Kit Bond

Mr. BOND

Mr. BOND. I ask unanimous consent that the order for the quorum call be rescinded. The PRESIDING OFFICER (Mr. Begich.) Without objection, it is so ordered.

Mr. BOND. Mr. President, I ask unanimous consent to speak as in morning business for 10 minutes.

Mr. BOND. Mr. President, for weeks now we have been debating the financial reform bill, which is being sold to the American people as the solution to holding Wall Street accountable for the economic crisis that hurt every American family and business in every community across the Nation. Unfortunately, in this current form, the so-called reform bill will actually punish Main Street America, the families who suffered from and did not cause the financial meltdown. It should be a wakeup call when Lloyd Blankfein of Goldman Sachs says Wall Street will be the big winner under this bill, and we know the people who provide jobs, essentially small business, and the people who provide credit to the rest of America are warning of dire consequences. Let me make this clear. This bill was meant to rein in Wall Street. Yet it is supported by Goldman Sachs and Citigroup. It is opposed by small business and community bankers. I think that tells you all you need to know about this bill. That is why I rise today in strong opposition to cloture on this bill. Yes, we made some improvements on the bill, and I congratulate the leadership for allowing us to have amendments and debate them, and I thank and I am grateful to my colleague from Connecticut, Senator Dodd, for working across the aisle to remove an onerous provision that unintentionally would have killed small business startups. Senator Dodd has worked in good faith in a bipartisan fashion to make real changes in the bill. But despite the progress we have made, the provisions most destructive and harmful to taxpayers, families, and small business still remain. First, it is completely unbelievable and unacceptable that so many of my colleagues want to turn a blind eye to the government-sponsored enterprises Fannie Mae and Freddie Mac which contributed to the financial meltdown by buying the high-risk loans that banks were pushed to make to people who could not afford them. They were the enablers of the issuance of bad mortgages. Everyone here knows what I am talking about. Despite the bill's 1,400-plus pages, it completely ignored the 900-pound gorilla in the room. The need to reform Fannie Mae and Freddie Mac, or the ``toxic twins'' as I refer to them, is completely ignored. How can you ignore the major government-sponsored enterprises that were the enablers for the bad mortgages that brought our system and much of the world's system down? To add insult, Fannie Mae and Freddie Mac devastated entire neighborhoods and communities as property values diminished. But when they bought up loans and encouraged issuance of loans to people who could not afford them, that turned the American dream of home ownership into the American nightmare for far too many families. Fannie Mae and Freddie Mac went belly up, and now it is the very Americans who suffered from their irresponsible actions who are left footing the bill for them, because, if it were not bad enough, unless we act now to reform the toxic twins, over the next 10 years, Fannie Mae and Freddie Mac will run up hundreds of billions of dollars. Let me put that into perspective. Freddie Mac lost $8 billion in the first quarter, one quarter of this year, and an additional $10 billion from taxpayers, and warned that it will need more in the future. That comes on top of the $126 billion that Fannie Mae and Freddie Mac had already lost through the end of 2009. To make matters worse, this administration has taken off the $400 billion credit card limit on Fannie Mae and Freddie Mac, and it is our credit card they took the limit off. How much more does the administration think Freddie Mac and Fannie Mae can lose? How much more are they going to force not just us as taxpayers but our children and grandchildren to pay to bail out these toxic twins? Next, a great concern I have is that this bill lumps in the good guys with the bad guys and treats them all the same, particularly when it comes to derivatives. When it comes to derivatives, this bill lumps in those folks who try to manage risk and control costs by making long- term contracts with their suppliers or with their purchasers to even out the prices at which goods are exchanged. These are normal hedging contracts, and they are very different from the people who are speculating in the market to make a buck by shady bets with money they did not have or they were making insurance bets on property they did not own. I would urge my colleagues, if they have not read it, to read ``The Big Short'' which talks about how this whole scam unfolded with the bad underlying mortgages that caused the meltdown. I have heard some folks say, what actually does this bill mean to you and me? Well, it means, for instance, that utility companies may not be able to lock in steady rates for their customers, leaving them instead at the whim of the volatile market. They will have to clear all of their long-term contracts and pay billions of dollars to Wall Street or Chicago to clear the normal long-term contracts with energy suppliers whom they work with on a regular basis, and whose contracts never contributed a nickel to the volatility. As a matter of fact, by locking in prices, they were able to produce their energy at a reasonable rate. The billions of dollars these utility companies will be forced to cough up to Wall Street and Chicago will come down to each and every one of us on our utility bills. When the utility companies have to pay more, guess what. We, as ratepayers, get it in the wallet. That is where we will feel it, and that is what it means in every community in this country. You will be paying a higher cost every time you flip on the light switch, turn on the air conditioning, or use a computer. You will pay more for that energy. For family farms, the backbone, the agricultural backbone of our country, they will not be able to get long-term financing. That may force some of them to quit farming and prevent others from even getting started. Frankly, I am stunned that any Senator in good conscience would vote for a bill that would increase costs for every American, especially at a time when working families are struggling to make ends meet. What will this do to business? These businesses, who will be forced to pay higher energy costs, who will have requirements on derivatives that have to be cleared, may not create the jobs. The community bankers who make the loans that families need or that small businesses need may be so strapped they cannot make the loans. That credit will dry up. I cannot vote for a bill that creates a massive new superbureaucracy with unprecedented authority to impose government mandates and micromanage any entity that extends credit. We are not talking just about the Goldman Sachs and AIGs of the world, the ones at the center of this crisis. No, in the real world we are talking about this organization, this Consumer Finance Protection Board or Bureau, regulating the community banks, your car dealers, even your dentist or orthodontist who has to extend some credit to a few people for expensive orthodontic features. Don't be fooled. Any of the new costs as a result of the new mandates and regulations will be passed on to the consumers. The very people the bill was supposed to protect--you and I--will get to pay for it. Under this new superbureaucracy misnamed the Consumer Financial Protection Bureau, will safety and soundness requirements for healthy banks give way to a prevailing agenda of the new bureaucracy? There will be political appointees of the President who will be looking over everything as consumer protectors. Some of these consumer protectors were the ones who forced banks to make loans to people who could not afford them in the past. Will the safety and soundness which is key to assuring a sound banking system be overridden by these rules and regulations? These regulations can be enforced by every attorney general in the Nation. Attorneys general may decide it is an abusive practice if a community bank does not follow the mandates, the credit allocations, mandated to this CFPB. How would the community banks be able to operate if the attorneys general are suing them? This bill, regrettably, is much like the health care bill recently signed into law, because I fear that small businesses will soon learn that there are many more unintended consequences which have yet to be seen. I ask unanimous consent that at the end of my remarks, I have printed in the Record an article by Meredith Whitney that appeared in yesterday's Wall Street Journal, one of the people who foresaw this crisis coming, who warned of the impact on small business.

Mr. BOND. To sum up my view on this bill, if the goal here is to enact real reform that ensures we never have another financial crisis such as the one we had 18 months ago, this bill falls woefully short of the goal. The bill is light on reform of Wall Street and the bad actors, it is heavy on overreach and unintended consequences throughout our economy, which will affect the ability of people to get and hold jobs. It will affect the budgets of every family. My colleagues I hope will oppose cloture and continue to work to pass bipartisan amendments that will make changes to the destructive provisions I have outlined above. Let us not forget about the rating agencies. The book I mentioned, ``The Big Short,'' pointed out that the brain-dead analysts at the ratings firms routinely put AAA ratings on some of the most toxic, worthless paper, and then other people managed to buy insurance on those bad contracts even though they did not have any interest in them and made millions. This amendment takes out the rating agencies, but the rating agencies still need to be overlooked and they ought to be funded not by the people who issue the paper but by the people who are buying the paper. There is no doubt that everybody here knows we need to protect Americans from falling victim to another Wall Street gone wild. This is government gone wild. It benefits Wall Street. It harms small business, community bankers, your local utility company, which sends you your utility bill. Is that on the right track? I do not see how anybody can say it is. We do not want--and this is why this debate is so important--to punish the everyday Americans for a crisis they did not cause and whose impact they feel the burden, and our children will feel it, for years to come. Unless we succeed in it, the Democrats' bill will do just that. The cost will be paid by Main Street and by each and every one of us. Therefore, I urge my colleagues to oppose cloture and let us get to work on regulating what went bad and not messing with things that work. I yield the floor. Exhibit 1 [From the Wall Street Journal, May 17, 2010] The Small Business Credit Crunch (By Meredith Whitney) The next several weeks will be critically important for politicians, regulators and the larger U.S. economy. First, over the next week Capitol Hill will decide on potentially game-changing regulatory reform that could result in the unintended consequences of restricting credit and further damaging small businesses. Second, states will approach their June fiscal year-ends and, as a result of staggering budget gaps, soon announce austerity measures that by my estimates will cost between one million to two million jobs for state and local government workers over the next 12 months. Typically, government hiring provides a nice tailwind at this point in an economic recovery. Governments have employed this tool through most downturns since 1955, so much so that state and local government jobs have ballooned to 15% of total U.S. employment. However, over the next 12 months, disappearing state and local government jobs will prove to be a meaningful headwind to an already fragile economic recovery. This is simply how the math shakes out. Collectively, over 40 states face hundreds of billions of dollars in budget gaps over the next two years, and 49 states are constitutionally required to balance their accounts annually. States will raise taxes, but higher taxes alone will not be enough to make up for the vast shortfall in state budgets. Accordingly, 42 states and the District of Columbia have already articulated plans to cut government jobs. So the burden on the private sector to create jobs becomes that much more crucial. Just to maintain a steady level of unemployment, the private sector will have to create one million to two million jobs to offset government job losses. Herein lies the challenge: Small businesses, half of the private sector (and the most important part as far as jobs are concerned), have been heavily impacted by this credit crisis. Small businesses created 64% of new jobs over the past 15 years, but they have cut five million jobs since the onset of this credit crisis. Large businesses, by comparison, have shed three million jobs in the past two years. Small businesses continue to struggle to gain access to credit and cannot hire in this environment. Thus, the full weight of job creation falls upon large businesses. It would take large businesses rehiring 100% of the three million workers laid off over the past two years to make a substantial change in jobless numbers. Given the productivity gains enjoyed recently, it is improbable that anything near this will occur. Unless real focus is afforded to re-engaging small businesses in this country, we will have a tragic and dangerous unemployment level for an extended period of time. Small businesses fund themselves exactly the way consumers do, with credit cards and home equity lines. Over the past two years, more than $1.5 trillion in credit-card lines have been cut, and those cuts are increasing by the day. Due to dramatic declines in home values, home-equity lines as a funding option are effectively off the table. Proposed regulatory reform--specifically interest-rate caps and interchange fees--will merely exacerbate the cycle of credit contraction plaguing small businesses. If banks are not allowed to effectively price for risk, they will not take the risk. Right now we need banks, and particularly community banks, more than ever to step in and provide liquidity to small businesses. Interest-rate caps and interchange fees will more likely drive consumer credit out of the market and many community banks out of business. Clearly, the issue of recharging the securitization market as an alternative source of liquidity is one that needs to be addressed over time, but politicians should not force rash regulatory reforms when significant portions of our economy remain fragile. The very actions designed to ``protect'' the consumer, such as rate caps and interchange fees, will undoubtedly take more credit away from the consumer. It is important now to support any and all lending activities that would enable small businesses to begin hiring again. If the regulatory reform passes with rate-cap and interchange regulation amendments incorporated, small businesses will be hurt rather than helped. Politicians and regulators need to appreciate the core structural challenges facing unemployment in the U.S. Elected officials know better than most that an employed voter is better than an unemployed voter. They should improve their odds of re-election and do the right thing on regulatory reform.

Mr. BOND

Mr. BOND. Mr. President, I rise to speak on the Gregg amendment and ask unanimous consent to be included as an original cosponsor.

Mr. BOND. It is important we recognize what a fiscal crisis we face in the United States. Today, America's public debt stands at over $12.9 trillion. Regrettably, that will be on our children's and grandchildren's credit cards. We have, just last year, raised that debt by $1.4 trillion, and it will be $1.6 trillion added this year. This mountain of debt is going on the backs of our children and grandchildren. We will have to pay the interest on it, but they are the ones who will bear the real burden. Taxpayers are already bailing out Wall Street and failed banks with $700 billion; GM and Chrysler, $80 billion; the toxic twins, Fannie Mae and Freddie Mac, more than $1.2 trillion. We have tried unsuccessfully to deal with Fannie and Freddie in this financial regulation bill. When we look at the cause of the financial crisis, it is the subprime market, the bad home loans that were enabled by Fannie and Freddie being willing to purchase them. In my humble estimation, we should not pass a financial regulation bill designed to prevent a reoccurrence of the crisis which we have just gone through without dealing with Fannie and Freddie. But when you look at the budget deficit, taxpayers are on the hook for $1 trillion in a failed stimulus package which only created jobs in the governments. It was a government expansion, not a measure to create jobs in the private sector. The President and majorities in Congress have also recently created a new taxpayer-funded entitlement for health insurance. Many of us in December were pointing out the fact that this bill would add to the debt, it would drive up costs of private health insurance, it would limit the ability of seniors on Medicare to get their services by cutting the amount of money going into Medicare, and it would lead to higher taxes. Funny thing, the new Actuary at the CMS has just come out and repeated those same four things. The health care bill is not only going to drive up private insurance costs, you are not going to be able to keep the same plan you had, it will continue to squeeze down the services Medicare recipients can receive, and it will add to the deficit and, thus, the debt. But how much more debt and how many more unfunded liabilities can we take on before destroying the economy? What is happening in Greece, regrettably, could happen here. I strongly support the Gregg amendment, which will ensure that taxpayer funds are not used to bail out States. We talked about too big to fail in terms of financial institutions. We ought to be talking about it in terms of governments. We adopted an amendment saying we should not use taxpayer money to bail out Greece. But we should not be in the position where we would be called upon to bail out States which have been unable to get their spending under control and get their spending in line with their revenues. I know a little bit about tight State budgets. When I was Governor of Missouri, we had to make tough decisions. I came back into office as Governor in 1981, with a huge deficit in the middle of the year, and we could not borrow money to cover that deficit. So we made major, drastic cuts in spending, and it was not pleasant. I was picketed by people who had to be laid off from the State government. But we readjusted and managed to provide services our State needed and put the State back on a sound financial footing. States all across the country are taking tough steps. There are areas where they have agreed to go without services to get their budget back in balance. Most States do not have the ability to run deficits. Those that do have the ability to do that should not be operating on the false assumption that the Federal taxpayers and our children and our grandchildren will come back in and be asked to take the irresponsible and unacceptable task of putting a burden on residents of the States that have made the tough decisions and cut spending to pay for the mounting debt of other States that have spent their way into the red for years. In fact, a bailout of States would create a disincentive, an ongoing disincentive, for State leaders to make tough decisions and implement necessary reforms to get their budgets in balance and future liabilities under control. The Missourians I hear from are very angry. They are angry every day at spending money on things that are too big to fail. They are angry that the government continues to use their hard-earned dollars to help companies such as AIG and potentially to help a country such as Greece, which failed, instead of paying down our debt and cutting the runaway spending. This bailout mentality must end. I thought that was one message we were going to carry with this legislation. I hope this legislation actually does, although I am concerned there are provisions that could enable the Federal Government to continue bailing out and taking over more businesses. The Federal Government must not continue to be an enabler of those companies or those countries or States that continue to spend beyond their means. It is time for the leadership at the State, as well as the national level, to make the decisions necessary to put all of us on a sound financial footing. I thank Senator Gregg for his strong leadership on budget issues and for offering this amendment, and I urge my colleagues to support his amendment.

Mr. BOND. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. BOND. Mr. President, I ask unanimous consent to speak for 2 minutes remaining on Senator Gregg's time.

Mr. BOND. Mr. President, the argument has been made that this bill would somehow limit responses to natural or manmade disasters, a natural disaster such as a flood or a tornado, a manmade disaster such as what is occurring in the gulf. I have read this language. It is very clear. It is talking about defaulting on obligations. It in no way restricts the ability of the Federal Government to respond to disasters. I used to chair the subcommittee on the Federal Emergency Management Act, and when there was a disaster, we provided money for those disasters, to deal with those disasters. But one cannot continue to present unbalanced budgets and enact them into law and continue to drive up the debt and say it is because of a natural or manmade disaster. That is a stupid decision. I don't think the taxpayers of the United States should be in a position of bailing out governments that make bad decisions and that, year after year after year, spend more money than they are taking in on their ongoing obligations. It has nothing to do with a sudden natural disaster or even a manmade disaster such as the spill in the gulf, which is partly natural and partly manmade. I agree that we should not stop providing assistance where there is such a disaster, but that is not the focus of this amendment. I urge my colleagues who really believe we should not be promising to bail out profligate States that continue to spend more than they take in, we should not bail them out with taxpayer funds. I yield the floor.

Mr. BOND

Mr. BOND. Mr. President, I am pleased to rise today to discuss a bipartisan amendment critical to small business and job creation, amendment No. 4056. Thank you to my friend and colleague Senator Dodd for his leadership on this amendment. I am proud to cosponsor this amendment with Senators Dodd, Mark Warner, Scott Brown, Cantwell, Begich, and Murray. Senators on both sides of the aisle agree that Wall Street needs to be reformed to protect Main Street from a future crisis. Senators on both sides of the aisle can also agree that small business job creation is critical to our economic recovery and communities in my State of Missouri and across the Nation. That is what this bipartisan amendment is all about--protecting the small business startups that are so vital to job creation and economic development. Specifically, our amendment removes onerous regulations and restrictions in the financial reform bill that would have unintentionally stifled job creation. The provision would have unintentionally threatened small business startups by delaying and limiting the availability of essential seed capital from qualified investors. Our country's entrepreneurs need immediate access to capital as they work to move an idea from concept to production--especially when banks or traditional lenders may not be willing to extend large lines of credit to them. We want to encourage--not discourage--investors to take a chance on these entrepreneurs by providing seed capital to startups in hopes that the business will flourish and remain a viable company. Our amendment allows this investment and job creation to continue. With our amendment agriculture research and biotechnology startup companies like those in my State of Missouri, will continue to be the engine of job creation. We all agree that we must reform Wall Street, but we must not punish Main Street and the very small business startups that are so critical to job creation. This bipartisan amendment will help protect the small business startups vital to job creation across the country, and I urge my colleagues to support it.

Mr. BOND

Mr. BOND. Mr. President, Americans have sent Congress a message: Reform Wall Street, hold the bad actors accountable, but do not hurt the folks on Main Street who had nothing to do with the financial crisis. That is what we are debating about here in the Senate this week. Senators on both sides of the aisle agree on one thing: All of us want to hold Wall Street accountable for the havoc wreaked on Main Street. We all agree we need to enact reform to prevent another financial crisis. But we have some disagreements on what responsible reform looks like. While we all agree on the need to reform Wall Street to protect Main Street, the current bill, even with amendments so far, does not, in my view, do the trick. We are making progress, but there is still a lot of work to do because, in its current form, the bill is still a massive government overreach, punishing Main Street, hurting families, and costing jobs by stifling small business and entrepreneurs. Today, I will highlight some of the concerns I have heard from Main Streets in Missouri and elsewhere and some of the amendments that have been filed to improve the bill. First, on the GSEs, none of us can deny that Fannie Mae and Freddie Mac were significant contributors to the financial crisis. Just like any real reform, to prevent a future financial crisis, we have to deal with Wall Street, and we must also deal with Fannie Mae and Freddie Mac. Unfortunately, this bill totally ignores it. It turns a blind eye to these government-sponsored enterprises, these GSEs which contributed to the financial meltdown by buying high-risk loans banks were directed to make to people who could not afford them. The irresponsible actions in the marketplace by Fannie and Freddie turned the American dream into the American nightmare for far too many families who faced foreclosure. They then devastated entire neighborhoods with the foreclosed homes and communities where property values diminished. Ultimately, it led to a national and international financial crisis. No one--especially those of us who are taxpayers--can forget what happened after Fannie and Freddie got done wreaking havoc on families and neighborhoods. They went belly up. That is right. Over a year and a half ago, the government had to take over the GSEs, leaving taxpayers to foot the bill. To make matters worse, I am sure everybody read with shock just yesterday when the press reported that Freddie lost $8 billion in the first quarter. That is a lot of work. Then they had the nerve to request another $10.6 billion from the American taxpayers and warned that this $10.6 billion is just a downpayment on the money they will need in the future. Is it time to call a halt? Is it time to get a handle on it? It is well past time. In case my colleagues need a reminder, this latest $8 billion Freddie lost is on top of the $126.9 billion Fannie and Freddie had already lost through the end of 2009. The Wall Street Journal today hit the nail on the head when they referred to Fannie and Freddie as the ``toxic twins.'' These toxic twins are far and away the biggest losers in the entire financial crisis--bigger than AIG, Citigroup, and all the rest. So when we focus our anger, let's not forget our friends at Fannie and Freddie. You talk about doing some damage. Here is where the damage is. Here is where the burden comes, not just on us but on the credit cards of our children and grandchildren, the young people here as pages. They don't realize how heavy a debt burden we have already put in their wallets. Sorry about that, folks, but you and your generation and generations to come are going to be paying for it. Taxpayers now and taxpayers in the future will be the biggest losers, since according to the Congressional Budget Office's optimistic estimates, these toxic twins will cost the taxpayers close to $380 billion. Even for those of us in Washington, $380 billion is a big number. After all this pain to families, neighborhoods, and taxpayers, one would think the oversight of Fannie and Freddie would be a top priority, which is why it is stunning to me that the Obama administration has only recently nominated someone to fill the critically important position of inspector general of the Federal Housing Finance Agency to oversee the GSEs. How can we have proper and effective oversight of Fannie and Freddie when the office has been vacant at the highest level for so long? The bottom line is, responsible reform must address Fannie Mae and Freddie Mac. Responsible reform would put an end to the taxpayer-funded bailout of Fannie and Freddie and refocus them on affordable housing. Senators McCain, Shelby, and Gregg have filed an amendment to protect taxpayers and put an end to the government bailout of Fannie and Freddie. In short, this amendment cuts up the Federal credit card by putting an end to the limitless line of credit Fannie and Freddie currently enjoy, compliments of us as taxpayers. This amendment puts an end to the conservatorship and requires each to operate eventually without government subsidies and on a level playing field with the private sector. Next of great importance is seed capital. It is critical in reforming Wall Street that we not punish Main Street and the very specific small business startups that are so critical to job creation. If there is one thing we are worrying about it is, Where are the jobs? Well, I will tell my colleagues where the jobs are. They are the jobs the entrepreneurs and the innovators and the inventors can start. Unfortunately, in the current form of this bill, there are provisions that will kill the business startups. While title IX of the Dodd bill has been little talked about--far too little, in my opinion--it could have devastating consequences. Specifically, this provision would kill small business startups by delaying and eliminating the availability of private investor seed capital, and that is essential for these startups to survive and grow. According to new regulations by the SEC, innovators and entrepreneurs would be subject to registering with the SEC for a 4-month review; thus, tying up vital venture capital needed for immediate use by new business. This could cripple new businesses. Next, the bill proposes to add a further requirement to raise the net worth threshold on those who can invest to $2.3 million and raise the annual household income to $450,000. This would disqualify two-thirds of current accredited investors, according to the Angel Capital Association. Small businesses and startup companies are the backbone of our country. They are where we are looking to get the new jobs of the future, and a critical role is played by angel investors in creating and developing new companies, small or large. I will confess, this is of particular concern to my State of Missouri, where I have been working for a long time to build an agricultural biotech corridor across the State. In Missouri, we have the research institutions, the scientific leaders, and advanced agricultural research and biotechnology. Research in the biotech industry is our best hope for a stimulus to create high-paying, skilled jobs in rural as well as urban Missouri and, I would say, across America. The stimulus these biotech and research companies are spurring in Missouri is also happening today across the Nation. According to the Kauffman Foundation, between 1980 and 2005, companies less than 5 years old accounted for all--all--the net job growth in the United States. As a matter of fact, that same study showed that in 2008, angel investors provided roughly $19 billion to help start up more than 55,000 companies. Why would we want to limit that? The bill, if enacted, would deny immediate access to the capital and, if enacted, would say to these innovators and entrepreneurs: You are too small to succeed, too small to survive--not too big to fail. But there is good news here, and there is a bipartisan solution in the works. I am very thankful and grateful to Senator Dodd, who has agreed to work with me to fix the problem. We both want to protect these small business startups that are vital to job creation across the country. I think we are close to an agreement to fix this, and we hope to have a bipartisan amendment soon. I urge all my colleagues to take a look at it and to join us in supporting it. Next and finally for today, one of the biggest problems in the bill-- which I believe will undoubtedly hurt ordinary Americans who had no role in causing the financial crisis--is the creation of the so-called Consumer Financial Protection Bureau, CFPB. Those initials could, in the future, scare people more than all the combined deadly 10 acronyms, including the IRS, EPA, and SEC. This new massive supergovernment bureaucracy would have unprecedented authority to impose expensive mandates on any entities that extend credit. We are not talking about Goldman Sachs or big Wall Street banks. Instead, this new superbureaucracy could hit hard the community banker, farm lender, local dentist or auto dealer. The pain on Main Street will not just be borne by small business, but the costs will be passed on to consumers, the ordinary Americans the bill seeks to protect. It might even cost them their jobs. The National Federation of Independent Business, a strong voice for small business, stated their concern clearly when they said: These small businesses had nothing to do with the Wall Street meltdown and should not be faced with onerous, new, and duplicative regulations because of a problem they did not cause. Further, as the most recent NFIB Small Business Economic Trends survey shows, small businesses continue to struggle with lost sales, and such regulations could make these problems worse, stifling any potential small business recovery. That is why I have joined with Senators McConnell, Shelby, Gregg, and others on an amendment to fix the problem. Instead of creating a brandnew superbureaucracy with unlimited authority and reach, our amendment would empower the FDIC to look out for consumers. This makes sense. The FDIC is the one that has a strong record of providing consumer protections. It has a record of being able to deal with financial institutions. It deals with the financial institutions that get into problems. It is in the banks. Any institution that is regulated by the FDIC, they are in there looking over their shoulder. Our amendment would create a division of consumer financial protection within the FDIC so they can protect consumers without adding burdensome and duplicative regulations. It would avoid costs being passed on to consumers, the very folks we are trying to protect, not saddle them with new costs. The amendment will ensure that the consumer protection division focuses on the real problems currently operating under the radar--the shadow banking I call it--or, as I like to say, the clicks, not the bricks. These are the people who have preyed on vulnerable Americans. Before the financial crisis that was brought on by bad loans, especially too-good-to-be-true home loans pushed on families who could not afford the loans, my fax and inbox were cluttered, despite my best spam filters, with 1 percent or no down payment loan offers. These offers were not regulated effectively by State regulators, the SEC, the Federal Reserve or the OCC. They succeeded in escaping effective regulation entirely, although some have later fallen to regulation by U.S. attorneys who filed criminal fraud suits a little bit too late in the game. Also, it is important this new division be tasked with providing financial literacy, as I will continue to stress. We have to improve consumer education in any and all areas where loans are made. While foreclosure counseling is important--another bipartisan program on which I worked with Senator Dodd in December of 2007 and in which we put $180 million to reach out to financial counseling groups. They are doing a good job trying to help counsel families in danger of losing their home and ways to solve the problem. Those counselors came back to us unanimously and pleaded with us to make available preloan counseling before somebody buys a home, to make sure they understand the terms and can afford to service the loans. These are just some of the things we need to do. Missourians and people across America are angry. They are angry bad actors caused the financial crisis that left many of them with a pink slip instead of a paycheck. They are angry Wall Street bad actors left them with a nightmare of foreclosure instead of the American dream of home ownership. They are angry government has committed trillions of taxpayer dollars for rescuing the financial industry when so many of them are still struggling to pay bills. Is it any surprise that Missourians and Americans across the country are skeptical about financial reform? These folks were made more skeptical when they heard and saw on TV and read in the paper that it is the actors on Wall Street, with whom the bill was supposed to deal and who caused the financial crisis, who are now cheerleading this bill. Missourians ask me how this bill can be real reform when the head of the investment bank Goldman Sachs, who is supporting the bill, said--let me make sure you understand. This is from the head of the largest investment bank on Wall Street: ``The biggest beneficiary of reform is Wall Street itself.'' That is a quote about the original bill. Missourians have asked me not to pass a bill that will bail out Wall Street. We need to take care of Main Street. There is no bailout for struggling families. We don't want anymore Wall Street bailouts. We need to pass a bill that reforms Wall Street and protects Main Street. I believe we have an opportunity to pass real, responsible, and bipartisan reform, if Senators of both parties will listen to the concerns raised by ordinary Americans who didn't cause but are paying for the financial crisis. I have heard similar concerns discussed by speakers on the other side of the aisle who seem to indicate we share the same concerns. I hope we can work together to get a good, strong reform bill that will deal with the problems that caused the last financial crisis, protect consumers, and ensure the safety and soundness of all financial institutions and not subject them to special interests who may have pushed for the bad loans that caused the last crisis. I thank the Chair, yield the floor, and suggest the absence of a quorum.

Mr. BOND

Mr. BOND. Mr. President, I am delighted to join in this debate, and I invite my friends on the other side to listen to what the people in communities in our home States are saying, who don't spend time soliciting funds on Wall Street. Let's be very clear: We all agree we need to hold Wall Street accountable for the havoc wreaked on Main Street. We all agree we need to enact reform to prevent another financial crisis. Where we disagree on is what the responsible reform looks like. I have real concerns that, in its current form, the Democrats' bill, written with the White House, is a massive government overreach that will punish Main Street, hurt families, and cost jobs by stifling small businesses and entrepreneurs. To sum it up, Democrats want to treat Main Street, our community banks, our farm lenders, and our auto dealers like they were Goldman Sachs or others on Wall Street. We Republicans want to ensure we fix Wall Street, without crippling Main Street. The only way to do that is to force the Democrats to listen to the concerns of Main Street, to open this up and make it a bipartisan process. It has not been, and it isn't going to be until we get some discussion and real substantive changes in what I view as a very dangerous bill to the economic climate and health of our country, our States, our communities, and the creation of jobs. Today, let me share with you some of the concerns I have heard from Main Street. Like families in every community and every State, small businesses were the victims. They weren't the perpetrators of the financial crisis caused, among other places, on Wall Street. Small businesses were not responsible for the financial crisis and should not be treated as if they were. But that is exactly what this bill does. This 1,400-page bill reaches far beyond Wall Street and will impose new costs and onerous new regulations on small businesses to fix a problem they were not responsible for causing. In short, this bill would change the way every American does business. We are not just talking about changing the way Wall Street banks do business, but also how every community banker, local dentist, farm lender, and auto dealer does business. I urge my colleagues to take time away from the floor and listen to the people at home. They have a very different message than that which we are hearing from our friends on the other side of the aisle. These concerns are not just Republican concerns. I hope my colleagues on the other side of the aisle are also hearing from their constituents back home about disturbing provisions in the Democrats' proposal and have begun to agree with Senate Republicans that there is a lot of work to be done before we bring this 1,400-page monstrosity to the floor. Don't misunderstand me. Like the nearly two-thirds of all Americans who favor some sort of reform of Wall Street, so do I and my Republican colleagues. But we need responsible and bipartisan reform that all Americans and businesses can be proud of. I want to work with my friends on the other side to ensure that the concerns I have heard from Missourians--1,000 miles away from Wall Street--are addressed as the process moves forward. First, I continue to be stumped that any real form of our financial system could ignore Fannie Mae and Freddie Mac, which were significant--if not the majority--contributors to the financial crisis. But that is what this bill does. That is a mistake, and so is leaving out the rating agencies who gave triple-A ratings to bad paper that was foisted on the system. Fannie Mae and Freddie Mac--these government-sponsored GSEs-- contributed to the financial meltdown by buying high-risk loans made to people who could not afford them. In addition to the cost to taxpayers, these irresponsible actions turned the American dream into the American nightmare for too many families who faced foreclosure, lost their homes, which devastated entire neighborhoods and communities as the property values diminished, as well as the credit rating of the families displaced. Responsible reform must address the GSEs. Responsible reform would put an end to the taxpayer-funded bailout of Fannie and Freddie and refocus them on promoting affordable housing. Next, it is critical that in reforming Wall Street, we are not punishing Main Street. Instead, we should be protecting small business startups that are so critical to job creation. Unfortunately, this bill will kill small business startups. While title IX of the Dodd bill has been little noticed, it would have devastating consequences. Specifically, this provision would kill small business startups by delaying and limiting the availability of private investor seed capital, which is essential for the survival and growth of these startups. Through new, burdensome regulation by the SEC, innovators and entrepreneurs would be subject to registering with the Commission for a 4-month review before they could get out and start soliciting money. This tying up of vital venture capital dollars needed for immediate use by small businesses would cripple their startup efforts. This is not a measure that will protect people from Wall Street. This is not a measure needed because venture capitalists and small startup entrepreneurs and innovators were causing the crisis. No, they are part of the solution of the jobless problems we have now. This provision is an overreach by the Federal Government, which would shut down the job creation that Main Street provides, which this country desperately needs. Raising the net worth threshold for those who can invest in these venture capital firms to $2.3 million from the existing $1 million, and raising the annual household income threshold to $450,000, as the Dodd bill proposes to do, would disqualify two- thirds of the current accredited investors, according to the Wall Street Journal, who otherwise would help fund small startups in our communities. These are the people whom these innovators and entrepreneurs have to go to, and this will make it impossible for them to get the money they need. Therefore, some woman, some man with a great idea is much less likely in your hometown to be able to get the funds she or he needs to start a business. I believe strongly--and I have always said and will continue to say-- that small businesses and the startup companies are the backbone of our country. I understand the critical role these so-called angel investors can play in the creation and development of new companies, small or large. Let me tell you about my position. Right now, in Missouri, I have been working to help build an agri-biotech corridor across the State. In Missouri, we have the potential to foster a whole new industry in advanced agricultural research and biotechnology. This agriculture research and biotech industry is our best opportunity to stimulate and create high-paying skilled jobs in rural Missouri, rural America, and in the cities as well. The stimulus these biotech companies are spurring in Missouri is also happening in other States across the Nation. According to the Kauffman Foundation, located in Kansas City, between 1980 and 2005, companies less than 5 years old accounted for all--all--net job growth in the United States. As a matter of fact, the same study showed that in 2008, angel investors provided roughly $19 billion in more than 55,000 companies. You are going to put an end to that with this bill? Let us go back and think about it before we bring this monstrosity to the floor. The new bill, if enacted, would deny immediate access to capital. If enacted, it would say to innovators and entrepreneurs: You are too small to succeed, too small to survive. That is far different from what this bill was promised and promoted as doing--stopping too big to fail. Yes, I am going to see in my communities and you are going to see in your communities too small to survive. That is not where we should be going. Killing small business startups and jobs on Main Street is not the only unintended consequence of the Democrats' current proposal that has come to light. Caught up in the Democrats' fervor to pass a bill--any bill--without careful consideration, are members of the U.S. military and their families. Last week, I heard from active-duty and retired military members who fear this bill would hurt their financial security. You see, under the Democrats' bill, United Services Automobile Association--USAA, a financial and insurance provider for members of the U.S. military and their families--would, after an 87- year track record, no longer be able to manage their own portfolio. Also as a result of the Dodd bill, this company that serves our military and veterans would have their ability to offer certain competitive products to servicemembers and their families jeopardized and their ability to return money to servicemembers and their families limited by this massive expansion of government authority. This must be fixed. I would urge my colleagues to listen to the military and veterans and their families in your States. See what they think. Unfortunately, the unintended consequences of this bill keep piling up. The next major concern I have heard from Missouri community banks that provide critical lending to families and small businesses is the creation of the so-called Consumer Financial Protection Bureau--CFPB. This massive new government bureaucracy has unprecedented authority and enforcement powers to impose mandates on any entities that extend credit. We are not just talking about big Wall Street banks here but also your community banker, your local dentist. Dentists are telling me that if they offer credit, they would be regulated. Farm lenders would find it very difficult for them to be able to operate to make their farm loans and to be able to hedge the risk that they normally do. Auto dealers can sell cars only through the benefit of private sector financing. As a result, there will be no choice but to pass the costs on for this financing, if they can get it, to the consumers--the very people this bill is supposed to protect. And it may cut some of them out of getting credit altogether. The National Federation of Independent Businesses, a strong voice for small businesses, voiced their serious concern over the creation of this new bureaucracy. I am sure you all have received it, but if you have not, I would urge you to check your mail, because the letter from the NFIB to Congress says: These small businesses had nothing to do with the Wall Street meltdown and should not be faced with onerous new and duplicative regulations because of a problem they did not cause. Further, as the most recent NFIB Small Business Economic Trends survey shows, small businesses continue to struggle with lost sales, and such regulations could make these problems worse--stifling any small business recovery. In other words, they are saying: We do this and small businesses are going to be even less likely to be able to create jobs. We have already put too much debt on the Federal books. We are threatening to increase their taxes by a tremendous amount, and now we see regulations that are going to interfere with their normal credit operations. That is a cause for concern. This very high unemployment the stimulus bill didn't touch, other than getting more people working for the Federal Government. It was supposed to bring our unemployment rate down to 8 percent, but it is going to continue to fail and fail miserably if we stifle the ability of small businesses to create jobs. The only way to ensure that the CFPB does not unintentionally hurt Main Street but still protects consumers is to narrow the scope and authority with clear language outlining exactly who this new regulator will regulate and what it will do. Instead of unlimited authority, this new regulator should focus on the shadow banking entities operating outside of the regulatory framework and preying on vulnerable people. The banks and the savings and loans that issue loans are regulated by government regulators. Are the people who are making these large loans, such as home loans, regulated? In a lot of areas they are not. CFPB could look at those. I proposed 2 years ago a mortgage origination commission to make sure everybody originating mortgages was regulated by some appropriate State agency. Well, we haven't done it. We also need to ensure that we are not empowering, through this new government agency regulator, the same organizations which pushed home ownership at any cost onto families who could not afford to repay their loans. This is one of the key problems we had. People who couldn't afford homes were told that they could get them with no downpayment, even if they had bad credit. If they didn't have the money to have a home, they were told they could have a home anyhow. These are the people who saw their American dream turn into the American nightmare. These are the people whose houses were foreclosed, their families thrown out, their communities devastated, and ultimately the entire network of not only America's financial system but the world's financial system brought down by this bad paper. Surely, my colleagues would not want to vote for a bill that creates a new government bureaucracy without knowing exactly what the bureaucracy is empowered to do and if it will take on the real bad actors who got us into this mess. This CFPB is a perfect example of how the ``one size fits all'' of this hurried legislation will have unintended consequences for those who did not contribute to the financial meltdown. Treating community banks like Goldman Sachs is a mistake, and one we cannot afford to make. If we are aware of these unintended consequences now, why won't we correct them now? Why do my colleagues want to bring these unintended consequences in the bill closer to being codified into law on the Senate floor? If you want to have some real consumer protection, I purchased several homes, as we have moved around recently, and I can tell you that the best thing we can do for consumer protection is to repeal all the laws that require a stack of paper that high that you are supposed to sign saying you have read it. Have consumer protection with a very simple one- or two-page form. I have talked about that before. That is simple consumer protection. Let people know, for people who are not adequately informed on financial situations. The one thing we found out when I joined with the chairman of the Banking Committee, Senator Dodd, in pushing home foreclosure counseling, as we worked with agencies that were counseling people who were losing their homes through foreclosure, is these agencies were crying out and saying: We need financial counseling for these people before they get into homes. That is the best way to avoid foreclosure. Let us go back to that. It sounds simple, but it happens to be the thing that would work. I doubt my Democratic colleagues intend to pass a bill that will hurt families every time they turn on the light switch or try to heat their home, but that is what this bill in its current form will do, once again, trying to go for the easy one-size-fits-all approach to entities that it does not fit in any way. The $592 trillion over-the-counter derivatives market needs stronger rules of transparency on the things that are run through Wall Street. Some of these derivatives traded in this market played a significant role in the recent crisis, through products such as credit default swaps. I have called these derivatives computer game derivatives. They were so complex. They were something somebody thought up and ran through a computer. You know what. Our regulators fell down on the job. They didn't look at these derivatives. They were not transparent. They were not regulated. Some of that is the fault of the regulators, who are now scrambling to come in and file suits. They are supposed to regulate and make sure that these products that are complicated are fully transparent and related to reality and go to those who are at least sophisticated. You can't guarantee that they win or lose, but at least know what they are; make sure they are clearly understood by everybody; get the rating agencies to judge them independently, not as captured entities for the people who issue them and will pay the rating agency if they get the rating they want. But there is an important distinction between the computer game derivatives or the very sophisticated derivatives that are traded on Wall Street. You can make good financial arguments for them, so long as they are traded on an exchange--the Wall Street derivatives, so long as somebody is looking at them to make sure there is some integrity in them. But not all derivative contracts pose systemic risk. As a matter of fact, commercial contracts initiated by energy companies, utilities, and the agricultural industry are used to manage risks associated with their daily commercial operation, from cost fluctuations in materials and commodities to foreign currencies used in international business. These end users, these commodity hedgers, make up less than 3 percent of the market. I don't know of any farmer or any farm agency or any utility who caused the crisis on Wall Street by entering into a long-term supply- and-purchase contract. There is no reason to make this be traded on an exchange when you have an ongoing partner; no reason to acquire collateral to be posted. The end users, as they are called, do so in order to plan for future pricing so they can provide the least expensive goods or services to the consumer as possible. Costly margin requirements for the end users will be directly passed on to their families. Guess who pays for that? That is us. That is us. Because all Americans will see their costs go up whenever they turn on their lights, put food on their table, and use any form of transportation-- whether it be cars, trucks, buses, or airplanes. This is a problem that must be fixed. For the purpose of my time on the floor, I won't go into each and every problem I have heard about in the bill. I have only been given minutes to speak rather than hours. But the current concerns I have outlined are critical. The unintended consequences on which I have shined a light must be stopped. Americans do not want another massive flawed bill that will kill more jobs, make it harder to get a home or car loan, or make it more expensive to heat their homes. Yes, Americans are rightfully angry and frustrated about the bad actors on Wall Street who caused the financial crisis, costing many Americans their jobs and even their homes. Americans are rightfully angry and frustrated about the trillions of dollars the government has committed to rescuing the financial industry when so many of them are still struggling to pay their bills. These are the people from whom I am hearing. I agree with the majority of Americans who believe it is unfair for bad actors who caused this financial crisis to get bailed out with their tax dollars--with our tax dollars--when there is no bailout for families who lost their savings or jobs. I agree with the majority of Americans who are rightly skeptical of the Democrats' bill and the rush the majority wants to pass it in. It is no surprise that my constituents are skeptical. After all, it is the few bad actors on Wall Street who caused the financial crisis who are now cheerleading this so-called reform bill. I was stunned when I read that the head of the investment bank Goldman Sachs, Mr. Blankfein, said, ``The biggest beneficiary of reform is Wall Street itself.'' The head of Goldman Sachs said that the biggest beneficiary of this reform bill is Wall Street. Did you hear that, everybody who has been looking at Goldman Sachs? I also understand that Citigroup now supports this measure. They are huge Wall Street players who have had access to the White House and the majority leaders of both Houses to push for all the good things this bill does for them. They are the ones who have been in there. They are the major contributors. Look where the money goes. If you want to say: OK, who is looking for contributions, look at that and see what is in the bill. This bill clobbers Main Street and it glances off of Wall Street. Instead of helping Wall Street, I want to ensure a bill is passed that will protect Main Street. While Wall Street may be cheering this bill, I am here to ensure this bill represents Main Street concerns. What I am hearing from Main Street, they are concerned, and it doesn't address their concerns, it puts more burdens on them. I urge you, I ask you to listen to the folks at home. We need to hold Wall Street accountable for the havoc wreaked on Main Street and enact reform to prevent another financial crisis. This bill is too large, too costly for consumers, and will kill job creation at a time when working Americans need to be left to do what they do best; that is, succeed. My friends on the other side of the aisle can hold vote after vote, but until this bill fixes the problems and I can be sure it is not just Goldman Sachs, Citigroup, and the rest of Wall Street that will benefit, I will continue to force Democrats to listen to the concerns of Main Street America. I urge my colleagues to turn up the hearing and turn down the volume and listen to what the people in your States are saying. I yield the floor and suggest the absence of a quorum.

Mr. BOND

Mr. BOND. Madam President, I believe the Senator from Vermont has a brief statement.

Mr. BOND

Mr. BOND. Madam President, after the actions of some bad apples on Wall Street wreaked havoc on Main Street, America, there is no doubt we need financial reform to prevent another credit crisis. It is disappointing that bipartisan consensus on a financial reform package was not reached in committee and instead the majority chose a go-it-alone approach. I hope this is a process Democrats truly want to be bipartisan because my constituents have some good ideas about how to enact real reform that will not stifle economic growth and activities. I have told my good friend Senator Dodd and others that I want to work with them to ensure the concerns I have heard from Missourians--a thousand miles away from Wall Street--are addressed as the process moves forward. I have heard from Missourians who want to end too big to fail, and I have heard from Missourians who want to stop taxpayer- funded bailouts and Missourians who are fearful of empowering government bureaucrats with the power to pick winners and losers. I have also heard from folks in Missouri who are key to job creation. They have well-founded concerns about some of the bill's unintended consequences. This is a bill that could alter significantly the way Americans do business with the financial services industry, whether it be in the form of a home or auto loan, financing for college, credit for family farms, or much needed financing for small business. In the heartland, where I am from, we understand Wall Street provides critical financing, but we want to make sure they do it the right way. A bipartisan and responsible bill should ensure that the failures that led to our financial collapse are properly addressed and that taxpayers never again are left footing the bill for the egregious mistakes of a few bad actors. It is time to stop taking a piecemeal and ad hoc approach to addressing the financial crisis. Burying our collective heads in the sand to avoid what needs to be done and simply hoping things will get better by throwing more money at these failed institutions and just believing they will get better on their own is unrealistic. Americans are rightfully angry and frustrated about the trillions of dollars the government has committed to rescuing the financial industry, when so many of them are still struggling to find jobs, pay bills, and get the loans they need for cars, home, college, or to farm. They believe--and rightly so--that it is fundamentally unfair for the bad actors who caused the financial crisis to get bailed out while many of them lost their jobs and their savings as a direct result of the irresponsibility of others. We need a clear path to unwinding and ending these institutions that are too large and that pose systemic risk to the financial health of our market without doing so at the expense of the American taxpayer. No institution should ever again be considered too big to fail. Today, I remind my colleagues that the government played a role in contributing to our financial and economic crisis. Government policies and actions to promote home ownership to buyers who could not afford to buy were irresponsible. That is why I am shocked that this bill does nothing to reform Fannie Mae and Freddie Mac, the government-sponsored enterprises that contributed to the financial meltdown by buying high- risk loans made to people who could not afford them. These irresponsible actions left the Federal Government with the risk and the American taxpayer with the bill to bail them out. In addition to the cost to taxpayers, these irresponsible actions turned the American dream into the American nightmare for too many families who faced foreclosure and devastated entire neighborhoods and communities as property values diminished. Additionally, government failure to adequately regulate the financial system--specifically, the Securities and Exchange Commission and other regulators--allowed these institutions to take on too much risk, which was a major factor in the credit collapse. Collectively, these policies and actions have brought us to the economic crisis which has touched every American's life. The current proposal ignores Fannie and Freddie, which were significant contributors to the crisis. That is a big mistake. We need to be sure the proposals address the needs of Main Street America. Leaving them out would be another mistake. Rather than focusing on the concerns of Wall Street, I have spent my time focusing on the concerns shared with me by my constituents back in Missouri. Missourians expect real reform but demand that Congress prevent an overreach of government that stifles businesses and kills jobs. One specific area of concern is the creation of the so-called Consumer Financial Protection Bureau, the CFPB. This new, massive government bureaucracy has unprecedented authority and enforcement powers to impose duplicative and costly mandates on any entities that extend credit. We are not talking about just big Wall Street banks but also the community banker, the local dentist, farm lender, or auto dealer. As a result, there will be no choice but to pass these added costs on to consumers--the very people this bill was designed to protect. The only way to ensure the CFPB does not unintentionally hurt well- performing institutions that issue credit is to narrow the scope and authority with clear language outlining exactly whom this new regulator will regulate. Surely my colleagues would not want to vote for a bill that creates a new government bureaucracy without knowing exactly what the bureaucracy is empowered to do. Instead of unlimited authority, this new regulator should focus on the shadow banking entities that operate outside of the regulatory framework and prey on vulnerable people. We have all heard horror stories from our constituents about the bad operators pushing no-money- down or no-doc home mortgages and the reverse mortgage scam artists who sell too-good-to-be-true financing. There must be appropriate oversight of this regulator. The last thing we need is a new government bureaucracy that, under the guise of consumer protection, is really just pushing one party's political agenda. The current business climate is overwhelmed with uncertainty, and we need to ensure this bureau does not create additional uncertainty for any investor or business that operates in this country. The prudential regulators should have a final say on anything that would put the safety and soundness of institutions and the credit of borrowers at risk. Next, Missourians refuse to be on the line for another bank bailout. I share their frustration over the concept of an institution being considered too big to fail. We must put an end to too big to fail. We need a mechanism in place that allows for immediate liquidation of failing financial firms. In my recent conversation with Larry Summers, I expressed this concern, and he agreed that the administration wants euthanasia for failed companies, not resurrection. The government should not be in the business of creating zombies. The era of bailouts must be over. Any mechanism of resolution must be fair and evenhanded. Missourians will not accept government bureaucrats picking winners and losers in creditor repayment. In addition, the $592 trillion over-the-counter derivative market needs stronger rules of transparency. Some of the derivatives traded in this market played a significant role in the recent credit crisis through products such as credit default swaps. These and other transactions--which I call video game transactions, where there is no substance involved and they are making bets on the financial system-- should have been cracked down on by the Securities and Exchange Commission. However, there is an important distinction to be made here. Not all derivative contracts pose systemic risk. As a matter of fact, commercial contracts initiated, for example, by energy companies, utilities, and the agricultural industry are used to manage risks associated with daily operation, from cost fluctuations in materials and commodities to foreign currency used in international business. These end users, as they are called, do so in order to plan for future pricing so they can provide the least expensive good or service to their consumers as possible. Costly margin requirements for these end users will be directly passed on to families. This will increase the cost for Americans to turn on their lights and put food on their tables. My hope is that the ultimate Senate bill, like the House-passed bill, will ultimately address this concern with a strong exemption for end users from the clearing and margin requirements. These end users are not major swap participants and should not be treated as such. Finally, the Federal Reserve Bank's current structure for regulatory oversight ensures that responsibilities and power are shared across the country, not just in Washington and on Wall Street. Regional reserve banks give all regions in the country a voice in banking, credit policy, and monetary concerns, which gives a complete picture to the Board of Governors as they decide on Federal monetary policy. This system was established over 100 years ago and should be maintained in order to protect the concerns of small and medium-sized banks. Financial crises can and do occur within small but interconnected banks, which is why the Federal Reserve needs to continue to take the economic temperature of the entire country, not just of those on Wall Street. As hard-working Americans and small businesses struggle to emerge from this meltdown and drive our economy through the recovery process, it is the responsibility of the Federal Government to ensure we have a robust regulatory system. It is critical that our regulatory system be modern, responsive, and empowered with appropriate authority, while allowing for business prosperity as we prevent future crises. In Missouri, I have been working to build an agricultural biotech corridor. This has the potential to foster a whole new interest, providing great jobs in advanced agricultural research and biotech. It is the best stimulus to create high-paying, skilled jobs that rural Missouri and rural America need. However, today I read in the Wall Street Journal a very disturbing report that this bill would possibly kill small business startups by delaying and limiting the availability of private investor seed capital. Small startups have been at the forefront, driving job creation. In this bill, new requirements by the SEC would insist that investors register with the Commission for a 4-month review, meanwhile tying up vital venture capital or seed capital dollars. This harmful delay for new businesses in need of immediate capital would be crippling. According to the Wall Street Journal: No one believes angel investors pose a systemic risk, so it's hard to understand why these proposals are in the bill. The economy needs more private job creation. Incidentally, it would triple the minimum wealth of the seed capital investors who could invest in these from $1 million to over $3 million. That cuts out three-quarters of the people who might invest in starting up these companies. This would be devastating to rural job creation in Missouri and across the country. Our greatest potential for new jobs depends upon the innovative ideas, the entrepreneurship of people who are willing to use their own time and ideas but need seed capital to do it. These small companies could not wait 120 days, in many instances. They could not find the seed capital investors. In other words, in sum, moving from too big to fail, this new bill, if enacted with that provision in it, would say to these innovators, these entrepreneurs: You are too small to succeed. This is not a measure that is going to protect people from Wall Street; this is an overreach by the Federal Government which would shut down the job creation Main Street needs. Neither political party has a monopoly on good ideas. Reforming our financial system is too important to be done on a partisan basis. I urge my colleagues, and I hope they will consider the ideas I have heard from Missourians. We haven't just been listening to Wall Street; we have been listening to Main Street. I hope the Presiding Officer and all of the Members of this body will listen to what they are saying on Main Street about the need for the small companies, whether they be startup companies or small banks, to succeed. We need to make sure we don't kill the backbone of our American economy. Madam President, I thank the Chair. I yield the floor, and I suggest the absence of a quorum.

Mr. BOND

Mr. BOND. Mr. President, one of the many blessings of being a U.S. Senator is the opportunity to be exposed to so many people who strive, work together, and improve their communities and our Nation every day. Despite hardship, America is a place where Americans face challenges as opportunities determined to see that tomorrow is always better than today. One powerful example is the partnership that exists in St. Joseph, MO, between community leaders and the Missouri Western State University. How pleasing it is to have members of the forward-leaning St. Joseph Area Chamber of Commerce led by Ted Allison come to Washington and, as usual, front and center among the distinguished group is the president of the University, Dr. Robert Vartabedian. How powerful it is to have Mr. Allison testify before the House Committee on Small Business, represented by his Congressman and committee ranking member, Sam Graves, and speak passionately about the job-producing power of the small business community such as exists in St. Joseph, and the importance of education to support small business productivity and growth. Dr. Vartabedian, and his predecessor, Dr. James Scanlon, share the view that the University does not exist in isolation but that the University should understand and serve the community just as the community, in this case, the Chamber of Commerce, and others, serve the University. Dr. Scanlon, who retired after 7 years in June of 2008, was a tireless head of the school and advocate for the community. Integrity and intellect served Dr. Scanlon's action-oriented approach which insisted upon customer-based performance. He never rested and he did not allow members of the St. Joseph community to rest either. After all, the community included future employers and neighbors of his kids and Dr. Scanlon was interested in them having productive and happy lives far beyond graduation. Originally a New Yorker, of all things, one would think Dr. Scanlon always lived in St. Joseph and intended never to leave, but his remarkable footprint continued under the current leadership and has provided a foundation for continued vision and performance. ``Oh happy day!'' became his trademark exclamation, and while I hope it was for Dr. Scanlon, I am certain that because of him, it has been for thousands of students and their faculty and community members. In a large part thanks to Dr. Scanlon, and now, Dr. Vartabedian's leadership, Western has thrived, becoming a source of pride for the community, region, and state. Western's statewide mission is applied learning. Remarkably, about 90 percent of Western students completed at least one internship, practica, or faculty-student project by the time they graduate. In other words, Western students have classroom and real-world experience. Since 2001, the college has become a university, experienced its fifth straight year of record enrollments, doubled its laboratory space for sciences, undertaken to fill its capacity at the new Science & Technology Incubator, built up modern math and science capacity, began a new M.S. program in Nursing, became the summer home of the Kansas City Chiefs, and has seen the establishment of the Steven L. Craig School of Business. According to Missouri Western, the gift by Mr. Craig that made the new school possible ``means serious business for Western.'' The generosity by Mr. Craig will not only launch another valuable path for students to develop value, but represents a strong endorsement of the Western program, and the sense of community in St. Joseph where Craig was born. Mr. Craig graduated from nearby Savannah High School before moving to California to graduate from the University of Southern California. He founded the Craig Realty Group, a Newport Beach, CA, company that owns and manages 13 upscale factory outlet centers in 6 states. The gift of $5.5 million was one of the very largest in the Nation and the largest individual gift to the university's foundation. In addition to being the largest individual gift to the university, these funds will directly enhance St. Joseph, MO, the Midwest region, and will be used to develop tomorrow's business leaders who should follow not only Mr. Craig's business model, but his model of selfless philanthropy as well. Missouri Western officials recognize that Mr. Craig's gift celebrates three of his qualities: entrepreneurial spirit, generosity, and faith. This conspiracy of goodness by a true working community on behalf of a future community membership is a model to applaud and to emulate. Doctors Scanlon and Vartabedian, Mr. Allison, Mr. Craig and all those who have locked arms with you leaders to plow forward, thank you and well done and, more importantly, well doing.

Mr. BOND

Mr. BOND. I thank my colleagues on the other side of the aisle. I believe there is a UC that the assistant majority leader wishes to make.

Mr. BOND

Mr. BOND. Madam President, I thank the Chair and all of my friends for giving me this opportunity to speak. For Americans, the world changed on September 11, 2001. We learned-- at the cost of thousands of innocent lives--that treating terrorism as a law enforcement matter won't keep Americans safe. My real concern is that this administration doesn't understand that every day now is like September 12. We cannot afford to revert back to a 9/11 mentality. Instead, we need to treat the terrorists as what they are--not common criminals but enemy combatants in a war. I rise today to speak about my concerns with current terror-fighting policies of this administration and the vital importance of congressional oversight. Protecting this Nation from terrorist attack is our highest duty in government. In our great democracy, congressional oversight plays a critical role in ensuring that our government protects our citizens from terror attacks. Unfortunately, some in the White House don't agree. Just this morning, a White House spokesperson on MSNBC charged that ``politicians in Congress'' should keep their opinions to themselves when it comes to one of our most vital national security interests-- counterterrorism. I note in the previous administration, my colleagues on the other side of the aisle were quite free to speak about their views on the policies. Mr. Brennan, the Homeland Security adviser, wrote an editorial in USA TODAY critical of congressional criticism of the administration's counterterrorism policies and called them fear- mongering that serve the goals of al-Qaida. I welcome comments of substance from the administration and from the other side on the criticism and the points I make, but you are not going to be able to silence the legislative branch. To do so is unworthy of the democracy we defend. One might believe that some were trying to shift attention away from the decisions that were made in recent years. The bottom line is that my real beef is not with the White House spokespeople--although it is disappointing when the National Security Adviser claims that I have not told the truth about what he said--but with the dangerous policies of the administration. Clearly, my complaints are not directed at the men and women of the intelligence community--which was an insinuation by the White House spokesperson-- because I believe the men and women of the intelligence community are doing their very best job under at best difficult circumstances. What I am concerned about is major broader policies over which they have no control have been changed in a way to make their job more difficult, and we should not be making their job more difficult. One of the dangerous cases of ``ready, fire, aim'' and national security policies was the President's pledge to close the terrorist detention facility at Guantanamo Bay without any backup plans for the deadly terrorists housed there or how to handle them or how to treat them. There has been a temporary suspension of transfers of Gitmo detainees to Yemen and Saudi Arabia, but we understand the larger effort to transfer and release other dangerous Gitmo detainees continues. Let me be clear. The previous administration released terrorists and sent them back to their homeland, some for rehabilitation, and 20 percent of them--1 out of 5--have returned to the battlefield and a couple of them apparently were coaching and training the ``Underpants Bomber.'' That was a big mistake. Stop making the mistakes. We can learn from the mistakes we have made in the past. If we send more back, they will be attempting to kill more Americans. We shouldn't compromise our security here at home and the lives of our soldiers overseas to carry out a campaign promise. If a campaign promise doesn't square with national security, I humbly suggest that national security should prevail. There is another case, the administration's decision to end or to bypass military commissions for detainees who are ready to plead guilty, as Khalid Sheikh Mohammed was, to move him to New York City for the show trial. I will address that later. But the administration continues to prepare to try senior al-Qaida detainees in U.S. article III criminal courts rather than the military commissions that Congress designed for these difficult and complicated cases, to be used in a courtroom that we constructed at Gitmo. History has shown that civil criminal trials of terrorists unnecessarily hemorrhage sensitive classified information. The East Africa Embassy bombing trials made Osama bin Laden aware of cell phone intercepts, and surprisingly al-Qaida and Osama bin Laden started using different methods of communications. The trial of the first World Trade Center bomber Ramzi Yousef tipped off terrorists to another communications link that provided enormously valuable information. Well, their use of that link that we were able to compromise was shut down because they learned about it. Similarly, the trial of the ``Blind Sheik'' Omar Abdel Rahman provided intelligence to Osama bin Laden. The trial of Zacarias Moussaoui resulted in the inadvertent disclosure of sensitive material. That is why former Attorney General Michael Mukasey, who tried some of these cases, said you cannot prevent a defense attorney from getting classified, highly confidential information in the course of an article III criminal trial. We know for a fact these civilian trials have aided the terrorists by giving them information on our Intelligence Committee. The military commission system--and we passed a measure to regulate the sign-in law in 2009--was designed to protect our sensitive intelligence sources and methods and to comply with the laws of war. Why abandon them? It will come as no surprise to my colleagues that I also disagree with the administration's ``ready, fire, aim'' strategy of handling the Christmas Day bomber. On December 25, when Abdulmutallab landed on our shores, rather than incorporate intelligence into his interrogation, he was, after 50 minutes of brief questioning, Mirandized and offered a lawyer. Not surprisingly, he clammed up for 5 weeks. Intelligence is perishable and that 5 weeks was time that our intelligence system should have been operating on the questions he was only 5 weeks later answering. I don't know what purpose there was in Mirandizing him. That is an exclusionary rule. The only reason to offer Miranda rights is so you can use the words of the suspect against him. There is plenty of evidence of this guy who had strapped chemical explosives to his legs, set them off, and burned himself in front of 200 witnesses. It doesn't matter what he says, you can convict him. Why weren't our intelligence agencies consulted on the important decision of whether to Mirandize him? At least the FBI agents questioning him should have had the benefit of the intelligence that other agencies knew. Who is running the war on terrorism? I am afraid it is the Justice Department or the White House. Why did the White House announce what the few of us who were notified of his cooperation warned not to disclose? Not only did they disclose that information the day after we were advised, they disclosed the fact that Abdulmutallab's family came here to pressure him. Why on Earth would you do that? What message does that send? Unfortunately, to the family, they now have targets on their backs, because the terrorists know that they have convinced a member of their family to talk. What does it say to future sources? We are going to be concerned if they provide information that our intelligence agencies asked for that they will be identified by the White House and put at great risk. The handling of the Christmas Day bomber also showed something else. When the President took away the powers of the CIA to question terror suspects, he said: We will handle it in the White House. We found out on December 25, 11 months after he announced it, that there was no high value detainee interrogation operation set up. They had no plans on how to do it. These people are supposed to be interrogating high value detainees and for a year they didn't set it up until after the attack. Our intelligence chiefs testified early this month in an open hearing that there will be attempts by terrorists to attack again. Yet the administration waited until after the attack to begin the process of setting it up. These are all important policy questions to raise. If the White House had its way, I wouldn't be asking them, but I am asking them because I am very fearful that our security has been lessened, and that this is a subject this body must address. Article I of the Constitution created a legislative branch to help ensure that nobody in government is above oversight and being held accountable. I as a Senator have a right and responsibility as a Member of this body and as a representative of the people of my State to shine a light on policies that I think need to be changed, and I will continue to do so regardless of what is said about me. I am concerned that these policies of the administration have moved us back to a pre- 9/11 mentality. That failed in the past and it will again. In terms of the debate, my colleagues from California and Vermont have raised questions in a letter. They said we ought to try these terrorists in an article III court because the rule of law must prevail. Well, I agree, but we have a law. It is called the military commissions law that was passed and signed into law last year by the President that carries out the laws of war. Those are places which are much safer in terms of handling the terrorists, in terms of handling classified information. Finally, they say that we should not--they strongly believe we ought to bring all of these people to article III courts and the prosecutors and everybody can handle those. It is not the prosecutors or the intelligence community we are worried about, No. 1. It is the cost, because the terrorist trial is going to bring undesirables here, and the city of New York figures it is going to have to spend over $2 million a year. They do not want it. Nobody else wants it. I tell you, even more important, when Khalid Shaikh Mohammed was apprehended, he said: My lawyer and I will see you in New York. He wants to come to New York or Washington or someplace where he can get a lot of media attention--and believe me, were he to be tried here, he would get a lot of media attention--because he wants to be able to spread his message to others who might be vulnerable that they need to join him in the jihad. I also pointed out that disclosure of sensitive information has and will be released if you try him in an article III court because any defense attorney bound to provide the best defense for their clients will have to get into what the intelligence community knew, how they knew it about him, and that is a disaster. That is why I welcome the discussion and I urge a change in policy. I yield the floor.

Mr. BOND

Mr. BOND. Mr. President, I rise to shed some light on the situation going on at the General Services Administration, the GSA, a tangled mess of bureaucracy I have been fighting for the last 5 years. In the past, I worked very cooperatively with GSA, but for some reason, somehow, they have gotten themselves and us into a situation that is untenable. Yesterday, the President accused me of holding hostage the nominee to be Administrator, Martha Johnson. I feel no joy in holding up this nominee, but the hostage I am concerned about is not the one looking for this distinguished position in Washington. Instead, the hostages I am worried about are the 1,000 people working in a Federal office building dump in Kansas City at the mercy of an agency that refuses to act to remedy a problem they acknowledge exists. Again, the hostage, with due respect, is not Martha Johnson; the hostages are the 1,000 Kansas City workers at the Bannister Federal Complex. As Senators, we have a few tools at our disposal to carry out our responsibilities. One of these important responsibilities is oversight of the Federal Government. One of those tools is to force the Senate to debate and actually vote on an issue rather than be just a rubberstamp to the administration. While he has criticized me for using this oversight tool, the President wielded it himself when he was a Senator in this very Chamber. Senator Reid, our distinguished leader, shares some responsibility in delaying Martha Johnson's confirmation. You see, the Johnson nomination actually passed out of committee in May. Was she ever called up for a vote? No, because until July--when I formally placed a hold on the nominee--the Senator from Nevada, according to Congress Daily, delayed her confirmation to ensure that taxpayer dollars were still being used to send Federal employees to Las Vegas. Senator Reid has his priorities regarding the delay on this nomination, and I have mine. He wants more Federal employees able to come to Las Vegas, and I certainly understand his reason; it is very important for his State. I want Federal employees in Kansas City to work in a building with a roof that doesn't leak and doesn't have other risks of contamination. Some are complaining about the delay of this nominee. The truth is, the majority leader could have confirmed Martha Johnson in May, June or July. In addition, he waited until Thursday to file cloture, and he could have picked any date in the last 7 months to do so, but he waited until last Thursday. We had thought we made progress, and every time we thought we made progress, somebody in the administration pulled back that small step of progress. There are many reasons why a Senator might wish to place a hold on a nominee that are related to our oversight responsibilities. I think it is important to have debates such as this not only when the qualifications of the nominee are at stake but when a Federal bureaucracy stops being responsive and serving of the people in the communities in which they work. That is the real issue. Martha Johnson's qualifications are not in doubt. But as you will hear, the GSA is not being responsible to the people of Kansas City and, most specifically, to the Federal workers there. The history goes back about 5 years. It is part of a larger plan to move all tenants out of the dilapidated Bannister Federal Complex. GSA initiated a plan to construct a new building in downtown Kansas City in order to move the jobs out of the complex. That was a long time ago, and at the time they were looking for a lease-to-own process. The community of Kansas City--the leadership, elected officials, the employees, and Kansas City's financial community--had worked with the GSA to get a building--a new building to replace the Bannister Federal Complex. The existing building, by any stretch of the imagination, is extremely expensive to operate, will be sparsely occupied, is not conducive as a good workplace, and must be replaced. After 3 years, the plan brought together, with GSA's participation, the leadership of the Kansas City community at all levels, from the mayor to the council, to the business community, the Finance Committee that was going to put up the money. They came together, and they got a commitment that financing would be available to construct on a lease- construction basis. What happened? With no warning, GSA called up the Environment and Public Works Committee the week of the markup, when it was supposed to be approved, and effectively put their own hold on the project they developed and approved, citing GSA's shift away from proceeding on a lease-construction basis. For anyone following the project, this latest move by GSA was very difficult to understand. After all, 3 months earlier, in June of 2008, GSA was holding roundtables with real estate developers on the value of lease-construction plans and telling them how they could seek and pursue such projects. In scrapping their own plan, GSA ensured that after all other tenants vacated the inefficient, 5.2-million-square-foot complex, more than 1,000 Federal employees would be stuck working there. That is about 5,000 square feet per employee. This nonsensical plan would cost taxpayers $13 million to $15 million annually just to mothball unused space and operate shared heating and cooling equipment. That is $13,000 to $15,000 a year per employee for the unused space. GSA was so convinced this was the best path forward that for 9 months, they even went so far as to conduct an analysis to justify the continued use of the Bannister Complex. But then, in a 60-day analysis, ``GSA concludes that the Bannister Complex should be a mid-term hold (approximately 15 years).'' This translates into nearly 10 years of continuing to run a complex at 20-percent capacity. Does that make sense? I cannot figure any building manager, any responsible party in the private sector or in government who thinks that works out. It does not take a mathematician to figure out the numbers. They are not good for the taxpayers. Put pencil to paper on that. Pencil it out. Anybody can do that. However, yet again, GSA decided to change its mind in September of 2009. This time, GSA agreed to their original position that a new building in Kansas City was GSA's ``preferred option.'' Bear with me. I know this is getting confusing because we have been confused. Imagine how the Kansas City community feels after being jerked around for 5 years, where we sat down and worked with the staff, and a very helpful staff decided--laid out the path forward. That sounds like a good idea. Everybody at home was on board. The Kansas City community was on board, the officials, and we said, fine. Then somebody in the administration, whether GSA or above, put a halt to every one of those steps forward--every single one of them. Every time they laid out something, nothing happened. We are beginning, quite honestly, to feel like Charlie Brown. Every time we get ready to kick the football, somebody in the administration moves it. Where are we now, now that the GSA went back to their original objective that they earlier rejected? Unfortunately, we are not one step closer to a new building for these workers. GSA has still taken no action, still has put nothing on paper, has made no commitments. Is there a way forward? What is their way forward? Let the people of Kansas City know what you are going to do, how you are going to do it, and when you are going to do it. We cannot even find that out from them. There is no official plan out of GSA. GSA clearly agrees that the new Federal building is needed, so it should not be asking too much for somebody who represents them and the community to be told their plan. Yet they have stubbornly refused to produce one. I met with Ms. Martha Johnson. I have worked with the PBS Commissioner. They are fine people, wonderful people. I think they are very qualified. But I have asked repeatedly that GSA come up with an official plan to move Kansas City forward. They refused. Bureaucracy has broken its word once again, and I want a chance to tell my colleagues what they have done. My bottom line, the reason I am on the floor today opposing this nomination is quite simple: As Missouri's senior Senator, my job is to fight on behalf of the people who sent me here. My job is to make sure bureaucrats in Washington do their job and serve the people across the Nation and in Kansas City. GSA continues to ignore the Kansas City community. My efforts have always been about keeping 1,000 jobs in Kansas City, not blocking one position in Washington. But my colleagues should be aware that there is more bad news at this very same Bannister Federal Complex. At the same time GSA has been unwilling to move forward on a new building, they have also apparently been unresponsive to the ongoing health concerns of their employees and tenants at the Bannister Federal Complex. In the next day or so, tests will come back on the levels of trichloroethylene, or TCE, a dangerous carcinogen, at the Bannister Complex. These tests were called for after a local TV station reported unexplained illnesses afflicting Bannister workers and a possible link to toxins, such as TCE and beryllium, at the complex. While the pending results of these tests are of great concern--they are of great concern to the employees and their families, but most of all, we are hearing from parents whose children were in a daycare center at the complex. They want to know to what their children might have been exposed. These scares and reports are coming more and more frequently to us from the Bannister Complex. It is alarming that I learned about this information not from GSA but from the media. Based on media reports, the implications for the health of these workers could be very serious, so I have called for an investigation. I even asked the inspector general of GSA to get to the bottom of these alarming health allegations. I will work with the proper authorities on all levels of government-- the Environmental Protection Agency, the Missouri Department of Natural Resources, the Missouri Department of Health, the Agency for Toxic Substances and Disease Registry--to uncover any additional information. It goes without saying that I will demand more transparent and comprehensive testing throughout the Bannister Complex. For the safety of the workers, we need to know what is going on, what is happening at Bannister, what has gone on in the past, who knew about it, why they did nothing about it, and how to move immediately to protect those potentially at risk. The bottom line is that these workers deserve answers. The situation at GSA tells the American people that all they can expect out of Washington right now is business as usual, keep going forward, don't listen to the people we are supposed to serve, a government that is out of touch with their concerns and slow to act. I do not support business as usual. For these reasons, I will vote against the nomination and ask my colleagues to do the same. Mr. President, I yield the floor.

Mr. BOND

Mr. BOND. My colleague and chair, Senator Murray, is correct. The names were added as a result of a clerical error, and Senators Wyden and Merkley should not be listed as sponsors. In addition to this project, there are additional projects for which Senate names were inadvertently left off of the attribution table. I have confirmed with my staff that the Senators listed below did request the following projects, which have been properly disclosed and for which they have certified that they have no pecuniary interest. Specifically, the projects, the account in which they are funded, and the additional sponsors are as follows: I-49 North, LA, interstate maintenance, Senator Vitter; Interstate 69, LA, interstate maintenance, Senator Vitter; I-12 Interchange at LA-16, LA, interstate maintenance, Senator Vitter; I-20 Lincoln Parish, LA, Delta Regional Transportation Development Program, Senator Vitter; Clearview at Earhart drainage, LA, Delta Regional Transportation Development Program, Senator Vitter; Rail spur extension--Greater Ouachita Parish, LA, rail line relocation and improvement, Senator Vitter; Greater Ouachita Port Surface Development Project, LA, Economic Development Initiative, Senator Vitter; Earthworks Engineering Research Center--EERC, Iowa State University, IA, transportation planning, research, and development, Senator Grassley; Jet engine technology inspection to support continued airworthiness--JET, Iowa State University, IA, transportation planning, research, and development, Senator Grassley; Interstate 74 corridor construction, IA, interstate maintenance, Senator Grassley; Alice's road extension/Ashworth Road to University Avenue, IA, surface transportation priorities, Senator Grassley; Construct four lane highway 20 West of U.S. 71, IA, surface transportation priorities, Senator Grassley; Iowa Highway 92 reconstruction, surface transportation priorities, Senator Grassley; Roger Snedden Dr. extension/grade separation--phase 1, IA, surface transportation priorities, Senator Grassley; University Boulevard widening, Clive, IA, surface transportation priorities, Senator Grassley; Iowa Highway 100 extension and improvements, Cedar Rapids, IA, surface transportation priorities, Senator Grassley; I-480/Tiedeman Road interchange modification, OH, interstate maintenance, Senator Voinovich; I-76 Access/Martha Avenue connection, Akron, OH, surface transportation priorities, Senator Voinovich; and Warrensville/Van Aken Transit Oriented, OH, surface transportation priorities, Senator Voinovich.

Mr. BOND. I thank the chair for her assistance in this matter.

Mr. BOND

Mr. BOND. Mr. President, I ask to be advised when I have used 8 of my 10 minutes.

Mr. BOND. Mr. President, small businesses are the backbone of our economy. They make up 99.7 percent of all employer firms. They employ just over half of all private sector employees. They pay 44 percent of the total U.S. private payroll. They have generated 64 percent--a majority--of the net new jobs over the past 15 years. They create more than half of the nonfarm private gross domestic product, and they hire 40 percent of all high-tech workers. Small businesses drive this economy. They are also the sector most in need of real health reform that will reduce cost and make it easier to buy insurance. It is estimated that 26 million of the uninsured are small business owners, employees, and their dependents. That is a majority of the uninsured. They continue to struggle to be able to afford health care. Here are two examples: Jim Henderson, president of Dynamic Sales in St. Louis, has made every adjustment in the book to continue to provide health insurance to his employees. He covered both employees and their families back in the 1980s, but he is now at a point where he can only afford to provide for his employees. He pays 70 percent, his employees 30 percent. Jim is one of the very few small businesses that right now have weathered the storm despite the economy. He wants reform that lowers cost and helps individuals better spend their health care dollars. Unfortunately, the Democratic health care bills we have seen so far-- and I guess we haven't seen all of them--won't help Jim to continue to provide his employees health care. Kathie and Tom Veasey own True Value Hardware in Wilmington, DE, the hometown of Vice President Biden. They employ 28 people, most of whom they consider family. They cover 100 percent of the cost for their employees and half for their families. But they have seen huge increases in premiums over the years, with a 36-percent increase just this year after an employee got sick. Each year, they are forced to shop for health insurance, but they continue to have limited choices due to an uncompetitive market. Unfortunately, the Democratic bills won't fix the problem or help Kathie and Tom continue to provide their employees health care. If we really want to get out of this recession, if we really want to address the problem of affordable and accessible health insurance, then the majority party needs to take a hard look at health care reform. First of all, we need to allow small businesses to go together and purchase health care across State lines so they have true competition and so they can lower costs. We need medical malpractice reform, which would cut $120 billion to $200 billion out of the cost of health care. However, when we look closely, the bills we see before us do not address the real health care needs, and, in fact, by imposing more taxes--and taxes which the CBO said will be passed from health care companies down to those who are paying the private bills--not only will it make health care less affordable for these small businesses, it will force many of them to drop whatever coverage they have now. Tax equity is extremely important. An employee of a large corporation or a union member who gets health care premiums paid for by their employer or by their union doesn't have to record them as income. Small businesses, their employees, farmers, and individual purchasers need the same benefit that the employees of large corporations and union members get. Now, instead of proposing commonsense health care solutions for small businesses, the bills we have seen coming out of the smoke-filled rooms run by the majority leader continue to heap costly new burdens on small businesses that are trying to keep their doors open. More and more it seems small businesses are under attack, and that is what they are telling us. One of the universities that visited me this past week is trying to do something to help small businesses, and I said: What is the attitude? They say: The attitude of small business is that they are under attack by what is being done in Congress and what is being proposed by the administration. The 2010 budget calls for tax increases on those earning $250,000 or more. For small businesses that are taxed at their personal rate-- proprietorships, partnerships, and sub S corporations--these tax increases hit the returns of those small businesses, and they are taxed at the punitive rate. Higher energy taxes on businesses in the cap-and- trade plan will put many small businesses in my part of the country out of work. New taxes and new mandates in the health care bill will be passed on. Randy Angst of Lebanon, MO, says the following about the Senate bill: The new taxes would eliminate roughly half of my profits. It would force me to let employees go, refrain from hiring new employees and prevent me from reinvesting in my business. The mandates would be very harmful and make it much more costly for me to operate my business. This bill--the last bill we have seen--requires a costly $28 billion new mandate on businesses that do not offer health care. Who pays that mandate? Anybody looking for a job. If you tell businesses they have to spend big money on a mandate, they cannot spend it on hiring new workers. The mandates do nothing to reduce insurance costs, and because they are focused on full-time workers, the mandate gives companies an incentive to classify more of their workers as part time. Gene Schwartz, with K&S Wire Products in Neosho, MO, says: We are in a recession and I am in manufacturing. The legislation would be nothing but detrimental to us. Our workforce is already down 25 percent from last year, and if this bill goes through in its current form, the new taxes and mandates will force me to make further cuts. Also, this bill will increase my costs by further raising my already sky-high insurance premiums. This bill also includes more paperwork which is costly for a small business. Section 9006 requires that every time a business vendor sells a service or property exceeding $600 to another business, the receiving business must report the transaction to the IRS. That is an enormous new costly paperwork burden that will hit almost every business regardless of how small. These mandates and regulations disproportionately affect small businesses and come at a high cost. According to the SBA's own Web site, very small firms with fewer than 20 employees annually spend 45 percent more per employee than larger firms to comply with Federal regulations. These very small firms spend 4\1/2\ times as much per employee to comply with environmental regulations and 67 percent more per employee on tax compliance than their larger counterparts. The bill clearly fails to bring down the cost of health care for small businesses. It fails to bring down the cost of health care at all, but it is especially hard on small businesses that can't afford coverage under the current law. Small business owners from my State have come to me for two decades looking for more affordable ways to make health insurance available. They want to be able to provide insurance for their people. That is why I have long been a champion of small business health care reform. Does the majority's bill include strong reform that will allow small businesses and the self employed access to more affordable, more accessible health care? No. Does the bill include protections for small businesses that disproportionately feel the burden of increased government mandates and taxes? No. In fact, CBO has said that this bill will increase premiums for individuals in the non group market by 10-13 percent. Premiums for small businesses could increase by 1 percent or be reduced by 2 percent but it is easy math. If a small business cannot afford to provide health insurance now, they will not be able to afford to do so under this bill. According to CBO, under current law families in a small group plan today pay about $13,300. In 2016, they will pay about $19,200 if this bill becomes law. That is the wrong direction. Health care is already too expensive for small businesses. We need to make it cheaper. It should not cost a family $19,200 in 2016 for health insurance. This bill continues down the path of unsustainable health care costs. In fact that is one of the main reasons the National Federation of Independent Businesses opposes this bill. They say, ``Small businesses can't support a proposal that does not address their number 1 problem-- the unsustainable cost of healthcare. With unemployment at a 26-year high and small business owners struggling to simply keep their doors open, this kind of reform is not what we need to encourage small business to thrive.'' This bill also imposes new taxes and fees, like the $6.7 billion per year tax increase on health insurance companies. Yes, the majority wants to sock it to the insurance companies. Well, guess what. The insurance companies are going to pass the costs along to consumers. Small businesses cannot self-insure, they must purchase products available in the marketplace. That is why CBO has found that increased costs due to fees being passed on to the consumer will be more pronounced for small businesses. NFIB has also said this new tax will fall almost exclusively on small businesses. This bill just does not help small businesses. I know the argument my colleagues on the other side offer. They say they provide a tax credit to help small businesses. What they don't say is that this is a bait and switch. First of all, in order to get the full credit, you cannot have more than 10 workers who get paid an average of $20,000. After that, the credit begins to phase out for each employee you have above 10. It also phases out for each $1,000 increase in average wages above $20,000. If you have 25 employees or you pay more than an average wage of above $40,000, you don't even get the credit. The real kicker is that the full credit is only available for 2 years after the exchange takes effect. Then that is it. A small business will either have to offer an employee health insurance--which will really not be any cheaper than it is today--or they will have to pay a fine. Or an employee can go into the exchange as an individual where insurance will cost 10-13 percent more. Let us examine a realistic situation using Jim from St. Louis as an example. As I mentioned before, the small business tax credit is filled with thresholds and variations that make it of limited value for the few small businesses that are eligible to claim the credit. The full value of the credit, which is equal to 50 percent of the business owner's costs, is available for small businesses with 10 or fewer workers that pay their employees an average annual wage of $20,000 or less. But the credit also starts to phase out as the employer adds employees or gives raises, so the entire credit is gone if the employer has 25 or more employees and pays them an average wage of $40,000 or more. Jim has six employees and his average annual wage is about $39,000. Jim has to ask if he meets the two threshold questions before he can determine whether he gets the tax credit. He passes the first test, since he only has six employees. But Jim's credit is reduced because he has paid his employees too much in wages. Today, Jim's health care costs are $30,540. If he qualified for the full value of the credit, his annual health care costs would be $15,270--about half of what he pays now. But the value of his small business tax credit is directly related to wage, so the value of Jim's credit is reduced to $763 based on the formula. That is a small fraction of his health care costs and wouldn't even cover the cost of hiring an accountant to figure out how much the credit is worth. Because Jim is already so close to the highest average wage to be eligible for any credit at all, this means if he gives his employees a well-earned and well-deserved raise, he will lose the credit altogether. In these tough economic times, the government is encouraging small business owners like Jim to create more jobs, but if they create too many or pay people too much, then the government will reward them by taking away their small business tax credit. And even worse, the phase-outs mean that Jim has a disincentive to hire more workers. So this bill completely misses the mark for small businesses. Mr. President, our small businesses are struggling. We owe more to this critical sector of our economy which is responsible for half of the private-sector jobs and employees than a bill that mandates taxes and fails to provide real health care reform. In a recent letter to Senator Reid, the NFIB outlines how the bill will adversely affect business owners. When evaluating healthcare reform options, small business owners ask themselves two specific questions. First, will the bill lower insurance costs? Second, will the bill increase the overall cost of doing business? If a bill increases the cost of doing business or fails to reduce insurance costs, then the bill fails to achieve their No. 1 goal--lower costs. In both cases, the Patient Protection and Affordable Care Act (H.R. 3590) fails the small business test and, therefore, fails small business. They further say in the letter: Despite the inclusion of insurance market reforms in the small-group and individual marketplaces, the savings that may materialize are too small for too few and the increase in premium costs are too great for too many. Those costs, along with greater government involvement, higher taxes and new mandates that are disproportionately targeted at small business and are being used to finance H.R. 3590, create a reality that is worse than the status quo for small business. It is worse than the status quo. Mr. President, it is time to stop attacking small business and work on real reform. We should defeat this proposal that does not make insurance more affordable, is a massive government intrusion into health care and that will pay for new entitlement programs on the backs of our small businesses. Let us put this debate in context. If small businesses do most of the hiring, and we are counting on them to help lead us out of the recession, why would we want to increase their costs of doing business and make it less likely they will hire new workers? President Obama hosted a Forum on Jobs and Economic Growth last week, where he invited ideas to jump start job growth in our sluggish economy. Now, he and the majority are considering a new plan to jump-start job growth using ``unspent'' or returned TARP funds. Have they forgotten that it is all borrowed money, and thus deficit spending, in the first place? Let me submit that the bill before us will hurt job creation. Before practicing medicine, doctors often take an oath, the Hippocratic Oath, where they promise to refrain from doing harm. I would like to see Congress and the President take the same oath. How can you on the one hand legislate new taxes on businesses in the name of health reform--coupled with new energy taxes in the name of climate protection--and on the other hand ask businesses to generate new jobs? It cannot be done. Massive tax increases and job creation are mutually exclusive. Employers who face uncertainty regarding new, oppressive taxes and mandates are not going to want to sink money into new jobs. It is that simple. We should think about the harm we will do to small businesses through this legislation and instead work on commonsense reforms that have bipartisan support. Mr. President, I ask unanimous consent to have printed in the Record the letter from the National Federation of Independent Businesses.

Mr. BOND. Mr. President, I have a couple of other comments I wish to add. We have now learned that there is a new proposal coming out of the back rooms--the smoke-filled rooms. Every time something new is thrown up on the wall, we stand around with a great deal of interest to see whether it sticks. When you look at this one, I don't believe it sticks. I think it stinks. If you read the Washington Post's lead editorial today, its headline is ``Medicare sausage? The emerging buy-in proposal could have costly unintended consequences.'' Mr. President, I ask unanimous consent to have printed in the Record, after my remarks, the Washington Post article.

Mr. BOND. At the end of the article, it says: The irony of this late-breaking Medicare proposal is that it could be a bigger step toward a single-payer system than the milquetoast public option plans rejected by Senate moderates as too disruptive of the private market. To say that it moves toward a public takeover is confirmed by one of the most outspoken backers of the public option, the one most interested in getting public control or governmental control of all of health care, New York Representative Anthony Weiner. He is quoted in Politico today as having hailed the expansion of Medicare as an unvarnished triumph for Democrats like himself who have been pushing for a single-payer run health care system. In the article, he says: ``Never mind the camel's nose, we've got his head and his neck in the tent.'' I think that is clear. Trying to expand Medicare will almost assuredly drive all the private plans out of the market. Why? Medicare pays 80 percent of the cost of hospitals and less for doctors, and they have to make up the rest of their cost by charging privately covered patients more money. It will raise the cost so that private health care can no longer succeed. Exhibit 1 [From the Washington Post, Dec. 10, 2009] Medicare Sausage? The only thing more unsettling than watching legislative sausage being made is watching it being made on the fly. The 11th-hour ``compromise'' on health-care reform and the public option supposedly includes an expansion of Medicare to let people ages 55 to 64 buy into the program. This is an idea dating to at least the Clinton administration, and Senate Finance Committee Chairman Max Baucus (D-Mont.) originally proposed allowing the buy-in as a temporary measure before the new insurance exchanges get underway. However, the last- minute introduction of this idea within the broader context of health reform raises numerous questions--not least of which is whether this proposal is a far more dramatic step toward a single-payer system than lawmakers on either side realize. The details of how the buy-in would work are still sketchy and still being fleshed out, but the basic notion is that uninsured individuals 55 to 64 who would be eligible to participate in the newly created insurance exchanges could choose instead to purchase coverage through Medicare. In theory, this would not add to Medicare costs because the coverage would have to be paid for--either out of pocket or with the subsidies that would be provided to those at lower income levels to purchase insurance on the exchanges. The notion is that, because Medicare pays lower rates to health- care providers than do private insurers, the coverage would tend to cost less than a private plan. The complication is understanding what effect the buy-in option would have on the new insurance exchanges and, more important, on the larger health-care system. Currently, Medicare benefits are less generous in significant ways than the plans to be offered on the exchanges. For instance, there is no cap on out-of-pocket expenses. So would near-seniors who buy in to Medicare get Medicare-level benefits? If so, who would tend to purchase that coverage? Sicker near-seniors might be better off purchasing private insurance on the an exchange. But the educated guessing--and that's a generous description--is that sicker near-seniors might tend to place more trust in a government-run program; they might assume, with good reason, that the government will be more accommodating in approving treatments, and they might flock to Medicare. That would raise premium costs and, correspondingly, the pressure to dip into federal funds for extra help. In addition, the insurance exchanges proposal is being increasingly sliced and diced in ways that could narrow its effectiveness. Remember, the overall concept is to group together enough people to spread the risk and obtain better rates. But so-called ``young invincibles''--the under-30 crowd--would already be allowed to opt out of the regular exchange plans and purchase high-deductible catastrophic coverage. Those with incomes under 133 percent of the poverty level would be covered by Medicaid. The exchanges risk becoming less effective the more they are Balkanized this way. Presumably, the expanded Medicare program would pay Medicare rates to providers, raising the question of the spillover effects on a health-care system already stressed by a dramatic expansion of Medicaid. Will providers cut costs-- or will they shift them to private insurers, driving up premiums? Will they stop taking Medicare patients or go to Congress demanding higher rates? Once 55-year-olds are in, they are not likely to be kicked out, and the pressure will be on to expand the program to make more people eligible. The irony of this late-breaking Medicare proposal is that it could be a bigger step toward a single-payer system than the milquetoast public option plans rejected by Senate moderates as too disruptive of the private market.

Mr. BOND. I thank the Chair, and I yield the floor.