[Congressional Record (Bound Edition), Volume 154 (2008), Part 16]
[House]
[Page 22149]
[From the U.S. Government Publishing Office, www.gpo.gov]


              GOVERNMENT FAILS WHEN WE IGNORE CONSTITUTION

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentlewoman from North Carolina (Ms. Foxx) is recognized for 5 minutes.
  Ms. FOXX. Mr. Speaker, this week we have been focused on what has 
been described as the most critical situation facing our economic 
status in our country since World War II. The liberals/Democrats say it 
is a failure of the markets. It is not a failure of the markets. It is 
a failure of our government. It is caused by ignoring the Constitution 
and by getting the Federal Government involved in things it should not 
be involved in.
  If we are about to allow the very people who got us into this mess by 
promoting the bad policies, especially Fannie Mae and Freddie Mac, to 
design the cure, then in common parlance, we are about to let the fox 
guard the hen house.
  Another point that needs to be made relative to this situation is 
that the Democrats in the House have been doing their best to blame 
House Republicans for the fact that a bill to solve this problem was 
not passed this week. What has to be said over and over again is that 
the Democrats are in charge, in control, of both Houses of Congress. 
They can pass any bill they want without a single Republican vote and 
have done so on hundreds of bills in the past 20 months, including 
several times today.
  But suddenly, the Democrats want to make this situation the 
responsibility of the Republicans. Most Republicans want to have no 
part of any further slide into socialism that the legislation the 
Democrats are likely to present to us will represent.
  The Republicans have presented alternatives that will not be allowed 
to be considered. But like many of my colleagues, I feel that God holds 
us guilty for sins of omission as well as sins of commission. 
Therefore, I think it is important that we raise the issues, that we 
discuss the situation, and that we present alternatives.
  One very thoughtful person has given us the benefit of his wisdom and 
advice in this situation, and that person is John Allison, chairman and 
CEO of the very successful Branch Banking & Trust, known as BB&T, which 
is headquartered in Winston-Salem, North Carolina. I will share some of 
his comments and put into the Record his letter of September 26.
  The letter is addressed to me.
  ``Unfortunately, while under normal circumstances, there would be a 
free market solution, given the publicity and psychological mindset 
which is being created, Congress not acting is extraordinarily risky. 
Therefore, an alternative to the Paulson plan must be developed. A much 
more effective, far less expensive solution to the financial crisis 
than the Treasury Secretary presented is outlined below.''
  As I said, I won't read all of the letter, but I want to highlight 
some important points. He underlines these, and I do, too.
  ``Without Freddie Mac and Fannie Mae and the affordable housing 
program (subprime), we could never have made a misallocation of capital 
of this magnitude.''
  Again, Mr. Speaker, the problem lays directly with the Democrats who 
pushed Fannie and Freddie and refused to allow Republicans when they 
wanted to bring them under control. Let me share the end of his letter.
  ``By the way, the reason Bernanke and Paulson cannot see the solution 
is they are making a fundamental epistological (thinking) error. 
Bernanke is thinking from economic theory and Paulson is thinking from 
a capital market theoretical perspective. To solve the problem, we have 
to deal with the real physical world, i.e., the fact that there is a 
physical inventory of houses that needs to be cleared, and we must 
grasp what motivates real individuals (not theoretical collectives) to 
act.
  ``A carefully designed housing tax credit and ending fair value 
accounting (as currently implemented) will fix the real estate markets, 
capital markets and the economy. This program will likely actually 
increase tax revenue by stimulating the economy by increasing taxable 
income. There is likely to be net gain to the government.
  ``I hope you will give this issue serious consideration.''
  We have solutions available to us if we will follow them.

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