[Congressional Record Volume 155, Number 9 (Thursday, January 15, 2009)]
[Pages S565-S588]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

                         ACT OF 2008--Continued

  Mr. DURBIN. Mr. President, I ask unanimous consent that all time be 
taken equally from both sides, as I know we are under limited time for 
the debate on the TARP renewal.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DURBIN. Again I renew the request for a quorum call.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. COBURN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. COBURN. Mr. President, would the Chair be so kind as to advise me 
when I have used 7 minutes?
  The PRESIDING OFFICER. The Chair will so advise.
  Mr. COBURN. Mr. President, we have before us today a hallmark piece 
of legislation that is supposed to be about credit and liquidity and 
the significant problems we ran into this last fall in this country 
when we no longer had a functioning, or barely had a functioning 
financial industry that allowed credit to flow which would allow 
commerce to ensue.
  It was my belief at the time, based on what I was told and what I 
saw, that extraordinary measures were going to be required for us to 
handle this significant problem. Consequently, I ended up voting for a 
financial recovery package that I must say has been handled in a way 
completely opposite of the way we were told it was going to be handled. 
That is now water under the bridge. The question before us today is: 
Are we going to give another $350 billion--not through an oversight 
process, through an appropriating process--are we going to write a 
blank check to the Treasury Department to accomplish again what we are 
assured by the transition team and the incoming administration is for 
very specific things?
  I would like to believe that. As a matter of fact, in a meeting 
yesterday with some of the officials of the incoming administration, I 
asked in a closed room where they were giving us this reassurance that 
this administration was not going to put more money into the auto 
industry under the pretext it has been done using the TARP funds; that 
this administration was not going to use this money for other 
industrial segments of our society but in fact would use this money 
only when and if it is necessary to keep liquidity rolling, to keep 
banks' balance sheets to the point where we can accomplish what we need 
in order to have true commerce in this country. And I must say that I 
felt somewhat reassured walking out of that meeting.
  But one of the things I asked for in that meeting was a public 
statement so that the rest of America could have that same assurance. 
We find ourselves today, getting ready to vote on this--and that was 
communicated very directly, by the way, with some of the highest levels 
of the incoming administration--we are about to vote on it, yet there 
has been no public statement whatsoever that would assure either 
Members of this body or the American taxpayers that we are not going to 
be using it to bail out companies that are not competitive and have not 
had to do the hard things to maintain themselves to be competitive; we 
have no assurance we are not going to go to other industries and do the 
same thing; and we do not have, in fact, a public expression, an 
explanation, or a letter of intent of the incoming administration that 
they are going to use it in a very precise and direct manner to 
maintain liquidity of the financial sector.

  The other thing that we have not heard, along with maintaining that 
liquidity, is how the administration will handle the toxic assets, 
which is what we were told the money was for in the first place.
  So I come to the floor this afternoon wanting to support our new 
President. I want to support him. I talked to him about this issue 
prior to his senior staff coming and talking to us. But I find myself 
in the predicament of having been fooled once by the present 
administration not doing what they said they were going to do. They 
have not been transparent as to where and how the money is being spent. 
The American people haven't had access. We don't know the priorities 
under which it was done. And now we are being told again: Trust us.
  Well, I am willing to do that, provided we put out to the American 
people exactly what that means. And the only thing that I can figure as 
to why it has not been forthcoming--that is what we asked for yesterday 
afternoon in the meeting with those representing President-elect 
Obama--is that they do not want to commit. And I regret to say that if 
the incoming administration won't commit on paper and publicly as to 
how they are going to use this money, I am disinclined to vote to give 
it to them. That pains me, because I want our new administration to be 
tremendously successful in the face of all the problems we have.
  To meet the goal of transparency and accountability--which is what 
this new administration is all about, and I believe it will be far 
greater than what we have seen in the past; I will give them credit for 
that--it is required that they publicly tell the American people how, 
when, why, and what they are going to use this money for. And my only 
conclusion would be, in the face of that statement not being 
forthcoming, is that they either have the votes and believe they can 
accomplish this without being forthcoming--which again goes exactly the 
opposite direction of what my friend Barack Obama campaigned on--or 
they weren't necessarily truthful in what they told us on how they were 
going to use the money.
  So I stand ready to try to support them, if in fact we have 
assurances--public assurances and documented assurances--that they are 
going to follow

[[Page S566]]

the intent of what we originally gave the money for. Absent that, I 
would find him be unable to support that and would vote for the 
resolution of disapproval.

  I yield back the remainder of my time.
  The PRESIDING OFFICER. The Senator from Massachusetts is recognized.
  (The remarks of Mr. Kerry are printed in today's Record under 
``Morning Business.'')
  Mr. KERRY. I thank the Chair. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BOND. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BOND. Mr. President, I rise to speak about TARP. The President 
has submitted the request for the second half of the funds. This is not 
an easy decision for Members of Congress. We have lots of questions 
about how the first $350 billion was spent. Questions came from my 
constituents, financial and economic experts, the oversight body. 
Auditors have questions, and I have questions.
  I said in December, the Treasury must account for the $350 billion 
and make the case that the action has aided our economic recovery 
efforts. Taxpayers were promised transparency. They deserve answers. 
But after Congress authorized the funds, the Treasury Department 
abruptly changed course and instead provided billions of dollars in 
direct capital injections into banks without any requirement that they 
write down bad debt. To date we do not have any answer why the change 
was made. Perhaps the Treasury realized it could not operationally 
manage it. Perhaps it was because the Europeans had adopted a direct 
capital injection approach. But we do not know.
  The change is not as important as is the explanation and 
justification. The change in strategy could have been more acceptable 
if Congress and the public understood what reasonable assurances there 
were that there was a coherent structure. Unfortunately, the Treasury 
has not provided concrete evidence that directly or indirectly linked 
the capital injection to the marginal stabilization of the credit 
market and the funds are contributing to the necessary writedowns.
  Some experts also question whether Treasury diagnosed the problem 
correctly and accordingly allocated the funds appropriately. Now, 
Treasury claims TARP has worked because we have not fallen into a Great 
Depression. But when they are not collecting data from the banks on how 
the funds are used, it is kind of tough to point to that.
  We need to focus on the real need for additional TARP funding and 
ensure that the significant questions about management and oversight 
are adequately addressed. In terms of need, let's be clear. I do not 
dispute that further Government resources and actions will likely be 
needed to address the ongoing economic downturn.
  Unemployment is rising, double digits in some places. There are 
continuing credit difficulties. We must not be complacent about the 
prospect of an economic recovery.
  I supported the initial passage of the act because we were assured it 
would run with transparency, accountability, and oversight. 
Unfortunately, we have had independent assessments of the program that 
do not provide any comfort. The U.S. Government Accountability Office 
and the congressional oversight panel have preliminary reports that are 
not glowing and raise additional questions.
  Now, the incoming administration has made statements that it 
substantially agrees with these independent assessments, and it will do 
things differently. To date, however, all we have is a three-page 
letter that generally outlines how they will run it. While I appreciate 
these statements, a three-page letter is a little thin for me to 
approve a $350 billion extra share.
  Taxpayers have bailout fatigue, and I am troubled by Government 
intervention in the private market. We need the private market at some 
point, however painful, to work itself out, and we must force the 
writedown of bad debt to address the solvency of banks. We have not 
seen those assurances, and I am not going to be able to support this 
release before us.
  Many experts have implored the Treasury to use TARP to address bad 
debt that is still held by banks. I believe that should have been in 
the initial provisions. We forced the auto companies to jump through 
hoops. Perhaps on the other hand, they can use a guarantee program for 
a risk-share program.
  Unfortunately, we still do not know how the second half of the funds 
is going to be used. We might have to have a subprime mortgage asset 
restructure trust like the entity we set up to deal with the savings 
and loan crisis. It was painful in the late 1980s, but it worked.
  Unfortunately, as I said, this is not the end of the need to address 
our financial system. Some estimates are that about $1.5 trillion is 
pending, and we are likely to see more requests for funds. But before 
additional requests are submitted, we look forward to the incoming 
administration bringing some coherency and structure to the program and 
provide for certainty and confidence to taxpayers and markets by 
providing the transparency, accountability, and the oversight that is 
currently lacking.
  There are too many unanswered questions about the current TARP. We do 
not dismiss the real threats of more financial turmoil. We can clear 
them up, but things likely will get worse before they get better. I am 
committed to help save the system, but we need a plan to show we are 
going to act responsibly and protect taxpayers while providing more 
accountability, transparency, and oversight.
  The PRESIDING OFFICER. The Senator from Virginia is recognized.
  Mr. WEBB. Mr. President, I would like to spend a few minutes today 
also addressing this very troublesome issue of the next tranche of $350 
billion that is being asked for by the incoming administration. I, like 
many people who supported the initial request on October 1, was very 
disappointed with the differences in the current administration's 
implementation of TARP as opposed to the logic that was presented to us 
asking for our support.
  I would also say if there were a new proposal coming to us from the 
current administration, given this experience, I would probably not 
support it. Given the administration's conduct since October, I would 
not support it. There is, however, an incoming administration that is 
in a situation that was created by Congress's initial vote. It is in 
the middle of this $700 billion proposal.
  I have received concrete guarantees from the President-elect 
regarding TARP. I spoke to him at great length yesterday. I am going to 
support releasing this next tranche. I would like to take a few minutes 
to explain my support. I was one of the first people to originally 
question Secretary Paulson's request last September. I came to the 
Senate floor the Monday after the request was made. I laid out five 
different points of concern we had with the proposal itself.
  I worked with other Members of this body. We had nine Senators join 
in a letter to the majority leader saying that any proposal like this 
had to, first of all, guarantee that it was not one individual in the 
executive branch who was able to make these kinds of decisions; that 
ideally, from our perspective, there should have been a three-person 
panel of honest brokers; that the American taxpayer should be invested 
in the upside of a program like this; that there should be re-
regulation of the financial markets; and that there should be concrete 
limits on executive compensation. We had some movement on those issues 
during the negotiating process led by the senior Senator from 
Connecticut. We did not get all of them, but we did get enough. Coupled 
with the predictions of the catastrophic effect that might occur in the 
world markets without action, I decided to vote for the program. Then 
Secretary Paulson went off and spent the money in a totally different 
way than he told us he was going to.

  The situation now, in my view, is different. I spoke with the 
President-elect. He indicated he was totally comfortable with my coming 
to the Senate floor and saying that he personally guarantees closure on 
all of those issues: that there will be more than

[[Page S567]]

one person in the administration, at least three people in the 
administration, working together to find out the best place to put 
these funds; that American taxpayers are invested; that there will be 
limits on executive compensation; and that there clearly are going to 
be strong proposals, to re-regulate the financial markets.
  We are in a very difficult situation in this body because we cannot 
amend this document. We cannot put these proposals into legislative 
language. We can only vote up or down as to whether this money is made 
available, and I am going to vote to release those funds.
  The distinction for me is that, in the first instance, we had an 
administration that was ending its tenure. It was on its way out the 
door as it implemented the first tranche in, I think, not a fully 
responsible way.
  In this instance, we have a new administration coming in. They are 
ready to be held accountable. The President-elect indicated to me that 
he wanted me to inform this body of the specific guarantees he is 
giving. With respect to the valid concerns that were just laid out by 
the Senator from Missouri, we have plenty of time for debate available 
to us for the larger stimulus package where we can truly sort out what 
type of financial rescue plan we are going to put into place for the 
  So I have struggled with this like so many of my colleagues. I am 
very comfortable with the guarantees that were given by the President-
elect. I am going to vote in favor of this program.
  The PRESIDING OFFICER. The Senator from Kansas.
  Mr. BROWNBACK. Mr. President, I am rising to speak in favor of the 
disapproval resolution. I think we should disapprove the use of the 
TARP funds, and I will outline why to my colleagues and point out the 
reasons and give a little bit of history on this as well.
  I think it is interesting the Treasury Department came here on 
Saturday, September 22, and said: We have to do this. We have to have 
$700 billion to save the financial institutions across the United 
States. We have to do it, and we have to do it now. There were zero 
hearings on the $700 billion. Now, normally, around here you would not 
spend $7 million, let alone $7 billion or $70 billion, without a 
hearing. We did $700 billion without a hearing, and in a rush and in a 
push and people saying: We have to do this now or we risk going into a 
Great Depression.
  This bill passed. Now, my phone was ringing during that period of 
time. My guess is the Presiding Officer's phone was ringing during that 
period of time. Kansans were hot and mad and upset and strongly 
opposed. I think at one point in time we had 2,000 calls against and 40 
for the bill. There was strong opposition. They do not like the idea of 
giving the money to the people who made the mistakes and did the 
wrongdoing in the first place, and it was our taxpayer money. Then, 
what is in the bill--the initial bill was a 30-page bill.
  Now, it expanded some after that, but we did not have a hearing 
process. We did not have a review process. It was: We have to do this; 
we have to do this now, period. It went on through the Congress, and it 
passed. We had two tranches: the first $350 billion and a second $350 
billion, which I argued at the time as well, the second $350 billion 
should require an affirmative vote of Congress. I mean, this is $350 
billion we are talking about. Instead, all we could get was this 
disapproval process which the President can veto. Then it has to come 
back here for a two-thirds vote. So you, in essence, have to get two-
thirds of the Congress to disapprove. Nonetheless, I think we should 
disapprove this proposal, this bill, this additional $350 billion in 
  Now, if the initial proposal was OK, look, we have to have it, we 
have to have it now to support and to keep the financial institutions 
going and properly functioning in the country--that money has been 
spent and the financial institutions are operating. Certainly, there is 
a lot of distress, but they are operating and they are operating 
  So the idea that you have to do it and you have to do it now to 
maintain a fiscal financial system operating is no longer there. That 
is one reason.
  The second one: We ought to spend some time thinking about this and 
whether we want to do this because this has ended up being a rather 
large slush fund. It has been moving from various targets. Initially it 
was said this was going to be used to buy troubled assets. Then that 
seemed like it was going to take too long, so it was put into stock, 
into financial institutions to strengthen their bottom line.
  So there was no real target given, and it was moved and sloshed 
around. Even on auto bailout, at the end of the day, do we want that 
loose of a design model on $350 billion? I would have to argue then, as 
I do now, no. We don't want that loose of a situation.

  Then there is the matter of oversight on this particular issue. We 
have an oversight panel that has reported that Treasury has ``failed to 
address a number of questions asked by the panel itself,'' our panel, 
the congressional panel, in its first report. I don't see enough 
transparency in the manner in which TARP is being executed, and I 
certainly don't see enough in terms of what contingency plans Treasury 
has in mind to use these additional funds to grant carte blanche 
spending of $350 billion that could range from troubled assets, stock 
in banks, an auto bailout. And if that is your initial model of where 
you can spend it, then where else could we spend the additional $350 
billion? Is this on credit card bailouts, on student loans, on another 
industry? It looks as though we don't know.
  Quoting from the oversight panel, they were saying that this money, 
as I mentioned earlier, has failed to address a number of the concerns 
that were previously raised. Indeed, if anything, I think it could be 
argued that the haphazard manner in which these funds were spent has 
increased the financial stress and has injected uncertainty into a 
financial system and an economy already gripped by fear. Almost the 
very uncertainty and the moving back and forth said to the broader 
economy and to the global community: We don't know what we need to do. 
It helped to spread fear rather than to calm the market situation.
  We need to have a calm discussion about this $350 billion. It is very 
difficult for me to go back home and say to my constituents: We 
approved an additional $350 billion and we are not exactly sure where 
it is going to be spent, when they were flaming mad about this being 
approved in the first place.
  While additional TARP funding is not necessarily $350 billion of 
Government spending, I am not convinced it represents a well planned 
and executed investment for taxpayers. Many will say this is an 
investment, not spending. I am not sure this has been well designed or 
thought through of what the investment is. Indeed, it seems as though 
it changes by the day. The Congressional Oversight Panel says it still 
does not know what banks are doing with TARP money already used. So 
here is our own oversight panel saying that we don't know for sure what 
the banks are doing with the TARP money they have already gotten, and 
we are going to approve another $350 billion.
  Without transparency about funding already committed to TARP and with 
only vague notions about how additional TARP funding would be used, I 
cannot vote to allow additional TARP funds to be released. Without more 
transparency and information on plans with a potentially large taxpayer 
cost, I do not see the merits in allowing additional TARP funds to move 
  Those are not simply my thoughts. If you pick up the phone in my 
office, if you travel across my State--and I would say across much of 
the country--that is the sentiment you are going to get, that this just 
is not well planned. It is a lot of money, and we ought to calm down 
and take more prudent approaches, take the simple steps of holding 
committee hearings, looking at what sorts of distressed industries may 
come up, looking in depth at where the TARP funding has already been 
spent and what it is doing, and get answers to those simple, direct, 
but very important questions before we launch into another $350 
billion. I think if the people in this body would listen to their 
constituents back home, they would say: Absolutely, don't just approve 
this. Let's take more time now.
  The financial institutions people, as far as the situation that was 
existing last fall, are saying: This is getting much better than what 
it was at that point. Let's take our time to do it right. I am not 
saying that there isn't stress in the system. There still is. But it 
isn't the situation it was last fall. Our constituents demand that more 
information be known.

[[Page S568]]

  I hope we can do that and take our time to get this right and get the 
oversight right and get the answers to simple, direct, but very 
important questions.
  I yield the floor.
  The PRESIDING OFFICER (Ms. Klobuchar). The Senator from Georgia.
  Mr. CHAMBLISS. I ask unanimous consent to speak for up to 3 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CHAMBLISS. Madam President, I rise in support of the motion to 
disapprove the expenditure of the additional $350 billion. I am one who 
supported the original package back in September. I thought it was the 
right thing to do then. I still think it was the right thing to do at 
that point in time. The reason I thought so then and still think so is 
that we are certainly in a financial crunch. We were presented with a 
plan by the Treasury Department that laid out what we were going to do 
with this $350 billion that was the initial amount authorized to be 
accessed, that that $350 billion would move us in a direction of 
loosening the contraction of the credit markets around the country so 
that banks could borrow money in the credit market from each other, and 
they would thus have money to loan out to businesses as well as to 
  The fact is that the Treasury Department, after telling us the plan 
they proposed to operate to do that, moved in a different direction and 
moved in a direction of providing funding from this initial $250 
billion and now the second $100 billion to fund banks, to provide 
capital to banks that was supposed to be used to buy toxic loans, not 
from individual banks but to buy toxic loans that were packaged at 
banks because they bought the banks. The fact is, it didn't work. It 
has not worked at all. We have not seen a loosening of the contraction 
of this credit market.
  For us to come in today and be faced with a vote here today in the 
short term relative to accessing the second half of the $700 billion 
without having a plan that we have some assurance is going to work I 
believe is the wrong direction to go. Not only that, but as a part of 
the original $350 billion, there was some $20 billion or so that was 
accessed and given to the automobile industry, either through direct 
funding to automobile companies that are domestic companies that are in 
trouble as well as funding that went to GMAC, a financial arm of the 
automobile industry. That was never intended when we debated and voted 
on the original plan back in September of this year.
  As my friend from Kansas said, it needs to be a written plan that is 
thoroughly thought through by folks who are certainly smarter than I am 
on this issue, and it needs to be in place before we take taxpayer 
money and expose it. I use that term because I still think, on the 
first $350 billion, we have the opportunity to be paid back, but it is 
exposed. But for us to further expose an additional $350 billion 
without some strong assurance that we will get repaid this money and, 
most importantly, unless we have some plan that gives us, while not a 
guarantee, a strong indication that accessing that additional $350 
billion will move us toward resolution of this crisis and a loosening 
up of the credit market, I just think is the wrong direction in which 
to go. Because of that, I intend to vote in favor of this motion and in 
opposition to accessing that second $350 billion.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. INHOFE. Madam President, while I was given, very generously, 10 
minutes, I will not take that time because I have had occasion to stand 
on the Senate floor since last October 10 on numerous occasions and 
talk about the way this vote took place in the beginning. Sometimes we 
lose sight of the fact that this had to start somewhere, and this start 
was when Secretary Paulson--and I to have say this is a Republican 
administration; he was the Treasury Secretary--came out with this plan 
on how to save the world. He said: We have to have $700 billion. It has 
to be spent to buy damaged assets. And even at that time, it didn't 
make any sense because, if you read the document, it didn't say 
anything as to what was going to happen to this money. It just 
completely was a blank check. Never in the history of Oklahoma have we 
voted to give anyone, elected or, in this case, unelected bureaucrat, 
$700 billion to do whatever he or she wants to do with it. It is mind-
boggling that that could have happened, but it did happen.
  The other thing that makes history out of this is, this is the 
largest single vote on an authorization in the history of this country. 
This amount is so big, I have tried to explain to people what this 
really means: $700 billion, if you take all of the families in America 
who file tax returns and do the math, is $5,000 a family. That is what 
we are talking about.
  I opposed it originally and said that we are going to regret that we 
did this unprecedented thing. I hate to say it, even though I want to 
encourage as many Members to vote for this resolution, it doesn't make 
that much difference because if it should pass both the House and the 
Senate--and, of course, the House will be voting on it later on--then 
the new President would come in and would veto it. And all he would 
need is 34 votes, in the case of the Senate, to sustain a veto. 
Obviously, the votes are there. So it is going to happen. But I think 
it is important that as many people get on record recognizing it is not 
the right thing to do for America, and to do that, this is their last 
  In October, after this passed the House and the Senate, I introduced 
legislation at that time, then reintroduced it with the new Congress, 
putting in accountability so that they would have to come to Congress. 
I don't care if it is the Bush administration or the Obama 
administration, come to Congress, tell us what they want to spend the 
money on. Let's debate it, go through an appropriations process so we 
are in the curve. That is what the Constitution says we are supposed to 
be able to do. But it didn't happen.
  To name it TARP, the Troubled Asset Relief Program--this is no 
troubled asset relief program. It was represented by Secretary Paulson 
to be the buying of damaged assets. I have renamed it the SOAP program, 
the Spend On Any Program, because that is exactly what we have done. We 
don't know today, and we are about to pass something or we are going to 
end up adopting something, and this resolution will not be able to stop 
it. That is going to change the behavior. It is the first time this has 
happened in the history of this country. We are going to be saying to 
somebody: You can have this big block of money. You can do anything you 
want with it. That has not happened before. I think the historians, 30 
and 40 years from now, will look back and say that the vote that took 
place in October that allowed one unelected bureaucrat to have $700 
billion is going to be probably the most egregious vote in the history 
of this institution.
  I look at this, and I see that this happened. I recall in October, 
when the majority--75 percent of the House and the Senate--voted for 
this thing, I said at that time that there are going to be others lined 
up. As this is structured, you can't stop it. You can't blame the auto 
industry for coming in, wanting to have a bailout. So they got a 
bailout. For those of you who think that is bad, I agree. But that was 
only 2 percent of the total $700 billion.
  So we need to put these things in perspective. This is something that 
should not have happened. I think it is going to go down in history as 
one of the dark moments of this institution.
  Lastly, we have talked to a lot of people, a lot of economists, three 
of them from the Reagan era. They said we didn't really accomplish 
anything with the first $350 billion. Our western farmers in Oklahoma--
I won't mention which bank it is, but it was a bank that initially got 
$20 billion. Now they are asking for more so that credit would be 
loosened up. They came to me way back in October and said they received 
this money, but the credit has not loosened up at all. I am inclined to 
think that the first $350 billion was pretty much wasted, and now we 
are going into another $350 billion.
  I would encourage any of my colleagues who voted for the initial $700 
billion bailout to go ahead and vote for this resolution to stop this 
second $350 billion. That would be a redeeming feature in their 
careers. I would encourage them to do that.

[[Page S569]]

  I will yield the floor.
  Let me inquire of the Chair: There is no one else ready to speak 
right now. If I were to continue to speak, would that use up time on 
this side? I do not want to do that.
  The PRESIDING OFFICER. Yes, it would.
  Mr. INHOFE. OK. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DODD. Madam President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Connecticut is recognized.
  Mr. DODD. Thank you, Madam President.
  In about an hour or so we will be voting on this matter. I know there 
are several other Members who want to be heard on this discussion, 
although there has been a lot said about this matter since the problem 
first emerged, at least the request first emerged, back in mid-
September, September 18 of last year, when the Secretary of the 
Treasury and the Chairman of the Federal Reserve came before the 
leadership of the Congress and announced that within a matter of days 
we would be facing a meltdown of the financial sector of this country 
as well as, maybe, globally. From that time forward, we have found 
ourselves in this situation.
  As I said a little while ago in brief remarks, I do not know of a 
single Member--at least I do not believe there is any--who takes any 
pleasure in being involved in this debate, involved in the vote we are 
about to cast, knowing the problems that have created this situation 
were avoidable, preventable, and had the administration paid more 
attention, when they were asked to more than 2 years ago, about the 
foreclosure crisis in this country--that is the root cause of the 
problems we are now dealing with--then we would not have to be here 
today. That is not hyperbole. That is not speculation. That is a fact. 
But the reality is there was denial after denial after denial: the 
economy was sound and solid, and things were going to be in great shape 
no matter what happened.
  Today, we find ourselves with 17,000 people a day losing their jobs 
in America. Between 9,000 and 10,000 homes are going into foreclosure 
every day in the country. Retirement accounts are being dwindled down 
to almost nothing in too many cases. Costs and other matters are rising 
for many people. We are in the most serious economic shape since the 
Great Depression 80 years ago.
  It is this Senate, this Congress, at this hour, with the transfer of 
power coming at the executive branch in a matter of hours, literally 
yards from where I am speaking today, that will hopefully provide a new 
direction for our Nation. The outgoing President--in a unique moment, I 
suppose, historically--along with the incoming President have jointly 
asked us to step up and provide a tool that might very well do 
something to make a difference in the lives of those 17,000 people 
today who will lose their jobs or maybe one of those families of the 
9,000 today who will lose their home.
  We can say: Look, we are not going to do this. We can flyspeck this: 
I don't like this part; I don't like that part. I would like more 
specificity here and there. We can twiddle our thumbs.
  Well, explain that, if you will, to that person who might lose their 
job, when maybe taking action might make a difference or tell that to a 
family in Connecticut or Minnesota who is going to lose their house 
today: No, we ought to wait a week or two and maybe we will sort this 
out a little better somehow; like somehow the great wizards here, we 
are going to organize this in some fabulous way to serve the interests 
of the people.
  This is a dreadful moment, it is a sad moment, that here in the first 
hours of the 111th Congress, instead of talking about resources that go 
to building bridges and roads or schools, making a difference in the 
health care of people, providing some decent retirement and hope for 
other Americans, we are talking about providing resources to stabilize 
our economy, to get our credit system working again, so you do not find 
the squandering of resources, to see that we might make a difference in 
putting a tourniquet on the hemorrhaging of home foreclosures that is 
occurring from one end of this country to the other.
  Now, it is more dire in some areas than others. Obviously, the States 
of California and Florida particularly are seeing the tremendous 
effects of this situation. Arizona and Nevada are also paying a very 
serious price. But I know in Minnesota, I know in Connecticut, as well, 
while it is not as bad as in some of these other States, it is getting 
worse. There is not an economist anyone has listened to over the last 
number of weeks who has not told us it is not going to get better 
  But what do we do? Again, we have been asked to step up and provide 
some resources here, some serious ones to try to stabilize the credit 
markets, to provide some assistance. I do not know if it is adequate 
enough. This much I can tell you: Like all of us, we have been terribly 
disappointed over the management of the resources that were provided 
back at the end of September, early October. I honestly believe some of 
those resources have actually worked to some degree. But today we had 
about five different witnesses before the Senate Banking Committee--
nominees for various posts, most of them very distinguished 
economists--who have spent years in this field. To a person, everyone 
said, well, they could not predict with absolute certainty that had we 
not acted in September, this economy would be in even worse shape 
  It is always difficult to prove a negative. But it is, obviously, 
easier for those who can stand here and say, well, I told you so or we 
should not have done this because it is impossible to go back and say 
what would have happened with any great certainty had we not acted. I 
think much can be said today when you have an outgoing Republican 
President and administration and an incoming Democratic administration, 
with very different views about how our economy ought to be managed, 
asking us jointly to step up and make this decision. I think it is 
important we listen and we act. That is what I am urging my colleagues 
to do.
  This is not going to win you any parades. You are not going to get a 
plaque or a medal for doing this. I have great respect for my friend 
from Oklahoma, but I would predict just the opposite of what he has 
suggested. I think history will judge us, just as it judged two 
generations ago, what a new Congress did gathered in the winter of 
1933, after the election of 1932, when 5,000 banks closed their doors 
and 27 percent of the American people were out of work. There was no 
hope whatsoever.
  People got together, infused capital into lending institutions--the 
5,000 of them--in the spring of 1933, and creative people sat down and 
worked to try to come up with imaginative ideas to get this country 
moving again, and an American President stood on the east front of this 
Capitol and said to the American people: You have nothing to fear but 
fear itself. Hope began to spring in the hearts and minds of Americans 
all across this country because while they were suffering terribly, 
they knew they needed a Government that was going to roll up its 
sleeves, keep an eye on them, and keep them in mind every single day to 
try to get this country moving again.
  I would say to my colleagues that I believe on next Tuesday, January 
20, the 44th President of the United States will remind the American 
people once again that the only thing we have to fear is fear itself, 
in his own words, and that there is a reason to be hopeful and 
optimistic. This is a great country, with great resources, talented, 
bright, energetic Americans, who want to see our country get back on 
its feet again. But you need to have the tools to do it. You cannot 
wish it well. You have to provide the resources in order to make it 
possible for us to get moving again. That is what this President has 
asked for--both the outgoing and incoming one--to give this incoming 
President the tools necessary to move forward.
  Now, I know, as well, there is going to be far better accountability, 
far more transparency. Foreclosure mitigation is going to be a part of 
this effort. In fact, in a letter from Larry Summers to the majority 
leader--which I ask unanimous consent,

[[Page S570]]

Madam President, to be printed in the Record provides far greater 
specificity than earlier communications, and I welcome that, detailing 
specifically how this will work, how it will be monitored, how 
important the intervention on foreclosures will be, and focusing on the 
flow of credit, which is, obviously, critical if we are going to get 
back on our feet again.
  I think the letter ought to provide some confidence to Members who 
are concerned about how this program will be managed and run, and that 
it will, in fact, be run differently than the present administration is 
doing it.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                            The Office of the President-Elect,

                                 Washington, DC, January 15, 2009.
     Hon. Harry Reid,
     Majority Leader,
     U.S. Senate.
       Dear Leader Reid: Thank you for the extraordinary efforts 
     you have made this week to work with President-Elect Obama in 
     implementing the Emergency Economic Stabilization Act of 
     2008. In addition to the commitments I made in my letter of 
     January 12, 2009, the President-Elect asked me to respond to 
     a number of valuable recommendations made by members of the 
     House and Senate as well as the Congressional Oversight 
     Panel. We completely agree that this program must promote the 
     stability of the financial system and increase lending, 
     preserve home ownership, promote jobs and economic recovery, 
     safeguard taxpayer interests, and have the maximum degree of 
     accountability and transparency possible.
       As part of that approach, no substantial new investments 
     will be made under this program unless President-elect Obama 
     has reviewed the recommendation and agreed that it should 
     proceed. If the President-elect concludes that a substantial 
     new commitment of funds is necessary to forestall a serious 
     economic dislocation, he will certify that decision to 
     Congress before any final action is taken.
       As the Obama Administration carries out the Emergency 
     Economic Stabilization Act, our actions will reflect the 
     Act's original purpose of preventing systemic consequences in 
     the financial and housing markets. The incoming Obama 
     Administration has no intention of using any funds to 
     implement an industrial policy.
       The Obama Administration will commit substantial resources 
     of fifty to one hundred billion to a sweeping effort to 
     address the foreclosure crisis. We will implement smart, 
     aggressive policies to reduce the number of preventable 
     foreclosures by helping to reduce mortgage payments for 
     economically stressed but responsible homeowners, while also 
     reforming our bankruptcy laws and strengthening existing 
     housing initiatives like Hope for Homeowners. Banks receiving 
     support under the Emergency Economic Stabilization Act will 
     be required to implement mortgage foreclosure mitigation 
     programs. In addition to this action, the Federal Reserve has 
     announced a $500B program of support, which is already having 
     a significant beneficial impact in reducing the cost of new 
     conforming mortgages. Together these efforts will constitute 
     a major effort to address this critical problem.
       In addition to these commitments, I would like to summarize 
     some of the additional reforms we will be implementing.
       1. Provide a Clear and Transparent Explanation for 
       For each investment, the Treasury will make public the 
     amount of assistance provided, the value of the investment, 
     the quantity and strike price of warrants received, and the 
     schedule of required payments to the government.
       For each investment, the Treasury will report on the terms 
     or pricing of that investment compared to recent market 
       The above information will be posted as quickly as possible 
     on the Treasury's website so that the American people readily 
     can monitor the status of each investment.
       2. Measure, Monitor and Track the Impact on Lending:
       As a condition of federal assistance, healthy banks without 
     major capital shortfalls will increase lending above baseline 
       The Treasury will require detailed and timely information 
     from recipients of government investments on their lending 
     patterns broken down by category. Public companies will 
     report this information quarterly in conjunction with the 
     release of their 10Q reports.
       The Treasury will report quarterly on overall lending 
     activity and on the terms and availability of credit in the 
       3. Impose Clear Conditions on Firms Receiving Government 
       Require that executive compensation above a specified 
     threshold amount be paid in restricted stock or similar form 
     that cannot be liquidated or sold until the government has 
     been repaid.
       Prevent shareholders from being unduly rewarded at taxpayer 
     expense. Payment of dividends by firms receiving support must 
     be approved by their primary federal regulator. For firms 
     receiving exceptional assistance, quarterly dividend payments 
     will be restricted to $0.01 until the government has been 
       Preclude use of government funds to purchase healthy firms 
     rather than to boost lending.
       Ensure terms of investments are appropriately designed to 
     promote early repayment and to encourage private capital to 
     replace public investments as soon as economic conditions 
     permit. Public assistance to the financial system will be 
     temporary, not permanent.
       4. Focus Support on Increasing the Flow of Credit:
       The President will certify to Congress that any substantial 
     new initiative under this program will contribute to 
     forestalling a significant economic dislocation.
       Implement a sweeping foreclosure mitigation plan for 
     responsible families including helping to reduce mortgage 
     payment for economically stressed but responsible homeowners, 
     reforming our bankruptcy laws, and strengthening existing 
     housing initiatives like Hope for Homeowners.
       Undertake special efforts to restart lending to the small 
     businesses responsible for over two-thirds of recent job 
       Ensure the soundness of community banks throughout the 
       Limit assistance under the EESA to financial institutions 
     eligible under that Act. Firms in the auto industry, which 
     were provided assistance under the EESA, will only receive 
     additional assistance in the context of a comprehensive 
     restructuring designed to achieve long-term viability.
       The incoming Obama Administration is committed to these 
     undertakings. With these safeguards, it should be possible to 
     improve the effectiveness of our financial stabilization 
     efforts. As I stressed in my letter the other day, we must 
     act with urgency to stabilize and repair the financial system 
     and maintain the flow of credit to families and businesses to 
     restore economic growth. While progress will take time, we 
     are confident that, working closely with the Congress, we can 
     secure America's future.

                                          Lawrence H. Summers,

                                        National Economic Council.

  Mr. DODD. So this is a tough vote to cast, as it was in September, in 
October. I listened that night as the majority leader asked every 
single Member to vote from their desk, something we do not do with 
great frequency. I listened to several of our colleagues who are no 
longer here, and I suspect that vote they cast in favor of that program 
had something to do with the outcome of their elections. I am sorry 
that happened to them, and it may have happened because of that vote.
  But we are Senators. This is not a place just to come and give 
speeches. We happen to be here at one of the most critical times in our 
Nation's history. There are wars raging around the globe, and people 
are suffering at home. We have an obligation to them, and sometimes the 
decisions we make are not always the most popular ones in the moment 
they are given. We have learned that throughout history, too, that the 
Congresses in the past that have come before us, that have had the 
courage to stand up and face the realities of their day, have enjoyed 
the good judgement of history because they had the intestinal fortitude 
to do so.
  There is not a single one of us in this Chamber who knows what is the 
right political vote. We all know we can gain favor overnight by 
casting a vote against this bill. My hope is there will be at least 50 
of us who will stand up and cast a better vote--for your children and 
your grandchildren who will not know the outcome of your vote because 
they probably are not alive yet or could not read it. But someday they 
are going to look back and ask what we did at this critical time to 
make a difference in our Nation.
  I believe we are in such a moment, we are in such a time. And it is 
not just this moment; there will be a series of them in the coming 
weeks and months. That is why you sought this office, I presume, to be 
a part of making history and making a difference.
  I would urge my colleagues, no one is arguing perfection at all. No 
one can speak with any certainty at all about the outcome of all of 
this. We are actually in uncharted waters when it comes to these 
issues. But to sit back and do nothing--to do nothing--would be an 
indictment and a failure of responsibility.
  So I am determined, as I know my colleagues will be, if this, in 
fact, goes forward, to monitor it, to insist upon accountability, to 
demand that we see lenders do what they should be doing, insisting that 
the leaders of these institutions not gouge or hoard and do

[[Page S571]]

everything possible to make sure our economy gets moving in the right 
  On that note, Madam President, I urge my colleagues to reject this 
motion of disapproval and to give this new, young American President a 
chance to get our country back on its feet again, as he desperately 
wants to do, and to give America, once again, that sense of hope and 
optimism we deserve as a people.
  Madam President, I yield the floor.
  I suggest the absence of a quorum and ask unanimous consent that the 
time in the quorum call be jointly charged to both sides.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mrs. BOXER. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. BOXER. The Presiding Officer and I have discussed this issue 
that is on the floor before us now, the next tranche of funds for the 
TARP program. All one has to do is listen to what TARP stands for: 
Toxic Assets--T-A--and your first instinct is: I don't want to go near 
it; I don't want to touch it; I don't want to have anything to do with 
it. I can tell my colleagues from the bottom of my heart that on 99 
percent of issues here, I know what I am going to do pretty much 
immediately, because it is a clear path for me. I find it not that 
difficult to make that decision. However, the first vote we had on TARP 
after a phone call with Secretary Paulson and Ben Bernanke where they 
said: Our system is on the verge of economic collapse and if we don't 
get them the 700-plus billion dollars, our Nation would face economic 
ruin--I remember I was on that phone call with about 30 other Senators, 
and we were asked for a blank check by Henry Paulson. He wanted 700-
plus billion dollars, he wanted it then, that minute, that second. He 
wanted no strings. He didn't want to tell the bankers they couldn't 
take a bonus payment. He didn't want to tell them executive pay had to 
be reasonable. He didn't want to tell them they would have to lend. He 
didn't want to use it for housing. It was a horrible conversation. We 
said: You are not getting a blank check and we are not going to do this 
until we put some strings on this.
  Well, we put a few strings on it. We set up a commission to oversee 
it. I wish to say that Mr. Paulson, in my view, did not live up to the 
spirit of what this Senate and this Congress wanted him to live up to. 
What they did was not transparent. What they did did not ease the 
credit crisis. What they did was to kind of ignore the problem of the 
housing crisis which got us into this mess in the first place.
  So let me be clear. Let me be clear to my constituents. If Henry 
Paulson was going to get this money, this second tranche of money, if 
the Bush administration was going to continue to dole out this money, I 
wouldn't give them $3, let alone $350 billion. I wouldn't give them 30 
cents. I wouldn't give them 3 cents. However, I have to say to all of 
those within the sound of my voice, as someone who wound up voting for 
the first tranche and feeling badly about it ever since: When 
President-elect Obama tells us that it would be irresponsible for him, 
in the face of this worst crisis since the Great Depression, to not 
have the ability to tap into these funds; when he tells us that he is 
fearful that there could be a great crisis, that there could be an 
emergency; when he asks us to trust him on this and put our confidence 
in him and that he is going to use these funds in a different way, he 
is going to use these funds to address the housing crisis, and that he 
is going to be transparent; and to quote him, ``Every penny that they 
spend, the public will know about,'' I have a choice. I have a choice. 
I can say: Sorry, it was a horrible experience the first time and I am 
not going to give you this chance. I could say that. That is the easy 
thing. That is the easy vote. Voting no is the easy vote. Then I can go 
home and not worry about it. But how could I walk away from this 
President at this time? When he says to me and he says to us he needs a 
chance here, he needs this tool in his pocket to bring it out if he is 
in a crisis worse than the one now, I cannot walk away from that.
  So I say to my constituents I will vote for this, and I will do it 
because of the assurances I have gotten from the President-elect 
himself that it will be different, that he will use these funds 
judiciously, that he needs to make sure he has this tool in his pocket. 
I hope my constituents understand that after hearing that from this 
President, who got more than 60 percent of the vote in my State, that I 
feel he deserves my trust at this time.
  I thank the Chair and I thank Senator Dodd.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from South Carolina is recognized.
  Mr. DeMINT. Madam President, a number of us--many Americans--are 
disappointed that the first act of this new Congress and this new 
President will be to add $350 billion more borrowing on the backs of 
our children and grandchildren. Madam President, $350 billion will be 
in addition to another $350 billion that we approved last year, as well 
as the nearly $1 trillion we are talking about in stimulus that will be 
coming up next year. This is not the change that many Americans had 
hoped for as we enter a new administration. Many of us are very 
disappointed in how the first round of troubled assets funds have been 
  It is clear that the intention of the incoming President and the new 
Democratic majority in Congress is to spend and borrow our way out of 
this recession. That doesn't work for families. It is not going to work 
for our country. More spending and borrowing and printing money may 
help Washington to grow and prosper, but it is certainly not going to 
help American families and businesses grow and prosper.
  In this context that we are here today talking about this $350 
billion in spending, with all respect to my colleague who just spoke, 
the easy thing to do is vote for more spending here in Washington. We 
find it is almost impossible to get people to vote for any cuts in 
spending. Yet, in spite of our calls for economic relief in an economic 
meltdown situation, Congress refuses to make any sacrifices on what we 
do here.
  I am speaking to support this resolution of disapproval that has been 
offered by Senator Vitter, and I encourage all of my colleagues to take 
this responsible step to slow down this avalanche of spending and debt 
in our country.
  Some are trying to make us feel a little better about this incredible 
amount of spending by saying: It is not real spending; the government 
is actually investing in debt of companies and intervening in companies 
and that we could get some of this money back. Frankly, it doesn't make 
me feel any better to know that this government is intervening in the 
private sector and every place it touches, it is going to bring new 
rules and regulations and make our economy less likely to operate as it 
  As we know, many who voted for this TARP bill last October now regret 
they did it. I didn't vote for it, but many who have, have issued press 
releases and spoken on this floor being very critical of how it was 
used and the fact that it hasn't worked. The promises that were made of 
how this money was going to be used were changed within a couple of 
weeks of the time the panic was issued here in Washington, and everyone 
was told they needed to vote for it or there would be worldwide 
economic calamity. Yet, almost before the ink was dry, they changed 
what they were going to do on the bill. I think for that reason, many 
do not trust this whole process of creating a slush fund for an 
administration, whether it be Republican or Democrat, to spend $700 
  We know what happened last fall. In October there was a crisis 
mentality. We were told we had to act immediately. Since then, in spite 
of all of the promises, the stock market has fallen nearly 25 percent 
and we are in the same credit problem situation that we had then. It is 
too much money to be throwing at the wall in hopes that it might work. 
I still hear at home that all of this money we put into the system has 
not worked its way into small business loans or loans for individuals, 
loans to buy cars, and we have no assurance at this point that an 
additional $350 billion will do that.
  I would encourage all of my colleagues to look at where we are as a

[[Page S572]]

Nation and the amount of debt we have. The amount of debt we have is 
now approaching a half a million dollars for every American family. It 
is very difficult to justify continuing to borrow money when all we are 
doing is treating the symptoms of the problem.
  It is amazing to me that we are talking about throwing more money at 
a problem and we have yet to address the causes of the problem. We know 
the government made many mistakes with government-sponsored entities 
such as Fannie Mae and Freddie Mac. We have not corrected those 
problems in a way that will show any results. We know we require banks 
to make loans to people who can't afford to pay them back and we have 
not corrected those problems. If you talk to any businessman--and I 
have been a businessman most of my life--they are not looking for a 
short-term, knee-jerk solution; they need to have a predictable 
business environment in order to take risks and make investments and 
grow their business.
  If we were looking at real solutions such as lowering our corporate 
tax rate, lowering capital gains that would encourage the nearly $11 
trillion of private money that is now sitting on the sidelines--we are 
not talking about doing anything that is going to encourage this 
private money to get into the market, into the banking system that 
would create more liquidity. All we are doing is treating the symptoms, 
and there is no discussion of solving the problem.

  I hope my colleagues will take the telephone calls and the e-mails 
they are getting from their constituents, as I am, seriously. Americans 
intuitively know that what we are doing here is wrong. Even if it 
worked for a few months, all of us know we have to pay it back, our 
children and our grandchildren for generations to come, with a lower 
standard of living, incredibly high taxes, and a devalued currency.
  Madam President, I thank you for the opportunity to speak and I yield 
my time, as I again encourage my colleagues to vote for this resolution 
of disapproval, and let's figure out how to solve the real problem.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. KYL. Madam President, I intend to vote against the resolution 
disapproving the release of the so-called second tranche of funds for 
the troubled asset relief program, or TARP, albeit with some 
  When I first decided to support the TARP last fall, I did so because 
I believed it was essential to preventing the collapse of our financial 
markets. I believed we were facing an emergency that would hurt every 
American unless Congress stepped in to provide temporary assistance to 
our financial system. I continue to believe this today. The conditions 
that called for the first one-half of the $700 billion authorized still 
exist today.
  Last fall, credit stopped flowing. The root of the problem, and I 
think we all agree, is that the banks didn't know if their mortgage-
backed securities had value. No one was willing to loan based upon that 
lack of knowledge. When they stopped lending to each other, they also 
stopped lending to businesses, large and small, and to ordinary 
Americans. People couldn't even get a loan for a car or a major 
appliance, and that condition persists throughout the country today to 
some degree. We learned very quickly that the dubious business model of 
Fannie Mae and Freddie Mac to securitize more and more mortgages was 
causing the entire system of credit and financing to seize up. Every 
American has been hurt by this market failure.
  So the Secretary of the Treasury recommended that a $700 billion 
investment program that was flexible enough to change with market 
conditions and that would be focused on addressing the underlying 
problem in our financial market, namely, these mortgage-backed 
securities and the Treasury has deployed or committed the first half of 
the money--$350 billion--and is now asking for the second half. 
Unfortunately, as I said, the same circumstances that called for the 
initial $350 billion I believe pertain today.
  For the most part, I have supported the Treasury's actions, although 
I wish that the conditions enabled the banks to be more aggressive in 
their lending. I don't view the program as a gift to the banking 
industry because the funds must be paid back with interest.
  I did not and do not support their decision to use TARP funds to bail 
out the automobile industry, a purpose for which it was clearly not 
intended. I wish to make it clear, I always understood and believe that 
the full $700 billion would likely be needed to get our credit markets 
working again. That is why I support giving the Treasury Department the 
authorization for this second tranche of $350 billion, and it is why I 
will vote against the resolution to disapprove releasing the funds.
  I have had many conversations with officials of the incoming Obama 
administration, and they promised me and all Republicans, for that 
matter, that they intend to dedicate the fund to shoring up the 
financial markets. They promised they will not use the funds to prop up 
failing companies outside of the remaining commitment to the automobile 
industry made by the Bush administration, my understanding about $4 
billion, and the possibility of debtor possession financing under 
certain circumstances.
  They promised greater transparency and accountability, and I intend 
to stay in close contact with them to see that these commitments are 
kept. I know this is not a popular decision, but I believe, in the long 
run, this program will help to keep our economy from collapsing. It 
will eventually help it to recover, and that will benefit every 
Arizonan and every American.
  I wish to be clear that I am not asking any of my colleagues to join 
with me on this vote unless they have concluded, as I have, that we 
simply did not take a chance that we don't have the financial ability 
to deal with crises as they develop.
  It is, unfortunately, my view that crises will continue to develop in 
the finance and banking sector of our economy so we are going to need 
the authority for the next $350 billion.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. HARKIN. Madam President, I ask unanimous consent for 3 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HARKIN. Madam President, I wish to make it clear from the 
beginning that no vote--well, there have been a few votes I have cast 
in my 24 years, now going on 25 years, that I have regretted. We are 
all human. We make mistakes. We try to get the best information we can, 
and then we vote.
  Last fall, the information we got is we were on the verge of 
collapse, we had to do something, we had to get this TARP bill through, 
so I voted for it.
  Then I became more and more dismayed as the weeks went by and the 
months now to see how it was mishandled completely, not in accordance 
with what we in Congress were told they were going to do. They said 
they were going to purchase toxic assets. But then Secretary Paulson 
and his friends did the old bait and switch. Instead of doing that, 
they pumped tens of billions of dollars into purchasing equity in major 
  I said many times it is sort of like Secretary Paulson and his 
buddies doing all for whom I call the graduates of Goldman Sachs, sort 
of taking care of their buddies and bailing out their buddies in the 
banking industry.
  So when this new TARP came up, I must tell you I was adamantly 
opposed: no more of this, we are not going to put any more money out 
there like this. Then I began discussions with the new administration 
coming in. They have come up and talked with us a number of times. I 
had about three phone calls last night with my good friend, Senator Joe 
Biden, who will be our next Vice President.
  He said: What is troubling you?
  I said: What is troubling me is that no one seems to be responsible 
for what happened to the first 350. You have Paulson, but then there is 
President Bush, and somebody else seems to be responsible.
  I said: Secondly, they didn't use the money for what we wanted and 
there is no transparency. We don't know what happened to a lot of it. 
And I said: Third, there has to be more of this money put out there for 
middle-class America. It has to be put out there for them--not this 
trickle down where you put it in investment banks--but put it down 
below so it can percolate up. He talked with the President-elect. We 
had three phone calls last evening.
  I see a letter from Lawrence Summers was sent up to us today which 
reiterates what soon-to-be Vice President

[[Page S573]]

Biden said to me last night. First, no substantial amount of money will 
go out of this fund unless it is signed off by President Barack Obama. 
He has to sign off on it. So we know where the buck stops.
  Second, the way the system is set up, Vice President Joe Biden will 
be in there, he will be a part of this process, and the President will 
rely on him for his input into this process. I know Joe Biden. There 
has never been a stronger fighter for middle-class America and for 
working families than Joe Biden. So that reassures me we have another 
source of input into this effort.
  And third, they are going to make it absolutely transparent and put 
it out for everyone to see where they are going.
  Again, there were a couple of other things they agreed to do. No. 1, 
executive compensation cannot go above a certain threshold until the 
Government has been repaid. That is good.
  No. 2, shareholders will not be rewarded until the Government has 
been repaid. For firms receiving exceptional assistance, quarterly 
dividend payments will be restricted to 1 penny per quarter until the 
taxpayers are repaid. That is pretty darn reassuring to me.
  And now this: preclude the use of Government funds to purchase 
healthy firms rather than to boost lending. That is exactly what 
happened with the last 350.
  I find myself now in a position of saying: Look, we still have 
problems out there, we have credit problems out there. We didn't answer 
these problems. We have a new team. Barack Obama--and I served with him 
in the Senate as all of us have--said time and time again--and I know 
where he is coming from--that we have to help middle-class America, 
that we can't just put the money in at the top anymore. Joe Biden has 
said the same things.
  With these assurances that there is a new team down there, now I am 
going to be able to support the release of the next $350 billion.
  I close with this: I felt a little bit, after the last one, like 
Charlie Brown and Lucy--she is always pulling the football out from 
under Charlie Brown. I said: That is not going to happen to me again. 
Well, Lucy is not holding the ball now. We have someone new holding 
that ball, someone by the name of Barack Obama and Joe Biden and their 
  I am going to put my trust in them based on this letter that has been 
sent up, which I understand was made part of the Record earlier today. 
With those assurances that we can get that money out, down to 
homeowners, to help on foreclosures, to help out some of our smaller 
banks with their credit problems, I see my way clear now to vote to 
make sure we get this money released for the new administration.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Alabama is recognized.
  Mr. SHELBY. Madam President, I rise to support the joint resolution 
of disapproval which would prevent, as you know, the allocation of 
another $350 billion to the Treasury's flawed Troubled Asset Relief 
  The Treasury Department's implementation of TARP has been a 
bureaucratic fiasco. In the years to come, I believe it will be 
considered a textbook case in our business schools on how not to 
conduct fiscal policy.
  The Treasury Department has never had a clear plan on how to respond 
to the financial crisis or how TARP funds could best be utilized. It 
told Congress just a few months ago that it would spend TARP funds one 
way and then spent them another. Rather than establish a clear plan and 
then use TARP funds to implement it, Treasury has recklessly used TARP 
funds to bail out big Wall Street firms threatened with bankruptcy.
  TARP has proven to be helpful for rescuing Wall Street bondholders 
but has done little for the U.S. economy, small business, and average 
  Treasury's approach to TARP has been so undisciplined that its 
commitments already exceed the $350 billion Congress authorized it to 
  Further evidence of the erratic implementation of TARP is the fact 
that Treasury has even failed to comply with the statutory requirements 
for requesting the additional $350 billion in TARP funds. The statute 
clearly requires the Treasury Secretary to provide Congress with a 
detailed plan on how it will spend the additional funds. There is no 
plan. There is nothing to review. There is no way we can say to the 
American people this afternoon that we have conducted in the Senate a 
thoughtful, thorough examination of how this money is going to be spent 
because there is, quite literally, nothing to examine.
  If Congress cannot hold Treasury accountable for providing a simple 
plan on how it will use an additional $350 billion, why should the 
American people today have any confidence Congress can hold Treasury 
accountable on how it will spend it?
  As you know, I opposed the original TARP legislation because I did 
not believe the TARP program was based on a well-thought-out plan. 
During our consideration of that legislation in the Senate, I pointed 
out to some of my colleagues some clear and serious problems with 
purchasing troubled assets as Treasury proposed to do at that time.
  The Treasury Department assured us--assured us--told us unequivocally 
it could address the financial crisis by establishing TARP to purchase 
troubled assets from banks using a reverse mortgage auction.
  Is that what the initial $350 billion was used for? The answer is no. 
After further examination, the Treasury Secretary decided that 
purchasing troubled assets was not a feasible plan.
  It is now clear the Secretary of the Treasury did not have a real 
plan when he proposed TARP. Rather, he had a hastily conceived notion 
that, it turned out, was impossible to implement. Because there was so 
little thought put into the original plan, we have spent $350 billion 
and the TARP has failed to stem the economic downturn and hundreds of 
thousands of people have lost their jobs.
  We should not, this afternoon, repeat our mistake--but we will--by 
granting the Treasury the additional $350 billion without first 
determining how to best use those funds.
  I think it is time the Congress stop and think and take the time to 
devise an effective solution. First, we should demand that the Treasury 
Secretary provide a plan on how the $350 billion will be used. That is 
the least we can do. This is already required, as I said, under the 
TARP legislation, which directs the Secretary to submit ``a written 
report detailing the plan of the Secretary.''
  What the Secretary has submitted is not only legally insufficient, it 
is completely devoid of substance. This should not be acceptable to the 
  Second, the Banking Committee should hold extensive hearings on TARP 
and alternative ways of addressing our financial problems. It should 
also hold hearings on how previously committed TARP funds have been 
spent, who benefited, who is accountable. The Treasury Secretary, 
whoever it may be, should appear before Congress and tell us exactly 
how he wants to use the funds. This is especially important now that a 
new administration will be responsible for spending it.
  Madam President, $350 billion is an enormous amount of money to me. I 
find it hard to believe we would even consider granting any public 
official the authority to spend such an amount without, at the very 
least, requiring him to appear before us and explain how he will use 
it. If the majority and the new administration wish to demonstrate that 
there is a new climate of accountability in Washington, this would be 
an opportune place to start.
  I believe the choice is clear. If you support accountability, 
transparency, the only vote is to support the joint resolution to deny 
the $350 billion to the Treasury.
  The American people, I believe, are rightly outraged at the way 
Congress and the Treasury have recklessly spent billions of TARP 
dollars. It is time Congress looks at the financial crisis with the 
seriousness and diligence the American people demand, expect, and 
  The last time we considered how to respond to the financial crisis, 
we panicked and passed the TARP bill. We now have a second chance--
though I believe we will throw it away--to fulfill our responsibilities 
to the American people. I hope we will support the motion to 
disapprove. I urge my colleagues to vote in favor of the joint 
resolution of disapproval.
  I yield the floor.

[[Page S574]]

  Mrs. MURRAY. Madam President, next week, we will inaugurate a new 
Commander in Chief. It is a time of hope and opportunity for people 
across this country.
  While many Americans are hopeful today, too many of them are hurting, 
and they cannot wait another day for the change they have been 
promised. People in my home State of Washington are feeling the pain.
  When I held an economic roundtable in Everett, WA, earlier in 
December, the room was filled to overflowing with people who came out 
in the middle of the day to express their concerns and to listen to 
business owners and families and community members talk about the 
struggles they are facing.
  Unemployment in my State, like States across the country, is at 
record highs. Businesses, big and small, are struggling to meet their 
payroll. And too many families are still wondering how they are going 
to stay in their homes or get a loan to pay for school for their kids.
  We stood here on this floor almost 3 months ago debating whether to 
approve the President's request for economic rescue funds. At that 
time, communities across my State were hurting. Families were 
struggling to pay for their groceries, to afford health care, and 
wondering how they were going to pay for college.
  My constituents were angry they were being asked to fork over their 
tax dollars to cover the consequences of years of reckless abandon on 
Wall Street and the failure of this administration to regulate or rein 
in their folly.
  Here we are today, 3 months later, and my communities and my families 
are still hurting. Many people are still struggling with health care 
and education and foreclosures. Just this week, the people of my State 
heard Boeing announce plans to lay off thousands of workers in the 
State of Washington. The Seattle PI--a newspaper that thousands have 
welcomed into their homes every day--was put up for sale. And today we 
learn that foreclosures in our most populated county have spiked by 88 
percent over last year.
  My constituents live 2,500 miles away from here, and they are 
listening to our debate here today. They are asking why on Earth 
Congress would approve billions of dollars more after the way the last 
chunk was handled.
  The rescue funds we approved in October prevented economic collapse, 
but regular people are still struggling. They say they have not felt 
the impact of these funds on their job security, on their incomes, or 
their ability to stay in their homes.
  I have to say, I understand their frustration, and I share their 
concerns. I am angry too. I am angry about the lack of transparency 
into how banks are using these dollars. I, in fact, picked up the phone 
and called Secretary Paulson to express my outrage when I read stories 
of those lavish parties held by companies that received our precious 
rescue dollars.
  There has not been enough accountability or transparency to date. 
That must change. There has not been enough benefit to regular families 
and small business owners and homeowners. That must change. When I 
voted in favor of these funds in October, I said it was not a cure-all 
but an attempt to keep an already very bad situation from getting much 
  It takes both investment and honesty to get our economy back on 
track. Unfortunately, we have not had much of either. The disbursement 
of these funds was the current administration's entire plan to improve 
the economy. But their philosophy was like using a Band-Aid when the 
economy needed surgery.
  The administration will change next week, but the challenges facing 
our Nation will not. I spoke with President-elect Obama earlier this 
week, and I expressed my concerns about how the economic rescue funds 
had been used up to this point. He agreed.
  Today, I met with Timothy Geithner, the President-elect's nominee to 
head the Treasury Department. He gave me his assurances that 
transparency and accountability will be improved and that there will be 
more done to help responsible homeowners avoid foreclosure.
  With those assurances, I believe the American people are finally 
going to get the investment and the honesty they deserve. President-
elect Obama is inheriting an economic crisis. That is a very tough 
place to start. But he told me, in order to move ahead and focus on 
America's families and businesses, we have to ensure the stability of 
our financial markets. The President-elect has assured me that while he 
believes these funds are important, they are only one part of his plan 
to get America back on track.
  So I said yes to those funds today because I believe we can move 
forward, and I want our new President to have the ability to focus on 
our economic recovery. The President-elect and Members of Congress are 
committed to ensuring a full and accurate accounting of how the 
Treasury Department has allocated the funds spent to date and going 
forward, and we will ensure that assistance does not just flow to large 
financial institutions, but will be available to our community banks 
and small businesses as well. We will take a hard look at the factors 
that brought us to this point and address them.
  Our new President has promised to work with Congress to pass and 
implement new regulatory measures to better protect consumers and 
businesses and investors and to ensure that our taxpayers are never 
again put in this terrible position. We will work with this new 
administration to quickly implement aggressive policies to reduce 
preventable foreclosures for responsible homeowners.
  This crisis started in the housing market, and we will not dig 
ourselves out without overhauling the system. I will not be done with 
this process until Americans who have lost their jobs and their homes 
are back on their feet.
  People of my State know what it will take to get America working 
again, and so do I. We have to value our workforce and find a way to 
make health care affordable and accessible. We have to invest in 
research and development and reward American innovation. We have to 
implement a smart forward-looking energy policy that ends our addiction 
to foreign oil once and for all. We have to invest in our roads and our 
bridges and our highways and the projects that will pave the way for 
further economic growth. We have to recognize that education is a 
priority. We cannot fill those great jobs of the future without an 
educated and skilled workforce.
  It is time to put America's families first. It is time to restore 
their faith that government works for, not against, them. Americans who 
are hurting today will not see a change overnight. There is a long, 
hard path ahead of us, but the American dream of owning a home or 
running a business or going to college is still alive in communities 
across this country. To pull back now and allow our credit markets to 
freeze would tie the hands of an incoming administration with plans to 
invest in America again and potentially cause lasting economic harm.
  This is just one step in the process. We will provide these rescue 
funds to stabilize our financial markets, but we will also implement 
strict regulatory reforms and pass an economic recovery package that 
invests in our communities and puts Americans back to work.
  I grew up in a country that was there for my family in very hard 
times. When my father got sick and could no longer work while raising 
seven kids, there were Pell grants and student loans and food stamps 
when my family needed them. I will always remember that. That is why I 
will always work to make sure our country is there now for today's 
American families.
  I supported this rescue package today because we have to keep our 
country moving forward, and our incoming President deserves the support 
of Congress to make that happen.
  Thank you, Madam President. I yield the floor.
  The PRESIDING OFFICER. The Senator from Georgia is recognized.
  Mr. ISAKSON. Madam President, to a certain extent I wish to follow up 
precisely on the remarks the Senator from Washington made at the end of 
her speech.
  I, too, have been disappointed with the deployment of the first half 
of the TARP money, and I supported that deployment in the hopes that it 
would stabilize the marketplace, ease credit for our customers, and 
help the housing market. While it probably did stabilize the banking 
system, there has yet to be a loosening of credit and

[[Page S575]]

there has yet to be a recovery of the housing market.
  Looking ahead, we continue to look at suggestions that throw money at 
the problem rather than getting to the root cause of the problem. In 
fact, with the best of intentions, I think people are struggling to 
meet the symptoms of a serious illness rather than treat the illness. I 
wish to direct my remarks tonight to that illness.
  The illness, as the Senator from Washington referred to, is the 
collapse of the U.S. housing market which began in the last quarter of 
2007. In the first quarter of 2008, in January, I introduced a housing 
tax credit of up to $15,000 for the purchase of any house that was 
standing vacant or in foreclosure. I did it for a couple of reasons. 
No. 1, I was in the real estate business for 33 years, and I was in it 
in 1974, a year in which we had a housing collapse worse than the 
current situation. While many people think this one is bad, it is not 
as bad as 1974.
  In December of 1974, there was a 3-year supply of unsold, standing 
new houses in the United States of America. That is a catastrophic 
inventory. We currently have a supply of about 11 to 13 months, 
depending on the State. That is not a good market, but it is not 36 
months, which is a horrible market.
  President Gerald Ford, a Republican, and a Democratic Congress, came 
together and passed a $2,000 tax credit to any family who bought and 
occupied one of those standing homes. Within 1 year's time, which was 
the limited time of the tax credit, two-thirds of the housing inventory 
on the market was sold, values stopped declining and started improving, 
and we had a stabilization of our economy, the end of a recessionary 
period, and the beginning of prosperity.
  I come here tonight because about an hour and a half ago I dropped a 
bill known as Fix Housing First, an effort for me and others in this 
body to rekindle that debate of last January. Now, last year, we did 
pass a housing tax credit, but it was a now-you-see-it/now-you-don't 
approach. It was a first-time home buyer credit of $7,500 that was a 
refundable loan, interest free, because over 15 years you would pay the 
credit back to the Government in the form of income taxes. It was an 
incentive, but it was weak. It was not bold.
  The tax credit we introduced last year was scored by CBO at $11.4 
billion, and Finance believed at that time--and maybe rightfully so--
that was too big a price to pay and too expensive. Well, because we 
didn't do it, in October of this year, we approved $750 billion to 
address the symptoms of the problem, which is the failure of the 
housing market.
  I had the privilege yesterday of meeting with some of President-elect 
Obama's team, including Rahm Emanuel, Dr. Summers, and others, and told 
them precisely what I am saying on the floor of the Senate today; that 
is, I hope they will embrace this concept of incentivizing the housing 
market so we can stabilize values, stop the continuing erosion of 
equity, and begin to reflate--not inflate but reflate--the housing 
  In America today, 20 percent of the houses are underwater, meaning 
there is more owed on them than they are worth. That means equity lines 
of credit with our banks are in default. It means students going to 
college are losing the money their parents had for tuition. It means 
there is not enough liquidity in households anymore or credit 
availability to make purchases of durable goods that are important to 
our system, and our system is continuing to feed in a downward spiral 
on the illiquidity, the lack of equity, and the lack of a marketplace 
for housing.
  I was in this business for a long time, and I called 10 people who 
worked for me a number of years ago last weekend in Atlanta. I asked 
them, I said: What is going on in the market? Tell me what the buyers 
are saying or are there any buyers? I talked to a lady by the name of 
Glennis Beacham.
  She said: Johnny, I had nine people come to my open house last 
weekend, and that is a good crowd for an open house in this 
marketplace. Every one of them had the money and they wanted to buy, 
but they were looking for two things: a short sale, which means 
somebody selling their house for less than is owed on it and getting a 
discount from the lender, which means it is a downward price or they 
are looking for somebody whose house is going into foreclosure that 
they think they can steal. They don't want to even make an offer on the 
80 percent of people's houses in this country who are making their 
payments, aren't in default, aren't in foreclosure, but might need to 
sell. So the marketplace has died.
  Now, Fix Housing First proposes the following: Repeal the $7,500 tax 
credit we passed last year, which is not being used, by the way. That 
credit has not been used to any extent whatsoever. Replace it with a 
tax credit that will go from $10,000 to $22,000 depending on the 
formula. It would be a monetizeable tax credit. What that means is 
this: you make the tax credit good for this year--January 1 through 
December 31 of 2009--but you allow the monetization or the claiming of 
that credit against the 2008 income taxes of that family. The 2008 
income taxes come due in April of this year, the 15th. We all know 
that. By allowing the credit to be taken against 2008 income taxes, you 
can monetize that money at the closing, use it as a part of the 
downpayment, and immediately incentivize the marketplace. Is that a 
little costly? Sure. Is it something we would rather not do? Probably. 
But what are we going to do? Watch the marketplace go down to where 
four out of every five houses are underwater? Watch sales go down to 
where there is no viable housing market in this country? It has not 
stopped spiraling. It is continuing, and everything feeds off of it.
  I don't wish to belabor this point, but I wish to talk for the 
American people, the people of Georgia. The community bankers are 
hamstrung right now. Most of their investments are in real estate, 
residential construction, and acquisition and development loans. With 
no marketplace to buy the lots or buy the houses, they have no cashflow 
coming in to service the loans. They are deteriorating in terms of 
their value. Americans who have been transferred who are making their 
payments, who have a viable house, who have to sell it to move to the 
next city of choice, there is no marketplace to buy that house, so that 
is stagnating.
  Consumer products, take carpets, for example. The State of Georgia, 
the County of Whitfield, the City of Dalton produces about 85 percent 
of the domestic carpet in the United States of America. It is shut 
down. The mills are shut down. Why? People aren't recarpeting. They 
aren't redoing their houses. New houses aren't selling. The market is 
gone. I could go on and on with durable products made in the United 
States of America whose industries are now in trouble because the 
housing market has taken a severe hit over a protracted period of time.
  So my plea to the President-elect, to my friends on both sides of the 
aisle, to the Members of the United States House of Representatives, as 
we are deploying countless billions of dollars to react to problems 
that are manifesting because of a failed housing market and mistakes 
that were made in the past, let's put some money out there to 
incentivize Mr. and Ms. America who want the American dream to buy a 
home, to buy one for their family, occupy it as their residence, and 
give them a tax credit for doing it. It is a small price for the 
Government to pay to begin to restore the industry that got us to where 
we are and will lead us out of these dangerous and dark times.
  So I come tonight on behalf of the homeowners of the Presiding 
Officer's State of Florida and mine, the community bankers, the 
realtors, the homebuilders, the fix-it people, the durable goods 
producers, the building supply makers, the landscapers--every job that 
has been lost and gone, in some cases forever, because the housing 
market in this country has collapsed.
  We have learned our lesson for loose underwriting. We have learned 
our lesson from loaning money to people who weren't qualified to 
borrow. We have paid a terrible price for that lesson, both the country 
and the people. It is time for us to do what we know we should have 
done: have quality underwriting, available credit, but have 
accountability in our lending system, make sure values are appraised 
right, underwriting is done right, and credit is available but people 
are qualified. If we can do that and incentivize people to come back 
because of the tax credit, we can solve this problem.
  I don't want to oversimplify the gravity of the problem we face, but 

[[Page S576]]

housing market led us in; the housing market will lead us out. It is 
time for us to fix housing first. Our failure to do so will cost us a 
lot more than $700 billion of our taxpayers' money, and countless 
Americans who shouldn't will lose their homes, lose their jobs, and 
lose their faith in the greatest country on the face of this Earth.
  I ask my colleagues to study this recommendation. I hope the 
President-elect will embrace it. I hope, quickly, we can fix housing 
first in the United States of America.
  Mr. ENZI. Madam President, for the past 2 weeks, I have been 
patiently waiting for what everyone in this chamber knew was 
inevitable. When the Senate passed the Emergency Economic Stabilization 
Act on October 1, 2008, we included a stipulation allowing the 
disbursement of the final $350 billion only upon the President's 
request to Congress, and after Congress had been given an opportunity 
to pass a resolution of disapproval preventing release of the funds. We 
did this to provide a chance to thoroughly assess the program, make 
changes, and get our country's economy on the right track again.
  Although I voted against the act that created the Troubled Asset 
Relief Program, the TARP, I was pleased that this provision was added 
into the final bill. Many of my colleagues and I thought, 
optimistically, that the TARP would work better than we had predicted. 
It was even possible, some noted, that we would not have to spend the 
entire $350 billion final disbursement. Even if it was necessary to 
approve the additional funds, we would be provided the opportunity to 
evaluate the program and make it more effective in a rapidly changing 
  So in preparation for the President's request, I have been keeping 
track of the market conditions, following the headlines, and watching 
the stock market. Yesterday, the Dow Jones industrial average closed 
down almost 250 points. This is the lowest the market has closed in 
2009, and the biggest drop since December 1, 2008.
  Jobless claims have increased since the holiday slowdown. The U.S. 
Department of Labor statistics on unemployment released today indicate 
that the recession is getting worse and that those companies we were 
trying to save with the TARP program are cutting more workers than 
predicted in order to stay afloat. These are the same workers who have 
seen a lifetime of retirement earnings shrink to nothing. Others have 
lost their homes, their most stable financial asset in past years, due 
to rising unemployment and a frozen credit market. For those Americans 
without a job, they face dismal employment prospects as companies 
continue to cut their workforces to stay in the black.
  The companies that employ them are not in any better shape. Headlines 
this week warned that even the largest financial institutions were 
forced to take drastic measures to remain viable. For example: 
``Citigroup Ready to Shrink Itself by a Third.'' ``Bank of America to 
get Billions in U.S. Aid, Can't close deal for Ailing Merrill Lynch.'' 
These developments occur despite $350 billion of taxpayer money already 
spent, and billions more guaranteed through the Federal Reserve.
  After more than 3 months, it is time we take a detailed look at the 
TARP program and ask ourselves, ``Are American taxpayers getting what 
they paid for?'' Based on my observations, it is clear that we are not. 
Our economy appears to be in no better shape than on October 1, 2008, 
when we passed this massive $700 billion emergency bailout, and today 
the Senate is poised and seemingly eager to send more money out the 
door. We are throwing good money after bad money, and expecting 
different results. But without substantial changes to the TARP and 
measurable, attainable goals, there is no chance of success for this 
  Let's be clear, this program has not worked. America is still in the 
grips of a frozen credit market, and the U.S. Treasury continues to 
operate this program in a manner never intended by the Congress when we 
created the TARP. In fact, upon passage of the act, Treasury gave it a 
different name. The TARP became the Capital Purchase Program and 
instead of buying troubled assets, the Treasury began buying stock 
directly from the market. Yet when Congress has an opportunity to put 
this program back on track, some of my colleagues would prefer to 
simply give Treasury more money to operate a $700 billion slush fund as 
it pleases. This is not the time to encourage blind spending and ignore 
the fundamental problems with our country's capital markets. Now is the 
time to modernize the TARP, add accountability and transparency, and 
hold Treasury to its commitment to operate this program the way we 
  It will take more than blind spending to get our economy back on 
track. That is why I support the resolution of disapproval. My 
colleagues in the Senate must take a critical look at this program, 
measure its progress and setbacks, and make changes that will put this 
money where it is most needed. It is obvious that the first $350 
billion has not worked, so why are we rewarding this failure with more 
money? Instead, let's work on a reform package that will hold 
Treasury's feet to the fire and get credit flowing through our markets 
again. We need a program that will put our money to work building 
construction projects, hiring employees, and operating small and large 
businesses across the country. We need a program that will bring 
confidence back to the market. This program must be temporary, and 
provide a reasonable chance of success for the businesses and the 
taxpayers who are participating in it. It also must be accountable and 
transparent. The American taxpayers should know what they are getting 
with their investment, and to date, they do not.
  I am willing to work with my colleagues on a reform package that will 
do all of these things. However, the first step must be to put the 
brakes on this reckless spending. Doing so will provide us with the 
opportunity to make the program better, and fulfill our obligation to 
the taxpayers funding this program with their hard-earned money.
  I strongly urge my colleagues to vote in support of the resolution of 
  Mr. LEVIN. Madam. President, we are in a crisis unparalleled since 
the Great Depression. We are on a deeply troubling path, marked by 
credit freezes, foreclosures, rising unemployment, and declining 
purchasing power. And that path, in the autumn of last year, appeared 
to be heading toward a cliff. We were fearful of what might happen if 
we stood idle and allowed our economy to fall off that cliff.
  The initial Emergency Economic Stabilization Act proposal put forth 
by the White House and the Treasury Department was unacceptable. It was 
essentially a blank check for $700 billion to be spent however they 
pleased. There were no provisions for oversight, no accountability, no 
mechanism to ensure that the funds were well-spent. Congress did 
significant work to create a more acceptable proposal, including 
dividing the recovery funds into two pieces, the second of which could 
be disapproved by Congress.
  In the months since we passed that legislation, I have been deeply 
disappointed in the way the administration has handled the program. 
Although we required the Treasury Department to maximize assistance for 
homeowners and work to minimize foreclosures, no systematic foreclosure 
mitigation program has been adopted, let alone implemented. Although 
the goal of the legislation was to unfreeze credit markets, the 
Treasury Department did not take reasonable steps to ensure that a 
significant portion of the billions of dollars distributed to banks 
across the country were used for this purpose.
  Indeed, in one specific example, one bank that received over $2 
billion in TARP funding has been reducing the lines of credit for 
Michigan businesses that have been longtime customers of the bank 
without a single default. I am hearing similar accounts from across 
Michigan and throughout the Nation. This slashing of credit by banks 
receiving federal funds is the opposite of what TARP was intended to 
  Many may recall that the originally stated purpose of the Troubled 
Asset Relief Program was to focus on purchasing ``toxic'' assets from 
financial institutions. While Congress set significant disclosure and 
oversight requirements to monitor these purchases, we also provided 
flexibility for the Treasury Department to respond rapidly to the 
developing crisis. Treasury decided

[[Page S577]]

that the originally conceived TARP program would not suffice to save 
our economy from the approaching cliff, so the administration turned to 
capital injections. The administration does not know what this massive 
infusion of capital has done to mitigate the economic crisis. They 
established no metrics to judge whether the program is working. 
Recipients of funds have not been required to set benchmarks as to how 
the funds should be used, let alone track, report to regulators or 
disclose to the public what they are doing with the funds.
  Many of the financial institutions that have received TARP funds 
continue to give out annual performance bonuses, many of which are 
larger than most hard-working Americans earn in decades of labor. And, 
as we have seen in the front pages of national papers this week, there 
are real concerns about the long-term viability of some of the banks 
receiving funds, yet those funds have gone out the door without 
requiring any written plan from the banks as to how they will continue 
operations or repay the taxpayers.
  Even as the administration gave financial institutions carte blanche 
with few, if any, questions asked, they first refused to provide TARP 
funds to our domestic automakers and then did so only with significant 
oversight and restructuring requirements. The double standard here is 
  Because of all these shortcomings in the use and oversight of the 
first $350 billion of TARP funds, I would oppose the release of the 
second $350 billion if those funds were to be used as sloppily.
  Yesterday I sent a letter to National Economic Council Director-
designate Dr. Larry Summers seeking further and more detailed 
assurances. I will ask to have that letter printed in the Record. I 
believe the assurances I requested are commonsense positions that are 
essential to a well-run, effective stabilization plan that protects 
taxpayers money. The assurances I requested are:
  No. 1, does the incoming Obama administration assure Congress that 
TARP recipients will be required by the Treasury to track and report 
their use of TARP funds and that this information will be made 
available to the Congress and the public?
  No. 2, does the incoming Obama administration assure Congress that 
recipients of ``exceptional assistance'' will be subject to at least 
the same compensation limits as have been placed on recipients of funds 
under the TARP's Automotive Industry Financing Program?

  No. 3, does the incoming Obama administration assure Congress that 
Treasury will obtain agreements from TARP recipients on benchmarks the 
recipient is required to meet so as to advance the purposes of TARP?
  No. 4, does the incoming Obama administration assure Congress that it 
will ensure that banks use a significant portion of TARP funds to 
extend credit?
  No. 5, does the incoming Obama administration assure Congress that a 
significant portion of the remaining TARP funds will be used to carry 
out a comprehensive plan to prevent and mitigate foreclosures on 
residential mortgages?
  No. 6, does the incoming Obama administration assure Congress that 
banks which receive ``exceptional assistance'' will be required to 
adopt a systematic residential mortgage mitigation program?
  No. 7, does the incoming Obama administration assure Congress that 
recipients of assistance under TARP and other Federal programs will be 
required to develop and submit a written financial viability plan just 
as was required of recipients of funds under the Automotive Industry 
Financing Program?
  Just a couple of hours ago, we received a response from Dr. Summers 
addressed to Senator Reid. The letter goes a long way to providing 
positive answers to most of my questions. To summarize a few of the 
  No. 1, TARP recipients will have to track and report their lending 
patterns and report this information to the public.
  No. 2, healthy banks without major capital shortfalls will have to 
increase lending above baseline levels.
  No. 3, they pledge to commit $50 to $100 billion of the TARP funds to 
address the foreclosure crisis, and banks receiving TARP support will 
be required to implement mortgage foreclosure mitigation programs.
  I am disappointed that the letter did not provide assurances that 
banks and other financial institutions receiving TARP funds will be 
subject to the same rigorous standards with respect to executive 
compensation and the submission of viability plans that Congress and 
the Bush administration demanded of the auto companies. I have 
responded to Dr. Summers letting him know I look forward to hearing his 
response to the balance of my suggestions. I will ask to have that 
letter printed in the Record.
  On a related matter, in December, the Bush administration committed 
to provide $13.4 billion in funds from the TARP to facilitate the 
restructuring of our American auto manufacturers and said that an 
additional $4 billion would be available in February. Of necessity, 
this additional $4 billion must come from the second $350 billion, and 
we have been assured that will happen. In return for this much-needed 
bridge financing, the domestic auto manufacturers agreed in December to 
terms and conditions that went way beyond anything required of other 
recipients of TARP funding. There was broad support for these loans for 
the domestic auto industry because there was broad recognition that 
this industry is the foundation of our Nation's manufacturing sector 
and industrial base and a recognition that its failure was simply 
unacceptable. We must complete the job started in December and ensure 
that the additional funding necessary for the financial health of this 
critical U.S. industry is provided in a timely manner. Support from the 
Federal Government is essential if the energy efficient green vehicles 
of the future will be produced by American companies and American 
workers. Other auto-producing countries are acting to assure the 
survival of their industries. So must we.
  Perhaps because of the current administration's poor record of 
accomplishment with the first $350 billion and the lack of 
accountability with which the distribution of those funds has been 
carried out, our economic position today is not discernibly stronger 
than it was 3 months ago. We are threatened by further bank failures, 
creditworthy consumers and businesses are having trouble accessing 
credit, and it appears that if we do not act our economy may decline 
even further.
  As was the case 3 months ago, it would be irresponsible to stand by 
and do nothing as our economy heads toward a cliff. It would be 
negligent to tie the hands of the incoming administration because of 
the outgoing administration's deficiencies.
  I am convinced by what we know of continuing bank losses and the 
hurting credit markets that it would be irresponsible to refuse the 
President this weapon for economic recovery. Bringing about economic 
stabilization and restoring a healthy economy will not be an easy task. 
We are contracting from an unprecedented and irresponsible boom in 
lending over the past years, which led financial institutions to make 
loans to borrowers who could not repay them. Unfortunately, in the 
aftermath, the pendulum is swinging the other way and many banks are 
fearful of making any loans at all, even to creditworthy borrowers. It 
is my hope that with more TARP funds available, reporting requirements, 
and established goals, banks will resume making responsible loans. Part 
of this will require that Treasury focus not just on the banks that 
many deem ``too big to fail'' but also on community and independent 
banks that are the financial backbone of many small towns through their 
support of local businesses and families.
  Coupled with the stimulus package Congress will consider in the next 
month and then a much needed financial regulatory overhaul in the 
spring, we can begin to turn away from the deregulatory disaster of 
recent years and return to a healthy economy with cops on the beat to 
help restore confidence in our financial system and prevent another 
financial disaster like the one we find ourselves in now.
  Madam President, I ask unanimous consent to have the letters to which 
I referred printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

[[Page S578]]

                                                  U.S. Senate,

                                 Washington, DC, January 14, 2009.
     Lawrence Summers,
     Director-designate, National Economic Council, Washington, 
       Dear Dr. Larry: Before Congress votes on whether to release 
     the second $350 billion in TARP funds, I would like to 
     receive the following assurances regarding federal assistance 
     under TARP and other programs to supplement the assurances 
     you provided in the letter to the Congressional leadership 
     dated January 12, 2009.
       1. The second report of the Congressional Oversight Panel, 
     issued January 9, 2009, states: ``The Panel still does not 
     know what the banks are doing with taxpayer money. Treasury 
     places substantial emphasis in its December 30 letter on the 
     importance of restoring confidence in the marketplace. So 
     long as investors and customers are uncertain about how 
     taxpayer funds are being used, the question both the health 
     and the sound management of all financial institutions. The 
     recent refusal of certain private financial institutions to 
     provide any accounting of how they are using taxpayer money 
     undermines public confidence. For Treasury to advance funds 
     to these institutions without requiring more transparency 
     further erodes the very confidence Treasury seeks to 
       Your letter states that the Treasury Department will 
     ``monitor, measure and track what is happening to lending by 
     recipients of our financial rescue assistance.''
       Does the incoming Obama Administration assure Congress that 
     TARP recipients will be required by the Treasury to track and 
     report their use of TARP funds, and that this information 
     will be made available to the Congress and the public?
       2. The Summers letter states that recipients of 
     ``exceptional assistance'' will be ''subject to tough but 
     sensible conditions that limit executive compensation until 
     taxpayer money is paid back, ban dividend payments beyond de 
     minimis amounts, and put limits on stock buybacks and the 
     acquisition of already financially strong companies.''
       Does the incoming Obama Administration assure Congress that 
     recipients of ``exceptional assistance'' will be subject to 
     at least the same compensation limits as have been placed on 
     recipients of funds under the TARP's Automotive Industry 
     Financing Program?
       3. Does the incoming Obama Administration assure Congress 
     that Treasury will obtain agreements from TARP recipients on 
     benchmarks the recipient is required to meet so as to advance 
     the purposes of TARP?
       4. Does the incoming Obama Administration assure Congress 
     that it will ensure that banks use a significant portion of 
     TARP funds to extend credit?
       5. Does the incoming Obama Administration assure Congress 
     that a significant portion of the remaining TARP funds will 
     be used to carry out a comprehensive plan to prevent and 
     mitigate foreclosures on residential mortgages?
       6. Does the incoming Obama Administration assure Congress 
     that banks which receive ``exceptional assistance'' will be 
     required to adopt a systematic residential mortgage 
     mitigation program?
       7. Does the incoming Obama Administration assure Congress 
     that recipients of assistance under TARP and other federal 
     programs will be required to develop and submit a written 
     financial viability plan just as was required of recipients 
     of funds under the Automotive Industry Financing Program?
       Thank you for your prompt response on this important 
                                                       Carl Levin.

                                                  U.S. Senate,

                                 Washington, DC, January 15, 2009.
     Dr. Lawrence H. Summers,
     National Economic Council.
       Dear Larry: Thank you for your letter to Senator Reid today 
     outlining additional reforms you will adopt in implementing 
     the Emergency Economic Stabilization Act of 2008. These 
     reforms address many of the suggestions I made in my letter 
     to you of January 14. I look forward to hearing your response 
     to the balance of my suggestions.
       I appreciated the assurances I received in Tuesday's 
     Democratic Caucus from the President-elect and you that the 
     new Administration will provide the additional $4 billion for 
     loans from TARP Tranche 2 to the U.S. auto industry in 
     February in accordance with the plan announced by the Bush 
                                                       Carl Levin.

  Mr. FEINGOLD. Madam President, I will support the resolution 
disapproving the remaining $350 billion in funding for the financial 
bailout. While President-elect Obama's team has signaled some 
significant improvements in the actual administration of these funds, 
the three fundamental issues that caused me to oppose the bailout 
initially remain.
  The bailout continues to be a huge strain on our budget, with no 
provision for offsetting its cost to the Federal budget--a cost that 
will be passed on to our children and grandchildren in the form of 
increased debt. There is no requirement to help families facing 
foreclosures on their homes, one of the root causes of the housing 
crisis. And finally it fails to reform the deeply flawed regulatory 
structure that permitted the crisis to arise in the first place. While 
we have heard promises of future legislation, the hammer we hold over 
the financial sector is the bailout funding. Once that funding is 
approved, we have lost the leverage needed to enact the tough reforms 
that will get the financial sector to clean up its act.
  As I had hoped, a small portion of the financial bailout funds were 
used to provide temporary help for our automakers and help retain 3 
million manufacturing jobs in this country. While I opposed the 
financial bailout for the reasons I have just spelled out, given that 
those funds were approved I felt it only right that a tiny percentage 
of them be used to help millions of working families whose livelihoods 
depend on a healthy automobile industry. Despite my concerns, I fully 
expect this second $350 billion for the financial bailout to be 
approved, and if it is, I certainly expect that the promise of 
additional financial backing for the automobile industry, and the 
millions of jobs associated with it, will be forthcoming.
  As I have noted before, while some of the troubles of the automobile 
industry were of their own making, a great many of the problems facing 
domestic automakers are the direct result of policies enacted or 
ratified in Washington. The collapse of the housing and credit markets, 
the result of two decades of the reckless disassembly of a sound 
regulatory system, clearly hit the credit-sensitive auto industry hard. 
In addition, bipartisan majorities in Congress, led by Democratic and 
Republican Presidents, approved deeply flawed trade policies that have 
further disadvantaged the domestic auto industry. Currency manipulation 
by foreign competitors that has not been adequately addressed by our 
national leadership, too, has put our domestic producers at an enormous 
competitive disadvantage. Given Washington's policymaking complicity in 
the problems facing our domestic automobile industry, should these 
additional bailout funds for Wall Street move forward, a slice of them 
should rightly be used to provide some assistance for an industry that 
means so much for millions of American families.
  Mr. McCAIN. Madam President, I will support the resolution before us 
today and oppose releasing the remaining Troubled Asset Relief Plan, 
TARP, funds because I have seen no evidence that the additional and 
substantial taxpayers' money will be used for its intended purpose. 
TARP was created to allow the Treasury Department to purchase up to 
$700 billion in ``toxic assets'' from financial institutions in order 
to help homeowners facing foreclosure and to stimulate the economy. The 
misuse of the first $350 billion of TARP funds combined with the lack 
of transparency promised by Secretary Paulson should be reason enough 
to oppose releasing additional funds. No further TARP funds should be 
released until we are able to impose strict standards of accountability 
and ensure that the money is spent only as intended by Congress--to 
purchase mortgage-backed securities and other troubled assets.
  Today, in an open letter to Members of Congress, 26 public interest 
organizations wrote that ``(T)he stated purpose of the TARP was to 
purchase toxic mortgage assets. The TARP was also designed to 
reintroduce the flow of credit into the market and help stabilize Wall 
Street. To date, neither has been accomplished.'' The letter also 
states that the Treasury Department ``has invaded the free market, 
propping up some companies to the detriment of others and purchasing 
stock in banks without requiring accountability or transparency about 
the use of taxpayer funds.'' The signatories included the American 
Shareholders Association, Americans for Tax Reform, the Center for 
Fiscal Accountability, the Competitive Enterprise Institute, the 
Council for Citizens Against Government Waste, the Family Research 
Council, the National Center for Public Policy Research, and National 
Taxpayers Union. I will ask to have the full text of the letter printed 
in the Record.
  There is no doubt that Congress intended that the Treasury Department 
use the funds provided to assist only financial institutions. But that 
has not

[[Page S579]]

been the case. The language authorizing the TARP program has been 
interpreted to allow Treasury to change the game plan and use the funds 
for things outside the scope of congressional intent. Less than 2 weeks 
after enactment of the program, Secretary Paulson changed course and 
decided instead to use TARP funds to recapitalize banks--a decision 
that was made with little or no input from Congress and was an option 
that was explicitly rejected by Paulson and Bernanke when they were 
selling the TARP plan to Congress.
  In fact, just this morning the Wall Street Journal reported that Bank 
of America is close to finalizing a deal with the Government which will 
give them billions of dollars in U.S. aid. The lead article on the 
Journal's front page states: ``(T)he commitment of the funds is further 
evidence of the banking system's delicate condition and its hunger for 
more capital, despite billions of dollars already invested in financial 
institutions by the government. So far, the U.S. government has already 
injected $25 billion into Bank of America.''
  The Associated Press recently investigated how the TARP funds given 
to U.S. banks were being spent. An article published on December 22, 
2008, reported what they found. It was astonishing. The article, titled 
``Where'd the bailout money go? Shhhh, it's a secret'' reads partly:
       Washington (AP)--Think you could borrow money from a bank 
     without saying what you were going to do with it? Well, 
     apparently when banks borrow from you they don't feel the 
     same need to say how the money is spent.
       After receiving billions in aid from U.S. taxpayers, the 
     nation's largest banks say they can't track exactly how 
     they're spending it. Some won't even talk about it.
       ``We're choosing not to disclose that,'' said Kevin Heine, 
     spokesman for Bank of New York Mellon, which received about 
     $3 billion.
       Thomas Kelly, a spokesman for JPMorgan Chase, which 
     received $25 billion in emergency bailout money, said that 
     while some of the money was lent, some was not, and the bank 
     has not given any accounting of exactly how the money is 
     being used.
       ``We have not disclosed that to the public. We're declining 
     to,'' Kelly said.
       The Associated Press contacted 21 banks that received at 
     least $1 billion in government money and asked four 
     questions: How much has been spent? What was it spent on? How 
     much is being held in savings, and what's the plan for the 
       None of the banks provided specific answers.
       ``We're not providing dollar-in, dollar-out tracking,'' 
     said Barry Koling, a spokesman for Atlanta, Ga.-based 
     SunTrust Banks Inc., which got $3.5 billion in taxpayer 
       Some banks said they simply didn't know where the money was 
       ``We manage our capital in its aggregate,'' said Regions 
     Financial Corp. spokesman Tim Deighton, who said the 
     Birmingham, Ala.-based company is not tracking how it is 
     spending the $3.5 billion it received as part of the 
     financial bailout.
       There has been no accounting of how banks spend that money. 
     Lawmakers summoned bank executives to Capitol Hill last month 
     and implored them to lend the money--not to hoard it or spend 
     it on corporate bonuses, junkets or to buy other banks. But 
     there is no process in place to make sure that's happening 
     and there are no consequences for banks that don't comply.
       Pressured by the Bush administration to approve the money 
     quickly, Congress attached nearly no strings to the $700 
     billion bailout in October. And the Treasury Department, 
     which doles out the money, never asked banks how it would be 

  I will ask to have the full article printed in the Record.
  With no regard for congressional intent, the Treasury Department has 
used TARP funds to prop up the banking industry and to guarantee 
securities backed by student loans and credit card debt. But most 
troubling to me has been the use of TARP funds to help bail out the 
domestic auto industry--in direct defiance of Congress. Last month, 
after extensive discussion and debate, the Senate rejected a plan to 
pump billions of Federal dollars into the domestic auto industry 
because we saw no evidence of serious concessions from the industry and 
no assurance of the domestic auto manufacturers' long-term viability.
  At the time I said that, before they ask for assistance, the 
automakers will need to change dramatically the way they do business if 
they hope to be on course for long-term profitability. Rather than 
seeking an unconditional handout from the taxpayer, industry leaders 
must first consider how they can restructure their business models in 
order to fix the problem themselves and build more competitive 
products--including changes in management, renegotiating labor 
agreements, and reorganizing under the bankruptcy process. And, that 
they should have been doing so months, if not years, ago.
  When I opposed the auto bailout plan last month it was mainly because 
I felt that the automakers needed to prove to Congress and the American 
people that they were serious about making the changes necessary to 
ensure their long-term success before they sought assistance from the 
taxpayer. Unfortunately, those concerns were ignored by the President 
when he decided to give away over $17 billion in TARP funds to the 
domestic automakers with no assurances that they would fundamentally 
change the way they do business to ensure their viability. I continue 
to believe that this was a critical mistake.
  In their first oversight report on TARP spending, the Government 
Accountability Office, GAO, was very critical of Treasury stating that 
they had ``failed to address a number of critical issues while 
implementing the $700 billion financial bailout plan, including how to 
ensure its efforts are successful.'' The report adds that Treasury 
``has no policies or procedures in place for ensuring the institutions 
. . . are using capital investments in a manner that helps meet the 
purposes of the act.'' Additionally, the GAO reported that ``Treasury 
cannot effectively hold participating institutions accountable for how 
they use the capital injections or provide strong oversight of 
compliance with the requirements under the act.''
  In addition to the GAO, many of my colleagues have been very critical 
of Secretary Paulson and his handling of the first half of the TARP 
funds, stating that he has ignored the intent of the bailout 
legislation because he has done little to address the root cause of the 
financial meltdown--namely the mortgage market. I understand the anger 
of my colleagues, indeed, I share it.
  It is abundantly clear that there has been a stunning lack of 
transparency, accountability, and effective management of TARP funds to 
date. Because of this, I will not support the release of another dime 
of these funds without first seeing a full and complete accounting of 
funds already spent or committed as well as the imposition of very 
strict conditions on the remaining funds as a way to ensure any 
expenditures reflect the intent of Congress.
  Madam President, I ask unanimous consent to have the letters to which 
I referred printed in the Record.
       There being no objection, the material was ordered to be 
     printed in the Record, as follows:

                Requesting a TARP Disapproval Resolution

                                                 January 15, 2009.
     U.S. Congress,
     Washington, DC.
       Dear Member of Congress: On behalf of the millions of 
     taxpaying citizens represented by the public interest 
     organizations below, we write to strongly encourage you to 
     swiftly pass a notice of disapproval on releasing the 
     remaining $350 billion in Troubled Asset Relief Program 
     (TARP) funds.
       From the beginning, the TARP plan was questionable, but a 
     number of Members nonetheless resolved to support it. It 
     should be clear now that this was a mistake.
       The stated purpose of the TARP was to purchase toxic 
     mortgage assets. Secretary Paulson abandoned this concept 
     immediately after the signing ceremony. The TARP was also 
     designed to reintroduce the flow of credit into the market 
     and help stabilize Wall Street. To date, neither has been 
       In addition to misleading Congress about his intent on the 
     use of TARP funds, Secretary Paulson has invaded the free 
     market, propping up some companies to the detriment of others 
     and purchasing stock in banks without requiring 
     accountability or transparency about the use of taxpayer 
       The TARP legislation specifically requires that before the 
     second half of the $700 billion is released, the President 
     provide Congress with a written report detailing how the 
     additional funds are to be used. A request to spend the 
     second half of the funds without restraint does not meet the 
     requirements set forth in the bill. In addition to requiring 
     this detailed plan, Congress should require an accounting and 
     detailed explanation on how the initial TARP funds have been 
     used and the prospect of a taxpayer recovery of these funds.
       Congress now has an opportunity to preserve some of the 
     taxpayers' assets and should spend the necessary time 
     studying the underlying causes of the economic down-

[[Page S580]]

     turn by passing a TARP disapproval resolution. We encourage 
     you to take such action.
         African American Republican Leadership Council, Alex-St. 
           James, Chairman; American Shareholders Association, 
           Ryan Ellis, Executive Director; Americans for Limited 
           Government, William Wilson, President; Americans for 
           Tax Reform, Grover Norquist, President; Americans for 
           the Preservation of Liberty, Mark Chmura, Executive 
           Director; America's Survival, Inc., Cliff Kincaid, 
           President; Center for Fiscal Accountability, Sandra 
           Fabry, Executive Director; Center for Investors and 
           Entrepreneurs, John Berlau, Director; Citizens United, 
           David N. Bossie, President; Coalition for a 
           Conservative Majority, Ken Blackwell, Chairman.
         Competitive Enterprise Institute, Fred L. Smith, Jr., 
           President; Council for America, Ron Pearson, President; 
           Council for Citizens Against Government Waste, Thomas 
           Schatz, President; Family Research Council, Thomas 
           McClusky, VP for Government Affairs; Federal 
           Intercessors, Mark Williamson, President and Founder; 
           Free Market Foundation, Kelly Shackelford, Esq., 
           President; FRC Action, Connie Mackey, Senior VP; 
           Maryland Center-Right Coalition, Richard W. C. Falknor, 
         Minuteman Civil Defense Corps., Carmen Mercer, Vice 
           President; Minuteman Foundation, Carmen Mercer, 
           President; National Center for Public Policy Research, 
           Amy Ridenour, Chairman; National Taxpayers Union, Duane 
           Parde, President; RedState.com, Erick Erickson, Editor; 
           RightMarch.com, Dr. William Greene, President; The 
           FlashReport Website on CA Politics, Jon Fleischman, 
           Founder; The Inspiration Networks, Ron Shuping, 
           Executive VP of Programming.

           Where'd the Bailout Money Go? Shhhh, It's a Secret

                    (By Matt Apuzzo, Dec. 22, 2008)

       Washington (AP).--Think you could borrow money from a bank 
     without saying what you were going to do with it? Well, 
     apparently when banks borrow from you they don't feel the 
     same need to say how the money is spent.
       After receiving billions in aid from U.S. taxpayers, the 
     nation's largest banks say they can't track exactly how 
     they're spending it. Some won't even talk about it.
       ``We're choosing not to disclose that,'' said Kevin Heine, 
     spokesman for Bank of New York Mellon, which received about 
     $3 billion.
       Thomas Kelly, a spokesman for JPMorgan Chase, which 
     received $25 billion in emergency bailout money, said that 
     while some of the money was lent, some was not, and the bank 
     has not given any accounting of exactly how the money is 
     being used.
       ``We have not disclosed that to the public. We're declining 
     to,'' Kelly said.
       The Associated Press contacted 21 banks that received at 
     least $1 billion in government money and asked four 
     questions: How much has been spent? What was it spent on? How 
     much is being held in savings, and what's the plan for the 
       None of the banks provided specific answers.
       ``We're not providing dollar-in, dollar-out tracking,'' 
     said Barry Koling, a spokesman for Atlanta, Ga.-based 
     SunTrust Banks Inc., which got $3.5 billion in taxpayer 
       Some banks said they simply didn't know where the money was 
       ``We manage our capital in its aggregate,'' said Regions 
     Financial Corp. spokesman Tim Deighton, who said the 
     Birmingham, Ala.-based company is not tracking how it is 
     spending the $3.5 billion it received as part of the 
     financial bailout.
       The answers highlight the secrecy surrounding the Troubled 
     Asset Relief Program, which earmarked $700 billion--about the 
     size of the Netherlands' economy--to help rescue the 
     financial industry. The Treasury Department has been using 
     the money to buy stock in U.S. banks, hoping that the sudden 
     inflow of cash will get banks to start lending money.
       There has been no accounting of how banks spend that money. 
     Lawmakers summoned bank executives to Capitol Hill last month 
     and implored them to lend the money--not to hoard it or spend 
     it on corporate bonuses, junkets or to buy other banks. But 
     there is no process in place to make sure that's happening 
     and there are no consequences for banks that don't comply.
       ``It is entirely appropriate for the American people to 
     know how their taxpayer dollars are being spent in private 
     industry,'' said Elizabeth Warren, the top congressional 
     watchdog overseeing the financial bailout.
       But, at least for now, there's no way for taxpayers to find 
     that out.
       Pressured by the Bush administration to approve the money 
     quickly, Congress attached nearly no strings to the $700 
     billion bailout in October. And the Treasury Department, 
     which doles out the money, never asked banks how it would be 
       ``Those are legitimate questions that should have been 
     asked on Day One,'' said Rep. Scott Garrett, R-N.J., a House 
     Financial Services Committee member who opposed the bailout 
     as it was rushed through Congress. ``Where is the money going 
     to go to? How is it going to be spent? When are we going to 
     get a record on it?''
       Nearly every bank AP questioned--including Citibank and 
     Bank of America, two of the largest recipients of bailout 
     money--responded with generic public relations statements 
     explaining that the money was being used to strengthen 
     balance sheets and continue making loans to ease the credit 
       A few banks described company-specific programs, such as 
     JPMorgan Chase's plan to lend $5 billion to nonprofit and 
     health care companies next year. Richard Becker, senior vice 
     president of Wisconsin-based Marshall & Ilsley Corp., said 
     the $1.75 billion in bailout money allowed the bank to 
     temporarily stop foreclosing on homes.
       But no bank provided even the most basic accounting for the 
     federal money.
       Some said the money couldn't be tracked. Bob Denham, a 
     spokesman for North Carolina-based BB&T Corp., said the 
     bailout money ``doesn't have its own bucket.'' But he said 
     taxpayer money wasn't used in the bank's recent purchase of a 
     Florida insurance company. Asked how he could be sure, since 
     the money wasn't being tracked, Denham said the bank would 
     have made that deal regardless.
       Others, such as Morgan Stanley spokeswoman Carissa Ramirez, 
     offered to discuss the matter with reporters on condition of 
     anonymity. When AP refused, Ramirez sent an e-mail saying: 
     ``We are going to decline to comment on your story.''
       Most banks wouldn't say why they were keeping the details 
       ``We're not sharing any other details. We're just not at 
     this time,'' said Wendy Walker, a spokeswoman for Dallas-
     based Comerica Inc., which received $2.25 billion from the 
       One didn't even want to say they wouldn't say.
       Heine, the New York Mellon Corp. spokesman who said he 
     wouldn't share spending specifics, added: ``I just would 
     prefer if you wouldn't say that we're not going to discuss 
     those details.''
       The banks which came closest to answering the questions 
     were those, such as U.S. Bancorp and Huntington Bancshares 
     Inc., that only recently received the money and have yet to 
     spend it. But neither provided anything more than a generic 
     summary of how the money would be spent.
       Lawmakers say they want to tighten restrictions on the 
     remaining, yet-to-be-released $350 billion block of bailout 
     money before more cash is handed out. Treasury Secretary 
     Henry Paulson said the Department is trying to step up its 
     monitoring of bank spending.
       ``What we've been doing here is moving, I think, with 
     lightning speed to put necessary programs in place, to 
     develop them, implement them, and then we need to monitor 
     them while we're doing this,'' Paulson said at a recent forum 
     in New York. ``So we're building this organization as we're 
       Warren, the congressional watchdog appointed by Democrats, 
     said her oversight panel will try to force the banks to say 
     where they've spent the money.
       ``It would take a lot of nerve not to give answers,'' she 
       But Warren said she's surprised she even has to ask.
       ``If the appropriate restrictions were put on the money to 
     begin with, if the appropriate transparency was in place, 
     then we wouldn't be in a position where you're trying to call 
     every recipient and get the basic information that should 
     already be in public documents,'' she said.
       Garrett, the New Jersey congressman, said the nation might 
     never get a clear answer on where hundreds of billions of 
     dollars went.

  Mr. KOHL. Madam President, the Senate is voting to release the final 
$350 billion of funds to the Department of Treasury for the Troubled 
Asset Relief Program, TARP, a move I reluctantly supported.
  Since Congress passed the Emergency Economic Stabilization Act of 
2008, the public and elected officials have become increasingly 
frustrated with how the Treasury Department implemented the TARP. The 
Treasury has implemented little to no oversight, required no 
transparency from banks receiving funds and has done very little to 
stem the rising foreclosure problem. A total of 87 financial 
institutions have received funds from the Treasury Department, 
including four from Wisconsin. When I asked the Wisconsin banks to show 
me how they used the Treasury funds they were happy to share how they 
were combating the financial crisis. For example, Associated Banc-Corp 
increased their mortgage loan activity by 20 percent. Marshall and 
Ilsey implemented a 90-day foreclosure moratorium in order to provide 
assistance to at-risk homeowners. These banks are an example of how the 
TARP program is injecting credit back into the market. Unfortunately, 
not every bank is following their example.
  The current administration has failed to create regulations to 
monitor the funds and ensure that the taxpayer dollars are being used 
appropriately to unfreeze the credit markets and assist at-risk 
homeowners. I was very concerned about extending the incoming 
administration the additional funds

[[Page S581]]

without any assurances or clear plans on how to increase transparency, 
oversight and lending. Thankfully, the President-elect and his advisors 
have sent Senator Reid a letter clearly laying out new measures 
creating transparency, refocusing the funds on foreclosures, and 
protecting taxpayer investments. As we move forward, I am confident 
that Congress and the new administration will work together to continue 
to promote economic stability, preserve homeownership, and protect 
taxpayer interests.
  Mr. SPECTER. Madam President, I have sought recognition to discuss 
the resolution of disapproval on the release of the final $350 billion 
of the economic rescue package.
  At the outset, I am dissatisfied with the way the first $350 billion 
has been spent because of failure to deal with the home mortgage issue, 
the ineffectiveness in restoring normal lending to consumers and 
businesses, and the lack of transparency. The Treasury Department 
started off by stating that it would purchase toxic securities backed 
by troubled home mortgages but has since shifted to providing funds for 
the banks, some of which didn't want them. That didn't loosen up the 
credit market. One of the key problems has been foreclosures, which the 
first $350 billion hasn't begun to deal with. Good ideas like FDIC 
Chairwoman Bair's have been rejected.
  As a matter of public policy, I am opposed to bailouts. In our free 
enterprise system, the market, not the Government, should determine 
winners and losers. However, there is a necessary exception when the 
potential consequences of failing to provide Federal economic aid could 
produce a devastating effect on the economy. That was the basis for the 
very tough vote which I cast in supporting the $700 billion economic 
stabilization package because I felt that the failure of Congress to 
take some decisive, substantial action would run the risk of dire 
consequences to the U.S. economy.
  I objected to the process used to consider the $700 billion package. 
Insufficient consideration by the Treasury Department and the Federal 
Reserve followed by a rush to judgement by Congress resulted in 
legislation that had not been given appropriate consideration. I wrote 
a series of letters and advocated for the Senate to follow regular 
order, which starts with the introduction of legislation, committee 
hearings and markup, debate and amendment by individual Members, and 
the House-Senate conference. The President then reviews the final bill.
  Ultimately, Congress did not follow regular order. Instead, Senators 
were only given a chance to vote yes or no on what started as a 4-page 
memorandum from the Treasury Department and quickly grew to 414 pages. 
As a result, the bill included undesirable pork provisions. Had there 
been an opportunity to offer amendments, these undesirable provisions 
could have been removed. In a series of town meetings in October, I 
found the temperature of my constituents at 212 degrees Fahrenheit.
  We are now confronted with a decision of whether to release the final 
$350 billion installment of the program. The authorizing legislation 
passed by Congress in October did not release the entire $700 billion 
immediately, but instead there have been installments of $250 billion, 
$100 billion at the request of the President and $350 billion more 
subject to congressional objection. At the time, I raised concerns that 
a resolution of disapproval by Congress on the final $350 billion may 
be unconstitutional under the Supreme Court decision in INS v. Chadha. 
The resolution of disapproval requires a majority vote in both Houses 
for adoption and is subject to a veto by the President.
  In coming to a determination of how to vote on the resolution of 
disapproval, I felt it important to evaluate the effectiveness of the 
program to date, whether the outgoing administration has carried out 
its responsibilities as intended by Congress, the intentions of the 
incoming administration to utilize the program, and the necessity for 
further market stabilization based on current economic conditions.
  The $700 billion economic rescue was requested by the administration 
in September as major financial institutions were threatened with 
failure as a result of toxic assets on their balance sheets. Treasury 
Secretary Paulson and Federal Reserve Chairman Bernanke warned of an 
imminent meltdown in financial markets which would threaten retirement 
funds, jeopardize the jobs of millions of Americans, and subject 
homeowners to more evictions. Major institutions such as Bear Stearns, 
Lehman Brothers, and AIG had already reached a tipping point, and the 
Federal Government began making decisions on a case-by-case basis of 
whether to extend assistance. The stock market followed each move 
closely. It was argued that unless financial institutions were able to 
sell off securities backed by souring assets such as subprime mortgages 
there would be additional failures that would jeopardize the worldwide 
markets in an irreversible manner.
  After enactment in early October, the Treasury Department quickly 
began implementation of the Troubled Asset Relief Program, or TARP as 
it came to be known. In what was widely seen as a reversal of position, 
on October 14, 2008, the Treasury Department announced that $250 
billion would be devoted to purchasing senior preferred shares in 
financial institutions as part of the Capital Purchase Program, CPP, to 
``encourage U.S. financial institutions to build capital to increase 
the flow of financing to U.S. businesses and consumers and to support 
the U.S. economy.'' According to a January 14, 2009, article in the New 
York Times, 257 financial institutions in 42 states had received $192 
billion in capital injections from the CPP, with 7 of those firms 
receiving 62 percent of the funds. Additional funds have been devoted 
to AIG, $40 billion; Citigroup, $25 billion; the auto industry $19 
billion, and to backstop a Federal Reserve program to boost consumer 
lending, $20 billion.
  While these initial investments may be viewed as a success in fending 
off an outright collapse of our financial markets, there has been 
little evidence thus far that there has been a loosening of the credit 
markets resulting in increased lending by banks to consumers and 
businesses. Instead, there has been widespread dissatisfaction among my 
constituents that the funds given to banks have been used for global 
buyouts, as exemplified by Bank of America seeking a larger stake in 
China Constuction Bank, PNC Financial Services Group taking over 
National City Corp., and USB acquiring several California lending 
firms. All three firms received TARP funds. There have even been press 
reports of participating firms using TARP funds for corporate 
sponsorships, as exemplified by CitiBank completing a 20-year contract 
to pay the New York Mets $400 million to name the team's new stadium 
``Citi Field'' and by AIG paying the British soccer team Manchester 
United $125 million for the privilege of having its logo appear on its 
  There has also been inadequate transparency and accountability thus 
far, which was demanded by the taxpayer when Congress enacted the 
authorizing legislation. My constituents have been frustrated to learn 
so little about how their money is being used by these financial 
institutions and about the amount of lending that is taking place. I 
supported the $700 billion economic rescue package because I felt that 
the failure of Congress to take some decisive, substantial action would 
run the risk of dire consequences to the U.S. economy. However, I was 
also led to believe that there would be significant oversight and 
transparency to accompany the broad powers that have been granted.
  This lack of transparency presents a serious challenge to the 
oversight panels created as part of the authorizing legislation. 
According to a December 2, 2008, Government Accountability Office, GAO, 
report, the Treasury Department has not yet imposed reporting 
requirements on the participating financial institutions. Doing so 
would enable Treasury to monitor how the infusions were being used and 
whether they are meeting the goals of increasing the flow of financing 
to U.S. businesses and consumers and encouraging the modification of 
existing residential mortgages for those in need. The GAO report also 
raised questions about Treasury efforts in achieving its intended goals 
and monitoring compliance with limitations on executive compensation 
and dividend payments.
  The five-member Congressional Oversight Panel, COP, created to 
oversee the implementation of the economic

[[Page S582]]

rescue program has been very critical thus far, suggesting that more 
accountability should be in place before the final $350 billion is 
released. The panel is chaired by Harvard professor Elizabeth Warren, 
and its other members are Representative Jeb Hensarling, NY State 
superintendent of banks Richard Neiman, AFL-CIO associate counsel Damon 
Silvers, and former Senator John Sununu. On December 10, the panel 
released its first report which contained 10 questions for the Treasury 
Department. Its second report, released on January 9, 2009, analyzed 
Treasury's answers and stated that its ``initial concerns about the 
TARP have only grown, exacerbated by the shifting explanations of its 
purpose and the tools used by the Treasury.'' It reported that Treasury 
still has not adequately explained how it is selecting banks for its 
capital injection program or its strategy for stabilizing the financial 
markets. It acknowledged that the TARP has forestalled a financial 
collapse, but with ``no demonstrable effects on lending.'' Also, it 
said that Treasury has no ability to ensure banks lend the money they 
have received and no standards for measuring the success of the 
program. It also noted that Treasury ignored or offered incomplete 
answers to some questions.
  The authorizing legislation also created a Special Inspector General 
with authority to track and investigate how the Government spends the 
TARP funds. The President selected, and the Senate confirmed, Neil M. 
Barofsky, a former New York assistant U.S. attorney, for this position. 
According to a January 7, 2009, letter to Finance Committee Chairman 
Baucus, Mr. Barofsky has had some success in pushing Treasury to 
include more restrictions on any funds given out in future 
transactions. As a result, the letter said, Treasury had included new 
standards that will force companies to establish new internal controls 
and account for the Government funds they receive. Mr. Barofsky's first 
formal report is due to the Finance Committee on February 6, 2009.
  There is further frustration from an investigation conducted by the 
Associated Press, AP, showing that there has been insufficient 
transparency into the operations of the banks that have received TARP 
funds. The AP contacted 21 banks that received at least $1 billion in 
Government money and asked four basic questions: How much has been 
spent? What was it spent on? How much is being held in savings? And, 
what is the plan for the rest? According to the AP, none of the banks 
provided specific answers. If the oversight panels are unable to get 
answers to these very basic questions posed by the AP, they will be 
unable to adequately determine the effectiveness of the TARP program.
  I believe that the onus is on the Treasury Department and the Federal 
Reserve to impose reporting requirements on the participating financial 
institutions. It is imperative that the American public have a full 
understanding of how their hard earned tax dollars are being used. In 
the absence of action by the Treasury Department to impose satisfactory 
reporting requirements by participating financial institutions, 
Congress has been forced to consider taking additional legislative 
action. I cosponsored legislation--S. 133, the Troubled Asset Recovery 
Program Transparency Reporting Act--introduced on January 6, 2009, by 
Senators Dianne Feinstein and Olympia Snowe that would require 
participating financial institutions to provide detailed, publically 
available quarterly reports to the Treasury outlining how the funds 
have been used. This legislation further requires that TARP funds not 
be used for lobbying expenditures or political contributions. 
Additionally, this legislation requires the Secretary of the Treasury 
to develop and publish corporate governance principles and ethical 
guidelines for recipients of such funds, including but not limited to 
restrictions governing the hosting, sponsorship, or payments for 
conferences and event, and expenses relating to entertainment or 
similar ancillary corporate expenses. Violators of this legislation 
would be subject to civil penalties including fines and may become 
ineligible for future emergency economic assistance.
  I have additional concerns that there has been little emphasis on 
foreclosure mitigation assistance in the TARP program. On November 14, 
2008, FDIC Chairman Sheila Bair proposed a plan to forestall 
foreclosures by offering banks an incentive to modify mortgages by 
having the Government agree to share in the loss of a loan that fell 
into default. Specifically, mortgage payments for homeowners that are 
at least 2 months delinquent would be reduced to between 31 and 38 
percent of monthly income by modifying the interest rate, extending the 
repayment period, and deferring principle. To encourage servicers to 
participate, the Government would share up to 50 percent of the losses 
if a homeowner who had received a modification later defaulted, and the 
FDIC would pay servicers who process mortgages $1,000 for each modified 
loan. The plan was expected to initially help 2.2 million borrowers get 
new loans, and after some borrowers redefaulted, 1.5 million would 
ultimately keep their homes. The plan was estimated to cost 
approximately $24 billion.
  The FDIC plan was rejected as the Treasury Department looked at other 
strategies, including ways to reduce interest rates on distressed 
loans. However, in the end, neither approach has been implemented. They 
have instead relied on industry-led efforts by Fannie Mae, Freddie Mac, 
and others to voluntarily modify troubled loans.
  In the December 2008 GAO report, it was noted that Treasury had 
initially intended to purchase mortgage backed securities and use its 
ownership position to influence loan servicers and to achieve more 
aggressive mortgage modification standards. The Treasury changed its 
strategy within weeks and, instead, decided to make capital injections 
into financial institutions. It also noted that despite language in the 
lending agreements with these financial institutions to work under 
existing programs to modify the terms of residential mortgages, ``it 
remains unclear how [the Treasury's Office of Financial Stability] and 
the banking regulators will monitor how these institutions are using 
the capital injections to advance the purposes of this act . . .'' The 
Congressional Oversight Panel chair Elizabeth Warren echoed this 
sentiment, ``The bailout money doesn't require a specific approach . . 
. It entrusts Treasury with developing an approach, and that's what 
Treasury should be doing.''
  The incoming administration has sought to assure Congress that it 
would make a number of changes to the TARP program, including a 
``sweeping effort'' to address foreclosures and reduce mortgage 
payments for ``responsible homeowners.'' It has promised efforts to 
boost consumer and business lending. It has also said it will improve 
transparency and accountability for participating firms. However, there 
have been few details on exactly how they plan to move forward.
  It has been argued that further deterioration in the economy will 
require additional intervention. Lawrence Summers, who has been chosen 
to head the National Economic Council by President-elect Obama, has 
called the need for the second round of funds ``imminent and urgent.'' 
In addition, it has been argued that a failure to release the second 
half of the TARP funding could once again frighten the markets and lead 
to a sharp drop in the Dow. The 777-point plunge in the Dow plunge on 
September 29, 2008, in the wake of the House's rejection of the 
legislation, demonstrated the potential for even greater problems if 
Congress did not act.
  Amidst the various criticisms that have been raised against the TARP 
program and its implementation by the outgoing administration, many 
economists remain concerned about the state of the financial system. 
Federal Reserve Chairman Bernanke has expressed concern about the world 
economy and the financial markets and suggested that foreclosure 
prevention and purchases of troubled assets might be useful tools to 
help the economy in the near term. Bernanke also commented that fiscal 
stimulus would not be enough to support the economy. With respect to 
the TARP program, Chairman Bernanke said on January 13, 2009, ``. . . 
Treasury's injection of about $250 billion of capital into banking 
organizations, a substantial expansion of guarantees for bank 
liabilities by the Federal Deposit Insurance Corporation, and the Fed's 
various liquidity programs . . . likely prevented a

[[Page S583]]

global financial meltdown in the fall . . . with the worsening of the 
economy's growth prospects . . . more capital injections and guarantees 
may become necessary to ensure stability and the normalization of 
credit markets.'' He also said, ``Responsible policymakers must 
therefore do what they can to communicate to their constituencies why 
financial stabilization is essential for economic recovery.''
  Also on January 13, 2009, the Fed Vice Chairman Donald Kohn said, 
``The remaining TARP funds will play an essential role in further 
strengthening the financial system and restoring normal credit flows . 
. . An important use of these [TARP] funds will be to step up efforts 
to avoid preventable foreclosures . . . more needs to be done . . . A 
continuing barrier to private investment in financial institutions is 
the large quantity of troubled, hard-to-value assets that remain on 
institutions' balance sheets. The presence of these assets 
significantly increases uncertainty about the underlying value of these 
institutions and may inhibit private investment and new lending.''
  According to a January 14, 2009, article in the New York Times--
mentioned earlier--"Some banking experts are even questioning if the 
bailout may be doing more harm than good.'' It cited a struggling small 
bank in Michigan that had made a series of bad loans but had been given 
a ``cushion'' instead of allowing it to ``sink or swim'' on its own. 
The articled suggested that by doing so, ``It could also delay mergers 
of weaker banks with healthier ones.''
  With a projected deficit of $1.2 trillion for 2009 and a possible 
$800 billion expenditure on a stimulus package in the next few weeks, 
Congress must be vigilant in its use of the taxpayer's dollars. At the 
current time, there appears to be no immediate threat to our financial 
system, which raises the question of whether the additional 
authorization is needed at this time, especially in light of the 
failures with the program so far.
  Based on a comprehensive evaluation of these issues, I am reluctant 
to support an additional authorization of $350 billion at this time. To 
date, I have seen little evidence that the TARP program has been 
effective in increasing lending by the institutions who have received 
billions in taxpayer dollars. I also have serious questions about the 
effectiveness of existing programs to help troubled homeowners and 
whether additional steps should be taken. Further, unless steps are 
taken to significantly improve oversight and transparency of the TARP 
program, my constituents and I will not feel confident that we are not 
simply throwing good money after bad by releasing the final $350 
billion. On the current state of the record, I cannot continue to 
support this program and intend to vote for the resolution of 
disapproval. In the future, I stand ready to act if it appears that a 
failure to take decisive, substantial action would run the risk of dire 
consequences to the U.S. economy.
  Mr. GRASSLEY. Madam President, many Senators, including this one, 
reluctantly supported the Troubled Asset Relief Program last year 
because we were told by the so-called experts that our financial 
markets were on the verge of collapse.
  We were told that we had to deal with the toxic mortgages that were 
clogging up our financial markets by having the government purchase 
them at an auction and hold them until the markets stabilized. The 
theory was to get these troubled assets off the banks' balance sheets 
and provide them with additional funds to lend to credit worthy 
  I had serious doubts about the original plan, but it has never been 
implemented. Instead, the money has been used to invest directly in 
select financial institutions. Essentially, it has become a slush fund 
for the Secretary of Treasury to engage in an erratic industrial policy 
of picking winners and losers among any company directly, or 
indirectly, connected to our financial markets.
  I am deeply troubled by this outcome. I believe Congress was mislead 
with respect to the financial crisis as well and the intended use of 
the funds. Moreover, the administration's decision to use funds to 
provide assistance to the U.S. auto industry was contrary to 
congressional intent.
  The ever-changing nature of the TARP program has introduced a new 
level of uncertainty into our financial markets. Market participants no 
longer know when or where the Federal Government will intervene. This 
unpredictability has a chilling effect on investors and undermines the 
ability to raise capital and make new loans.
  The outgoing administration has misused these funds and failed to 
provide adequate accountability. But, the vote today is about the use 
of the remaining funds by the incoming administration. Unfortunately, 
they have expressed a desire to pursue an even more vigorous policy of 
picking winners and losers, with an extra dose of micro-management 
thrown in for good measure.
  The efficient allocation of credit is vital to the successful 
operation of our economy. Without saving and investment, there can be 
no long-term economic growth. Banks and other financial institutions 
serve a critical role in bringing savers and investors together and 
allocating credit to its most productive use.
  To operate successfully, credit markets need transparency and 
accountability. Transparency is achieved through the reporting and 
disclosure of assets and liabilities. Accountability is achieved 
through the proper alignment of risk and reward. Those who accept risk 
should profit from their success and pay for their losses.
  Unfortunately, we have allowed ourselves to undermine the very 
foundation of our credit markets through a series of well-meaning, but 
ultimately misguided actions. The continuation of the Troubled Asset 
Relief Program will not address these fundamental problems. We need a 
new approach. I'm hopeful Congress will be able to work with the new 
Administration in the coming months to improve our financial markets 
and revitalize our economy.
  Ms. MIKULSKI. Madam President, before I voted for the bailout I said, 
regrettably, a bailout is needed. I voted to get credit flowing again 
to the distressed homeowner, to families and to small businesses. I 
didn't vote to give the money to banks to enable them to continue their 
flawed policies, their hubris and their high handedness. And I didn't 
do it so they could be ungrateful, buy other banks, or give out 
dividends, and to take executives on spa treatments. I was mad as hell 
that the Wall Street Master of the Universe took us into a black hole. 
And I am mad as hell now that they didn't thank the taxpayer.
  The Bush administration misled us about what they would do with the 
money. Now we're finding both they and the banks misused the funds, 
abused the taxpayer and squandered both the money and the opportunity. 
I said if we were going to have a bailout we needed three things, 
rescue, reform, and retribution. I said, no blank checks and no checks 
without balances, help homeowners, and guarantee no golden parachutes 
for the people who got us into this mess. Did the Bush administration 
listen? No. Paulson dodged and ducked, and the taxpayers got duped. 
Distressed homeowners were left in the lurch. Bernie Madoff is in his 
luxurious penthouse and homeowners are being foreclosed and evicted. 
What's wrong with this picture?
  We have already given $350 billion to the big banks, who said they 
were going to lend it, and said they were going to have transparency. 
But instead, we have gotten hoarding, and resistance. Banks don't want 
to tell us what they are doing with our money. When I voted for the 
rescue plan, I thought I was voting for dealing with the credit crisis, 
and bringing the financial system to some form of stability. But what 
has happened is, instead of helping with jobs, we have been helping 
with banks.
  The banks said we want taxpayer money and we want it our way or the 
highway. But thankfully, on Tuesday it's going to be a new day and a 
new way. Obama met with us this week on his economic agenda. We had a 
robust give and take. The number one priority we agreed upon is job 
creation. We need to make sure that for people who have jobs, they get 
to keep them and feel more economic security. And for people who are 
out of work, not only to provide a safety net on unemployment benefits, 
but create opportunities for returning to work or even new jobs. We 
need to give President Obama the tools he needs to get our economy 
going again. We shouldn't hold the misdeeds

[[Page S584]]

of the Bush administration against him.
  We need to work together. People don't want to talk about butting 
heads, they want to talk about kicking butt with the banks. And the 
President-elect and I agree on that. I see myself helping President-
elect Obama kicking butt, to work with people who are in danger of 
losing their homes, not with a bailout but with a workout. The banks 
have to get off the bailout shtick, and start to get on the workout 
shtick with homeowners.
  This week, the President-elect huddled with us, to talk about how his 
plan is different than the previous administration. We need vigilance 
and responsibility that's what President Obama has pledged. Three major 
areas that we will work with the Obama administration are number one, 
oversight and regulation. We will put real financial cops on the beat 
to make sure money goes where it is supposed to. Number two, a 
sweeping, comprehensive effort to address the foreclosure crisis, we 
will use TARP money to get to the root of the crisis, keep people in 
their homes, and save neighborhoods. Number three, get tough and insist 
on transparency. Banks cannot just take the money and run. The new plan 
will make them tell us what they are doing, no dividends, no giving 
money to banks to buy other banks, no golden parachutes, and no spa 
  I will vote for the additional TARP money. Not because I support the 
banks and Wall Street, but because I support our new President, and 
because I support giving him the tools to get our economy rolling 
again. But we need a major attitude adjustment. It is not only what we 
hear from the banks, it is what we do not hear from them. There is no 
sense of gratitude. There is no sense of gratitude that the waitress, 
the single mother, the farmer, the firefighter, is willing to help. 
There is no gratitude, no remorse, no promise to sin no more, no 
``let's make amends.'' Instead, they pay themselves lavish salaries, 
bonuses and perks, like lavish spa retreats.
  At $350 billion, I don't want to be a passive investor. Congress and 
the new President must tell Wall Street, ``You need to go to work and 
dig out of this mess. Help rescue the economy, not the Wall Street 
managers.'' Work for America, it is America that is paying your 
salaries. Give us your best thinking. Give us your energy. It is time 
to restore our economy and restore our national honor. So pull up your 
pants and your pantsuits, and go to work and let's rebuild this 
  Mr. BYRD. Madam President, I will oppose the joint resolution of 
disapproval and vote to release these funds, but I do so adding my 
voice to those putting the incoming administration on notice.
  This is an enormous sum of money and authority being given to the 
Treasury Department, and it is especially worrisome because the 
American public has little confidence in this program. Its transactions 
are opaque. Its potential for abuse is enormous. Its effect on the 
economy remains uncertain.
  According to the public letter sent this week to the House and Senate 
leadership, the incoming Obama administration's economic team has 
committed to a ``full and accurate accounting'' of how these monies are 
invested and ensuring that these resources are not ``enriching 
shareholders or executives.'' The House of Representatives today is 
considering legislation to hold the new administration to its 
commitments, and I hope the Senate will do the same.
  Other promises and commitments are being made, at private briefings 
and closed-door caucuses, as the new administration tries to cajole 
Senators to oppose this disapproval resolution. That is unfortunate 
because I believe it further undermines an already questionable 
program, which could use more transparency, and not less. I realize 
that the new administration inherited this financial mess and that it 
is trying to do the best with the hand that it has been dealt. But I 
hope that it will learn from the mistakes of the outgoing 
administration and, instead, have faith in the wisdom of an informed 
  Having authorized this program only 15 weeks ago, I think the 
Congress should give it time to work. By any objective measure, the 
economy is getting worse. West Virginia's unemployment rate is rising, 
and it has lost hundreds of manufacturing jobs in recent months. In the 
last 2 months, Toyota announced that it would lay off 120 workers at 
its plant in Buffalo. An Ohio-based packaging manufacturer announced it 
would close its plant in Culloden, laying off 41 workers. The Bayer 
MaterialScience plant in New Martinsville, which makes polymers that 
are used in the automobile and housing industries, announced it would 
lay off 70 workers. Columbian Chemical Company announced that it would 
close its plant near Moundsville, laying off 55 workers.
  If the new administration says it needs these tools, then I am 
willing to give it some latitude. But I caution this administration, 
the American people must have transparency. They must see effective 
oversight. They must have confidence that this is not another Ponzi 
scheme, concocted by Madoff-type, money-hungry, Wall Street fat cats, 
who don't care about anything except lining their own pockets.
  If the new administration gets this money, it must do better than its 
predecessor. We have just lived through one failed administration. We 
cannot afford to live through another.
  The PRESIDING OFFICER. The Senator from Illinois is recognized.
  Mr. DURBIN. Madam President, there are moments in the Senate that are 
memorable, but the most memorable moment for me in the last several 
months occurred in the conference room of Speaker Nancy Pelosi when we 
were called in, Democrats and Republicans, House and Senate leaders, 
and sat around a large conference table facing the Secretary of the 
Treasury, Hank Paulson, and the head of the Federal Reserve, Ben 
Bernanke. They opened the meeting by saying that America is facing an 
economic crisis that no one in this room has ever seen, which will spin 
out of control, reaching across the world, creating economic 
consequences you cannot even envision, unless we act and act now. You 
could have heard a pin drop in that room. They said we need hundreds of 
billions of dollars to put into the banking system for credit, and we 
have to do it as quickly as possible or you are going to see major 
corporations in America fail, thousands of jobs lost, and an economic 
recession bordering on a recession. The choice was clear at the end of 
the day. In light of that circumstance and the clear failure of these 
major institutions, we had two choices: do something or do nothing.
  I chose to do something. I voted for this TARP plan--a strong 
bipartisan vote, Democrats and Republicans--and said we have to do 
something, we can't let this happen to our economy and businesses and 
let families and individuals suffer for a long time to come.
  We put in conditions and said: We will split it. Of the $700 billion, 
you can spend the first $350 billion, but you have to come back and ask 
us for the second half, and we will decide whether you have spent it 
  Time passed, and here we are. There is a request from President Bush 
for the remaining $350 billion, but we clearly know he won't spend it. 
It is money that can be spent, may be spent by the new President, 
Barack Obama--by the new administration. Do we need it? Are we still 
facing an economic crisis? Today in America, 17,000 Americans lost 
their jobs, 11,000 lost their health insurance, and 9,000 saw their 
homes go into mortgage foreclosure. Oh, it isn't just another bad day 
in America, it is a pattern that has developed since we were told last 
September what was happening to our economy.
  There are those on the other side who say the best thing, in light of 
this economic situation, is to do nothing. I am not one of them. As 
badly and poorly managed as those funds were--the first $350 billion--I 
happen to be one of those people, one of those voters, and one of those 
Senators who said to America: Give us a new leader, give a new team a 
chance to change this country. A majority of the American people said 
that is the right thing to do, and they elected Barack Obama and Joe 
Biden. They are asking for this money not to use it the wrong way, the 
old way, an imperfect way, but to use it with transparency so that the 
American people can see what is being done to stabilize this economy, 
to stop this hemorrhaging of jobs, to create some credit

[[Page S585]]

so that businesses can survive, and to inject perhaps hundreds of 
billions of dollars into mortgage foreclosure so that people can stay 
in their homes and the real estate market bottoms out.
  Listen, if we don't do that, this is going to go from bad to worse, 
and 17,000 jobs a day lost in America could double--yes, it could--by 
doing nothing. And those who vote yes on this are standing for that 
premise: Do nothing. Don't trust this new President. Don't trust this 
new administration. Just wait, things are bound to get better.
  I am not one of them. I want to give President Obama the tools he 
needs to breathe life back into this economy, to give working families 
a fighting chance, to create good-paying jobs in this country, to give 
small businesses a chance to survive, to provide a decent income and 
some benefits for their workers, and maybe to preserve some basic 
industry in this country so there still are manufacturing jobs in 
America. We can't achieve that by doing nothing.
  As badly as this money has been managed--the first $350 billion--we 
have to look forward. Some of the people who managed the first $350 
billion could not imagine an America without the giants, such as 
Goldman Sachs. I can't imagine America without our middle class, 
without working families, who really form the basis, the bedrock, the 
foundation for the growth of our economy and the growth of our 
  I am going to be voting with the faith that this new administration, 
with new leadership and new eyes and new vision and new values, will 
invest this money properly so that we can turn this economy around and 
build a strong American future.
  Madam President, I yield the floor, and I reserve the remainder of my 
  The PRESIDING OFFICER. The Senator from Louisiana is recognized.
  Mr. VITTER. Madam President, as the distinguished Senator from 
Illinois said, this election was supposed to be about change. Yet his 
speech is eerily reminiscent. It is exactly the same speech that was 
given on behalf of giving the Bush Administration a blank check a few 
months ago. It seems to me absolutely nothing has changed.
  A few months ago, we were told we are in a crisis, you need to act, 
you can't wait. You need to act immediately, and you need to give us 
unfettered discretion. The times demand that. Trust us.
  Well, several months later, we have seen the result of that open 
checkbook, that unfettered discretion, that broad-based trust without 
any parameters, without any meaningful protection in writing. There has 
been mistake after mistake and embarrassment after embarrassment and a 
complete lack of accountability in the TARP. Yet here we are again 
today debating the second half of this huge $700 billion program.
  Even though we supposedly conducted a historic election based on the 
theme of change, it is exactly the same speech: We are in a crisis; we 
can't wait; we need to rush to judgment; give us an open checkbook; 
give us unfettered discretion; and trust us. Well, there is an old 
expression: Fool me once, shame on you; fool me twice, shame on me. The 
American people are not going to be fooled twice. The question is, Is 
the Senate going to be fooled twice?
  An open checkbook, unfettered discretion, and ``trust us'' simply 
isn't good enough. I am not questioning the sincerity of anyone either 
in the Bush Administration or the incoming Obama Administration. But it 
isn't good enough with $700 billion of taxpayer funds, particularly 
given the history of the last several months.
  One of the major protections that was put in the original legislation 
that was much ballyhooed was the Congressional Oversight Panel. That 
Congressional Oversight Panel was supposed to track what was done in 
the TARP, issue reports, and demand accountability. Well, they have 
done their job and they have issued a significant report. The problem 
is, the report makes crystal clear there is no accountability.
  The first main issue the Congressional Oversight Panel examined was 
bank accountability: What are banks doing with the money? Are they 
using the money in a way that was intended, particularly to increase 
credit availability to citizens and businesses? The Congressional 
Oversight Panel's bottom-line conclusion on that is pretty simply 

       The panel still does not know what the banks are doing with 
     taxpayer money.

  It couldn't be stated more clearly. The Treasury doesn't know, the 
oversight panel doesn't know, nobody knows.
  The Associated Press, on December 22, issued a report about an 
investigation of 21 banks and what they were doing. They mostly didn't 
get any answers, but Morgan Chase, which received $25 billion, gave 
this detailed, sophisticated answer:

       We have lent some of it, we have not lent some of it. We 
     have not given any accounting of saying here is how we are 
     doing it.

  Period. In fact, Treasury has the authority to require banks to 
report on their use of funds as a condition for the receiving of funds. 
Guess what. Treasury declined to make that requirement.
  Point No. 2 of the report: transparency and asset evaluation. TARP 
was, in large part, to shore up healthy banks. Yet there is no metric, 
there is no rule written anywhere about how Treasury is determining 
what a healthy bank is.
  Point No. 3: general strategy. TARP has been a moving target. The 
whole model has changed week to week. In fact, we still call it TARP--
the Troubled Asset Relief Program--but that idea was thrown out the 
window 2 weeks after Congress originally passed the program. So the 
Congressional Oversight Panel had another basic question: What is the 
general strategy as to how you are going to stabilize the economy? What 
are you focused on? Why should that be the focus? And rather than 
providing any detailed explanation, Treasury's explanation was that 
they are working to ``stabilize the economy.'' Well, that is a lot of 
detail. That is accountability. That makes me feel better.
  This has been the history of the TARP, and the question is, Are we 
going to allow it to remain the history and move on to the second $350 
billion of taxpayer funds?
  I am not a banking or financial expert and I do not own a crystal 
ball. I can't see into the future. I can't predict what crises will or 
will not occur in the economy. And I am not saying this economy is 
turning the corner and is improving and we don't have many challenges 
ahead. But I can predict this: If we don't pass this resolution of 
disapproval, nothing will change in the TARP. There will continue to be 
no accountability, the whole program will change its focus from week to 
week, and we will waste a huge amount of that $700 billion of taxpayer 
  Again, we come back to where we were just a few months ago: We are in 
a crisis; you have to act; you can't even wait until tomorrow; you have 
to pass this blank check; unfettered authority; trust us.
  Even with an intervening election that was supposed to be about 
change, the question remains: Are we going to change or not? Are we 
going to go down precisely the same path? The American people had 
serious questions and concerns the first time around. If we accept that 
speech again--oh, we are in a crisis; you need to act immediately; open 
checkbook; unfettered discretion; trust us--if we buy that the second 
time around, they are not going to be perturbed, they are going to go 
through the roof, and so they should because they have good old-
fashioned American common sense. They will say, ``Fool me once, shame 
on you; fool me twice, shame on me.''
  That is what we face here in the Senate. We must demand a clearly 
defined program. We must demand real accountability. We must demand 
real protections for the taxpayer. And the only way we will get any of 
that, any of it, is to pass this disapproval resolution and demand that 
be put in statute, in law, and not simply be a passing promise.
  I urge all my colleagues not to be fooled again, to stand up for real 
accountability, to stand up for the taxpayer, and, yes, to be ready to 
act in uncertain times but to say no to an open checkbook, to 
unfettered discretion, and to mere promises that things will be better 
and mere pleas to trust us.
  Madam President, I understand the majority leader is coming to speak 

[[Page S586]]

the other side, so I will retain the floor until then.
  Madam President, again, to me, that is the question. It is not about 
whether you think the economy is healthy--put me down for an unhealthy 
economy. It is not about whether we think there are rosy times ahead or 
there may be serious problems. Put me down for there may well be very 
serious problems. In fact, put me down for there are going to be, we 
just don't know precisely what they are going to be.

  But that does not justify what we have before us. That does not 
justify an open checkbook, unfettered discretion, and mere acceptance 
of promises and pleas to trust us.
  The American people are demanding something far more than that, and 
they deserve something far more than that. The question is, Is anything 
going to change? After 2 years of debates about change, the question 
is, Is anything going to change? Continuing down this path to the 
second half of the TARP program would represent a complete lack of 
change. It would represent complete continuity between one 
administration and the next. It would represent complete continuity 
between one Wall Street Treasury Secretary and the next, complete 
continuity between mere promises and pleas to trust us, and nothing 
more than that.
  Put me down for wanting change. Put me down for demanding change. 
This is the time and the place to do it. Obviously, change in this 
program can only occur if we pass this disapproval resolution. Change 
will never occur if we defeat it because then the new administration 
will have a blank check, it will have unfettered discretion, it will 
have our answer to ``trust us''--Sure, why not? When any administration 
has that, they are not going to restrict themselves, they are not going 
to put more rules in place, they are not going to tie their own hands. 
By definition, any administration wants to maximize that unfettered 
discretion, that open checkbook. The question is, Are we going to not 
demand change and give them that? Or make change happen right here, 
right now, with regard to this central new program, in terms of our 
struggling economy?
  Madam President, I ask unanimous consent to have printed in the 
Record this two-page letter from 26 broad-based economic, financial, 
and other citizen groups from around the country, requesting in very 
clear, strong terms our passage of the TARP disapproval resolution.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

    An Open Letter to the United States Congress Requesting a TARP 
                         Disapproval Resolution

                                                 January 15, 2009.
     U.S. Congress,
     Washington, DC.
       Dear Member of Congress: On behalf of the millions of 
     taxpaying citizens represented by the public interest 
     organizations below, we write to strongly encourage you to 
     swiftly pass a notice of disapproval on releasing the 
     remaining $350 billion in Troubled Asset Relief Program 
     (TARP) funds.
       From the beginning, the TARP plan was questionable, but a 
     number of Members nonetheless resolved to support it. It 
     should be clear now that this was a mistake.
       The stated purpose of the TARP was to purchase toxic 
     mortgage assets. Secretary Paulson abandoned this concept 
     immediately after the signing ceremony. The TARP was also 
     designed to reintroduce the flow of credit into the market 
     and help stabilize Wall Street. To date, neither has been 
       In addition to misleading Congress about his intent on the 
     use of TARP funds, Secretary Paulson has invaded the free 
     market, propping up some companies to the detriment of others 
     and purchasing stock in banks without requiring 
     accountability or transparency about the use of taxpayer 
       The TARP legislation specifically requires that before the 
     second half of the $700 billion is released, the President 
     provide Congress with a written report detailing how the 
     additional funds are to be used. A request to spend the 
     second half of the funds without restraint does not meet the 
     requirements set forth in the bill. In addition to requiring 
     this detailed plan, Congress should require an accounting and 
     detailed explanation on how the initial TARP funds have been 
     used and the prospect of a taxpayer recovery of these funds.
       Congress now has an opportunity to preserve some of the 
     taxpayers' assets and should spend the necessary time 
     studying the underlying causes of the economic down-turn by 
     passing a TARP disapproval resolution. We encourage you to 
     take such action.
         African American Republican Leadership Council, Alex-St. 
           James, Chairman; American Shareholders Association, 
           Ryan Ellis, Executive Director; Americans for Limited 
           Government, William Wilson, President; Americans for 
           Tax Reform, Grover Norquist, President; Americans for 
           the Preservation of Liberty, Mark Chmura, Executive 
           Director; America's Survival, Inc., Cliff Kincaid, 
           President; Center for Fiscal Accountability, Sandra 
           Fabry, Executive Director; Center for Investors and 
           Entrepreneurs, John Berlau, Director; Citizens United, 
           David N. Bossie, President; Coalition for a 
           Conservative Majority, Ken Blackwell, Chairman; 
           Competitive Enterprise Institute, Fred L. Smith, Jr., 
           President; Council for America, Ron Pearson, President; 
           Council for Citizens Against Government Waste, Thomas 
           Schatz, President; Family Research Council, Thomas 
           McClusky, VP for Government Affairs; Federal 
           Intercessors, Mark Williamson, President and Founder; 
           Free Market Foundation, Kelly Shackelford, Esq., 
           President; FRC Action, Connie Mackey, Senior VP; 
           Maryland Center-Right Coalition, Richard W. C. Falknor, 
           Chairman; Minuteman Civil Defense Corps., Carmen 
           Mercer, Vice President; Minuteman Foundation, Carmen 
           Mercer, President; National Center for Public Policy 
           Research, Amy Ridenour, Chairman; National Taxpayers 
           Union, Duane Parde, President; RedState.com, Erick 
           Erickson, Editor; RightMarch.com, Dr. William Greene, 
           President; The Flash Report Website on CA Politics, Jon 
           Fleischman, Founder; The Inspiration Networks, Ron 
           Shuping, Executive VP of Programming.

  Mr. VITTER. Madam President, with the arrival of the majority leader, 
I yield back my time.
  The PRESIDING OFFICER. The majority leader is recognized.
  Mr. REID. Madam President, it is in times of unusual strain and 
challenge that we are called upon to prove ourselves, as people, as 
Senators, as a country. With our economy struggling and the American 
people suffering, most Senators have risen to the challenge.
  I would like to take a minute, though, to particularly speak of 
Senator Chris Dodd, Chairman Dodd of the Banking Committee. He and his 
staff spent seemingly endless days and nights, working on the rescue 
plan we passed last year. We thought that would be all for a while. But 
now that we are in this state of crisis again, Senator Dodd is the face 
and voice of our response to this financial crisis. I have such 
admiration and respect for Senator Dodd as one of the fine orators of 
the Senate, and that is something everyone sees. But what we do not see 
is his skill as a legislator, behind doors, in his committee and 
working with us. And he has done a great job working with Senator 
Shelby. They don't always also agree, but they treat each other 
civilly, and they set the standard for the rest of us. Senator Dodd is 
to be recognized, as I do, for yeoman's work on this legislation.
  On the Republican side, it is important to focus on Senator Judd 
Gregg. He deserves enormous credit as well during these last few weeks, 
working on this extension of Troubled Asset Relief Program.
  I have been tremendously impressed with President-elect Obama. As his 
campaign wore on--and it was a long campaign--the American people came 
to realize this was a unique individual, somebody extremely brilliant 
academically, someone who could communicate very well, and someone who 
worked hard and developed the trust of the American people. I have been 
impressed with his campaign but also with his team and their efforts to 
secure the second half of the Troubled Asset Relief Program, or TARP. 
If the actions of the President-elect on TARP are any indication, a new 
day is dawning in Washington, DC, and a good day, a bright day.
  President-elect Obama didn't have to take the step he did. This was a 
test of leadership at a time when leadership is desperately needed in 
our country. In this early test whether our new President will stand 
for what is right, not just for what is easy, President-elect Obama 
passed with flying colors. He and his economic team came to Capitol 
Hill repeatedly these past weeks, not just for a photo opportunity but 
to engage in real negotiations. The Obama administration generally 
sought the involvement of Democrats and Republicans, treating them not 
as adversaries or roadblocks to progress but as partners in the 
legislative process.

[[Page S587]]

  I appreciate the willingness of Republicans to work with him and to 
work with us to pass this legislation. I do not know how many votes we 
are going to get from the Republicans, but we will get some votes and 
every one of them is needed and I appreciate that.
  I understand the legitimate concerns of Members over the way the 
first half of the Troubled Asset Relief Program funds have been spent. 
We in Congress must never forget the funds we allocate to this program 
belong to the American taxpayers. It is not our money, it is their 
money, and we must wisely spend and carefully account for every penny, 
as every family would, to plan their budget to make the current 
paycheck last until the next paycheck that they hope comes in.
  We need transparency, we need openness, we need oversight. With our 
economy battered and further damage possibly still to come, we must 
give our new President every tool to try to fix this economy. Barack 
Obama has made it clear that he understands the mistakes of the prior 
administration and will not repeat them. President-elect Obama has, in 
person and in written communications, agreed to commit substantial 
resources to foreclosure mitigation, as he should.
  Barack Obama has also said there will be transparency, there will be 
oversight, and Barack Obama has said the disbursal of TARP funds will 
require his signoff; not a Secretary, not somebody in some clerk's 
office, not a group of people, but every penny will require Barack 
Obama's personal signoff.
  This vote is going to be close. As many of my colleagues decide how 
to vote, I ask them to think about the challenges our freezing 
financial markets are causing their constituents. It doesn't matter if 
it is Minnesota or Nevada or Arizona or New Hampshire, without 
financial markets that are functional, families cannot buy a home, 
borrow to pay for college tuition, replace the family car or simply 
decide what they are going to do this weekend, because they have no 
money. Businesses of all sizes cannot make payroll for employees or 
invest in expansion to create new jobs. That is what this vote is all 
about. This vote is about local governments not being able to build 
schools but, instead, lay off teachers, lay off police officers. They 
are trying to pave roads and protect the public health of their 
  We should all be angry at the titans of Wall Street, angry because of 
their excesses. But inaction now would not punish the wrongdoer, it 
would punish the American people who are already suffering.
  None of us, me included, are happy we have to take this vote. I wish 
we didn't have to. But given the potentially devastating alternative, I 
trust my colleagues will act with sound judgment and for the long-term 
good of our country and in this moment of crisis.
  This is one of those rare times. I voted thousands and thousands of 
times, but over the years I have been here since 1982, there are 
probably only 15 or 20 votes that are memorable. This is a memorable 
vote. I believe this is the road to recovery for our country.
  Let's trust Barack Obama. I look back at a book I read called ``The 
Master of the Senate.'' It was about Lyndon Johnson. There is a chapter 
in that book that I think is so revealing as to today. Lyndon Johnson 
became the Democratic leader. The President of the United States at 
that time was Dwight Eisenhower. Dwight Eisenhower was the most popular 
President in the history of the country. Over an 8-year period of time, 
his popularity averaged 65 percent--over 8 years. So Lyndon Johnson 
said: I think what the guy is trying to do is the right thing so I am 
going to get as many of my Senators as I can, all my Democratic 
Senators, to join with Dwight Eisenhower to accomplish what he thinks 
should be accomplished.
  I ask my Republican colleagues, look at Barack Obama since he has 
been elected. Has he set a pattern for moderation? Has he set a pattern 
for people coming into his Cabinet who are good no matter their party? 
The answer is yes. The American people are impressed with what he has 
tried to do to move this country forward. I ask my friends to reflect 
back to Dwight Eisenhower, to look now to Barack Obama. This is the 
time we need to move forward as Democrats and Republicans, as 
Americans, and do what is right. I believe this is one of those votes 
historians are going to record as important. I think, when some of 
those chapters are written in that book, they are going to say this is 
the beginning of the economic recovery for our country.
  Madam President, is there time remaining?
  The PRESIDING OFFICER. There is 3 minutes remaining.
  Mr. REID. I yield that back and start the vote now. We will extend 
it, if necessary.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second? There appears to 
be a sufficient second.
  The clerk will read the joint resolution for the third time.
  The joint resolution (S.J. Res. 5) was ordered to be engrossed for a 
third reading and was read the third time.
  The PRESIDING OFFICER. The joint resolution having been read the 
third time, the question is, Shall it pass?
  The yeas and nays have been ordered.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. HATCH. (After his name was called) Mr. President, on this vote, 
Senator Kennedy is absent. If he were present, he would have voted nay. 
If I were to vote, I would vote yea. Therefore, I withhold my vote.
  Mr. TESTER. (After his name was called) Mr. President, on this vote, 
I have a pair with the Senator from Ohio, Mr. Brown. If he were present 
and voting, he would vote nay. If I were permitted to vote, I would 
vote yea. I, therefore, withhold my vote.
  Mr. DURBIN. I announce that the Senator from Massachusetts (Mr. 
Kennedy) is necessarily absent.
  Mr. KYL. The following Senator is necessarily absent: the Senator 
from Kentucky (Mr. Bunning).
  Further, if present and voting, the Senator from Kentucky (Mr. 
Bunning) would have voted ``yea.''
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 42, nays 52, as follows:

                       [Rollcall Vote No. 5 Leg.]


     Nelson (NE)


     Nelson (FL)
     Udall (CO)
     Udall (NM)


     Hatch, yea
     Tester, yea

                             NOT VOTING--3

  The joint resolution was rejected.
  Mr. DURBIN. I move to reconsider the vote.
  Mrs. McCASKILL. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. ALEXANDER. Mr. President, I voted today the same way I did in 
October because both the current President and the incoming President 
have said this is an essential insurance policy against financial 
catastrophe. This is not spending; this is lending money with interest 
that taxpayers should get back. I would not have voted this way if 
President-elect Obama had not assured us that he will use this money as 
it was intended: to keep credit flowing by strengthening financial 
institutions and housing markets, and not for new industry-by-industry 
  The PRESIDING OFFICER. The majority leader is recognized.

[[Page S588]]