Financial Regulatory Reform

Floor Speech

Mr. McCONNELL. Madam President, last night, the Senate took a strong stance on protecting taxpayers from the unintended consequences of a bill that was originally meant to hold Wall Street accountable for its mistakes.

Put aside for a moment the latest talking points the other side is using about Republicans. Our goal throughout the debate has been to protect taxpayers who got burned during the last crisis, and last night's vote showed that those efforts are beginning to yield results.

A $50 billion fund for failing financial firms that would have distorted the market by encouraging the same kinds of risky investments that led to the last crisis is now out of the bill.

A provision that would have given investors in failing firms special treatment is out. Congress will now have to approve any government effort to ensure bank debt. So improvements are being made to this financial regulatory bill in the right direction.

Now it is time to focus on what has emerged as another central point of contention, and that is the new government bureaucracy this bill would create over at the Fed. The first thing to know about this new agency is that Congress would not have any power over it. The second thing to know is what it would do. Some of that is still vague, but the ambiguities are part of the problem.

What we do know is that this new agency would be authorized to gather information on banking and purchasing patterns and on anyone--anyone--operating in consumer financial markets. One provision, section 1071, could lead financial institutions to maintain a record on the number and dollar amount that each customer deposits at bank branches and ATMs.

Now, understandably, a lot of Americans and a lot of small business owners have serious concerns about all of this. They are also concerned about the potential of this bill to further dry up credit at a time when they are trying to dig themselves out of a recession.

We received a letter just yesterday from groups representing hundreds of thousands of businesses--from florists to orthodontists to builders to car dealers--all concerned about the potential impact this new agency would have.

Now, let me state the obvious: None of these businesses had anything whatsoever to do with the financial crisis. None of these businesses had anything to do with the financial crisis. Why on Earth would we want to punish them for the reckless behavior we saw on Wall Street? Why on Earth would we want to punish these small businesses for the reckless behavior we saw on Wall Street?

The fact is, this agency is more about using this crisis as an opportunity to slip a vast new European-style regulatory bureaucracy past the American people than it is about holding Wall Street accountable.

I say let's focus on Wall Street and the GSEs and leave ordinary Americans out of this. Let's put the middle-class families and small business owners who shouldered the burden of this crisis ahead of the bureaucratic wish lists in Washington. At a moment of near double-digit unemployment and exploding debts and deficits, let's have at least one Democratic idea for expanding the reach of government on the shelf.

Later today, the Senate will have an opportunity to blunt the potential impact of this agency. Senator Shelby and I have joined several cosponsors on an amendment that would deflect the focus of this bill from Main Street and back to Wall Street where it belongs. Let's take the bill off Main Street and send it back to Wall Street where it belongs.

The National Federation of Independent Business supports our amendment because, in the place of this new bureaucratic agency, it would establish a new division within the FDIC that would oversee mortgage originators and other big financial service providers. That is where the target should lie--not on the backs of America's small businesses and middle-class Americans who expected to be protected by the bill, not punished by it.

I urge my colleagues on both sides of the aisle not to lose our focus in this debate. I also urge everyone to support the Shelby-McConnell amendment.

Madam President, I yield the floor.

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