[Congressional Record Volume 155, Number 186 (Friday, December 11, 2009)]
[Extensions of Remarks]
[Page E2977]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


         WALL STREET REFORM AND CONSUMER PROTECTION ACT OF 2009

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                               speech of

                            HON. TODD TIAHRT

                               of kansas

                    in the house of representatives

                      Wednesday, December 9, 2009

       The House in Committee of the Whole House on the State of 
     the Union had under consideration the bill (H.R. 4173) to 
     provide for financial regulatory reform, to protect consumers 
     and investors, to enhance Federal understanding of insurance 
     issues, to regulate the over-the-counter derivatives markets, 
     and for other purposes:

  Mr. TIAHRT. Madam Chair, on June 30, 2009, the Obama Administration 
released details of its proposal to establish a Consumer Financial 
Protection Agency as an independent agency in the executive branch to 
regulate the provision of financial products and services to consumers. 
Five months later, Congressman Frank, Chairman of the House Financial 
Services Committee, has turned this proposal into a 1,300-page bill 
that further extends the federal government's hands into more aspects 
of our economy.
  I oppose this legislation for several reasons. One, it will 
permanently extend the Troubled Assets Relief Program (TARP)--something 
that I've been actively trying to end. I recently introduced 
legislation that will effectively end TARP by eliminating the Treasury 
Secretary's authority to utilize this program. This bill also creates 
another czar--a Credit Czar. This unelected official is granted the 
authority to restrict access to credit and impose taxes on consumers 
and small businesses.
  These reforms will continue to perpetuate the bailout mentality that 
has plagued our Nation and eliminate access to credit for many small 
businesses and families at a time when they need it most.
  One of the most troubling aspects of this bill is the vague, 
subjective standards that nonfinancial companies must meet. One such 
example of the bill's vagueness is found in the definition of 
businesses that engage in ``financial activities'' and those that pose 
a ``systematic risk'' to the stability of the financial market.
  A business that engages in ``financial activities,'' is now subject 
to increased regulations and fees. Exactly who comes under this 
definition, however, is not that clear. Maybe this will fall under the 
new ``Credit Czar's'' job description. Nonetheless, this bill will 
drastically affect businesses, specifically non-financial businesses 
that had no part in the irresponsible decisions that lead to the market 
collapse in 2008.
  Vague definitions expose non-financial businesses that utilize the 
commodity and derivatives markets to manage risk and plan for the 
future. These markets, which date from the 1980s, involve hedgers. 
Hedgers, producers or commercial users of commodities, trade in futures 
to offset price risk. They use the markets to lock in today's price for 
transactions that will occur in the future, shielding their businesses 
from unfavorable price changes.
  This bill restricts the use of these practical business tools. These 
practical tools encourage job creation and provide customized hedges to 
help businesses like farmers, grocery stores and energy companies to 
manage price volatility, so that retail prices can remain low and 
stable. Yet H.R. 4173 authorizes government regulators to arbitrarily 
impose capital and margin requirements for ``over the counter'' (OTC) 
derivatives, and impose new capital requirements for cleared swaps, 
which would lead to increased retail prices and make it less likely 
that corporations could engage in responsible risk management.
  Companies that utilize these markets to shield themselves from future 
risk and uncertainty in the energy markets should not be penalized for 
planning ahead. Unless the definition of ``financial activities'' and 
others like it are changed, companies who have not contributed to the 
market collapse will be required to shell out large sums of money as 
security for increased regulations. This will no doubt drive up 
operational costs and increase the price of energy.
  In the midst of continuing economic turmoil, this bill increases the 
size of government, expands its reach in the marketplace, jeopardizes 
the safety and soundness of many of America's financial companies and 
non-financial companies, and significantly increases the cost of credit 
for all consumers at a time when consumers can least afford it.
  For the above reasons, I am opposed to this bill. I encourage my 
colleagues to vote no.

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