[Congressional Record (Bound Edition), Volume 158 (2012), Part 2]
[House]
[Pages 1920-1921]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           ROLE OF GOVERNMENT

  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
Tennessee (Mr. Duncan) for 5 minutes.
  Mr. DUNCAN of Tennessee. Mr. Speaker, Tony Blair was the Prime 
Minister of Great Britain and was considered to be a political liberal, 
and perhaps his actions didn't always match his words, but I would like 
to read a statement he made at one point. Mr. Blair said:

       The role of government is to stabilize and then get out of 
     the way as quickly as possible. Ultimately, the recovery will 
     be led not by the government but by industry, business, and 
     the creativity, ingenuity, and enterprise of people. If the 
     measures you take in responding to the crisis diminish their 
     incentives, curb their entrepreneurship, and make them feel 
     unsure about the climate in which they are working, the 
     recovery becomes uncertain.

  That was Tony Blair.
  Then Thomas Donohue, the president of our national Chamber of 
Commerce, said at a jobs summit about a year and a half ago here in 
Washington:

       The regulatory activity presently going on is so far above 
     and beyond anything we have ever seen in the history of this 
     country, that we are in danger of becoming a government of, 
     by, and for the regulators instead of a government of, by, 
     and for the people.

                              {time}  1030

  I thought of these two things when I read a letter recently from one 
of my constituents who runs a small bank in east Tennessee. He wrote to 
me. He said:

       One of the single greatest needs of small business is 
     access to capital, and much of that small business lending 
     capital is typically provided by America's more than 6,700 
     community banks. Yet, community banks are by and large being 
     forced to withhold and constrain lending at the time America 
     needs it most. This is largely due to unprecedented onerous 
     regulatory constraints being placed on community banks by 
     Federal bank examiners.

  He goes on and says this:

       Never in modern history have banks, especially community 
     banks, been under great pressure by banking regulators. Much 
     of that pressure is unprecedented, virtually ignoring or 
     redefining historic standards and definitions of bank 
     examining. Routinely, banks are being required by bank 
     examiners to classify and put into a nonaccrual status loans 
     that are current on their payments. In many cases, this be 
     can far more than half of all of the classified loan assets. 
     This is enormously inconsistent with historic bank 
     examination practices.

  And I go on, quoting from this letter:

       In most cases, this results in a bank's capital being 
     constrained and consequently may well lead to a forced merger 
     of these banks by the Fed into the larger banks. Despite 
     acknowledgement by the Fed that the two big banks represent a 
     systemic threat to the U.S. and global banking systems, the 
     big banks seemingly are allowed to keep getting bigger.

  That is a serious problem. It was the too-big-to-fail banks that got 
us into the mess that we got into in the first place, and now many of 
the smallest banks in this country are being forced out of existence or 
forced to merge. So the big keep getting bigger and the small and the 
medium-sized ones are having a real struggle to survive.
  Finally, this bank who wrote to me said:

       If America is going to have economic recovery and jobs 
     depend on it, banks must not only be allowed to lend, but 
     encouraged to lend. Instead, they are largely being 
     constrained from lending with much of that constraint 
     attributable to overly aggressive bank examination. By and 
     large, most U.S. banks are having to shrink in size in 
     response to the Fed's pressure, which translates into reduced 
     lending.

  We have been going through a period of time in which President Bush 
and his Secretary of the Treasury at the tail end of their 
administration started saying this and then President Obama and his 
Secretary of the Treasury then saying it. They have been saying loan, 
loan, loan, and then the local bank examiners having been saying no, 
no, no, and it has been holding us back. This country could be booming 
beyond belief right now, but we're holding it

[[Page 1921]]

back in so many ways, and we will never come out and have a full and 
complete recovery unless that atmosphere changes.
  I heard a talk this morning by Governor Mitch Daniels of Indiana, and 
he said that our employment rate is less than 64 percent now. He says 
that is the lowest it's been since the era of stay-at-home moms. He 
said over a third of adult children are now living at home with their 
parents, which is way above what it has been in the past. In fact, we 
have an unemployment rate that is far too high, but our underemployment 
rate is perhaps even much higher. All across this country you have 
college graduates who are working as waiters and waitresses in 
restaurants or in other low-paying jobs because they have gotten 
college degrees and can't find good jobs because we've sent so many 
good jobs to other countries in recent years and because our regulatory 
environment is holding this country back and keeping it from booming as 
it should be right now.

                          ____________________