[Congressional Record Volume 156, Number 38 (Tuesday, March 16, 2010)]
[Senate]
[Pages S1608-S1609]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              THE ECONOMY

  Mr. SANDERS. Mr. President, I wish to say a few words about the 
nature of the economy today, the cause of the very deep recession we 
are currently in, and what I think we have to do about it.
  Right now, our country is experiencing the worst economy since the 
Great Depression of the 1930s. While officially unemployment is 9.7 
percent, the reality is that we have some 19 percent of our people who 
are either unemployed or underemployed, people who would like to work 
40 hours a week but they are only working 20 or 30 hours a week.
  The crisis we are addressing today is magnified by the reality that 
the recession for the middle class and working families of this country 
did not just begin in the fall of 2008 with the financial crisis. In 
fact, the middle class has been collapsing for a very long time.
  During the Bush administration, over 8 million Americans slipped out 
of the middle class and into poverty. Today, some 40 million Americans 
are living in poverty. During the Bush years, median household income 
declined by over $2,100. Middle-class Americans earned more income in 
1999 than they did in 2008, and middle-class men earned more money in 
1973 than they did in 2008, with inflation being accounted for.
  When we look at people in this country who are angry, there is the 
reason. After working long and hard hours, tens of millions of 
Americans find themselves in worse economic shape today than they were 
in 10 years ago or even 20 years ago. Meanwhile, while the middle class 
shrinks and poverty increases, while more and more people lose their 
health insurance--so today we have 46 million with no health insurance 
at all--while 4 million American workers have lost their pension over 
the last 9 years, we continue to see in this country the most unequal 
distribution of wealth and income of any major country on Earth. That 
growing inequality is a moral obscenity, but it is a very serious 
economic problem as well. Because we become a nation in which very few 
have a whole lot, while a whole lot of people have very little.

  The immediate recession was caused, as I think everybody knows, by 
the greed, the recklessness, and the illegal behavior of a small number 
of giant financial institutions on Wall Street. These people were not 
content to be making 40 percent of the profits being made in America. 
Their CEOs were not content to earn bonuses of tens of millions of 
dollars a year. The hedge funds were not content to have their owners 
and managers become billionaires. No, that was not good enough. So what 
these financial tycoons had to do was to develop and produce worthless, 
complicated financial instruments which plunged our country and much of 
the world into a deep recession.
  To the frustration of the American people, a year and a half has 
passed since the financial collapse and what has happened? What actions 
has the Congress taken to rein in Wall Street, to tell Wall Street that 
their greed is not acceptable in this country, that they cannot 
continue to go forward with actions that destroy our economy and the 
lives of millions of people?
  Within a short period of time, the Senate will be considering 
legislation dealing with financial reform. I wish to congratulate 
Senator Dodd and others on the Banking Committee for the hard work they 
have done in producing a bill which, in a number of ways, moves us 
forward. But what I wish to say this evening is that moving us forward 
is not good enough. The American people want an end now to the 
recklessness and irresponsibility of Wall Street. They want an 
accounting and they want real change. They want, in my view, a new Wall 
Street which invests in the productive economy of small- and medium-
sized businesses that actually produce real products and real services 
and which actually create real jobs, rather than the activities of Wall 
Street, which is a giant gambling casino, playing with financial 
instruments that nobody understands and which, at the end of the day, 
produces nothing real.
  As the debate over financial reform moves on, I intend to play an 
active role in fighting for a number of concepts. Let me enumerate a 
few of them.
  No. 1, right now, people in the State of Vermont, in the State of 
Colorado, in the State of Rhode Island, and all over this country are 
paying usurious interest rates on their credit cards, and I use the 
word ``usury'' advisedly. We now take it for granted, and we accept the 
fact that our friends and neighbors and family members are paying 20, 
25, 30, 35 percent interest rates on their credit cards. That is wrong. 
That is unjust. In fact, according to every major religion on Earth--
Christianity, Judaism, Islam--it is immoral. It is immoral to lend 
money to people who desperately need that money and then suck the blood 
out of them because, when they are desperate, they are going to have to 
pay 30 or 35 percent interest rates. That is immoral. That is wrong.
  Over the years, a number of States, including Vermont, have said: We 
are going to prohibit usury. You can't do it. You can't charge more 
than 10 percent, 12 percent, 15 percent, whatever it is. But all those 
laws were made null and void by a Supreme Court decision which resulted 
in credit card companies being able to go to States which had no usury 
law and, therefore, they could sell their product all over this country 
with no limit.
  Let us be clear. Those large financial institutions that are charging 
Americans 25, 30, 35 percent interest rates on their credit cards are 
no better than loan sharks. In the old days, what loan sharks used to 
do was break kneecaps if people couldn't repay their loans. Well, these 
guys don't break kneecaps, but they are destroying lives just the same. 
People are desperate. They are borrowing money. We have all been to the 
grocery store and have seen people buying bread and milk with their 
credit cards, gas to get to work with their credit cards, because that 
is the only source of revenue they now have available to them, paying 
25 to 30 percent. We have to eliminate that once and for all.
  I will be bringing forth an amendment which does nothing more than 
what credit unions now exist under. Credit unions in this country, by 
law, cannot charge more than 15 percent interest rates, except under 
exceptional circumstances, and now they can go up to 18 percent, but 
most of them don't; the vast majority of them don't. I don't think that 
is asking too much.
  Secondly, I am going to bring forth language which will increase 
transparency at the Federal Reserve. This is an issue, interestingly 
enough, that brings some of the most conservative Members and some of 
the most progressive Members together. I remember a year or so ago the 
chairman of the Fed, Ben Bernanke, came before the Budget Committee on 
which I serve, and I asked him a very simple question. I said: Mr. 
Bernanke, my understanding is that you have lent out trillions of 
dollars of zero interest loans to financial institutions. Trillions of 
dollars. Can you please tell me and the American people which financial 
institutions received that money and what the terms were. I don't think 
that was an unreasonable question--trillions of dollars.
  He said: No, Senator, I am not going to do it.
  We have since introduced legislation to make them do it, and so forth 
and so on.
  It is beyond my comprehension that we do not know which financial 
institutions have received trillions of dollars of zero or close to 
zero interest loans. We don't know about the conflicts of interest that 
may have existed.
  In that regard, let me talk about a scam which is quite unbelievable 
that

[[Page S1609]]

goes on today. What goes on today is, companies such as Goldman Sachs 
borrow money from the Fed--and I have no reason to doubt that Goldman 
Sachs also was on the receiving end of these zero interest loans--and 
they borrow this money for a tenth of a percent, maybe a quarter of a 
percent, and then they take that money and they invest it in U.S. 
Treasury securities at 3.5 to 4 percent. That is a pretty good deal. 
Talk about welfare. Borrow money at zero or half a percent, lend it to 
the U.S. Government, which has the entire faith and credit of American 
history behind it, and you make 3 percent, 4 percent. What a deal. That 
is a pretty good deal. I think we have to end those types of practices 
and we have to move forward with real transparency at the Fed.
  The other thing we have to do, which is enormously important, is have 
these large financial institutions start lending money to small- and 
medium-sized businesses that are prepared to create meaningful jobs in 
this country.
  Earlier today, I think the Presiding Officer and I heard from former 
President Clinton, who made a very important point. He believes--and I 
agree with him--we can make profound changes in our economy; that over 
a period of years we can create millions of jobs as we transform our 
energy system away from fossil fuels to energy efficiency and to 
sustainable energy. There are small businesses in the energy business 
in this country that are ready to go, to create the jobs, if they can 
get reasonable loans, and they can't get that money today. We can 
transform our energy system. We can give a real spirit to our economy. 
We can create good-paying jobs, but we have to demand that Wall Street 
start investing in the real economy.
  Another issue I intend to play an active role in is this issue of too 
big to fail. I have said it once. I have said it many times. If a 
financial institution is too big to fail, it is too big to exist. We 
now have four major financial institutions which, if any one of them 
collapsed today, would bring down the entire economy, and what we have 
to do is start breaking them up now--now. We have to take action at 
this point.
  I think the American people are angry and they are angry for some 
good reasons. They are hurting financially. As I mentioned earlier, 
there are millions of Americans today who have seen a substantial 
decline in their income and are working incredibly hard and they are 
wondering what has happened. Then, despite all that, with the trend 
that has led to the collapse of the middle class as a result of Wall 
Street greed, we have been driven into a major recession.
  The American people want us to have the courage to stand up to Wall 
Street. I should say that in 2009 alone, our good friends on Wall 
Street who have unlimited resources spent $300 million in lobbying this 
institution. They spent $300 million. When they fought for the 
deregulation over a period of 10 years, they spent $5 billion to be 
able to engage in the activities which they did engage in and that led 
us to the recession we are in right now.

  So these guys, I guess they can borrow zero interest loans from the 
Fed--I don't know if they can use that for lobbying or whatever--but 
they have an unlimited sum of money. I think the American people want 
us to have the courage to stand with them, to take these guys on no 
matter how powerful and wealthy they may be. I think the eyes of the 
country and the eyes of the world will be on what we do.
  With that, I yield the floor.
  The PRESIDING OFFICER. The Senator from Delaware.

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