Peter DeFazio

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, today, I voted against S. 3729, the NASA Reauthorization Act because it will ultimately add $230 billion to our deficit to under the ruse that we must land a man on Mars. In 2004, President Bush announced his Mission to Mars initiative, with a goal of manned space flight to the moon and then to Mars. What President Bush didn't reveal was the future costs of Mission to Mars that would swell to astronomic levels and create further havoc with the federal budget. With our economy still in a ditch and our national debt having doubled in the last 8 years, the United States cannot afford to begin a new space cowboy adventure. It is only reasonable that we reassess our budget priorities, just as millions of struggling Americans are reassessing theirs. Tough choices must be made, and manned space expeditions are not worth expanded deficit spending. A 2008 report from the Government Accountability Office reported that NASA has estimated the total cost of the planned Mission to Mars, will have a final cost of over $230 billion. That is not affordable in even the best of economic times. In response to this breathtaking cost estimate, I attached an amendment to the 2008 NASA Reauthorization directing the Congressional Budget Office to update its budgetary analysis on NASA's near term exploration plans for the moon. CBO reported that the average NASA program experiences a 50% cost growth over initial budget estimates, with some programs experiencing a final cost of almost 250% over initial estimates. It goes on to state that in order for NASA to meet its current schedule to get to the moon, it would have t spend $110 billion through 2020. Americans need to know that in these uncertain times we are doing everything we can to restore fiscal discipline and put our economy back on track. We've been to the moon, and we do not need to spend $110 billion to go there again. We certainly can't afford the $230 billion to go to Mars. S. 3729, continues the costly Constellation program and specifically insists on the development of heavy-lift rockets. This bill keeps alive a program that should be eliminated.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I was a bit surprised to hear the gentleman from Texas and a few others on the Republican side find an excuse to oppose this legislation, but, then again, they always find an excuse to side with their international corporate benefactors. He feigned, ``Oh, my god, the American people won't be able to afford shoes for their kids next fall because we won't have those cheap Chinese imports shutting down American factories.'' Now, what the Americans need are jobs. We don't need jobs in China; we need them here. And with an unfairly priced currency, we are losing more and more manufacturing. When the Republicans controlled everything from 1994 to 2006, or the Congress and the presidency for a good part of that time, our trade deficit with China went up 806 percent, and they did nothing. But they can find little problems here and there with this legislation. They are worried about a trade war. We are at war. We are having a trade war with China. They are supporting capitulation, and we are finally starting to fight back from this side of the aisle. No, no excuses. Plain and simple: Are you with the American people and fair trade, or are you with the Chinese and the big international corporations and their excuse for free trade, which is manipulated currencies, trade barriers, and taking our jobs away from our workers. Plain and similar: Where do you stand?

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, the President was on television this week defending his economic policies talking about the progress, and I am going to admit that after yesterday we are about halfway back to where this administration needs to be in putting Americans and America back to work. Yesterday--congratulations are in order--Larry Summers was either fired or encouraged to leave. It doesn't matter, he's gone. It's about a year since I asked the President to fire Geithner and Summers, two people of, by, and for Wall Street. Wall Street has received enough attention, and the Republicans would shower even more attention on Wall Street, should they take over again, against Main Street American working people. It's time this President came back to his Democratic roots, his Democratic values. Geithner needs to go too. Let's bring in a team that cares about working Americans.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, there are many in this chamber who say, and I am among them, that we must be careful with running up the deficit and the debt because we are borrowing from the future. Dollars we borrow today will be paid back by our kids and our grandkids over the next 30 years. In fact, that is why I voted against the so-called stimulus bill. I felt it borrowed too much and invested too little in the future. It cut way back on the transportation infrastructure investments in favor of tax cuts. Borrowing money for tax cuts doesn't make sense. There is no benefit to be passed on to the future generation, and it certainly didn't put people back to work. So as we approach the bill today, we have to keep that in mind: Are we borrowing from the future? And, will this provide benefits to people in the future? The bill before us today would fund education. In my State, we are headed toward having the shortest school year in America. We are stealing from our future. We are stealing from our kids. If they don't get those school days this year, they can't make them up next year or after they have graduated. We are shorting them for the rest of their lives on a good education. We are going to have some of the largest class sizes in America. You can't teach a class of 38 or 40 kids in middle school. It isn't a good educational experience. We are stealing from their future. I am hoping today that the funds we will vote for will be used by my State to plug the holes this year. I don't want to see them sitting on that money and saying, ``Oh, well, maybe things will be worse next year and we will avoid future cuts.'' No. The cuts are today. They are hurting kids today. They need to plug those holes today, put teachers back to work, lower the class size, get the school years back up to a reasonable length. There are other cuts that can be taken care of by this vote again today. In my State, we are cutting back on State police even though we have one of the lowest ratios of policing in the United States of America. We have an epidemic of people in our rural areas who do not have adequate law enforcement and are being plagued by crime and drug dealing and other things. We need more State police on the roads. Our seniors need to be maintained in their homes, Oregon Project Independence. Our community colleges are cutting back at the same time when they are seeing record enrollment from people who are trying to get a job in a bad economy. Those holes can be plugged today. But are we borrowing from the future with this legislation? Well, no. Actually, for once, we are paying for it. Now, we are going to hear a lot of whining on the Republican side of the aisle about, oh, this is bad and this is more just borrow and spend. No. What they are really going to be whining about is the fact that we are closing some very juicy foreign tax loopholes for U.S. corporations. We have little things that are called the hopscotch of deemed dividends. We have the Cayman Islands, Bermuda. Sound familiar? And we have daisy chain investment overseas so they can avoid U.S. taxes. When we built the greatest Nation on earth, corporations paid 40 percent of the taxes in this country; today, they pay 7 percent because of loopholes like this. This bill will close the loopholes. Now, the Republicans will gnash their teeth over that because there has never been a loophole too good for them. They want more loopholes. And they should like this part, and I have some doubts about this, but it is going to reduce food stamp benefits in the future by $12 billion. Now, they always carry on about welfare and welfare cheats. I have got a lot of people dependent upon food stamps who were formerly hard working in my district and my State. But the balance here of essential public services, of a decent education for the future, and those cuts, I can accept. And getting rid of the corporate loopholes, I am with that every day of the week. The Republicans are for loopholes. We are against them. We are for education, we are for kids, we are for vital public services. They are not.

Mr. DeFAZIO

Mr. DeFAZIO. We have an obligation to the future to stop borrowing and spending, and actually, today, we're going to meet emergency needs across America and we are going to stop borrowing, but we are going to do something the Republicans really hate. We are going to close some unbelievable, abusive, foreign tax loopholes. They're called daisy chain hopscotch dividends that are deemed in Bermuda and the Cayman Islands, among other exotics. You know, when we built the greatest country on Earth, corporations paid 40 percent of the taxes in this country. Today, Republicans are paying 7 and Republicans think that's just too much. Well, we've got a choice: cut $10 billion in abusive foreign tax loopholes and fund our kids' education so we don't have the shortest school years and the largest class sizes in America, or continue business as usual to subsidize those corporations and allow them to hide money overseas. I know how the Republicans vote. I'm voting with the kids.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, it's my understanding that the chairman is going to accept the amendment.

Mr. DeFAZIO. Given that, Mr. Chairman, I yield back the balance of my time.

Mr. DeFAZIO. I have an amendment at the desk.

Mr. DeFAZIO. I yield myself such time as I may consume. We need a 21st century transportation policy for America. We need to move beyond the constipated transportation policies of the Bush era that are allowed and have allowed our system to deteriorate: 150,000 bridges on the Federal system in need of substantial replacement or repair; transit systems with an $80 billion backlog for equipment. They're running obsolete railcars right here in the Nation's Capital that are killing people. They should have been retired years ago. They need to be replaced. We have frustrated commuters wasting hundreds of thousands of hours and billions of gallons of fuel caught in congestion; businesses and industries crying out they need help for just-in-time delivery and their trucks are delayed and detoured. On October 1, we were supposed to do a 6-year bill to direct the investment in the system and enhance the investment. And that bill would have included a major new program for metropolitan mobility and access and had an office of livability. But the Obama administration stopped the bill, and they've refused to come to the table and discuss how we can move forward and make these needed investments. But now the Secretary would like a little cherry, which would be like an office of livability, not defined, and he'd like $200 million, at his discretion, whatever he defines livability as, to give grants to whomever he wishes under whatever criteria he might, in the future, propose. Now, this would be, given the state of disrepair of our system and the deterioration of our system, a lot like buying a brand new tire and rim to put on a junk car that's up on blocks. It's not going to get anybody anywhere. It's not going to meaningfully address the problems of the system. We need a comprehensive approach. I reserve the balance of my time.

Mr. DeFAZIO

Mr. DeFAZIO. If you care about a new 21st century transportation policy, if you care about the fact that the United States of America is falling behind because of the state of disrepair of our system, the delays for our businesses and industry, the lack of competitiveness because of that system, if we look at what our competitors are doing to build out new systems and efficient systems, if you care about those things, you will vote for my amendment. Strip the $200 million from an unauthorized program. Remember, this is an appropriations bill. You're not supposed to create new programs or authorize things. All we say is, it's subject to authorization. That is why I'm happy to look at the $200 million or even more for an office of livability in an authorizing bill. Let's have a meaningful discussion. Let's get it done. Don't let the administration cherry-pick and end-run us.

Mr. DeFAZIO. I thank the gentleman for yielding. I want to thank the Rules Committee and Chairwoman Slaughter for making my amendment in order, which was referenced by my good friend and colleague from Oregon (Mr. Blumenauer) earlier. We need a new transportation policy for this country. We need a 21st century transportation policy. We're living under the Bush-era priorities and policies and inadequate funding. We have a system with 150,000 bridges that are weight-limited or functionally obsolete. We have transit systems across the country that have an $80 billion backlog just to be in a state of good repair, let alone building out new transit options for Americans. People are dying because of that capital backlog. They're dying right here in the Nation's capital where they're running obsolete, crummy, old rail cars that aren't safe. We have a transportation crisis, and I've written a bill, along with Chairman Oberstar, that will address more robustly than a provision stuck in here by the Appropriations Committee the issues of livability and planning in a coordinated way for a better transportation future, more options for people who live in congested metropolitan areas. But tell you what, if you take and create that with, say, $200 million--and my colleague was wrong; it is $200 million that comes out of the trust fund. That means it's $200 million that we don't have to help deal with those 150,000 bridges that need to be repaired or replaced. That's a lot of money, and it would be kind of like putting a great, new, shiny coat of paint on an old jalopy that's riddled with rust and burning oil by the quart every time you drive it. That's what will happen if you create this office of livability. This administration, who has not seen fit to even send down one iota of policy for a transportation bill that was due last October--and they keep saying, oh, we're getting to it, we'll get you some ideas soon, we're working on it, it's a very high priority, the President is a really big infrastructure guy: well, where's the dough? Where's the policy? Nothing. Now, they do want to cherry-pick. They want this office of livability and then they can tout that through the next election and we'll never get a transportation bill. We can't let them cherry-pick. If they want to come down and talk about the comprehensive approach I've taken in my bill for livability, congestion management, new transit options, 21st century policy of transportation that takes into account livability, quality of life, economic development, congestion, reducing fuels, waste and all those things, let's have that conversation. But guess what, we're going to have to invest a little bit more money to do it. This administration is petrified. It's like all the options I've sent them, tax the oil industry, tax oil speculators, a whole bunch of things, they won't even begin the discussion, and if my colleague leads a successful fight against this amendment today, we will never have that discussion during the term of this President, never. So I've got to urge in the strongest words possible to my colleagues.

Mr. DeFAZIO

Mr. DeFAZIO. I thank the chairman. It's interesting to hear some Republicans on the other side of the aisle say this commission isn't necessary. We are going to run a $700 billion trade deficit this year. That means we will borrow, predominantly from China, Japan, and a few other countries, $700 billion to buy things that we used to make in America. And it's not a level playing field. We get played for a sucker in these trade deals. We need a new, strong trade policy. Yes, American workers can compete, but not on an unfair, tilted playing field, which is what they're being asked to do today. I will give a couple of examples. When we were doing MFN permanently for China, which I voted against because we lost that annual leverage with them, wheat guys from Oregon came in, and they said, Congressman, right now a ship is going into China. Imagine what it's going to mean for our markets. They're finally accepting our wheat. This new trade deal's going to be great. I said, Well, actually, I have got translated broadcasts of their agriculture minister that say that they're not going to allow that, and they're not going to become dependent upon imported food. They said, Oh, no, you are wrong. So, yeah, that one ship got in. Congress voted the deal, China was permanently off the hook to be reviewed for unfair trade practices by the Congress, and, guess what, that was the last ship. They came in the next year kind of hanging their heads and said, You were right. Are you going to say it? I said, No. I am going to say, what are we going to do now? And talked about fighting back against these unfair trade practices. We can look at just after the first President Bush signed the deal with Canada that was supposed to deal with their unfair subsidies and dumping of cheap lumber into the U.S. But before the ink was even dry on the deal, Canada reclassified much of their lumber to salvage. They basically started giving away their trees on the stump instead of making companies buy them and provided subsidized transportation and other things and again flooded the U.S. market. We're still fighting with the Canadians 17 years later over their subsidized lumber, and we've still lost thousands of jobs. Yeah, there was a little bit of cheaper lumber available here; but when you lose the jobs for working-class Americans, middle class American families, our consumers, when they lose their jobs, it doesn't matter if a house is maybe $300 or $400 cheaper. They can't afford the house. So we need a level playing field. We need to identify these barriers that are being put up by the Chinese and others. The Chinese are going to run more than a quarter of a trillion dollar trade surplus with the U.S. this year. They recently passed a law saying they're going to have a huge renewable program in China. And the law says that nobody can buy a renewable windmill or photovoltaic or anything else if it wasn't manufactured in China by a Chinese company.

Mr. DeFAZIO. I thank the gentleman. So the Chinese have passed a law saying that no one in China can buy a U.S.-made windmill or photovoltaic. If we get these green jobs and green industry going that the President wants, the Chinese aren't going to buy them. But guess what? The so-called stimulus bill that passed this Congress, part of those funds, our taxpayer dollars, money we borrowed in part from China to finance that bill, were used to buy windmills made in China. They can get their windmills in here like that. There's a company proposing to assemble photovoltaics in my hometown of Eugene, Oregon. But I also have people in Oregon trying to keep their companies going with made in America photovoltaics. But they are having trouble competing with the subsidized cheap junk from China because their photovoltaics are not very good. Again, we can't send our ours there, but they can send theirs here without any constraints. I remember back to Lee Iacocca, back when we used to sort of laugh at the Japanese cars. And when he had minivans and the Japanese started producing minivans, he said, You know, I produce a minivan for $16,000. I send it to Japan, it sits on the dock for 6 months while a series of inspectors come down and look at it. And then finally when it gets to the showroom, it costs $30,000 and it's been there 6 months. He said the Japanese take their minivan, it costs $17,000 to make it--they were less efficient then--he said they put it on a ship, it gets to Portland, they roll it off, it's in the showroom the next day. Do we ever reciprocate? We say, okay, if you are going to keep our cars on your docks for 6 months, how about we're going to keep your cars on our docks for 6 months? And that's what the trade commission will point to. It will point to the unfair trade barriers, these whole series of different phytosanitary, or actually safety inspections, or currency manipulation, all of the things that China and other countries are doing to steal our jobs and kill off our industries. This commission can point to those things, they can emphasize them, and they can propose ways that we can deal with it more meaningfully in trade agreements in the future. I recommend to my colleagues, help end the trade deficit. Vote for this legislation.

Mr. DeFAZIO

Mr. DeFAZIO. Well, big surprise--last Friday, the Obama administration went after the greed and excess on Wall Street during the financial meltdown. They went after it in the form of their esteemed pay czar, Kenneth Feinberg. He got out a feather duster and he waived it vaguely in the direction of Wall Street saying, shame, shame on you. He identified 17 mega-firms on Wall Street who paid out $1.7 billion in bonuses and other emoluments to their executives while they were lining up at the same time with their hands out to take tens of billions of dollars of TARP bailout money to save their firms from the risky bets they had made that were endangering their future that had gone bad. Now, he described some of these bonuses and payouts as ``ill- advised,'' ``poor judgment,'' ``lacking clear justification,'' but Mr. Feinberg, the all-powerful pay czar who talked so tough at the beginning, won't try and recoup the money. He says, ``It's not contrary to the public interest.'' Shaming, shaming will be penalty enough. But he won't name anybody who got the money. Can you imagine the guys at their really exclusive club or their private resort somewhere smoking their $500 cigars, drinking their expensive cognac, feeling really shamed when he won't even name the people who should be shamed? They don't even know they should be shamed. They got $10 million, they thought it was justified; they don't think he's talking about them. Now he said, At what point are you piling onto poor old Wall Street, going beyond what is warranted? Not in the public interest, piling on. Just think about it. Some of these executives who drove their firms to the edge of collapse and bankruptcy and tanked the U.S. economy and put 8 million people out of work got $10 million. Now that $10 million little bonus, that's about 250 years pay for an Army captain in Afghanistan, 250 years for an Army captain, one day in the life of a failed Wall Street executive, and Mr. Feinberg says, ``They should be ashamed.'' He went on to say, well, if he had gone after them, it could have exposed them and their firms to lawsuits from shareholders. Now, wait a minute, public interest, isn't that the public part of the corporation, the shareholders? But Mr. Feinberg apparently doesn't care much about the shareholders. This is about the executives, because those poor executives in those firms, why, their shareholders might try and recapture some of the misbegotten gains that these people got. Now, this all could happen because the original Bush-Paulson bailout didn't put any restrictions on executive pay and bonuses. Hundreds of billions of dollars to bail out Wall Street taken from the taxpayers, no restrictions on executive pay and bonuses; $1.7 billion paid out, ill-advised, poor judgment, lacking clear justification, they should be ashamed. But the pay czar isn't going to try and get it back. There is one thing very consistent about this administration: Nothing is too good for Wall Street.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I was in my office and heard this debate, which was sort of a departure from reality on the Republican side of the aisle. They say we should blame the victims of the Wall Street-led crash in America. These people are lazy; they don't want to work. Why, if we just cut off their unemployment benefits, maybe they will go out and find a job. The jobs don't exist. They were destroyed by greed on Wall Street, by the reckless Republican policies of deregulation at any cost, of tax cuts for the wealthiest among us because trickle down would help the working people of America and put them back to work. Craziness. I have 60,000 Oregonians, a State with over 10 percent unemployment, hard hit who will benefit from this bill. Now, they would say that's a special interest or an earmark to help 60,000 Oregonians who have exhausted their unemployment benefits. Let me just talk about one who I met in the unemployment office. Shame on you on that side of the aisle. Shame on you. Announcement By the Speaker Pro Tempore

Mr. DeFAZIO. Shame on those who would not extend unemployment benefits, whoever they might be--I think they're on that side of the aisle. Now, this gentleman, hardworking construction worker, older guy, fifties, 30 years never been unemployed, 30 years. He lost his job. Kind of a tough market for an older construction worker. He was in the unemployment office, initially pretty hostile; and afterwards he came over and he apologized and he said, I know you're not responsible for this. I know it was the Bush administration, and their policies put us in this mess, but I'm desperate, I'm desperate because my wife is really sick. And I can get extended health care benefits under COBRA for 900 bucks a month because I had a pretty good plan, but my unemployment is only about 1,200 bucks a month--Easy Street, the Republicans talk about, these people are living on Easy Street with $1,200 a month. $900 a month for health insurance for a desperately ill wife. How does he pay the mortgage? How does he feed the kids? Now, come on, let's get real here. You don't want to pay for tax cuts for the wealthy. You didn't pay for a $1 trillion war in Iraq that we didn't need, but now we've got to pay for the emergency unemployment benefits. Humbug.

Mr. DeFAZIO

Mr. DeFAZIO. Well, trickle down economics is back. It worked so well before. We just heard the minority leader: Tax cuts will solve everything. Tax cuts targeted toward the wealthiest among us, the super rich, will have a trickle down effect that will put people back to work and lower the deficit. That's kind of magic, isn't it? The Republicans forget that one-half of the so-called stimulus, nearly one-half, was tax cuts. Didn't put anybody back to work. Most people don't know they got them. Eight bucks a week out of your lower withholding. And guess what? We borrowed all that money. It will be paid back for 30 years. Now they want to borrow more. There's two sides to solving the deficit problem in this country. Cut unnecessary spending and, yes, the wealthiest among us are going to have to pay a little bit of their fair share by repealing the Bush tax cuts on those folks. They want to deny that. They want to say, oh, we can have the cake and eat it too. We'll lower revenues and we'll balance the budget. Now, if you eliminated the entire Federal Government, except for about 60 percent of the Pentagon, no justice, no prisons, no border patrol, nothing, you still wouldn't get to balance. You have to deal with revenue.

Mr. DeFAZIO

Mr. DeFAZIO. Press reports today show that our trade deficit with China has jumped to $22.3 billion dollars--in 1 month. Now President Obama wants to double down on Afghanistan with a counterterrorism strategy for $30 billion that many of us believe won't work. But that's because he's a war-fighting President. This is a war with China, it's a trade war, and we have surrendered to China. Secretary Geithner pretends they aren't manipulating their currency. Our Special Trade Representative pretends they aren't precluding American products with unfair trade barriers. We never file complaints against their unfair trade barriers precluding our products from getting into their country. We are losing the trade war with China. We're losing our national manufacturing base. We need those jobs. We can't keep borrowing money from China to buy things that we used to make in America. That's not a sustainable system. Wake up downtown at the White House, please.

Mr. DeFAZIO

Mr. DeFAZIO. Madam Speaker, the President has today been given a unique opportunity with the firing of General McChrystal. General McChrys- tal was the principal author and advocate of the surge of U.S. forces in Afghanistan. His theory was that it would be a clear hold and transfer--that is, a transfer to the Afghan police, who do not exist, to the Afghan security forces, which are in a state of disarray, and to the Afghan Government, which does not exist meaningfully outside of the capital. He tested his theory in Marjeh this spring. The U.S. and allied forces performed admirably, with tremendous sacrifice and effort. They did, in fact, go into a very hostile area, and they did, in fact, at least temporarily, drive the Taliban and other dissident elements out or underground. Then he said he was going to bring in government in a box, that it was ready to come in. Now, there wasn't, unfortunately, any government in a box. There is unbelievable corruption rife through the Karzai regime at the national level, through the police and through the security forces. They brought in some police who were not of the area, not of that tribe, and that didn't work out too well. They brought in security forces who refused to do their mission, and they brought in a few, again, government officials who had no local support. They have since left, and pretty much, Marjeh has devolved to what it was. Even before he was fired, General McChrystal admitted that this was going to take a lot longer and was going to be a lot harder than he thought, which means President Obama's dictate of beginning the withdrawal next year is a fantasy. That was part of the criticism that General McChrystal and his allies at the Pentagon put forward. So there is really a choice here--to get into a very long-term, a very high-level engagement in Afghanistan at a cost of $30 billion a year and with tremendous sacrifice by our troops on a strategy that has, thus far, not worked or to rethink that strategy, perhaps more along the lines of Vice President Biden's ideas, which were also derided by General McChrystal and by some of his colleagues. Actually, what Vice President Biden said was, look, mostly this is an internal issue. It's an inter- and intratribal fight. Yes, there are some radical Taliban elements, and there are some radical Pakistani Taliban elements and very few al Qaeda. How about we guarantee that we will take care of any intervening forces--that is, terrorist forces--coming in from outside, in any number, with a smaller troop presence and with our technology? How about we let the Afghans work out their intertribal/intratribal conflicts that they have been carrying on about for 600 years, and we encourage them to do that and to adopt policies to help them meaningfully rebuild their country? Instead, General McChrystal won the day, but now he is gone. Now, I understand that the President has said this does not mean a change in policy. I think that he should step back from that remark and should consult again with all of his best security advisers and with the Vice President, and he should look at the results so far and find out what those critical comments were which were mentioned in that article where, basically, the Pentagon is saying, hey, this is going to be years and years and a much bigger force, and maybe there will have to be a second surge into Afghanistan. Starting to sound like Vietnam to anybody here? With huge amounts of money, we prop up a government that has no relationship to the rest of the country. They have huge corruption. They don't have support in the countryside. That government falls, and another one comes in and another one. This echoes that failure. So, in the strongest terms possible, I would urge the President to reconsider, to reconvene his advisers now that General McChrystal is gone, and to think very carefully about a much less expensive, much less troop-intensive strategy to bring about a better result in Afghanistan.

Mr. DeFAZIO

Mr. DeFAZIO. Today, the House will finally turn from naming sports teams' accomplishments to the Pentagon budget, a budget that's top heavy with more generals and admirals than we had at the height of World War II, a broken procurement system that's gold-plating dysfunctional weapon systems while our troops lack basics. But, today, Congress will finally answer a question that is a puzzle perhaps only inside the Washington, DC beltway: How many engines does a single-engine jet fighter need? Now, where I come from it's pretty simple, the answer is one; but you've got to tune in later today to find out the judgment of Congress because some think you need two engines for a single-engine jet fighter. Hey, it will only cost another $15 billion or $20 billion.

Mr. DeFAZIO

Mr. DeFAZIO. Well, compared to the enormous wealth that he created by shorting and manipulating and synthesizing. You know, the one thing I would reflect on, I was a little puzzled yesterday when I kept hearing him say, We are the market makers. We are the market makers. After awhile I started thinking about book makers, market makers, is there a difference. What is the difference when they are not dealing in reality or productive investment, they are dealing in manipulated investments, products that are designed to fail. I mean, we have too-big-to-fail institutions that create products that are designed to fail, and they profit immensely by doing that. What's that about market making?

Mr. DeFAZIO. Last year it was rather modest for Mr. Blankfein, he only got a $9 million bonus which was considerably less than previous, but that does figure out to $1,000 an hour, 24 hours a day, 7 days a week, 365 days a year. Most Americans would be happy to have that salary for a fraction of a week.

Mr. DeFAZIO. Thank you for yielding. I think the American people are a bit confused as to what is really going on here. And, you know, it's a lot like the Humphrey Bogart movie: What's going on here is gambling, plain and simple. It would be one thing if these so-called investment banks like Goldman Sachs were lending into the productive sector of the U.S. economy, if they were lending to people who had good ideas to produce products and goods, employ Americans and help us compete in the world economy. But they are not doing that. In this case, they weren't even helping to package and move mortgages off of people's portfolios and someplace else. They were merely mimicking with what are called synthetic collateralized debt obligations, packages of bad or potentially bad mortgages to bet on, for this one hedge fund to bet against and make a billion dollars. But then, of course, unfortunately, other parts of Goldman Sachs, apparently unbeknownst to them, I mean, in totally good faith, went to clients of Goldman Sachs and said, Hey, we've got a good product here we'd like to sell you. Unfortunately, other parts of Goldman Sachs had assembled this product with the intention that it would fail, and these other people were not informed of that fact and purchasing them, although Goldman would say they didn't have an obligation to tell people that they had designed it to fail, working with someone who was betting it to fail, and that Goldman itself was betting on it to fail. But the bottom line of all is it's a huge amount of churning on things that don't help the economy, help the American people, help us compete in the world. Goldman has gone to the point in 2007, their gambling income--excuse me--their financial services, investment, self-proprietary, et cetera stuff, whatever you want to call it, was actually five times larger than their investment banking activities. So 20 cents of every dollar at Goldman was going into productive investment. The other 80 cents was going into gambling on imaginary products. It's a lot like fantasy football. A lot of Americans can understand that. Imagine if they took out and created synthetic products that related to fantasy football. Maybe some Americans can understand that. Recently, one firm actually proposed, a Cantor Fitzgerald subsidiary, proposed to do futures on movies. In L.A. they would produce a movie and then the people on Wall Street would bet on what the opening weekend was going to return, and they would bet on how much money it might make. This became of such concern to producers in L.A. because they thought, My God, if they start out shorting us right away, that's going to depress our investment potential for the movie, et cetera, et cetera. So in the Senate bill they're actually banning this sort of derivative. So they have banned two kinds of derivatives. One has been historically banned for some reason lost in the mist of time. Onions, you can't do them on onions. And the second would be movies from Hollywood. Otherwise, you can bet on anything. You can bet on the weather tomorrow as a derivative product. You can market it on Wall Street, et cetera, et cetera. This is not a productive activity. I would suggest a simple way to deal with it. One thing that's good is the Senate has actually, for once, proposed something useful, which is to say that if Goldman wants to have a proprietary trading section and trade in these gambling products, that they couldn't be insured by the FDIC or draw money through special windows at the Treasury. We should not subsidize their addiction to gambling. The taxpayers should not subsidize it. That would be a good step. But the other thing we could do would be to put a very modest tax on this gambling and to say, Look, for legitimate hedgers, airlines who want to hedge against fuel price increases, farmers who are worried about failure of the corn crop, those people. We already distinguish between hedgers and speculators over at the Commodity Futures Trading Commission. Let's just say hedgers would be exempt from the tax. But speculators, those who have no skin in the game, aren't producers, or even worse, are not even actually involved in any way as a counterparty but just merely creating synthetic things to bet for or against, they would pay a very modest tax. If the tax was approximately two-tenths of 1 percent--that's .0002--on each of these, we could raise somewhere between $30 billion to $50 billion a year to help pay for some of the damage they have caused to our economy. It might not raise that much because it might rein in some of this speculative activity, which I think would be a desirable impact; but I would suggest that would be one way to deal with this very, very reckless activity. I congratulate the gentlelady for having this hour to highlight these concerns and the contradictions that we see in the business principles versus what we all saw going on. With that, I'd yield back.

Mr. DeFAZIO

Mr. DeFAZIO. Well, as I speak here on the floor of the House, the Republicans on the Senate side of the Hill are still blocking meaningful financial reform, protecting their patrons on Wall Street as they always do, and the lords of Goldman Sachs are before a committee protesting their innocence. Now, we all know that Goldman and these other firms on Wall Street were too big to fail, or at least some think they were--I think we should have let a few more of them fail, personally, and I opposed the bailout of Wall Street. But let's just say they were too big to fail or at least they were deemed too big to fail and they were bailed out by the United States Government and the taxpayers of the United States, but something else was going on at the same time. Not only were they too big to fail, they had created wonderful, new financial products that were enriching them in unbelievable ways, making millions of dollars a day for the lords of Goldman and elsewhere on Wall Street. They had designed products that were designed to fail. Then they sold them after they went to the all-too-willing ratings firms, so-called ``impartial'' ratings firms. Goldman would pay Moody's to rate garbage as caviar, AAA. Then they would go out and sell it to sophisticated investors who should have known better. I mean, come on, they should have looked at it more carefully. I mean, well, yes, they did kind of mess around with it and they did get the people at Moody's by threatening to take away their business, to rate the garbage as caviar, but those other people should have smelled it and known really it was garbage. And, I mean, what's wrong with that? And then of course, Goldman just did happen to place some bets of its own against the garbage--which they had created and knew was garbage, and they bet it was garbage--and they won, making billions of dollars for themselves and others who were in on the know here. This is a pretty rotten system. Now, you could say, well, gee, but aren't they doing things like investing in capital? Aren't they building a great America? No. The financial services industry has gone from 19 percent of the profits in this country to 41 percent, and for the most part--outside of community banks and some people who still actually do banking, unlike most of those companies on Wall Street--they produced no value. They created a heck of a lot of wealth for themselves and others, and occasionally they caused the economy to explode and cost us millions of jobs. But they're still doing very well for themselves and now they're back to business as usual. And the Republicans in the Senate are defending ``business as usual'' under the guise of wanting to have a better bill that won't encourage bailouts. I mean, this is all such a laughable farce. It would be funny except for the unbelievable pain it has caused to the real economy of this country who have been suffering for years. It's time to cut these people down to size, cut them down to size by prosecuting them. I have been joined by 59 of my colleagues, and Elijah Cummings and I have sent a letter to the SEC saying, look, you've uncovered one case of alleged fraud by the Securities and Exchange Commission where they knowingly sold a bad product to investors and then they bet against it themselves. There were a number of others that went through something called AIG, which the Federal Government also bailed out at the cost of $180 billion to taxpayers. We want every transaction between Goldman and AIG scrutinized to see whether or not any of those were similarly fraudulent transactions, in which case we could get a few billion dollars back from the lords of finance to the taxpayers on Main Street, USA. It is long past time to begin these kinds of investigations and hopefully, ultimately--like with Enron, because this is worse than Enron--prosecutions. And we will let some of them enjoy some Federal hospitality for a few years. This is absolutely outrageous. They're creating products designed to fail, that have no useful product, in fact robbing capital from companies who want to invest, who actually want to make things, who actually would employ Americans and who would enhance our economy, all for them to gamble on Wall Street. It's time for the gambling to stop. You know, in a regular casino, if the casino goes broke, it's only the gamblers and the casino that have a problem. In the casino of Wall Street, when they mess up, they destroy the real economy of the United States and people's livelihoods. It's time to cut them down to size.

Mr. DeFAZIO

Mr. DeFAZIO. Well, you've got to give it to my friends on the Republican side of the aisle. They are incredibly consistent. They have sided with the big pharmaceutical industry and the insurance industry. Sadly, they lost that debate, but they want to revisit it with the changes we made in health care and some of the outrageous health insurance practices we outlawed, like preexisting condition exclusions, rescissions of your policy when you get sick, and nonrenewal when you get sick. But they're also fighting to change the subject here, because they're also trying to stop the reform on Wall Street. Their biggest patrons are the pharmaceutical industry, the insurance industry, and Wall Street. And they just want to protect the status quo for those folks. Over on the other side of the Hill, the Republicans in the Senate are blocking financial reform--reform of Wall Street, doing away with the abuses that crashed our economy and put millions out of work. And every single House Republican voted against reforming Wall Street here on the floor of the House. Well, two were absent but all those who voted, voted against it. Now they want to change the subject back to health care, except they lost that debate, too.