Financial Regulation Reform

Floor Speech

Mr. McCONNELL. Madam President, a lot of smart people have thought about how to prevent a repeat of the kind of financial crisis we saw in the fall of 2008. We have heard plenty of ideas. But if there is one thing Americans agree on when it comes to financial reform, it is absolutely certain they agree on this: Never again--never again--should taxpayers be expected to bail out Wall Street from its own mistakes. We cannot allow endless taxpayer-funded bailouts for big Wall Street banks. That is why we must not pass the financial reform bill that is about to hit the floor.

The fact is, this bill wouldn't solve the problems that led to the financial crisis; it would make them worse. The American people have been telling us for nearly 2 years that any solution must do one thing--one thing: It must put an end to taxpayer-funded bailouts for Wall Street banks. It must put an end to taxpayer-funded bailouts for Wall Street banks. This bill not only allows for taxpayer-funded bailouts of Wall Street banks, it institutionalizes them. Let me say that again. This bill not only allows for taxpayer-funded bailouts for Wall Street banks, it actually institutionalizes them. The bill gives the Federal Reserve enhanced emergency lending authority that is far too open to abuse. It also gives the Federal Deposit Insurance Corporation and the Treasury broad authority over troubled financial institutions without requiring them to assume real responsibility for their mistakes. In other words, it gives the government a backdoor mechanism for propping up failing or failed institutions.

A new $50 billion fund would be set up as a backstop for financial emergencies. But no one honestly thinks--no one honestly thinks--that $50 billion would be enough to cover the kinds of crises we are talking about. During the last crisis, AIG alone received more than three times that from the taxpayers--three times that. Moreover, the mere existence of this fund will ensure that it gets used. The mere existence of the fund will ensure that it gets used. And once it is used up, taxpayers will be asked to cover the balance. This is precisely the wrong approach.

Far from protecting consumers from Wall Street excess, this bill would provide endless protection--endless protection--for the biggest banks on Wall Street. This bill would provide endless protection for the biggest banks on Wall Street. It also directs the Fed to oversee 35 to 50 of the biggest firms, replicating on an even larger scale the same distortions that plagued the housing market and helped trigger a massive bubble we will be suffering from for years. So imagine this: If you thought Freddie and Fannie were dangerous, how about 35 to 50 of them?

Everyone agrees on the need to protect taxpayers from being on the hook for future Wall Street bailouts, but this bill would all but guarantee that the pattern continues. We need to end the worst abuses on Wall Street without forcing the taxpayer to pick up the tab. I repeat: We need to end the worst abuses on Wall Street without forcing the taxpayer to pick up the tab. That is what Republicans will be fighting for in this debate. The taxpayers have paid enough already. Taxpayers have paid enough already. We are not going to expose them to even more pain down the road.

The way to solve this problem is to let the people who made the mistakes pay for them. The way to solve the problem is to let the people who made the mistakes pay for them. We won't solve this problem until the biggest banks are allowed to fail.

Madam President, I yield the floor.

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