Tax On Bonuses Received From Certain TARP Receipients - Continued

Floor Speech

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Mr. SANDERS. Mr. President, as a result of the greed, recklessness, and illegal behavior by a small number of executives on Wall Street, the American people today are suffering through the most serious economic conditions we have seen since the Great Depression of the 1930s. Since the recession started in December of 2007, 8.4 million Americans have lost their jobs and, while the official unemployment rate is 9.7 percent, according to the latest Gallup Poll, nearly 20 percent of the American workforce is either unemployed or underemployed. In other words, we have people who are working, but they are working 20 hours when they need to be working 40 hours.

Further, long-term unemployment is soaring. Today, over 6 million Americans have been unemployed for over 6 months, the highest on record. This is not a situation where people are losing their jobs and a few weeks later they go out and get another job. People are losing their jobs and they cannot find another job, which is why it is so important that we extend unemployment benefits and so reprehensible that there are those in this Chamber who have resisted that effort.

Today, there are fewer jobs in the United States than there were in the year 2000, even though the workforce has grown by 12 million since that time.

Today, we have the fewest manufacturing jobs than at any time since April 1941, 8 months before the start of World War II.

Today, home foreclosures are the highest on record, turning the American dream of home ownership into an American nightmare for millions of our people.

Further--and we do not discuss this enough--in the United States today, we have the most unequal distribution of wealth and income of any major country on Earth. That means that while the middle class is in rapid decline, while poverty is increasing, the gap between the people on top and everybody else is wider than in any other major country on Earth and growing wider.

The reality is, today the top 1 percent now earns more income than the bottom 50 percent and the top 1 percent owns more wealth than the bottom 90 percent. Meanwhile, while the folks on Wall Street give themselves tens and tens of millions of dollars in bonuses for having destroyed our economy, the United States has, by far, the highest rate of childhood poverty among major countries. Almost one-quarter of our children today are dependent on food stamps. Approximately 19 percent of our kids are living in poverty, and one out of four kids in the United States, in order not to be hungry, is dependent on food stamps.

While the Fed Chairman, Ben Bernanke, recently talked about how ``the recession is likely over,'' I urge him to meet with America's blue-collar workers or those few people left who do manufacturing in this country. As the Boston Globe reported several months ago:

The recession has been more like a depression for blue-collar workers, who are losing jobs much more quickly than the nation as a whole. ..... [T]he nation's blue-collar industries have slashed one in six jobs since 2007, compared with about one in 20 for all industries, leaving scores of the unemployed competing for the rare job opening in construction or manufacturing, with many unlikely to work in those fields again. .....

Up to 70 percent of unemployed blue-collar workers have lost jobs permanently, meaning their old jobs won't be there when the economy recovers .....

That is a staggering fact.

So when talking about the recession hurting people, it is hurting some of the people who already are in the most serious trouble; people who do not have a whole lot of money to begin with. That is what is going on in the real world today. But, sadly and significantly, what is going on today simply is an acceleration of what was going on the previous 8 years. It is not like, oh, times were good, the middle class was doing well, and, oops, the reckless behavior of Wall Street plunges us into a major recession.

What is not talked about enough is that this continues and accelerates a trend that has been going on for a number of years. During the 8 years of the Bush administration, here is what happened: Over 8 million Americans slipped out of the middle class and into poverty. Over 7 million Americans lost their health insurance.

Our Republican friends are vehemently objecting to us going forward in terms of health care. When they had the power, when they had the Presidency, when they had control over the House and the Senate, during that period millions of Americans lost their health insurance. Do you recall them coming forward and saying: We have to do something about this crisis; more and more people are losing their insurance; more and more people are unable to afford their insurance? I did not hear a word. But they are very vocal now. They are very loud: Stop it. We cannot do anything. No. No. No. They had their chance, and it is sad to say that right now, all they can do is play the obstructionist role and be the party of no.

I make this point not to just relive history but to understand where the anger comes from today. It is not just in the last year and a half millions more people lost their jobs, lost their health insurance. During the 8 years of President Bush, median household income declined by over $2,100--$2,100. So people came out of that period, from 2000 to 2008, staggering. They were earning less than they did before that decade began, and than they walked into the greed and recklessness of Wall Street, which created a massive recession.

The Washington Post reported last January: The past decade was the worst for the U.S. economy in modern times. That was before the Wall Street crash.

Let me say it again. The Washington Post last January: The past decade was the worst for the U.S. economy in modern times. It was, according to a wide range of data, a lost decade for American workers--a lost decade for American workers.

There has been zero net job creation since December 1999. Imagine that. Since December 1999, the country has grown zero jobs. Middle-income households made less in 2008, when adjusted for inflation, than they did in 1999. The number is sure to have declined further during a difficult 2009.

So there you have it. You want to know why people are angry, why people are frustrated, why people are pointing their finger at Washington and us and saying: Hey, we are in trouble: massive unemployment; real wages have gone down; people are working incredibly hard, if they are lucky enough to have a job; and, at the end of the day, they are worse off than they were 10 years ago.

According to a September 2009 article in USA Today--this is quite incredible--and these are statistics that we do not talk about enough: from 2000 to 2008, middle-class men experienced an 11.2-percent drop in their incomes. Can you imagine that. From 2000 to 2008, middle-class men experienced an 11.2-percent drop in their incomes, which amounts to a reduction of $7,700 after adjusting for inflation.

So imagine that you work hard for 8 years. At the end of those 8 years, you have lost $7,700. Even worse, the USA Today article goes on to report that many age group Americans are poorer today than they were in the 1970s. We talk about the American dream and that parents work hard so that their kids will do better than they did.

Well, we are moving in the wrong direction. Today the average American worker, or at least millions of American workers, in terms of inflation-accounted-for dollars are worse off than they were in the 1970s.

Without going through all of the reasons the middle class is collapsing and poverty is increasing, without going into great length about the growing gap between the very rich and everyone else, I think it is important to say a few words about our good friends on Wall Street, people who have made it clear to everybody in this country that the only thing they care about is making as much money as they possibly can in any way they possibly can.

Recently, in the last several years, 40 percent of all profits in this country went to the relatively few people in the financial industry--40 percent of the profits. We have seen hedge fund managers and owners earning billions of dollars. We have seen CEOs of major Wall Street banks being worth hundreds and hundreds of millions of dollars, all the while the middle class collapsed.

We have the highest rate of childhood poverty. Millions of people are losing their health insurance.

We talk about people living in a gated community, people living in very expensive homes protected by armed guards and surrounded by gates, driving around in their chauffeured limousines, getting into their private jets, having no clue about what is going on in the real world. That is what Wall Street is about. They are engaged in producing esoteric financial instruments which very few people understand which are producing nothing real in the real world. They are not creating real jobs. They are not creating real products, real services. They are a gambling casino whose function in life is to make more money for the people who own that casino.

Now, after we deal with health care, and I hope we can finish that as soon as possible, the issue of financial reform is going to come into this Chamber. I hope very much that we can respond to the frustration and the anger of the American people about what Wall Street has done and promise them, through legislation, that those people will never again get away with the crimes they have committed against the working families of this country.

Let me suggest a few of the areas I think a serious and real financial reform bill should address. Every week I hear from constituents in Vermont, and I suspect you hear from constituents in Illinois who say: How in God's name can these large financial institutions we bailed out with our tax dollars now charge us 25 or 30 percent interest rates on their credit cards?

I hear this all of the time. And let's be clear. When a large bank--and about two-thirds of the credit cards in this country are issued by the four largest financial institutions in America--when a large financial institution is charging a working American 25 or 30 percent interest on their credit cards, we have to be very clear and call that what it is. That is loan sharking; that is usury; that is immoral.

The Bible, in all of the major religions--Christianity, Judaism, Islam, all of them--talk about the fact that usury is immoral; that you cannot lend money at excessive rates to struggling people who need that money to survive. That is what is happening today.

The loan sharks today are not gangsters out on the street who break kneecaps. These are guys in three-piece suits who, in some cases, make hundreds of millions of dollars a year by stealing money from working people through excessively high interest rates.

The middle class is collapsing, poverty is increasing, and often, in order to deal with the day-to-day needs of a family, whether it is food, whether it is gas to get to work, whether it is money to heat their homes, people are using credit cards. To be charged 25 or 30 percent is simply immoral, in my view, and it is something that has to be eliminated.

As you know, a number of States all over the country have passed usury laws. But as a result of the Marquette Supreme Court decision a number of years ago, these credit card companies go to certain States--South Dakota--where there are no usury laws and charge anything they want, all over the country. They have nullified State usury laws.

Well, you know what. We need a national usury law. We have to say straight out it is immoral; it is wrong to be charging working people 20, 25, 30, 35 or more percent interest rates on their credit cards. As part of any serious finance reform legislation, the American people have to know we are going to end usury.

My view is--and I have introduced legislation to this effect--that we should do for the private banks what we do with credit unions right now: 15 percent max, except under certain circumstances, which now take them up to 18 percent. No more 25 percent. No more 30, 40, 50 percent. No more payday lending. We are going to end that.

I think that has to be incorporated into any serious financial reform legislation. Any part of a serious financial reform bill has to deal with the need to increase transparency at the Federal Reserve.

I will never forget, about a year ago, the Chairman of the Fed, Ben Bernanke, came before the Budget Committee on which I serve. I asked him if he could tell us which banks received trillions of dollars in zero interest or almost-zero interest loans, trillions of dollars, placing the taxpayers of this country at risk.

Mr. Bernanke said: No, I am not going to tell you that. Well, we have introduced legislation to demand that he tell us. The American people have a right to know which financial institutions have received trillions of dollars in loans. One of the great scams of our time--you want to talk about welfare. There is abuse. These are ``welfare queens.'' We have heard that expression before. Those guys are getting zero-interest loans from the Fed, or maybe they were paying one-half of 1 percent, and then they go out and lend that money to the Federal Government, they buy government securities at 3 1/2 or 4 percent, having taken money from the government at zero percent or half a percent. How is that? You get a nice spread there. You have a 3-percent spread on that. The money that you are lending is guaranteed by the faith and credit of the United States, never once failed. That is a pretty good deal. We give you money at zero interest, and you go out and get guaranteed money at 3 percent. Not a bad deal. That is welfare for billionaires, and that is unacceptable.

We have a right to know which financial institutions are engaged in that. Most importantly, we have to end that right now. So we need transparency at the Fed. They cannot continue to operate in that kind of secrecy.

We also have to end the too-big-to-fail phenomena. Here is a fact that I think many Americans do not know; that is, while we bailed out Wall Street because institutions were too big to fail--if they went down, they would take the whole economy with them--well, guess what. A year later, three out of the four financial institutions are bigger today than before we bailed them out.

Now, what am I missing? It does not make a whole lot of sense to me. Not only that, not only are they a greater danger to the economy today than they were before, but there is something else which is going on which we also do not talk about too much. Maybe as the only Independent in the Senate--I am not a Democrat or Republican. Maybe it is my job to be raising these issues, but somebody has to raise them; that is, the top four financial institutions in this country have enormous amounts of economic power over this country.

As I mentioned earlier, they issue two-thirds of all of the credit cards in this country. Does that sound like a very competitive situation to you? The four largest financial institutions issue two-thirds of the credit cards in America. I do not think that is a healthy thing for our economy.

So not only do we have to end this, these huge financial institutions, because they are too big to fail, but we also have to allow for increased competition within the banking industry, in doing away with this huge concentration of ownership.

Not only do the top four--which is JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup--issue two-thirds of the credit cards, they also issue half of the mortgages. I don't think that is a healthy state for this country. We have to start breaking up these guys.

The last point I would make is maybe the most important. In Vermont and all over the country, small and medium-size businesses are in desperate need of capital, of affordable loans so they can better produce the products and services they need and, in fact, create the jobs our economy desperately needs. I am sure the case is similar in Illinois, but in Vermont, I have small businesses coming into my office saying they can't get the credit they need to expand and create jobs.

You have Wall Street operating as a gambling casino, selling and playing with esoteric financial instruments. It is time they started investing in a productive economy and creating jobs.

The American people are hurting. They are suffering through a terrible moment economically. People are wondering whether, for the first time in the modern history of America, our kids will have a lower standard of living than their parents. This is the reverse of what the American dream is about. People are wondering how they will be able to afford to send their kids to college, how they will pay for childcare, how they will pay for the mortgage on their home, when they are either losing their jobs or real wages are going down.

They are looking to Washington. They are becoming increasingly frustrated by the Republican party of no which seems to gain satisfaction every time they can stop legislation which attempts to address real problems, whether it is health care, jobs, extending unemployment benefits. It is no, no, no from the Republicans.

The American people are beginning to catch on that there have been a record number of filibusters in this session, a recordbreaking number of obstructionist tactics. What the American people are saying is: Hey, Congress, Mr. President, we are hurting. We need action or else the middle class is not going to survive.

As difficult as it is, as much as we understand that when we deregulated Wall Street, they spent $5 billion in 10 years in lobbying and campaign contributions, making sure the Congress did what Wall Street wanted--in 2009, Wall Street spent $300 million on lobbying. I don't know how you spend $300 million on lobbying. There are 100 Members in the Senate and 435 in the House. These guys will spend and spend and spend to make sure Congress does nothing to prevent them from going on their merry way of doing whatever they want without any serious kind of regulation.

In these difficult moments, I hope the Senate and the House will summon the courage to do the job we were elected to do and what we are paid to do, and that is to represent working families and the middle class and not only big money and Wall Street.

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