[Congressional Record (Bound Edition), Volume 154 (2008), Part 15]
[Senate]
[Page 20717]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              THE ECONOMY

  Mr. CORNYN. Mr. President, I want to say a few words about the 
principles that will guide my consideration and my vote on the proposal 
made by the administration, by the Secretary of Treasury, Henry 
Paulson, and Ben Bernanke, the Chairman of the Federal Reserve Board.
  I have to tell you I am extremely upset we find ourselves in this 
terrible situation. I can tell you the phone calls I have been getting 
from my constituents are that they are overwhelmingly angry at how we 
could possibly find ourselves in this situation.
  First of all, I think there has been a perception that--listening to 
Treasury Secretary Hank Paulson--is actually not true: that this is 
somehow a bailout for Wall Street. In other words, the people who have 
profited mightily from the enormous sums of money that have been made 
recently on Wall Street, in the end, they are going to get off scot-
free and the taxpayer is going to end up holding the tab. That is 
completely unacceptable.
  First and foremost, I think we need to ask ourselves how we can 
protect the American taxpayers. The vast majority of Americans played 
no part in the collapse of some of the largest financial institutions 
in America, and they should not be forced to pay the price for the 
irresponsible and risky conduct of those who were at fault.
  Secondly, we need to make sure this American economy remains stable 
and that small businesses, which are the lifeblood and the job creators 
in our economy, have the ability to grow and to create new jobs.
  I think in the end economic growth is the key. What can we do to keep 
this great economy growing and producing jobs? I believe responsible 
tax relief helps small businesses grow and helps create jobs. Now, how 
would I know that? Well, all I would have to do is look back to the tax 
relief we passed in 2003, which cut the dividends and capital gains 
rate, which gave rise to a net increase of about 7 million jobs in 
America. That is what life was like before we hit the subprime mortgage 
crisis and high energy prices.
  But we ought to look to what works, and we should not use this as an 
excuse to grow the size of Government and increase the size of the tax 
burden on hard-working American families and small businesses because 
that will make things worse, not better.
  Third, we need to ask ourselves if this proposal does enough to 
safeguard transparency and accountability. Frankly, I think a lot of 
work needs to be done here. I think the very fact that Moody's and 
other entities which actually grade the investment value of many of 
these mortgage-backed security projects completely missed the target 
and failed to predict the precipitous drop in value of these subprime 
mortgages and the securities that are backed by these mortgages is 
evidence this is simply an opaque and nontransparent system and that 
not even the people who should know were able to evaluate what the true 
value of these mortgage-backed securities were. So I think we need to 
have certainly more transparency in this process, and we need to make 
sure those who are responsible are held accountable.
  I am very pleased to hear in today's news that the Federal Bureau of 
Investigation has decided to investigate, among others, the actions of 
Freddie Mac and Fannie Mae to determine whether fraud or corruption on 
the part of key players was the cause or contributed to the cause of 
our current financial turmoil. After the collapse of Freddie and 
Fannie, I sent a letter to the Attorney General of the United States, 
Michael Mukasey, and asked for a full investigation because in 2006 the 
very titans of industry who reaped millions of dollars in financial 
gain ended up with a slap on the wrist and no criminal penalty for 
cooking the books in order to generate larger bonuses and financial 
returns for themselves. That is completely unacceptable.
  We need to make sure those who are responsible for precipitating this 
financial crisis are held accountable. If that means they are guilty of 
crimes, they should go to prison and pay the price as an example to 
others who would take advantage of the American taxpayer and would be 
motivated by the kind of greed that lets them forget their 
responsibilities not only to their shareholders but to the American 
people themselves.
  So I am pleased the Attorney General is taking an aggressive posture 
and the Federal Bureau of Investigation is going to be conducting a 
thorough investigation. I say let the chips fall where they may. I do 
not care who it is. I hope they will pursue that to the fullest extent 
of the law.
  Mr. President, I appreciate the opportunity to come and address these 
very important topics, and I hope that as the days go by Congress can 
work together in a bipartisan manner to try to find a way to address 
these problems. But certainly the initial proposal by the Secretary of 
Treasury is unacceptable on a number of bases, but he has my 
commitment, as do my colleagues, that I will do my best to work with 
him to try to protect the American taxpayer.
  The PRESIDING OFFICER. The Senator from Ohio.

                          ____________________