simply reside in what we talk about in the Senate or what happens in the House or here in Washington. A lot of good ideas are coming from our communities.

I point to one example. In Philadelphia--one of the places in Pennsylvania where the foreclosure rate has been far too high, even though other places have escaped it so far--in the city of Philadelphia, the court system, Judge Darnell Jones, and others, the mayor of the city, Michael Nutter, a very effective and capable mayor, came together with activists and people who understand how to keep people in their homes and said: Let's develop a program at the local level, and let's try to implement it.

They developed the Residential Mortgage Foreclosure Diversion Pilot Program. I have spoken about this before. But it is a kind of example we should expand upon and use as an example to keep people in their homes. In a word or two, it is an early intervention program. Instead of letting these mortgages go so far out of control where someone cannot stay in their home, they intervene earlier. The courts are able to facilitate loan workouts and other solutions to keep homeowners and their families in their homes.

It is an effort, as I said before, by the city and the mayor's office, Mayor Nutter, of being able to bring together housing advocates, volunteer attorneys, lenders, and servicers who all share the same goal of keeping people in their homes.

Now, the interests of these groups are divergent, but they have set aside those differences, and they realize that stemming the tide of foreclosure helps everyone. It obviously helps the homeowner and the family and the community. But it also helps lenders and, in a very substantial way, our economy.

So that is one example. We will talk more about it later in detail. But we need to enact policies that make sure those kinds of good examples coming from our communities become part of national policy.

If we do that--if we are able to keep more and more, instead of 400,000 people staying in their homes, we make that 1 million, or even higher than that; if we do that, I think we can begin to stabilize the root cause of a lot of our problems.

In addition to that, we have to do more in regulation. We have to do much more in holding government agencies accountable that should have been the cop on the beat, so to speak, when it comes to what happens to lending practices and to mortgage practices.

So there is much to do, but I think the best thing we can do is focus on the root cause of this, which is foreclosures and the prevention of those foreclosures through counseling, through good programs, and through bringing people together at a time of real stress in the life of families. I think we can do that. I think we have done that in the past. I think it is a bipartisan wish. What we are going to need here is leadership beyond the finger-pointing that we often see here in Washington.

So if we bring that spirit to this priority of stabilizing our economy, I think we can move forward and have a much stronger economy. If we choose not to and choose to focus on issues that will divide us when it comes to foreclosures, I think we are going to be off on the wrong track.

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