[Congressional Record (Bound Edition), Volume 154 (2008), Part 14]
[House]
[Pages 20010-20014]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       CONGRESSIONAL BLACK CAUCUS

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 18, 2007, the gentlewoman from New York (Ms. Clarke) is 
recognized for 60 minutes as the designee of the majority leader.
  Ms. CLARKE. Mr. Speaker, on behalf of the Congressional Black Caucus, 
our chairman, Ms. Carolyn Kilpatrick, and the 42 other members, it's my 
privilege to come and discuss the topic of the hour--I believe the 
topic of the century--and that is the collapse of our financial service 
sector and the proposed bailout that we've all heard of this past 
weekend.
  You know, it wasn't that long ago that I heard a gentleman who was 
serving as Secretary of State to the United States saying to us, when 
we launched into Iraq and we knew that there was going to be a whole 
lot of trouble and it was going to be an expensive venture, that if we 
went in there and we broke it, we own it. Well, ladies and gentlemen, 
another example of breaking it, now owning it.
  You know, the Bush administration and the folks on the other side of 
the aisle turned a blind eye and a deaf ear in the name of so-called 
``free markets''--which, in fact, is not free and all Americans are 
learning today it's costing us $700 billion; very, very expensive 
lesson. Because when the call for regulation in this sector went on 
deaf ears and more deregulation was the mantra, and keeping the free 
market free led to this feeding frenzy that now has all of us pulling 
out our hair wondering how we got here. Well, I can tell you that in 
communities like mine, we got here because people were given bad loan 
products, they were given subprime loans. There was no investigation, 
due diligence done to make sure that individuals could, indeed, 
understand the terms and conditions in which they were being subjected. 
And we turned a blind eye to

[[Page 20011]]

that. We felt that the crisis in the subprime market was only for those 
people, and it wouldn't impact on the overall society. So we said, 
well, poor them, and they should have known better. Where are the folks 
screaming ``they should have known better'' now? Where are they now 
that the so-called folks in the know who should have known better 
allowed their corporate interests and corporate greed to supercede 
their obligation to our Nation, to our overall economy, to our well-
being, where are they today? Well, they're meeting behind closed doors.
  There are meetings taking place all over the place this evening, 
folks trying to scramble here and there to come up with the best deal 
for ``the bailout.'' Well, I can tell you that in just about all of the 
offices of the members of the Congressional Black Caucus the phones are 
ringing off the hook. They're ringing off the hook for people who have 
had to file bankruptcy because they had no health care insurance and 
someone got ill in the family and they had to use everything they owned 
to pay off health care costs that have skyrocketed and they've had to 
refinance and refinance and refinance their homes over and over again 
to get the money needed to help in a health care crisis. And we're 
getting phone calls from people who got their economic stimulus rebate 
only to face skyrocketing oil costs and gasoline costs and costs of 
living just going up while their wages have stayed stagnant. And we're 
getting calls from individuals who, due to lack of real management in 
these financial firms, are mid, low-level employees that are now 
unemployed and who also bought into the ``American dream'' and their 
mortgages are coming due and they don't know where their next check 
will come from.
  Well, we are in an economic crisis, and I think we need to not have 
amnesia at this time. We need to remember where all of our financial 
woes have come from. They've come from an administration and a party 
that the free market is truly free, that the need for regulation is 
something that is not a part of being Americans when we regulate every 
other part of our lives and we regulate just about everything else we 
do except for the feeding frenzy and the greed that is taking place in 
this Nation over the past 12 years.
  It's unfortunate that we've arrived at this moment in time, and it's 
a very expensive wake-up call for all of us. I understand that folks 
are moving very aggressively to address the financial crisis, as quoted 
by our speaker, Nancy Pelosi, ``to aggressively address the financial 
crisis.'' ``We will investigate the Bush administration's mismanagement 
of financial regulation, how it led to this crisis, and what solutions 
Congress can act upon.''
  ``I don't think the American people want us to wait until next year. 
We would hope to have something as soon as we can.'' And I agree. We 
must have some accountability here. This is not a time to use fear 
tactics, to get people to just go along, to get along. This is a time 
for accountability.

                              {time}  1945

  We are at a time where the crossroads have come and where we're right 
at that fork, and either we will continue with the same or we will make 
a change for the betterment of our civil society.
  Let me just say that, as we look at this bailout, it is our hope that 
we will look at Main Street and, as opposed to the trickle-down 
economics that got us to where we are today, that we will start at Main 
Street and will look at the needs of those who have been given these 
flimflam subprime loans and will work to make sure that we can keep 
Americans in their homes. We need to come out of this process with a 
corridor or with a pathway for American families to be able to 
renegotiate their terms in the same way that our financial institutions 
are asking for the renegotiation of their terms.
  What is good for those who have benefited from this feeding frenzy, 
from this bonanza, from this greed, from this run-on money is good 
enough for those who have had to pay the cost. It is our hope that that 
will be a part of what ultimately is negotiated so that we can pass in 
this House a bill that is reflective of the desire of the American 
people.
  The financial rescue that we are asking to consider this week will 
require some legislative solutions. It will conduct investigations into 
how Wall Street actually got into this crisis, and it will clean up 
what has become a huge mess, and it will insulate Main Street from Wall 
Street. We want to know how we will prevent this from ever happening 
again.
  Congress is ready to work, but we are ready to work as coequal 
partners in this process. We are not willing to have the administration 
dictate to us the terms under which we will do what needs to be done to 
set our financial house in order. It's not up to us to simply hand over 
a $700 billion blank check to those in the financial sectors who are 
now in crises and hope for a better outcome.
  The CBC, working along with our colleagues throughout this body in 
the New Direction Congress, will work to protect taxpayers' interests. 
We will make sure that the necessary safeguards that we believe will 
provide a responsible solution will include independent oversight and 
protection for homeowners with reasonable limits on executive 
compensation for CEOs and for other top executives.
  I think one of the things that really boggles the mind of the 
average, everyday American is the fact that the corporate CEOs have 
gotten away with wrecking their corporations while receiving bonuses--
golden parachutes--when they're asked to leave. Now, for the average, 
everyday American, when they don't perform well at their jobs, all that 
they can expect is an escort out the door of their employers'. Yet 
somehow we've gotten it so twisted that we are actually giving rewards 
for bad performance. This has got to stop.
  I do not understand how in a day and time when we're asking for 
accountability from everyone that we would enable these individuals who 
have been reckless in their endeavors to walk away scot-free. So we are 
clear that whatever we legislate this week will have implications for 
those who are in executive office and for those who are seeking to 
receive compensation as they depart from jobs poorly done.
  I see that I have been joined this evening by the very distinguished 
gentleman from Chicago, Illinois, by a gentleman who has been a part of 
the Congressional Black Caucus for quite some time now and who has been 
a leader in education, in labor and in understanding the challenges of 
our urban communities across this Nation. I know he, like so many other 
members of the Congressional Black Caucus, has been getting phone calls 
throughout the weekend, starting Friday into today, nonstop, from his 
constituents who have been raising their concerns and their issues 
about the crisis that we're in, and they've been giving their advice 
about what they would like to see from us as a body representing their 
interests.
  So, at this time, I yield as much time as he would like to consume to 
the gentleman from Chicago, Illinois, Congressman Danny Davis. 
  Mr. DAVIS of Illinois. Well, thank you very much.
  I just want to commend and to thank you, Representative Clarke, for 
the leadership that you've taken on this issue as well as on a number 
of others. When you were elected, those of us who knew of your history 
and who knew of your family's history in New York were all delighted to 
know that we were going to have a queen warrior join us in the House of 
Representatives, and that's exactly what you have demonstrated yourself 
to be.
  With every phone call that I have gotten--and I represent a district 
where the people like to be engaged and where they like to be 
involved--one of my biggest bills is probably my phone bill. That's 
because our phones are constantly being used all the time, all the 
time, all the time.
  In practically every call that we have gotten, the people have said, 
``Don't fall for the okey-doke.'' So, you know, you have to ask them 
``What is the `okey-doke'? What are you talking about? What are you 
asking us not to fall for?'' They'll say, ``Don't fall for

[[Page 20012]]

any bailout plan that only bails out financial institutions, that only 
bails out financial investors, that only bails out sophisticated 
traders, that only bails out people who really know and who understand 
markets and who have got all of these sophisticated tools and all of 
this information. Make sure that John Smith gets bailed out. Make sure 
that Sally Jones gets bailed out. Make sure that Mary Jackson gets 
bailed out.''
  In essence, what they were saying is make sure that, as to any 
bailout plan, it has built into it consumer interest for the little 
guy--for the person who has invested and who has created a life savings 
that is being wiped out without a minute's notice, for the individuals 
who've got retirement plans that they've meticulously tried to put 
together and from which they're hoping to have some little nest egg at 
the end of their work. Make sure that these individuals' interests are, 
in fact, protected; make sure that they are included, and make sure 
that there is enough oversight to protect them.
  As a matter of fact, one guy called, and he just said, ``If you want 
to make sure that you do something, make sure that you regulate, 
regulate, regulate, regulate, regulate and that you have oversight, 
oversight, oversight, oversight and that you have enough independence 
and enough people involved in oversight who don't have the 
institutional interests nor the self-interests that will take them away 
from the public interest.''
  So it's the public interest that we're talking about protecting. I 
don't believe in having more oversight than you need to. I don't 
believe in regulating more than what is necessary, but I can tell you 
that I believe sincerely that deregulation has been part of the 
culprit. We know that people have come to us and have said, ``You're 
strangling our ability to grow and to make money.'' Well, how much 
money do you really want to make? When is enough, enough, enough?
  Another person told me the other day that the history of the world, 
my sweet, is deciding who eats and who gets to eat. It seems to me that 
there is an opportunity with this crisis, that there is an opportunity 
to make sure that bailout plans and schemes will create jobs, that they 
will promote the redevelopment of many of our inner city and depressed 
rural communities throughout the country and that they will make sure 
that the money goes where it is actually needed.
  So I am prepared to vote for that kind of a bailout plan. I am not 
prepared to vote for anything that does not represent the serious 
consideration of the public interest. I'm hoping that as we debate, 
discuss, develop, and align things this week that that's what we're 
going to come up with.
  So I again want to commend you. I want to thank you. I want to 
appreciate your leadership, to appreciate the work that is being done. 
I can tell you that, when the dust settles and after all is said and 
done, the American people will judge us by what we do for America, not 
just by what we do for any category or for any group of interest 
entities but by what we do for America.
  I thank you again, and it has really been a pleasure to stop by. I've 
got to go and do what just regular people do, you know. I've got to go 
and wash.
  I yield back the balance of my time.
  Ms. CLARKE. I thank the gentleman from Chicago, Illinois for his 
eloquence and for the sharing of his insights based on the constituency 
that he represents and based on the years of knowledge and on the years 
of experience that he has had here in Washington in dealing with these 
matters.
  This is truly an unprecedented time, but we have got to look back a 
bit to really get a sense of how we got here. Follow me on this chart 
over here. It's building a wall of debt.
  When you look back at the year 2001, our debt was at $5.8 trillion. 
Fast forward to 2009, and it is projected that our debt will have 
basically doubled in that time. Then let's also recollect the 
philosophy of the Bush administration and of the Republicans of this 
body. There was a great proclamation about the ownership society. That 
is, we want to make sure that this Nation is underpinned by the need 
and by the capacity and by the ability to own.
  Well, at the end of the day, what we see is that we own a whole lot 
of debt. On top of this debt, we're going to be owning $700 billion in 
poor assets, in assets that no one else was able to leverage to create 
profit. There were all of those loans that were given to those who 
wanted to be a part of the ownership society. In their hearts, they 
knew it was the best thing to do, but they were seized upon by 
unscrupulous individuals who provided a product that was basically a 
pipe dream.

                              {time}  2000

  We were all part of the ownership society, all right. And in the 
words of Colin Powell, you broke it, you own it. And I just find it 
quite interesting that everyone is getting on TV, particularly those 
who were responsible because of their lack of stewardship, because of 
their breaking of the public trust, to say, you know, no one is to 
blame here. Well, when you pursue policies that create such damage to 
American finance, American households and communities, the American 
psyche, well, I think you need to own that too.
  So today we are talking more about some of the proposals that are 
coming before us. I just want to put in a word about the fact that in 
this whole ownership society there was also a lack of discipline, and 
discipline can be shaped up in a number of different ways.
  The way I like to discuss it, it has to do with regulation. I find it 
ironic that there are people in the financial world, real bigwigs, who 
have not been able to come to grips with the fact that their joyride is 
over, that happy days are not here again, but that they have driven our 
economy into the ground, and they are all lining up right now to want 
to be part of the solution, without regulation, without accountability.
  Those days are over. I can tell you that the members of the 
Congressional Black Caucus, the members of the Democratic Caucus, the 
Members of the new Congress are not going to sit by idly have false 
proclamations made without substantiation.
  We have back in March of 2008 when we spoke about the issue of 
regulation and the need for regulation, our own President saying, ``I'm 
deeply concerned about law and regulation that will make it harder for 
the markets to recover, and, when they recover, make it harder for this 
economy to be robust.''
  Well, Mr. President, the markets failed with no regulation. 
Regulation was not a part of the equation here.
  Then you have our nominee in the Republican Party, Senator McCain, 
who says, ``I am always for less regulation. I would like to see a lot 
of the unnecessary government regulations eliminated.'' March of this 
year. Now, everyone knew. Everyone knew this was coming down the pipe, 
and they are now the ones calling for regulation.
  Well, now that the horse is out of the barn and the crisis has hit, 
it is easy to make that determination, because hindsight is 20-20. But 
when reasonable people pleaded, held hearings to talk about the need to 
regulate what was going on, when we saw predatory lending becoming a 
cancer, a gangrene in communities of color, when we saw the subprime 
foreclosure market just eat communities alive, there was no mercy. 
There was a wink and a nod, and the feeding frenzy continued.
  Then it spread to the prime market, and the feeding frenzy continued. 
It continued so much so that in many of these financial institutions 
folks were almost delusional about the condition that their companies 
were in. Overnight it seemed, all of a sudden everything came cascading 
down.
  You know, for the average American, we don't get bailouts. We get 
reprimanded. We get marginalized. We get being told that we are 
irresponsible. Yet I hear none of that terminology for all of these 
folks who have not only upset the U.S. market, their reckless behavior 
has upset the world market. The world market.
  We have an over abiding obligation in the United States of America. 
We are looked to around the world for our excellence, for our ability 
to handle our affairs, and that has been eroded to nothing under the 
Bush administration. Not in one area can we say that

[[Page 20013]]

we have held to the American ideals, and this economic crisis marks 
that.
  Let me also share with you something you already know, and this has 
to do with our economy, it has to do with the loss of jobs. Back when 
Bill Clinton was President of the United States, as you can see, our 
economy was robust and we were on a path to prosperity with respect to 
job growth and development.
  Under the Bush administration, in just 8 years we have brought so 
many families, so many communities into poverty. The number of new jobs 
needed per month to keep pace with the growth in the working age 
population, 150,000. And look at the performance of the Bush 
administration.
  This says it all, folks. We are in an economic downturn. Individuals 
are unemployed, health care costs are skyrocketing, energy costs are 
through the roof, financial markets are crashing. All of this, all of 
this did not happen overnight. It certainly hasn't happened since the 
new Congress. This was a building process.
  And for individuals to stand up and say that it was the Democratic 
Congress that caused this to happen, it is insulting the intelligence 
of the American people. It started during a period of time where the 
philosophy was in place that anything goes in the free market. It 
started when there was a philosophy in place that said that the 
ownership society is one that does not need to be regulated. It started 
and continued on a path of destruction under the leadership of the Bush 
administration.
  Compounding that is the continued war in Iraq. Compounding that is 
the cost of health care, that grows exponentially each month. 
Compounding that is the loss and the hemorrhaging of jobs. So Wall 
Street has now caught up and our economy is so fragile that meetings 
are taking place throughout Capitol Hill in every nook and cranny to 
save, to save, our financial well-being.
  When we say our financial well-being, it is truly our financial well-
being, because we have known in urban communities for quite some time 
when the unemployment rate was rising that something was wrong. It was 
an indicator. When people began losing their homes, filing for 
bankruptcy. When folks who had formerly been middle-class had quickly 
in the blink of an eye become part of the working poor or homeless, no 
one shed a tear. And now every news media outlet is crying the woes of 
the financial giants.
  Well, I guess this is the day of reckoning, and this is the time 
where the great equalizer is making things happen in real time, because 
this Congress has an obligation, and I certainly will not be voting for 
any bailout that does not include a bailout of the people that I 
represent.
  When the Bush administration took office in 2001, it inherited a 
projected surplus for 2008 of $651 billion, $651 billion when they took 
office from the Democratic President Bill Clinton. The unemployment 
rate as we know it today continues to increase, from 4.7 percent to 6.1 
percent, and shows no sign of slowing down. We are truly, truly being 
governed by an administration that has moved in the wrong direction, 
and our economy is a reflection of those policies.
  So what is the House of Representatives being asked to do? Well, this 
week we will begin going over a number of proposals. The package that 
has been talked about so much in the press puts limits on executive 
compensation and sets the economic structure in a way in which we will 
advocate help for homeowners from foreclosure so the crisis will not 
cripple our communities.
  We are calling for oversight. Oversight. The Government 
Accountability Office needs to monitor the progress of any proposed 
programs. We are granting the Treasury Department way too much power as 
estimated and as called upon by many of you out there in our 
communities, and there needs to be much more transparency.
  The anything-goes Bush administration policies have been 
irresponsible. The non-regulation of financial institutions has led to 
this crisis, let there be no mistake about it. There is a lot of spin 
going on out there. There are a lot of folks who want to sugarcoat what 
has been in my estimation a dereliction of duty.
  We need to move in a new direction, with responsible regulation and 
safeguards for middle-class folks, for folks who live in urban centers 
who have been paying for all of these bailouts. We will also launch an 
investigation of the regulatory failures and mismanagement that has 
treated our financial system as a cash cow for some. And, most 
importantly, we will build a future of financial security for those who 
are hurting in our Nation right now, in particular those who are in the 
working and middle-class.
  It is clear that the administration has requested that Congress 
authorize in very short order very sweeping and unprecedented powers 
for the Treasury Secretary to confront a financial crisis of what 
people are saying are epic proportions. Well, that is going to come at 
a price as well. This administration has not demonstrated that it can 
be charged with the responsibility of managing the affairs of this 
Nation in a way in which harm is not done to its people. So, good luck 
with that one.
  In working with the administration, we will strengthen the proposal 
by ensuring that the government is accountable to taxpayers in any 
future action under this broad grant of authority.
  Now, we don't want to make this seem as though we are not going to 
work in a bipartisan manner. We are. But we are not going to have 
shoved down our throats policies that promote more of the same bad 
behavior. That behavior is gone, it is in the past, and we are saying 
that if you want to collaborate, we are willing to work with you, but 
there has to be a recognition of the failures so that we don't repeat 
them in the future.

                              {time}  2015

  When the Bush administration took office in 2001, there was a 
projected surplus of $651 billion. Today we stand on the advent of 
having to bail out the financial institutions of this Nation to the 
tune of $700 billion.
  While people say that, well, this is not going to impact the budget 
because we are seeing this really as an investment as opposed to an 
expenditure, well, we have to expend it first, and we have to create an 
environment that encourages the purchase of what has been bad business. 
How we shape that is really up to those in the financial sector to come 
to the table.
  But I can tell you, the American people will not be left holding the 
bag here. They will not be left holding the bag for those who decided 
that they were going to treat this country like their own personal ATM 
and that they were going to bankrupt us at a time when we should be 
experiencing great prosperity.
  The debate has begun, the conversations are being had throughout the 
Capitol across party lines. As we concern ourselves about our financial 
instability, we reflect on those who live in our communities, who are 
senior citizens, who could have been hoodwinked into partially 
privatizing their Social Security and the proposals that are coming out 
of the Republican party to partially privatize and invest for health 
care.
  If we had pursued those policies, can you imagine the hysteria in so 
many parts of our community where people have invested their lives, 
their well-being in a scheme that benefited the most wealthiest sectors 
of our Nation?
  Can you imagine that under the Bush administration the tax cuts that 
were given to this same class of folks, the wealthy, and you look at 
the rising of the deficit, and you look at all of these indicators of 
greed, of free-market greed, you have to ask yourselves, do we and can 
we trust, again, an administration and a party that would be so 
derelict of duty, that would be so frivolous as to cause the type of 
hardship that we are all digging deep to endure right now?
  Well, in this new Congress, under the Democratic leadership of 
Speaker Pelosi, that type of behavior has come to an end. As we debate, 
as we go over all of the proposals, as we vet every line, every comma, 
every period of what is being proposed for legislation, I

[[Page 20014]]

assure you that the members of the Congressional Black Caucus, under 
the leadership of Congresswoman Carolyn Kilpatrick, will keep their 
finger on the pulse of what is happening and what has happened and what 
must never be allowed to happen again within our communities, within 
communities across this Nation that have had to bear the brunt of this 
feeding frenzy, have had to shoulder the burden of economic crisis way 
before Wall Street met its day of reckoning.
  We will be there to make sure that there is some parity for those who 
are struggling each month to keep up with that mortgage payment, for 
those who are concerned about how to juggle the mortgage payment with 
the home heating oil payment and the health care costs, for those who 
are still caught in the credit crunch and their child's tuition bill is 
coming up, to those who are just trying to get by and do their part as 
Americans. You are not forgotten in this new-direction Congress.
  We stand with you, as a part of you, as we struggle through this 
debacle in our financial sector. I assure you, at the end of the day, 
we will come out of this process much stronger, much wiser, and 
certainly understanding that the days of free-for-all feeding frenzy, 
unregulated financial markets in the United States are over. By 
extension, we will be setting an example for how business will be 
conducted around the world.
  I thank you for being a wonderful Speaker pro tempore and for being 
there as we have our conversations during our CBC hour to open eyes and 
ears about the challenge that we will face this week. We will face it 
with all courage and dignity.

                          ____________________