Economic Growth, Regulatory Relief, and Consumer Protection Act

Floor Speech

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Mr. DURBIN. Mr. President, I thank my colleague from Texas. I listened carefully to his words about gun safety, and I agree with so much of what he said. He talked about bringing his bill to the floor. I think his bill is a good bill. His bill tries to provide more information into the NICS system. We definitely need to do that. He also said he was open to amendments on the floor. I am as well. I think there are other aspects of gun safety that we may even find common ground on as well. But I might remind him that the decision about the business on the floor of the Senate is in the hands of his side of the aisle.

It is your decision to decide, through your majority leader, what we consider on the floor of the Senate. An effort to do this by unanimous consent is certainly understandable in light of the events of the last few weeks, but if Senator McConnell were to announce that as soon as we finish this banking bill, we are going to move to the Fix NICS bill and have it open to amendment, I think he would find support from both sides of the aisle to do that. I hope he will, because things are changing in America, as they should. Gun violence and the terrible tragedies that occurred in Texas and in Florida and in so many States have really raised consciousness of this issue.

I am a grandfather and proud to be. I have two 6-year-old twins who are first graders in Brooklyn, NY. They are the cutest kids in the world, and I am very objective about that.

About 2 weeks ago, my little granddaughter came home from the first grade and said to her mom: Mom, they told us at school that if there is a shooter outside the school, stay away from the windows, and if a shooter comes in the classroom, get on the floor.

First grade. Is there any sane person in America who thinks that should be a normal talk in the first grade classroom? Is there any person, constitutional scholar or not, who believes the Second Amendment to the Constitution of the United States was designed to allow this to happen? I can't imagine.

Ninety-seven percent of the American people believe in universal, comprehensive background checks to keep guns out of the hands of those who would misuse them, including convicted felons and mentally unstable people--97 percent. The overwhelming majority of gun owners feel exactly the same way. So why in God's Name have we not taken that up since the tragedy in Florida and the tragedy in Texas? There is no explanation for it other than fear--fear of the National Rifle Association and the gun lobby. That is the only explanation.

I salute the legislators in the State of Florida who this last week defied the NRA and defied the gun lobby and passed their own measure for gun safety. I don't agree with parts of it. Giving cafeteria workers in schools the right to carry arms around the school--I don't think that is a wise thing at all. I understand that there is opposition to that from teachers' organizations and even Republican leaders in Florida. But they did stand up when it came to questions about how old you have to be to buy a firearm, a long gun, and other questions that I think are just common sense.

So I would say to my friend from Texas, the majority whip, what you said is something I can support. Bring your bill to the floor, open to amendment. Let us have our day in the Senate where we actually act as legislators, where people will come to the Galleries and not see an empty Chamber but instead will find Members of the Senate, 100 strong, Democrats and Republicans, at their desks, debating measures that make a difference in the life of America. That is why we are sent here.

I had a friend of mine years ago when I served in the House--he was a Congressman from Muskogee, OK. His name was Mike Synar. He was a dear, close friend of mine. Mike lost his primary in Oklahoma because he was fearless. He used to come to the floor when we had votes, and he would see Members of his own caucus kind of wincing, afraid to vote for something they knew was right for fear of the political consequences. He used to get right in their faces. Mike would say: If you don't want to fight fires, don't be a firefighter. If you don't want to stand here and debate controversial issues and vote on them, don't run for Congress.

Mike was right. He was right then, and he is right now.

Let's bring gun safety to the floor of the Senate. Let's open it to amendments. Let's have a fulsome, bipartisan debate. We understand that nothing is going to pass without bipartisan support. We should do everything in our power to exercise the power and the right we are given as U.S. Senators to fix the problems facing American families. This is a problem. It is a problem when a first grader in Brooklyn, NY, has to be warned that if somebody walks into the classroom with a gun, she is supposed to get down on the floor. DACA

This is the week, of course, of President Trump's deadline on DACA students--Dreamers--those young people who came to the United States as infants and toddlers and young people, grew up in this country, pledged allegiance to that flag just as we did this morning, and believed that they were part of America until, at some point in their teenage years, their parents pulled them aside and said: I have to tell you something. You are not legal here. You are undocumented here. You can be deported tomorrow, and we would be deported with you.

They continued their lives with the resilience that a lot of young people show. Some of them did amazing things, even with the knowledge that they weren't ``legal in America.'' They achieved extraordinary things in education and in serving their communities. They did it against great odds because they don't qualify for Federal assistance for higher education. If you go to college and you are one of these undocumented Dreamers, you don't get Federal student loans. You don't get Pell grants. You have to go out and work. You have to save up enough money to go to school. That is the only way. They did it, and all they have asked for in return, all they have ever asked for, is a chance to earn their way into legal status in America. Brought here as kids, they want a chance to prove to America that they love this country and they can make it a better country. That is all they have asked for.

For 17 years, I have come to the floor of this Senate--I know you have to be patient as a Senator, but this is getting a little crazy-- for 17 years, I have come to the floor of the Senate and asked my colleagues, Democrats and Republicans, will you give them a chance? Will you just give them a chance? Let them show you that they can bring something of value to this country. Let them prove to you that they are no danger to this country in any way whatsoever and, in fact--just the opposite--will make us stronger. Give them a chance.

We haven't been able to do it, and President Trump has made it worse. On September 5, he eliminated the DACA protection program. He said that as of March 5, which was Monday of this week, they will lose their protection. The only thing that protects them at this moment is court decisions, which could change in a week or a month. But if those court decisions don't come their way, those young people who have lived here their entire lives, who believe they are Americans and want to be part of America, will be subject to deportation. That is the reality.

The Senate took up this measure a few weeks ago. We gave to the President six different bipartisan solutions to this problem--Democrats and Republicans agreed on six different ways to solve it--and the President rejected every one. He rejected the bill that came before the Senate. Only 8 Republicans--only 8 out of the 51 Republicans--would stand up and vote with Democrats to solve this problem. I wish it were more. We only needed a few more.

Now we are in a position where this Senate again, like the issue of gun safety, is not taking up the issue of DACA and the Dreamers. It isn't as though we are too busy around here, is it, when you look at this empty Chamber and these empty desks? We could do a lot of things here if we were determined to use the power and opportunity that have been given to us by the American voters.

Mr. President, the one pending issue that is before us, I would like to discuss this morning.

Next week, it will be the 10th anniversary of the collapse of the company known as Bear Stearns. As we approach that anniversary, it is remarkable to me that Congress is now debating, 10 years later, an effort to undo the financial reforms we put in place after what was tantamount to a recession or depression hit America. That was the worst financial crisis of our lifetime 10 years ago. Many of us never want to see it repeated.

I am supportive of meaningful regulatory relief for smaller banks, community banks, and credit unions, but I cannot support legislation that rolls back key Wall Street reforms at the request of the same banks that started the crisis.

We know what happened the last time financial regulations were eased: an economic collapse that rippled not just through the United States but around the world. That financial crisis of 10 years ago left our country spiraling into deep recession. It left almost 9 million Americans out of work and our unemployment rate above 10 percent. Families across America lost $19 trillion in household wealth, retirement, and savings. Hard-fought savings that they put aside for their kids' education and their retirement evaporated on a daily basis in the midst of that recession.

In my home State of Illinois, we weren't spared. During the height of the financial crisis, almost 800,000 people in my State experienced mortgage delinquencies and 70,000 more went through personal bankruptcy. I remember going to these meetings where gymnasiums would be filled with people trying to find some way to save their homes because the mortgages they had signed up for had blown up in their faces. This was evident in my hometown of East St. Louis, in the city of Chicago, in Aurora, and many other communities. Of course, the cost of this financial crisis fell, as it always does, on the shoulders of everyday families.

In the wake of those terrible losses and the sacrifices that had to be made, we in Congress said: We are not going to let this happen again. We won't let these banks take control again. We won't let greed overcome common sense when it comes to banking policy.

President Obama signed into law commonsense financial reforms and put an end to some of the worst, inexcusable practices by banks that brought our economy to its knees. These new Wall Street reforms were intended to address the dangerous problem of too big to fail so that American taxpayers would never again be on the hook for the consequences of recklessness and greed on Wall Street.

Systemically important banks whose demise would pose serious risk to our financial system were subjected to higher capital buffers and increased leverage requirements. In other words, if the Federal Government was going to put an insurance program in place to guarantee that it would protect the savers at the bank, we were going to require the banks to do responsible things--don't put taxpayers on the hook for your stupidity and your greed.

Banks were required to report their lending data to ensure that borrowers had the ability to repay the loans they took out and to avoid abusive mortgage practices. Do you remember what happened? People would walk into a bank, and they would be lured into a mortgage they could barely afford to pay, some of them unaware of the fact that there was a balloon provision in that mortgage where the interest rate in a few years was going to dramatically increase and make their monthly payments financially impossible for them.

Many of them said: Well, if the value of my real estate goes up dramatically, then I will just refinance the mortgage. It did not go up dramatically, it went down, and that is when people faced mortgage foreclosure.

So we said: Let's rewrite the rules. Let's not let the banks lead people into a financial obligation that is so risky and so dangerous that we never want to see it again.

The new rules and regulations provided certainty to banks and consumers. And what happened next? Our economy did very well. With this new generation of regulation on banks--it didn't stifle economic growth at all. In part due to these sensible reforms enacted in Dodd-Frank under the Obama administration, our economy now has an unemployment rate of 4.1 percent, not 10 percent. Banks are lending, and bank profits are at record peaks. They are making money hand over fist. In 2016, banks in America made their highest profits ever. This was after the regulations we enacted--the ones they have been complaining about ever since.

How about American businesses? They are thriving. Our gross domestic product grew by 2.5 percent in the fourth quarter of 2017. In fact, since the passage of this Wall Street reform, our economy has grown at twice the rate of other advanced economies, while our stock market has--until just a few weeks ago--hit record after record. You can't argue that we are regulating banks so much that it is hurting the economy when you read these numbers. Nearly all measures in the labor market have fallen below their prerecession averages. This is the result of a sensible, forceful response by Congress to illegitimate and dangerous practices by the banking industry.

We simply cannot afford to return to that thrilling time of yesteryear when banks were not carefully regulated and carefully watched so they didn't go overboard. Instead, as we approach the 10th anniversary of the worst financial crisis since 1929, we should be working to strengthen our financial system, protect families and businesses and the hard-earned money they have saved, and continue to grow our economy.

There is a room just a few steps away from this Senate Chamber on this floor of the Senate where I have been present twice at a historic moment.

The first one, with great sadness, was 9/11. I was meeting in that room as we finally tried to understand what was happening to America with the attacks on the World Trade Center, the plane crashing in Pennsylvania, and the plane crashing into the Pentagon, with black smoke billowing across the Mall. It was that room.

It was that same room where we were called together by the head of the Federal Reserve, Mr. Bernanke, and the head of the Treasury Department, Mr. Paulson. There were probably 20 or 30 Members of the Senate and House in that room when they announced to us that we were within 24 hours of seeing the economy of the United States start to collapse. You never forget those moments. They told us that the banking issues that we have discussed here this morning had led us to the point where we had to step in as a government to save the banking industry in America in order to save the economy of America and perhaps the world.

Those are sobering words, and I remember them well. They inspired us. They drove us to the point where we came up with new financial reform, serious reform, so that there would never be another repeat of that terrible day. We are on the floor of the Senate now arguing about changing those standards of reform.

If we are going into this issue to debate it, there is one part of it that I want to raise. It is one of the seven amendments that have been put forward by the Democratic side of the aisle. I think it is critically important. It deals with an issue that every single Member of the Senate understands if they have spent 15 minutes back home. It is the issue of America's student loan crisis.

For many Americans today, there is no bigger drag on their families than student loan debt. More than 44 million Americans cumulatively owe more than $1.5 trillion in student loan debt. That is greater than the total amount of credit card debt in America.

Unlike most of us who could borrow a reasonable amount to finance our college education, this generation of college graduates starts off with an average debt of $27,000 on day one after graduation. Many have much, much more, especially if they were duped by the notorious for-profit college industry in America.

I hear from young people who have had to forgo home ownership, starting a family, and buying a car because of student debt. I also hear from those who have gone back to school and stay in school because they can't imagine starting to pay back their debt. They dig the hole deeper every semester.

Too often, this debt involves their parents and grandparents. It was reported a couple years ago that a grandmother--who was kind and signed on as a cosigner of her granddaughter's student loan debt--after the granddaughter defaulted, was being chased by the Federal Government, which threatened to attach her Social Security benefits so they could recoup the student loan that her granddaughter signed up for with her cosignature. That is why we are bringing an amendment to the floor, and it should be part of this debate on this bill.

If we are going to talk about reform for banks, let's talk about a reform American families really care about--student loan reform.

One of the things included in this amendment is a borrower bill of rights. Once a student graduates, their loans go into repayment with private financial institutions or, in the case of Federal student loans, servicers contracted by the Department of Education. These servicers are supposed to help the borrowers navigate the repayment process by making sure they are on the right repayment plan, processing payments correctly, and keeping borrowers informed. Well, how are they doing? Between July 2011 and August 2017, the Consumer Financial Protection Bureau handled almost 51,000 complaints related to private and Federal student loans. The majority of the complaints, both private and Federal, addressed difficulties in interacting with lenders or servicers. This is unacceptable. Lenders and servicers should be making repayment easier, not more difficult.

To improve Federal and private student loan servicing, our amendment includes the Student Loan Borrower Bill of Rights. It requires notifications and protections for borrowers when a loan is sold or transferred to another company or when the interest rate or other key terms of the loan change. It establishes a standard for applying payments so that payments are applied in a way that most benefits the borrower. It protects borrowers from unreasonable late fees. It requires servicers to provide borrowers online access to information about their loans, such as payment history and loan terms, and requires key information to be disclosed to borrowers by servicers.

The student loan borrowers' bill of rights also prevents servicers from using predispute mandatory arbitration clauses to prevent borrowers from holding them accountable in court.

While Federal student loan borrowers often face challenges, the situation is worse for borrowers who have private student loans, not government loans. There is now an estimated $165 billion in outstanding private student loans. The Consumer Financial Protection Bureau reported that in 2012 at least 850,000 private student loans, worth $8 billion, were in default.

Private student loans often have uncapped variable interest rates, which can spike to 20 percent and more, and hefty fees, and these loans often lack the protections that come with Federal student loans. Unfortunately, many student borrowers, and even their family members, don't understand the difference between a Federal loan and a private loan, and they end up taking out costly private loans when they are still eligible for Federal loans that are much more reasonable with lower interest rates.

Almost half of private loan borrowers in 2011 and 2012 did not max out on their more reasonable Federal loans and ended up taking out private loans that were worse. That is why I introduced the Know Before You Owe Private Education Loan Act, included in this amendment, requiring borrowers to be notified of the difference and their eligibility.

Finally, the amendment requires private student lenders to offer student loan rehabilitation consistent with Federal student loans. It gives private student loan borrowers who default a fresh start.

My amendment also addresses the key issue of bankruptcy. Did you know that if you borrowed money to buy a second home, buy a car, or buy a boat and then lost your job and couldn't pay off those loans and went into bankruptcy court saying: I don't have any money left, and I can't pay off these loans, the court could discharge those loans for your vacation home, your car, your boat, in bankruptcy, and say: We wipe the slate clean; you filed for bankruptcy, you qualify, and the slate is wiped clean. However, if one of your loans is not for a second home, a car, or a boat but is a student loan, then, the student loan is not dischargeable from bankruptcy. Originally, this was done in the 1970s because there were some students exploiting the system--borrowing money and then declaring bankruptcy after graduation. Then, in 2005 Congress extended nondischargeability not just to Federal Government loans but to private loans, which even extended it to those loans that were given by these notorious for-profit colleges and universities.

So before 2005, private student loans were treated in bankruptcy proceedings like credit card debt and other types of private unsecured debt. They could be discharged as part of a bankruptcy plan to help a student debtor get back on his or her feet. But in 2005, when Congress passed a sweeping bankruptcy reform bill, a provision was slipped in that gave private student lenders a uniquely privileged status. Only a few types of private unsecured debt are nondischargeable in bankruptcy: child support, back taxes, alimony, criminal fines. Now private student loans are part of that list.

Since 2005, lenders have been incentivized to push expensive private student loans on students, many of whom will not be able to repay the loans. This is an enormous problem.

I cannot explain why private student loans are given special treatment in the bankruptcy code. Neither can the Chairman of the Federal Reserve, Jerome Powell, who told the Senate recently that he was ``at a loss'' to explain why we don't allow student debt to be discharged in bankruptcy. He said that the growing amount of nondischargeable student debt ``absolutely could hold back growth.''

We need to address this looming student debt crisis. My amendment would help by restoring dischargeability for private student loans in bankruptcy.

The amendment also clarifies the undue hardship exception that Congress wrote into the bankruptcy code. We said: There is one provision. If you are facing undue hardship, then, perhaps you can discharge even a student loan.

Almost never does a court find undue hardship. Congress did not define the term, and most courts have interpreted the term to have such a high bar that most students don't even try to pursue the exception because of the difficulty and expense of proving undue hardship in court.

We tried to address that. This amendment would provide clarity around undue hardship by identifying situations where there should be a rebuttable presumption that a student loan debtor has an undue hardship. We tried to address it in terms of those who clearly are facing undue hardship and need a helping hand. What are the categories of those facing bankruptcy who cannot discharge current student loans who would be able to discharge them under our amendment? It will be those who have been determined by the Veterans' Administration to have a service-connected disability. Should we give disabled veterans in America a helping hand like this? I think so. How about the family caregiver of elderly or disabled family members or veterans? How about those receiving Social Security disability whose only income is Social Security? How about those who spent years at a low income? Do you think they might be facing an undue hardship and can't pay back a student loan? I think so, and this amendment would give them the opportunity to make their case.

There are other provisions, as well, but I see colleagues on the floor who want to speak as well. I have spoken for a while. I am going to stand down in just a moment.

If we can take up the issue of making it easier for banks to do business in America, can we spare a few minutes to debate whether we can make it easier for student borrowers to survive when the student debts they face are stopping them from moving forward in their lives? These are massive debts that stop them from getting married, buying a home or a car, or starting a family? That is the reality for many families across America.

I hope my colleagues will join me. A lot of us give some great speeches about student loans. It would be terrific if we could allow on the floor of the Senate those speeches and a vote on that critical issue.

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