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Public Statements

The Great Scam And Fraud Of The Century

By:
Date:
Location: Washington, DC

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I thank my colleague for yielding.

Mr. Speaker, I know that tonight many Americans are going to put their head on the pillow and have a very restless and maybe sleepless night again because tomorrow's going to be another day of trudging around with a resume that no one seems to want. Maybe they're concerned that tomorrow will be the day that the final foreclosure notice arrives in the mail. Tomorrow may be the day that they have to pull the plug on their small business that they struggled so hard to sustain.

This problem began to metastasize, this cancer began to grow in this country in the summer of 2007 when the days of irresponsibly cheap credit and easy credit came to an end and the bubble began to burst. In the part of the country that I represent, between Labor Day of 2007 and Labor Day of 2009, we lost about 36,000 jobs, just evaporated, the way eight million jobs evaporated around this country.

Now, the President took office in January of 2009, inherited what I believe was the worst economic crisis since the Great Depression, and we decided to act to try to take advantage of it, put some people back to work building highways and roads and bridges, cut taxes for small businesses to buy a laptop or a truck or a piece of equipment. We had a substantial tax cut for just about every family in the country; 98.5 percent of American families had a credit so people could buy a home and get a substantial down payment to buy a home. And these steps, although I believe they were in the right direction, opposed unanimously by the other side of the aisle, have taken us in the better direction; but they are not enough.

In my area of those 36,000 jobs we have lost between Labor Day of 2007 and Labor Day of 2009, we have gotten about 16,000 of those jobs back since Labor Day of 2009. So between September of 2007 and September of 2009 we lost 36,000 jobs. From Labor Day of 2009 to the present we have gained about 16,000 of them back.

I worry, Mr. Speaker, tonight, and I say to my colleague as well, that one of the reasons we haven't gotten enough of those jobs back soon enough is the credit crunch in this economy. I hear from entrepreneurs large and small, people running stores and factories and software companies, that they are profitable, they have collateral, they have a track record of paying their bills on time, but they cannot get credit. They cannot get the loans that they need to make their businesses grow.

This lack of credit is rooted in a lack of trust, and this lack of trust is rooted in a lack of confidence, and this lack of confidence, without a doubt, is rooted in the failure of the regulatory system to properly regulate the financial system and assure the investor and the American people they are getting a fair deal.

Now, this House late last year passed legislation that would fix that problem, that would have some even-handed regulators look at whether the system was once again teetering on the brink of collapse, that would say that if you lend money, you have to have some skin in the game. You can't have one industry that makes a profit by originating loans but doesn't collect any of them, and another industry that's solely responsible for collecting the loans but doesn't originate them.

The legislation also said that if these steps to prevent another catastrophe failed, the next time there has to be a bailout of the failure; it won't be paid by real estate agents and teachers and truck drivers. It will be paid by the people who created the mess in the first place.

Now, a version of this legislation is being considered by the other body, and I know that the rules do not permit us to comment on the affairs of the other body, so I will not. I will simply offer this generic observation. When the health care bill was in its final stages of debate, our friends on the Republican side of the aisle loudly insisted, I think correctly insisted, that there be an up-down vote on all aspects of the health care bill, and there was. It was an up-down vote on the underlying text of the Senate bill, and there was an up-down vote on the fixed bill that occurred. That's the right way to do things.

When there is a major question before the country, that will be an up-down vote. I would hope that the other body adheres to that principle. With an issue this significant, with the stakes being so high, I think the American people not only have a right to demand that the problem be fixed. I think they have a right to demand they know that their Representatives go on record and say yes or no. Mr. Garamendi, we say ``yes'' to responsible regulation, we say ``yes'' to getting credit flowing again in this economy and we would say ``no'' to those who would block a vote to block the will of the American people.

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That certainly is my recollection as well that there was virtually unanimous opposition to these new rules of the road, to the people who drove the economy into a ditch.

But I will say this, that at least there was a vote, wasn't there, that the

American people got a chance to see where each of their elected Representatives stood on the question of new rules of the road for the financial industry. The gentleman from California has served in a lot of levels of public service. I believe he served in the California legislature and he served in a lot of other governing bodies. Is it correct that usually when you are trying to solve a problem you put it up for a vote? Is that usually what happens?

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Has the gentleman ever been in a situation where the body sees a serious problem and says, look, we have a plan to fix it, but let's not take a yes-no vote on it because let's let a small number of people decide, because they have some interest persuading them not to support it, that we shouldn't even put it up for a vote? Is that the understanding the gentleman has the way government works in this country?

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It's ironic that this Congress funds what are called institutions for democracy that help to teach fledgling nations around the world how to build democratic institutions, and I am glad we do. I think it's good for the country to do that.

It's kind of ironic that in the context of doing that we have had fiascoes where on two occasions one person has said that extending unemployment benefits to people in grave need can't even be voted on. And now we have a situation where a minority, one would theorize, is going to take a position that says we can't vote on this very important establishment of fair rules to protect the American consumer.

I thank the gentleman for calling this to the body's attention, and I am honored to serve in a body where we do take votes, and we do have majority rule and we do get on with the business of the country.

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