Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act of 2012

Floor Speech

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Mr. DURBIN. Mr. President, our colleagues on the other side of the aisle have an interesting grasp of history. How else can you explain their choice of this week to push for the repeal of the most significant Wall Street reform since the Great Depression? For those who need a reminder, it was 24 years ago this week, October 19, 1987, that the Dow Jones Industrial Average suffered the largest 1-day percentage drop in history. It was known as Black Monday. The Dow Jones lost 508 points that day, more than 22 percent of its value, $500 million in wealth destroyed in 1 day. It took the Dow Jones Average 2 years to recover from Black Monday. Financial markets had not experienced such a disastrous decline since the stock market crash of 1929 that set off the Great Depression.

Most of us thought we would never again see such an event. Then came the financial crisis of 2008. In between

time, I might mention, there was a savings and loan crisis. But then came the 2008 financial crisis. And 3 years after the near collapse of AIG set off the 2008 financial crisis, big banks and big Wall Street investment firms are once again extremely profitable. Most of the banks reported their earnings this week, and the biggest names made the biggest profits ever.

Wall Street CEOs are still pulling down salaries and bonuses worth tens of millions of dollars a year, hundreds of times more than the average worker's income. Most Americans are still struggling. The financial crisis of 2008 wiped out millions of jobs.

I recall the month President Obama was sworn in as President. I stood there on that cold January day, and as he took his hand from the Bible, I realized we had lost 750,000 jobs the month he took office. And, unfortunately, it preceded him and continued for some time. There are now 24 million Americans unemployed or underemployed. Millions have lost their homes. Millions more are in danger of joining them.

Nearly one in every four mortgages in America is now underwater, which means that the owners owe more on the mortgage than the value of the home. In the last 4 years, many Americans have seen their home values plummet by nearly one-third since 2007, and their retirement savings cut in half. We are paying a heavy price for the perfidy of Wall Street.

Solid, well-run companies across America, many in business for decades, have been shaken to the core and cannot find credit to either continue in business, expand their business, or hire new employees. What do our Republican friends offer as a solution? They want to repeal--repeal--the reforms that Congress passed to reduce the reckless risk taking and deception on Wall Street. They want to repeal Wall Street reform.

They want to repeal the Sarbanes-Oxley reform that was put in place after the debacle of the Enron Corporation. They are offering the same mistaken policies of the last decade. They want us to repeat the same mistakes that led us to a near meltdown of the global economy.

This effort to repeal Wall Street reform is part of a larger Republican campaign to prevent government from passing and enforcing reasonable rules that protect our environment and safeguard America's food supply, pharmaceuticals, and consumer products. Cut taxes on millionaires and billionaires and get rid of government regulation, they argue, and the economy will make a dramatic return. That is what they believe.

But if that were true, the last administration would have been the most prosperous in history. Those were the hallmarks of the George W. Bush administration: wage two wars but do not pay for them, but cut taxes on the wealthy and try to diminish regulation, when it came to oversight on the largest corporations, banks and financial institutions.

Instead, the George W. Bush administration produced ``the worst jobs record on record.'' Those are not my words. This is a quote from the Wall Street Journal. They said: The Bush years produced the worst jobs record on record. And they followed the same playbook that the Republicans now offer as their idea for revitalizing the economy.

During the Bush administration, we saw the largest tax cut in our Nation's history with nearly all the benefits going to those at the top. It was the first time any President in the history of the United States cut taxes in the middle of a war. That is counterintuitive. A war is an added expense to government. Cutting revenue to government at that point invites deficits, which President Bush saw during his term--his 8 years.

The debt of the United States doubled during President George W. Bush's term in office. Regulatory agencies were underfunded, overwhelmed, and they were represented many times by people who had no interest in their mission. In the financial services industry, many Federal agencies turned a blind eye to activities that led to the global financial meltdown.

The Securities and Exchange Commission under the Bush administration allowed America's largest financial institutions to self-regulate, police themselves. The Federal Reserve declined to use its power to regulate subprime mortgages, which led to the terrible housing crisis which we still face today. The Comptroller of the Currency used that power to preempt State consumer laws on subprime mortgages, exactly the opposite of what they should have done.

Under the previous administration, unregulated mortgage brokers sold reckless loans, including infamous liar loans and ninja loans. Those are the no-income, no-asset loans. Major financial institutions packaged the bad loans as securities, which they then sold as investments. Credit agencies blessed those toxic assets with AAA ratings, while being paid by the very companies that were selling the loans. The fix was on.

Insurance companies such as AIG insured toxic assets against loss, turning junk into gold. Investors all over the world then bought those assets, sowing the seeds for the economic crisis we still suffer from today. It was a daisy chain of deregulation and disaster. And what do we hear from the Republican side of the aisle? Let's go back to those thrilling days of yesteryear. Let's repeal Wall Street reform. Let's let Wall Street, like 10,000 flowers, bloom and we will get back into a strong economy.

America knows better. We have seen this movie. We know how it ended in 2007, and we do not want to see it again. This was not the first time. In the 1980s, savings and loans were deregulated, made reckless investments, and eventually had to be bailed out by taxpayers to the tune of $130 billion. And $130 billion is bad enough. It was almost $800 billion for the TARP bailout of the big banks under the Bush administration.

The Dodd-Frank Wall Street reform bill requires institutions that sell nonstandard mortgages to keep at least 5 percent of those mortgages on their books, reducing the risk that they will try to pass toxic assets off as solid investments. Under the new rules, banks have to make sure that borrowers can repay the loans. Lenders are forbidden from steering into expensive loans borrowers who cannot qualify for more affordable mortgages.

A new Consumer Financial Protection Bureau will look out for the interests of consumers and prohibit the sale of abusive mortgages and other risky and destructive financial products. I cannot think of another agency of government, not one, that the Republicans hate more than the Consumer Financial Protection Bureau. I want to tell you, I am proud that I introduced the first bill on this issue, working with Elizabeth Warren, a Harvard law professor. We put together a bill. I credit Senator Dodd and Congressman Frank for rewriting provisions and including it in Wall Street reform.

I think it is about time we had one agency, just one in our Federal Government, that is designed to look out for and help consumers and families across America, to save them from the tricks and traps that are thrown at them which they could not possibly understand when they look at the fine print of their mortgage agreements and their credit card agreements and things that even lawyers struggle to understand.

This one agency, one single agency, with the limited power given to it and the limited resources given to it, is the target--it is ground zero for the Republican attack. They do not want to have even one agency of government focusing on protecting America's consumers. The new Wall Street reforms tackle the dangers of too big to fail. We saw what happened there--almost $800 billion in bailout funds to the biggest banks in America. They, of course, had made some stupid decisions, greedy decisions, selfish decisions. We paid for it. Everybody paid for it, with savings that were lost and pension plans diminished. And then, when they were about to fail, in came the previous administration and said we have to save them or there will be a global meltdown.

I was persuaded. I didn't want to see a global meltdown. We gave some $800 billion to these big banks. Did they send us a note of ``thank you''? Yes. They sent us a note of ``thank you'' and put it on the back of the most recent bonuses they gave to their officers. They were giving officers bonuses after the bank virtually fails and they have to rely on hard-working taxpayers to bail them out. That was the ultimate irony, but it is the reality of what we faced when we passed Wall Street reform.

When Enron collapsed in 2002, shareholders lost between $11 billion and $16 billion, employees lost $2.1 billion in pension plans, 5,600 jobs were destroyed, and Enron's top executives, whose recklessness and greed destroyed the company, received $1.4 billion in compensation.

In 2007, after watching its stock value fall from $300 billion to $6 billion in 2 years, Citigroup pushed its CEO, Chuck Prince, out the door--and, incidentally, they gave him a $38 million severance package.

In late 2008, with the financial system on the verge of collapse, 17 troubled banks that had just accepted billions of dollars in taxpayer assistance doled out more than $2 billion in bonuses and other payments to their highest earners.

Dodd-Frank, the Wall Street reform bill, reduces the incentive for CEOs to place short-term gains above the long-term health of their companies by increasing transparency and giving shareholders a say over executive compensation. It is another way that the new Wall Street reforms can restore stability and integrity to our markets and sustainable growth to our economy.

Economists still debate the causes of Black Monday 4 years ago, but no one who looks honestly at our recent past can seriously debate what happens when you take the financial cops off the beat and let Wall Street and the big banks regulate themselves. Those who are calling for repeal of Wall Street reform are basically saying we are going to give free rein to Wall Street to make their own rules again. If they are successful, I predict--be prepared--it is coming at us again. Wall Street will overdo it, and their greed and excess will eventually cost average families and taxpayers who have no fault in the process.

We cannot afford to repeat these mistakes--mistakes that almost crashed the global economy. If our Republican colleagues want to join us in creating good, middle-class jobs for Americans, they can help us pass the American Jobs Act.

Let me say a word about that. I know the majority leader will give Republicans a chance to vote on one section of that today. Hopefully, they will join us. It is a section that takes part of the President's jobs act--some $35 billion--and uses it to hire those who would otherwise be laid off if they are teachers, firefighters, and policemen.

Two-thirds of the school districts in Illinois have been laying off teachers. That is not good for the teachers, obviously, and it is not good for the students either. We are trying to make sure we save these jobs and give our students a good education across America in these difficult times.

When it comes to firefighters, we had a rally over in the Russell Caucus Room. A number of firefighters were there. They are asking, of course, for a helping hand to save their jobs in this tough economy.

I didn't know it at the time of the rally, but Tuesday night in Moline, IL, the city council looked at their tough budget and decided to lay off 12 firefighters who are responsible for ambulance service in Moline, IL. The fire chief, Ron Miller, said that he could not in good conscience continue to be fire chief if they are going to take 12 of his firefighters away, that it was not safe for the people of Moline. He resigned. It was an act of principle. It is an indication of how desperate people have become.

The amendment we will have today as part of the President's jobs package will give us a chance, on a competitive basis, to fill many of these jobs for firefighters, policemen, and teachers. I hope some of my Republican colleagues will join us in this effort.

How do we pay for it, incidentally? There is a tax. Let's put it right on the table. It is a tax of one-half of 1 percent on the incomes of people making over $1 million a year. So the first million dollars is not subject to it; the next dollar is. It is one-half of 1 percent. The money that is brought in from that will spare hundreds of thousands of teachers, firefighters, and policemen from being laid off. I don't think it is too much to ask for the people who are wealthy and comfortable in America to share in the sacrifice with every other American family who sacrifices every day in this tough economy. We will vote on it, and I hope we get bipartisan support.

In the meantime, let's not repeal Wall Street reform. We learned a bitter lesson 24 years ago and just 4 years ago as well. Let's not repeat that bad history.

I yield the floor. I suggest the absence of a quorum.

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