Ending bailouts by ensuring taxpayers are never again on the hook for Wall Street's risky decisions
Protecting families' retirement funds, college savings, homes and businesses' financial futures from unnecessary risk by CEOs, lenders, and speculators
Protecting consumers from predatory lending abuses, fine print, and industry gimmicks
Injecting transparency and accountability into a financial system run amok
Empowering consumers to make the best decisions on homes, credit cards, and their own financial future with a consumer financial protection agency
The legislation now goes to the Senate, which is expected to approve it soon and send it to President Obama for his signature into law.
Today, Republican Senator Jim DeMint of South Carolina objected to giving subpoena powers to the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling. Last week, the House passed this legislation by a vote of 420 to 1. According to Politico:
A spokesman for DeMint said the South Carolina senator himself does not object to giving the commission subpoena power, but was acting on behalf of “members of the Republican conference.”
Giving the bipartisan Commission this critical tool is key to ensuring that it can conduct a complete analysis of the systemic industry and regulatory failures that led to this tragedy and avert future disasters. Subpoena power will ensure the Commission can conduct a complete analysis of the systemic industry and regulatory failures that led to this tragedy and avert future disasters, without being stonewalled by BP or any other entity in its search for answers.
Congress has previously granted subpoena power to commissions investigating national crises, including the Warren Commission following the assassination of President John F. Kennedy and the Three Mile Island Commission following the 1979 incident at the Pennsylvania nuclear power plant.
In objecting to the measure, Senator DeMint and those unnamed “members of the Republican conference” are showing the American people who they really stand for–Big Oil.
The House is currently debating the Dodd-Frank Wall Street Reform and Consumer Protect Act–putting consumers first and ending the era of taxpayer-funded bailouts and too-big-to-fail institutions. In an interview published yesterday, House Republican Leader John Boehner criticized the reform bill calling it “an overreaction to the financial crisis” and likened the worst fiscal crisis Americans have faced since the Great Depression to “an ant”:
Boehner criticized the financial regulatory overhaul compromise reached last week between House and Senate negotiators as an overreaction to the financial crisis that triggered the recession. The bill would tighten restrictions on lending, create a consumer protection agency with broad oversight power and give the government an orderly way to dissolve the largest financial institutions if they run out of money.
“This is killing an ant with a nuclear weapon,” Boehner said. What's most needed is more transparency and better enforcement by regulators, he said.
The worst financial crisis since the Great Depression had its roots in a decade of failure to properly regulate our financial system, acknowledge and address obvious and growing problems and to invest in growing our economy. Irresponsible lending and complex derivatives transactions led to a mortgage meltdown that sent the nation into recession in December 2007. The financial collapse happened in the fall of 2008 with the bankruptcy of Lehman Brothers, the implosion of AIG and the subprime mortgage crisis. Here is an ant’s view of just some of the financial crisis’ impact on Americans:
American workers have paid a huge price–we lost 8 million jobs.
American families have paid a huge price–$17.5 trillion in American household wealth was wiped out during the last 18 months of the Bush Administration.
High-cost Payday Loans are preying on nearly 12 million Americans–they pay a chunk of interest each pay day, costing them nearly $5 billion per year along with other predatory lending. These loans can ultimately carry annual interest rates of 400% or more, with the typical borrower paying about $500 in interest for a $300 loan, and still owing the principal.
2.8 million homes were in foreclosure in 2009 alone. Subprime and predatory home loans, in which mortgage brokers lured families with low, teaser interest rates that later skyrocketed to unaffordable levels, hidden fees and charges, and incomprehensible terms and conditions that brought on the housing crisis and undermined the financial system. More than 60% of subprime loans went to people who could have qualified for lower cost loans.
Total retirement assets, Americans’ second-largest household asset behind their homes, dropped by 22%, from $10.3 trillion in 2006 to $8 trillion in mid-2008.
Financier Bernie Madoff was allowed to defraud investors out of as much as $65 billion in the largest Ponzi scheme in history. The Securities and Exchange Commission (SEC) missed red flags that could have put a stop to his asset management business.
As we rebuild our economy, we must put in place common-sense rules to ensure big banks and Wall Street can’t jeopardize our recovery and hurt hard-working families and small businesses once again. Wall Street may be bouncing back, but we know from experience that left to their own devices they're not going to police themselves.
By a seven-point margin, more Americans have a favorable opinion of the health reform law signed into law earlier this year — 48% to 41%.
By an eight-point margin, Independents favor the new health reform law 49% to 41%.
Overall support for the new law jumped seven percent from May to June.
Congressional Republicans want to repeal health reform–including the popular new Patient's Bill of Rights and other reforms that put Americans, not the insurance companies, in control of their own health care. The Kaiser poll shows the American people — regardless of political affiliation — overwhelmingly support the very benefits of the law Republicans want to take away from Americans:
87% support health insurance exchanges — including 94% of Democrats, 88% of Independents and 77% of Republicans.
82% support giving tax credits to small businesses — including 89% of Democrats, 79% of Independents and 79% of Republicans.
81% support gradually closing the Medicare prescription drug donut hole — including 96% of Democrats, 77% of Independents and 71% of Republicans.
78% support high risk pools for individuals with pre-existing conditions — including 85% of Democrats, 78% of Independents and 67% of Republicans.
76% support subsidy assistance for individuals — including 90% of Democrats, 73% of Independents and 63% of Republicans.
71% support extending dependent coverage to children up to age 26 — including 84% of Democrats, 72% of Independents and 54% of Republicans.
69% support expanding Medicaid – including 80% of Democrats, 71% of Independents and 54% of Republicans.
69% support federal review of health insurance premium increases — including 83% of Democrats, 69% of Independents and 53% of Republicans.
65% support ending gender rating – including 75% of Democrats, 69% of Independents and 60% of Republicans.
64% support eliminating caps on lifetime benefits — including 67% of Democrats, 70% of Independents and 57% of Republicans.
Ensuring there's enough money to pay for the war will require reforming the country's entitlement system, Boehner said. He said he'd favor increasing the Social Security retirement age to 70 for people who have at least 20 years until retirement, tying cost-of-living increases to the consumer price index rather than wage inflation and limiting payments to those who need them.
Leader Boehner believes our nation's seniors and older workers should have their Social Security benefits they’ve earned cut to pay for the irresponsible fiscal policies of George W. Bush and Congressional Republicans–and further suggests that the reason to slash Social Security benefits is not to extend the solvency of Social Security for generations to come, but to pay for the wars in in Iraq and Afghanistan.
Sadly, as Politico reports in an article titled GOP shrugs over Boehner comment, “the reality is that Boehner's comments are hardly out of line with what his own party has said — especially on Social Security and financial reform.”
Ways and Means Committee Chairman Sander Levin (D-MI) and Social Security Subcommittee Chairman Earl Pomeroy (D-ND) issued the following statements on Leader Boehner’s comments:
“The American people should take note of the Republican Leader's proposals to undermine Social Security,” said Chairman Levin. “Generations of Americans have worked long and hard to earn the benefits paid through Social Security and these funds should not be used to pay for anything else, as suggested by Mr. Boehner. This outrageous proposal pulls the cover from the Republicans’ misguided priorities to undermine the universal support Social Security has enjoyed for generations.”
“Republicans want to repeal the estate tax for billionaires and are holding up Wall Street reform, but now say they want to finance a war and reduce the deficit by cutting the benefits that seniors have paid for all their lives” Subcommittee on Social Security Chairman Earl Pomeroy (D-ND) said. “The Minority Leader’s comments today express a dangerous view of one of our country’s most important programs. Minority Leader Boehner wants to put the cost of the war on the backs of our seniors, including tens of thousands of veterans, even as he cries foul at the slightest suggestion that the wealthiest individuals in this country should forgo a tax cut.”
Chairman Levin further said “Democrats have fought against Republicans’ harmful ideas to privatize Social Security, and now the Republican Leader wants to divert funds from Social Security to fund the war.”
Chairman Pomeroy continued, “Social Security is a promise made to all generations, and I am committed to ensuring that promise is fulfilled for both current and future beneficiaries.”
In a recorded interview, the Republican Leader indicated that in order to justify cutting benefits for middle class families he would tell the American people that “we are broke.” The fact is, Social Security is not broke – there is $2.6 trillion of American workers’ money in the Social Security Trust Fund, which is invested in Treasury bonds that are backed by the full faith and credit of the United States.
In an interview published today, House Republican Leader John Boehner tells the Pittsburgh Tribune-Review that Congressional Republicans will “do everything” they can to stop historic health insurance reform–including taking away tax cuts small businesses have now, prescription drug donut hole checks some seniors have already received, and protections for children with pre-existing conditions:
If Republicans retake control of the House, Boehner promised a vote on a bill repealing the health care law and replacing it with a scaled-down package of tax breaks and court reforms…
“We are going to do everything we can to make sure that this law and this program never really takes effect,” Boehner said.
The Affordable Care Act that Leader Boehner and Congressional Republicans want so badly to repeal puts Americans–not insurance companies–in control of their health care. Millions of Americans are already benefiting from the new law:
Over a month ago, the House passed the American Jobs and Closing Tax Loopholes Act to help create or save more than a million American jobs and extend critical unemployment insurance benefits to help Americans who have lost their jobs through no fault of their own make ends meet. Vote after vote, Senate Republicans have obstructed the legislation and now nearly two million families are without their economic lifeline–by July 3rd, about 1.7 million unemployed workers will have lost their UI benefits because of the latest refusal to act by Senate Republicans:
Today, the House debated the Restoration of Emergency Unemployment Compensation Act (H.R. 5618) under suspension of the rules. This emergency legislation would extend the Emergency Unemployment Compensation (EUC) and Extended Benefits programs through November 30, 2010 and retroactively restore benefits to people who may have started losing their benefits as early as the end of May–some after just 26 weeks. Chairman Sander Levin (D-MI):
Those who vote 'no' have no place to hide. This is an emergency for 1.7 million people and their families right now. Therefore it’s an emergency for the community of the United States of America. That 1.7 million will grow and grow under this banner that is floated by the Republicans.
The excuses fall of their own lack of weight. They could not find a single Republican in the Senate to vote for legislation that would create jobs and extend unemployment benefits, so they finger point at those who acted and excuse those who refuse to act.
Republicans bring up the deficit, a deficit that grew under the previous Administration. They can’t hide behind that. This is an emergency. They have not come up with any responsible, feasible way to excuse inaction. Unemployment insurance was extended many times under Republican Presidents, so they don’t even have that excuse. There’s no excuse. What was done under previous Administrations, Republican and Democratic, should be done right today.
I'm afraid Republicans don’t see that there’s an emergency for the soon-to-be two million families without benefits. In terms of economic growth, when you provide unemployment insurance to people, they spend it. So if Republicans are worried about growth and consumer demand, they should work to put money in the pockets of people who are desperate, who are out of work, who are looking for work. Instead, they turn their backs on them.
I want to read a story. I met this person in Hazel Park, Michigan, last weekend. He served three years and nine months in the U.S. Army, including a year tour in Iraq. He has an Associate's degree from a community college and a Bachelor's degree. He was employed by a loan company, a mortgage company as a broker, and then the mortgage crisis came and he was laid off. He was unemployed for three months and then he was hired by K-mart as an assistant store manager. He was laid off in 2009, August, due to store closing. He has currently approximately four weeks left on his extension due to expire on July 14.
There are 1.7 million people like this gentleman in America today. I don’t know how Republicans look them in the face. I don’t know how they explain a 'no' vote. I think the flimsy arguments that are used won’t work in this hall and won’t work back home.
This is an emergency. I really can’t believe that Republicans are going to come here and vote 'no.' They’re voting 'no' for millions. They’re voting 'no' for what I think is best for the United States of America. We are a community of people. When people lose their jobs and can’t find them, we don’t stand and simply stand idly by. This is the time for Republicans to stand up, and the only way to stand up is to vote 'yes.'
I plead on behalf of the millions of people in this country out of work looking for jobs that Republicans stand with us to provide the unemployment insurance that Americans have worked for and that should be provided. Don't turn your backs on them. In the end there will be no excuse.
The bill fell short of receiving the necessary votes (261-155) to pass with the two-thirds majority needed under suspension of the rules. The House will try again to restore this economic lifeline under rules requiring a simple majority for passage later this week. As the Speaker said on Friday, “it really has to happen.”
Today, Congressional Republicans refused to extend a lifeline to millions of Americans who lost their jobs through no fault of their own. They blocked our effort to help struggling families make ends meet, put money in the pockets of our workers, and invest in one of the most cost-effective ways to stimulate our economy.
This is simply the latest example of Congressional Republicans putting partisan politics ahead of the public well-being. It reflects an agenda to return to the policies that produced the worst economic crisis since the Great Depression and that favor special interests and Wall Street over small businesses and Main Street.
The American people deserve better. Democrats will not abandon those hardest hit by the Bush recession and we will keep working to create jobs and strengthen our middle class, while restoring fiscal responsibility.
In an interview published today, Republican Leader John Boehner tells the Pittsburgh Tribune-Review that the Wall Street Reform bill putting consumers first and ending the era of taxpayer-funded bailouts and too-big-to-fail institutions is “an overreaction to the financial crisis”:
Boehner criticized the financial regulatory overhaul compromise reached last week between House and Senate negotiators as an overreaction to the financial crisis that triggered the recession. The bill would tighten restrictions on lending, create a consumer protection agency with broad oversight power and give the government an orderly way to dissolve the largest financial institutions if they run out of money.
“This is killing an ant with a nuclear weapon,” Boehner said. What's most needed is more transparency and better enforcement by regulators, he said.
Last week, the House and Senate conference committee completed its work on the Dodd-Frank Wall Street Reform and Consumer Protection Act. This tough legislation puts consumers first, holds Wall Street and Big Banks accountable, ends the era of taxpayer-funded bailouts and “too-big-to-fail” institutions and is fully paid for by Wall Street.
Instead of backing this critical reform bill to protect Main Street, Congressional Republicans are following the advice of Republican pollster and strategist Frank Luntz. In his memo to Republicans working against Wall Street Reform, Luntz directed them to claim the legislation creates a “permanent bailout fund of private companies…Frankly, the single best way to kill any legislation is to link it to the Big Bank Bailout.”
If this bill becomes law, bailouts and 'too big to fail' will become institutionalized and continue to block healthy competition and growth in the private sector.
But the experts say just the opposite: Sheila Bair, Chair of FDIC:
…Ms. Bair said that new powers allowing regulators to seize and liquidate failing institutions would act like a threat hovering over the financial industry, deterring firms from growing too large or reckless.”
“The fact that it’s there, I think, is going to be important. And if we have to use it, we will,” [Bair said.]
Elizabeth Warren, Chair of the non-partisan Congressional Oversight Panel:
Members of the House-Senate conference committee and their staffs worked through the night to produce the strongest set of Wall Street reforms in three generations. They created a strong, independent consumer agency that will have the tools to rein in industry tricks and traps and to cut out the fine print. For the first time, there will be a financial regulator in Washington watching out for families instead of banks.
MYTH: ‘The bill will put in place permanent bailouts–encouraging risky behavior by financial institutions that expect the taxpayers to come to their rescue.’
FACT: Completely untrue. Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Bush-era days of taxpayer-funded bailouts are over.
The bill establishes a process to dissolve failing large financial institutions in a way that does not wreak havoc on the whole economy; there are no bailouts. These financial institutions will be allowed to fail in an orderly way to protect the economy. Under this authority, federal regulators will shut down any failing institutions that pose a risk to the financial system and our economy. Executives and management will be fired, shareholders will be the first to see the value of their stock wiped out, the company's assets will be sold, and taxpayers and the financial system will not suffer from collateral damage. For markets to function, those who invest and lend in those markets must know that their money is actually at risk if it is not managed prudently. Financial institutions and investors must be responsible for the risks they take.
Any costs incurred in unwinding these financial institutions will be borne by Wall Street firms and the big banks–not taxpayers. The dissolution of a failing firm will be paid for first by shareholders and creditors, followed by the sale of any remaining assets of the failed company. Any shortfall that results is paid for by the financial industry. The bill requires big banks and other financial institutions (with $50 billion in assets) to foot the bill for the failure of any large, interconnected financial institution posing a risk to the entire financial system, as AIG did in the run-up to the 2008 financial crisis. Financial institutions will pay assessments based on a company's potential risk to the whole financial system if they were to fail. Before regulators can dissolve a failing company, a repayment plan to charge Wall Street firms and big banks must be in place to recoup any cost associated with the shutdown.
This bill institutes preventive medicine by making the financial marketplace more accountable and transparent, long before we get to the point of a rescue. It strengthens supervision of large and risky financial institutions with stronger capital standards and rules against excessive and overly risky leverage.
Senator Robert Byrd's extraordinary life has been shaped by service to his state, love of his country, and commitment to the common good. Throughout his historic career in the House and Senate, he never stopped working to improve the lives of the people of West Virginia. While some simply bore witness to history, Senator Byrd shaped it — and strove to build a brighter future for us all.
His story was the true embodiment of the American dream. An orphan at a young age, Senator Byrd refused to allow his circumstances to limit the reach of his potential, his ability, or his drive to succeed. He educated himself, worked as a butcher and a welder, and sought political office to give back to his community and his neighbors. In doing so, he would ultimately make America a better place for every American.
Senator Byrd took pride in his status as Congress' foremost scholar on the Constitution, on the Senate, and on the institutions of our democracy. He never hesitated to speak truth to power. He was a voice of reason during times of war and economic hardship. He was always a gentleman, capable of charming any friend or foe. And he always stood on principle, even when others did not.
Senator Byrd has gone home to be with his beloved Erma Mae. We hope it is a comfort to the Byrd family that so many join them in grieving their loss at this sad time.