DeLauro Statement on the Financial Rescue Package

Statement

DeLauro Statement on the Financial Rescue Package

Congresswoman Rosa L. DeLauro (CT-3) spoke about the financial rescue package on the floor of the U.S. House of Representatives.

"It is in the interest of the country's economy for the Congress to act on this crisis. I hope that we will act on an amended bill later this week."

Below is the text of DeLauro's floor statement.

"Madame Speaker, our first goal as Members of Congress is to rescue the economy, get it moving again, and make sure the middle class and small businesses get on their feet. That is why I rise in support of this bill, the Emergency Economic Stabilization Act," to restore stability to the U.S. financial markets.

"I hate that near criminal mismanagement of our economy and near criminal contempt for our values has forced us to act today. Today's financial crisis could lead to an economic meltdown unseen since the Great Depression and I have a responsibility to avert it in the interest of the country, though I know it will be unpopular.

"For too long, the policies of this Administration and the previous Majority in Congress put middle class families at risk. The unfolding financial crisis is the direct result of Republican deregulation of the markets and a failure of the Bush Administration and the Federal Reserve to properly identify and address the inherent risks in allowing unsustainable growth to continue in the housing market until its collapse. It was the Republican-led Congress that passed legislation breaking down walls between commercial banks, investment firms and insurance companies. It was the Securities and Exchange Commission that allowed investment firms to take extraordinarily high risks and the Federal Reserve over the last several years that failed to use its supervisory authority to stop lenders from repackaging loans that they should have known many borrowers could not repay. And they send a message to everyone high and low that there are no consequences. But there were. Bad values and bad economics have consequences.

"Moreover, all of this took place during a Republican economy in which wages became stagnant and income inequality grew to unprecedented levels limiting consumer purchasing power as the budget deficit exploded and a significant trade imbalance developed. Meanwhile, the Bush Administration has been engaged in a misguided and mishandled war in Iraq that has cost us dearly not only in blood, but also in treasure at almost $600 billion.

"Although I am under no illusion about how we got here, the crisis demands a large-scale response. I act not to help the banks but to help the hardworking, struggling middle class American the small business people who are the backbone of Connecticut and our country.

"If we do not act, they are the ones who will bear the brunt of these poor decisions and bad values. Unemployment will rise, small businesses will be unable to meet payroll and purchase supplies without access to credit, and families will not get the loans they need to pay for school, cars, and housing.

"To address this crisis the Administration put forward a plan that was totally unacceptable - and I would have voted NO. It would have meant providing an Administration with a history of abusing power and mismanagement with unfettered access to $700 billion of the taxpayers' money and allowing one man, Treasury Secretary Paulson, absolute and broad authority to act without transparency or oversight, producing a windfall for Wall Street.

"While this legislation is surely imperfect, it offers a different approach. The Democrats with the support of some Republicans worked to provide safeguards for the American taxpayer, much-needed oversight, curbs on Wall Street executive pay, and tangible benefits to homeowners who are on the frontlines of this crisis.

"Specifically, the law protects the American taxpayer by providing payments for the plan in installments and allowing Congress to cut off the funding after the first $350 billion commitment; allowing taxpayers to become potential shareholders in aided financial institutions; requiring the President to submit a proposal to Congress in 5 years that recoups from Wall street any projected losses to the taxpayer; and requiring that profits from the sale of troubled assets are used to pay down the national debt;.

"The bill also addresses the need for oversight by establishing a Financial Stability Oversight Board and a Congressional Oversight Panel; requiring public disclosure of any transaction; requiring audits by the U.S. Comptroller General; providing standards for judicial review of the program; establishing an Inspector General office to further monitor and report on the program; and requiring frequent reports to Congress on the program and financial regulatory efforts to provide transparency to the Treasury Department's purchases of troubled assets and ensuring taxpayers and the economic interests of the United States are protected.

"The bill also addresses executive compensation, limiting incentives and prohibiting outrageous severance packages or so-called golden parachutes for the executives that are responsible for this crisis. It requires cooperation with the FBI and other law enforcement agencies investigating fraud, misrepresentation and malfeasance.

"The legislation requires a plan to mitigate foreclosures and to encourage servicers of mortgages to modify loans; allows the Treasury Secretary to use loan guarantees and credit enhancement to avoid foreclosures and otherwise work with other federal entities that hold troubled assets to modify loans; and strengthens the Hope for Homeowners program to increase eligibility and improve the tools available to prevent foreclosures.

"Finally, for this rescue package to succeed, it should be coupled with further bold action to get our economy on track. It means investing in job creating infrastructure, new green energy jobs, and other measures that give consumers more income."

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