[Congressional Record Volume 155, Number 7 (Tuesday, January 13, 2009)]
[House]
[Pages H168-H169]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          BAILOUT BILL IS BACK

  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
California (Mr. Sherman) for 5 minutes.
  Mr. SHERMAN. Well, the $700 billion bankers' bailout bill is back. 
Many of my colleagues didn't enjoy voting on it twice last year, but it 
is back. It is back with two votes--one vote this week, one vote next 
week. This week, we will vote on Chairman Frank's bill (H.R. 384) to 
improve the TARP legislation, the $700 billion bill. I believe that 
Chairman Frank's bill is a step in the right direction but 
insufficient. Then on Friday, the Senate is expected to take up a 
resolution of disapproval. As you remember, the bill we passed last 
year, TARP, says that the executive branch gets the last $350 billion 
as soon as they ask for it, or 15 days after they ask for it, unless 
both the House and Senate pass a resolution of disapproval, and it 
provides for expedited consideration of such a resolution.
  So next Friday, January 16th, the Senate is expected to vote on a 
resolution of disapproval. Then on the following Wednesday, January 21, 
we will vote on a resolution of disapproval. Such a resolution would be 
effective only in the unusual circumstance that it passes both Houses 
of Congress, and even then it is subject to a possible Presidential 
veto. Still, this House must carry out its responsibilities.
  This week, hopefully the Rules Committee will allow us to consider 
amendments to strengthen Chairman Frank's bill. And next week we have 
to vote on releasing the second $350 billion. When we vote next week, 
we will at that point have before us just the existing statute passed 
last year, because even if Chairman Frank's bill passes, even if it is 
made much stronger than it is now, it will be languishing in the Senate 
next week, and we in the House will have no idea whether it will ever 
become law. So when we vote to release the second $350 billion, we're 
basically voting again for the TARP bill, except for three differences.
  First, we know a lot more now than we knew then. Second, the 
unprecedented transfer of money and power to the administration will be 
to the new administration in which many of us have far greater faith. 
And, finally, we will hopefully have before us a letter from the 
incoming administration indicating how they will use the enormous power 
and discretion conveyed by the existing TARP statute.
  It is my hope that such a letter be explicit, be unequivocal, and be 
comprehensive. Explicit, so that we know exactly what they're going to 
do and what rules they're going to live by. Unequivocal, hopefully 
signed by the President, and a clear statement of the rules the 
administration will live by, not just a statement of principles or 
present intentions. And, finally, comprehensive. It should deal with 
the concerns that we all have, or that so many of us have, about the 
existing TARP legislation.
  Chairman Frank's bill will deal with transparency and deal with home 
foreclosures. And my hope is that since

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Chairman Frank's bill won't be law next week, that the President-
elect's letter will address those issues explicitly and unequivocally. 
Chairman Frank's bill calls for us to get 15 percent warrants when we 
make investments in banks. I am pleased to report that after 
discussions with the Chairman and his staff, he is going to make it 
clear in his bill, and I hope it is clear in any letter we get from the 
Obama administration, that 15 percent is a floor, not a ceiling, and 
that the Treasury should be obligated to work to get us all the 
warrants that we deserve as taxpayers for the risks that we are taking. 
The taxpayers should be fully compensated for the enormous risks we 
take when we invest in troubled Wall Street firms.
  Now I am going to offer an amendment to Chairman Frank's bill to 
state that while a company is holding our TARP money, they should not 
pay a penny in dividends and they should not purchase any of their own 
stock back from their existing shareholders. If the company has extra 
money, give the taxpayers our money back. Don't give it to your 
shareholders.
  We do have a letter from Larry Summers, who will be playing a key 
role in the White House, saying, and I don't know if this is intended 
to be binding on the incoming administration, that they would favor 
strict limits on dividends and modest limits on stock repurchases, but 
we need stronger protections for the taxpayers.
  I hope very much that we are able to work on this issue and other 
taxpayer protections.

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