Providing for Consideration of S. 2244, Terrorism Risk Insurance Program Reauthorization Act of 2014; And Providing for Consideration of Motions to Suspend the Rules; And Providing For Proceeding During the Period From December 12, 2014, Through January 3, 2015
Floor Speech
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Mr. SESSIONS. Mr. Speaker, today the House of Representatives is
considering a rule for consideration of a bill to reauthorize the
Terrorism Risk Insurance Program, or a program known as TRIA. Without
this bill, TRIA is set to expire on December 31, meaning that the House
and the Senate must now act or the program will end at the end of this
year.
Since TRIA was signed into law in 2002, it has served as an effective
means of dealing with the problem of availability of terrorism
insurance. TRIA has enabled the private insurance market to provide an
essential type of coverage that otherwise may not exist.
However, like many other government programs, TRIA needs to be looked
at and reformed in order to serve its original purpose, and that is why
we are here today, Mr. Speaker.
Thanks to the leadership of Chairman Jeb Hensarling and Vice Chairman
Randy Neugebauer of the Financial Services Committee, S. 2244 provides
for many of those necessary reforms that will protect taxpayers,
promote market stability, and provide for economic security for the
American people, all in one, brand-new package.
What we are doing here today is important and essential for many
people, but it is here to maintain the stability of a marketplace.
Mr. Speaker, I would like to take us back to 2001, shortly after the
terrorist attacks on 9/11. None of us will ever forget where we were
when we first heard and saw of the terrorist attacks that attacked our
homeland in New York City, at the Pentagon, and in a field in
Pennsylvania. The accompanying stories of heroism and the deeds by
Americans and others were simply heroism at its finest at a time of
attack on this country.
What some might not remember, though, is the remarkable amount of
economic uncertainty and damage that was caused to America and in the
following weeks and months after 9/11. While we mourned the loss of
many loved ones, our economy was shaken to its core.
Those attacks created and caused $32.5 billion in losses,
approximately $20 billion of which were incurred by insurance
companies. A second similar attack would have left the U.S. insurance
economy insolvent, which in turn, being insolvent, would have
undermined our entire economic structure of the free enterprise system.
That is why TRIA was pressed into law, to provide a Federal backstop to
avoid an immediate terrorism risk insurance crisis.
Sadly, terrorism has continued to be an ongoing threat to our Nation
and, for the foreseeable future, I think that we need to remain
vigilant and prepared for those consequences. So the cost of terrorism
still looms large, and acts of terrorism are uninsurable risks that
could sink our insurance markets without this new, updated program.
In this way, TRIA is a vital economic piece of our Nation's
comprehensive security strategy because it allows for the American
economy to recover more quickly in the event of an attack. I believe it
does more than that. I believe it puts in place building blocks for us
to understand responsibility, economic security, and how we would build
back based upon rule of law and understanding about what would happen
at a time of chaos.
TRIA provides certainty, certainty to our marketplace, by giving
policyholders and insurers the tools that they need to understand and
to develop a market-based solution to the economic threat that could be
posed by terrorism. It gives policyholders and insurance providers the
opportunity to model risk and to diversify their exposure with an
understanding of what the law would provide.
I am encouraged by the reforms championed by, yesterday, up in the
Rules Committee, Chairman Jeb Hensarling from the Fifth Congressional
District of Texas, who has placed many of these new items directly into
the bill as a result of hard negotiation.
These are called reforms, Mr. Speaker, and three reforms stand out to
me as being particularly important.
First, section 102. It would decrease the Federal share of losses
under the program by 1 percentage point annually until it equals 80
percent. That means that the Federal taxpayers will be responsible for
less of the initial costs incurred after a terrorist attack than under
the current law.
Second, section 103. 103 would increase the program trigger to $200
million in $20 million increments over 5 years. This means that TRIA
would not kick in, the government program would not kick in until there
was $200 million in insurable losses following an attack, ensuring that
the government would not only get involved if an attack had a massive
impact, but we would know the rules ahead of time.
Third, section 104. Section 104 would increase the amount of Federal
assistance that the Treasury Secretary must recoup from the insurance
industry following a certified act of terrorism. This means that
Federal taxpayers are getting, once again, a better and well-understood
deal with insurers than they would have gotten before this important
reform.
Finally, S. 2244 would provide a much-needed change to Dodd-Frank. It
is a piece of legislation that was passed a few years ago that is
causing chaos in the marketplace: higher cost, uncertainty, and
overwhelming regulation by the Federal Government. Federal regulators
have interpreted parts of Dodd-Frank to apply to nonfinancial companies
who are called ``end users.''
These end users are people who were never expected to become subject
to the requirements of Dodd-Frank, such as ranchers, farmers, and small
business owners. This Dodd-Frank fix would clarify that true
derivatives end users are exempt from the margin requirements applied
by Dodd-Frank to derivatives contracts. With this reform, end users
will be able to use derivatives to hedge risks, which allows them to
maintain low and stable prices for consumers. That, in turn, frees up
capital that can be used to create brand-new jobs, current jobs, and to
grow our free enterprise system in America.
This fix is not particularly controversial. In fact, the current
policy of requiring nonfinancial companies to adhere to the same margin
requirements as financial companies was not intended when the original
bill passed.
To fix this problem, earlier in this Congress, the U.S. House of
Representatives passed H.R. 634. Yes, I voted for it, along with 410
other Members of this body, in a bill presented by and authored by
Congressman Michael Grimm of New York, 411-12, overwhelming, broad
bipartisan consensus as we looked at the impact of that bill.
Mr. Speaker, I applaud the young chairman of the Financial Services
Committee, Jeb Hensarling, for his hard work. I also applaud the vice
chairman of the committee, Randy Neugebauer from Lubbock, Texas, who
has worked very hard on this reauthorization of TRIA. It is essentially
his bill. It came out of his subcommittee, and he has done yeoman's
work to make sure that we understand what the deal is through law, how
to protect taxpayers, what the government role is, and it means that we
can move forward from here with the certainty that American taxpayers
and the industry have a well-understood deal.
I am also glad, though, that this is good for small business; it is
good for farmers; it is good for ranchers; it is good for Members of
Congress, 411 of us that had voted for pieces of this bill before
today.
Mr. Speaker, I reserve the balance of my time.
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Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
Exactly what the gentlewoman speaks about was part of the long
discussion that we had in the Rules Committee yesterday. The gentleman
from Dallas, Texas, Chairman Hensarling, very clearly went through--
piece, by piece, by piece--the things which the Senate had added which
were extraneous to TRIA and that were in their bill that they passed.
Likewise, the chairman outlined what he was for. He described a bill
that got 411 votes in this body.
One thing was a very pleasant surprise, and I thought it was very
wisely done by the Secretary of the Treasury. I would like to read what
Secretary Jacob Lew said in a letter that was addressed on December 7,
just this week, to the Honorable Charles E. Schumer. Chuck Schumer is
the leader of this TRIA bill in the Senate.
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Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
I thank the distinguished gentleman from Florida not only for the
effort that we have had today but also at the Rules Committee
yesterday, where the committee heard really, really great points,
perhaps on both sides, but great points about how important this
legislation is not only to the country but to the stability of the
marketplace and the ability to keep and grow jobs.
I also heard the gentleman very clearly talk about his displeasure of
having a number of closed rules. And I would just thank the gentleman
for reminding me, as chairman of the committee, and would respond back
that almost every single week we were in session, we put into play more
amendments for Democrats than Harry Reid did in 6 years for any
Republican in the United States Senate. And I have tried to make sure
that what I do is based upon some bit of fairness.
But the facts of the case are, the last time this TRIA bill was on
the floor, then-Chairman Barney Frank asked for and received a closed
rule, so he did the same thing in 2007. Republicans have also, under
these processes, done the same thing, except that in 2005 and 2007,
they were done on suspension, meaning that we had about 10 minutes to
talk about the effort.
Today what we have tried to do is to have a full debate in the Rules
Committee. The gentleman from Florida (Mr. Hastings), among others, was
allowed as much time as anybody wanted to discuss the ideas and fully
vet the views of not only the ranking member and the gentlewoman from
New York but also the gentleman from Texas (Mr. Hensarling) to explain
to the Rules Committee that most Members are not aware of all the
arguments, the real need to make sure that TRIA was done well, and it
was better to do it well. And certainly putting a closed rule means we
can get through things in these remaining days. Good legislation--this
bill is a 411-vote piece of legislation.
You heard from Chairman Neugebauer from Lubbock, Texas--really, the
architect of much of this legislation and the person who has the
authority and the responsibility to the subcommittee--who worked with
Chairman Hensarling to develop leading-edge ideas that they could feel
free to bring to this body and support.
So I think it is just critical that we are here today. We are going
to get our work done. It is really noncontroversial, except if we just
want to roll over and second-guess what the Senate wants to do. They
had their shot at it, and they added some ``extraneous measures,'' none
that had been passed with 90-plus percent of their body. We are going
to work through this, and it is going to be doing the right thing for
the right reason.
As I have said, I think it is important that we know why we are here,
what we are doing. We have talked about the Secretary of Treasury,
Secretary Lew, writing a letter to Chuck Schumer, the lead in the
Senate, saying, Hey, listen, let's get this thing done. It is so
important.
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