[Congressional Record (Bound Edition), Volume 155 (2009), Part 6]
[House]
[Pages 8118-8127]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              {time}  1315
  SENSE OF CONGRESS REGARDING BONUSES PAID BY AIG AND OTHER COMPANIES 
                      RECEIVING FEDERAL ASSISTANCE

  Mr. FRANK of Massachusetts. Mr. Speaker, I move to suspend the rules 
and agree to the concurrent resolution (H. Con. Res. 76) expressing the 
sense of the Congress regarding executive and employee bonuses paid by 
AIG and other companies assisted with taxpayer funds provided under the 
Troubled Assets Relief Program of the Secretary of the Treasury.
  The Clerk read the title of the concurrent resolution.
  The text of the concurrent resolution is as follows:

                            H. Con. Res. 76

       Whereas the Chairman of the Federal Reserve, Ben Bernanke, 
     said in testimony to Congress on March 3, 2008: ``If there is 
     a single episode in this entire 18 months that has made me 
     more angry, I can't think of one, than AIG. AIG exploited a 
     huge gap in the regulatory system; there was no oversight of 
     the financial products division. This was a hedge fund 
     basically that was attached to a large and stable insurance 
     company, made huge numbers of irresponsible bets, took huge 
     losses. We had no choice.'';
       Whereas, on March 15, 2009, Chairman Bernanke said on the 
     news program ``60 Minutes'' that ``we must address the 
     problem of financial institutions that are deemed too big--or 
     perhaps too interconnected--to fail. Given the highly fragile 
     state of financial markets and the global economy, government 
     assistance to avoid the failures of major financial 
     institutions has been necessary to avoid a further serious 
     destabilization of the financial system, and our commitment 
     to avoiding such a failure remains firm.'';
       Whereas the Treasury and the Federal Reserve have committed 
     almost $200 billion in various forms of taxpayer assistance 
     to AIG for the company's liquidity shortages, the purchase of 
     certain assets, and to dispose of other assets for an orderly 
     wind-down of the company;
       Whereas the commitment of almost $200 billion in taxpayer 
     assistance represents one of the largest Federal government 
     rescues of a single private corporation in United States 
     history;
       Whereas the Federal Reserve has committed tens of billions 
     of taxpayer dollars in a combination of facilities to 
     purchase AIG's mortgage-backed securities and liabilities 
     tied to collateralized debt obligations;
       Whereas the Federal government has taken a 79.9 percent 
     stake in AIG in exchange for providing financial assistance 
     extending credit;
       Whereas, under the Emergency Economic Stabilization Act of 
     2008, the Bush Administration and the Obama Administration 
     have provided AIG with access to $70 billion in direct 
     capital infusions, which in turn have been used, in part, to 
     cover AIG's collateral for positions taken by the company in 
     unregulated and risky credit default swaps;
       Whereas AIG's Financial Products division's irresponsible 
     practice of not setting aside sufficient capital to cover its 
     exposure on more than $1 trillion of complex financial 
     products, including credit default swaps, have threatened the 
     stability of the financial system and resulted in substantial 
     losses to the company, to pensioners, to investors, and 
     ultimately to the taxpayer;
       Whereas, despite the irresponsible actions of AIG 
     executives that threatened the company as a going concern, 
     and exposed taxpayers to almost $200 billion to cover losses 
     from excessive risks, these executives will receive hundreds 
     of millions of taxpayer money in retention payments and 
     bonuses for performance in 2008 and 2009;
       Whereas, in a letter to Treasury Secretary Geithner, AIG 
     CEO Edward Liddy said that ``AIG also is committed to seeking 
     other ways to repay the American taxpayers for AIG Financial 
     Products retention payments.'';
       Whereas, in the same letter, Liddy said that ``AIG's hands 
     are tied. Outside counsel has advised that these [retention 
     payments] are legal, binding obligations of AIG, and there 
     are serious legal, as well as business, consequences for not 
     paying. Given the trillion-dollar portfolio at AIG Financial 
     Products, retaining key traders and risk managers is critical 
     to our goal of repayment [to the taxpayer].'';
       Whereas the appropriate committees in the House of 
     Representatives and the Senate have already convened hearings 
     to examine the sizable government assistance provided to AIG, 
     and the House Financial Services Committee has focused its 
     oversight on the excessive compensation provided AIG's 
     executives and employees, among other matters;

[[Page 8119]]

       Whereas common sense dictates that a company such as AIG 
     that was so mismanaged as to threaten the stability of the 
     financial system of the Nation and that requires billions of 
     dollars of taxpayer money for its survival should not reward 
     that mismanagement through lavish bonuses; and
       Whereas, on March 15, 2009, President Obama stated: ``In 
     the last six months, AIG has received substantial sums from 
     the U.S. Treasury. I've asked Secretary Geithner to use that 
     leverage and pursue every legal avenue to block these bonuses 
     and make the American taxpayers whole'': Now, therefore, be 
     it
       Resolved by the House of Representatives (the Senate 
     concurring), That it is the sense of Congress that the 
     President is appropriately exercising all of the authorities 
     granted by Congress under the Emergency Economic 
     Stabilization Act of 2008, and any other Federal law, by 
     taking all necessary actions to ensure that--
       (1) in the absence of a voluntary decision by AIG employees 
     and executives to forego their contractual retention bonuses, 
     AIG will repay taxpayers for the hundreds of millions of 
     dollars the company provided to executives and employees in 
     retention bonuses;
       (2) going forward, companies that receive a capital 
     infusion under title I of the Emergency Economic 
     Stabilization Act of 2008 that the Secretary of the Treasury 
     deems necessary to restore liquidity and stability to the 
     financial system of the United States are prohibited from 
     providing to executives and employees unreasonable and 
     excessive compensation payments that are not directly tied to 
     performance measures, such as repayment of the companies' 
     obligations to the taxpayers, profitability of the company, 
     adherence to appropriate risk management, and transparency 
     and accountability to shareholders, investors, and taxpayers; 
     and
       (3) companies that receive a capital infusion under title I 
     of the Emergency Economic Stabilization Act of 2008 that the 
     Secretary of the Treasury deems necessary to restore 
     liquidity and stability to the financial system of the United 
     States are complying with the letter of the provisions 
     included in the American Recovery and Reinvestment Act that 
     strengthen executive compensation restrictions for recipients 
     of capital infusions, such as limiting base salaries for 
     executives to no more than $500,000 per year, banning golden 
     parachutes, limiting bonuses for executives, requiring 
     shareholders to approve pay packages, requiring executives to 
     certify they are meeting the law's restrictions, requiring a 
     company-wide policy on luxury expenditures, and prohibiting 
     compensation on the basis of excessive risks that threaten 
     the viability of such companies, and adhering to all 
     executive compensation guidelines the Secretary of the 
     Treasury may establish.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Massachusetts (Mr. Frank) and the gentleman from New Jersey (Mr. 
Garrett) each will control 20 minutes.
  The Chair recognizes the gentleman from Massachusetts.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield myself such time as 
I may consume.
  Mr. Speaker, there is a great deal of anger in the Nation, and it is 
reflected in this House, which is representative of the Nation, about 
retention bonuses given to people who worked at AIG. Retention bonuses 
in this situation, Mr. Speaker, strike me as a form of legalized 
extortion. These are not performance bonuses. I was unclear about that 
and misspoke about it to some extent. These are bonuses paid solely so 
that people who had been employed at AIG would not leave AIG as it 
became clear the company was in trouble.
  Specifically, we were told that these retention bonuses go to 
employees who were engaged in complex financial transactions. Now it 
is, in sum, these complex financial transactions that caused the 
company the problem. The insurance entities, regulated by State 
insurance regulators, caused no problem. In fact, they generated the 
resources and the revenues that allowed these other people to get 
themselves in trouble.
  According to Mr. Liddy, who was appointed to head AIG after the 
failure, a decision was initiated by the Federal Reserve last September 
to lend them money and then make a change in the company's management. 
Mr. Liddy said he was afraid--and he is genuinely sincere about this--
he was afraid that some of these people who had been working at the 
company and who had intimate knowledge of these complex transactions 
would leave the company and might, in fact, even use their knowledge in 
ways that would be adverse to the company.
  That is a very sad commentary on them. These are people who were 
engaged in these transactions, the effect of which was to put the 
company in trouble. And we are told that they have to be bribed not to 
abandon the company in their time of trouble.
  Now, I am skeptical that the best way to get out of the hole that 
those people dug was to let them get extra pay for wielding the shovel. 
I believe there could have been other people hired. My colleague, Mr. 
Capuano, did some good questioning in this. We were told AIG felt, no, 
they had to pay the bonus. I think that is a very grave error.
  My own preference is, and I have urged this on the administration, my 
preference is that they bring a lawsuit on behalf of the U.S. as the 
major shareholder so that we can recover here; that is, it is not a 
case of us as a regulator intruding on a contract by others. This is a 
case where we are the major owners of this company. And I believe that 
it is a grave error to enrich people who have apparently threatened to 
leave the company, abandon it and not help them get out of the problems 
they created unless they are given these bribes called ``retention 
bonuses.'' We have a resolution here which talks about several things.
  First, it does express our determination to prevent these from 
happening in the future. We have already done some of that. We should 
note, this provision here, this decision was made unilaterally by the 
Federal Reserve system under a 1932 statute. There was no congressional 
input whatsoever into the decision last September to do this. The 
Secretary of the Treasury, Mr. Paulson, accompanied me, the chairman of 
the Federal Reserve, Mr. Bernanke, and they came to Congress, and they 
said that Mr. Bernanke had decided to give a loan of $85 billion to 
this company. No restrictions were put on the company. Two days later, 
the same two gentlemen asked us to enact legislation providing for $700 
billion in authority.
  At that point, we said, among other things, there has to be some 
restrictions on the compensation paid. Now we didn't get all the 
restrictions we wanted because we were in the negotiation process. But 
it was instructive that when the Fed did it on its own with the 
Secretary of the Treasury's support, there were no restrictions on 
compensation. Two days later, we immediately raised that, had a debate 
and got some of them. Now, we have gone further.
  I would make this contrast. We have AIG without any restrictions. 
Under the TARP program, which Congress voted and which is now being 
administered by the current administration, we have not only imposed 
restrictions, we are now being criticized in the press and by some of 
the recipients for being too tough on them. In the New York Times last 
week, there was a front page article that said the banks are going to 
have to give the money back because we are too tough on compensation, 
lavish entertaining and too much pressure to make loans. There was an 
article in the Washington Post business section 3 days ago making the 
same point. I welcome that kind of criticism. I welcome the recognition 
that we have now become very tough. The problem is that these bonuses 
were granted under an authority that the Federal Reserve gave before 
Congress got into the situation and were able to put on the 
restrictions. This resolution is a beginning of what we will be doing.
  There is also, I hope, going to be a lawsuit. I have been pressing 
the administration for a shareholders' lawsuit to recover the bonuses 
that have already been paid. And there will be other legislative 
vehicles. I hope that the Committee on Financial Services will mark up 
a bill next week which will embody much of what is in this resolution. 
We will have a markup in committee. I hope we will be able to bring a 
bill to the floor that will deal with this both prospectively and 
retroactively. At this point, this is a statement of intention which I 
think is appropriate because people in this country want to know what 
we are doing. It will be followed up by a markup in committee.
  We have had several hearings on the subject of compensation and a big 
one

[[Page 8120]]

on AIG, obviously, yesterday. And we will have another AIG hearing next 
week with the Secretary of the Treasury and the Chairman of the Federal 
Reserve. But we will be marking up legislation next week in committee 
and voting on it the final week before the recess so that what we state 
here as our intention I hope will become law.
  I reserve the balance of my time.
  Mr. GARRETT of New Jersey. I thank the Chair. At this time, I yield 4 
minutes to the gentleman from Alabama (Mr. Bachus).
  Mr. BACHUS. Mr. Speaker, I rise in strong opposition to this 
resolution. Like the American people, I'm extremely disappointed by the 
recent news that AIG paid millions of dollars in money bonuses after it 
received a massive government bailout. We all agree that the decisions 
that led to the collapse of AIG and the payment of large bonuses to 
some of the same executives who caused the collapse are indefensible.
  However, the legislation we vote on today arrives at conclusions 
based not on facts, but rather, is focused on delivering political 
cover to my Democratic friends and colleagues. The bill reads, ``It is 
the sense of the Congress that the President is appropriately 
exercising all of the authorities granted by Congress.''
  How can we come here today after all we and the American people have 
learned this week and say that everything the President has done is 
appropriate? The American people recognize the absurdity of such a 
statement, and so should we. In reality, there is not a single Member 
of Congress who can say with certainty that the President has done 
everything in his power in connection with these bonuses.
  For instance, just today, Bloomberg quotes the Senate Banking 
Committee Chairman Chris Dodd as saying that the Obama administration 
asked him to insert a provision in last month's $787 billion economic 
stimulus legislation that had the effect of authorizing AIG's bonuses. 
If that is correct, do you really want to vote to say that what the 
President did in enabling these bonuses was appropriate? I think not.
  We are here today because the majority is trying to paper over its 
mistake. And now, they are asking us to compound that mistake by 
endorsing everything the President had done in connection with these 
million-dollar bonuses. It was a mistake not to read the stimulus 
package before you voted on it. You didn't read it. You didn't 
understand it. It had this provision in it. How could we, in good 
conscience, support legislation lauding the President's actions in 
allowing these bonus payments if it was that same administration that 
worked to enact legislation that now prevents us from recouping this 
$160 million dollars?
  Such a vote would be a vote of confidence for an administration whose 
actions in handling the AIG matter have not earned the confidence of 
the American people.
  Make no mistake, today's vote is not an effort to ensure oversight 
nor an effort to hold people responsible for their actions. Today's 
vote, instead, I conclude by saying, is a thinly veiled political ploy 
by the Democratic majority to deflect responsibility. That is wrong. 
The American people know it. Working families deserve better. They 
deserve an exit strategy from this continued cycle of government 
bailouts. And they deserve to be repaid 100 percent. They don't deserve 
a cover-up.
  Mr. FRANK of Massachusetts. I yield myself such time as I may consume 
to say I learn a lot in this job. Now, I have learned about a theory 
called creationism which in some cases holds that the world was created 
4,000 years ago or 7,000 years ago by calculating what the Bible said. 
But I now am astounded to see a new and more compressed theory of when 
the world was created. It apparently was created at noon on January 20, 
2009.
  You just heard someone say, ``it is Obama's fault.'' In September of 
2008--and I regret that we are getting into this kind of political 
discussion--but the gentleman from Alabama raised it. In September of 
2008, two appointees of George Bush came to the Congress and said, Mr. 
Bernanke, the Chairman of the Federal Reserve, who had previously been 
on the Bush economic advisory staff, and Mr. Paulson, the Secretary of 
the Treasury, and they said, ``we are going to lend $85 billion through 
the Federal Reserve to AIG.'' They didn't ask us.
  Mr. BACHUS. Will the gentleman yield?
  Mr. FRANK of Massachusetts. Yes.
  Mr. BACHUS. The economic stimulus package----
  Mr. FRANK of Massachusetts. No, I'm sorry. I will yield to talk about 
what I am talking about. I take back my time.
  Mr. BACHUS. The language was inserted in that bill last night.
  Mr. FRANK of Massachusetts. Mr. Speaker, please instruct someone who 
should know better about the rules. I took back my time. The point is 
this: He had the chance to make his argument. He wanted to make it 
political. Yeah, there was something in the stimulus package. Before 
the stimulus package, there was September of 2008. It does exist. Your 
revisionism doesn't work.
  I would say to my friends on the other side, Mr. Speaker, in 
September--I note, Mr. Speaker, how sensitive the subject is that I 
raised. I got one sentence into describing the role of the Bush 
administration, and up comes my colleague from Alabama, because they 
don't want this to be discussed.
  In September of 2008, George Bush's two top economic appointees came, 
and Mr. Bernanke informed us that he was going to lend $85 billion to 
AIG. I said, at the time, because he said ``we have obligations all 
over the world here, and we have to make our foreign partners know that 
this is not going to be a default on them.'' I said, ``well, are they 
contributing?'' I asked them at the time, ``will there be any 
contribution from foreign banks to make up what AIG owes?'' The answer 
was ``no.'' So from September of 2008 until January 20, 2009, the Bush 
administration was in charge of this.
  Mr. GARRETT of New Jersey. Would the gentleman yield on that one 
point?
  Mr. FRANK of Massachusetts. I will yield again to your sensitivity.

                              {time}  1330

  Mr. GARRETT of New Jersey. It is not to my sensitivity, just that 
since you are throwing out the dates, you said from September until 
January.
  Mr. FRANK of Massachusetts. January 20, yes.
  Mr. GARRETT of New Jersey. Is it not true that somewhere in between 
there, approximately on November 10, there was a restructuring that was 
done from the $85 billion initially, and the gentleman is correct when 
you said it initially came from the Fed, but restructuring was done 
perhaps at the request because of the credit ratings and what have you, 
and they needed to change the terms, and that the funds then came in 
part from TARP; is that correct?
  Mr. FRANK of Massachusetts. Yes. I will reclaim my time to say that 
the gentleman has just reaffirmed what I said. I said it was the during 
the Bush administration.
  I just reclaimed my time. Do Members not understand the rules on the 
other side? I yielded twice. I reclaimed my time, Mr. Speaker.
  The SPEAKER pro tempore. The gentleman from Massachusetts has the 
time.
  Mr. FRANK of Massachusetts. I got briefly into my response. Two of my 
colleagues have now jumped up because they don't want the story to be 
told. I said that it was under the Bush administration.
  The gentleman from New Jersey got up, and, frankly, I thought he was 
going to say, ``Oh, no, that was the Federal Reserve, they are not 
technically the Bush administration.''
  Instead, what he wanted to do was to drive home my point and say it 
wasn't just the Federal Reserve, it was the Department of Treasury in 
November 2008. Who was running the Department of Treasury? Bush 
appointees. So I accept the gentleman's correction. I should have been 
more clear that it wasn't just the Federal Reserve, it was also the 
Secretary of the Treasury and there was a restructuring.

[[Page 8121]]

  The Bush administration was in control from September of 2008 until 
January. The decision to lend the money with no restrictions on 
compensation was a Bush administration decision.
  Now, when we had to vote on the rescue plan, we did insist on some 
compensation restrictions. They were grudgingly applied. Under the 
current administration, we have greatly expanded these. If, in fact, we 
had covered the restrictions--well, the restrictions, let's just put it 
this way, that are now in place on the rescue plan are so tough that 
people want to give us the money back. The recovery plan, we said they 
could give the money back.
  But the point is that yes, in November of 2008 it became even more of 
a Bush administration situation because Treasury had a larger role.
  I would yield again to the gentleman.
  Mr. GARRETT of New Jersey. I appreciate the gentleman yielding.
  The point that I was about to make on completion of that was that 
yes, it was the Bush administration, his Secretary in November, 
November 10, 2008, who did the restructuring to help the situation move 
along. But they were not able to do that unilaterally, were they? In 
other words the TARP money that they spent, they didn't just pull that 
out of thin air like the Fed when they created money, they had to do 
that by requesting the House and the Senate to pass TARP legislation. 
My question to you was: Did that go through the House and who was it 
that sponsored the TARP legislation that provided the money?
  Mr. FRANK of Massachusetts. The answer is the gentleman appears to 
have forgotten. How did it go through? Yes, the TARP legislation, 
requested by the Bush administration, did pass the House with the 
support of a majority of Democrats and a minority of Republicans, but 
supported by the Republican leadership.
  Excuse me.
  Mr. Speaker, let me explain to the gentleman, when you are 
recognized, you can speak. If you are not the one who is recognized, 
you ask someone to yield. If he yields, as I have done to you twice, 
you can speak. If he doesn't yield, you wait until someone does. It is 
an orderly process.
  Now, again, I understand that this is an unusual degree to which I am 
being asked to yield because the Members on the other side want to make 
a partisan attack and not have the facts. The facts are--no, I will not 
yield to a continued kind of pattern of interruption because Members 
don't want the story told. I listened to the gentleman. He asked about 
how the TARP bill was passed. The Bush administration lobbied for it 
strongly. The Republican leadership of the House supported it, although 
a slight majority of the Members voted against it. A heavy majority of 
Republicans in the Senate passed it. So the TARP bill did pass with a 
majority of Republicans in the Senate, the Republican leadership in the 
House, and Democratic majorities in both Houses, and the Bush 
administration. It was genuinely bipartisan.
  It included some restrictions on compensation, less than I would have 
liked because Republicans in the Senate, working with the Bush 
administration, resisted them.
  We have since increased both the types of restrictions and the 
levels. So the answer to the gentleman's question: yes, the TARP bill 
did pass at the request of the Bush administration with support from 
the House Republican leadership, which I notice is conspicuously off 
the floor now to avoid embarrassment, and the majority of Republicans 
in the Senate. But that's the point, Mr. Speaker, this was initiated by 
the Bush administration, and the decision to give the TARP money 
without any restrictions came from the Bush administration.
  I reserve the balance of my time.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1 minute to the 
gentleman from Nebraska (Mr. Terry).
  Mr. TERRY. Mr. Speaker, the level of hypocrisy is astounding here. 
The resolution before us asks us to agree by our vote that the 
President is properly exercising all of the authorities granted to him 
by the Emergency Economic Stabilization Act, which did ban bonuses and 
golden parachutes.
  What we do know is, the conference report, which was on a complete 
partisan basis adopted and signed by the President, had protection of 
bonuses to AIG written into it.
  Now what we don't know is how the language that was previously in the 
stimulus was taken out in conference secretively and this language put 
in. We do know that Senator Dodd was part of it because he has come out 
publicly and said I accept responsibility for putting this language in.
  Now, we don't know who came----
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. GARRETT of New Jersey. I yield the gentleman an additional 15 
seconds.
  Mr. TERRY. So we know that Senator Dodd put this language in, but we 
don't know at whose request. But he has said at the President's 
request, probably through Geithner. So I can't in good conscience vote 
for this saying what the President has done through Secretary Geithner 
is appropriate.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield 2 minutes to a 
member of the Financial Services Committee, the gentlewoman from Ohio 
(Ms. Kilroy).
  Ms. KILROY. Mr. Speaker, the great Winston Churchill said, ``The 
price of greatness is responsibility.'' AIG has shown that for them the 
price of greatness is greed, putting greed above greatest, putting 
self-interest above responsibility.
  Today I rise in support of this resolution and to express the will of 
the American people to stop rewarding this behavior.
  Let me be clear: We should focus on the behavior of AIG and those 
traders that were nothing more than gamblers, gambling in credit 
default swaps not in cards. But in the end, they gambled away the 
financial security of our markets. And when they failed and put the 
financial system at risk, the risk was pushed back onto the backs of 
the American people. America has had enough.
  Instead of taking responsibility for the massive damage they have 
caused, AIG has continued this culture of greed. Today, in this 
resolution, we can tell these traders that business as usual is over. 
We don't care about their excuses and contracts. Contracts are, 
frankly, renegotiated every day. We care about cleaning up this mess 
and changing the culture that caused this debacle.
  This resolution states our intent that without a voluntary decision 
by AIG employees to give the bonus money back, we will act to make them 
do so.
  Today we hear that some employees have been shamed into giving back 
this money. Some is not good enough. All is the only option.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1 minute to the 
gentleman from Utah (Mr. Chaffetz).
  Mr. CHAFFETZ. Mr. Speaker, the resolution before us is offered by the 
gentlewoman from Ohio (Ms. Kilroy). I am hopeful she will answer a 
question or two about the actual bill she has sponsored.
  Ms. Kilroy, would you mind answering a question about the bill that 
you are sponsoring? I would like to enter into a colloquy with Ms. 
Kilroy.
  Ms. Kilroy, you are the sponsor of this bill having enabled this 
language and voting in favor of the stimulus bill.
  The SPEAKER pro tempore. The gentleman from Utah should direct his 
remarks to the Chair.
  Mr. CHAFFETZ. Mr. Speaker, I would just like to ask a question of the 
woman who just spoke.
  The SPEAKER pro tempore. The gentleman from Utah should direct his 
remarks to the Chair.
  Mr. CHAFFETZ. Mr. Speaker, do we know why she walked away? I just 
wanted the ability to ask a question about the bill that she sponsored.
  The SPEAKER pro tempore. The gentleman from Utah has the time.
  Mr. CHAFFETZ. Mr. Speaker, I have a question about why she walked 
away.
  The SPEAKER pro tempore. Does the gentleman have a parliamentary 
inquiry?
  Mr. CHAFFETZ. I was trying to ask the Speaker why the gentlewoman 
would walk away from the microphone

[[Page 8122]]

when I simply wanted to ask a question.
  The SPEAKER pro tempore. The gentleman from Utah has the time. Does 
the gentleman from Utah have a parliamentary inquiry?
  Mr. CHAFFETZ. The question that I had, Mr. Speaker, is had the 
gentlewoman actually read the stimulus bill before she voted on it?
  I wanted to ask the gentlewoman if it was her opinion that the 
administration is doing everything it should to prevent these bonuses 
from going through?
  I also wanted to ask the gentlewoman did these bonuses happen under 
their watch?
  Finally, I wanted to ask her, Didn't the White House ask Senator 
Dodd?
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. FRANK of Massachusetts. I reserve the balance of my time.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1\1/2\ minutes to the 
gentleman from Delaware (Mr. Castle).
  Mr. CASTLE. Mr. Speaker, I have followed all of the discussion, and I 
understand the first vote is an instrumental vote and it actually does 
something.
  This particular resolution I don't understand at all. Essentially, as 
I see it, it is a cover-up vote for the administration saying they did 
everything right. I don't disagree that there were problems in the 
previous administration. There are problems in this administration with 
all of this. There are a lot of problems in Congress, and perhaps with 
AIG. But to suggest that this administration has done everything 
correctly is just not accurate. It was Mr. Geithner, after all, when he 
was the head of the New York Federal Reserve and made the first payment 
to AIG in which they received most of the stock of AIG who was involved 
from that point on. It was his people who were involved from that point 
on.
  There were discussions recently in the stimulus package about who 
actually took out the language with respect to allowing these bonuses 
to take place because there was language apparently put in by the 
Senate that would have prohibited that. And again, the White House was 
apparently involved in that.
  Then there were discussions as to when everybody knew about this. And 
Mr. Geithner apparently indicated that he was informed I guess late 
last week and then informed the President. And yet we heard from Mr. 
Liddy at AIG that the Federal Reserve was involved with this from the 
beginning and knew about it from the beginning, and he assumed probably 
shared that information with Treasury.
  Either way, you are talking about the administration. Individuals 
either did know or should have known, and to absolve the administration 
of fault is just wrong. And whether we vote ``yes'' or ``no'' on the 
previous bill, in my judgment everybody should vote ``no'' on this 
legislation. It is just not proper. I am not even sure why we are 
trying to consider it today, but it is not proper. It is not accurate. 
The bottom line is it should have a ``no'' vote.
  Mr. FRANK of Massachusetts. I will continue to reserve.
  Mr. GARRETT of New Jersey. I thank the gentleman from Delaware for 
his comments, and pointing out the fact that members of this 
administration, specifically Secretary Geithner was actually considered 
the architect of the AIG bailout bill.
  With that, I yield 1 minute to the gentleman from Louisiana (Mr. 
Scalise).
  Mr. SCALISE. Mr. Speaker, I am angered. The American people are 
angered. But they are not just angered by what is going on with these 
bonuses at AIG, they are also angered at what is going on right here in 
Washington, DC, and in this Capitol by people who helped create this 
mess.
  For those of us who voted against the bailout and who voted against 
the stimulus bill, we are equally angered not just at the bonuses, but 
also at the fact that this language was inserted into the stimulus 
bill.
  Senator Chris Dodd, the chairman of the Senate Banking Committee 
himself said this language, protecting AIG bonuses, was put in the bill 
because of a request from the White House.
  We deserve to know who at the White House knew about that, who at the 
White House asked for this language to be put in protecting AIG 
bonuses. And now that people are rightly angered across the country, 
they are trying to cover themselves with this language in this 
resolution which is part of this coverup.
  If Secretary Geithner knew that this language was going to be 
inserted and he helped direct it in there, he needs to resign. But the 
President needs to answer these questions to the American people who 
are rightfully angered about what is happening.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield 1 minute to the 
gentlewoman from Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Speaker, it is interesting to listen to 
my colleagues not try to be problem solvers. The work of this body is 
to in fact solve problems, fix the capital markets, ensure that we 
restore the confidence in the capitalistic system. And yes, to overcome 
mishaps and issues that raise concern with all of us.
  Today we create the opportunity and the vehicle to solve these 
problems. The taxation on retention bonuses speaks loudly on behalf of 
the American people. The expression of opposition to actions that 
occurred speaks loudly on behalf of the American people.

                              {time}  1345

  This body has many committees that will engage in oversight. My 
colleagues don't think that the work will be done--and it will 
continue--on how these issues came about, but maybe they should look at 
the past and understand the reason we are here is the $1.1 trillion 
debt that was created by the past administration. We are fixing the 
problem. Let's join those of us who want to work it out on behalf of 
the American people.
  Mr. Speaker, I rise today in support of this resolution that I 
believe only begins to express the outrage that the American people and 
many Members of Congress are feeling right now. Our constituents feel 
like they have been handed a raw deal from the executives at AIG. They 
have given out large bonuses that would make most people blush with 
shame.
  The understanding that most Members of Congress had when we passed 
the TARP legislation was that these measures were necessary to keep our 
financial system from collapse. However, the reality of a few months 
has proven quite different.
  Last month, we voted for another economic recovery package of over 
$700 billion which contained language that limited executive 
compensation for companies that received certain TARP funds.
  It appears that the AIG executives may not have broken the law but 
certainly the spirit of the law. This is unconscionable. It is an 
outrage that these businessman have bucked the system and chosen to 
dole out federally appropriated dollars to their own bank accounts. 
Where is the fairness? Where is the equity? $165 million is no small 
change.
  In other words, if AIG has received over $190 billion in funds from 
the federal fiscal coffers in the last year, the company is acting in 
broad contravention of the essence of the law to use $165 million of 
that for bonuses. The country is now $12 trillion dollars in debt after 
passage of last month's American Recovery and Reinvestment Act of 2009. 
We literally cannot afford irresponsible uses of taxpayer dollars.
  The unemployment rate is on the rise across the country. In fact, in 
my state of Texas, the unemployment rate has hit 6.4 percent. And that 
rate is even higher for minorities. Many of the people of Texas, like 
many Americans, are suffering through this economic downturn.
  By voting for this resolution we are not just voting to take the 
money back, we are voting to get our country back on the right track. 
The U.S. dollar has traditionally been one of the strongest in the 
world. But just last week, an official from China appeared to question 
the holding of U.S. paper.
  The losses that led to AIG's essential failure came largely from two 
sources: The state-regulated AIG insurance subsidiaries' securities 
lending program, and the AIG Financial Products (AIGFP) subsidiary, a 
largely unregulated subsidiary that specialized in financial 
derivatives. And is it not ironic, Mr. Speaker, that most of the 
bonuses in question went to AIG executives in those two divisions. Bad 
actors should not benefit from poor performance. The American people 
should not be required to pay for the missteps of the AIG top brass, 
particularly during a time when the unemployment rate is creeping up.

[[Page 8123]]

  Financial derivatives are products that came into the public 
consciousness during the Orange County default of 1994. Typically 
derivatives are used to diversify investment portfolios for 
institutional and retail investors. If we thought that the derivatives 
beast had been tamed--apparently we were wrong--it has roared back to 
bite us.
  The securities lending losses were largely due to investments in 
mortgage-backed securities, and are relatively well-defined at this 
point. At the end of 2008, the outstanding obligations from the AIG 
securities lending program were approximately $3 billion, down from 
over $82 billion at the start of 2008.
  The credit derivative losses from AIGFP, however, are potentially 
ongoing despite actions taken to limit them. AIG reported approximately 
$300 billion in continued notional net exposure to credit derivatives 
at the end of 2008, down from approximately $370 billion at the start 
of 2008.
  The government assistance to AIG began with an $85 billion loan from 
the Federal Reserve in September 2008. This loan was on relatively 
onerous terms with a high interest rate and required a handover of 79.9 
percent of the equity in AIG to the government.
  As AIG's financial position weakened after September, several rounds 
of additional funding were provided to AIG and the terms were loosened 
to some degree. The lessening of restrictions was necessary because of 
the overall deterioration of the economy and certain financial services 
companies.
  The second major restructuring of the assistance to AIG was announced 
in March 2009 and has yet to be completed. Once it is completed, the 
assistance to AIG will comprise: (1) Up to $70 billion in capital 
injections through preferred share purchases by the Treasury; (2) up to 
$40.3 billion in outstanding loans from the Fed; (3) up to $34.5 
billion in Federal Reserve loans retired by securities and equity 
interests provided to the government by AIG; and (4) up to $52.5 
billion in loans for troubled asset purchases--assets which are now 
owned by the government.
  In addition to possible continuing losses on AIG's derivative 
portfolio, the ongoing weakness in the economy may weigh heavily on 
AIG's future results. It is not clear whether the ongoing government 
involvement in AIG might strengthen or weaken AIG's core insurance 
business, as consumers could conclude that their policy with AIG is 
safe due to the government involvement or they could conclude that 
their policy with AIG is more risky since the government could change 
the terms of its involvement at any time.
  That is why we must, as a Congress, send a strong message to the 
American people. They need to know that when we write a bill that is 
circumvented--Congress will act quickly to address it.


                         Parliamentary Inquiry

  Mr. GARRETT of New Jersey. Mr. Speaker, parliamentary inquiry, 
please.
  The SPEAKER pro tempore. The gentleman will state his parliamentary 
inquiry.
  Mr. GARRETT of New Jersey. Is it under the rules of the House that 
the sponsor of the resolution has to be on the floor during the 
presentation of the discussions and debate on the resolution?
  The SPEAKER pro tempore. It is not required under the rules of the 
House.
  Mr. GARRETT of New Jersey. Thank you.
  Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Texas (Mr. 
Paul).
  Mr. PAUL. I thank the gentleman for yielding.
  Today, there is a lot of expression of outrage--and indeed, there 
should be.
  I don't believe that this resolution really addresses the real 
problem that we have. It looks like it's giving the administration an 
excuse by saying that he is only doing what we have asked him to do, 
and the administration. And in many ways this is true. The real fault, 
I think, falls within the Congress ever giving this money and allowing 
this to happen. But to excuse the administration and then complain 
about these bonuses and think that that can solve our problems, it just 
won't do that.
  The real outrage, I think, is the lack of monitoring of what we do; 
we give out money, we have no strings attached, we give out hundreds of 
billions of dollars, and we totally ignore what the Federal Reserve 
does by issuing literally trillions of dollars. And yet, this is the 
emergency legislation.
  This is politically driven, I happen to believe. I think people would 
like to express their outrage, and they do. And it's an easy target, 
picking on AIG, but we create these problems; we create them by doing 
things that are unconstitutional. We come up with these schemes and 
these expressions and excuses, and at the same time, we don't address 
the subject of why do we spend money, and why do we allow a monetary 
system to operate without any supervision by the Congress? That's where 
our real problem is. And someday we will address that and deal with 
this rather than doing it in the political way of saying, well, it's 
not our fault, it's their fault.
  Mr. GARRETT of New Jersey. I thank the gentleman from Texas for 
pointing out that these problems were, in fact, created through 
legislation, and that legislation came under the leadership of the 
Democrat House.
  At this time, I yield 1\1/2\ minutes to the gentlelady from Kansas 
(Ms. Jenkins).
  Ms. JENKINS. Mr. Speaker, I rise today to express the frustration 
that my constituents and I have at the abuse of taxpayer dollars.
  The American taxpayer, over the past year, has been forced to foot 
the bill with hundreds of billions to bail out bad decisions made by 
institutions that were deemed too big to fail, including AIG.
  After receiving almost $200 billion in taxpayer bailout dollars, we 
now know AIG used some $165 million to pay bonuses to many of the same 
executives who got them into this mess in the first place. These 
bonuses are outrageous; but even more outrageous is that this whole 
situation could have been avoided. During the closed-door conference 
committee meetings for the Democrat so-called stimulus bill, a 
provision was slipped in that permitted the AIG bonuses to be paid.
  The $165 million in bonuses AIG recently made must be recaptured. As 
the primary--unwilling--investors, the American taxpayers deserve to 
know how and when they will be repaid and given assurance that their 
dollars will not be squandered any further.
  The legislation voted on today will not recapture 100 percent of 
taxpayers' money, and it sets a dangerous precedent for punishing 
individuals by taxing past behavior deemed inappropriate.
  It is disappointing how this body continues to let the American 
people down.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield myself 30 seconds to 
correct the gentleman from New Jersey.
  I have long thought that I pay closer attention to our colleague from 
Texas (Mr. Paul) than his Republican colleagues. He talked about 
legislation, but he was talking about, in part, the legislation that 
gives the Federal Reserve the ability to do this.
  The gentleman from New Jersey is incorrect. This was not created by 
the TARP legislation which the Congress passed at the request of 
President Bush, it was under legislation passed in 1932 which gave the 
Federal Reserve the authority. Mr. Bernanke was acting under that 
authority. So it is true that the actual loan was made under the 
administration of George Bush, but he was acting under authority signed 
by another great Republican President, Herbert Hoover.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1\1/2\ minutes to the 
gentleman from Ohio (Mr. LaTourette).
  Mr. LaTOURETTE. Mr. Speaker, I have not seen this much gnashing of 
teeth and beating of breasts since Homer penned ``The Rape of the 
Sabine Women''.
  This is truly amazing. We are being asked to vote on a resolution 
today that says that the President is doing everything in his power to 
properly execute a program. Now, I wish I could vote ``yes'' because I 
happen to think that the President of the United States, Mr. Obama, is 
doing the best job that he can, but I can't answer that question. I 
can't answer that question. And I am going to yield to the 
distinguished chairman of the Financial Services Committee if he will 
answer the question. This is the paragraph--hold on, let me get the 
citation--title VII, section 111, subparagraph (iii).
  Somehow, when the bill left the Senate, it had the Wyden-Snowe 
language

[[Page 8124]]

that said ``no executive compensation,'' and it taxed it. When the bill 
comes out of the conference committee, it has this paragraph in it that 
makes possible the bonuses that people are so shocked about today.
  Now, I wasn't in the conference committee, I've been transferred to 
the Appropriations Committee, and so I would yield to the distinguished 
chairman of the Financial Services Committee if he would tell me--I 
assume he was a conferee--how did this get in the bill? I'll yield to 
anybody on the Democratic side. How did this paragraph get in the bill?
  This paragraph said that the government could not stop the $170 
billion worth of bonuses, and today we're taxing these bonuses at 90 
percent and we're calling these people traitors. Come on. How did this 
stuff get in the bill? And if you can't answer the question, we can't 
vote on your resolution.


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore. The Chair will remind all persons in the 
gallery that they are here as a guest of the House and that any 
manifestation of approval or disapproval of proceedings or other 
audible conversation is in violation of the rules of the House.
  Mr. FRANK of Massachusetts. Mr. Speaker, I reserve the balance of my 
time.
  Mr. GARRETT of New Jersey. Mr. Speaker, before I yield to our leader, 
I will yield such time to the chairman if he wishes to answer the 
question that the gentleman from Iowa asked, which was, how did this 
language get into the legislation which allowed for these bonuses to go 
through? He did not answer the question before, but I will yield.
  Mr. FRANK of Massachusetts. I will confess, Mr. Speaker, I was not 
paying as close attention to the gentleman from New Jersey.
  Mr. GARRETT of New Jersey. Then I take back my time.
  Mr. FRANK of Massachusetts. Would he rephrase the question?
  Mr. GARRETT of New Jersey. I take back my time. Apparently, the 
gentleman doesn't know the same rules that he was asking for one of his 
peers.
  The SPEAKER pro tempore. The gentleman from New Jersey has the time.
  The Chair would ask Members to be more orderly in yielding and 
reclaiming time. Specifically, Members should not interrupt after the 
Member under recognition has expressed an intent not to yield.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1 minute to our 
leader, the gentleman from Ohio (Mr. Boehner).
  Mr. BOEHNER. Let me thank my colleague from New Jersey for yielding.
  I can see that the political circus continues here with the second 
piece of legislation today.
  I just want all the Members to know what the first paragraph of the 
``Resolved'' clause is in this resolution. It says, ``Resolved by the 
House of Representatives, the Senate concurring, that it is the sense 
of Congress that the President is appropriately exercising all of the 
authorities granted by Congress under the Emergency Economic 
Stabilization Act of 2008, and any other Federal law.'' Are you kidding 
me?
  The Secretary of the Treasury has the ability to do this. Before he 
gave the last $30 billion--you know, that was the day after they 
reported a $61 billion loss, the Secretary of the Treasury decided they 
needed another $30 billion. And before he gave them the $30 billion, he 
couldn't have made clearer that no bonuses were going to be paid.
  So I don't know how we can put this ``resolved'' clause in this phony 
resolution here so all Members can cover their rear-ends that they have 
come to the floor and they have voted to stop all of these bonuses 
going to these AIG executives.
  This is a joke, and we ought to treat it as such. Vote ``no.''
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield myself 15 seconds to 
say that if the gentleman wants to ask me a question--I had said I 
hadn't heard it--if he would rephrase it, I will try to answer it.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1\1/2\ minutes to the 
gentlewoman from Illinois (Mrs. Biggert).
  Mrs. BIGGERT. I thank the gentleman for yielding.
  Mr. Speaker, I rise in opposition to this resolution, for I think 
it's a sham and an attempt to rewrite history.
  When I and many of my colleagues voted against the first TARP 
bailout, I did so because I thought there weren't enough taxpayer 
protections. Well, you know what? I was right. But now we find out, to 
make matters worse, the other side of the aisle made it even worse 
writing in--in secrecy in the dead of night--a provision that actually 
took away a provision that would protect the taxpayers from these 
obscene bonuses. Well, they got caught, and now they have no one to 
blame but themselves.
  When they say to 178 Members on this side of the aisle, ``it's my way 
or the highway,'' this is what they get. But my taxpayers shouldn't 
have to pay for their mistakes or their arrogance. So maybe I will call 
their bluff and maybe I will vote for their flawed legislation, which 
is too little, too late, because I want our taxpayer's money back.
  I urge my colleagues to oppose this resolution, and I worry about how 
we're going to solve this problem.
  Mr. FRANK of Massachusetts. I will continue to reserve.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1\1/2\ minutes to the 
gentleman from Texas (Mr. Hensarling).
  Mr. HENSARLING. Mr. Speaker, I thank the gentleman for yielding.
  The outrage is continued. What we have today here is nothing short of 
a legislative coverup. That's what we're looking at here, Mr. Speaker. 
And when you look at these two different proposals that have come to 
the floor, one of which would trample on the Constitution in order to 
perpetrate this legislative coverup. And now we have the spectacle of 
Senator Dodd pointing the finger at Secretary Geithner, and Secretary 
Geithner pointing the finger at Senator Dodd. But what we do know is 
that our friends on the other side of the aisle, the Democrats, could 
have prevented this. But this language got in the bill, and all of a 
sudden it has no parents. Nobody will claim where this came from, this 
magical language that somehow allows these outrageous AIG bonuses to be 
paid.
  Here's a news flash: Why don't we tell them, ``No more Federal money, 
AIG, until these bonuses are repaid?'' Don't come up with this 
political cover-your-backside language, trying to excuse all the people 
who are responsible for this in the first place. Don't trample on our 
Constitution in order to do this legislative coverup.
  What happened to supposedly the most open and honest Congress in the 
history of America? This is transparency? This is honesty? And instead, 
we have cover up. Vote it down.
  Mr. FRANK of Massachusetts. Mr. Speaker, I guess I will never get to 
answer that question, so I will yield, instead, 1 minute to the Speaker 
of the House.
  Ms. PELOSI. I thank the gentleman for yielding, and I thank him for 
his leadership in bringing this legislation to the floor and his 
ongoing leadership in protecting the national interest of the American 
people as chairman of the Financial Services Committee.
  I also want to acknowledge the leadership of Chairman Rangel of the 
Ways and Means Committee for the legislation that was debated earlier 
about how the American people can get their money back, money paid in 
bonuses for failure, money paid that belongs to the taxpayers.
  Mr. Speaker, today we are gathered on the floor to address a symptom, 
the bonuses, a symptom of the challenge that we face in our economy and 
in our financial situation in our country. I believe the President is 
on the right path and did an excellent job in his leadership when we 
passed the Recovery Act here. This Congress is moving forward with 
regulatory reform to address the lack of regulation, supervision, and 
discipline in the financial markets that brought us to this place. The 
President's initiatives on housing will help people stay in their 
homes. Addressing the housing crisis is essential to addressing the 
financial crisis in our country. And then we have to deal with

[[Page 8125]]

the stability of our financial institutions.
  In the course of doing that, with a massive infusion of cash from the 
Fed on September 16--long before some in this body were even elected to 
the Congress--the Federal Reserve transferred these funds and the many 
funds since then without any requirements or conditions.
  We come to a point where it is very clear that there are many in our 
country who believe that the way a free market system works for them, 
and not in the national interest, is to nationalize the risk and 
privatize the gain.

                              {time}  1400

  They are entrepreneurial, take risk, enjoy the benefits when success 
is there. But when it is not, these undue risks have to be paid for by 
the taxpayer, or so they think. That's just not right.
  We all believe in a free market system. We all see that capitalism 
produces jobs and creates capital, and that is important. It creates 
wealth and that's important to the success of our economy, creating 
jobs especially. But it isn't right, it just simply isn't right, when 
there is a reward, a spelled-out-in-advance reward, for those who will 
take undue risk and when they fail, they get a bonus; the taxpayer gets 
the bill. This must end.
  And today with these two resolutions, I think that we are making two 
important statements. One is that the administration should continue in 
its efforts to recover the money and prevent these bonuses from going 
forward. And the other is that we want our money back and we want our 
money back now for the taxpayers. This isn't that complicated. It isn't 
that complicated.
  There are other steps that we can take, and in working in a 
bipartisan way on the committees of jurisdiction, the Financial 
Services Committee for one, we will have other pieces of legislation 
which will ensure that this can never happen again. We're working with 
the Judiciary Committee to say when is the national interest so 
offended that it is okay, then, to revisit a contract?
  You hear all this talk about, oh, we can't revisit contracts. It's 
the Constitution. And we respect that, and we would not do so unless we 
would do so very carefully. But nobody seems to have a problem saying 
to auto workers in Michigan that their contracts must be revisited, 
that they have to take a deep cut in order to sustain an industry 
because that industry is important to our national security; we must 
have a manufacturing base and we cannot have it be undermined. So if 
the workers contracts are so subject to review and revision, why is it 
that when somebody gives a contract for a bonus to somebody for failure 
which is known not to be in the national interest that you can't even 
bring up the subject?
  Well, that isn't the subject for today in terms of legislation, but 
the subject of fairness and justice is. And I would hope that going 
forth from today, we could work strongly in a bipartisan way to address 
the real challenges to our economy and the challenge that the fragility 
of our financial institutions poses. We have to really say is it worth 
it to us to transfer hundreds of billions of taxpayer money, as 
Secretary Paulson asked us to do on September 18 when he and Chairman 
Bernanke visited the Congress? What are the results? Where is the 
credit circulating on Main Street?
  Just getting back to the bonuses for a minute, because of the failure 
of AIG and the downturn for so many other financial institutions in our 
country, our people do not have job security. They're afraid of losing 
their jobs, their homes, their pensions, the college education of their 
children. It's just not right. There is a direct connection between 
this nationalizing the risk and privatizing the gain and the economic 
security of America's families and the strength of Main Street.
  So let's take a step and say we want our money back. Here's one way 
to get it. And then let's work together to do more in that regard to 
bring justice to the system but, more importantly, to work together to 
bring stability to our economy.
  With that, I urge our colleagues to support the resolutions before 
us.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 30 seconds to a 
gentleman now who also wants to get the money back but also wants to 
find out how we got to this place in the first place, the gentleman 
from Ohio (Mr. LaTourette).
  Mr. LaTOURETTE. Mr. Speaker, I have to apologize to the distinguished 
chairman of the Financial Services Committee because apparently I 
wasn't riveting enough when I was chatting before. And I'm happy to 
restate my question, and if the distinguished Speaker hasn't left the 
floor, she as well, I assume, had a representative in the conference 
committee.
  My question was simple. These bonuses were not blocked as a result of 
this paragraph in the stimulus bill. Now, 2 days before we voted on it, 
every Democrat in the House voted to give us 48 hours to do it. You 
didn't do it. You gave us 90 minutes. You said 90 minutes is plenty of 
time. So I assume the Democrats read it. I assume the conferees who 
were in the room when this paragraph was inserted read it.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. GARRETT of New Jersey. I yield the gentleman an additional 10 
seconds.
  Mr. LaTOURETTE. My question, Mr. Chairman: How did this get in the 
bill?
  I have the same answer, but I'm glad at least we have now heard the 
question.
  Mr. FRANK of Massachusetts. Well, Mr. Speaker, I would say to my 
friend from Ohio that last remark was kind of bewildering. It wasn't my 
time. He was out of time. He seemed to be annoyed that I hadn't 
answered his question, but how I don't know how I could have done that 
except by sign language, in which I am not proficient. In my time I 
will address the question. For him to ask me a question as his time 
expires and then express indignation at my failure to answer it puzzles 
me.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BACHUS. Mr. Speaker, I ask unanimous consent to give the chairman 
15 seconds to answer the gentleman's question.
  Mr. FRANK of Massachusetts. Reserving the right to object, I'm not 
going to be told I have only 15 seconds to answer a question.
  Mr. BACHUS. Mr. Speaker, then I ask unanimous consent to give the 
chairman 1 minute to answer the gentleman from Ohio's question.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Alabama?
  There was no objection.
  The SPEAKER pro tempore. The gentleman from Massachusetts has an 
additional 1 minute added to his time.
  Mr. FRANK of Massachusetts. I thank the gentleman. I will use it and 
then reserve the balance of my time.
  I was not a member of the conference committee. The Financial 
Services Committee was not directly involved in this. We were more 
constrained by what we thought was the germaneness to the recovery 
bill. So the answer is I am not familiar with whatever the reasons were 
as to why this was put in.
  I will say this: If there had been no language whatsoever, we still 
wouldn't have had the authority. In other words, what did survive was 
additional authority. Now, if there had been no bill whatsoever, we 
wouldn't have come even this close. But as to the specific question, 
the answer is I was not involved.
  I would also just say, as chairman of the Financial Services 
Committee, I monitor pretty closely what goes on. I am not aware of any 
Republican member of the Financial Services Committee who has 
approached us and asked us to toughen up compensation restrictions. 
This interest in compensation restrictions is a fairly new interest. I 
commend people. I think later in life, it's good to take up new things 
so you don't get stale. But I do want to note that it is a fairly 
newfound hobby of my colleagues on the other side. In fact, in 
September when the Bush administration said they were going to make the 
loan with no restrictions and we pushed for it----

[[Page 8126]]


  Mr. BACHUS. Will the gentleman yield?
  Mr. FRANK of Massachusetts. I yield to the gentleman from Alabama.
  Mr. BACHUS. We're talking about this February. This resolution deals 
with your resolution that the President in February acted 
appropriately.
  Mr. FRANK of Massachusetts. Reclaiming my time, we now have the nub 
of it. How dare I mention September of 2008. We're talking about 
February. I thought the world began on January 20. Apparently it 
started on February 1.
  The fact is that you cannot look at this out of context. It was under 
the Bush administration that they initiated this loan to AIG. It was 
under the Bush administration that they asked for TARP and for our 
efforts to try to restrict compensation.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. GARRETT of New Jersey. Mr. Speaker, can I ask how much time 
remains on both sides, and was that time that just used then in excess 
of the 1 minute that was yielded to the gentleman by unanimous consent?
  The SPEAKER pro tempore. It was.
  The gentleman from New Jersey has 2\1/2\ minutes remaining, and the 
gentleman from Massachusetts has 2\1/4\ minutes remaining.
  Mr. GARRETT of New Jersey. With that, Mr. Speaker, I will yield 1 
minute to the gentleman from Texas who knows as well as Ron Paul does 
that the Federal Reserve was created during a Democrat administration.
  Mr. GOHMERT. Mr. Speaker, I heard the chairman a moment ago saying 
Bush was in charge in September. And that's correct. I was glad to hear 
that.
  But some of us back in September were begging the majority and people 
on this side of the aisle don't give $700 billion in this fashion to 
anybody, not Paulson, not Geithner, not anybody. But it passed with the 
majority of the majority voting for it.
  So it's a little difficult to come in here and say the President has 
done everything he can when President Obama's defense apparently is, 
well, Bush was bad, he used maybe $300 billion of the $700 billion; so 
we've got Obama $1.5 trillion, $1.6 trillion.
  Look, if we want to fix this so the President can do all he can, 
somebody needs to put in the teleprompter that he's directing Geithner 
to put this outfit in receivership and then go get 100 percent of the 
bonuses. Then we can talk about doing all he can.
  Mr. FRANK of Massachusetts. Mr. Speaker, I reserve the balance of my 
time.
  Mr. GARRETT of New Jersey. Mr. Speaker, I yield 1 minute to the 
gentleman from Illinois (Mr. Roskam).
  Mr. ROSKAM. Mr. Speaker, I thank the gentleman for yielding.
  A couple of minutes ago we heard from the gentlewoman from 
California, the Speaker of the House. She said this isn't complicated. 
And you know what? It's really not complicated.
  It was just a few short weeks ago that the House Republican leader, 
John Boehner, came out here with, I don't know, was it a thousand 
pages? It was a whole lot of pages in the stimulus package. And he gave 
a poignant observation, and he made a challenge and he said nobody on 
that side of the aisle has read this bill. He dropped it, and like a 
thug those pages hit. And there was silence on the other side because 
you know what? The other side, Mr. Speaker, could hardly give you eye 
contact because they hadn't read the bill. And now, lo and behold, we 
come up with one shuffling answer after another as to how it is that 
this policy gives AIG the ability to walk away with taxpayer money. The 
list of excuses knows no end.
  So the Speaker is right. This isn't complicated. This is what happens 
when we abrogate responsibility, when the Congress doesn't read bills, 
and when we create what my predecessor calls the ``greased chute of 
government.''
  Mr. FRANK of Massachusetts. Mr. Speaker, I continue to reserve the 
balance of my time.
  Mr. GARRETT of New Jersey. Mr. Speaker, we are essentially here today 
on a resolution that does nothing much more than to say congratulations 
to this administration.
  When you think about all the outrage across the country, and 
Americans should be outraged. We all want to get our money back and we 
will do everything in our power to get our money back. But the 
Americans are not only outraged at these bonuses, they are not only 
outraged at AIG and that they paid them out, but they are also outraged 
that we got here in the first place. And they know the fact that it was 
Secretary Geithner who was the architect of this. They know that TARP 
1, 2, and 3 passed under the leadership of this Democrat House without 
absolute any strings attached whatsoever. And they know that it was 
under the leadership of this House that a bill passed that pulled out 
the restrictions. And so there is no reason why we should be commending 
this administration on this matter.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. FRANK of Massachusetts. Mr. Speaker, we have passed from 
creationism to fantasy. It's interesting.
  The gentleman from Texas (Mr. Gohmert) was very critical, in fact, of 
the actions of the Republican leader. He said we begged people not to 
vote for the TARP. The Republican leader in the House last fall worked 
very hard to get it passed. So did the other members of his leadership.

                              {time}  1415

  So did the other Members of his leadership, and now he is being 
denounced for that. So I guess he broke even on his side, which these 
days, if you are in the minority, may be a pretty good day.
  But the fact is this, the gentleman from New Jersey says, well, the 
Democrats were in the majority--though he said Democrat majority. 
Pardon me, for not getting his inflection absolute. Yes, the President 
of the United States, George Bush, came and asked us to do this, and 
his two top economic advisers said if you don't do it, there will be a 
crisis.
  But, in fact, that's not directly relevant to the AIG issue. AIG was 
granted money.
  And, by the way, the gentleman from New Jersey again misstates the 
relevant statute. The statute that we are referring to, that the 
gentleman from Texas referred to, is not the original one creating the 
Federal Reserve, it's the 1932 statute that gave them the power to lend 
money as they wish, signed by another great Republican President, 
Herbert Hoover.
  But the point is that it was the Republican administration that said 
we had to do this. Yes, there was cooperation, the Republican 
leadership in the House, the majority in the Senate, believing that 
there would have been a terrible problem if it wasn't there.
  I do want to reiterate that I am now pleased, as Chairman of the 
Financial Services Committee, that there is this interest on the 
Republican side in restricting compensation. It has not previously been 
a strong part of their argument.
  However, we will return to the subject of this resolution. The 
resolution isn't binding, but it is a forerunner of what will be 
binding.
  The Committee on Financial Services will vote next week on binding 
legislation, and it will bring it to the floor the week after, which 
will embody much of this, and it will include an effort to deal with 
this retroactively. There will be legal questions raised, but the fact 
is that we will have binding legislation to embody this.
  This is an important statement. I would say this in closing, Mr. 
Speaker. We have people now at AIG deciding whether or not they are 
going to give their money back. The more they give back to us, the 
better we will be. It won't be totally conclusive.
  But to defeat this resolution because it says nice things about 
President Obama would be a grave error.
  Mr. MARSHALL. Mr. Speaker, I voted in favor of this resolution 
because no company should pay large bonuses to employees after 
receiving taxpayer funds under the Troubled Assets Relief Program. I 
agreed to the stated ``sense of Congress'' that the President is 
appropriately exercising all powers available to him because I have no 
reason to conclude otherwise. But I acknowledge the possibility that 
the President may not be doing all he can to recover the AIG bonuses. 
No Representative can know everything an Administration is

[[Page 8127]]

doing so it is therefore possible that more can be done. If more can be 
done, it should be done.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Massachusetts (Mr. Frank) that the House suspend the 
rules and agree to the concurrent resolution, H. Con. Res. 76.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. GARRETT of New Jersey. Mr. Speaker, on that I demand the yeas and 
nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

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