PAUL WELLSTONE MENTAL HEALTH AND ADDICTION EQUITY ACT OF 2008 -- (Senate - October 01, 2008)
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Mr. DOMENICI. Madam President, I want to quickly thank a few people. It is obvious, the people who have worked extra hard and done such a marvelous job. But I have been involved many times in negotiations such as this. In fact, the last time we did one of these, I was chairman of the Budget Committee, and we had a savings and loan bailout. I remember it well. It is worth mentioning for a moment because, as Senator Dodd will remember, just as our Secretary of the Treasury is telling us, if this works right, we could, in fact, make money instead of losing money. So whenever we talk about $700 billion as if it were being lost or given to somebody and they could run away with it, when we did the savings and loan bailout, we were told when you pay for all these assets and take them in, they may bring you as much money as you spent. And lo and behold, it took a few years, but the Treasury made money on that last bailout we had to put together. I predict that the amount of money that will be lost on this one will be much less than the 700. As a matter of fact, if it worked right, the taxpayer could get reimbursed and, in fact, some money could get paid down on the national debt. I start with that.
Having said that, I thank those who spent extra amounts of time, energy, and did a great job, starting with the chairman of the committee, Senator Dodd. I don't think we ought to be partisan. I heard some Democrats talk about only Democrats that had been active in this. It wasn't you, Senator Dodd. But you know that on your side you were busy. On our side we had a rather marvelous negotiator named Judd Gregg. I believe we want to thank him unequivocally for his work. He surely has done a yeoman job with Republican Senators, explaining what you all were doing. From that, there are numbers of other people, and I say thanks to all. You have done a terrific job.
Our job here in the next few hours is to pass a bill and send it to the House and challenge them to vote for it. It is past time, but it is absolutely obvious that we must put confidence back into the credit system of the United States. We must put confidence back into the credit system of the United States. That means this rather fantastic credit system, which has gone awry without any doubt, because it has been manipulated, abused, but nonetheless it is still the greatest delivery system that the world has ever seen in terms of delivering money where money has to be, where money is needed, is now rocking. It is in the tenth round of a heavyweight bout, and it is about to be knocked out. We have to do something to make sure that doesn't happen.
I am very pleased that the Secretary of the Treasury, in spite of whatever faults have been enumerated on the floor--and he claims some faults himself. He talks about not being an eloquent speaker. I imagine he hears Senator Dodd or he hears some other Senator, and he goes back and does his work, and he wonders why the good Lord made him so that he can't talk as well as them. But he knows a lot. For those who don't think he should have been in this job, they are mistaken. He has come up with solutions to this point.
He has told us how to solve the problem of the credit system being filled with toxic assets. Toxic assets have been explained enough here for me not to have to do it again, but essentially, for the most part, they are mortgaged-backed securities that are no good. They were no good from the beginning; ``no good'' meaning the person who bought the house and gave the mortgage could not have made the payments from the very beginning. They were given an opportunity to buy and sign the promissory notes, with people having full knowledge that they weren't earning enough. They were a credit risk, and they should not have had these mortgages.
There were so many of them issued over the past 10 to 12 years that they permeate the system. When they get there in sufficient numbers, they clog the system, much like cars on a freeway speeding at 65 miles an hour and having a crash. It is across all six lanes. All the cars are stopped until you move the broken-down, crumbled-up cars. You move them off, and then things run again. So we must move them off and let the part of the American financial system that is great, let the liquidity run its course so it is available where money should be available under the American free enterprise, capitalist system.
We are hopeful that Secretary Paulson, in analyzing this, analyzing the way to get that wreckage out of the way, in creating this $700 billion entity that could go out there and use that money to buy up this salvage, hold it in the name of the people, can then, believe it or not, sell it so that they might make money off of it. That is perhaps why Secretary Paulson came to us with four pieces of paper saying: This is what we ought to do. He clearly understood that while it is complicated, it is very simple. While it takes many pages because of the way we do legislation, four pages explains it in his language, as he would need the language to do his job.
In any event, the current situation in the United States has created a problem where the financial and credit markets are blocked up. No matter
how you say it, either say toxic assets, with salvage from a car wreck, call it what you may, you must get the toxic assets out of the way. That is what this fund is going to do.
I, for one, had a difficult time at the beginning understanding why we should do this. I actually was kind of upset and mad at the same time that we were in this situation at this particular time in our economic history, when such modernism has been imposed on the financial system in great gobs. It is terrifically efficient and modern, filled with all kinds of technological breakthroughs that make the system work. Here we were, nonetheless, loading a system with promissory notes and mortgages that from the very beginning were not going to make it, thousands upon thousands of them being packaged up, with a bow put on them, making them look like securities that were valuable and shipping them out and getting them through the market.
What we are being asked for here tonight is to vote yea for a bill that contains the proposed rescue mission that Secretary Paulson, on behalf of the President, has put together and submitted to us. We made it better in that we made sure it has oversight. We made sure that the other things our people were complaining about were taken care of. We have taken care of those, and it is a better bill in that regard.
Then we were shocked the other night when the House voted no on the bill. It has come back to the Senate, and here our people have thought it through. I hope House leaders have paid attention and listened. As I look down at my friend Senator Dodd, I say I am hopeful and certainly almost positive that he and others have talked to the leadership on the House side about what we are going to do tonight and what we hope they will do, when they get the results of our vote.
I think I am safe in predicting the enthusiasm around here is to vote this out. It will pass overwhelmingly, in my opinion. Nobody is happy. Nonetheless, we are going to get it done. This is one of the most difficult situations to explain to the American people that I have ever been involved in.
This afternoon, I was on a little TV show, and the announcer said to me: Senator Domenici, I want to ask you a question that I was asked today.
I said: You mean this day, today?
Yes, an hour ago.
What was the question, I said.
He said: I have $250,000 and I would rather lose it than to see our banking system socialized. Why aren't you saying that? She said to the announcer, why aren't you condemning the socialization of our banking system?
Of course, it was my turn to answer. I said: My oh my, it is hard to explain to people. First of all, the Secretary is only given 2 years to accomplish this entire job, 2 years. In 2 years, I think we could hardly socialize a system as big as the United States banking and finance system. You are in and out and hope it works. So I believe many people in this country are paying attention and trying to understand it, but we are all having difficulty communicating.
I hope when we are finished tonight, we will be able to explain it better to our people. And before we are finished, some of the fear and trepidation that Members of the House have about voting for this can be dissuaded and we leave the scene. And we can vote with confidence for the country, for the right thing, and make sure that our finance system is given a chance to come out from under this absolutely perilous load that has been thrust upon it.
There will be plenty of time after that to assess blame. I would caution that if you read anything about it, either side ought to be careful about laying blame on the other side. I look to the Democrats and say: Be careful as you try to blame President Bush and Republicans exclusively for this. I say to Republicans the same thing.