Barney Frank

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Thank you. Yes, I think it is unfortunate. Of course our cuts are much smaller by multiples than the cuts inflicted by the subcommittee majority.

Mr. FRANK of Massachusetts. I spoke to the people at the subcommittee who worked at them and I think the cuts are too deep.

Mr. FRANK of Massachusetts. I apologize. I thought the gentleman wanted an answer.

Mr. FRANK of Massachusetts. I thank the gentleman. The gentleman from New Jersey asked me a question. I foolishly thought he wanted an answer, and I apologize for my false assumption. The answer is that I know that the proposals we have made to reduce at the GSA and the IRS go too far. I will point out again that they are a small percentage of the very deep reductions made by the subcommittee. The problem we had is under the very restrictive rules, we had to choose among certain agencies. My hope is that the House will demonstrate its support for increased funding for the SEC and when it gets to the Senate, they will have more flexibility and can take it from elsewhere. And we will see fiscal discipline imposed in some other places. I did not call those agencies because I knew what their answer was. I knew it from the ranking member of the subcommittee, that the chairwoman in my judgment of the subcommittee had already cut them too deeply. We had no options. What we are doing here is simply trying to make the point that the SEC should be funded. I want to now respond to the notion that we always think it's more money. No. We have talked also about reforms. And, by the way, they talked about 2004. They talked about 2008. A prior administration. I believe that there has been a real change in this administration in the seriousness of the appointments to the SEC, in the understanding of what they should do. There is a new SEC director of enforcement, Mr. Khuzami. By the way, disciplinary proceedings, the new chair, Mary Schapiro, has announced are now under way over the people who didn't do what they should have done in the Madoff, which of course is from prior years. So, yes, the SEC has been less than perfect, but it has a very new set of responsibilities. And the notion that they can deal with that new set of responsibilities with less money than they had last year comes only from people who are not in favor of the new responsibility. I understand that. But becoming more efficient doesn't allow you to get into monitoring all the hedge funds that have to register and to monitoring derivatives. What we have here is an ideological opposition to reform of the financial system, a preference for keeping the shadow banking system in the shadows, masking as a fiscal argument. Because we can do this in a deficit neutral way and the SEC will continue to be a profit center. So this notion that we think the answer is always more money, no, we don't. And if the majority has some improvements to make to the SEC, let's see them. I don't remember any being offered by them as amendments when we were doing the financial reform bill. We have worked with Mary Schapiro. We do believe she's making significant improvements in a lot of ways. But the notion that you can give them significant new responsibilities and give them less money than they had in the year before when they're supposed to now be looking into derivatives and hedge funds makes no sense. The gentlewoman from Missouri acknowledged she had misspoken when she said we had cut it by $600 million. She cut it by $600 million. I wish she hadn't done that. I wish they hadn't done other things. Within those constraints, what we are trying to do is to send a message that we believe the SEC should get some of the funding, not all that it asked for and not all that the administration asked for. What we have here is a test about whether or not people want to support the re-deregulation of the financial system, whether they want to keep the shadow banking system in the shadows. I believe the answer is that we shouldn't. I thank the gentleman from Pennsylvania.

Mr. FRANK of Massachusetts. I yield to the gentleman from Texas. Excuse me. Does this have anything to do with cement? If you mention cement, I'm not yielding.

Mr. FRANK of Massachusetts. I move to strike the requisite number of words.

Mr. FRANK of Massachusetts. Mr. Chairman, being of an optimistic nature, I look for silver linings. So I welcome the fact that my colleagues on the other side have decided to adopt gender-neutral language, because a lot of the czars would have been called czarinas in the old days. So I appreciate the fact that we've gotten beyond sex stereotyping of people. Also, I guess they were in a little bit of a hurry. The gentlewoman from Missouri has spoken, the gentleman from Louisiana, and they listed the czars they didn't like. They overlooked one. Maybe it was hard to read. Here's one of the ones they want to eliminate. By the way, you notice that many of the ones they want to eliminate have already been eliminated. They're not there. So they are denying funding for nonexistent positions--climate change, healthcare.

Mr. FRANK of Massachusetts. I yield to the gentlewoman from Missouri.

Mr. FRANK of Massachusetts. Then I yield. Because where I come from, cement was not good news for the people who were put into it. I yield to the gentleman.

Mr. FRANK of Massachusetts. Then rather than deal with it this way, I would have thought in the CR, you're telling me that the Republican Appropriations Committee majority funded some nonexistent positions. I would have some advice, Mr. Chairman, for the gentlewoman. Next time, don't do that and we won't have this problem. But there are some positions that they did fund that they would defund that still exist. And I understand they were in a hurry; so they forgot to mention all of them. They talked about climate change and they talked about health care. Here's the one they forgot to mention: The special master for TARP Executive Compensation, Department of the Treasury, that is the special master, whose job it is to monitor excessive compensation of those TARP recipients who got special assistance and still owe the Federal Government money. So what they want to do is knock out the person whose job it is to monitor compensation at AIG and at General Motors and at Chrysler and at Ally.

Mr. FRANK of Massachusetts. I yield to the gentlewoman from Missouri.

Mr. FRANK of Massachusetts. I have an amendment which says special master for TARP Executive Compensation, Department of the Treasury. So the amendment I have defunds and says you can't pay--I want to make it clear. This is the amendment offered by the gentleman from Louisiana. The one I got says, lines 18 and 19, Special Master for TARP Executive Compensation, Department of the Treasury. Is the gentlewoman telling me I was given a defective copy? I yield to the gentlewoman.

Mr. FRANK of Massachusetts. I reclaim my time. Parliamentary Inquiry

Mr. FRANK of Massachusetts. I have a parliamentary inquiry, Mr. Chairman.

Mr. FRANK of Massachusetts. What's the text of the amendment? This is the one we were given. Could I get a reading of the text of the amendment, or could I get a copy of the amendment?

Mr. FRANK of Massachusetts. Well, then reclaiming my time, and I ask unanimous consent that special debate time be allotted so the gentleman from Texas can debate the gentlewoman from Missouri because they seem to be undecided between them about it. So the question I have is, this amendment, as it was presented, says you can't pay the person whose job it is to stop excessive compensation at TARP recipients. Now, the gentlewoman from Missouri says it's not in there, that I've got a bad copy. Okay, so it is in here. So this amendment would say to AIG and General Motors and Chrysler and Ally, the financial company, no one will now be supervising what you do. And even though you haven't yet paid back the Federal Government, there will be no enforcement of restrictions on your bonuses, no enforcement of restrictions on your compensation. I should note, by the way, in the condemnation of these czar positions, one of the ones that's now vacant that they'd bravely get rid of is the senior advisor on the auto industry. That's one of the great successes of the Bush-Obama administration and transition. I would tell the gentlewoman that she should work it out with the gentleman from Texas and then come up with a joint answer. But I want to make my other point. One of the czars they are complaining about presided over a Bush- Obama transition policy that kept General Motors and Chrysler alive. We have auto industries flourishing in America and suppliers today. That was partly because of this position that's now vacant that they want to get rid of retroactively. Please explain to me what it means when you say you were going to deny the funds for the special master for TARP. I will yield to whoever wants me to yield. The gentleman from Kentucky. The gentlewoman from Missouri.

Mr. FRANK of Massachusetts. I yield to the gentlewoman from Missouri.

Mr. FRANK of Massachusetts. Reclaiming my time, so now the third answer I get is, yes, they do get rid of the special master. There's an office there with nobody heading it.

Mr. FRANK of Massachusetts. I would ask for an additional 2 minutes, having yielded so much of my time.

Mr. FRANK of Massachusetts. Well, I just asked for 2 minutes, having yielded so much of my time.

Mr. FRANK of Massachusetts. Well, I will leave to the gentleman to work out his Lenin fantasy, but I want to reiterate what this amendment now does. There is a special master, a high visibility individual whose job it is to prevent excessive compensation from those TARP recipients that are still out there: AIG, General Motors and Chrysler and Ally. This amendment strikes it. This amendment leaves us without a person of great responsibility, and I think that--and, by the way, it's only the top hundred employees, and there are two levels, 25 and 75. I cannot understand why Members would want to send this signal, because many of these positions are already vacant, that one of the positions that is not vacant is our effort to put limits on compensation bonuses and other excessive compensation for those entities that still owe the Federal Government money. And why our colleagues decide that that position should be abolished and a high- level individual charged with that responsibility should not be there is baffling to me. I cannot believe that that's what people think the American people want; namely, a restriction on the restriction, a relaxation on the restriction of bonuses and other compensation paid to large recipients who have not yet paid back their TARP money. And I thank the gentleman from Kentucky for his consideration.

Mr. FRANK of Massachusetts. Will the gentlewoman yield?

Mr. FRANK of Massachusetts. I thank the gentlewoman for yielding. I want to stress again, I have not heard a defense of the proposal that we remove from the Federal Government the highest profile individual charged with controlling compensation excesses at four companies which continue to be the recipients of special assistance. I do not understand this desire to free AIG from restrictions and General Motors and Chrysler. They have been successful, and I'm glad, but they owe the Federal Government money. Allied, the financial company, owes the Federal Government money. I do not understand, you can go one by one and I haven't heard a defense of it. Why would we say that the individual most responsible for limiting excessive compensation to TARP recipients should no longer be able to work for the Federal Government and no one should be able to fill that position? I thank the gentlewoman.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. Mr. Speaker, reserving the right to object, I guess I am a dissenter in this orgy of self-congratulation, and I want to explain why. And I may not object if I have a chance to explain why, but if I can't explain, I have to object. So that is the choice. I either explain or object. I object not to the UC at this point, but to the self-congratulation that the majority is engaging in because they said they had such an ``open process.'' In fact, the refutation of that was best stated by the gentleman from Kentucky. He just said we have debated the whole government. Yes, we have--and very inappropriately. To debate the whole government and to debate fundamental policy issues under the guise of a budget, under the constraints of a budget debate and not three, not a whole week, 2\1/2\ days so far. Maybe we will get a third day. We have dealt with the most fundamental questions. In the jurisdiction of the committee on which I serve, issues came up under great constraint. The reform bill of last year has been damaged by what was done here. Fortunately, it will never become law. And we were constrained because we had to choose between the SEC and the IRS. That is not the way to legislate. This was not an open process. Yes, you could offer amendments. You could offer amendments in a very narrow compass. You could offer amendments according to the jurisdiction of subcommittees. The jurisdiction of subcommittees is somewhat accidental. It doesn't determine public policy. And, yes, we are talking about it now. We are boasting about debating the whole government. Did my colleagues listen to the UC? You will get to debate whole aspects of the government tomorrow for 10 minutes. We are the model of democracy. The next thing you know, they will be rioting in parts of the world so they can have 10 minutes per issue to debate fundamental issues. This is a travesty. I very much objected to this procedure. My leadership, for which I have great respect, had asked me if they could go forward. I am prepared to allow that because of some conditions. One is that I am confident that this awful, distorted, ill-thought-out process has produced a bill that will never see the light of day. And by the way, no one should be surprised. We are now going to recess after we finish with all of these other parts of the government in 10 minutes per issue, or up to an hour for a couple of important ones, 20 minutes for some only moderately important ones. The Senate will then get this with 4 days left before it expires. No one realistically thinks this is going to happen. So perhaps some of the constituencies were mollified by this show; but I want to stress again, this has been awful procedure. The gentleman from Kentucky is right: we have debated the whole government, fundamental issues that go far beyond budgetary issues in 3\1/2\ days. We will have debated fundamental issues in 10 minutes. This is openness? This is a travesty of the democratic process. So, Mr. Speaker, because I have been given a chance to explain why I think this is a terrible process, why I am going to say now I don't expect the Senate to accept this. We will have to come back and do it again. There will have to be, I assume, a short-term extension. I want to give notice now to all parties, I will object strenuously at every procedural opportunity to any effort to repeat this travesty. So with respect to the ranking member and to the minority whip and the minority leader and to others and to people who have worked so hard and to the poor long-suffering staff, yes, I will remove my reservation, and I will not object. Having made it clear, once the Senate gives this awful product an appropriate burial, I will not be a party to its resuscitation. Mr. Speaker, I withdraw my reservation of objection.

Mr. FRANK of Massachusetts

Mr. FRANK of Massachusetts. I thank the gentleman from Virginia for giving me the chance to go early. I particularly want to speak now because when we voted the second time on the Patriot Act, the first time I did vote against the extension, but the second time I missed the vote--my fault--but I want to make clear my opposition not to an extension of the basis of self-defense that we have here but of passing it unchanged and of failure of the legislative process. We knew this date was coming. To extend this now--and the gentleman from Texas laments the fact that we were unable to do it indefinitely without a chance to amend it. When the bill came up twice before, there was in neither case a chance to offer amendments. There isn't today; twice on suspension, once in a closed rule. To be presented with either/or on this is a bad idea. There are things that could be improved. There are areas where there are excesses. We have gone through a lot of symbolic activity in the legislative process this year--the vote to repeal the health care bill, a vote reaffirming that we would do oversight, which we have been doing and which is our duty--time that could have been spent in committee, working on a process, offering people a chance to amend so we could-- would not, for the third time, be confronted by the majority with up- or-down, an unchanged Patriot Act. Of course we are supportive of continuing our ability to defend ourselves but not without some refinement, not without some look and say, yes, there are ways we could do this that are more respectful of the liberties of the average American but would not endanger in any way our national security. For the third time, we are being denied a chance to do this; and I, therefore, will join my colleagues in opposing this, not because we don't want to see any extension at all but because we want a chance to work on it so we can do an extension of much of this act but with some improvements.