[Congressional Record (Bound Edition), Volume 155 (2009), Part 5]
[House]
[Pages 6577-6583]
[From the U.S. Government Publishing Office, www.gpo.gov]




                      FIXING THE AMERICAN ECONOMY

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 6, 2009, the gentlewoman from North Carolina (Ms. Foxx) is 
recognized for 60 minutes as the designee of the minority leader.
  Ms. FOXX. Mr. Speaker, I am pleased to be here tonight to lead this 
special order on behalf of the Republican leader and am pleased to be 
joined by some of my colleagues now on the floor and others who will be 
coming.
  I want to say that we are going to talk about the economy tonight. We 
are going to talk about the cramdown bill that was passed here today. 
But I do want to say in response to the Progressive group, I think they 
call themselves, that was just speaking, is that any time I hear people 
talking about the need to do less in defense for this Nation, I want to 
say that I wake up every single morning and the first thing I do is say 
thank you, Lord, for letting me live in this country, and the last 
thing I do before I go to sleep at night is say thank you, Lord, for 
letting me live in this country, because I believe we live in the 
greatest country ever, and I know in large measure that is because of 
the great national defense that is provided to us by the men and women 
who risk their lives every day to keep us a free people.
  Do I think that we should write a blank check for defense? No, I 
don't believe that. But I do know from reading the Constitution, and 
all of us are sworn to uphold the Constitution, that national defense 
is the number one role of the Federal Government.

                              {time}  2045

  It has to be mentioned over and over again because, unfortunately, 
too many people talk about all these things we could be doing for the 
people of this country if we just didn't spend all this money on 
national defense.
  Well, Mr. Speaker, I have to say that States can't provide national 
defense, the counties can't provide national defense, the 
municipalities can't provide national defense. And we individuals can't 
provide for our national defense, except as part of a larger body. So 
it is our Number 1 responsibility as a Federal Government. And if we 
have money left over, then, fine. We may be able to do other things. 
But if we have money left over, the first thing we should do is give it 
back to the people from whom we take it forcibly and allow them to vote 
how to decide to spend it.
  I want to say that I don't say to people who criticize the defense 
budget that they're not patriots. But I think they should be very 
explicit about where they think money is being wasted. And again, if 
there's money left over, let's just give it back to the American 
citizens. Let's not spend it in Federal bureaucracies.
  So, as I said, we came here tonight to talk about the economy. That's 
the thing that's probably on most people's minds. Thank goodness we 
have a military that is allowing us to be safe, allowing us to be here 
on this floor at night, allowing us, every citizen in this country, to 
go about his or her job on a regular basis, all their activities, 
whatever they're doing and feel safe.
  But what's on the minds, again, of most of the people is the state of 
our economy and the inaction and incompetence of the Democratically-
controlled Congress and this administration in terms of how they have 
responded to the problems in our economy.
  So I want to recognize some of my colleagues who are here tonight and 
allow them to share some of their concerns. I'm going to be here for 
the entire hour. I'm going to let them speak, and then I will come back 
and, if there are things that still need to be said, then I will take 
up some time and share some information with those of you who are 
listening to us tonight.
  The first person that I would like to recognize is our distinguished 
colleague from Georgia, Dr. Broun.
  Mr. BROUN of Georgia. Mr. Speaker, I rise today because Americans 
have bought a product that is not living up to its guarantee. Promises 
made are not being kept, and the American taxpayer is paying the price 
for the defective product that they bought.
  This body has let the American people down. And I'm not just pointing 
my finger at the other side of the aisle. Both sides have hoodwinked 
the American taxpayer for not being fiscally responsible.
  If I sound alarmist, it's because I'm concerned that it's only 
getting worse. I'm frightened about the path that America's heading 
down with this administration and this Congress in the driver's seat. 
Harry Reid and Nancy Pelosi are driving this steamroller of socialism 
and, unfortunately, President Obama isn't putting up any roadblocks, 
and not even a slow down sign. And it's hardworking Americans who are 
getting run over.
  Right now, in addition to a $700 billion bailout of Wall Street, a $1 
trillion non stimulus bill, and a $275 billion housing fix, the middle 
class is also carrying on their backs the auto industry, Bear Stearns, 
AIG, Citi, Freddie, Fannie and countless others.
  For too long, lawmakers in Washington have ignored the pleas from 
hardworking families and small business owners in their districts. For 
too long, lawmakers in Washington have depended upon hardworking middle 
class to pay for their expensive programs, of which they rarely see a 
dime.
  But there is an alternative. The middle class can demand that 
lawmakers stop using them to pay for policies that benefit only two 
ends of the spectrum. That's why I rise today, Mr. Speaker, to offer a 
vision for those hardworking middle class families who pay for the Wall 
Street fat cat speculators, who pay for welfare recipients, and who pay 
for all this.
  My vision includes providing tax relief to small businesses and 
families. It includes offering incentive-based relief for job creators. 
We must skip the pork wish list and, instead, directly stimulate the 
middle class and small businesses, since they are America's economic 
engines. In doing so, jobs are created, faith is restored in the 
markets, and America's entrepreneurial spirit is once again unleashed.
  Contrary to what is being said, those of us who oppose the recent 
actions of this ``Credit Card Congress'' are not just saying ``no.'' 
Unfortunately, our alternatives to help our economy are not being 
considered.
  I want to give a 5 percent, across the board, income tax cut. I want 
to increase the child tax credit to $5,000. I want to lower capital 
gains, dividend and corporation taxes to bring investors back to 
America that have been taxed out of the country. I want to create jobs 
by producing American energy with American workers in the form of 
solar, clean coal and nuclear energy. I want to increase student loan 
deductions so that you can send yourself or your child to school at any 
age, with minimal financial burden.
  I want a health care system that is affordable for all people, one 
that is patient-focused, not government-focused, one where patients own 
their own insurance policies, one where the doctor/patient relationship 
is where health care decisions are made, not by some government 
bureaucrat.
  The economic recovery plan that I support includes no bailouts and no 
pork-laden projects. It creates twice the jobs at half the cost through 
permanent tax relief for families and for

[[Page 6578]]

small business here in America. This plan creates 73,000 more jobs in 
my home State of Georgia alone.
  I also offered an amendment to the stimulus to give every American 
who files a tax return approximately $9,000, their share of the 
stimulus bill. Clearly, not spending a trillion dollars would have been 
a much better option, but since Congress was bound and determined to 
spend the money, wouldn't it have been better to place that money back 
in the pockets of taxpayers?
  If a two-parent family, middle income, middle class family had 
received $18,000 in the mail, they could have bought a new car, gone on 
vacation, or even make a down payment on a home.
  David McCullough correctly states that, and I quote him, ``History is 
a guide to navigation in perilous times.''
  Let us not forget that in these tough times, that more government has 
never been a solution. Historically, socialism never has worked, never 
will work, and it will not work today. In fact, government actions were 
actually the stimulus that contributed to Fannie Mae and Freddie Mac's 
distension, easy money made available following relaxed interest rates, 
and ultimately, the push on American lenders to make loans, regardless 
of the borrowers' ability to pay.
  As Margaret Thatcher said, ``The problem with socialism is that you 
eventually run out of other people's money.''
  Mr. Speaker, I rise in that spirit to remind you that America was 
founded by pioneers with dreams who worked, and in some cases, died to 
protect freedom and make a more prosperous life for their children. We 
must not forget this.
  God promises us in Psalm 30:5 that ``Weeping may endure for a night, 
but joy cometh in the morning.''
  Now, I call upon all Americans, young and old, liberal and 
conservative, to demand a more efficient government, beat back the 
reach of big government, wipe away the tears of yesterday and demand a 
joyful morning in America, a future of freedom. America is depending 
upon it.
  Ms. FOXX. I want to thank my colleague from Georgia. What he has done 
is put to rest the comments made by so many of our colleagues on the 
other side of the aisle who say that Republicans are the party of 
``no'' and that we don't have a plan. Republicans, throughout this 
entire congressional session, beginning in January, have offered great 
alternatives to the abysmal proposals that have been given by the 
Democrats to deal with this economic situation.
  We understand that the American people are hurting. We want to help 
the American people in ways that we know are proven ways to make things 
better.
  What the Democrats have proposed are the things that will make the 
situation worse.
  The American people know we cannot tax and spend and bail our way 
back to a growing economy. They know that raising taxes during a 
recession, on almost every American, is a prescription for economic 
decline. They know that raising taxes on small businesses, where a 
majority of Americans go to work every day, will not put American 
families back to work. They know that cutting deductions for charitable 
giving will harm higher education, scientific research and religious 
organizations struggling to stay afloat.
  The American people know now more than ever before that Democrats are 
on the side of more government and more taxes. And we hope, through 
explaining our plans, that the American people are going to understand 
in a very tangible way that House Republicans are on their side, and we 
will continue to be on their side.
  Mr. BROUN of Georgia. Would the gentlelady yield for a moment, 
please?
  Ms. FOXX. I will.
  Mr. BROUN of Georgia. I want to congratulate you, Ms. Foxx, for 
bringing up something that is extremely important. When you opened this 
evening's special orders, you talked about national defense being the 
major function of the Federal Government under the Constitution. I 
carry a copy in my pocket all the time, and I believe in this document 
as it was intended by James Madison and company.
  If you look at this document, if the American people will look at 
this document, read what our founding fathers wrote, not only in the 
Constitution of the United States, but read what they wrote in the 
Federalist Papers, which were a group of essays to explain exactly what 
this document means. They will see that they've been handed a lie; that 
this document was never meant to be expanded beyond the 18 things that 
article I, Section 8 says that we, as a Congress, we, as a government, 
can do. And the 10th amendment puts a exclamation point upon that, 
because the 10th amendment says if a power is not specifically given to 
the Federal Government by the Constitution, in other words, those 18 
things in Article I, Section 8, if it's not prohibited from the States, 
things such as having their own army, things like having interstate 
tariffs and those types of things, that those rights are reserved for 
the States and the people. And national defense is exactly the major 
function under the original intent of this Constitution.
  And when we see people stand on this floor and cut down our defense--
I'm a Marine, and I believe in a strong national defense, just like I 
believe in this document according to its original intent.

                              {time}  2100

  I congratulate you for bringing that issue up as you started this 
discussion tonight because the American people need to understand that 
this document was never meant to be expanded the way government has--
the way the court has expanded it, the way the administration has 
expanded it and the way that Congress has expanded it--particularly 
beginning with FDR, with the New Deal.
  That brings us to today. The New Deal did not work. I was taught in 
school, in high school, that it did work, but that's just a bald-faced 
falsehood; it's not factual. The New Deal didn't work. The only thing 
that got us out of that recession, that depression in the '30s and into 
the early '40s, was gearing up the manufacturing base to supply World 
War II. So it was small business and manufacturing that got us out of 
that depression, and we're heading in that direction today in this 
country, with these bills, one after another, after another, after 
another.
  When the President came and talked to our Republican conference, I'm 
sure you'll remember he said that the stimulus bill was just the first 
of many big spending bills, of many socialistic bills, of many big 
government spending bills that he was going to bring to the floor and 
promote very quickly. The thing is socialism never worked, never will 
work, and it's not going to work today, and the American people need to 
understand what the Constitution says and what we're headed toward. 
We're headed toward the financial collapse of America if we don't stop 
spending our grandchildren's future.
  So I commend you, Congresswoman Foxx, for bringing up the 
Constitution, because I think the American people need to understand 
clearly that this is not a living document. It's a document of which we 
need to go back to the original intent.
  God asked a question in psalm 11. He asked: If the foundation is 
being destroyed, what are the righteous to do?
  What we need to do in America is to start rebuilding the foundations 
that this America was founded upon, those foundational principles that 
made America so safe, so secure, so rich, so powerful, and the only 
great power in the world today. If we leave those principles, then it's 
going to destroy America, and we're headed toward a depression in 
America if we don't stop spending our grandchildren's future.
  So I thank the gentlelady for yielding me a few more moments, because 
I am very fearful of the direction we're heading in this Nation today. 
We're heading in a direction that's going to be disastrous. We're going 
to lose what our founding fathers fought and died and sacrificed so 
much for, and it's up to the American people to demand better. It's up 
to the American people to demand from their elected Representatives a 
constitutional government, a limited government, a government that 
isn't intrusive in their lives.
  So I thank the gentlelady for yielding me a few more minutes. I am 
just

[[Page 6579]]

so passionate about this. We have got to stop this steamrolling 
socialism that's being shoved down the throats of the American public. 
It's going to kill the American economy if we don't do it.
  So thank you.
  Ms. FOXX. Well, I want to thank my colleague from Georgia. Many of us 
are passionate about this issue, and that's why I never let an 
opportunity go by to bring it up myself. We're going to have to get our 
Constitution caucus going and do a Special Order one night soon.
  It looks like we're going to have a lot of folks who represent the 
medical community here tonight. The second person whom I want to 
recognize tonight is a new Member of Congress this year. He is a 
physician and a former mayor of a town in eastern Tennessee. He is my 
neighbor in Tennessee. Our districts join each other. I'm in North 
Carolina. He's in Tennessee. He's going to bring us some wisdom from 
the heartland of this country from his experiences in being out, 
talking to folks, and some of his reflections on what has been 
happening.
  I would like to recognize Congressman Roe from the great State of 
Tennessee.
  Mr. ROE of Tennessee. Thank you very much.
  What I'm going to do tonight is just introduce myself to the people 
here and just share some real life experiences.
  I have lived in Johnson City, Tennessee for 31 years, have practiced 
medicine there, have built a thriving medical practice from 4 
physicians to over 70 with 350 employees, and so we've delivered and 
have worked in a small business.
  A few years ago, I decided to run for public office after just 
sharing some thoughts with friends, and I was fortunate enough to be 
elected to our commission and as the mayor of our city. I brought a 
very simple philosophy to government, very simple. It's not calculus; 
it's not arithmetic. It's simple math. That is: Spend less than you 
take in.
  When we went on the commission several years ago, we had deficit 
spending, and we had a bloated city government. With the help of some 
great leadership and our other commissioners, we cut almost 100 people 
from our workforce. In addition to that, we had only about $2 million 
in the bank, and that was essentially broke. During the last 6 years, 
we've passed six consecutive budgets without a tax increase, and have 
gone from a fund balance of $2 million to $24 million.
  So our city has a great savings account set so that, when this rough 
economy came, we were prepared for it like any individual would be with 
a savings account. We did this without raising taxes and without 
cutting services, and I think the people there rewarded us for this 
prudent behavior. As a matter of fact, Wall Street rewarded us by 
increasing our bond rating to a AA rating.
  I then fast forward. I come to Washington, D.C. in January, and I'm 
sworn in. In the fall, we all recall the $700 billion bailout, or the 
so-called ``TARP''--Toxic Asset Relief Program--that had already been 
passed by the previous Congress, and that was passed because of 
illiquidity in the banking market. People weren't able to get loans, 
and that's still an issue.
  One of the first things we confronted here was an $800-plus billion 
spending plan, the so-called ``stimulus.'' Now, one of the reasons we 
were successful where we were was we had a plan to correct our 
problems. We had a very well-thought-out plan, and we executed that 
plan--reducing debt and improving the financial stability of our local 
government.
  Here in the Federal Government, we had a massive, massive spending 
plan. As we went through it, it was 450 pages or so long. The plan was 
discussed here on the House floor and was sent to the Senate. It came 
back as a 758-page bill. After conference, it was 1,071 pages, which we 
were presented here on the floor at about 9 o'clock one Friday morning 
a couple of weeks ago. We voted on it 5 hours later, of which no one 
could have read that bill in its entirety and can tell me what's in it. 
So it was about $1 billion a page. What I saw was massive Federal 
spending.
  The options we have as a local government are: Number one, we can 
raise your property taxes. Tennessee is not an income tax State, so we 
have sales taxes and property taxes--that's a way we can raise 
revenue--or we can expand growth where you have more property taxes 
coming in. That's what we chose to do. We can't ask people to go down 
and spend any more money at the local department stores or at Wal-Mart 
or wherever. People are protecting their money now, so we can't do 
that. The Federal Government has a third option, and that is to borrow 
money, and they have borrowed massive amounts of money from China. If 
the situation comes where we can't borrow any more money on the credit 
market, then we have to print money. The danger of that is, when you 
expand the money supply, you certainly will create an environment where 
inflation may occur.
  I can tell you one of the things that I did. I took this 
responsibility so dearly to myself because the people who are hurt the 
most with higher taxes are the people at the lower income and our 
senior citizens on a fixed income. I can think of so many people in my 
community for whom $20 or $30 or $40 a month is just devastating. The 
gas price increases we had last year were just devastating--$4 or $5 a 
gallon. They just could not pay it. If you had people working, as we 
have had many people, for $10, $12, $13 an hour and they had to drive 
more than 10 miles to work, it took a day-and-a-half's work per week to 
pay their gas to get to work.
  So the people who are hurt the most are not the people here in this 
Congress, who make a good salary, or the people out there making six 
figures. It's the people on a fixed income. I think, as for this 
particular bill that we've done, this spending, if we create an 
inflationary spiral, we've hurt the very people we've said here that 
we're going to help. We've hurt them the most.
  I had the opportunity today to speak to a good many bankers because 
of some legislation that came on the floor, and it was about this, the 
home bailout. I called and spoke to numerous ones in my district. Let 
me just reminisce a little bit about the banking problems we've had.
  I think there are approximately nine banks in America that control 
about 70 percent of all of the financial assets in America and over 
8,000 community banks that control the other 30 percent. Less than 5 
percent of our community banks have had to ask for TARP money. Every 
single one of the major banks has been too big to fail. Well, who is 
going to go save these small community banks? I can tell you no one is, 
but most of them are very financially secure. I spoke to several today 
where less than 2 percent of their loans are a month behind or more, so 
they are doing very well.
  Then they were presented with a situation today in this particular 
bill where a bankruptcy court can say to you, You have to mark down the 
difference. If the home price decreases in value from, let's say, 
$230,000 to $200,000, you have to eat that. This local bank has to eat 
that.
  Ms. FOXX. Will the gentleman yield?
  Mr. ROE of Tennessee. The gentleman will yield.
  Ms. FOXX. When we were debating this bill last week, one of our 
colleagues on the other side of the aisle said that this is not going 
to cost the taxpayers a single penny. I responded: Well, the last time 
I looked, the banks are owned by shareholders, and those shareholders 
pay taxes if they have any kind of profit. It seems to me that 
shareholders and taxpayers are the same people.
  Those banks that you're talking about in your community, those 
community banks, are they owned by shareholders who pay taxes?
  Mr. ROE of Tennessee. Absolutely. Not only that, but if you do what 
they have recommended or what we voted on today, another provision in 
that bill is that you could get a zero in bankruptcy court. The judge 
could say, You get a zero interest rate for 30 years.
  I asked one of my banking friends, How do you make money if you lend 
at zero percent for 30 years?
  The bottom line is that those costs are passed on to the other people 
who

[[Page 6580]]

borrow money from that bank. So the taxpayers absolutely get the bill. 
That is a great point you just made.
  Ms. FOXX. Now, you've been a physician, but you've also been a 
businessman, and I think that's important. With 350 employees, that's a 
pretty good-sized small business. You understand that what was done 
today with this cramdown bill is going to affect taxpayers, and you 
understand how it's going to affect the people who play by the rules. 
I'll bet you had some of that in your practice, too, didn't you?
  Mr. ROE of Tennessee. Absolutely.
  What we've just said to many of the banks in our area and to the 
folks who've borrowed money with the intent of paying it back--which is 
the example I gave today--is, look, if somebody had bought a Tahoe last 
January and they had paid $40,000 for this new Tahoe, well, when gas 
prices went to $5 a gallon, you probably couldn't get $20,000 for that 
Tahoe. You were probably upside down in your loan right then, but what 
did you do? Did you walk back and give it to the bank? No. You kept 
paying on that until you paid your Tahoe off. So that's what we've 
asked people to do.
  I think this bill should be vetted extremely well in the Senate. We 
shouldn't cause people, the 98 percent of the people who are paying 
their mortgages on time in Tennessee, to say, Hey, I've got to also pay 
for this other mortgage when I'm doing it the right way.
  I think the experience I've had in government is that we've always 
preached--and I have seen it myself, have lived it and have breathed 
it--smaller government and low taxes. Businesses move in, and your 
economy thrives. I have personally witnessed that. I know it works. I 
come to Washington, D.C. What do I see? The most staggering spending 
that I've ever seen in my life.
  Let me pose a question. Then I'll let you answer this: When we passed 
the omnibus spending bill, I took that 2,000 pages back to show my 
constituents what we'd passed here. An 8.5 percent increase. Now you 
tell me what State government, what local city government is going to 
pass an 8.5 percent increase this year. The example we should be doing 
is: We in Federal Government are going to cut the size of this Federal 
Government. We're going to tighten our belt. It would be a wonderful 
example to the rest of the Nation.
  Ms. FOXX. I've noticed in the newscast how many people are losing 
their jobs in private industry. I haven't heard one word about any 
people on the Federal payroll who are losing their jobs. I agree with 
you: We have no business expanding the Federal Government at any level. 
We should be cutting back just like our constituents are cutting back, 
and we should balance the budget. We cannot continue to operate that 
way.

                              {time}  2115

  Mr. ROE of Tennessee. The thing that I noticed when I was home and 
you have, I'm sure, the same--and I have to say you have a wonderful 
Charlotte airport. During the snowstorm, I got to spend 24 hours there. 
So it's a beautiful airport. The people from North Carolina were very 
good to their neighbor from Tennessee.
  I think one of the things that we have to do is we have to set an 
example in the Federal Government to the rest of the Nation. If we did 
that, if we had a plan that we're going to balance the budget--I mean, 
this particular budget we're spending is $1.6, $1.8 trillion out of 
balance, and we're going to cut it--well, it's some gimmickry because 
when you don't have an $800 billion spending package, you've already 
cut that much of it. That's onetime dollars. So that's really not a 
fair cut.
  A real cut would be when you actually spend less money than you did 
the year before, and that's never happened in my view of Congress.
  Ms. FOXX. Well, some time soon I am going to share with you an 
article that I read in Human Events last November about what the 
Federal Government looked like in the '30s and what our society looked 
like and what our budgets looked like in the '40s. But it has been 
done, and that's what we need to do.
  I want to ask someone else to join us in our conversation here. We 
have our colleague from Wyoming (Mrs. Lummis) who is with us tonight. 
And I know that she has some interesting points that she wants to add 
to this discussion. And I want to bring her into it at this point.
  Mrs. LUMMIS. I thank the gentlelady from North Carolina and the 
gentleman from Tennessee for their dialogue. It brought to mind a 
constituent of mine.
  I am from the State of Wyoming, and an Arapaho woman, who is a friend 
of mine, had a business last summer on the reservation in Wyoming where 
she was bringing groceries in, trucking groceries into the reservation 
for easy access and purchase by members of both the Shoshone and 
Arapaho tribes on the Wind River Indian Reservation. It provided an 
opportunity for Native Americans to shop on the reservation rather than 
having to go into town in Riverton or Lander. It provided Native 
Americans with jobs in trucking and in the grocery business. And she's 
a wonderful entrepreneur.
  When the price of gas reached $4 a gallon, it was not clear that she 
would be able to keep her grocery business open. She was beginning to 
cut down on the hours that her employees worked, cut down on the amount 
of product she had on her shelves. And had those prices continued at 
that rate, she would have had to have closed her doors making it more 
expensive for Native Americans to drive to adjacent communities to 
purchase their groceries. Fortunately, the price of gas dropped.
  But since I've come to Congress, and particularly in the last week, 
I've seen, as a member of the Budget Committee and a member of the 
Natural Resources Committee, proposals in the President's budget for 
Cap and Trade legislation that would include $646 billion in new 
revenue. Now, that new revenue is going to come from the American 
people.
  Ms. FOXX. Would the gentlelady yield?
  Mrs. LUMMIS. I yield.
  Ms. FOXX. What does that word ``revenue'' mean? Don't we know it by 
another name?
  Mrs. LUMMIS. We do. And the gentlelady makes a wonderful point.
  These are taxes. These are taxes on the consumers of American energy. 
So if you have electricity in your home or in your office, or if you 
drive a vehicle, or if you use electricity or oil or gas or energy of 
any kind, you will be paying a tax. And that tax will amount to $646 
billion in new taxes, which will come out of your pocket.
  So 100 percent of the people who use energy in this country will pay 
100 percent of the taxes that will be levied pursuant to the Cap and 
Trade bill.
  Now, this means that a typical consumer, in their electric bill in 
their home, will see about a 62 percent increase in their utility 
bills. And businesses, small businesses--such as you and the gentleman 
from Tennessee have been discussing--will see a 100 percent increase. 
They will see a doubling in their utility rates.
  And, of course, other fuels will increase as well, including 
gasoline--which, once again, makes me recall my friend who brings 
groceries into the Wind River Reservation in Wyoming and the hardships 
that will be imposed on regular Americans as a consequence of Cap and 
Trade legislation.
  In addition, the proposed budget by the President includes an 
enormous array of taxes on the oil and gas industry, which will, once 
again, be passed on to consumers in America--that is if the industry 
here survives.
  And if the industry here does not survive or cuts back, that will 
reduce American jobs, it will increase our dependence on foreign 
sources of oil and gas. It fails to acknowledge that natural gas is the 
cleanest burning hydrocarbon. And my State of Wyoming, which produces 
coal, may end up shipping its coal to places like China, which are 
demanding coal and building new coal-fired power plants.
  Now, I learned today in a committee meeting before the Natural 
Resources Committee from a witness that was

[[Page 6581]]

brought in at the pleasure of the majority party that if you ceased all 
economic activity in the United States, Europe and Japan combined and 
did absolutely nothing, that unless China, India and Russia changed 
their ways, we'll see no reduction in carbon emissions--which is to say 
we could completely cease all economic activity in Europe, the U.S. and 
Japan and still, because of the carbon emissions and the increases in 
carbon emissions that are occurring in China, Russia and India, there 
will be no reduction in carbon emissions.
  So, in other words, we are not going to be able to influence. By 
hurting our own economy, reducing our own jobs, taxing our own people, 
we're not going be able to reduce carbon emissions.
  So, consequently, we need to look at the benefits of these programs 
that are being proposed in the President's budget and compare them to 
the costs. And I can tell you based on what I saw today in budget 
presentations in the Budget Committee and testimony in the Natural 
Resources Committee that the benefits of reducing carbon emissions in 
the United States, Europe and Japan are not recovered, and the cost is 
borne by the American people.
  Ms. FOXX. Well, I thank the gentlelady for sharing that experience 
that just happened today.
  I haven't heard it explained exactly that way, but I've known for a 
long, long time that we in the United States are not creating the 
problems. If there is a problem with global warming--I will tell you 
that I am a social scientist, not what would be called a ``pure'' 
scientist, but I've read enough to know that we cannot in any way prove 
that we are causing global warming.
  I think that the Lord's in charge of this Earth, and a lot of things 
have happened before human beings got here. There's been climate 
changes without us, and I think they're going to continue. So I 
appreciate you bringing that in.
  Mr. ROE of Tennessee. Would the gentlelady yield for just one 
comment?
  Ms. FOXX. I would yield.
  Mr. ROE of Tennessee. Just something even more sinister.
  What the gentlelady from Wyoming was saying is that the carbon tax, 
if you look at it, or cap-and-trade, just so people understand what 
that is, is when oil is offloaded from a ship or comes out of a well, a 
tax will be placed on it at the wellhead. So you pay a tax that goes 
directly to the consumer. Again, the least people able to afford this 
are the folks on a fixed income, our senior citizens, which we have a 
lot in our community.
  So when you go down to the grocery store to buy a bag of tomatoes or 
bread, it was brought there by a vehicle that's paying more to get 
there just because of this carbon tax. And the theory, as you pointed 
out, is we want to tax carbon to produce carbon dioxide into the 
atmosphere, and we'll use these other renewables.
  And at some other time, I certainly would like to go into some ideas 
that we've shared at the local level about how to reduce carbon at no 
cost to the taxpayers.
  Ms. FOXX. Well, I think this distinguished group of new Members 
should put together a Special Order one night and let's talk about 
energy.
  We've been joined by another one of our colleagues who came into the 
Congress along with the two of you who have just been speaking, and I 
have been very pleased to have had him come over and help me on a 
couple of Rules that I have handled on the floor and am very pleased to 
have him join us tonight.
  We have Mr. McClintock from the great State of California, which is 
not exactly in the best financial shape these days. I don't know if he 
wants to share any of that with us. But I know he's going to have some 
great comments to share, and I want to give him an opportunity to join 
in our discussion here.
  Mr. McCLINTOCK. Well, I thank the gentlelady for yielding, and I 
particularly thank her for organizing this discussion tonight over the 
future of our Nation.
  The discussion going on right here in these hallowed halls of 
Congress is exactly the same discussion that's going on around dinner 
tables, over backyard fences, over coffee at Starbucks.
  Everybody understands that our Nation is in great trouble. It's 
getting in deeper. And I think every citizen realizes that each of us 
has an important responsibility to play in being part of that 
discussion.
  The gentlelady is quite correct. California is in a world of hurt. 
It's followed exactly the same policies that this administration 
appears to be embarked upon. It's probably a couple of years further 
down the road than the rest of the Nation, which offers us a very 
important warning of what happens when reckless spending, reckless 
deficits and reckless tax increases all combine into a perfect storm.
  California's unemployment rate is now in double digits. This, a State 
that was once a golden land of opportunity, a State that used to have a 
recession-proof economy. It was always the last to see its unemployment 
rate rise. Now it's the first, and the reason is public policy.
  Mr. Speaker, I would like to add to that discussion tonight by 
broadening the discussion to a number of points that have been made by 
my friends on the majority side blaming the Bush administration for the 
Nation's economic woes. And I hope that I don't shock my friend from 
North Carolina to actually rise to join that chorus in some respect.
  We are all painfully aware that the Bush administration increased 
spending twice as fast as we saw it increase under the Democratic 
administration of Bill Clinton. The Bush administration's first 
stimulus bill added $160 billion to the national deficit through tax 
transfers despite warnings that it would do nothing to stimulate the 
economy, and it didn't.
  The Bush administration's bailout bill last fall added another $700 
billion to the Nation's deficit despite many warnings that it would not 
stabilize the economy, and it didn't. That administration ended with 
record spending, record borrowing, record deficits and an economy in 
shambles.
  But my question to many of my friends in the majority, Mr. Speaker, 
is this: If record spending, record borrowing and record deficits is 
the path to economic recovery, why aren't we already enjoying a period 
of unprecedented economic expansion? In fact, all of the bailouts and 
handouts and loan guarantees that have already been enacted add up to 
over $9.7 trillion, as we pointed out on this floor in the past. That 
is more than the modern-day cost--inflation adjusted--of the space 
race, the Vietnamese War, the Louisiana Purchase, the Marshall Plan and 
the New Deal combined.
  The fact is, these policies don't stimulate an economy; they stifle 
it. And it doesn't matter whether these policies are enacted under a 
Democrat or a Republican. They don't work.

                              {time}  2130

  They didn't work in the recession of 1929, when Republican President 
Herbert Hoover increased the marginal income tax rate in this country 
from 25 percent to 65 percent and piled up taxes on imports. They 
didn't work in the resulting depression of the 1930s, when nearly a 
decade of Democratic President Franklin Roosevelt's New Deal spending 
failed to stimulate the economy. And we forget that the unemployment 
rate in 1939 was actually slightly higher than it was in 1931. And we 
know from a year of failed bailouts and handouts and loan guarantees 
that these policies aren't working any better today.
  Today we learned that General Motors, despite billions of dollars of 
taxpayer bailouts, is still going under. Monday we learned that AIG, 
despite billions of dollars of taxpayer bailouts, is still going under. 
Mr. Speaker, don't they understand that the sooner that we stop bailing 
out failed companies the sooner we can begin a genuine economic 
recovery?
  Ms. FOXX. Would the gentleman yield?
  Mr. McCLINTOCK. Gladly.
  Ms. FOXX. I wrote this note down just after we started this session 
tonight, and I want to ask you if you have ever heard this famous quote 
by

[[Page 6582]]

Einstein: ``Stupidity is doing the same thing over and over again and 
expecting a different result.'' Do you think that characterizes the 
situation that we find ourselves in?
  Mr. McCLINTOCK. I believe Professor Einstein said it was not the 
definition of stupidity, but insanity.
  Ms. FOXX. Insanity, excuse me. The definition of insanity.
  Mr. McCLINTOCK. And I certainly concur with that. And what we are 
seeing here in this new administration are the same mistakes, 
multiplied, that we've just seen in the last administration.
  You know, before the failed $700 billion Bush bailout bill, this 
Nation's budget deficit was around $500 billion or so. Now, because of 
that mistake, the bailout bill--which, by the way, President Obama and 
many of my Democratic friends in the House supported and ultimately 
consummated--and because of all the other bills that have rushed 
through this House in the last few weeks with such reckless abandon, 
our deficit has tripled to $1.5 trillion for this year, on its way to 
an additional $1.75 trillion for next year. And as tempting as it is to 
censure the folly of the Bush administration's fiscal policies, I think 
we should be far more concerned with the greater leap in borrowing and 
spending that we are now pursuing under this administration.
  Now, Mr. Speaker, there is one institution that doesn't look back, 
and that's the stock market. The past is utterly irrelevant to the 
stock market; it doesn't care where the economy was yesterday, it cares 
very much where the economy will be tomorrow. The stock market is 
strictly a forward-looking measurement of what investors are betting 
will happen to our economy in the future under current policy. And the 
precipitous decline of the stock market since these new policies have 
been unveiled should be a warning to us all--today the stock market 
closed at its lowest point in 12 years. If the policies we're embarked 
upon were destined to save our economy, you would think that those who 
make their living betting on the economy would be buying like crazy, 
and they're not.
  Mr. Speaker, perhaps we would do well, then, to stop the partisan 
bombast and to realize that bad policy produces bad results, whether 
the President is a Republican or a Democrat; and, indeed, that 
Professor Einstein was right, doing the same thing over and over and 
expecting different results is, indeed, the definition of insanity.
  I yield back my time.
  Ms. FOXX. I thank the gentleman from California for giving us a great 
history lesson and reminding us of the kind of things that we ought to 
be about, again, regardless of what party we come from. And I want to 
say that I proudly voted against the bailout, predicted it would be a 
failure. And I voted every time in the last 4 years for reduced 
spending because many of us who came here in 2005 could see what was 
ahead.
  I want to now yield some time to our colleague, one of the most 
dynamic people that we have here in the Congress, Michele Bachmann, 
from the great State of Minnesota, where they say ``Minnesota nice''--I 
learned that this summer. So, Mrs. Bachmann, if you would, please, join 
us.
  Mrs. BACHMANN. Thank you. I want to thank the feisty gentlelady from 
North Carolina, from the Appalachian region, who sets the new standard 
for all of us for what we need to do to be sympathetic not only to the 
principles of the constitutional founding of this Nation, but 
sympathetic to the future of this great country. That's what we're all 
about here tonight, we're about growth, the future, where we're going 
to go.
  And what we're very disappointed in is the bill that came before this 
body today. I think that there were intentions here that were meant to 
help people that were in homes to be able to stay there, but the 
unintended consequence could be that we could be killing the housing 
industry once and for all.
  We've seen a proposal from our President that said that he wants to 
limit mortgage interest deductions for people that have a combined 
gross income of $250,000 or more. That may seem like a great thing. 
That may seem like those are people who can well afford their homes and 
don't have to pay for interest deductions. Well, one thing that we know 
will happen, in all likelihood, from what we've seen in history when 
the luxury tax was introduced back in the late eighties, immediately 
what happened is we saw the boat industry go down, we saw the fur 
industry go down, we saw the jewelry industry go down. Well, so what we 
might say. The ``so what'' is that average normal Americans lost jobs 
by the droves. And so immediately Congress had to come back and reverse 
that ill-thought out legislation so that we could bring those economies 
back online, and they did.
  Now, once again we're seeing history repeat itself. And we're very 
concerned because we're seeing not only an attack on people who have 
managed to be able to create wealth and who have managed to have 
capital formation--that's the genius of the United States, private 
capital formation; you're able to collect money that belongs to you, 
hold on to it, use that money, put it at risk, create a business, 
create a service, create products that help all Americans and people 
around the world. That's the genius of the United States.
  Private ownership of property. What did cramdown do today? It did 
just the opposite. It eviscerated pillars that exemplify American 
exceptionalism, and it's this; it eviscerates the sanctity of the 
private contract and it eviscerates the rule of law. What are we 
without the rule of law? What are we without private contract?
  When a person goes to a bank and asks for a loan to buy a home, when 
that happens, that's a private contract between a borrower and between 
the lender. Today, this body, the United States Congress, said no to 
those private contracts. It said that now an American can go ahead and 
go and file in a bankruptcy court, and a bankruptcy judge could open up 
that private contract and reset the terms, completely reset the terms. 
What will that mean? That will mean, in the future, what lender in 
their right mind is going to lend to someone to buy a house if they 
know that a bankruptcy court will come back in and re-think this whole 
arrangement, perhaps to the detriment of the lender, and the lender may 
be left holding the bag. And if he isn't, certainly the forgotten man 
of the private taxpayer will be left holding the bag.
  This is something that I found out today that I couldn't believe. You 
can have someone literally, under this bill, buy a $1.5 million home, 
and in some of these markets--southern California, Las Vegas--you can 
easily buy a $1.5 million home. And you could have seen that $1.5 
million home lose value so that today maybe it's only worth $500,000. 
If you have that borrower go into bankruptcy court today, based upon 
today's fair market valuation, the bankruptcy court can go in, take 
your $1.5 million loan, reduce it down to $500,000. What happens to the 
borrower? They can sit in that house for 5 years. Once the 5 years is 
up, let's say that home has gone back up now, it's worth $1.5 million 
again, then the buyer can go sell that house and they pocket that 
million dollars.
  What about that million dollars? Do they have to take it on their 
income? Absolutely not, they don't; there is no income tax consequence. 
Is there a capital gains consequence? Under current law, $500,000 of 
that gain would be tax free; in other words, that borrower would just 
skate. The lender was left hanging, the taxpayer was left hanging, but 
that borrower, who was able to live in that house for 5 years, takes 
$500,000 in cap gains free, no tax consequences--what a deal if you can 
get it--and of the remaining $500,000, they pay the cap gain on that. 
Amazing.
  Mrs. LUMMIS. Would the gentlelady yield?
  Mrs. BACHMANN. Yes.
  Mrs. LUMMIS. Who is going to bail out the bank when the bank loses 
that money?
  Mrs. BACHMANN. There's only one person left at this point to bail 
out. And what the President and what the

[[Page 6583]]

majority that runs the House and Senate have said, it's up to the 
American taxpayer. It is the forgotten man of the American taxpayer who 
is the one who is on the hook for every single one of these boondoggles 
that we have seen introduced in Washington over the last 7 weeks, it is 
the forgotten man of the taxpayer.
  And what's worse, under this legislation that came through today, you 
can take what's called the Truth in Lending Act, and the Truth in 
Lending Act says something like this; if in that example that I gave of 
someone who takes a house, they buy it for $1.5 million, it's now worth 
$500,000, the bankruptcy judge says now you only owe $500,000 on this 
house, that person can go ahead and they can comb through the Truth in 
Lending Act. And if the bank that made that loan, instead of giving two 
copies of the loan to the borrower, they only give them one copy, that 
lender is in violation of the Truth in Lending Act. Do you know what 
that means? That means that the lien that the bank has against that 
house, it goes away because the bank missed a technicality. So that 
because the bank missed a technicality, that person with the $1.5 
million home that they're now getting for $500,000, they've just gotten 
a free home. I mean, they owe nothing on it because that bank has just 
lost their loan that they had, their lien on the property, and this 
borrower skates away.
  Here's another thing that's even worse. Let's say that guy or girl 
had a $1.5 million home, they take out a home equity line of credit for 
$1.5 million against that house, they go out, they buy a yacht, they 
buy a BMW, they take their kids and they go down to Orlando, they do 
any number of things, so they take that money and they spend it. Guess 
what? Same result. They will owe nothing because if not every jot and 
tittle of that Truth in Lending Act is followed, that borrower cannot 
only see their loan principal reduced, they can see it vanish and go 
away.
  This is beyond belief. It reminds me of that television show ``Deal 
or No Deal,'' you know. You keep looking to see if some banker has 
violated some technical provision so you can get a free house. It seems 
like we're now in the business of turning normal Americans into crooks, 
where we're going to encourage normal Americans to just stop making 
payments on their home. Why? Because they can get a better interest 
rate; they can get a reduced principal; they can get terms that are up 
to 40 years with zero interest. Just think of the inducements. 
Shouldn't we be inducing Americans to make growth decisions, good 
decisions?
  These are graveyard economics for the future of our country. And 
think of the lessons that we're giving to the next generation about how 
to conduct your financial affairs.
  Mr. McCLINTOCK. Would the gentlelady yield? Just a question. You 
brought up a great point a minute ago where the massive borrowing takes 
money away from private business. Do you think that what we've done 
here in the last 7 weeks has been a job creator or a job killer when 
that much capital goes out of the market?
  Mrs. BACHMANN. Doctor, what would you think? I mean, this will be a 
job killer. As I said, this is graveyard economics. We will not only 
see, I believe, a continued diminution, if we follow the Obama 
administration's new calculus on the economy, we will see our senior 
citizens, I believe, continue to reduce the valuation in their 401(k)s. 
That's not the future I want to see.
  I will yield to the gentlelady from North Carolina.
  Ms. FOXX. Thank you, Mr. Speaker. I yield back.

                          ____________________