Restoring American Financial Stability Act of 2010--Motion to Proceed

Floor Speech

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Mr. WHITEHOUSE. Mr. President, I am here because for the second day in a row the Republican minority has once again sided with the Wall Street bankers and taken their side in the battle the American people want us to have to clean up Wall Street and see to it that the kind of economic damage that reckless gambling by Wall Street created across our whole economy never happens again.

We want to bring sensible, firm oversight to these Wall Street banks, and we want to create an independent consumer financial protection agency so that there is an institution out there that is looking out for the little guy, the person who can't hire a lobbyist or a lawyer and who has to take it or leave it when the bank comes calling.

The history of what brought us here is instructive. It says a lot about the motivation of what is going on on the Republican side.

We began with the most colossal bank failure and economic meltdown since the Great Depression. This body had to appropriate hundreds of billions of dollars to prop up the financial sector and save it from complete and utter collapse from a global financial meltdown. That is how dangerous the way Wall Street was playing was. It took us right to the brink of global financial meltdown and required unprecedented--and unpopular--actions by Congress to keep that from happening.

You would think the lesson everybody would take from that experience is that Wall Street needs to change, that there needs to be regulatory reform. This cannot be allowed to happen to American families again because wild speculators on Wall Street are playing unregulated games with other people's money. But from then until now, we have seen no Republican bill. Chairman Dodd laid down his first bill on November 19, 2009, and the Republicans didn't answer with an alternative of their own. There was no basis from which to negotiate back and forth. They just criticized his bill, and that was that.

Negotiations continued--persistent negotiations--to try to get some Republicans to support Wall Street regulatory reform, and they led nowhere. Were Senators negotiating in good faith but being reeled in at the end by the leadership? Was it just a way to waste time with false negotiations to keep us from getting to this business? I don't know; I am not a mind reader. But what I do know is that there was no Republican alternative.

Eventually, Chairman Dodd said: OK, we are going to hearing. We have our bill. Bring your amendments. Let's have a public debate in the Banking Committee about how we regulate Wall Street.

On March 23, Chairman Dodd convened that markup. I know our committee members came expecting a long haul. They were expecting late nights
and many days. They were expecting the kind of effort we saw when we did the health care reform bill, and I had the pleasure to serve on the HELP Committee with Chairman Dodd.

Day after day, week after week, hundreds of hours of hearings we went through amendment after amendment after amendment. We accepted 160, I think, Republican amendments in that process. We still didn't get their support, but at least there was a public discussion.

But when the Banking Committee took up this bill, with that same expectation that there would be long, arduous hours of hearings, argument, public debate, and amendment, what did they get? The ranking member said: We have no amendments. We don't care to discuss this. Call up the vote on the bill. We don't want to do anything in the public light of day. Vote the bill out.

So the chairman had no choice but to do that. He had no choice but to vote the bill out with no amendments. So here we are. We have gone from the worst financial disaster the country has seen since the Great Depression until this point, and the Republicans have no bill, no reform to offer. When it comes to their first opportunity, when their hand is forced in the committee to bring in amendments, they have no amendments, nothing to say.

Now we try to move to the bill, and here we are--stuck.

We are not here voting on the bill, we are here trying to get their clearance to bring up this bill to discuss it and go through the Senate process of debate and amendment and they are objecting to that.

So what is the common theme of a party that has no bill, that offers no amendments, and that wants no floor debate? The common theme of those things is wanting to cut deals in the dark, wanting to have their deals not see the light of day until they are already buried in a bill. Some of them would probably even turn around and object to some of the things they argued to get in.

We should be prepared to do the public's business in the light of day. In fact, after the most public process we have ever seen on health care, we took criticism from the other side for a couple occasional moments when people got together and cut a deal. But those were the exceptions in a hugely public process, ranging across several committees that took weeks and months, in which everybody knew where we were going, what we were doing, and what our priorities were to help the American people. This is the exact opposite. They do not want to do anything in the light of day. They do not have a bill where they are prepared to show the American people what their ideas are. When you say to them: OK. Our idea is, how would you change those, they have nothing to say. They do not want to debate, discuss or amend.

When we call them to the floor to say: OK. Here we go, let's have this discussion for the American people, they say: Nope, we don't want to have a discussion, not until we have cut our deals, not until we have gone into backrooms and cut our deals, not until we have delivered for Wall Street in backroom deals we wouldn't bring to this floor because we know what they would look like in the bright light of day.

That is where we are. Frankly, it is unfortunate and it is a shame for the American people because every day we continue with this is another victory for the Wall Street mischief. Every day we are delayed is another day that the champagne corks are flying out the window of the investment banks on Wall Street as they celebrate the fact that more highly leveraged gambles can go through because we haven't regulated them, more mortgage brokers can go out and sell junk mortgages to folks and take advantage of them with conditions that are buried deep in the fine print that they do not see. More people can get stuck in credit card tricks and traps that are unregulated by an independent consumer financial protection agency to stand up for them. Of course, the CEOs continue to get huge bonuses without the kind of governance this bill would put over executive compensation.

Why do they do it? Well, the relationship between the other party and Wall Street is pretty well known. It has been publicly reported that leaders of the other party went running up to Wall Street not too long ago to have their favorite closed-door, private meetings in the shadows, no publicity, no press. They would not discuss what took place in those meetings, but you know they went up there to offer their services to Wall Street to help defeat this legislation. They just don't want to talk about it.

So that has been pretty well established, and it runs afoul of the desires of the American people. Two-thirds of Americans want us to take action. As those of us who have spent time in public life know, usually people care about issues that relate to them very immediately. They care about pocketbook issues. They care about their family, the roof over their head, their paycheck. For a lot of folks in America, Wall Street is a long way off, and it is almost a kind of hypothetical concern for a lot of Americans. But they have it, just as strongly as they care about the economy right now. Because they know Wall Street has been taking advantage of America for too long; that the risks of it for ordinary families, when it gets out of control, are too great; and that Wall Street needs to be reined in. They know that, and that is why they want us to act.

That is why it is a shame that the minority party is refusing to allow us to even go to the bill and have a public debate in the light of this Chamber, in the light of day, about our ideas. We have told the American people what our ideas are. They are in the bill. Here are our ideas: Our ideas are a strong Consumer Financial Products Safety Commission--an independent consumer financial products protection agency to look out after the little guy.

How often have you looked at a credit card application and seen how many pages of small print are in it? Look at a mortgage. Look at any kind of commercial credit. In all that small print, the lawyers and the lobbyists have done their work. Too often, it is the person who signs on the bottom line who ends up discovering they signed up for a raw deal. Nobody is looking out for them. Nobody is putting at the top of the contract: Green light. This is fair. We have taken a look at it. Safe, good to go, Good Housekeeping Seal of Approval--or yellow light: Careful. You might want to truly know what you are doing before you sign up for this--or red light: Bad deal. Dangerous for consumers. Look out.

Simple, helpful information for American consumers to get, an independent commission to help advise consumers in those ways and have some regulatory authority over the people who put those products together, that is what we want in this bill. It is not fancy. It is not tricky. It is just a way to unwind the ``gotcha'' contracts that too many Americans have had to put up with for too long because Wall Street and the bankers have been writing those contracts and there hasn't been discipline over them.

So that is one of the ideas we are out there with. If they have a better idea, where is it? I don't want to deal that away in the dark. Come to the floor and tell us in the bright light of day what better idea you have than a consumer financial protection agency that is independent and out there to help the ordinary folks.

We would also consolidate bank regulators so that a big Wall Street bank can't shop around and decide which regulator it wants to have regulated. You don't get to choose your ref when you go to play a game, and you shouldn't get to choose your regulator when you go out into the field of commerce. It allows game playing and it is not right.

We should strengthen regulation over all financial firms and no more allowing them to change their charter to avoid rules they do not like. That is not complicated. That is simple. It is clear. It is our position in the bright light of day. If they have a better one, where is it? I am not going to deal that one away in the dark. It wouldn't be right.

There are provisions that would crack down on CEO compensation, to make sure shareholders have a real say in executive pay and to make sure, in particular, that the compensation committees of the board that sets executive pay aren't just the pals and the golfing buddies of the people whose multimillion-dollar pay and bonuses they are approving; to make sure it is independent directors who are on the compensation committee and making those decisions. That is our position. It is clear. It is out there in the bright light of day. It makes sense. If they have a better idea, bring it. We are happy to listen to it.

But this room is empty of Republicans right now. There are no ideas, there are no alternatives. All they want to do is deal this stuff away in the dark and it is wrong. They will, however, attack it. They will say that a provision in this bill that provides for the banking industry to fund an orderly failure and wipeout of an existing bank so the government doesn't have to come in and bail it out, because there is no provision for an orderly failure, is actually taxpayer-funded bailout legislation. I mean, they couldn't be more wrong. The argument doesn't even make sense.

For starters, there is no bailout. The bank isn't bailed out. It is put out of its misery, but it is put out of its misery and sold off in an organized way. So as far as a taxpayer-funded bailout, there is no bailout. As far as it being taxpayer funded, it is industry funded. There is no taxpayer money in the deal at all. We make the industry pay to basically have a funeral plan for their colleague banks that fail so the taxpayer doesn't have to be there.

They turn that completely inside out, and they do so why? Not because it is true--we know that--but because they have a pollster who has taken a poll and who has discovered that, guess what, the American public doesn't like bailouts and doesn't like bailout bills. So, aha, the geniuses discover they are going to call this a bailout bill because that makes it seem unpopular. It doesn't matter that it is not true. A little confusion never hurts when you don't have a position of your own that you are willing to bring out in the light of day. But that is what they have to say about that provision.

That is actually a provision that I think makes a lot of sense. There has to be a way to have an orderly failure of a bank that goes insolvent so the taxpayer doesn't have to come in and prop it up because people worry, if one goes, is there a run on the bank? What does this mean for the global banking system? You have to have a way for banks to fail, for managers to be fired, for shareholders to lose their money, for all the consequences for failure in a real market system to happen but in an orderly way. That is what the bill does.

So you can go through this bill idea by idea, and I am willing to stand by the Democratic ideas. I actually have some amendments, if we could get to this bill, that I would like to see called up because I think we could improve it. I would love to see us reverse a decision called the Marquette decision--a decision by the Supreme Court that said the rules for a bank are determined by the State where the bank has its headquarters--where it is domiciled, and if there is a conflict between a State law that protects the consumer and the State law for where the bank is, it is the home of the bank that wins.

Well, now, how did that all work out? What happened is the banks figured out the States that have the worst consumer protection laws in the country and they moved there. Not for nothing does your credit card usually come from one of just two or three States.

The result of that is that the power of the States of the United States of America, the sovereign power of the States of the United States of America they have had since before the Revolution to protect consumers from exorbitant interest rates, from rates that were called usury because they were too high, illegally high, was taken away from them. Nobody in Congress made that decision. It slipped through in the back of the Supreme Court decision all those years ago and the industry saw their opportunity and they adapted. If you want to know why you are paying a 30-percent interest rate on your credit card when your home State has an interest rate cap of 18 percent, it is because of that decision.

I am for putting that choice back in the hands of the States to protect their own consumers from these global, international, multinational banks. Global, international, multinational banks, huge Wall Street banks could not give a hoot about Rhode Island. But if they have to obey Rhode Island law, that is another question--Rhode Island law or Colorado law or California law or Vermont law; you name it. The States should be able to protect their consumers the way they always had until this decision--it is part of American history--from exorbitant and cruel interest rates. So I would like to see that amendment.

But the bill as it is, is something we can be proud of. It is a shame that here we are with two votes now back to back, with the Republicans refusing to allow us to even enter that debate. I have wracked my brain to try to think of a way to explain why they are doing this. There are not any good reasons.

One is to prevent progress on anything, anything and everything--the politics of obstruction. If it has President Obama's name on it, if it would reflect well on him no matter how important it is to the American people, forget it. Job No. 1 is to deny any victories, any support to Obama irrespective of the merits. We have seen plenty of evidence of that and maybe that is the reason.

Reason No. 2, they have interests, special interests they want to protect--Wall Street interests, banking interests, people who do not want to see an independent consumer financial protection agency looking over consumer contracts and sticking up for the little guy. That could be another reason. That would explain why they do not want to put their positions on the record anywhere. That is why they will not write a reform bill. That is why they will not put forward a reform amendment in the committee. That is why they will not come to the floor and allow us to debate this bill.

They know their arguments are running against the public interest, the concerns of the American people and the needs of our country, and are just to protect Wall Street. They don't want that in public so they are willing to have this fight. They are willing to blockade even going to this bill, just for the purpose of protecting the darkness in which they want to cut deals to protect Wall Street and the special interests behind them.

That has to stop. Like many of my colleagues I am prepared to stay here, to keep banging away at this, to come and vote over and over again, to spend days and nights on this issue until we get the job done. I take some comfort from some of the stories of history, one of which is the Biblical story of Jericho. When Joshua and the Israelites surrounded Jericho, they didn't go and negotiate and ask them would you please open the door, we will give you what you want. No, they went around the city, time after time--seven times they went around the city of Jericho, blowing their horns, blowing the ram's horn. On the seventh day, on the seventh tour around Jericho, when they blew their horns, Joshua said to the Israelites: Let out a great shout. And they let out their great shout and the ram's horns blared and the walls fell flat.

Maybe it will take seven times around this bill before the walls of obstruction the Republicans have put up to protect the dark deals they want to do for their special interests fall. Maybe it will take seven times. Maybe it will take 17 times. Maybe it will take 27 times. But when you look at the damage that Wall Street caused to this country with its speculative, dangerous practices, with its unregulated, uninhibited excesses, this is important.

This is one we need to win for the American people. This is one we need to win for the safety of our economy going forward. This is one we need for every family that lost their job because the financial catastrophe washed through the business they worked for. They have never been to Wall Street, they have no interest in the financial industry, but they are as out of work as anybody else because of what splashed and sloshed across this country from what happened on Wall Street.

Those are people we cannot forget. Those are people we cannot let down. Rhode Island still has the third highest unemployment in the country. We are in our 27th month of severe recession. It has been compounded by historic flooding that has 2,000 Rhode Islanders still out of their homes. The flooding sure isn't Wall Street's fault but it compounds the harm that Wall Street inflicted on the entire economy, and it focused so intensely in my home State of Rhode Island.

As far as I am concerned, we are here, we are here to stay, we are going to get this done, and we cannot be discouraged by the Republican obstruction.

I see the majority leader on the floor. Would it be convenient to yield to him?

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