[Congressional Record Volume 156, Number 70 (Tuesday, May 11, 2010)]
[House]
[Page H3280]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   AVOIDING A SECOND ECONOMIC COLLAPSE: THE NEED FOR FINANCIAL REFORM

  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
Virginia (Mr. Connolly) for 5 minutes.
  Mr. CONNOLLY of Virginia. Madam Speaker, the global economy is 
increasingly interconnected. The current economic crisis may have begun 
in the United States, but it rapidly spread throughout the world. Now 
as we stand on the cusp of a sustained economic recovery, we must be 
mindful of the ripple effects and guard against further threats to our 
economy.
  Last Thursday's historic stock market plunge, initially precipitated 
by Greece's economic uncertainty, must serve as a stark reminder of 
what happens when you don't have adequate protections in place. Without 
proper oversight, Madam Speaker, our financial markets are dangerously 
exposed.
  In the financial chaos that erupted last Thursday, shares of 
Accenture swung from $40 to one penny and back to $40. Shares of 
Procter & Gamble traded for $54 on the New York Stock Exchange but only 
$39 on the NASDAQ. Those aren't market forces at work. Those are market 
forces that are broken. Almost 300 trades made under questionable 
circumstances had to be subsequently canceled by the trading houses. 
Such wild disparities highlight the dangers of a marketplace left 
largely to its own devices and the tremendous risk posed to our economy 
and those who invest in it.
  The recession of 2007 began in the financial sector. Its effects were 
widespread. Millions of Americans lost their jobs. Millions more had 
their homes foreclosed. Millions more lost their retirement savings, 
college funds, and emergency reserves. In fact, American households 
cumulatively lost $17.5 trillion in aggregate household wealth in the 
recession.
  Now it's true, Madam Speaker, that we're seeing signs of an economic 
recovery. The Nation's gross domestic product is once again growing at 
the rate of 5.6 percent in the last quarter of 2009 and another 3.2 
percent in the first quarter of this year. After 2 years of job losses, 
culminating with 741,000 jobs lost in January of 2009, we're finally in 
the midst of our fourth straight month of job growth, even though the 
other side of the aisle can't accept good news when they see it. More 
than 290,000 jobs were created last month, the most since March of 
2006. Despite the recent uncertainty, the stock markets are up more 
than 50 percent since their March 2009 lows.
  But it is that lingering uncertainty that we have sought to address 
with our actions in this Congress. Similar financial sector problems 
came to a head in 2007, leading to the worst economic recession since 
the Great Depression. And as last Thursday reminded us, we're still at 
risk to financial sector uncertainty. Responsible Wall Street reform 
remains one of the critical components of a sustainable economic 
recovery.
  Madam Speaker, with such an obvious need for reform, why hasn't it 
been implemented already? Why, for example, is the more than $700 
trillion--that's trillion with a ``T''--derivatives market still 
completely unregulated? We must ensure that this highly speculative 
market is brought out of the shadows and operates with transparency and 
responsible oversight. Why are the American taxpayers still faced with 
the possibility of bailing out financial institutions deemed ``too big 
to fail?'' Never again should private risk become a public 
responsibility.
  I was proud to join a majority of my colleagues in this body in 
supporting passage of Wall Street reform last December to address these 
systemic problems and protect American families and their savings. We 
provided for regulation of the shadowy derivatives market. We brought 
accountability and transparency to the financial sector. We ended the 
practice of ``too big to fail.'' We established safeguards to ensure 
that the abuses of the past are never again repeated. Madam Speaker, 
the House made Wall Street reform a priority.
  Although the Senate finally began its own deliberations a few weeks 
ago, the process thus far has been slow. I am encouraged to see 
bipartisan negotiations on the bill after a failed filibuster attempt 
by the minority. After last week, can there be any doubt that we need 
Wall Street reform now?
  Every day of delay is one more opportunity for a recurrence of 
economic uncertainty and even collapse. Last Thursday's roller coaster 
on the stock market was a clear reminder that we cannot allow a 
continued and willful lack of responsible oversight to expose American 
families, American business, and our whole economy to such potential 
risk. Madam Speaker, we must have Wall Street reform now.

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