Louie Gohmert

Mr. GOHMERT

Mr. GOHMERT. Madam Speaker, it is a pleasure to be here as we start another 2 years in a new Congress, the 111th Congress. It is an humbling honor to get to follow in the footsteps of so many giants. I come today to talk a bit about the economy and what's been done so far and what is being proposed to be done in the future. Now, there is so much to be learned from people who have been around this place and been on this Earth for many, many decades. A fellow down in Nacogdoches had the wisdom, when he was told by a young reporter on his 95th birthday, ``Congratulations on your 95th birthday, I hope you're not offended, but I hope I never turn 95,'' and the gentleman said, ``Well, son, that's because you're not 94.'' But a man over 90 approached me there and said that he was sick and tired of hearing people say, oh, this is the worst day since the Depression, some people saying it's as bad as the 1930s Depression. And he said, let me tell you about the Depression. I was there. Sometimes we went for 2 days without eating. And I look around nowadays and I see people offended if they don't have three cars in their family. They've got a computer, they've got cell phones, they've got all these things, and they're trying to tell me that this is as bad as the Depression when my family couldn't eat, when unemployment, by some estimations, at times was going toward 50 percent, but by most agreement was more like 25 percent or so. It was an incredibly rough time for America, but they managed to get through it. There is interesting literature out now that says, by government intervention all through the thirties, the economy never got better until after World War II started; that all the government intervention may have actually prolonged the terrible Depression rather than helping. Here in this day and time we have people with the best of intentions, they want, truly, to make it better. There are others that we have here in Washington, part of the government that perhaps want to reward their friends. And that is not a partisan comment, that apparently is a bipartisan comment because we've seen it on both sides of the party issue. But to be told repeatedly that this is a terrible depression, worst economy since the thirties, I was around in the late 1970s, I was around in 1980 and 1981. And so I gathered some numbers about those days. We had a 1973 oil crisis and a 1979 energy crisis. And we had, let's see, unemployment at 5.1 in January of 1974. And it rose, let's see, mild recession from January to July. But unemployment got to 7.5 and eventually got over 10 percent. And I recall thinking, when this guy Reagan started talking about--and I was in the Army at the time at Fort Benning, Georgia--and I heard him, and he was just such a gifted communicator, and he communicated confidence and a good feeling about this country. And it helped make America stronger when America felt stronger. There is so much to the mental status of the people of this country. But by 1979, inflation had reached 11.3 percent. In 1980, it soared to 13.5 percent. And here we had a guy, Reagan, who was saying in 1980 that as President he could bring down double-digit inflation, he could bring down double-digit unemployment, he could bring down double-digit interest rates. I recall my wife and I bought our first house out near Fort Benning, Georgia. And my dad was concerned with the high interest rate being over 10 percent. And he said, you know, son, it just doesn't get any higher than that, why don't you wait until it comes down. And yet at the time we were selling our house after my 4 years at Fort Benning, there were people wanting desperately to absorb 12 percent loans because the interest rates had gotten so high. In fact, I've got some data gathered on that. The Federal funds rate was about 11 percent in '79; it rose to 20 percent by June of 1981. The prime interest rate eventually reached 21.5 percent in June of 1982. And here was this candidate in 1980 named Reagan saying ``I can help bring these things down.'' And I remember telling my wife at the time, ``I like this guy.'' As a member of the Army, I could not criticize a Commander in Chief because he was in the chain of command and that's a court-martialable offense. So you couldn't say anything critical about the Commander in Chief. But I was excited about this guy Reagan. But I said to my wife, let's face it, there is no way one man, even the President of the United States, could bring down double-digit unemployment, double-digit inflation, and double-digit interest rates. I mean one man just can't do that. And these things started peaking through the late 1970s, 1980, 1981, and 1982; and lo and behold, he was able to turn things around. We had a massive tax cut, and the economy turned around and started going the other way. And lo and behold, double-digit interest rates fell below 10 percent, unemployment rates fell below 10 percent. Interest rates, inflation, all of those things came down, and I was wrong. Apparently one man could make that much difference. Now, some of the folks know here, Madam Speaker, I like President George W. Bush. I think he is a good man, an honorable man, despite what some folks say. I like him. He's smarter than people give him credit, but as Jeff Foxworthy says, often when people who are not from the South hear a southern accent, they immediately deduct 50 IQ points from what they think the IQ of the speaker is. But when our Secretary of the Treasury convinced him to say, as the Treasury Secretary said, that we're about to have this terrible depression and we could have a stock crash like '29; in some of the private meetings, it could be that once the first bank fails, they'll all fail. We'll have a worse depression than the 1930s. We'll have all these terrible things. Those kinds of things when said from the highest people in the country can become self-fulfilling prophesies. You need to have Presidents that will come forward and say ``The only real thing we have to fear is fear itself,'' as Roosevelt did. You need to spread calm and confidence. And there are obviously many issues on which I disagree with President- elect Obama, but one of the things we see about this man, as he prepares to take over the Presidency, he has a real gift for spreading confidence, spreading calm, and spreading hope, as he likes to say. Now, we've been hearing a lot lately people trying to set the bar so low that anything he does will pass the bar, but the fact is we need all of our national leaders to be spreading confidence. You don't do that by saying, ``Oh, we're in this terrible depression,'' because we are not. When you actually look at the numbers, we are in so much better shape as a Nation than we were in 1980. We don't have hostages being held in Iran and looking just so helpless to the rest of the country. President Bush has certainly made clear, and I think by some of President-elect Obama's appointments he has made clear to the rest of the world, you don't attack us or we will respond. And so I hope that will continue. It's an important message. But we should not claim that things are worse than they are because that becomes self- fulfilling. Though I have to say, by scaring Congress enough, there were about 60 Republicans and about three times that many Democrats who voted for the bailout bill mainly because the Secretary of the Treasury scared them enough into doing so. That's not a basis for making good judgments to help direct this ship of state. Now, there's another $350 billion of the original $700 billion in TARP funds that were in that bailout bill. All that is required--and I know there are some who say, oh, no, in Congress we will get to have an up-or-down vote. The bill doesn't say that. The bill says all the Treasury Secretary has to do is file a plan. I mean, goodness, his plan could just say ``I want to spend $350 billion and send it all to my friends,'' and under the law if there is no vote disapproving within 15 days, he can take the money and spend it. We have already seen $350 billion squandered. Now, I know that Secretary Paulson had his department issue a report last week that says we have studied what we did and we think we did--no, they don't say ``we think.'' They said, we did a great thing. We saved the economy. Well, one of the things they were doing was spending hundreds of billions of dollars, we were told, to get more credit, to loosen up the credit. I have been sent copies of letters from banks that received billions and billions of dollars of taxpayer money and the letters say we're not going to be able to make car loans anymore, we're not going to floor plan dealers anymore. Now, one of the things Congress has done that's been a problem is to force lenders to lend money to people who could not afford to pay it back. So I'm not in favor of doing that. I don't want to force lenders into making bad loans. But when billions and billions of American taxpayer dollars are extended to these huge banks, and at the same time I've seen press releases from those banks that say, oh, this will really help us to extend more credit, lend more money. This will help with the credit crunch, and then follow it up shortly thereafter by saying, we're not going to lend like we used to and we're holding money in reserve. It had absolutely the opposite effect of what it was supposed to have. So that causes great concern. It has not opened up lending. And the fact is this Congress could allocate $2 trillion to Detroit auto makers, but if people cannot buy cars from the dealers and the dealers have all the banks pulling back floor plans saying, we're not going to help you get cars in to sell to other buyers, then it will be wasted money. You've got to have people able to buy cars or any money given to Detroit is absolutely wasted. There was some criticism of Secretary Paulson, and I was one of those who was appropriately critical, for not having more restrictions on the money that was given away. Some of it went to bonuses. Instead of extending more credit, some banks actually bought up competition, which means there will be less credit extended because there are fewer lenders out there to extend that money in the way of credit. So it had the exact opposite effect it was supposed to. And with all due deference to the Secretary of the Treasury patting himself and his department on the back for doing such a great and noble job, I just don't see it in what we've had happen here. I've been joined by one of my colleagues from Georgia, a man I have the utmost respect for. He is someone in whom I have the greatest of confidence and admiration, and I know that when I have an idea, I'm better off running it by him before I float it out publicly. And so I would like to yield to my friend Lynn Westmoreland from Georgia.

Mr. GOHMERT. Thank you, Mr. Westmoreland, for participating. You have made some great points. You know I have talked to a number of builders there in east Texas, where I represent, back in September. I know things were tough in a lot of places in the country back in September, but the contractors were telling me they are doing okay, you know, it's just not fantastic, but they are doing okay. As soon as we started hearing all the gloom and doom, I started to hear people say, you know, we were going to buy a house, we were going to build a house, we were going to buy a car. But since we are told we may be headed for depression, we are going to hold up and wait and see, you know, maybe sometime next year. We don't want to be buying a new house, or building a new house, or building a new building for our business if we are about to hit a depression. So what happens? People quit buying cars, they quit building. Contractors say, you know, we always love when the phone rings, that means it may be somebody that's about to build another building. But, lately, they cringe every time the phone rings, because it means someone else may be calling to say we had talked to you, we were planning on building something the first of the year, but let's hold up and wait and see if this depression really is coming. Let me tell you a little more about the 1980s when people say, oh, this is the worst since the 1930s. Actually, in 1980, there were approximately 4,590 State and federally chartered savings and loans institutions with total assets of over $616 billion. Let's see, between 1980 and 1983, 118 S&Ls with 43 billion in assets failed. Things were going badly in this country. Banks, S&Ls failing, S&L crisis, all kinds of things that had been built up, ready to start happening during the 1970s and in the early 1980s that began happening. Were it not for the foresight to have tax cuts, stimulate the economy, then things never would have turned around, but Ronald Reagan did a good job of doing that. Now, as my friend, Mr. Westmoreland, read the quote, the Fed is printing money. They are printing money like crazy. There are consequences to doing that, for those of us that really believe so many solutions can be found in history, because you can go back historically. As Solomon said, there is nothing new under the sun. There is new technology, but there are not new issues. These things have all been tried and failed, succeeded. So you go back and you say, okay, this is what was done this year, that failed. This was done here, that succeeded. Let's go over the things that succeeded. And we have seen over and over that if you want to create inflation, as we saw in the late 1970s and the very early 1980s, just print money like the Fed is doing now. We are very fortunate that we haven't hit a huge inflation rate in the last 2 months. And why would that be? Well, back last summer, we were paying $4 a gallon for gasoline and now many of us are paying $1.40, that kind of thing, for gasoline. We are very fortunate that the price of energy failed at a time when we were printing money like crazy. But we cannot keep doing that. To print $1.2 trillion over the next 2 years will devastate this country with inflation. We are talking about the 1920s. For those of you who remember your history, going back after World War I, Germany was in very, very difficult circumstances. Their economy was a real problem. They had elected officials, they were trying to turn things around. They thought they could print money and print their way out of their economic troubles. And some people remember the illustration of people carrying wheelbarrows of money to the supermarket--wasn't supermarkets back then--but to the market just to buy essentials and food. That's where this leads, when you just keep unabatedly printing money, like is being done now, the inflation will come. It will devastate this country. It is silly to be doing that when we know from history what happens. If you really want to get scared, look what happened in Germany in the 1920s and going into the 1930s. The economy got so desperate because of all this inflation, they ended up electing a little guy with a funny mustache that was such a bigot and such a mean-spirited man, he devastated the planet. Israel is having difficulty now, having rockets fired on them each day from the Gaza Strip from Hamas. During that little man with the mustache's regime, over 6 million Jewish people were slaughtered. Why? Because good people in Germany got desperate because of inflation, and they elected a man who was going to help with their economy, not realizing just how mentally unbalanced the man was, and millions and millions and millions, the entire world, suffered as a result. This Nation has been the defender of freedom around the world. This Nation has been the most solid economy around the world. The world depends on us to make good judgment in this body. And when we fail, it's not just those of us in this body that suffers, it's the Nation, it's the world that suffers. It is so touching, and the older I get, the more I turn into my late mother, who just got teary-eyed and emotional about all kinds of things, it was deeply touching to see all the children, Madam Speaker, gathered up here around the Speaker's rostrum yesterday as we were sworn in, cute children, all races, both genders, just really neat, great, wholesome, bipartisan, Democratic kids, Republican Members' kids. But the thought that went through my mind is, if we don't change our ways, these are the sweet little children that as adults will pay, literally pay, for what we are doing. We are running debt up on those little kids that they should never have to pay. For us to live now, that is so wrong. We need to be helping our children, not saddling them with more debt, and that's what an overzealous stimulus package will do. That's why yesterday the first bill that was laid down on the desk over here to be filed was a 2-month tax holiday bill. I filed it in December, and I filed it again yesterday with this Congress. It takes the 350 billion still remaining of the bailout bill, and section 4, it's not a long bill, it just has 5 pages, section 4, ``Immediate Termination of TARP Purchase Authority.'' That is an important principle. It is time to end the authority that we gave to one person, the Secretary of the Treasury, with all of this unfettered ability to just squander money. I mean, the main restriction in there was he couldn't bail out central banks of foreign governments. But, basically, you read through the bill--and I am afraid there weren't enough people that did--and it just goes on and on as the Secretary determines. I tried to point out to people, we have never, since we had a Constitution, given that kind of authority to one man. We should never give that kind of authority to one man. It was a mistake. You don't give unrestricted authority like that to just go out and squander money. No matter which party is in power, it doesn't matter in this country, the principles that made us great, the principles that caused the signers of the Declaration of Independence to pledge their lives and their fortunes and cause many of them to lose and give up their lives, their families' lives, their complete fortunes, was the principle that government does not need to have this kind of unrestricted authority. And yet the market dropped 777 points, and all of a sudden people who knew our history, knew the principles on which this Nation was founded, were all of a sudden ready to come rushing in here and give one man that kind of authority. George Washington, before the Constitution, December 27, 1776, was given that kind of authority. He didn't ask for it. He hardly used any of it. He used his leadership to persuade the soldiers to reenlist. That's why the bill was passed December 27, 1776. The Continental Congress knew if these guys don't reenlist in January, we are all dead, and so will our families be dead. So that's why they passed the bill giving Washington this unfettered authority to spend money. He used his leadership to persuade them to reenlist, even in that terrible winter. That's leadership. But as Washington said, a people unused to restraint must be led, they will not be driven. And too often in Congress we try to drive people instead of leading people. So that's one part of my 2-month tax holiday bill. It ends the authority. Now, Madam Speaker, people need to understand that in this bill, the bailout bill that was passed in September, there was $700 billion appropriated. To give another $350 billion, all he has to do is file a plan, and we don't vote for 15 days. My bill is funded by bringing that $350 billion back into the Treasury. So, what did we learn historically from the tax cuts that President John F. Kennedy did, President Ronald Reagan did, and in 2003 President George W. Bush did? We will just overlook the last 4 months where we forgot our principles here in this administration. But you go back to those tax cuts, the economy was stimulated. And each time the revenue into the Federal Treasury did not decrease. It increased dramatically, because the economy went strong. So there are two ways to raise revenue in this country. One is raising taxes, and then you have an immediate increase in tax dollars coming into the Treasury, but the long-term effect repeatedly we have seen it is to kill the economy. Or you can lower taxes and immediately stimulate the economy, and then as a result of the economy being stimulated, then more tax dollars than ever come in than even when you raise taxes. So it is all what you want to happen long-term for the sake of our children and those to follow us, and that is why this bill says instead of the Treasury Secretary squandering, it doesn't use that term, of course, but that is what has happened, squandering $350 billion, it allows the people who earned the money to keep it for two months. So, that is about $101 billion a month that individuals pay into the U.S. Treasury in individual income tax. Now, we really need long-term tax reform. We need to drop the capital gains rate, like Ireland did, to 12 percent, which has really helped their economy. I think their corporate tax rate is 11 percent, so businesses are flooding into Ireland. I am sick and tired too of hearing people say we will never get manufacturing jobs back into America. That is hogwash. Look around the world. Some of us went to China. What was the number one reason industry was moving to China, they told us, why they moved their industry? Yes, they said labor is cheaper, but we have better quality control back in the U.S. Our workers produce better products back in the U.S. But the corporate tax rate is less than half of what it is here. Lower the corporate tax rate. You will see manufacturing jobs flood back into the United States. That is what it is all about. Some of them said, you know, they cut us a deal on corporate tax rates in China so we were able to build a brand new facility with state-of-the-art equipment and it basically was paid for very quickly out of money we didn't pay in corporate taxes, and now we are competitive again because our aging factories in the U.S. were costing us, and now we are state-of-the-art. All you have to do is lower the tax rate. Jobs will instantly appear. Go after our own energy in this country. We know the energy rates are going to come up, and we need to do something about it now to produce our own energy so that we are doing that and this inflation cycle doesn't kill us. Going back to my 2-month tax holiday bill, it says as far as the tax cut part, in the case of wages received for services performed during the period beginning in the first full month after the passage of this bill, the percentage of tax will be zero. Now, I heard from some self-employed people who said, well, it is not going to help me being self-employed. I work just as hard or harder than anyone else, and yet I am not included. Yet that is not accurate. That is included. It says clearly in the case of self-employment income for service performed during the 2-month period, the percentage of tax will be zero. So there will be no withholding during the 2-month period for income tax, there will be no withholding for FICA. I have gotten good suggestions. Newt Gingrich has been extremely helpful in suggestions and spreading the word, as Jed Babbin and Neal Boortz and Steve Morton, so many, many great thinkers have been helpful. But President-elect Obama promised that if you make less than $250,000, you will get a tax cut. Some of us have been concerned when we give tax cuts to people that don't pay taxes that that is not a tax cut, that is welfare. Under this bill, the tax cuts go to people that pay taxes. There are, we know, people who do not pay income tax. They don't make enough. They work hard, they earn a wage, but it is not enough to get to the level of paying income tax. They still have FICA withheld from their check. Under this bill, no FICA will be withheld from their bill, and because the employee has no FICA taken out, then the employer who is struggling to make sure they keep people employed gets a 2-month holiday on paying FICA as well. Some have said, well, this will hurt people on Social Security. No, it won't, because it specifically says that, and this is in section 3, funding of Social Security trust funds is with repealed TARP funds. It is covered. The $350 billion doesn't get to be doled out for bonuses for the Nation's wealthy who have mismanaged their banks or their firms and then reward themselves with bonuses. It doesn't go there. It goes to the people who have earned it. So everyone who is working will get a tax break. Some have said, well, I would appreciate having the withholding not taken out for 2 months, that will really help me for those 2 months, but it will hurt me at the end of the year when I have to pay that. They miss the point. There is no Federal tax for 2 months under this bill. Everybody gets a tax cut. So actually what this very short, very efficient bill does is exactly what President-elect Obama promised would be done, with the exception it doesn't have a $250,000 cap on it. Now, there are those I know who are doing well and are able to live off the dividend income and the interest income, and that is harder, of course, after the stock market went down. And God bless those folks. I am thrilled to death that you are in a position where you can live off of dividend and interest income. I would like to see across-the-board complete tax reform. But under this bill, this does not give tax breaks for unearned income like interest and dividend. This is only for wages earned during this time. So if you are a hardworking American, you are going to get a tax cut under this bill. It does exactly what President-elect Obama promised. For anyone who pays any FICA, income tax, for 2 months you get that tax break. Now, it is so ironic that the bailout bill was partly under the guise that we are going to give all these billions or hundreds of billions to banks so they can increase credit, make more loans, so people can refinance their loans and finance into the new refinance money what they are behind on so they don't lose their homes. Well, I have talked to people who say if they could have their withholding from their check in their check for 2 months, they can catch up. A lot of people fell behind last summer when gas prices were $4 a gallon. They get their withholding for a couple of months. I have seen figures that estimated if your family income, household income is in the $60,000 range, you could get $2,000 or $3,000 over that 2-month period. So they could catch up on the mortgage and you wouldn't have to borrow more money to catch up on your mortgage. You could catch up. I have had some people tell me, I want to get out from under this gas-guzzling car I have got, but when energy prices went up, the value of any car went so far down, now I owe more on my car than it is worth, so I can't trade it in, because I don't have a down payment for another car. I would be without a car, so I have to keep paying on this gas-guzzler. I would like to get a more efficient car. This would allow those people to buy a new car, a more efficient car. It is good for everybody. But we come back to what I said earlier: If people cannot buy cars, then it doesn't matter how many trillions of dollars we give to the auto makers, they are going to still ultimately go out of business. And the trouble with bailouts is once you start giving money to anybody, whether it is a bank, an insurance company, whoever, once you start that process, you will always be able to find someone more deserving of a bailout than those who have already gotten money, and there becomes no good place to stop. Well, when you love someone and you see that they are getting addicted to some substance, and as a judge I saw it, you see them getting addicted to something, then it is time to have an interdiction and say I love you too much to allow you to continue this addiction. We are not going to let you have any more of that. Now, I was upset when we were talking about an auto bailout, because I knew the auto makers had been withholding hold-back money, rebate money, that they contractually owed dealers. They were putting dealers in a bind just because they weren't abiding by their own contracts. As I understand it, they have begun to catch up on that, and that is appropriate. But to see then letters from major banks who have gotten billions of tax dollars who are now saying we are not going to be lending money for cars, we are not going to be lending money to dealers anymore, even though they are wonderful dealers, they have a good business, it looks like they will stay in business for good, we are just not going to lend anymore, that is such an abuse and 180 degrees from what was promised. Now, some would say we should not get the Federal Government into the business of telling lenders what to do with their money, and I am one of those. However, the danger that every bank should have been told by their attorneys is, keep in mind if you take Federal money, the Federal Government is going to have their hand in your business and they are going to tell you how to run it, because they are a partner with you. And I happen to believe if we are going to put Federal money in something, we should have restrictions and tell people like a bank that this is what you can and can't do. Secretary Paulson did not do that. But my preference is don't give away any more bailout money. Let's let the people that earned it keep it and let them decide who deserves to be bailed out and who deserves to have their products purchased. That is how a free market works. When you look back, you see that an open government is a good thing, a free market is a good thing. To my way of thinking, being such a student of history, it looks like from our founding documents the most important job that we have as a Federal Government is to provide for the common defense. Then, beyond that, this Federal Government should create a level playing field, punish cheaters, make sure everybody plays fairly, and then let them play. That is what we need to be doing, and we have gone so far in excess of that. This government, when I heard that we were going to encourage a car czar, I couldn't believe it. I mean, we can't even do a good job of designing our own I.D. card. Can you imagine what we would do with cars? Good grief. We should not be in that business. So I would encourage people, Mr. Speaker, who believe that they would do a better job of spending their own money, to contact their Representative, contact their Senator, call the Capitol Hill operator and they can be connected to their Representative, their Senators, and that would go a long way toward getting this bill to the floor and getting it passed. Because it is not an issue of if the money will be spent, it is an issue of will the Treasury Secretary squander it on your behalf, or will you be able to use your own money to help get this economy turned around.

Mr. GOHMERT

Mr. GOHMERT. Madam Speaker, I do appreciate my friend for yielding. This is a good overall idea. It's a good bill in general. There needs to be more clarity. Many of us have wondered who is building these Presidential libraries, and this will help inform the public just who it is that's doing that. The concern I have is that there is a provision in the bill for filing errors or omissions that could send somebody to prison for 5 years. Now as a former judge, I've presided over thousands and thousands of felony cases. I have sent I don't know how many people to prison. That's not a concern. My reputation was, as one criminal was overheard telling another, ``He will give a fair trial, but if you're guilty, you don't want his court.'' I don't have a problem sending people to prison, but one thing, probably the best conservative organization as far as getting out the message, the Heritage Foundation, and the ACLU have actually been in agreement on, this body, almost on whims, throws in a prison sentence as an added provision, and we are having people go to prison who shouldn't. If it is a dollar issue, then fine them 1 million, 10 million, whatever would be appropriate. But we should not, in this body, continually subject people to being taken down in their home, handcuffed when they made an error that should not be criminalized. So that is the concern I have. This never went through Judiciary. It has been through prior Congresses. It never went through Judiciary, the Crime Subcommittee, to look at that specific aspect. That is a concern, and it is something that we should not be doing, overcriminalizing provisions, by just sticking that in as an exclamation point. It needs to be well thought through before we provide a way to send somebody to prison. I appreciate the time. I hope that could be taken out because that is an aspect that's inappropriate.

Mr. GOHMERT

Mr. GOHMERT. I am a cosponsor on Mr. Shadegg's bill as well, because I love the idea. It would get the economy flying so high, going to strong. Who knows if and when it could ever come down, it would move it so quickly. Thank you.

Mr. GOHMERT. I sure do thank my friend from Georgia. I appreciate those comments very much. This poster pretty much says it all. This is what boils down H.R. 7309 into a nutshell. You have the Secretary of the Treasury Paulson here on one side, and then they have got you, the taxpayer, all the taxpayers across America on the other. The question is, who do you want to spend your $350 billion, because it hasn't been spent very well. When you hear that there are executives that may get millions in bonuses for running their business into the ground, and, sure, the government has some culpability in that, we sure do. Things haven't been run very well. But, obviously, they haven't run them very well either, and they want bonuses while the taxpayers they are taking it from have none and are cutting back on Christmas presents. Because of the way things are going, it is really tragic. My friend from Georgia mentioned the automakers bailout that we voted on tonight is a mistake, it's not properly done. It is only a temporary fix that's going to lead to more and more and more. It sounds like a placation to the UAW. I am much more concerned about car dealers than the UAW. I am very concerned about the auto workers and all these plants all over the country. Because one of the things I found when we went to China a few years ago, a number of bipartisan groups went, talked to different CEOs from industry. Why did you move your industry to China? Over and over we heard them say, well, our quality control was better in America. I thought perhaps they would say we moved because of the cheaper labor. They said, yes, labor is cheaper, and no unions to deal with. But that's not the reason we kept hearing that they moved. It was that we have a corporate tax that's over twice what China has, and then apparently they are willing to negotiate with some corporations, depending on what they bring to China. So I am not as concerned for organizations as I am for the individuals; the workers in these plants, the workers at the car dealers, all these people that will be hurt if the automobile makers in America go down. But I don't think that will happen, even through a chapter 11. But I am extremely concerned any time any entity has money that belongs to other people and they hold on to it as if for ransom, and that is what we are hearing may be happening with some of the hold-back money, the rebate money that is owed by the auto makers to the dealers. And it is just not right. You come in here to Congress begging for money and you are not even going to live up to your side of the bargain? Regardless of what your religious beliefs are, and I never seek to impose mine on anyone else, but Jesus did refer to such a situation in one of his parables, like as in one person being forgiven their debts, and then they go and lord it over someone under them. We are seeing that kind of thing, and it should not be happening, and there should not be a dime provided to the auto makers until they provide the money that is owed to the people that they have, that should be going to these dealers rather than holding them up for the money they are properly owed. I don't think they ought to get a dime until they are properly reimbursed themselves out in the dealerships. Anyway, we have bureaucrats in Washington picking winners and losers. The former Speaker of the House of Representatives, Newt Gingrich, wrote an article this past week, and I quote from it: ``The bankruptcy of the current Washington political establishment makes Representative Louie Gohmert's new proposal for a tax holiday proposal intriguing.'' He went on to say, ``What Pelosi and Paulson are proposing to pour into crony capitalism is more than what it would cost to give every American taxpayer a total Federal tax holiday for 2 months.'' It is a great article and I would commend that to you. ``A people stimulus package, a tax holiday instead of a bailout.'' He has a website at Newt.org. Also American Solutions has some wonderful information about the proposed tax holiday. And Jeb Babbin of Human Events, the publisher there, has a tremendous article on this. He has been extraordinary in his support for this idea. At one point he says, ``Most Americans were opposed to the bank bailout last fall, and neither they nor the markets themselves have confidence that any of the bailouts or `stimulus packages' will work. They will have confidence in Gohmert's plan because it is an economic stimulus that has been proven by history. Tax cuts mean more spending, savings and investment. They pave the way to economic recovery. Government bailouts do not.'' He said, ``Gohmert's tax holiday plan is eloquent in its simplicity.'' Mr. Speaker, that is all I know to do, is come back with simplicity. ``Every American taxpayer would pay no Federal income or FICA taxes for the first two months of 2009. For the typical American family earning about $50,000 a year, that would mean they would keep about $2,000 that would otherwise be paid to the government. People making that kind of money could certainly use $2,000 more than someone getting a multi-million dollar bonus.'' ``In any event,'' he says, ``Gohmert's plan doesn't pay for Wall Street bonuses or let banks use bailout money to buy other banks or pay dividends. It doesn't rely on bureaucrats to pay money out to the right people at the right time or try to stimulate the economy with token payments to people who don't pay taxes. Most Americans pay about 25 percent of their income in Federal income tax and another 7.25 percent in FICA, Social Security and Medicare taxes. ``Computing how much money Gohmert's tax holiday would leave in your family's checkbook is very simple. The fact is, you can just look at your paycheck. Look at the stub. It will tell you how much has been held out of your check. You see how much has been held out of your check for a month for Federal withholding and for FICA. That is what you would get back.'' I would like to point out, there was a quote decades ago from John Kenneth Galbraith about economists. Opinions of economists have been bantered about over and over again. But I think about Galbraith's quote when he said there are only two kinds of economists: There are those who don't know, and those who don't know they don't know, and I think our Treasury Secretary is in the latter category. An interesting article published, ``Less Government is More Better,'' by Ted Nugent. The guy is amazing. He is a rock star, and he is an amazing rock star when it comes to political philosophy as well, and I am quoting from his article. He says, ``That is right, a 2 month, $350 billion tax holiday, and no income tax for January and February 2009. This would be massive wads of your money staying in your pockets where it belongs, surely doing more for the sagging economy than using it to bail out Wall Street or the automotive industry.'' He also says, ``Fedzilla,'' apparently that is his term for the Federal Government here in Washington, ``has just gotten bigger and bigger. Of course, Fedzilla,'' he says, ``bureaucrats such as Speaker Pelosi and others, will fight Congressman Gohmert's proposal because they believe Fedzilla knows how to better spend your money than you do. But this arrogant attitude by Fedzilla-addicted zombies is always the problem, never the solution.'' He said, ``Fedzilla rarely gets anything right. Need proof? Quick, name three specific things Fedzilla has spent your money on which you believe was a wise use of your tax dollars.'' He says, ``Taxpayers are partially to blame for the financial mess created by Fedzilla. We have sat idly by and drank the bureaucratic Kool-Aid brewed by Fedzilla and slowly surrendered our financial independence to big government bureaucrats. Shame on us,'' Ted Nugent says. He says, ``We should have been snarling watchdogs of the bureaucrats with our tax dollars stuffed in their bloated wallets, instead of solace, disconnected, apathetic accomplice lapdogs.'' You have got a quote here from Thomas Jefferson. Ted Nugent quotes Jefferson saying, ``I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them.'' Boy, if that doesn't apply. Of course, Ted Nugent says, ``You think?'' Sounds like my sister's response. ``You think?'' In any event, this is a simple bill. And I know some people have said, won't that hurt Social Security? Section 3 deals with that, and requires the Secretary of the Treasury, in consultation with the Secretary of Health and Human Services and the Commissioner of Social Security as appropriate, to determine what impact the nonpayment of FICA for 2 months would have on the Social Security trust fund and the Federal Old Age and Survivors Insurance trust fund, Federal Disability Insurance trust fund, Federal Hospital Insurance trust fund, and they have to make sure the difference is made up. We have already allocated $350 billion, so shutting them down from using that and saying the taxpayers get it instead sounds like a pretty good deal. I hope it would. We have got to get back to the roots of what America was founded on. It broke my heart back in September when we had this bailout proposed. On that first Monday we took the vote, some of us knew it was going to be tough in the stock market. Why? Because the Treasury Secretary had forecast a self-fulfilling prophesy that the stock market would drop unless he got his $700 billion slush fund. Well, that is a self-fulfilling prophecy. When you promise the market is going to drop unless something happens, it usually happens the way you say it, because the market is fragile. It relies so much on confidence. So it dropped 777 points. Something Biblical about that, 777. Or I guess if you are into I guess slot machines, something intriguing about that as well, 777. But it also broke my heart to see so many people, they knew the principles of this country, they knew what it was founded on. They knew what started the Revolution. They had their history. They knew that the people in the colonies, in what back then were the colonies of America, did not want the king's government, any government, owning all that they held dear in this country. When the king, the government, started exhorting too much power and control and ownership over things in the colony, it started a revolution. When the signers of the Declaration of Independence signed that document, they knew that King George would see it. It was posted. It was made available. It was read out. People knew who had signed it, and so would King George III. They knew if the Revolution failed, their lives were over. You look at the end of the Declaration of Independence. They said ``we pledge our lives, our fortunes,'' and many of them lost both. Some lost their lives, some lost their fortunes, some lost their families, but they believed it was worth it to have a country in which people could be free to decide what to do with their own property. You know, the pilgrims tried this idea of basically socialism. They had a beautiful compact when they came to this land here, the ``New World'' they called it. The compact was they would all share the land, they would all produce from it, they would bring into the common storehouse and then they would share equally. After the first winter, when so many died of starvation, they realized we got to go do something different here. First of all, if you don't work, you don't eat. Sound familiar? That is what the Apostle Paul had to order after the New Testament church tried the idea of everybody bringing into the common storehouse and then sharing it equally. The other thing they did was provide private plots of land to each individual so they could eat what they produced and then share what was left. That is the way America got started. Those were lessons that the founders knew. And they knew that if individuals had the ability to succeed and flourish as private individuals without government control and government constant intervention, that this could become the greatest country in the world. If you read one of John Adams's letters to Abigail after the signing of the Declaration, you can just virtually feel the excitement. He said, ``This is a great day.'' My paraphrase is, this is a great day. We have within our grasp in this country something that the philosophers and the dreamers have only dreamed about, and that is within our grasp. This day ought to be celebrated throughout this Nation's history with picnics and parades, and he mentioned firing of guns. We substitute fireworks. He knew how important it was, because of the ideal that people could have a government, this experiment in government, where they would control the government and govern themselves. And somehow we have wandered so far from that that in September of this year, we could have a bill that so many would vote for that would allow one man, a king of a treasurer, to buy private assets, let the government take them and make money. Let me just say, when you hear somebody in the government say we are going to take taxpayer money and make money with it, then the response should be, it is none of your business. Taxpayers always make more money with taxpayer money than the government could ever do. That is not their job. It is called socialism when the government buys into banks, buys stock in the banks, buys stock in insurance companies, and stock has been offered in the car companies. We have a bill that will make a Car Czar. Can you imagine? I mean, Ted Nugent called the government ``Fedzilla.'' Can you imagine the kind of creation Fedzilla would come up with if it starts being the Car Czar, designing cars and telling Detroit what they have to produce? I wouldn't want to buy one of those. We saw those kind of cars. Not that many people bought the Yugos or the other Russian cars produced over there designed by a government-controlled car company. People didn't want them. They wanted American cars if they could get them. But, in any event, we've come to this time when, in American history, people would willingly vote to socialize a segment of the economy. I was told, well, this couldn't be socialism, this was before the final vote, because I only know three socialists in America and they're all against the bailout bill. Well, it turns out they didn't like the idea of giving Wall Street all this money. They just wanted the government to take over the financial sector. But hearing one of them on television after the bailout, he said, you know, this actually ends up being a great day because we've federalized, socialized whatever you want--he didn't say that, but it's basically socialized a segment of the financial economy, the financial sector. And now we just need, according to him, to take over the rest of it and then we spread it across the country. That sounds good. And I heard somebody call into a talk show and say, what's really wrong with socialism? Well, let me explain it to you this way. When I was an exchange student in the Soviet Union back in 1973, I spent the summer over there; went out to a collective farm, and there were some farmers who were sitting in the shade, you know, mid-morning. Well, I've worked on farms, ranches, growing up in East Texas, and I know, during the summer, like this was, you start your work as quick as you can after daylight, and you want to be finished before the sun gets too hot. I've worked in 104, 105-degree heat with lots of humidity and it isn't fun, so you try and finish before it gets that hot. These guys were all sitting in the shade. And I spoke a little Russian back then and I asked them, trying to be nice, when do you work out in the field? And they laughed at me, at the question. And one of them spoke and said, I make the same number of rubles if I'm out there or if I'm here, so I'm here. That's why socialism never works, because when people find out that they can get just as much as the person that works from sun up to sun down, then it falls apart. Now, the Soviets set a record of having socialism for 70 years. And the only way they could make it work was to have a tyrannical central government that could kill you or imprison you if you didn't play along. But it was doomed to failure. Socialism is always doomed to failure. And this country, if it were to continue going down this road, would not make 70 years unless it went to a tyrannical government as well; and God help us if that were to happen. In any event, I would rather the prayers be that God continue to bless America; that we get back to our founding principles; that we embrace the principles that made America great, and not the principles that brought about the Revolution. My bill, H.R. 7309, helps get us back a little bit on track. And you know what a great healthy by-product would be? When people start realizing how much money they're sending to Washington, they might demand a little better accountability, the kind of accountability we have not gotten from the first $350 billion that have been squandered for who knows what. It hasn't helped. But with that, Mr. Speaker, I appreciate the patience. I would encourage, Mr. Speaker, people all across America to call your Representative, call your Senators, let them know that the taxpayers should be the one to spend the $350 billion, not the Treasury Secretary.

Mr. GOHMERT. That's correct.

Mr. GOHMERT. Mr. Speaker, it's a pleasure to be here on the floor where so much history has been made since the House moved down here around 1858, 1859. Recently I saw an estimate that our Secretary of the Treasury, Mr. Henry Paulson, and the Fed Chair may have committed or are in the process of committing an estimated $7.7 trillion. I couldn't believe it, $7.7 trillion? So I wanted to know how much do people pay each year in income tax? The estimate I got was $1.21 trillion from individual income tax payments is what is estimated for the year 2008. Six and a half times less than what our bureaucrats here in Washington, two people, have committed us to or are trying to commit us to to get the economy going and to make credit more available so people who are lagging behind on their mortgages can catch up? I couldn't believe it. Six and a half times more than individual income tax that's going to be paid in this year? It's outrageous. My first thought was we'd be better off if we had an entire tax holiday for all of 2008, that everybody that paid in money so far this year gets all of their money back. Can you imagine, Mr. Speaker, people around this country starting to think about how much money they would get back that they have already paid into the Federal treasury this year, how much they wouldn't have to pay in for the rest of the year? It's an incredible amount of money. Think about the cars that would be bought, how many automakers would be bailed out as people bought new cars. Think about all of the mortgages, all the new home sales that would take place, new homes built, new businesses built. An extraordinary amount of money. And yet we've got bureaucrats trying to get the economy going, obligating six and a half times that much money. Now, I understand that some of that $7.7 trillion is an investment. We have heard people say here in Washington, leaders I care a lot about, but they've said only the Federal Government has enough patience to hold private assets for years until they meet full maturity. Now, I am finishing my 4th year here, but just in the 4 years I have been here, I can tell you there is no patience in the Federal Government. We can't even keep the same tax incentives in place from year to year, and here we're supposed to hold these administration to administration? The bailout bill in September was a fiasco. Even those who supported the idea of a bailout bill, when you look closely at the bill, should have known this was not the thing to do. We have never in the history of the country since the Constitution came into play in 1787, as it came into being, we have not given one man this much unrestricted, unfettered authority to just obligate hundreds of billions of taxpayer dollars just however he feels it ought to be spent. So you look at the way Secretary Paulson has obligated the first $350 billion. Well, it's been squandered when you look at the effect it was supposed to have. For one thing banks we hear are starting to use the money to buy up competition. What does that do? It monopolizes banking. It kills the community bank for sure. And this is the same Secretary of the Treasury who back in September used his emergency authority to say we're going to stand good dollar for dollar for every dollar you've got in money markets, but we are not going to say the same thing for the good, safe community banks. They're only good for $100,000. He didn't say it. He didn't have to. They knew it. So he knowingly, and it had to be knowingly because I can't believe he's that ignorant otherwise--he's a very intelligent man. He had to know that he was intentionally creating the biggest 1-day run on banks in American history as people went in, pulled their money down to the $100,000 level that had that much, and moved it to money markets. Maybe that was the intent. Since he comes from Wall Street, he wanted to take it out of the community, the safe, commercial banks, and send it to his friends on Wall Street. Maybe that was the point, but he did that. Now, others for whatever reason have gotten money and all of a sudden decided to tighten up credit. I have a friend, a constituent in Nacogdoches, Texas, who has a restaurant there. He went down to Wells Fargo, he tells me this week. He went down, I believe it was last week, to Wells Fargo in Houston and asked for a loan, and they said you're just a little late. Apparently after Wells Fargo, they said, got their money from the Federal taxpayers, they tightened the screws on credit and now they could no longer lend it to him. They could have if he had been there sooner before the Federal Government gave Wells Fargo the money. But now that Wells Fargo got the money, it's time to pull the plug and not lend to good borrowers anymore. That was not the intent. I was against the bailout, voted against it both times. Did not support it. You read it. We should not have given that kind of authority to one person and especially the provision that allowed him to hire whatever advisers and whatever managers, whatever he wanted when he was going to outsource that. And now I hate to be in a position of saying I told you so, but it wasn't a good bill and now we have seen that. Now, because he was doing all this fear mongering for 2 weeks, you know, the financial sky is falling as he ran around, he scared the stock market into paranoid schizophrenia. That's why it's up, it's down, it's up, it's down. The least little thing sets it off because he scared it into that. You cannot have a national leader go on television and say we're about to have a worse depression than the 1930s. We're about to have a stock market crash like 1929. You can't do that. You have to be the one that says ``we have nothing to fear but fear itself.'' Calm down, it's going to be okay. And it turns out all the while I read something that indicated that we had more home sales in September than any month since the year 2003. So things were going pretty good until we got all that fear mongering. The other thing was he said he was going to buy troubled assets, buy the mortgage-backed securities. And if I understood right, before the Senate he testified he was already thinking by the time it passed the House that he was going to have to do something else. Maybe it was the next day. If he were to have been considering doing something else other than what he represented, going back to my days as a judge, if somebody, whether it was the Secretary of the Treasury or anybody else, comes in and gets money based on false premises or false promises that he knows he's not going to follow through on, you get into some interesting doctrines, whether it's a promissory estoppel, fraud, different things like that. The bottom line is it's time to end his authority. Now, I've had people in this Congress tell me, no, what was negotiated with the Treasury was that we will get a strict up-or-down vote before Paulson can spend the other $350 billion. That's not what the bill says. The bill basically says that before he can squander the other $350 billion, and ``squandering'' is my word and I paraphrase based on his prior performance, that before he can get that $350 billion, all he has to do is propose a plan, and if Congress doesn't vote to disapprove the plan within 15 days, he gets the money. They could do that over Christmas. People not get back in time to have a vote, and he's got the money. So it's time to end that. That's why even though my first thought was a whole year tax holiday, and imagine what that would do for the economy, it would be extraordinary, there were not a lot of supporters for that. I love and cherish and appreciate the support of the great congressman from the State of Arizona, John Shadegg. John has been a confidant. He has been a helpful source and resource. He liked the idea and was telling me tonight he may go ahead and file that anyway. But in looking at the $350 billion still unspent of the original $700 billion that this Congress allocated for him to spend, let's cut that off and let's see what we could get instead. Instead of letting Mr. Paulson spend that money, let's let the taxpayers keep their own money for 2 months. What you would do under this bill, and we filed it yesterday, H.R. 7309, it would allow for the months of January and February a complete tax holiday. This isn't by and by in the sky. This is real time. In January if this bill were to be brought to the floor--and I feel sure if it gets to the floor it will pass because otherwise people would be afraid to face the voters if they voted not to let taxpayers spend their money but to allow Paulson to continue to have that authority or some other Secretary of the Treasury. Let there be no Federal withholding for the months of January and February. Not only would there be no withholding, the tax rate, as it says in the bill, for wages received for services performed during the period beginning January 1, 2009, ending February 28, 2009, shall be 0 percent. On down it indicates self-employment income for services performed during the period beginning January 1, 2009, ending February 28, 2009, the percentage shall be 0 percent. So, basically, getting a two-twelfth or 16\2/3\ percent tax cut for the year 2009, now, that will help get the economy going. Why not let somebody have that substantial amount of money being pulled out of their check and sent to Washington for Paulson to squander, why not let them have it, let them catch up on their mortgage? Because I know, I have heard a number of people say we fell a little behind back when gasoline was $4 a gallon. I can't get my breath. I can't catch a breather. Let them get the breather by getting their own money, getting their own FICA. Because that means even people who are on the lowest wage-earning scale, who don't make enough to pay income tax, they still have FICA withheld for Social Security and all from their paycheck. This would let them have that back, give them a boost. Since they are not having to take anything out for FICA, the employer would not have to match that for 2 months. That will allow the employer not to have to fire anybody for a couple of months, give them a little breather to catch up. Then at the end of the year you have 2 months for which you did not have income that's taxable. Now, the reason we had to word it the way we did was because people were saying, man, if that were about to happen, we will just postpone Christmas bonuses and put them in January or February. Well, that's not what this is for. This is for wages earned, for services performed during those months, and that would make it work. Now, I have been joined by my friend here from Georgia, Dr. Paul Broun, who it is an honor to serve with. I would like to yield such time to my friend, Paul Broun, as he may use.

Mr. GOHMERT. Certainly.

Mr. GOHMERT. It absolutely did, no question.

Mr. GOHMERT. You remember correctly, yes, sir.

Mr. GOHMERT. It certainly did.

Mr. GOHMERT. That's correct.

Mr. GOHMERT. It would be H.R. 7309.

Mr. GOHMERT. Absolutely.

Mr. GOHMERT

Mr. GOHMERT. Mr. Speaker, this reminds me that this begging for money for a bailout is a fix. I saw it a lot in drug dealers and in drug addicts who would come before my court for sentencing. It was the same story. They would come in. They would have that first little rush from that first fix, and then they would have to have more and more and more. If you really love them and you care about them deeply and want them to reach their God-given potential, you cut them off and say, ``I love you too much to start you down this road.'' In this case, bankruptcy is the place to go. That's why it's designed by Congress. Let's get this fixed so that it will be good for all Americans.

Mr. GOHMERT

Mr. GOHMERT. Mr. Speaker, today we passed a truly historic bill because the Secretary of Treasury had come forward and told us that if we didn't pass it, we were to be afraid, be very afraid. So people were beginning to panic around the country. Credit was freezing up. It was before and even more so after he spoke. And so it was necessary that we do something. For most of us, we heard from a lot of people saying please don't bail out Wall Street, don't give them $700 billion. The last couple of days we heard from car dealers, from bankers, from shopkeepers, small mom and pop businesses about to go out of business saying you've got to do something. So Secretary Paulson's scare tactics had worked. The underlying problems may still be there. In fact, some of them are, and we still need to address them, and I have confidence that we will. The underlying banks had money. The community banks, solid. But there is a crisis of confidence and lending is coming to a halt. Now, some problems in the industry were created by Congress where we forced people to lend money to people they wouldn't have otherwise. That's a problem. That needed to be fixed. But we were told basically in theory by the Secretary that this would be a type of shock and awe, that we would put so much money into the Wall Street market that it would shock the economy and people would respond favorably and everything would be great as a result. I, like my friend Ms. Foxx, hope that this works. I don't think it was necessary. I think it was problematic. And it ought to scare people when the government says, we need $700 billion to bail out an industry and that will make everybody better, and please raise the debt ceiling by $1.3 trillion. I thought it was just $700 billion. Well, we raised the debt ceiling by $1.3 trillion today just in case. Apparently, the good news is we will spend $700 billion completely at the Secretary of the Treasury's whim, as he determines. You will see in the bill, those that bothered to read it, over and over ``as the Secretary determines,'' ``as the Secretary determines.'' And then we are going to have to hire some people to manage all these assets that we're buying. That may be outside the $700 billion. Maybe that's why we need to raise the limit to $1.3 trillion. But being an historical fan, being such a student of history, you cannot find in the history of the Nation a time before when this government, this Congress, had so much faith in one person that they said, ``Here is $700 billion. Do with it as you will. Make our Nation well.'' Now, if you go back before our Constitution of 1787, you will find that one time something like this was done, in 1776, December 27 to be exact. Many of the people that had signed up in the Army had done so for 6 months, and they signed up around the time of the Declaration of Independence; so their time was going to be up in January. The Continental Congress heard that many of them would not reenlist; so they were scared. George Washington never asked for this kind of power, but they knew this man. They knew he was not in it for himself and he wouldn't reward his friends. He was doing everything he could, to the tune of sacrificing his life and his fortune to help create this great land. So they gave him this power. He didn't use it. When he tried to get the guys to enlist, he gave one of the most impassioned speeches, and his pure leadership and example was enough to inspire them. Well, there's a picture in the Rotunda just down the hall of him coming in. He wrote Bible verses on his resignation, and he tendered the resignation and did something no one had ever done in history: led a Revolutionary Army, won the Revolution, and then came in, resigned, and went home. Nobody had ever done it before or since. They could trust that man. I've studied history. I am a fan of George Washington. He is a hero of mine. And Secretary Henry Paulson is no George Washington. So let me leave you with this: When you hear anybody in the government say ``We're going to take your tax dollars and we're going to make you money,'' then that's when you need to be afraid because they have moved over into the socialist realm. And you can always make more money than the government can. That's the thought I leave with you, with the hope and prayer that this does inspire the confidence that was looked for so the economy does free up. I had hoped leadership would do it, but now apparently it will take $700 billion, and may God help us all.

Mr. GOHMERT

Mr. GOHMERT. Madam Speaker, we've heard a number of comments about we've just got to bite the bullet and do this. We heard the same things about let's bail out Fannie Mae and Freddie Mac. We've got to take this one step. And then we heard from the former chairman of the FDIC, guys, you don't realize, if you do this, you are going to start the dominoes falling. People have talked about this precipice. Making this vote, passing this bill is jumping into the precipice because next we have got to come bail out the community banks that are doing just fine. If we would allow the banks to value these mortgage- based securities at the very value Paulson wants to take taxpayer money and buy them, they would be okay. Washington Mutual wouldn't have failed. We hear about we did the right thing with Chrysler and New York. Those were loans. This is putting the government in the position of buying all these things. And as the FDIC former Chair said, when the Federal Government buys them, they immediately become worth less. That is the way it is. That is the way it will be. And nobody seems to ask, who is it that is going to manage these assets? I have been asking. And finally the answer I got was, well, of course, we're going to have to outsource that. You're going to outsource it to the very people that caused the problem. We're going to give them billions for assets they have mismanaged. And then we're going to hire them to manage those assets. Please, please don't betray this Nation's great history. The committees used to do good work and ferret this stuff out. They haven't been allowed to do their work, or they would have done a better job. Let the committees do the work. Let's get a better bill, and save America from Congress hurting it by jumping off this precipice.

Mr. GOHMERT

Mr. GOHMERT. Madam Speaker, I object to the vote on the ground that a quorum is not present and make the point of order that a quorum is not present.

Mr. GOHMERT. Madam Speaker, I move that the House do now adjourn.

Mr. GOHMERT

Mr. GOHMERT. Madam Speaker, this was a historic day. There was a bill in which we had Members who meant well, who had come to this floor and said, look, I understand we all have these principles, and this violates some of our principles, but we need to set those aside in order to avoid risk here. Well, first of all, that is a faulty premise. I just couldn't think of anything but the Declaration of Independence, when the people who founded this place came forward and said the principles of not having the king, not having the Government run everything are too important. And they signed their name where everybody could see, pledging their lives, their fortunes, their sacred honor, saying, ``On these principles we will stand or fall.'' And I think today the House, by its vote, said we're standing on the same principles. But not only that, these are the principles on which this Nation has become the greatest Nation in the world and the most prosperous. We can't abandon those principles. So to have a bill that would come before Congress that basically gave the Secretary of the Treasury incredible powers--he was going to be able to bail out any bank in the world with American taxpayer dollars, the only exception was a central bank of a foreign government, but other banks that weren't central banks of other governments could be bailed out. And then, looking at judicial review, as that's my background, it was extraordinary. Nobody was going to be able to object legally and have a chance of prevailing under the standards that were set forth. So the American people need to hear this message: Don't panic. You saw a Congress bipartisanly come in here and stand on principle and want you to know, don't panic, we are going to address this. We're going to come back, it will take a couple of days, and we'll look at the other solutions. One of them was proposed by the former Chairman of the FDIC and said, look, Paulson wanted $700 billion of American taxpayer money to buy these mortgage-based securities that, because the market is frozen, they have no value. And he is going to put a value on there, and it would be either the value, if you do a discounting based on the cash payments made on that mortgage, how regularly they're made, there's a way to get a formula and put a value on there, or you can base it on a discounted value of the underlying property that is securing that mortgage. And then you have a value. And that's what Secretary Paulson was going to come in and spend to buy these assets with American taxpayer dollars. The FDIC former Chairman said, look, if you will just allow these banks to value these assets, what they're really worth and what Secretary Paulson was willing to come in and pay, then they're not under water, the banks don't fail. Washington Mutual didn't have to fail. And even when it failed, all those people that had money with Washington Mutual, they woke up the next day, they had the same money in the account, it is now under a JP Morgan name. And the same way with Wachovia; all their deposits, as I understand it, they have been purchased, and the people can wake up tomorrow and know they've got all that money, it's just under a different name, in the same amount. Don't panic. When Roosevelt said, ``All we have to fear is fear itself,'' that is so true right now because this Congress is committed to principle in a bipartisan way. And I appreciate my friend, Ms. Kaptur, and her diligence in pursuing this. And we've heard some of the same presentations. And we're going to come back with a better bill; and if we don't, we're going to keep doing it until we get it right. Some of the other proposals were excellent. You know, rather than make American taxpayers buy these things--including in, possibly, foreign countries--why not just say, look, if you will come and buy these assets, you won't have any capital gains on the income you make off of these, that encourages the free market to flow. We have heard--I was not aware--that there may be hundreds of billions of American dollars in foreign banks. And one idea was, if you say we will allow you to repatriate those hundreds of billions of dollars if you will bring them in, no tax, no penalty, and buy these assets to help things along, that brings America money. There are all kinds of fantastic ideas. And we are going to be stronger in America if the fearmongering will go away so Americans can use their own judgment and understand that this was a good thing today. Please don't fear, please don't panic. We're going to come back from this stronger, with our principles intact.

Mr. GOHMERT

Mr. GOHMERT. I appreciate my friend, Mr. Garrett's, comments. I heard him earlier tonight on Fox Business News. That's the first I had seen that channel, and it was quite good. Perhaps if they had been on the air longer, maybe we wouldn't be in this problem, people would be watching that. But I heard one lady comment that there is an adage that ``Europe was formed by history and the United States was formed by philosophy.'' And there really is something to that. We were founded on the basis of people coming together. And of course at the Constitutional Convention they couldn't come up with a constitution, the Articles of Confederation had all fallen apart, no common currency, it just didn't work, too loose of a web. And so they came together 4 years later, 1787, in the Constitutional Convention, and for merely 5 weeks couldn't agree on anything. And that's when the very elderly Benjamin Franklin gave his speech, that during the war in the early days, they never let a day go by without prayer, and they saw prayer answered. And so he made the motion that they begin each day with prayer, and that began. And now, all of a sudden we're able to come together with all these different philosophers through the ages and come up with what was the Constitution. Amazing. But they had seen the New Testament practice early in the church, when they had everybody bring everything into a common storehouse and gave out equally. And that eventually results, as it always has to, when people see someone else is not working as hard as they are and they're getting an equal share, then they quit working and everything falls part. That led to the Apostle Paul coming around and saying, If you don't work, you don't eat. At Jamestown, we saw where the pilgrims tried the same thing. And then we saw in the Soviet Union--and you've got to give it to the Soviet Union, they made it 70 years under that premise, that you could bring everything into a common storehouse and give out equally, and they made it 70 years. That's got to be a record for that. But here, they're wanting to take this government in the biggest socialist step in the history of the western hemisphere, $700 billion; and we're supposed to be comforted because our government may be able to make a profit on the taxpayers' money. The trouble is, government never makes the kind of profit that individuals could, and the government is not supposed to be in the business of making a profit. That is free enterprise. That's what we were founded on. And, you know, I heard this quote years ago, I don't remember who said it, if they were quoting someone else, but especially since I've been in Congress I've found it to be true. And it may very well be true in this situation, it sure seems to be, because we've got people on Wall Street who are screaming, you have got to come in with this infusion of $700 billion of taxpayer money to bail out the banks. What is that going to do? As I understand it, it's going to buy mortgage- based securities--at a rate above where they may even be marked down to--and save those people that have stock in that bank, the officers that got them in that trouble, and that will keep their stock from being worthless. And the quote that I was alluding to is this, ``Hell hath no fury like a vested interest masquerading as a moral principle.'' And boy, have we been hearing that. ``You can't let the country fall.'' ``You can't let this panic ensue.'' We were told Friday, a week ago, 8 days ago, if we didn't have a deal by Monday, then the banks were going to start falling and it would be a domino and we would never get it back. It didn't happen. Some of us wanted to be more cautious. But anyway, as I heard the gentleman say earlier, if the majority, if the Speaker wants to pass a bill, she sure doesn't need us. And I heard Madam Speaker say just earlier today on the news that it was very unpatriotic for the Republicans not rushing in sooner to be part of this $700 billion bailout discussion. And that was really striking because they didn't ask for our input when they ran in here and crammed down a non-energy energy bill that didn't allow any amendments. They didn't need our votes. They were going to cram it down the Nation's throat and tell them we gave them energy when there was not a drop of energy ever going to come from it. And then shortly thereafter the majority leader said, oh, one of the first orders of business, we'll put the moratorium back. So they don't need us, really, to pass a bill. And another thing that I haven't heard talked about in these mortgage-based securities is actually who those are. Now, at one end-- and people don't want to talk about this--but at one end you've got people who thought if they could run in, get a no-money-down mortgage on a house that was a lot more than they could afford--when it was $1 million or $2 million or half a million--more than they could afford and they could hold it for a year, they could turn it, double their money, they never had to make a payment, and wow, they just doubled the value of the home and then came away with all this cash. When the house didn't double, then they had been in the house for a year and hadn't made a payment, didn't pay anything down--as the saying goes, ``no skin in the game''--and now we're supposed to bail them out? That's at one end. In the middle, we have people who were really legitimately hurt, and not so much of their own accord. They knew what kind of house they wanted to look at. They were talked into, by bankers or realtors that shouldn't have, into buying more than they could afford. They got a mortgage that they really couldn't afford, thinking the house would greatly be enhanced in value and they would come out ahead. And they're truly suffering, and my heart goes out to them. Then the other thing--and I haven't heard anybody talk about it on the floor here--but as it turns out, there are apparently a lot of illegal aliens who got mortgages. Because I know I had seen Bank of America advertising that they wanted to help the aliens, and under certain circumstances, gosh, we can get you a mortgage. So we're going to bail out mortgages for illegal aliens. Let me tell you, back in the eighties, when the FDIC and RTC had taken over so many banks, what we saw was people come in and say, you know, I've been making my payment every month, and I'd like to negotiate a better deal. And they were told, well, heck no, you keep making your payments. I mean, I did outside counsel work for the RTC and FDIC. You would have some people come in later and say, okay, you wouldn't work with me before when I was making my payment every month, now I haven't paid for 6 months and they say, okay, now we'll work with you. We're sending the wrong message. And it is so critical that we not come out of this Chamber with a bill that hurts the America that we know and love so much. There have to be consequences. And it troubles me much that the administration, the Secretary Treasurer has been forecasting this gloom and doom; ``there's going to be widespread panic.'' ``If Washington Mutual goes down it will be a domino and we will not stop the depression.'' Normally, it's the administration saying, nobody panic, we're going to get through this, this will all be okay, just stay with us, let's have faith in each other. And instead, all we're hearing is ``you've got to do something immediately or it's all going to fall apart.'' Well, it seems like, if you allow me to borrow from Kipling's poem and paraphrase a little bit, if you can keep your head while all those about you are losing theirs, you're probably the reason they're losing theirs. And that's what we seem to be seeing around here. I appreciate the time and Mr. Garrett yielding. And I will yield back.

Mr. GOHMERT

Mr. GOHMERT. Would the gentleman be willing to engage in a colloquy?

Mr. GOHMERT. I appreciate the input, the insights. This deals with the energy issue, but it deals with the financial crisis in America. As the gentleman alluded to, this has helped contribute to a perfect storm in America for a financial crisis. But we are not hearing people on the other side of the aisle, and we haven't heard Secretary Paulson say, you know what, that kind of infusion of wealth could really boost the country, and then you wouldn't have to worry about bailing out the greediest among us that were on Wall Street and drove some companies into the dirt. Instead, what we have heard is we have got to spend $700 billion to build this governmental entity that will start managing assets. Now, I think the world of the President. I think history is going to be good to him. He is an honorable, noble man. The biggest problem he has I think is what Jeff Foxworthy says about people that speak with a southern accent; people hear the accent and immediately deduct 50 IQ points from how smart they think you are. He is much smarter than people give him credit for. But he has listened to people like Secretary Paulson and others who have told him it is all gloom or all doom, and then has come before us and he said last night only the Federal Government could be patient enough to manage these assets. I immediately thought, in the Resources Committee 2 years ago, in the last Congress, we put in a biomass incentive program where we would incentivize people to help create this alternative energy source. People bought into that, like we wanted them to, and they started building biomass plants. And when they are about to come on line, this Congress in the Resources Committee comes back and knocks that out. They say, no, we are not going to do that incentive program anymore. We are going to spend several million dollars to study, to see whether it is really feasible. Of course it was feasible. People relied on the government's promise that they would have an incentive, and then we yanked it out from under them. So when I hear somebody say how patient the Federal Government is, we can't even keep the same tax incentives in place for 2 years so that people can take advantage of them. They know they would have trouble trusting the Federal Government. Then I can also tell you as former outside counsel for the RTC and FDIC, I can't go into individual cases, but it is public knowledge and you can talk to anybody who ever dealt with the RTC or FDIC, when people knew the government owned an asset and they were needing to sell it, even if they could sit on it for a number of years, they always knew if the government owns it, we can pay less and get away with paying less than if a private entity owned it. They knew that. The same way, if the government was going to buy it, they knew they should hold up the Federal Government, because eventually they would get what they want, and that is just the way it works. The private sector is the better place. We have had some people who were greedy and ran these things into the ground. This Congress previously, as Congressman Frank and Senator Dodd, forced requirements on lending that caused them to make loans to people that couldn't repay them. We have had questions arise now as to potentially many of those loans may have been to illegal aliens, or, as they say in Great Britain, irregular migrants. But there is an accountability issue, and Congress has not done a good job of holding these people accountable, and that needs to start. I am working on a bill, and some people are not real crazy about it, but there needs to be accountability. In the public sector, publicly traded businesses, there is a concept in contract law called the corporate veil. So if you are acting as an officer of a corporation and you commit some act of negligence, the corporation can be sued, but not pierce the corporate veil to go after the officer because he was acting on behalf of the corporation, unless you could prove he was acting outside that course and scope with the corporation. Then you might pursue him personally. I would like to see if an officer makes decisions that a reasonable and prudent officer would not have made under the same or similar circumstances, and it is one of the or a proximate cause towards the demise, the bankruptcy, the insolvency of the corporation that is publicly traded, then perhaps there should be no corporate shield, and in the bankruptcy court the bankruptcy judge could look at the assets of that officer and make a determination legally, was this negligence, was it a proximate cause for the insolvency or bankruptcy, and, if so, let's bring those millions back you got from your golden parachute and put them back in the employee pension fund or to help some of the debts that you ran up before you left them high and dry. There are things we can do. I am not getting a lot of traction on talking to friends on that, but, who knows? We may get them back. We heard this morning that China banks have been told by their government not to make loans, one-day loans to U.S. banks, because they are concerned about their solvency. It is amazing that China would need to teach us a lesson about capitalism. But I do thank my friend from Illinois. I appreciate your participation and insights into energy, because it is such a huge part of the solution to our financial crisis. So I thank you. I was intrigued when a number of our Members went over to China 3 years ago. We talked to a number of CEOs about why you moved your company, why you moved your facilities, your plant, to China. I figured the answer would be solely, well, it was just cheap labor. But the number one reason was that their corporate tax was half of what our corporate tax is in the United States. Then not only that, but China was willing to negotiate even lower taxes for a period of time to incentivize their coming to China. Then you talk to them further, China has had some very polluted bodies of water, some of them were told if you will come and set your factory up on this body of water that's totally polluted, start using the water from that body, put it back clean, then we will cut you a better deal on corporate tax, and that it was well worth it for them to take advantage of that. So China was using corporations to help clean up their environment that they had made such a mess. Having been an exchange student to the Soviet Union back in 1973, I am quite familiar with the fact that over there, any money that was paid was supposed to go into the Federal Government. That was socialism. Then everybody got a check got a check from this central government. That's how socialism worked. I didn't realize, until I went to China, they don't do it that way. The Chinese do have a totalitarian government, and it's cause for great concern, but they have also noticed that in Hong Kong, and around the country, if you incentivize entrepreneurship and just take a part of that success, you make a whole lot more money than if you just make everybody bring in to the central coffers and then split it up equally. That didn't work in the New Testament, when the New Testament Church tried. It ultimately resulted in the Apostle Paul saying, if you don't work, you don't eat. It didn't work when the pilgrims did it. When they came to America they had a compact that they just bring into the central storehouse and then divided up equally. But then that ended up causing people, pilgrims, to notice, well, I am killing myself working here, and he is not working as hard I am, and he is getting the same amount, so they quit working. I will never forget going to a collective farm, outside of Kiev, and I spoke just enough Russian back in those days when I could ask a question. I was intrigued because it was midmorning, around 10 a.m. or so, and there were a bunch of farmers sitting around in the shade. I asked, you know, when do you work? Anybody that's worked on a farm back in east Texas or in west, anywhere in Texas, knows if you are going to work out there, you get up early, and you do everything you can as early as you can, because it starts getting hot. It was the same way there. I said, when do you work in Russia, and they laughed. One of the men, and I am not sure how many rubles he said, but he said, I make the same number of rubles if I am here in the shade or out there in the sun, so I am here in the shade. That's why socialism doesn't work, and that's why, when we had this proposal from Secretary Paulson to have the government seize this massive amount of assets and then manage them for years and years, we could see this is the biggest step towards socialism that we could have ever imagined in this country, couldn't believe it was being proposed by our administration. It's still unbelievable to me. We know the principles. As I have said before, I started making speeches in junior high and in debates in high school talking about the free market and entrepreneurship. If you set the American spirit free, it's amazing what they could do. Now they want to come in and have me say that that was all a lie? I don't believe it was a lie. I believe the government makes sure everybody has a level playing field, punish the wrongdoers, punish the evildoers, but then keep that level field available out there to play on, and then let entrepreneurship reign. That's the best way to go. That's not what's proposed here, so there was a bunch of others. We had a plan that we proposed in the Republican Study Committee that would cut capital gains, cut income tax or anybody that will come in and buy these assets. Boy, you think about that, we would stir up the market, get them excited about coming in and making money. It would be fantastic. We wouldn't have to create this huge bureaucracy to do that. It just comes back again to the USSR that lasted 70 years, because it was doomed to failure, couldn't stand, versus the free market. You look at Ireland. I was talking to somebody from Ireland, and I understood them to say their corporate tax was 12 percent, China 17 percent, we are double that. France and Germany saw the way Ireland has become, I believe, the fourth fastest-growing country in the world, as companies are flocking in there, more jobs, better standard of living. France and Germany, who had been tending towards socialism are now realizing, whoa, if we will just cut our taxes, then people will flock into here like they are into Ireland and like they have been into China to do business. Now, I appreciated my friend, Mr. McCotter, pointing out that Secretary Paulson could end up with a piece of paper, he was hoping to come away from their discussions today, come out, wave a piece of paper in front of the cameras, say we have this agreement, and this means fleece in our time, because Americans taxpayers would not be well served. I appreciate my time is about to expire, and I appreciate the time tonight to talk about these issues, but there has got to be accountability. I believe you will have full cooperation in making people fully accountable on both sides of the aisle, but let's don't turn $700 billion of the economy over to the government. Let's incentivize good conduct. Let's incentivize the free market at work because socialism doesn't. I yield back and appreciate this opportunity.

Mr. GOHMERT. Looking at the map that the gentleman from Illinois had prepared, it is ironic to me. Like up in New England, we see the area that is off limits for drilling. Well, it is not that New Englanders are against drilling the Outer Continental Shelf. In fact, apparently they are 100 percent for it, as long as it moves up the coast just a little bit and our friends from Canada drill right off of their part of the coast. Then our friends from Canada, as the gentleman has indicated, are gracious enough to pop it back down and sell it to us. Now, I don't know if those sands under the Outer Continental Shelf are such that those formations, that pool is actually draining some of our oil that they are selling back to us, or our gas and selling it back to us. But if so, that is awfully gracious of them to do so, to sell us back some of our own oil and gas. Then we have people saying under no circumstances whatsoever do we ever want any drilling done less than 50 miles off our coast. Well, you look at Florida, the map that you have got there, you see Cuba, they are 90 miles from the Florida coast, which nowadays under international law most countries claim 200 miles out, except where you share an area like that, in which case you split it. So now Cuba is being kind enough to other countries, whether it is Russia, China, Venezuela, to allow them to come drill within 50 miles of the Florida coast, and, who knows, maybe they will be willing to sell us back some of our own oil and gas too for an appropriate profit going to those countries. But how ironic. They say they are against it, but it is not really being against it. It is just in our little backyard area. I was amazed as the gentleman was talking about the arguments that have been made for some months, and I have got to say, I thank the gentleman from Illinois, Mr. Shimkus, who has been the leader on this issue and been terrific about it. John Peterson from Pennsylvania, we are going to miss him. He has been a great leader in discussing energy. But as we talked about it through August, Ralph Regula came and spoke one day on the floor without the mikes and with the lights dimmed. I did not know until Mr. Regula pointed it out, he was on Resources back in 1981, and, of course, President Carter had signed an executive order. And in that order, and Ralph had that as well, he had said that the Outer Continental Shelf was such a vast great resource for energy for America, and the two words that stuck in my mind in President Carter's order was that it should be ``developed expeditiously.'' Well, according to Ralph, they got lobbied in 1981 by wealthy beachfront property owners on the California coast. They didn't want to see a platform out there within their sunset. They lobbied hard and eventually they won. Okay, we will give California a moratorium on drilling off their coast. According to Ralph, immediately Florida beachfront landowners, the wealthy, not the poor and the downtrodden, not the hardest working in America, but the wealthy beachfront property owners, and I am proud of them, I am glad they are able to do that, they came rushing in. Wait a minute, you gave a moratorium to the wealthy beachfront property owners in California. We need to have one in Florida. So, they lobbied hard enough, had the wherewithal, the money to do a good job lobbying, and they got a moratorium. And Ralph said, he said when they gave the moratorium to California, the committee will rue the day we ever did it, because that was 27 years ago. Then Florida got theirs. Then other States started coming in and saying, you gave it to California and Florida, we ought to get one too. That is where that came from. Of course, in Texas, pretty pragmatic, we heard lots of horror stories. If you put platforms out there, it will kill all the aquatic life. You will never get another shrimp or fish out of the gulf. Lo and behold, we have the platforms out there. They withstood category 5 hurricanes as far as not leaking. Some of them were destroyed, but they still didn't leak. And I kind of thought it looked pretty, you know. The sun sets, and out there you start seeing lights twinkling on the horizon, it is platforms. I know I am getting energy from it, and it is a whole lot better than having tankers come along and leak. I was amazed, and that came because of the discussion we had with the lights dimmed, the microphones off, and Ralph Regula giving us a little bit of history.

Mr. GOHMERT

Mr. GOHMERT. Madam Speaker, I move that the House do now adjourn.