Scott Garrett

Mr. GARRETT

Mr. GARRETT. I thank the chairman for yielding. Mr. Speaker, let's step back for a moment and just see where we may agree on certain points. I guess at the 30,000-foot level we agree on the fact that we want to work together on legislation that will try to prevent the next financial crisis. We agree that we want to try to protect investors. It is after that level, however, when we get into the details that we disagree. As far as protecting and trying to make sure the next financial crisis does not occur, there has been no evidence either today on the floor or in the committee process during the discussion of this debate or in any of the debates when we discussed Dodd-Frank that the origin of the last financial crisis was from private equity. No evidence. Or from hedge funds. No evidence. Or from venture capital. No evidence whatever. So to say that we need to have extensive, overbearing, overlapping, extraneous regulation on private equity to prevent the next one, they have no evidence to say that was the cause in the past. We say, just as the gentleman from Connecticut said before, venture capital is excluded from it. Why not private equity as well? And that is why we have come together in a bipartisan manner to make sure the next crisis doesn't occur in an area such as this. In the second area, the point was made as far as the cost. The gentleman from Massachusetts said, Well, we're talking about the larger funds here. If he was at the hearing last night in the Rules Committee, he would have heard one of his colleagues, Mr. Polis from Colorado, refute that point. Why is that? This is what he said. When you are talking about firms, $150 million, $200 million sounds like large firms, right? But that is just how much money is under management. The actual money they are actually spending in the company is just a fraction of it. A little tiny fraction, as he pointed out. It is around 2 percent. So if you are talking about a $150 million fund under management, it sounds big. Actually, that is around a $3 million business. And now you are asking that $3 million business to have to pay upwards of half a million dollars each year for all their compliance costs and the examination, which goes to the last point by the gentlelady from New York.

Mr. GARRETT. We would love to try to find some common ground on her amendment, but her amendment simply goes to the first point and the initial filing of the forms and what have you. After that, there is the extraneous additional examinations and all the other costs that are so overly burdensome that we have found both in a bipartisan manner, as Mr. Himes from Connecticut has already pointed out, is overly burdensome and unnecessary. If there was some other way to pull this together in a bipartisan manner more so than we have already done, I would do so, but I am glad that the gentleman from Virginia and also the gentleman from Connecticut have been able to come together on all the points to come to a final bill in a bipartisan manner. And I support the legislation.

Mr. GARRETT

Mr. GARRETT. Madam Chair, on rollcall No. 605 I was detained chairing a Financial Services Subcommittee hearing. Had I been present, I would have voted ``no.'' Amendment No. 2 Offered by Ms. Castor of Florida

Mr. GARRETT. Madam Chair, on rollcall No. 606, I was detained chairing a Financial Services subcommittee hearing. Had I been present, I would have voted, ``no.'' Amendment No. 3 Offered by Ms. Speier

Mr. GARRETT. Madam Chair, on rollcall No. 607 I was detained chairing a Financial Services subcommittee hearing. Had I been present, I would have voted ``no.'' Amendment No. 4 Offered by Ms. Jackson Lee

Mr. GARRETT

Mr. GARRETT. Mr. Speaker, President Obama purports to protect and defend the idea of open government, but his staff seems to have missed the memo. You see, just 5 months ago, I asked Treasury Secretary Jack Lew about his personal knowledge of the IRS' reprehensible practice of targeting innocent Americans. I inquired of him three basic things, one of which was what was the Secretary's knowledge and what was his involvement with any of the various meetings with then-IRS Commissioner Doug Shulman and the White House. You see, back then a year ago, Jack Lew served as the chief of staff to the President while some of the most egregious, reprehensible behavior ever displayed by the IRS took place while Doug Shulman was the IRS Commissioner and while Doug Shulman reportedly attended meetings at the White House at various times. Unfortunately, rather than answer some of these basic and simple questions and putting to bed any and all appearance of impropriety by Jack Lew, Secretary Lew continues to ignore all of my questions. The American people have the right to know. The American people have the right to know exactly what Secretary Lew knew and what he did. So I rise today to ask the American people to join with me and demand openness from this government, from this President, and from Secretary Jack Lew. Secretary Lew, it is time to answer the questions of the American public.

Mr. GARRETT

Mr. GARRETT. I thank the chairman. I think the compromise language we are considering today strikes the right balance, and I urge my colleagues to support that approach, and I thank the Members for working together to help us to get to this point. Mr. Speaker, those are not my words. Those are the words of the ranking member last year when similar language and similar legislation was coming down and she supported this legislation. So I want to associate myself with her support of this legislation. And why did she do so? Well, because she also said, The provision that we are talking about was something in the bill with section 716 that said ``the House Members were able to consider less carefully than other sections of Dodd-Frank, since the provision didn't come through under regular order in our Chamber.'' In other words, she recognized the fact that this provision in the bill was added late in the dead of night and had never come through committee for consideration. She also realized, and I quote again, that ``legitimate concerns have been raised about whether pushing a significant portion of swaps out of banks is the best way to mitigate against future systemic risk.'' So, again, I wish to associate myself with those words of the ranking member who, in the past, has supported the very same legislation that we have here before us today. And why do she and I both support this legislation? Because it is good for Main Street. It is good for farmers. It is good for small ranchers. It is good for small businesses. She recognized then, as I do now, that what we need to do is to try to spur on our economy, make sure that there are not impediments, that we don't overly complicate things in the banking sector, in the financial sector and what have you--that would do what? That would put our country at a competitive disadvantage with other countries around the world and, by so doing, make it harder--yes, harder--for our farmers, ranchers, Main Street businesses, and the like to be able to get the credit they need and to pay their bills and what have you. So I concur with her that we need to pass this legislation today.

Mr. GARRETT

Mr. GARRETT. Mr. Speaker, I thank the chairman for advancing this bill to the floor. I also congratulate the sponsor of the bill, Mrs. Wagner, for leading forward with a piece of legislation that has, at its heart, to work in a bipartisan manner to protect American investors big and small, senior citizens, and regular people across this country who are concerned about their investment, concerned about what they pay for their advice and for their transactions. So I commend both of them for moving this legislation along. The other side of the aisle likes to get engaged with name-calling, like ``shoddy,'' ``bad,'' ``rip-off,'' and throw out numbers which, I guess, are just sort of pulled out of the air when they say, If it is 1 percent for this, how much over 30 years? If it is a commission of X, I don't know, how much is it over 40 years? I always wonder when I hear comments from the other side of the aisle if they really actually sit and read the bill or do they just pull these numbers out of a hat. But I did hear one of their comments which went to the point of trying to help investors, which is: How do we help Americans, and how do we do it in a bipartisan manner? Well, this was one of the most bipartisan bills that we have ever had coming out of our committee. Over half of the Democrats on the committee said they are going to stand with Americans, stand with investors. I will share some of those. Mr. Sherman voted ``yes''; Ms. Moore said ``yes,'' stand with Americans; Mr. Perlmutter said ``yes''; Mr. Himes said ``yes''; Mr. Peters said ``yes.'' Messrs. Carney, Foster, Kildee, Delaney, Mrs. Beatty, and Mr. Heck, to name just a few, joined with Republicans to work in a bipartisan manner to stand with Americans and stand with American investors, realizing that, at the end of the day, part of the problem in Washington is too many agencies that are not communicating with each other. Lack of communication is one of the problems that we have seen in this country in the last few weeks and months. All we are suggesting is that the various agencies, like the SEC and the Department of Labor, actually coordinate and work together for investors. How will they do that? Well, the SEC, is principally charged with the responsibility of looking at the areas of broker-dealers and investment advisers. And you know there is a difference on how they are treated right now, and there is a reason for that. They have been treated differently for eight decades, I guess, or so. The SEC will be looking at this. As the gentlelady from New York has indicated, there is a study outstanding right now. They are getting comments in already for that study. We are saying let's make sure we hear all the information, collect all the data, and before we go forward, let's have communication between these two agencies. Let the SEC take the first step here. Nothing in here prevents them from taking any final actions or final steps. Nothing in this bill prevents the investor from being protected as these various agencies see fit. All we are really asking for is the SEC, the agency principally charged with this, to take the first action, make sure they have the data, then work in harmony with the Department of Labor, and at the end of the day, we will be helping the American investors in a completely bipartisan manner.

Mr. GARRETT. Mr. Speaker, I thank the chairman for yielding me time. How you ended your comments was, Let's move this bipartisan amendment to this bill, and what I was trying to do in a bipartisan manner was to ask the question: Is simply what you are trying to do is to require that investment advisers, that they would have to have, you are saying, a fiduciary duty going forward? That is what you are trying to do to add to this bill? I heard you say that, and I heard Mr. Miller say that. That was my question to you. You said it once. Mr. Miller said it twice. I made a note of it each time. That is my question. That is what you basically want us to do. You want us to make it the law that an investment adviser would have to have a fiduciary standard to do in the best interest, if you will?

Mr. GARRETT. I yield to the gentleman.

Mr. GARRETT. Earlier I said that I often wonder whether people who come to the floor to oppose some of our bills ever actually read the bill.

Mr. GARRETT. Now I am going to go a step further. I wonder whether the people who oppose this bill actually know what the law is. The law is and has been for decades that, if you are an investment adviser, you already have a fiduciary standard with regard to your client. That is the current law. Already the investment adviser, going through an ERISA plan, has a fiduciary standard. I think what you are talking about is a broker-dealer.

Mr. GARRETT. I yield to the gentleman.

Mr. GARRETT. Exactly. That is why I asked both of you twice what you said. What you said on the floor and what you just said a moment ago is, you were talking about broker-dealers, but you said it was investment advisers. It just points out, Mr. Speaker, that they come to the floor with absolutely no understanding of what the law is. Once again, we encourage the bill to go unamended.

Mr. GARRETT

Mr. GARRETT. Madam Speaker, pursuant to Senate Concurrent Resolution 24, 113th Congress, I move that the House do now adjourn.

Mr. GARRETT

Mr. GARRETT. Mr. Speaker, your privacy is under attack. The Affordable Care Act, ObamaCare, is creating a data hub for every American's personal health information and financial information. It's basically a central location for all of America, for all of your private and sensitive information. Can America really trust this system that has key information on your income, your Social Security numbers, your emails, your family size, your medical records, and the list goes on? The answer is ``no.'' With the ObamaCare data hub, an American's personal information will be shared from the Department of Justice, the Social Security Administration, the Department of Homeland Security. The IRS will send information, the Treasury Department, Health and Human Services. We have already witnessed many security breaches within numerous government agencies, and the potential for abuse here is staggering. We know a system like this will be attractive to identity thieves. It is clear that a system that has not been tested for security systems cannot adequately protect all of our security information and our personal information. We have even witnessed privacy abuses by other government agencies--by the NSA, by the IRS. The Obama data hub will end privacy as we know it and will grant unprecedented power over citizens to the government.

Mr. GARRETT

Mr. GARRETT. I thank the gentlelady. I guess I will be speaking for a minute or two on the issue of unworkability of what's before us right now. Mr. Speaker, I have to remind all of us here that for years now Republicans have come to this floor with one main point when it comes to health care: that it is our goal, it is our desire, it is our effort to make sure that Americans can have affordable health care coverage and health care delivery in this country. To that end--I'm not going to go into all the details now--in this House, Republicans have offered numerous pieces of legislation that would help facilitate that, help Americans be able to get health insurance that they're able to afford, that would provide them and their families the type and quality of health insurance that they need. We passed bills like that, and we sent those bills over to the Senate where, as I always say, the Senate is where all good bills go to die. Those bills never became law. What, of course, did become law is the Affordable Health Care Act, also known as ObamaCare. I'll speak in just a moment on the issue of its unworkability when it comes to the issue of the data hub. It's not really talked about much, but it is a crucial element if ObamaCare is going to go forward, and it is also one that affects every American's life and their privacy, whether you're in an exchange or not. Why is that? Because ObamaCare is creating a data hub on every American. It will look at and collect and gather together in one place all of your personal information, all of your personal health information, all of your personal financial information. It will be a central location, if you will, for every American's private and sensitive information that will be right here in Washington, D.C., for the bureaucrats and whoever else may be able to get to it. Can Americans really trust this system that has key information about your income, about your Social Security number, about your email addresses, about your family, about your family's size, about your medical records, about what you said, how you checked boxes off at the doctor's, your veteran status? The list goes on and on. The answer is an emphatic ``no.'' With the ObamaCare data hub, Americans' personal information will be shared with a myriad of distinct Federal agencies, whether it's over at the Department of Justice, over at Social Security with all of your Social Security information, the Department of Homeland Security, and also with your veteran information down the street at the IRS. We know how secure they are. It will be over at the Treasury Department with all their information; Health and Human Services with your medical information. It's all going to be sent, come October 1, right here to Washington, D.C., and collected through this central data hub. As I said, we have already witnessed many security breaches over the years with numerous government agencies, and the potential now is even greater. It's magnified with abuse, and it's staggering. We know in addition, besides the abuses by the people themselves who are going to be operating it is a problem--just look at NSA--but we also know the system will attract outside identity thieves and hackers; and it is clear that the system really doesn't do an adequate job in that regard. The system has not been fully tested for a security system, so therefore, how can it protect Americans' personal records? To that end, let me just bring up here a little bit of information. A little bit ago, Kay Daly--she is with the Health and Human Services Department--an assistant inspector general, told lawmakers at a House hearing that the system security plan and risk assessment filed way back on July 16 was not made available to the inspector general and to her office, which is for a system that is supposed to be opening up in just a few days. Former Social Security Administration Commissioner Michael Astrue noted that the review was done back in July and the AG audit was due on August 2. He said: There must have been a draft at that point. He also observed the hub's development, until he left office, and testified during that same hearing: I am just not used to the idea that an inspector general comes in and asks an agency for a thing, and they're told no. Well, that is the situation here, and that is why many of us have real questions about the security and the testing of it. Look, we have witnessed privacy abuses by a myriad of government agencies--by the NSA, by the IRS. The list goes on. That same agency that targeted various groups--conservative groups, Christian groups, pro-Israel groups--they will now be the same ones greatly involved in administering this data hub. This ObamaCare data hub will end privacy in this country as we know it, and it will grant unprecedented power over all U.S. citizens by the government and bureaucrats right here in Washington. The Obama administration has said that they are delaying the employers' responsibility provision of ObamaCare, which is the right and responsible thing to do. They should delay every part of ObamaCare because it is abundantly clear that the responsible thing to do is to stop and delay ObamaCare entirely and stop, most importantly, this unprecedented intrusion into every American's private life.

Mr. GARRETT

Mr. GARRETT. Mr. Speaker, on Saturday, September 21, New Jersey and our Nation lost a true hero. Staff Sergeant Timothy Raymond McGill was killed in Afghanistan in support of Operation Enduring Freedom. After graduating from Ramsey High School in 2001, Staff Sergeant McGill joined the Marines and later deployed to Iraq. In 2008, he joined the Rhode Island National Guard, basically to chase his dream of joining Special Forces. Then, in 2011, Staff Sergeant McGill was made a weapons sergeant and was most recently assigned to A Company, 2nd Battalion, 19th Special Forces Group, Army National Guard, in Middletown, Rhode Island. In between these deployments, Staff Sergeant McGill volunteered at the Ramsey Fire Department back home in the State of New Jersey. You see, Staff Sergeant McGill was always committed to his community and to this country. He was truly one of the best and the brightest of the Fifth Congressional District. My prayers are with the family of Staff Sergeant McGill.

Mr. GARRETT

Mr. GARRETT. Mr. Speaker, prominently featured on the White House Web site, President Obama issued the following memorandum to all heads of executive departments and agencies: My administration is committed to creating an unprecedented level of openness in government. We will work together to ensure the public trust and establish a system of transparency, public participation, and collaboration. Openness will strengthen our democracy and promote efficiency and effectiveness in government. Unfortunately, despite once serving as the White House Chief of Staff, Secretary of Treasury Jack Lew apparently never got that memo. On June 7, shortly after the news broke that the Internal Revenue Service engaged in the reprehensible practice of targeting conservative-leaning political groups, I sent a letter to Secretary Lew with a handful of questions relating to his time served as White House chief of staff. Specifically I asked: First, when was the first time Secretary Lew, as chief of staff, became aware of the IRS's targeting of tax-exempt groups, including rumors or media reports of targeting, independent of his knowledge of the IG's investigation? Second, given that IRS Commissioner Douglas Shulman made numerous trips to the White House between October 2009 and December 2012, I asked Secretary Lew, again as chief of staff, if he attended any meetings with Shulman. Next I asked if anything was discussed relating to the IRS investigation concerning conservative-leaning organizations and their tax-exempt status. Finally, I asked if Secretary Lew, as chief of staff, was involved in any or had any knowledge of rumors of conservative groups that were being targeted or of media reports highlighting the IG investigation relating to the targeting or any IRS personnel involved in potentially inappropriate targeting of conservative groups. Well, my letters went unanswered week after week after week. So I sent numerous emails and made phone calls to the Treasury Department, requesting a reply to my letter. Finally, finally a letter came. Unfortunately, rather than simply answering my questions and putting to bed any appearance of impropriety, Lew chose to not answer any of my direct questions. Now 3\1/2\ months have passed since I asked those very simple and direct questions. I still cannot get an answer from him. So I'm here today to encourage you to join me in the fight to get answers from Secretary Lew. You see, the President's memo was very clear--his government is to be the most transparent in the history of this great Nation. Well, then, we have to bring Secretary Lew up to speed on that memo. Jack Lew served as chief of staff to the President while some of the most egregious, reprehensible behavior ever displayed by the IRS took place. The American people have the right to know what he knows about the IRS scandal, when he knew it, and what involvement he had, as chief of staff, with personnel at the IRS. It is essential to the functioning of a representative government that the citizens--the voters who are represented--have confidence in the integrity of the system. If they don't, the government won't be trusted. Government must earn that trust. That means that the men and women who manage the day-to-day affairs, such as him, must be trustworthy people. And to maintain that confidence, the public--the men and the women must avoid even the appearance of impropriety. It is that principle that judges adhere to when they recuse themselves from cases where it may appear that they would have an interest in the outcome. The public must be assured that the outcomes generated by the men and women in Washington are not influenced by the conflicting interests. Otherwise, the system--whether it's corrupt or not--will have the taint of corruption; and that's just as bad. The President was right to emphasize transparency, and it is essential to the proper functioning of a representative government. It's up to the citizens and their representatives to demand that transparency and the propriety that it maintains. So again, I ask my colleagues and you, the American public, to join me in demanding the openness that President Obama promised. And to Secretary Lew, I am still waiting for those answers.

Mr. GARRETT

Mr. GARRETT. Mr. Speaker, I thank the gentleman from Texas for his leadership on this legislation today. I rise in support of H.R. 1155, which is the National Association of Registered Agents and Brokers Reform Act. This bill is, as we like to say, a commonsense step that will create a clearinghouse, if you will, for insurance agents and brokers alike to obtain approval to operate on a multistate basis. Under current law, an insurance agent who has clients in more than one State has to obtain licenses in each and every one of those States. The regulatory process, as you can imagine, varies from State to State. Obtaining and maintaining a license is both time-consuming and very expensive. Having to complete this process over and over and over again basically compounds the difficulty and often proves daunting, quite honestly, to smaller agents who are just trying to do their job and to serve their clients and meet their needs. What we have here is the NARAB clearinghouse. This would allow the agents to complete the process only twice--once in their home State and then once again for NARAB. Then they would be eligible to sell basically in all the States. Here is an important point: NARAB is supported by all the stakeholders, including, as the gentleman just said, by the State insurance regulators. It does so because it brings much-needed efficiency to a multistate licensing process. While doing this, the legislation would also preserve--and to me this is very important--State-based insurance regulation and also consumer protections. Finally, this legislation would not--as was just pointed out--create a brand new Federal insurance regulator in its place. By law, NARAB would not be a regulator or a part of any Federal agency. It would have no regulatory authority. With 56--56--different approaches to life insurance, this bipartisan bill would reduce needless red tape and complexity that is out there, and it would help insurance agents better serve their clients. I urge this House to adopt this legislation today.

Mr. GARRETT

Mr. GARRETT. Mr. Chairman, I have an amendment at the desk.

Mr. GARRETT. Mr. Chairman, it was my impression that this House had put an end to earmarks, and yet the Transportation-HUD appropriations bill contains $125 million solely for the benefit of the Washington Metropolitan Area Transit Authority, also known as WMATA. This is just a fraction, mind you, of the $1.5 billion that Congress intends to give the D.C. Metro system over a 10-year period. This is not just your everyday average earmark. The Heritage Foundation has dubbed this subsidy ``the largest earmark in American history.'' So I have an amendment here at the desk, and it is very simple. It simply eliminates this earmark that has received subsidies since 2008. At a time of record budget deficits and debt, the American people cannot afford to provide yet again another earmark, another special subsidy, especially when you take into consideration the fact that the D.C. Metro already receives funds from a variety of other Federal sources, from other Federal Transit Administration grants and programs. Also, you add to that, given the performance of this agency, I find it absolutely astounding that the American people should want to give even more of their hard-earned cash to this agency. In addition to daily service interruptions, lax management, and poor general performance, Metro has a significant record of wasting money. Right here in The Washington Post, it was reported that Metro spent $382 million to rebuild cars, only to have them break down even more often than the cars that they didn't overhaul. The Post also pointed out that when senior agency attorneys wanted new offices for themselves, they spent over a quarter of a million dollars to accommodate them. And why not? It's simply our money, taxpayer money being used. Last year, it was reported that the Office of Inspector General uncovered several personal and unwarranted expenses on Metro's credit cards, such as $2,000 worth of gift cards, things like camcorders valued at $730, and even $180 for headphones. So even when they spend this money on things it should be spending on, the facts are really disturbing. The Federal Government pays, mind you, over half-- specifically, 56 percent--of their capital costs already. Now, I understand that we'll hear others who say, D.C., the Nation's Capital, it's a tourist destination and it has a large population that utilizes it as transportation to get to work, but this is nothing unique. The same can be said for cities back in my neck of the woods like New York City or over in Chicago or Philadelphia, Boston, and Los Angeles. Should they get the same earmarks as well? What is it that is unique about Washington, D.C., that they are the only ones that get this type of earmark? Congress should not be forced to make the taxpayers use their hard- earned money to subsidize a transportation system that has failed over the years to get its fiscal house in order. We owe it to the American people to be better than that. I yield back the balance of my time.

Mr. GARRETT. Mr. Chairman, the gentleman first begins his comments by attacking my motives in this matter, saying that--what did he say? I do not care about lines such as Metro or the people it serves. I would ask the gentleman, who's not paying any attention to me, exactly what is it in my statement would say that I do not care about the people that it serves? Because I do care about them, as much as I care about the subway system or the metro system in my metro area, such as New York City or in my metro area, such as down in Newark, New Jersey. I care about them as well. But you know, when I go back and I talk to those people who use those services, whether they be residents of New Jersey or residents of New York, or maybe they're residents from Virginia, from your neck of the woods up here, who come to visit the financial capital of the world, New York City, or the Garden State of New Jersey, who want to use our metro systems, they ask me why it is that D.C. gets a special deal, why D.C. gets $1.5 billion over 10 years for their system. Let's get the facts straight as far as the subsidy for the capital cost of 65 percent, and why our cities in our area, what is it that's so unique and special about this area and not about Chicago or Philadelphia or the other areas. So I go to my first question. What is it in my statement that you said, you could slander me, sir, by saying that I do not care about the people who ride on these systems?

Mr. GARRETT. If I had some of the charts showing where some of the wealthiest districts are in the Nation, where, despite the turmoil of '08 and the financial crisis, where prices of real estate continue to rise, where revenues continue to go up, it would be in this section of the country, not in Boston, not in Philly, not in New York or Newark. But this is one of the wealthiest portions of the country. And you're right, sir. If this is an area that should look for subsidies, it should look for subsidies from some of the wealthiest people in America that live right here, not under the underlying bill. It's not asking for people from your district to pay their fair share, or the people from Maryland or Virginia to pay their fair share. It's asking for people from all across the country to chip in to pay for here, when you're not allowing the people from New York, Newark, Philadelphia, Chicago, out in California--those other areas have subway systems and metro systems. You're not willing to help them out. But, Mr. Speaker, you want everyone else in America to help the residents who live here and subsidize their costs, but you're not willing to help out the people who live in my neck of the woods. And that, sir, is unfair to my constituents. That's unfair to all the constituents in all those cities that are looking for a fair deal and for efficiency and economy from our government, and not for special deals. I'll end where I began. I thought Washington had done away with earmarks but, obviously, with this legislation and the special interests that are being catered to here, we have not done so.

Mr. GARRETT. Mr. Chairman, I demand a recorded vote.