[Congressional Record Volume 156, Number 28 (Tuesday, March 2, 2010)]
[House]
[Pages H1011-H1017]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         BLUEPRINT FOR RECOVERY

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 6, 2009, the gentleman from Iowa (Mr. Braley) is recognized for 
60 minutes as the designee of the majority leader.
  Mr. BRALEY of Iowa. Mr. Speaker, I was very proud to found the 
Populist Caucus with a large group of my friends in the Democratic 
Caucus to focus on economic issues that affect Americans who either 
make up the middle class or are striving to enter the middle class. We 
all know that our country has historically been at its best when we 
have had a large middle class and our economic policies reflect middle 
class values, and that is why when we decided to settle upon our 
founding principles, we decided that we wanted to fight for families by 
providing them access to quality, affordable health care; to provide 
them and their children with the type of world class education they 
will need to compete in a global economy; to make sure that we have a 
fair wage system for all employees in this country; to make sure that 
our trade policies provide a level playing field to American workers 
and American manufacturers who compete with trading partners who just 
frankly don't quite live up to our standards, whether it is child 
labor, exploitation of workers, environmental issues, those are the 
types of issues that we want to focus on as we chart a new future for 
this country to promote and expand the middle class that we all are so 
proud to have been a part of.
  One of the things that we talked about as we were trying to dig 
ourselves out of the greatest economic crisis since the Great 
Depression was what type of a blueprint for recovery we wanted to offer 
to the American people that was going to be a reflection of the values 
that we grew up with and give a strong message that, after a bailing 
out Wall Street, the American taxpayers deserved help on Main Street, 
and that it was not unreasonable to ask the very people on Wall Street 
who got us into this mess to help pay for the tab on helping bail out 
Main Street.
  I am proud to be joined by my friends, the gentlewoman from Ohio (Ms. 
Sutton) and the gentleman from Wisconsin (Mr. Kagen), but one of the 
things that I want to talk about at the beginning is the things that we 
hear over and over back in our district, because all of us have been 
out talking to our constituents, going to town hall meetings, Congress 
on Your Corner and the other events, and the one thing I hear from my 
constituents over and over is this question: When do I get my bailout?
  This is a legitimate question that Americans deserve an answer to 
from Democrats and Republicans, because if you are somebody who has 
lost your job or you've lost your home or you've lost your business or 
you've lost your health care coverage during this crisis, you need to 
know what is my Federal Government doing to help me out. So when we 
talk about our response, we are going to do it by talking about these 
three core values: The Populist Caucus wants to find a blueprint for 
recovery that is going to spur job creation; it is going to implement 
fair compensation for executives who helped put us in this problem; 
and, finally, bring an end to excessive Wall Street speculation that 
drove our economy and drove the global economy off the cliff and put us 
into this deep hole that we have been digging ourselves out of.
  So as millions of middle class families look to us and ask when their 
recovery effort will bring relief to their town on their street, they 
deserve to know what we are going to be doing to spur job creation, 
insist on fair executive compensation, and end speculation on Wall 
Street.
  Now, one of the things that we know is that it is very common for 
politicians and groups across the political spectrum to try to claim 
the populist mantle. But let me tell you, and I am going to let my 
colleagues expand on this, the Populist Caucus that we all came 
together to found was not based upon a bunch of people running through 
the streets with torches and pitchforks asking for blood. We are there 
because the problems of the middle class are real. The concerns of our 
constituents reflect the concerns of America, and we want to come 
together and talk about serious answers to real problems to help change 
the lives of middle class Americans.
  So with that, I am going to yield to my colleague from Ohio before I 
yield to my colleague from Wisconsin to talk about some of the critical 
economic issues she is hearing about from her constituents and why this 
Populist Caucus response is so critical moving forward.
  Ms. SUTTON. I thank the gentleman for yielding, and for your strong 
leadership of the Populist Caucus and the mission that we are on to 
restore the promise of the middle class, to stand up for the middle 
class, and to stand up for those who aspire to the middle class, to 
make our country work for those folks who are aspiring to the middle 
class.
  We are not something that is complicated. The Populist Caucus 
believes that strong, immediate action must be taken to create jobs in 
the United States and to put an end to the excessive greed of Wall 
Street that brought us to the brink of disaster. And so I am proud to 
join with you, Representative Braley and Representative Kagen, to stand 
up and speak to the American people about the fight we are waging on 
their behalf because that's what being a populist is really about.
  When I go home, as when you go home, I hear all about the need to 
facilitate employment opportunity for the people that I represent in 
northeast Ohio. All they want is a government that will work with them 
and for them, to facilitate those jobs, jobs, jobs that are so needed 
out there. We have heard recently that there is a recovery underway, 
and there are some signs of recovery, and we have certainly seen a lot 
of signs of recovery on Wall Street, but there can be no such thing as 
a jobless recovery, and we have started to hear that term bounced 
about.
  The Populist Caucus is here to say that there is no recovery if our 
folks

[[Page H1012]]

don't have jobs, because this is not just about a country that stands 
up for the well-to-do. This is the People's House. This body is about 
making sure people have opportunity, ordinary people have opportunity. 
And what we will discuss, and when we look back a little bit, it 
becomes apparent that the economy, even before the excesses of Wall 
Street came to their full fruition, even before the economy was not 
working for ordinary Americans, we saw a decade of flat wages in this 
country while we continued to see skyrocketing health care costs. We 
saw the GDP rise, and we saw productivity rise in this country, but the 
American people who were doing the work were not sharing in the 
prosperity.

                              {time}  2100

  So we look forward to developing policies--and that's what the 
blueprint is all about--that will help deliver sustainable, quality 
jobs for the American people that will fairly compensate them and put 
an end to the excessive and disparate compensation that those at the 
top of the food chain have been taking for far too many years at the 
expense of everyone else.
  And so with that, I yield back to the gentleman. And I thank you 
again for your leadership; it's been stellar on this subject. I look 
forward to the mission ahead.
  Mr. BRALEY of Iowa. I thank the gentlewoman for yielding.
  I think one of the things that we've heard a lot about, Dr. Kagen, is 
we've heard people try to explain what went wrong on Wall Street and 
this concept that sometimes big financial institutions are just too big 
to fail. Now, I don't know how it is up in northeastern Wisconsin; but 
in Iowa, if something is too big to fail, it's just too big. So maybe 
you can help enlighten us a little bit about some of the economic 
policies that we pursued as a country before Barack Obama became 
President that have contributed to the enormous challenge we have faced 
this past year in trying to stabilize the economy before we moved on to 
a broader response to real meaningful financial reform.
  Mr. KAGEN. I thank the gentleman for yielding and for putting 
together the Populist Caucus.
  Once again, as Mr. Braley has pointed out, we're populists because we 
are standing with our feet on the factory floor. We don't have our 
heads sitting in a board room on a corporation on Wall Street. We do 
not share their values. We have those working class values that 
ordinary people have.
  This battle that we're in now, this battle for America's future to 
create the jobs that we need to work our way through today's troubled 
times and work our way back into prosperity, this battle that we're in 
didn't just start 10 years ago, it just didn't begin with 10 years of 
net zero job creation. I will take us back a century because it's 
really not 2010, it's 1910 all over again. In the words of Teddy 
Roosevelt, who, on August 31, 1910, in his speech entitled, ``The New 
Nationalism,'' set forward the idea of the progressive movement and the 
Populist Caucus--and I will quote him in part because it was a very 
long speech:
  ``Exactly as the special interests of cotton and slavery threatened 
our political integrity before the Civil War, so now the great special 
business interests too often control and corrupt the men and methods of 
government for their own profit. We must drive the special interests 
out of politics; that is one of our tasks today. Every special interest 
is entitled to justice, full, fair and complete. And now mind you, if 
there were any attempt by mob violence to plunder and work harm to the 
special interests, whatever it may be, that I most dislike. And the 
wealthy man, whomsoever he may be, for whom I have the greatest 
contempt, I would fight for him, and you would if you were worth your 
salt. He should have justice, for every special interest is entitled to 
justice, but not one is entitled to a vote in Congress, to a voice on 
the bench, or to representation in any public office. The Constitution 
guarantees protection to property, and we must make that promise good; 
but it does not give the right of suffrage to any corporation.'' We the 
people have rights, corporations don't.
  Now, over the short period of history that we've been here in 
Congress, beginning in 2006, with Representatives Sutton and Braley and 
Welch, we took forward some ideas that we gathered from people. And 
everywhere I go in Wisconsin, Mr. Braley, people are telling me the 
same thing: We want our money back, we want our jobs back. For too 
long, our jobs have been shipped overseas. Instead of our values being 
shipped overseas, it's been our jobs. And here on my left is a short 
picture of where the jobs have gone.
  During the previous administration under George Bush, just before 
President Obama came into office in January, we had lost 700,000-plus 
jobs; this January, 2010, 20,000. We are moving up in the right 
direction. And, yes, we need to generate more jobs, but how did we get 
into this mess that started really back in 1910 and we're not done yet? 
We've had two wars at the same time without paying a dime for it; we've 
had two tax cuts to the rich without paying for a penny; we've had a 
$400 billion handout to the big drug companies on Wall Street without 
paying a nickel for it. And then at the tail end of the last 
administration we had a looting of the United States Treasury of nearly 
$1 trillion while they fed their friends on Wall Street, again, without 
paying a single dime for it. Well, in Wisconsin, much like in Ohio and 
everywhere else across the country, including Iowa, we have a saying, 
you know, there is no free lunch, we have to pay our bills.
  So we have to pay our bills, we have to live within our means; and to 
do that, the Populist Caucus has put forward a blueprint for America's 
future, and I yield back my time.
  Mr. BRALEY of Iowa. Well, that's a great segue because we not only 
are talking about values; we are talking about solutions. We're talking 
about legislation that is going to help us create jobs by generating 
new revenues, not putting this on the back of the middle class, but 
helping the people who got us into this mess assume some of the 
responsibility. And I think one of the cornerstones of our blueprint 
for recovery is this issue of fair compensation. And my good friend 
from Vermont, Congressman Peter Welch, has introduced a bill called 
Wall Street Bonus Tax Act. I am going to let him explain what that bill 
does and how it helps achieve this blueprint for recovery by putting 
some incentives for Wall Street to help rebuild Main Street.
  Congressman Welch, I yield to you at this time.
  Mr. WELCH. Thank you very much. I appreciate the opportunity to speak 
about trying to get jobs to start going up along with the stock market.
  You know, it was only 1 year ago in one week that Wall Street, the 
stock market was crashed to its lowest level in years. In that past 
year, it has recovered; but while it has recovered, unemployment is 
still hovering in the range of 10 percent, underemployment is in the 
range of 17 or 18 percent. There are over 27 million Americans who are 
seeking work or not working enough, and we are not going to have an 
economic recovery until those folks are back to work.

  How did this happen? It happened, we know, because of the excessive 
lending, reckless lending largely engineered by Wall Street firms that 
stood to gain an awful lot of profit. What happened? We, the American 
taxpayer, had to bail out Wall Street, $750 billion. People didn't want 
to do it, but they had a gun to the head of the American economy, and 
the collateral damage of inaction would have been much more havoc to 
people's pensions, to unemployment, and to Main Street. But 1 year 
later, Wall Street is back, but lending by Wall Street to our small 
businesses has gone down, not up. If we are going to get jobs back, if 
we are going to get people back to work, we need our banks--and it 
tends to be our local banks--to start doing some lending. They have 
been doing the job, but Wall Street hasn't.
  What they've been doing in the past year--and quite successfully, 
they're very good at it--is returning to the casino economy. They've 
made an enormous amount of money by buying and selling derivatives, 
commodities, and currencies. And how did they do it? With the help of 
the American taxpayer: one, the $750 billion TARP transfer; second, the 
open window at the Federal Reserve where those banks had access to 0 
percent interest money. Now, they've been so successful that they have 
set aside this past year for their bonus pool $150 billion.

[[Page H1013]]

  They had three choices as to what they could do with that money: one, 
they could have added it to their balance sheets, strengthened it in 
order to basically fight another day so that if there was a downturn, 
they would be able to absorb it themselves and not come hat in hand to 
the taxpayer. Second, they could have lent it out. If you're getting 0 
percent interest money from the Fed, you've got a local small business 
or a young family trying to buy their first home and you lend it out at 
5 or 6 percent, most people would say that's a pretty good return. They 
didn't do that.
  The third thing that they could do--and unfortunately they did do--is 
decide to put that money in their pocket with a bonus. That's good for 
them, but it certainly hasn't been good for the American economy.
  So our legislation, the Wall Street Bonus Act, is very simple. It 
says that all those bonuses on Wall Street that went to banks that 
received taxpayer assistance through the TARP program, those bonuses 
above $50,000 would be taxed at 50 percent. And every single dollar 
that was collected would then be made available to the Small Business 
Administration to work with our local banks that have been making loans 
to lend to our job-creating small businesses around the country. So we 
would be taking a dividend for and on behalf of the taxpayers who 
basically put that money up in the first place, and we would be 
specifically making that money available for lending with a partnership 
of the SBA and our small banks.
  Now, this is important for a couple of reasons: number one, the money 
that was made on Wall Street, that $150 billion bonus pool, yes, it was 
smart people buying and selling and trading derivatives, but the 
question for us is, when we put taxpayer dollars to work, is it good 
for the American taxpayer? Is it good for the Main Street economy? And, 
obviously, if it just goes into the pockets of the Wall Street traders, 
it does a lot of good for them, but no good for our broad economy; and 
our fundamental responsibility is to help people get back to work.
  The second is that the bonus culture really is very destructive 
because what it encourages is placing a big bet, bet red, bet black, if 
you win, you make a lot of money, if you lose, as we've seen, the banks 
can come to the taxpayer and get bailed out. And people are furious 
about that, rightly so. So it is time for us to make a basic statement 
here that will reward investment, will reward hard work, but we're not 
going to have the taxpayers be on the hook for people who want to 
gamble.
  The final thing really is this: we face a question about what 
business model we want America to follow. Do we want a business model 
where you make money by financial engineering, by having the quickest 
computer trading program, by a lucky bet on a speculation? Or do we 
want a business model where folks make their money by showing up for 
work, by investing in their community, by hard work for the long term, 
by being satisfied with a steady and sustainable rate of return and 
profit--which we need in a capitalist economy--by treating their 
workers right and by paying our fair share? That's the question.
  The Populist Caucus is very strongly united in the view that hard 
work should be rewarded, that entrepreneurs, job creators, people who 
make money because they invest in their economy, because they invest in 
their workers, that is to be rewarded and encouraged. In fact, we have 
to do it if we're going to have an economy that works and expands 
rather than an economy that is based on flipping trades, about 
speculation, and financial engineering.

  So this Wall Street Bonus Act would put some money into lending and 
help our small entrepreneurs. And I am very grateful that we have the 
strong support of so many Members of Congress for this.
  I yield back.
  Mr. BRALEY of Iowa. Well, I thank you for those very insightful 
comments.
  I think everything that we talked about earlier on why we formed the 
Populist Caucus, to promote and expand the middle class by emphasizing 
economic principles, that will create policies that help that to 
happen. We know that small businesses make up a huge part of the middle 
class. We also know that they are a huge driving engine for creating 
new jobs in our economy.
  That is why I am happy to recognize my good friend from Florida, Ron 
Klein, who has been a strong advocate for small businesses during his 
time in Congress and is going to be sharing with us some of the things 
that we can work on together to try to create the types of incentives 
that will help small businesses take the risk with sound economic 
principles and lead us on a path of job recovery.
  With that, I would yield to my friend.
  Mr. KLEIN of Florida. Well, I thank the gentleman from Iowa. And as 
always, it's great to be here with our friends from the Midwest and 
from the South. We represent the whole country, and it's such a great 
thing to be here, as we all got elected a couple of years ago and we 
have learned and listened very closely to what people are saying back 
home.
  I know the gentleman from Wisconsin talked about jobs and sort of 
where we've come from, and I know the gentlelady from Ohio did the same 
thing. The ``where we've come from'' part didn't just start in the last 
13, 14 months; unfortunately, it has been going on for a long time. A 
lot of that was decisions made in some cases by government, sort of 
incentivizing big decisions to send business overseas, encourage that 
through tax policy, and some of it has just been people making 
decisions that we've lost that American ingenuity.
  Well, we haven't lost it, we all know that. This is the greatest 
country in the history of the world and our economy is the strongest. 
And, yes, we are being challenged right now, but this is when we are at 
our best. And that's the exciting part. This is a moment for us all to 
come together, put our arms around each other and say, what's great 
about America? Our worth ethic, our ingenuity, our technology, our 
innovation, this is what makes it. But we have to recognize that some 
of these policies--certainly when this administration started, a mere 
13 months ago, we were losing 720 jobs per month. That's incredible. 
Now we are in a place where fortunately it's moving in the right 
direction--I think it was 20,000 or 30,000 jobs per month. Now, that's 
not good, we want to gain, we want to be at 100,000-plus; but, boy, 
that is certainly moving in the right direction, and that is what I am 
glad to see.

                              {time}  2115

  Now, I come from a State, Florida, which had 15 years of incredible 
prosperity, a lot of growth. For the people in my community, their 
property values went up, and their businesses were expanding. All good. 
The American Dream was happening over and over and over again. Yet, 
when the banks stopped lending, as we've been talking about, well, 
guess what? The merry-go-round stopped, and a lot of people are hurting 
right now. They are hurting psychologically; they are hurting 
emotionally; they are hurting physically.
  The worst thing, as I know the gentlelady from Ohio talks about, is 
not to have that job, not to have that ability as a provider, a man or 
woman of a household, to bring that paycheck home, to get up in the 
morning and know you're going to do something productive and to make 
that example for your children. We want to make sure that people have 
that opportunity, and that's what we are working toward right now.
  Well, as to this ``spur job creation'' part of the Blueprint for 
Recovery, there are two points I want to bring up:
  One is the ``buy American'' concept. It's real simple. Every 
opportunity, when it comes to sourcing goods, services, and things like 
that, needs to be done in the United States. If there is anything that 
we can certainly promote, it's our providing those goods and services--
our local businesses. Your neighbor down the street, one you go to a 
church, to a synagogue, or to a supermarket with or one you coach 
Little League with is someone who works in the community. We want to 
give that businessperson and his or her employees or the people he 
works with an opportunity to be that source for government contracts 
and everything else--not to go overseas. We all understand the issue of 
free trade and all that, but free trade is fair trade, and

[[Page H1014]]

we want to make sure that, in this country, we are doing everything we 
can to promote our businesses first. It's real simple. I think most 
Americans get it. I think we've gotten a little off track over this 
thing, but that's a principle we need to pass and support and hold to.
  Second--
  Mr. BRALEY of Iowa. Will the gentleman yield on that?
  Mr. KLEIN of Florida. Absolutely.
  Mr. BRALEY of Iowa. I think there is a big misperception that our 
trading partners and our competitors in the global economy don't have 
any ``buy Chinese'' trade policies or ``buy Japan'' trade policies; is 
that true?
  Mr. KLEIN of Florida. Absolutely.
  We all understand the real game here, and it's not just about what 
they call ``tariffs.'' You may have heard of a ``tariff.'' That's a 
tax. If you bring something into a country, there is a tax to make it 
less competitive. Well, there are a lot of other ways to stop our 
wonderful American goods from going to other countries. They have lots 
of obstacles. It goes on in the auto industry all the time with 
emissions and lots of things that just make it practically impossible 
for us to sell.
  Now, we can't force someone in Korea to buy one of our cars, but we 
should give him that choice. If we have the best products, consumers 
will buy our products, just like some products come into this country, 
and consumers make a choice. Right now, there are a lot of things going 
on to stop our products from going to other countries.
  Mr. KAGEN. Will the gentleman yield for a question?
  Mr. KLEIN of Florida. Sure.
  Mr. KAGEN. In Wisconsin, we have got a number of companies which have 
run into problems with regard to ``buy American.'' We have buy American 
clauses in our government contracts today. Yet Miller Electric Company, 
which makes the finest welding apparatus in the world, put in a bid for 
a shipbuilding company, a government contract for the Navy. This 
foreign-owned shipbuilding corporation down in the South decided, 
instead of buying American, they would use a loophole, and they bought 
something from a competitor from Germany.
  Can you explain how this bill, this Buy American Improvement Act, 
would close the loopholes in these contracts?
  Mr. KLEIN of Florida. That's exactly what it will do. I thank the 
gentleman for that example.
  I have an example in my community, a company called Cross Match. It's 
a technology company. They make fingerprint equipment and things like 
that. They were bidding for a census contract, and a company that was 
sourcing it through a Korean company came in with all sorts of--not 
machinations--I would say, loopholes. This bill closes the loopholes, 
and I think that's exactly what we are all interested in.
  The second thing I want to touch on, if I can, which the gentleman 
from Iowa (Mr. Braley) just talked about, is something which, I think, 
we all understand--the lifeblood of our economy. That is access to 
capital, to bank loans--to small business loans.
  One thing I can say about this Congress is that I am really proud of 
the efforts that have been brought about through this Congress to make 
SBA, Small Business Administration, loans much easier to get. At this 
point, they are 90 percent guaranteed by the government. If you are a 
qualified veteran, 95 percent is guaranteed. These are good quality 
loans, but these aren't loans that are made by the government. They are 
made by banks, and they are guaranteed by the government.
  We need to get our banks to start focusing on making these loans and 
other commercial loans. We are not asking banks to make ridiculous 
loans like some of those that took place before which were not properly 
collateralized. Yet, for good, creditworthy people, there are loads of 
small businesses that have long histories in our local communities. 
They know the loan officers at the banks, and they can work together 
and make loans happen.
  One of the ideas being suggested is to take some of the payback money 
from some of the big banks that paid some of this money back and start 
bringing it down to the local level--to Main Street, to small banks, 
to community banks. We're not just talking about giving them the money 
like it happened before. Instead, it's an incentive to make the loans. 
If they make the loans, then they get discounts on the interest rates. 
This is what we have to do.

  Mr. BRALEY of Iowa. Will the gentleman yield for another question?
  Mr. KLEIN of Florida. Absolutely.
  Mr. BRALEY of Iowa. One of the things that is frustrating to many 
Americans is they just don't understand how their government can 
actually help stimulate economic development.
  One of the best examples of this is, when I first came to Congress, I 
served on the Small Business Committee. I was fortunate enough to chair 
the Contracting and Technology Subcommittee, and this is when the 
previous administration was in control of the executive branch. As I 
talked to people on the committee, it shocked me to learn that the 
former administrator of the Small Business Administration saw it as his 
job to bring about the end of the Small Business Administration. Many 
of the policies were designed to contract the agency whose sole purpose 
was to try to stimulate small business growth and development.
  So, when we are talking about how we create capital and provide 
economic incentives for small businesses, we have come a long way in 3 
years to get to the point where this agency is trying to fulfill its 
basic purpose, and I think that is going to be critical for achieving 
the types of results you've just talked about.
  I hope you can enlighten us further on this.
  Mr. KLEIN of Florida. I'll just conclude. There is so much more that 
everyone wants to say here, and there is so much to add. That's what's 
getting exciting about this work we're doing here.
  Small businesses are the lifeblood of our economy. I mean many parts 
of our country do not have a lot of Fortune 500 companies. Those are 
great companies, and they add a lot of value to our country, but small 
businesses are going to be the businesses that get us out of this 
downturn, and we are beginning to see some good things. Bank lending is 
better than it was, but we need to encourage and find ways to make sure 
that the banks are lending so our small businesses can buy up some 
inventory, can buy up that capital equipment they need--a little 
deferred maintenance--and hire more people. That's the bottom line.
  I just want to thank the gentleman for having this ``spur job 
creation'' because, I think, this is a huge part of how we are going to 
get our country back on track.
  Mr. BRALEY of Iowa. Well, I think one of the things we know is that, 
in order to spur job creation, you have got to be able to have revenues 
that will help people create jobs through incentives that will help 
them take that risk.
  One of the important things that the Populist Caucus' Blueprint for 
Recovery does is it talks not only about how you change behavior 
through the policies you implement but also how you transfer some of 
the burden from Main Street, which has been suffering so much in this 
recession, to the very speculators whose wild gambling, which is what 
most economists call what they were doing, drove us over the cliff.
  That is why one of the key elements of this ``ending speculation'' 
piece is one of the bills introduced by another vice Chair of the 
Populist Caucus, Congressman Peter DeFazio, who introduced his Let Wall 
Street Pay for the Restoration of Main Street Act. This is a very 
simple concept that existed in this country for almost 60 years, and it 
worked very successfully, including during the Great Depression.
  What it says is that, if you are trading in excessive transactions on 
Wall Street, we are going to ask you to pay a small transaction fee on 
those high-volume trades so that we will have an incentive to keep you 
from engaging in excessive speculation that puts all of us at risk. His 
transaction fee is estimated to create somewhere between $100 billion 
and $150 billion in new revenues that can be used for two basic 
purposes:
  One is job creation, which is what we all agree is going to create a 
huge emphasis for an economic recovery, because when people go back to 
work,

[[Page H1015]]

they not only pay Federal taxes and reduce our burden at the Federal 
Treasury; they pay State and local taxes, too, to help relieve the 
burden on our States and cities. This is how you create economic 
incentives to change corporate behavior from excessive speculation, and 
this is also how you provide new revenues to stimulate economic 
development and help to reduce the deficit.
  I am going to ask one of our newest members and youngest members of 
the Populist Caucus, our good friend from Virginia, Tom Perriello, to 
talk about the importance of having a bill like this to guide us in a 
new direction for economic recovery and what that means to the people 
in his district of Virginia.
  With that, I'll yield to my good friend.
  Mr. PERRIELLO. Well, thank you very much for that news and for the 
news from our friends in the house of lords--I mean the Senate--that 
has just come this way. It's very, very exciting because we, as a 
caucus, have been fighting so hard to shift the focus from speculation 
on Wall Street to job creation on Main Street. We understand that two 
out of every three new jobs in this country are coming from small 
business. Now, they may not make the headlines. It may mean you have 
lots and lots of small businesses, but that's the engine of our growth.
  One thing we still do better than any other country in the world is 
innovate. We are better entrepreneurs. We are really good at this. It's 
within our small businesses that we see this innovation taking place, 
and we need to make sure that we are giving the kind of support that 
small businesses need, whether that's through direct lending, whether 
that's through the suspension of capital gains tax for small business 
to bring nontraditional lenders in, or whether that's providing the 
infrastructure and the workforce development that allows those small 
businesses to flourish. We also need to understand that the phrase 
``buy American'' should not be seen as bad language.
  I think it's timely that we look at this extension because, while 
there are many policies out there which may seem fancy, sometimes we 
have to get back to the basics. We are within weeks of the new building 
season's beginning, the spring building season leading into the summer 
building season. There are thousands of small businesses around this 
country that have held on and have taken losses for 2 years, whether it 
has been the construction firms, the engineering firms, the supply 
stores that have supplied those guys, or whether it has been the diners 
where folks have gone to eat. If we are not building anything in this 
country, we will not continue this path of recovery that we have worked 
so hard to lay out.
  This is a chance, and we need to act here in Washington with the same 
urgency that the previous Congress did when Wall Street was in trouble. 
Well, Main Street is in crisis, and we need to understand that we can 
rebuild this country. We may not see housing start to pick up this 
summer in the way that some would like, but we can rebuild our 
infrastructure, and we can reinvest in the existing building stock, 
whether that's municipal, commercial, or residential, through major 
retrofit programs.
  It puts people to work in rebuilding America's competitive advantage, 
because what you understand, Mr. Braley, from your experience in Iowa 
and around this country is that we have to reinvent America's 
competitive advantage. We will outcompete the world, but we cannot do 
it solely through supporting the financial sector. We have to start 
building things, making things, and growing things again. We can still 
do that better than anyone in the world, but we need a trade policy, 
and we need a workforce development strategy. We need an economic 
development strategy that understands that those are things we can 
still do. There are sectors, like the energy sector, in which we can 
outcompete the world, but everyone else is not playing for second 
place. They are looking to do the same thing we are trying to do, but 
we can do it better.
  This is our time. This recession right here, that we are starting to 
crawl out of, is an opportunity for us to reinvest, to rebuild that 
competitive advantage and to reemploy America in the work that so many 
in this room have worked so hard to do. There are families out there 
right now who are proud, hardworking people who are looking for jobs. 
We can work together across the aisle to make this happen, but we must 
have that commitment to basic commonsense things, like making sure we 
don't miss this summer's building season. We have that time, and we 
must have a deep sense of urgency because I know people out on Main 
Street do.
  Mr. BRALEY of Iowa. I appreciate the gentleman's comments about 
investing in infrastructure because most of what I learned about the 
need for infrastructure improvements came when I was working for the 
Poweshiek County Secondary Roads Department to help pay my way through 
college.
  One of the things that I learned was that, as you try to create 
opportunities for transportation improvements that are going to move 
goods, services, and people, you see a lot of trickle-down that happens 
from the Federal Government, to the State government, to the county 
government, to the city government as right-of-ways are transferred 
after they are abandoned for bigger and better infrastructure 
improvements like four-lane highways.

                              {time}  2130

  One of the cornerstones of our blueprint for recovery that deals with 
job creation is a bill introduced by Congresswoman Rosa DeLauro and 
cosponsored by one of the vice chairs of the Populist Caucus, our 
friend from Minnesota, Keith Ellison, the National Infrastructure 
Development Bank Act.
  What it does is it creates an opportunity to take advantage of 
existing infrastructure needs by identifying about 47,500 jobs and $6.2 
billion of potential economic activity that are currently ready, 
willing, and able to be acted upon, but because we have not had the 
opportunity to marry private development with public infrastructure 
projects, we are missing an opportunity to stimulate job growth through 
this National Infrastructure Bank.
  So I would ask my colleagues who support investments in 
infrastructure improvements that cross the spectrum from expanding 
access to energy created by wind in the Midwest, by building out our 
ability to transfer that energy and electricity throughout the country, 
by building out our world broadband, by investing in roads, bridges, 
and public improvements, how this type of an investment development 
bank would make a difference in their districts.
  I am going to yield to my friend from Ohio.
  Ms. SUTTON. I thank the gentleman for yielding.
  Infrastructure creates such ripple effects in our economy and spurs 
economic development and opportunity for the people that we represent. 
Every time I go home, people beg, Please, please, invest in our 
Nation's infrastructure. We know that the need is tremendous.
  One of the bills, in addition to the National Infrastructure Bank 
bill, which I think we should talk about more, but you mentioned 
Representative DeFazio's bill, the bill entitled Let Wall Street Pay 
for the Restoration of Main Street Act. I think this is also a bill 
that deals with infrastructure, because when we get the money from 
those transaction fees of those risky trades that are something that we 
would really like to have cut back on, we are going to use it to invest 
in infrastructure and all the good that goes with it.
  But we also have in that bill, and I think it is important to tell 
people, that part of the revenue that would come in in addition to that 
huge amount going to invest in Main Street, you know, Main Street, 
after all, is who bailed out Wall Street, and we didn't do it because 
we were fans of their behavior. We did it so they would start lending. 
As we discussed, they didn't start lending, so we need to continue to 
push until things are right. But also in that bill, there is a part of 
the revenues raised that are going to go to deficit reduction. So we 
often hear this argument that it is all about the deficit.
  Well, it is about jobs and the deficit. In order to get rid of the 
deficit, people do have to have jobs. Frankly, obviously people need to 
have jobs, because

[[Page H1016]]

this is the United States of America, and that is the American dream, 
having a job and raising your family and aspiring to a quality of life 
that is second to none across this country. So, in that bill, in 
addition to putting money into infrastructure, we also take a piece of 
that money and let Wall Street help to pay down some of the deficits 
that were created by helping Wall Street get out of the mess that they 
were in.
  So, back to the other bill that you mentioned, which is critically 
important, and you asked how important it was back in Ohio, in my 
district. It just can't be overstated. Just yesterday, I received a 
whole list of infrastructure projects that are ready to go that need 
funding.
  The thing about infrastructure is that we all know that it can't be 
ignored indefinitely, right? But oftentimes we come to a place where we 
don't address it until a crisis occurs. And that doesn't make any sense 
either. So if we can put people to work doing that work that we know 
has to be done and spur greater economic development and recovery, why 
wouldn't we do that?
  This National Infrastructure Bank legislation is a critical component 
of taking the idea, the concept that we all know makes sense, and 
really maybe that is what the Populist Caucus represents more than 
anything; it is about the common sense. People know what we need to do 
for our country, to strengthen the middle class and put people to work 
rebuilding our infrastructure. Other countries are building their 
infrastructure. They are investing massively in their infrastructure, 
because they know the value that it creates beyond the jobs that are 
put forth just in doing the construction.
  With that, I yield back to the gentleman.
  Mr. BRALEY of Iowa. I think that is a great opportunity to talk about 
the importance, because when I served on the Transportation and 
Infrastructure Committee in the 110th Congress, our chairman, the 
legendary Jim Oberstar, always reminded us that our global competitors 
are investing massive amounts in infrastructure development.
  The European Union had a 5-year, $1 trillion infrastructure 
development plan. You look at China, which has just passed the United 
States as the leading consumer of automobiles, and you look at the 
ribbons of concrete that have been poured in that country to respond to 
growing consumer and commercial demand for transportation.
  If we are competing with these people in a global market, Dr. Kagen, 
we have to make similar types of commitments so that our infrastructure 
system can make us competitive. I know from visiting your district in 
northeast Wisconsin, it is a very spread out and remote area in some 
parts of your district, yet the constituents that you represent in 
those areas depend just as much on an infrastructure system as the 
people here in our Nation's Capital.
  I yield for your comments.
  Mr. KAGEN. I thank you. I will just summarize what everyone here on 
the House floor understands. We are about $2.1 trillion to $2.2 
trillion behind in our investment in our infrastructure, our roads, our 
bridges, our schools, our wastewater treatment plants. What good would 
it be if we generate several million jobs, even 10 million jobs, when 
we manufacture things and then we don't have the railroads or have the 
highways and the water infrastructure to transmit our goods to the 
world's marketplace? So we are indeed several trillion dollars behind 
in our infrastructure development.

  I will just point out one of the facts about the American Recovery 
and Reinvestment Act that few people realize. Apart from the fact that 
it was the largest tax cut in American history, little known is the 
fact that the transportation and infrastructure investment, which was 
only 4 percent of that amount of money we invested in America, 
generated 25 percent of the jobs.
  Nearly 900,000 people are working because of that American Recovery 
and Reinvestment Act of 2009. It put people back to work in our 
infrastructure. And that multiplier is significant. For every person 
working in transportation, that money turns over many times over.
  So let me just see if I get this straight, if I understand where we 
are going with our ideas about rewarding people or encouraging people 
with the taxation code.
  If you are sitting in a boardroom on Wall Street and you are 
rewarding yourself for your failure with the taxpayers' money, 
according to the Populist Caucus, we would like to put a significant 
tax on that bonus and use that revenue and put it back into the 
American economy to generate small business activity through the SBA, 
put it back into people's hands.
  We do believe that people are more important than profits. We should 
in fact reward work rather than wealth. If I understand the transfer 
tax on Wall Street speculators, it is one-quarter of one penny of each 
dollar being traded on nanosecond trades. This is not going to be a fee 
or a transfer tax placed on those who are speculating for the long-term 
investment. It is going to exclude any tax-favored retirement accounts, 
any HSA, Health Savings Account, any Education Savings Account, and 
would exclude the first $100,000 of your income generated from your 
investment in America's future on our American exchanges.
  Some people have pushed back against that Wall Street transfer fee by 
saying then people will trade overseas. In London, which is the most 
active trading floor in the world, they do have a transfer fee twice 
what we are suggesting.
  So, again, the idea is we want to use the Tax Code to reward people 
for their good activity. And, most especially, we want to use existing 
structures like our community banks, our credit unions, and regional 
banks to find the finances and credit necessary for small businesses 
once again to have access to the credit they need to generate the 
economic activity and generate the jobs.
  Don't think for a minute that the Federal or State government can 
employ you and work our way through this recession with government-
sponsored jobs. We can't do that. So it is the role of government to 
set up a system wherein you are rewarded for your work rather than your 
wealth. By focusing on our transportation and infrastructure needs, we 
can begin to generate millions and millions of jobs to do just that. We 
want people to stay in their own homes once again, rather than have 
this foreclosure crisis come back and bite us.
  Mr. BRALEY of Iowa. I appreciate those observations. I want to engage 
a couple of my colleagues in a conversation about behavior modification 
on Wall Street. I am going to start with my friend from Vermont, 
because he served on the Oversight and Government Reform Committee in 
the last Congress when we had the hearing with the CEOs of AIG, trying 
to explain why they stood by and watched as their London financial 
services division drove this economy off a cliff by engaging in excess 
and speculative trading in high-risk credit default swaps and complex 
derivatives.
  Now, one of the things we learned during that hearing from the 
economic experts who study those high-risk investments was that long 
before any of us came to Congress, Congress was confronted with the 
issue of how we provide some type of oversight of this highly complex 
and evolving marketplace, which at that time in the late 1990s was a 
small fraction of the $100 trillion marketplace it has become.
  But what was most shocking to me as they testified was when they said 
Congress was trying to decide what are these products. In a way, they 
are like an insurance product, because they are an agreement to pay 
upon a contingent future event. But they are really not insurance, 
because otherwise we could regulate them through the State insurance 
commissioners. Then they said, Well, these are kind of like stock 
trading, so we can have this regulated by the Securities and Exchange 
Commission. But it is really not a stock transaction.
  So, what is it? Well, about 10 percent of these products, those 
experts testified, if you remember, Mr. Welch, were real insurance 
products. And these economists testified the other 90 percent were 
pure gambling, people trying to make money by turning over 
transactions, betting on the come that at some point when those 
commitments came due, they would be able to generate a profit without 
adding anything of value, other than risk and a possible payment in the 
future.

[[Page H1017]]

  So, why is it necessary, when we are talking about ending excessive 
speculation, to get to the very core, not only of how you do that with 
a tax policy and with a transfer fee, but also how you deal with the 
financial oversight of the marketplace to make sure this never happens 
again?
  Mr. WELCH. Well, I appreciate that. You know, really what it is about 
is whether banking is going to be an activity that is about lending 
money to businesses, small businesses, families, to buy their first 
home, or it is going to be a mechanism for financial speculation. And 
it is really two totally different models.
  I want to just take up on what you were saying. We need a banking 
system. We need a strong banking system. We need local bankers who are 
actually engaged in their community, who can make judgments about who 
is good for a loan. I want to give you an example of the local bank and 
the Wall Street operation.
  In St. Albans, Vermont, we have a small bank, People's Bank. The 
president of that bank, Rick Manahan, his desk is in the entry of the 
bank. If you walk in, you see all the teller windows. There is a big 
vestibule area, the public area. His desk is there. People do not have 
a hard time asking Rick what is going on. He knows the folks in his 
community.
  His bank and his board of directors see a good day's work when, at 
the end of the day, they have been able to authorize a loan to a local 
business--it might be a retailer, it might be a construction company--
knowing that that business is going to use that money to help create a 
local job. Or it is a young family getting started. They have to make a 
tough underwriting decision. But they know that family, and they know 
they are going to do their level best to be good for it. At the end of 
the day, a house has been sold, a family has got a new place to live, 
and they go home and sleep pretty good at night, knowing that they have 
made a real contribution in the community.
  The other model, just to give you an example, one of our most 
esteemed Wall Street banks, is Goldman Sachs.

                              {time}  2145

  They have the best and brightest of folks doing the work there. But 
here's one of the things that they did--and it was very successful for 
them making money. They bought a mortgage origination company in the 
South. They hired 26, 30-year-old young people to go out, knock on 
doors, and sell mortgages. Generally, subprime mortgages that people 
couldn't afford and didn't need. They then brought those mortgages back 
to New York, and they bundled them into products that they then sold.
  But before they sold them, they got the best and brightest MBAs to 
knock on the doors of the rating agencies and persuade the rating 
agencies that these toxic instruments were AAA. Then they went to their 
sales department and had them contact trusted investors, pension funds, 
and said, We've got some AAA products here. You ought to buy them. It's 
going to be a good return for your pensioners. And they sold them. Then 
they went to their trading room and they said, You know what? These are 
junk. How do we know? We sold them. And they bet short against the 
instruments they'd just sold long.
  That would not happen at People's Trust in St. Albans, Vermont. They 
couldn't even imagine doing that, selling something that wasn't worth 
investing in. They couldn't do it. And I know that every single one of 
us, Republican and Democrat, have local bankers who've met that 
standard, where the goal is to serve the community. And they know that 
their responsibility with this trust that they have of depositor money 
is to put it to good work to build the economy.
  Wall Street has a different point of view. Not that they're not 
necessary; they obviously are. But when they are helpful, they see that 
the work that they do should be in service of the work that Main Street 
does. You know, that's why with the reforms that we must implement, 
whether it's a bonus tax, whether it's a Consumer Product Safety 
Commission, whether it's tightening up on the lending regulations and 
derivative trading, all of that, the bottom line is really very simple: 
Is the banking system going to be there to serve us, or are we going to 
be there to serve the financial engineering of the banking system? 
That's the question that this Congress faces and America wants an 
answer to. I yield back.
  Mr. BRALEY of Iowa. I thank the gentleman for your comments. We are 
just about out of time so I'm going to ask my friend from Florida for 
some closing comments, especially on this critical issue that affects 
the middle class homeowners, and that's the mortgage foreclosure 
crisis.
  Mr. KLEIN of Florida. I want to thank the gentleman. Just sort of as 
an add-on to what we're talking about, we all know that homeownership 
in the United States is crucial. It's crucial for people knowing where 
to plant their investment. They're working hard over the years to make 
sure they have a place to live, and hopefully it will increase in 
appreciation. But that same description that Mr. Welch just gave us 
about banking practices, in some cases resulted in, unfortunately, a 
whole lot of people getting in way over their heads, a whole lot of 
lending that shouldn't have never been lent in the first place, and the 
foreclosure situation is really bad in many places.
  I witnessed something over the weekend in West Palm Beach. In the 
West Palm Beach Convention Center a group came into town and said, We 
are going to bring together the lenders who, in many cases, have not 
been answering the phone, the line is busy or people haven't been 
getting answers, along with people that are having these real big 
problems, they can't make their mortgage payments. It's not like 
they're totally out of it. They may have had a job that was earning 
$50,000 a year, and they lost it, and now they're earning $35,000. Or, 
maybe a two-income household that they want to stay there. And we, as 
Americans, want them to stay there, if they can. We don't want 
abandoned houses. It just puts more pressure on the local streets and 
the local community.
  At this event over the weekend--it was running for 5 days, 24 hours a 
day--and all the major lenders were there, except for one. It was 
really interesting; 5,500 people were in this building at one time. I'd 
never seen anything like this. And they had the lenders sitting across 
the table, here to here, and they were actually ironing out one after 
another. One guy had an 11 percent mortgage. It was reduced to 5\1/2\ 
percent. His payment went from $2,100 to $1,300. And I asked him, Can 
you make do? He said, Yes. I'm keeping my house. I'm sleeping tonight. 
My children know they have a place, a roof over their head tonight.
  Well, this has been frustrating, but help is on the way. Help is on 
the way. And I think that the model has now been created. It's working 
in different parts of the country. But I'm really gratified to see that 
some people in south Florida were given that opportunity. There's a lot 
more to work through in all of our communities, but I'm starting to see 
some success, and that's part of how our recovery is going to happen, 
by putting the necessary pressure for people to get together and make 
this work.
  Mr. BRALEY of Iowa. And that's why the Blueprint for Recovery we've 
been talking about that the Populist Caucus has put forward--real 
solutions, concrete solutions, that are going to help us get out of 
this mess, by ending excessive speculation on Wall Street, making sure 
that we have a fair compensation system for the people who have gotten 
us into this mess, and spurring job creation with things like the Wall 
Street Bonus Tax Act, the National Infrastructure Development Act, the 
Make Wall Street Pay for the Restoration of Main Street Act, and the 
Buy American Improvement Act.
  These four commonsense bills will make an enormous impact on the 
quality of life for middle class families. They also represent true 
populist policies that are about building America up, not tearing it 
down. It's about giving voice to the legitimate concerns of the 
American people who made this country great.
  With that, I thank my colleagues, and I yield back the balance of our 
time.

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