Marcy Kaptur

Ms. KAPTUR

Ms. KAPTUR. Madam Speaker, this was an amazing day in the Congress of the United States. The American people were actually heard, and fear was put on the shelf as we stopped hasty action that Wall Street powerhouses had attempted to ram through this Congress. It was a sobering day. It was an exhausting day. Now we have to get to work to create a new moment: to draft legislation on a bipartisan basis that is responsible, that is rigorous and that meets the real needs. This includes securities and exchange reform legislation to expand credit flows. The SEC and bank regulators must act immediately to suspend the fair value accounting rules; they must clamp down on abuses by short sellers, and they must withdraw the Basel II capital rules. These will go a long way to expanding credit flows at the local level. We have to stabilize our housing markets on Main Street, and we have to reform the regulatory process and investigate the wrongdoers who brought America and the American people to this juncture. We have to fund the FBI to go after those who have exhibited malfeasance, accounting fraud, who have used abusive practices, and who have made billions doing it. I want to thank the American people and this Congress for doing what was right, not what was hasty. Regulating Wall Street (By William M. Isaac) The Fed's decision to open the discount window to Wall Street firms, and to subsidize the takeover of Bear Stearns, requires that we rethink the regulation of Wall Street. How we resolve the issues will have profound effect on our financial markets for years to come. Before attempting to come up with answers, we need to make sure we know and understand the questions. I will try to identify the important ones. A. Who Gets Access to the Safety Net? Under What Circumstances? What Price Do They Pay? The federal safety net (i.e., the ability to borrow from the Fed and to offer insured deposits) was created to promote stability in the banking and thrift industries, and the cost is borne by banks and thrifts. The deposit insurance fund now exceeds $50 billion, and each year the Fed pays to the Treasury billions of dollars of profits earned in part from interest-free reserves maintained by banks. If we expand the safety net, which firms should be included--investment banks, hedge funds, leveraged buyout firms, insurance companies, others? How will we draw the line--size of firm, inter-connections to other firms, harm a failure would cause to consumers or businesses, the potential impact of a failure on financial stability? If non-banks are granted access to the safety net, will they be required to help pay cost? Would it be fair to banks and thrifts to have invested billions per year in the safety net for much of the past century to suddenly allow non-banks to obtain the benefits of the safety net? What would be the competitive effects on banks and thrifts? B. Who Will Regulate Our New Universe of Safety Net Firms? Treasury argues that we need to revamp the regulation of financial firms in view of the new world of finance in which commercial banks, thrifts, investment banks, insurance companies, and others perform many of the same functions. It is suggested that we need to consolidate the regulators while designating a single ``market stability'' regulator. I would argue that the genius of the American system of government is the diffusion of government power. We do not believe in centralized planning, and we rely heavily on checks and balances. One of the clearest lessons of the S&L crisis of the 1980s is that we must have an independent deposit insurance agency armed with the full array of examination and enforcement powers. The former FSLIC, which insured deposits at S&Ls, was a toothless agency operating as a subsidiary of the primary regulator. The failure to provide that check on the S&L industry was an important contributing factor to a taxpayer loss of some $150 billion. Are we prepared to go down that path again in our pursuit of a tidy organizational chart? We currently have at least four agencies heavily focused on maintaining stability in the financial markets--the Fed, the SEC, the FDIC, and Treasury. Do we really believe that having a single agency fretting about market stability will be an improvement? If so, which agency has been proven to have such all-knowing vision and wisdom? The major problem confronting our financial system for the past year is the collapse in the residential real estate markets. Did the banking agencies and Treasury not notice that unregulated mortgage loan brokers were sprouting up everywhere, that securitizations were providing unprecedented liquidity to mortgage markets, that home loan underwriting standards were deteriorating, and that home prices were skyrocketing? Did the agencies seek more information or take actions to dampen the frenzy, were they rebuffed, or did they not appreciate the potential problems? Take a look at the public debate while the real estate bubble was building. You will find the Fed and Treasury touting the Basel II capital regime as the way to make more precise calculations of how much capital was really required in our banks. It was argued that this would allow our large banks to reduce their capital to international norms, or about half the U.S. level. Does that sound like folks who were concerned in the slightest about a bubble in real estate? Thankfully, the FDIC, the OTS, and a few Congressional leaders fought against eliminating the minimum capital requirement for U.S. banks. As bad as things might be right now, how much worse they would be if Basel II had breezed through without a minimum capital standard and our major banks had leveraged their balance sheets even further during the past few years? One final question to ponder as we debate our future: Would we be better served by a messy, contentious, and some times frustrating regulatory system that moves cautiously or by a highly efficient system that runs with alacrity off the nearest cliff? Would it be more appropriate to legislate that non-banks develop and pay for their own safety net? Should we impose new standards to reduce greatly the odds that non-banks will ever need to use the safety net again? Might it be appropriate to enact tough ground rules restricting the ability of the Fed to lend to non-bank firms in the absence of a national emergency? Should the Fed be allowed to act unilaterally? If non-bank firms are included in the bank-funded safety net, what sort of regulation will we impose on them? Will it be equivalent to the regulation of banks, i.e., capital regulation, liquidity requirements, examinations, reporting requirements, compliance regulations, limitations on loans to affiliates and officers and directors, restrictions on ownership and permissible activities, lending limits, and a full range of regulatory enforcement powers? If non-bank firms are included in the bank-funded safety net and then fail, how will the failures be handled? Will they be subject to the receivership powers of the FDIC? If not, who will administer the receivership? Do we want our central bank providing liquidity and also handling failures? We used to have a comparable system in the S&L industry with disastrous results. If we go down the path of comparable regulation of commercial banks and investment banks, will investment banks be able to continue their high-risk underwriting and investment activities so vital to capitalism? If not, will they remain in the U.S. or move their headquarters to London or Dubai?

Ms. KAPTUR

Ms. KAPTUR. Madam Speaker, in thanking my colleague, Congressman Gohmert, for all of his efforts to make this institution function in the manner that it was duly constituted to function, I was reminded today, as I was walking through the halls--not expecting the result that was just yielded on that important vote relating to Wall Street-- there is a fresco downstairs, and above the door it has this quote, that ``Here there are no temples but the Capitol, and no oracle but the Constitution.'' No matter how powerful any group is or any set of individuals, our duty is a different one, and that is, to work together across this aisle for the best legislation, the best law making that is humanly possible to serve the people that sent us here, through regular order. And that means hearing from the membership, especially on a matter of such extraordinary magnitude as we were just asked to vote upon. This is the Congress of the United States, and we are a deliberative body. We are not a military order. There are no generals, and they are not able to command down the ranks. We operate through consensus. And when that process breaks down, we don't produce good legislation and, in turn, do not serve the American people. On the matter that was before us, I think it's fair to say that most committees that should have met did not. They were discharged of their duties in a strange process that I hope I never see again. The bill came to the floor with a closed rule. A few Members said to us after the vote, ``Well, where is your alternative? If you don't like this, where is your alternative?'' And our answer was, we had alternatives, but we were summarily denied the ability to present them through regular order. There was no reason to go to the Rules Committee, as it was a closed rule. We were not allowed to invite witnesses--and many of us asked, it's not like we didn't try. But let the record be very clear, Members were not able to testify, and therefore, we were not able to glean the best intelligence from our country as this bill moved forward. ``There is no temple but the Capitol, and no oracle but the Constitution.'' I really believe this Congress met its duty, its sworn obligation today in this truly historic vote. We have a lot of work to do. And I think one thing happened today that is actually very good for the Republic, and that is, whatever artificial line may exist down that middle aisle, I think it crumbled, and there is a new working energy inside this institution to do what should have been done in the first place. Now, we have respect for our leadership, and we have respect for the President of the United States. And whatever was presented a few weeks ago that had to be acted upon with such urgency, we are willing to remain and to reconstitute ourselves and to exercise the duties of the office to which we have been elected as our constitution demands. People don't have to be fearful, Wall Street doesn't have to be worried, we can take care of this. If we look to some of the institutions that have run up into a little trouble these last few weeks, we've seen what the FDIC has done. The insurance programs are working. Savings deposits are safe in our institutions. One can argue whether we should increase the FDIC-insured rate over $100,000 per depositor, but if we do this right, we can really give strength back to our credit markets because this is not a liquidity crisis, this is a credit crisis related to accounting standards. We can hear from the best accountants in America. That should have been done. They could have helped us work through this; they were not given voice. We can take a look at the housing crisis, its foreclosure crisis--which is at the heart of the credit seize-up--because we have markets that aren't working there, we have a lot of empty properties, people being foreclosed. There was nothing in this legislation that would do workouts at the local level. Why didn't the Federal Reserve, you know, and the administration, they wanted all this money, but they didn't want money to help Main Street bankers and mortgage holders and families try to work out loans at the local level where we can save people in their homes. My goodness. These are issues America has dealt with before. There should be calm across the country. The Congress has made a decision, and I believe that we will present a better bill in a very short period of time. I thank you, Madam Speaker. And what a joy it was to work with Members on both sides of the aisle to do what was right, not what was fast.

Ms. KAPTUR

Ms. KAPTUR. I thank the able Chairman Barney Frank for yielding me this time, and say America needs the right deal, not a fast deal. This Congress must step up to its constitutional responsibilities as a deliberative body to craft that right deal, not an insider trade. Actually, this bill is the wrong medicine. It concentrates financial power even more in the hands of Wall Street's mega banks and its buddies at the U.S. Treasury. It bails out their bad behavior with no reform to prevent further abuse, and it ignores Main Street's real housing challenges. There is a much better way. The Bush administration says we are facing the worst financial crisis in modern history. That is not true. The market problems of the 1980s were much worse than today. Then, over 3,000 banks failed, interest rates were 21 percent, and all the banks in Texas went down. The economic instability was resolved by the financial system in a much more disciplined and rigorous way than taxpayers printing money for Wall Street. In those days the FDIC, not through a taxpayer bailout, but through careful use of FDIC's considerable power, resolved thousands of problem situations. No cash changed hands. The FDIC used its powers, its regular powers to regulate transactions with banks through a system of subordinated debentures and promissory notes. Even curbs on executive salaries and controlled dividends were exacted through that process. The cost of the entire enterprise was $1.8 billion, resolving over $100 billion in problem institutions from the FDIC insurance fund, paid for by the banks, not the taxpayers. Today's economic challenge is a credit and housing crisis, not a liquidity crisis, precipitated by SEC accounting rules that are rewarding high-risk speculators and penalizing sound banks. Mr. Chairman, I say we go back to the drawing board. This bill does not do it for the American people. Draft the right deal, not the fast deal. Draft the best deal. [From moneynews.newsmax.com, June 3, 2008] Isaac: Banking Crisis? What Banking Crisis? The former chairman of the Federal Deposit Insurance Corp., William M. Isaac, says the current turmoil in financial markets is not remotely comparable to the Great Depression. He disputes even the notion of a crisis. ``If there is a banking crisis, I have seen no evidence of it. I can count on my fingers and toes every sizeable bank about which I have had any concern during the past year,'' Isaac wrote recently in The Wall Street Journal. By comparison, Isaac says, during the 1980s and early 1990s, the U.S. suffered from 4,000 bank and savings and loan failures. There were still more than 1,430 banks on the FDIC's ``problem list'' by the end of 1991. ``I'm sure the problem banks list will grow during the next year, but it totaled only 76 at last count,'' Isaac says. ``Banks continue to have incredible access to the capital markets and over 99 percent of banks are considered well- capitalized by regulators.'' Additionally, Isaac says, a 20 percent decline in housing prices was not really all that big of a deal economically for the U.S. The widely cited S&P/Case-Shiller home-price index declined 14.4 percent in March from a year earlier. The gauge has fallen every month since January 2007. Isaac notes that in Sarasota, Fla., where he resides, housing prices increased by 35 percent in one year alone, in 2005. Isaac argues that such a rate of increase is ``unsustainable'' and was ``pushing housing prices beyond the reach of most people.'' Why is all this happening now? Politics, says Isaac. Americans have been ``spoiled'' by 25 consecutive years of prosperity and, during this year's election cycle, one in which a Democrat has a chance to take over the White House, ``roughly half of the population wants us to feel angst,'' he writes. Some economic experts agree with Isaac's assessment of the banking industry. ``Asset bubbles result in the misallocation of capital, which adversely affects economic growth,'' Donald P. Gould, president of Gould Asset Management, tells Moneynews. ``Probably it is safer to let the market undo its own bubble.'' Federal intervention in the market could result in a deflationary period just like that seen in Japan during the 1990s. ``Witness what happened when the Bank of Japan pierced the Japanese real estate bubble,'' says Gould. ``A decade-plus of recession.'' Ken Kamen, president of Mercadien Asset Management, tells Moneynews that an overreaction is not needed, as, ultimately, ``market forces will decide where money needs to be.''

Ms. KAPTUR

Ms. KAPTUR. With the highest regard for the chairwoman of the Rules Committee, I rise, regrettably, in opposition to this closed rule and against the bailout bill. We need the right deal, not a fast deal. The White House is counting on fear to propel this Congress into hasty and inappropriate action on a Wall Street bailout that is not in the interest of our Republic. There is a better way. In fact, it is as likely the expenditure of $700 billion will actually stand in the way of the most effective means to remedy the economic challenges facing us. The Bush administration says we are facing the worst financial crisis in modern history. That is not true. The market problems of the 1980s were much worse than today. Then, 3,000 banks failed; interest rates were at 21 percent; money center banks went down; every bank in Texas went down. But the economic instability was resolved in the financial system in a much more disciplined and rigorous way than taxpayers printing money for Wall Street. In those days, the FDIC, not through a taxpayer bailout, but through careful use of FDIC's considerable power, resolved thousands of problem situations. No cash changed hands. A system of net worth certificates issued by FDIC was used to get through the credit shortage. FDIC regulated transactions with banks, through a system of subordinated debentures and promissory notes, was enacted. FDIC assumed power over executive salaries and controlled dividends to restore health and rigor to the market. The FDIC adopted a contingency plan to nationalize all institutions in the event it was necessary. The cost of the entire enterprise was $1.8 billion, resolving over $100 billion in problem institutions from the FDIC insurance fund, paid for by the banks, not the taxpayers. In other words, the market was used to heal the market, not set up a big government bureaucracy at the U.S. Treasury, run and overseen by the very reckless people who caused these problems in the first place. Today's economic challenge is a credit crisis, not a liquidity crisis. This bill does not address that. The housing bubble that burst is at the heart of our dilemma. Until Main Street housing foreclosures are remedied, the situation will not improve. This bill does not address the serious mortgage workout and mortgage servicing challenges facing Main Streets across this Nation. Taking a trillion dollars of taxpayer money and buying bushels of unknown and unvalued paper is not smart. It will delay resolution of that housing crisis. In fact, this bill actually asks taxpayers to buy a garbage truckload of worthless paper, everything from subprime auto loans, to foreign bank loans, to hedge fund paper, to credit swaps. Every reckless Wall Street deal thought up these past several years they want to dump on us. We say: No. Now, this bill also does nothing for reform, for example, to address the shortcomings of the SEC, which has done more than any other regulatory body to cause this problem by its false accounting, overinflated leverage ratios, and by destroying fair value accounting.

Ms. KAPTUR. I thank the gentleman for yielding me--very, very much. The SEC must be a major part of the solution. This bill does not do it. Finally, Mr. Speaker, before one cent is even considered, this Congress first ought to pass a bill to create and fund an independent Emergency Financial Crimes Unit to investigate the malfeasance, securities fraud, false accounting, and insider trading that were the root causes of this extravagance that must now be resolved in a rigorous and thoughtful manner. This bill does not do it. Draft the right deal, not a fast deal. I thank the gentlelady and the gentleman for yielding.

Ms. KAPTUR

Ms. KAPTUR. Mr. Speaker, my message to the American people: Don't let Congress seal this Wall Street deal. High financial crimes have been committed. Now Congress is being asked to bail out the culprits and to do so at the expense of those who elected us to guard their interests--the people of our country. The normal legislative process that should accompany the review of a monumental proposal to bail out Wall Street has been shelved--yes, shelved. Only a few insiders are doing the dealing. It sounds like insider trading to me. These criminals have so much political power that they can shut down the normal legislative process of the highest law-making body in this land. All of the committees that should be scanning every word of what is being negotiated are benched, and that means the American people are benched, too. We are constitutionally sworn to protect and to defend this Republic against all enemies, foreign and domestic. My friends, there are enemies. We are told we will have a bill, a $1 trillion bill, to review soon, and will have less than 24 hours with no regular hearings to try to vote on this bramblebush. The people pushing this deal are the very same ones who were responsible for the implosion on Wall Street. They were fraudulent then and they're fraudulent now. We should say ``no'' to this deal. I ask my colleagues to join us at 2 o'clock in HC-8 of the Capitol to meet with some real experts who have done financial resolutions without putting the burden on the taxpayer. Please join us in HC-8 at 2 p.m.

Ms. KAPTUR

Ms. KAPTUR. Madam Speaker, Ohio, Michigan and the rest of the Great Lakes have a resource that is the envy of any nation. With 20 percent of the world's available freshwater, the regions water resource represents the key for economic and environmental sustainability. Gone are the days when we can take this resource for granted and trust that the rest of the world will not tread on us. My district spans 90 plus miles of coastline across Lake Erie and depends on the natural bounty of the Great Lakes. The Great Lakes Compact represents a paradox. On the one hand the time for action is clearly upon us, however, while this legislation represents a starting point, the loophole that allows the export of bottled water outside the basin puts the entire agreement in jeopardy. While the States have been reviewing this compact for years, Congress spent less than 20 legislative days examining this legislation. I am particularly concerned about the binding effect of S.J. Res. 45 and its broad exemption for bottled water. What will be the bills effects on our trade agreements? I cannot honestly answer that point. How many bottled water companies will be eligible to apply for this exemption removal? No one knows. What opportunities will there be to update or amend the legislation? No one can truly say. According to the legislation, a--``Diversion means a transfer of Water from the Basin into another watershed, or from the watershed of one of the Great Lakes into that of another by any means of transfer, including but not limited to a pipeline, canal, tunnel, aqueduct, channel, modification of the direction of a water course, a tanker ship, tanker truck or rail tanker . . . '' However, this legislation continues to describe a glaring loophole in the following: ``but does not apply to Water that is used in the Basin or a Great Lake watershed to manufacture or produce a Product that is then transferred out of the Basin or watershed. Divert has a corresponding meaning''. In section 4.12, this legislation allows the bulk water transfer so long as it is packaged in containers of less than 5.7 gallons or less. The legislation goes on to provide authority for jurisdictions to determine the treatment of Proposals to Withdraw Water and to remove it from the Basin in any container of 5.7 gallons or less. This provision to allow the regulated transfer of bottled water must not be misused and will be Congresses job to ensure that this does not happen. While I will vote against the Great Lakes compact today, I do not do so out of opposition to the base legislation but in an effort to slow down its consideration. Once this bill is signed into law, the story is not over. Congress must continue to use its legislative authority to ensure that the compact is implemented as intended. With strong oversight, this body must ensure that the provisions of the compact are used to protect the Great Lakes. Hopefully, this legislation is a starting point. It is the first step in protecting our water resource but it must not be our last. While I encourage a no vote on the final legislation, I do so to ensure that these concerns are clearly presented for the record.

Ms. KAPTUR

Ms. KAPTUR. I thank the gentleman very much for yielding. In order of seniority, I would like to say to the dean of the delegation, Ralph Regula, there are many memories, perhaps not legislative, that I take with me relating to your service. One is your discussions about your red truck, and you were so happy when you bought it. Of course, Congressman Regula, being a farmer and I suppose some would say an Ohio rancher, you know, men really never grow up. He loved that little truck. He drove it in the garage downstairs. It was always shiny. He was really proud of it. He used to drive it back to Ohio. I remember one time I came down the hallway in the Rayburn Building, and he was kind of coming out of his office. I said, Ralph, what's wrong, and he had been kicked by a cow over the weekend. I guess he was kind of repairing himself there. I thought, well, that's the first Member I have met who was kicked by a cow. I remember when I first arrived, you and your lovely wife Mary were friends with Doug and Betty Applegate. That's when I first got to Congress. That was a great moment. We used to have those fashion shows wearing U.S.-made clothing which has become almost nonexistent, which is another story. But there were annual fashion shows, and Mary and Ralph and Betty and Doug would welcome us into that. It was really great to do that and to begin to focus attention in America on the issue of trade and jobs, which has become so much of the challenge that we face today. I can remember, in our committee, Ralph holding the gavel of his subcommittee and being asked by the Chairs, and then when he was Chair himself, calling for the committee to adjourn after various votes had been taken and the high regard, right up at the top. I mean, he moved all the way up from the last seat all the way up to the first seat on that dais, and I always see them there. I think from Mary I will remember Mary in Canton with the Mary Todd Lincoln gown and hat. I think I will always remember what a great, great moment that was, what a great gift to America you have given just in that one, in that one place of such historical significance that we will keep building forward. For Deborah Pryce, I will say I shall always remember her as the, I believe, first woman Chair of her caucus, and very few women. I think when Deborah got here, there couldn't have been over 30 women in the House, maybe, it wasn't very much. So for her to ascend and to plow a path for her daughter, and for the women of the future, was just so wonderful, and to be able to share that moment and to watch that happen, and the great pressure that is placed on someone in that position, and how she handled it so ably and always with great dispatch. I remember her as a new mother and trying to handle motherhood as well as that enormous responsibility, and she did it, her great dedication to cancer research, pediatric cancer research and the contribution she made for all children in this country, and to find better answers in that terribly, terribly important area of health care. Also, our participation in a prayer group here in the Capitol, and the friendships and the camaraderie that came from that, those are moments that you never, never forget. For Dave Hobson, obviously, you know, he loves this place, he loves being a lawmaker. I don't know what he is going to do after this. But, energy and water, that was his thing. He traveled all over the country, all over the world. He knew every general in the Army Corps of Engineers, I think, by first name, and loved helping build things for America. When I think of armored Humvees, I will always think of Dave Hobson. I don't know if any other American will, but I will always associate armored Humvees and up-armored Humvees with Dave. His dedication to nuclear power, safe nuclear power, no one could have tried harder, studied that issue harder and made a difference than Dave Hobson. He has that certain sparkle in his eye that former Representative and Speaker pro tempore, Barney Coulter, would identify with very, very much and for the great work that Dave contributed, not just here, but in our State legislature, to help building the Medical College of Ohio at Toledo. Our people will always be eternally grateful. So to each of them from our side of the aisle, we extend deepest, deepest gratitude, and Godspeed in the years ahead. May you be given good health. May you have more time to spend with your families, and may there be less pressure and more joy in the days ahead. It has been a real privilege to serve with each of you.

Ms. KAPTUR. I thank the gentleman for yielding, and am very pleased to join Congressman LaTourette in paying warm, warm appreciation and thank-you's, gratitude, so many memories, to our beautiful colleagues Ralph Regula and Deborah Pryce, and I don't know whether Dave Hobson would want me to call him beautiful or not, but I guess I can. He has a beautiful soul. These are moments that are very hard, because all those years come crowding in on you. For each one of these wonderful, wonderful Members I will at the right time this evening share some personal recollections. With their eventual departure from here, Ohio will lose over 50 years of seniority. That is a staggering figure. And it isn't just the years, it is the friendships, the experience, the respect with which each of them is held, and the wonderful give-and-take that comes from getting to know Members well across the aisle. I thank each of them on behalf of the people of our State for the major portion of their lives that they have given to this institution and for every single success that they have had legislatively here, that has helped build a better America and a better Ohio, and I thank them for their personal integrity throughout, carrying that torch forward for our great Buckeye State. There are many others that wish to speak, and I will reserve at this time, but I just want to say I thank Ralph for your friendship. I thank Mary for hers, for all we have worked on together, including the First Ladies' Library, for all of the park systems all over this country, all of our great work on Appropriations. Those are memories that I will always have. To Deborah Pryce, one of the few women from the Ohio delegation actually, all the years we have spent here together, and her kindness and her strength under leadership pressures here, as well as family pressures. She was strong and a survivor, and really a role model for us all. And certainly to Dave Hobson, who has this uncanny habit of just being able to weave in and out down all these aisles in this place, and he always seems to know where you are, he finds you in the back in the cloakroom or wherever, and all of our great work on Appropriations together, and his desire to reach across the aisle and to work with us, whether it was defense, whether it was energy, whether it was education, health care. We are really going to miss you all, each of you. I just thank you for being a friend to me while I have been able to serve here. And I thank Congressman LaTourette for giving me a moment here to place a few words on the Record. I shall remain throughout this hour. Thank you.

Ms. KAPTUR

Ms. KAPTUR. Madam Speaker, I would like to place in the Record the measuring sticks against which I will weigh any proposal brought before this Congress to bail out Wall Street investment houses. Number one, financial reform must come first. America needs reform, not a bailout. Over the last 20 years, legislation has been passed by this Congress, H.R. 1278 in 1989 called FIRREA, interstate banking in 1994 which created those big mega banks, and H.R. 10/S. 900 in 1999, which overturned the Glass-Steagall Act that allowed banking, real estate and insurance all to be under the roof of the same firm. Well all those bills together have created a highly concentrated financial system, particularly in housing finance, rather than a decentralized one like that which we had for most of the 20th century. This bailout is the result of high-risk misbehavior by distant financial giants. They have sucked equity out of local communities and turned local markets into derivative, debt-ridden communities rather than independent, robust, credit markets with prudent savings and lending practices. Reform should restore those prudent and transparent banking practices defining the difference between banks and investment houses and protecting and restoring the protections that existed prior to 1999 when that Glass-Steagall Act was eliminated. Conflicts of interest at bond rating agencies should be addressed by such agencies becoming public. Reform, as I say, and regulation should come first out the door before the money, not later. Number two, Main Street housing market deflation must be stabilized as step one. A moratorium should be placed on all home foreclosures for 120 days. That will take us into the new year. And deflation in the housing market really is what has triggered this credit crunch. The Federal Reserve could use its influence through its regionalized structure to bring parties together to work out affected loans in places like Ohio to stabilize local real estate and housing markets. That is where the real assets are and where the markets must clear and adjust. What a crime it would be if people are thrown out of their homes and an institution somewhere over in England like Barclays becomes the owner of those assets and gets them at fire-sale prices. We need to put those assets back in the hands of the American people. The traditional home loan backed by savings deposits was converted into a bond during the 1990s and then securitized into those international markets. The time-tested loan standards of character, collateral and collectibility were shelved, and therefore to reform this system it must be decentralized again, with the community savings and home loan bank system being reestablished with an emphasis on increasing savings deposits with enhanced local mortgage origination and oversight, as opposed to concentration of activity in Wall Street investment houses. Number three, a new Financial Assets Management Board should be formed to manage this mortgage refinancing and workouts at the local level, similar to FDR's Homeowner Loan Corporation. Fourth, the Department of Justice should be authorized to investigate the wrongdoers, to track down the fraud, misrepresentation of asset value, insider trading and related crimes in this scandal. There should be over 500 attorneys and accountants and support staff to conduct thorough investigations, forensic accounting and prosecution. Fifth, any Federal dollar that is expended must result in equity to our taxpayers. If our people are going to be forced to fund unlimited private sector bad debt, our people must receive an equity share in every Wall Street financial company proportional to the amount of bad debt held that is shifted to the taxpayer. Our people are being asked to take 100 percent of the risk. They should be afforded the benefit of any future profits. A 0.25 percent transaction fee should be charged on every Wall Street trade or Chicago Board of Trade transaction, and that $150 billion a year that will be yielded should pay the American people back over time. Sixth, a select congressional committee should be established to hold hearings, do proper oversight and advise the next President and Congress on mortgage and financial recovery operations and additional means to assure any necessary repayment of public investment. Seven, standards for executives and compensation structure in the financial services industry should be established. Those outlandish salaries that they get should be curbed, and all bonuses, stock options and exceptional compensation for those individuals and their boards of directors should be discouraged. We should help to pay the bill by going after some of their assets. Finally, Madam Speaker, I would like to place this in the Record, and also include bankruptcy reform as one of the major changes that we need to make in any measure. These are the steps that would actually result in market recovery, not just bailing out unknown assets and bad debts from Wall Street. Kaptur: Real Reform or Nothing--Financial Reform Must Come First America needs real financial reform first, not a bailout. Over the last 20 years, legislation passed by Congress (HR 1278 in 1989, HR 3841 in 1994, and HR 10/S 900 in 1999) has highly concentrated financial activities on Wall Street-- particularly housing finance--rather than decentralized them. This bailout is the result of high risk misbehavior by distant financial giants. They have sucked equity out of local communities and turned local markets into derivative, debt-ridden communities rather than independent robust credit markets with prudent savings and lending practices. Such reform should restore prudent and transparent banking practices. Reform of the deregulated financial structure should start with defining the difference between banks and investment houses and restoring protection that existed prior to 1999 when the Glass-Steagall Act was eliminated. Each should have defined activities and be regulated separately. Conflicts of interest at bond rating agencies should be addressed by such agencies becoming public. Reform and regulation should come first, not later. Franklin Delano Roosevelt invented the basic framework that served America well for the last century. Congress should adapt it to current challenges on a Jeffersonian model, not the proposed Hamiltonian approach. main street housing market deflation must be stabilized as step one Legislation should mandate a moratorium on all home foreclosures for 120 days. Deflation in the housing market has triggered this credit crunch. The Federal Reserve must use its influence through its regionalized structure to bring parties together to work out affected loans to stabilize local real estate and housing markets. That is where the real assets are and where the market must clear and adjust. Before the Federal Reserve and Treasury, or its consultants, can foreclose upon any home, it must first certify under criminal penalty that a workout was attempted with the mortgage. A workout certification on every home will be required. Additionally, a 120-day moratorium will drastically reduce the amount of capital needed. Otherwise, millions more of our citizens will be foreclosed and financial giants like Barclay's will pick up local real estate at fire sale prices. The cowboy banking that accelerated in the last 20 years concentrated financial power on Wall Street and huge regional mega-banks. The traditional home loan, backed by savings deposits, was converted into a bond that was securitized into international markets. The time tested loan standards of character, collateral, and collectibility were shelved. They must be restored. To reform the system, it must be decentralized, with the community savings and home loan bank system being reestablished, with an emphasis on increasing savings deposits, enhanced local mortgage origination and oversight, as opposed to concentration of activity in Wall Street investment houses. These local institutions should be empowered to do workouts and supported through any housing finance provided. The federal incentives for savings and home loan institutions, as existed pre-FIRREA, should be restored. In a letter to Congress the CEO of BB&T states, ``The primary beneficiaries of the proposed rescue are Goldman Sachs and Morgan Stanley.'' This is essentially unfair and improperly focused. Attention must be placed on restoring value to local housing real estate markets. a new financial assets management board should be formed to manage mortgage refinancing and workouts (similar to fdr's home owner loan corporation) Board Members: Secretary of Treasury, Federal Reserve Chairman, Comptroller General of the United States, Appointees of House Speaker, House Minority Leader, Senate Majority Leader, and Senate Minority Leader, Appointee from the States Attorneys General, U.S. Attorney General. Department of Justice Should Be Authorized to Investigate Creation of a Special Prosecutor position at the U.S. Department of Justice with authority and adequate funding to track down the fraud, misrepresentation of asset value, insider trading, and related crimes in this scandal. Funds should be allocated to hire 500 or more attorneys and accountants and support staff to conduct thorough investigation, forensic accounting, and prosecution. Recovery of assets fraudulently or illegally obtained by individuals, Boards of Directors, and institutions involved shall be required retroactive to the decade of the 1990s to the present. equity to taxpayers must be mandated If U.S. taxpayers are forced to fund unlimited private sector bad debt, they must receive an equity share in every Wall Street financial company proportional to the amount of bad debt held that is shifted to the government. Since taxpayers are assuming 100 percent of the risk, they should be afforded the benefit of any future profits. Those profits should be placed in a special lock box account for Social Security. The trustee should be restrained to investments in AAA state and local bonds. Taxpayers who have been up-do-date on home mortgage payments but who will be required to help fund the bailout should be afforded lower interest rates on their existing home mortgages to total the amount being borrowed from them. A .25 percent transaction fee should be charged on every Wall Street or Chicago Board of Trade transaction and the funds yielded should be used to pay back the loan for U.S. taxpayers, this fee will yield about $150 billion annually. a select congressional committee should be established A cross-jurisdictional Select Committee of Congress should be established in both chambers to hold hearings, do proper oversight, and advise the next Congress and President on mortgage and financial recovery operations and additional means to assure any necessary repayment of the public investment. standards for executives and compensation structure in the financial services industry established Compensation for financial executives at all levels should be limited to five year rolling average, made public on a quarterly basis, similar to Securities and Exchange Commission filings. Alternatively, compensation for top executives at financial houses should not exceed the salary of the President of the United States until such time as the federal government recovers or receives repayment for any financing that may be provided. Anyone who had major responsibility for buying or selling these junk bonds should be permanently banned from holding any position in any company dealing with financing of any sort. All bonuses, stock options, and exceptional compensation (present and post for 10 years) for those individuals and their Boards of Directors should be disgorged. This should be a responsibility of the Department of Justice's investigations. Since executives and Boards of Directors were paid for fraudulent transactions and likely insider trading, their earnings were assumed under false pretenses. New leverage ratios should be devised and incorporated with this law, probably 10:1, not 30:1. Anyone or any company involved in leveraging or selling any sub-par mortgages involved in the bailout should be banned from employment by Treasury to help in these workouts. Secretary Paulson and all political appointees in the U.S. Treasury and the Federal Reserve should be required to renew their public disclosure statements as circumstances have changed since their original filings. All financial institutions and executives that will benefit from this bailout in any way should be banned from making any political contributions this election cycle and during the 111th Congress. Additional Financial System Reporting and Transparency Requirements Must be Required The Financial industry, including hedge funds, shall comply with new regulations involving disclosure, capital requirements, conflicts of interest, and market manipulation. All hedge funds must immediately disclose holdings. Hedge fund profits must be taxed at the sane rate as other financial corporations, their current rate is 15% on current income with a capital gains rate of only 5%. Consumer credit debt must be reported quarterly to assure Congress has complete information on market conditions that may impact future solvency. The source of the bailout money must be explicitly identified as well as the costs and nature of the financing agreement. If foreign nations, banks, or sovereign wealth funds provide monies, and trade or defense concessions are inherent in the agreement, Congress shall require certification from Treasury and the Federal Reserve that no side deals were transacted as a part of the agreement. A provision should be included that if such side deals of any kind that may be implied or thought to exist, the United States is not bound by it. As part of the legislation, the Secretary of Treasury and the Federal Reserve Chairman are required to provide a statement as to how the arrangement will be executed in order to avoid fueling inflation and rising interest rates. Bankruptcy Reform Bankruptcy law should be changed to give bankruptcy judges the authority to: Reset primary mortgages during personal bankruptcies; and Release credit card holder from that debt in personal bankruptcy. Our nation, our taxpayers, and our communities need real reform or nothing.

Ms. KAPTUR

Ms. KAPTUR. Mr. Speaker, I would like to place in the Record remarks that I made in 1999 regarding a measure called the Gramm-Leach-Bliley bill that passed in this Congress on a vote of 362-57. At the time we said it would cause the mess we're facing today on Wall Street and indeed it has. I will place also in the Record the votes of those who were present voting ``yes'' and voting ``no.'' This is an extraordinarily important vote that essentially unharnessed Wall Street to do whatever it wanted, mixing banking, commerce, real estate, insurance in a way America had not done for over half a century. Some of what I said at that time was, ``I would say to the people listening tonight, are you tired of calling banks and getting lost in the automated phone system, never locating a breathing human being? This bill will make it worse. ``Are you fed up with rising ATM fees and service fees that now average over $200 a year per account holder? This bill will make it worse. ``Are you tired of mega-financial conglomerates and mergers that have made your community a branch economy of financial centers located far away whose officers you never know who never come to your community? This bill will make it worse.'' I would urge my colleagues to take a look at the remarks that were made over a decade ago and think about what we are facing today. I commend all of my colleagues who voted ``no'' in those days. They deserve a badge of honor. Ms. KAPTUR. Madam Speaker, I rise in opposition to the rule and in opposition, strong opposition, to the bill. This bill is pro megabank and it is against consumers. And I would say to the people listening tonight, Are you tired of calling banks and getting lost in the automated phone system, never locating a breathing human being? This bill will make it worse. Are you fed up with rising ATM fees and service fees that now average over $200 a year per account holder? This bill will make it worse. Are you skeptical about banks that used to be dedicated to safety and soundness and savings but are now switching to pushing stocks and insurance and debt? This bill will make it worse. Are you tired of the megafinancial conglomerates and mergers that have made your community a branch economy of financial centers located far away, whose officers you never know, who never come to your community? This bill will make it worse. Punitive reporting requirements in this bill are aimed at disabling community groups that are the only groups in this country that hold these institutions accountable for the depositors' money. It is going to make them a target of Federal reporting requirements. So why do community groups oppose this bill, like the Lutheran Office for Governmental Affairs, the Fair Housing Alliance, the National Low-Income Housing Coalition, the Coalition of Community Development Financial Institutions, Consumers Union, the Volunteers of America? Sounds like the folks that live in my neighborhood, my colleagues. I would say this is one of the worst conceived bills ever to come before this body, simply because it does not pay attention to the majority of the American people who have, on average, less than $2,000 in any financial institution in this country. To anyone listening tonight I say, Put your money in the credit unions. They are owned by you and they will take care of you. Vote against this bill.

Ms. KAPTUR

Ms. KAPTUR. I thank the gentleman for yielding. Since you mentioned the State of Ohio, I thought I should just state for the record that the vast numbers of people in our State do not favor the extension of NAFTA to Colombia. Indeed, the entire Catholic and Christian communities as well or other organized against this agreement because of the horrendous treatment of Afro-Colombians on the northwestern side of Colombia, as well as the massive killing of labor leaders, the largest number in the world, more than all other countries, combined. So we place human life first, and I just wanted to thank the gentleman, but I don't think you should use the State of Ohio in your argument about Colombia trade. I thank you for yielding to me.

Ms. KAPTUR. Will the gentleman yield?

Ms. KAPTUR

Ms. KAPTUR. Mr. Speaker, I have some advice for President Bush and Secretary Paulson, and that is--hold your horses. The Wall Street credit crunch is not the fault of the American taxpayer. In fact, 94 percent of the American people are paying their mortgages on time. The credit crunch has been created by an unregulated global financial market with some pretty important players. They sure have a lot more money than our family does. This mess extends far beyond Wall Street. The co-conspirators include the central banks in China, Saudi Arabia, South Korea, and Japan. These institutions all around the world who fully understood they were buying pieces of paper held by people who lacked the ability to pay, but they wanted access to our markets to sell their goods, and they bought our debt securities to assure our government wouldn't stand tall for fair trade. They played a form of financial musical chairs, so to speak, hoping that when the music stopped, they would not be penalized. Well, the music has stopped, and they don't want to pay the penalty. They want a bailout. The American people for two decades have opposed the NAFTA-type trade deals that these financial houses have supported that have caused so many catastrophic losses of jobs as industries were outsourced, communities devastated, and our national wealth harmed. The American people are not to blame for that. They're frustrated with that. Rather, it is the stewards in these financial houses, the folks over in this Bush administration, that want to extend NAFTA to Colombia now and the Federal Reserve and Treasury who fail to do their fiduciary duties. You know, there's a lot of history here. If we think about where the seeds were planted that caused this mess in the markets, you can go back to 1989 with the passage by this Congress of the Financial Institutions Reform, Recovery and Enforcement Act. I voted ``no'' on that bill because what it did was it placed all of these troubled savings and loans back then that had bad paper right on the books of the American taxpayer. We paid over $250 billion for all of those mistakes, and that bill established a Resolution Trust Corporation which executed a lot of very lucrative deals to dispose of those failed thrifts, including one called in the consolidation, post- RTC, Superior Bank, which, by 2001, after getting all of the tax breaks that it got, ended up getting the largest fine in American history ever imposed by the FDIC: $450 million for its wrongdoing. That particular Act in 1989 also diminished the role of community savings banks that had been so important in our country. That Act also took the regulatory harness off the Wall Street high-steppers, and they began to get very, very careless. The RTC savings and loan failures ultimately have cost the American people so much that we're still paying interest on the messes from the 1980s. Now they want to add more. Then in 1994, Congress passed--and I voted against--the Interstate Banking Act that basically allowed these financial institutions to get even bigger and less community-oriented. Give us no money on our passbook savings and charge us fees just if we have money in checking accounts. They have made billions. I remember in 1995 when Speaker Newt Gingrich was elected, and he went down to the Banking Committee and took the name off the door. It used to be Banking, Finance and Urban Affairs, and he changed it to Financial Services; and oh, boy, have they been about doing that, putting fees on everything, practically even breathing when you walk in a bank. So the whole idea of prudent banking was thrown out the window, and the time-honored principles of character, collateral, and collectibility were thrown out. Then in 1999 the killer bill of all, Gramm-Leach-Bliley, was passed by this Congress, and it gutted the Glass-Steagall Act that had been there since the Great Depression. That Act passed this Congress by a margin of 362-57, and that repeal enabled commercial lenders like Citigroup, the largest U.S. bank by assets, to underwrite and trade instruments such as mortgage-backed securities and collateralized debt obligations in the international market for the first time in American history. The repeal of that Act is one of the major contributing factors to the subprime mortgage crisis that we face. Nontransparent practices like derivatives crept in, and it was even hard to define what a bank was anymore as loans were then changed to be bonds and then bonds became securitized debt and then securitized debt was sold into the international market. And who in the world even knows where your mortgage lies. Today, we have, as a Congress, the duty to reform the system, prosecute those responsible, and protect our taxpayers. Mr. Speaker, might I just say, in closing, America doesn't need $700 billion for Wall Street. We need 500 more lawyers and accountants at the FBI going after these people, not as a symbolic force, but as a real force, to go after and recover the money from all the mansions, Mercedes, boats, stock options, and offshore tax havens that these people have set in place. This is a problem that this Congress has to solve. Please support my bills, H.R. 6990 and H.R. 1452, to set America on a more prudent and diligent course in our banking and financial system.

Ms. KAPTUR

Ms. KAPTUR. Mr. Speaker, Congress is being pushed to pass a Bush administration plan to write a blank check to white collar criminals of the highest order. Instead of prosecuting those who stole from us, Secretary Paulson wants us to reward his former colleagues for their bad decisions, abusive and unlawful practices. While my constituents are struggling to pay their gas bills, we should recall fondly the record annual bonuses Secretary Paulson's alma mater, Goldman Sachs, gave less than 2 years ago. In 2006, that investment house alone paid $16.5 billion in compensation to its employees averaging more than $600,000 per employee. In fact, Goldman CEO Lloyd Blankfein got $53.4 million that year. And Bear Stearns chief executive officer, the company that the Fed just bailed out with our money, James E. Cayne, got a stock bonus that year worth $14.8 million. Merrill Lynch chief executive officer Stanley O'Neal, he got $35.4 million. Think about this America. Now 2 years later, those houses are demanding that our taxpayers bail out their companies, despite the fact that the real median household income of a middle class family in our country is about $50,000 a year. That doesn't matter to the people drafting this bailout. In 2006, Forbes Magazine estimated Secretary Paulson earned $16.4 million as CEO of Goldman Sachs, not counting all his other perks. His net worth is estimated somewhere over half a billion dollars. Indeed, that tidy amount alone would make a real dent in what is owed to the American people in this proposed bailout. So why would our middle class taxpayers be asked to bail out billionaires? Some of them should be doing time for insider trading and fraudulent accounting rather than lobbying down here in Washington for us to bail them out. American taxpayers were forced to lay out $30 billion to help Bear Stearns. And then we were asked to shell out the first $200 billion, and that could rise to $2.44 trillion, for Fannie Mae and Freddie Mac. And now, $85 billion to rescue AIG Insurance Company. Who ever heard of the Federal Government rescuing an insurance company that was already paying, get this, civil fines in New York for its wrongdoing of over $1.6 billion on proven charges of serious accounting fraud and misconduct. Why send our hardened paychecks to the very people who caused these problems? Americans don't need to write checks. We need investigations, and we don't need just investigations, we need prosecutions. White collar crimes of this magnitude cannot go unpunished, nor can they get rewarded. First, investigation. We need the American people's voices to be heard, not just the voices of those who perpetrated these crimes against us, the taxpayers. We need real congressional investigation and oversight in each of the committees of jurisdiction which seem strangely silent here, using their subpoena power, the Judiciary Committee, the Ways and Means Committee, the Energy and Commerce Committee, the Budget Committee, the Financial Services Committee, which is having a perfunctory hearing tomorrow, I guess, and Government Oversight. The silence is deadening. The crimes of Wall Street will make Watergate look like penny-ante thieves. Second, campaign reform. Get the Wall Street money out of congressional and presidential races. Wall Street is now the Number 1 top source of Federal campaign money to Congress and in those presidential races. And guess who's the Number 1 Wall Street giver? Goldman Sachs. And guess where our last two Treasury Secretaries have come from? Goldman Sachs. Whether it's a Democratic administration or a Republican, not one lawmaker or candidate should be accepting Wall Street money. Wall Street is so broke as to beg for our help, but somehow they have millions of dollars to drop into political coffers. I think the American people are beginning to get the picture. In fact, I'm putting in the Record tonight an article from the Wall Street Journal called Wall Street Top Source of Campaign Money, and also a list of the biggest donors on Wall Street. Mr. Speaker, I will continue tomorrow evening to talk about justice and empowering the Department of Justice to institute a major investigation. And let me also, in closing say, I'm going to be placing in the Record tonight some remarks from Americans who have ideas about what should be done. I want to compliment the American people. You're doing a lot of thinking on your own. We need to hear from you. This Congress shouldn't be closing down and going home. We should be taking care of America's business, not going home to campaign. [From the Wall Street Journal, Jan. 23, 2008] Wall Street Is Top Source of Campaign Cash Wallets Open Up on Wall Street (By Brody Mullins) Despite Wall Street's recent woes, people who work in the financial industry continue to dig deep for political donations to Republican and Democratic candidates for president. Employees of Wall Street firms are the single largest source of campaign cash, accounting for a total of $50.4 million in financial contributions to the candidates so far this election cycle. That is more than any other industry sector, according to a Wall Street Journal analysis of campaign-finance data compiled by the nonpartisan Center for Responsive Politics. As candidates load up for advertising blitzes before ``Super Tuesday'' primaries on Feb. 5, candidates from both parties are again coming to New York seeking campaign donations. Sen. John McCain, the Arizona Republican, had a fund-raiser at the St. Regis Hotel last night that was hosted by Merrill Lynch & Co. Chief Executive John Thain, private- equity giant Henry Kravis of Kohlberg Kravis Roberts & Co. and former Goldman Sachs Group Inc. Chairman John Whitehead. Mr. McCain recently spent $1 million on advertising ahead of the Florida primary next Tuesday, Voters in more than 20 states, including California and New York, go to the polls Feb. 5. New York Sen. Hillary Clinton heads to her home state tomorrow for two fund-raisers. The Clinton campaign hopes to raise $15 million through these and other means to fund her campaign through Feb. 5. Contributions from Wall Street have favored Republicans, who have collected 54% of donations from financial companies. Wall Street is the No. 1 source of donations to every major presidential candidate in both parties, except former North Carolina Democratic Sen. John Edwards, who is favored by the legal industry, according to the data. Lawyers and lobbyists are the second-largest source of contributions to the candidates, with $34.8 million in donations. Together, the finance and legal industries are responsible for nearly a quarter of the $354 million donated to the presidential candidates as of Sept. 30. The next round of campaign-finance information, covering the three-month period ending Dec. 31. will be released at the end of the month. Employees of financial firms, lawyers and lobbyists make up 46% of all large donations--contributions of $200 or more--to the presidential candidates. Each of the other industry sectors is responsible for just a fraction of the donations to the candidates. According to the data, people who work in Hollywood, communications or electronics rank a distant third with $13.3 million in donations to the candidates. Other top sources of donations were employees of the health-care industry with $9.5 million, construction with $6.1 million and energy with $3.1 million. People who work in the defense industry gave $502,000, according to the data. Not surprisingly, the two candidates from New York are winning the race for donations on Wall Street. Mrs. Clinton and former New York City Republican Mayor Rudy Giuliani lead with $12.3 million and $10.6 million, respectively, in campaign donations from employees of Wall Street firms Employees of Goldman Sachs, Lehman Brothers Holdings Inc. and Morgan Stanley rank as the top individual sources of donations to the presidential candidates, according to the data. Goldman employees were the largest contributor to Mr. Obama, the second-largest giver to Mrs. Clinton and the fifth-largest to Mr. Edwards. Goldman employees donated $369,000 to Mr. Obama and $350,000 to Mrs. Clinton. Other top Wall Street givers to Mr. Obama include employees of Lehman Brothers ($229,000), J.P. Morgan Chase & Co. ($217,000) and Citigroup Inc. ($181,000). The top seven companies that have produced the most money for Mr. Giuliani are all financial firms, including Ernst & Young LLP, hedge fund Elliott Management and Credit Suisse Group. Former Massachusetts Gov. Mitt Romney also has fared well on Wall Street. A founder of Bain Capital, Mr. Romney has scored with employees of Goldman Sachs, Merrill Lynch and Morgan Stanley. Employees of his former company have donated $112,000 to his campaign, according to the data. Unlike Wall Street, lawyers heavily favor Democrats with their political donations. Lawyers have donated $9.6 million to Mrs. Clinton, $8.2 million to Mr. Edwards and $7.9 million to Mr. Obama. Mr. Giuliani, a former prosecutor and partner with Bracewell & Giuliani LLP, raised $3.2 million from others in his profession. That was more than any other Republican but less than half as much as the leading Democratic candidates. Pennsylvania-based law firm Blank Rome LLP was the top source of donations to Mr. McCain, who collected $141,000 from employees of the firm. Mr. McCain fared well with employees of Greenberg Traurig LLP, a Miami firm that ranks as his third-largest contributor. As the chairman of the Senate Indian Affairs Committee, Mr. McCain took the lead in investigating convicted lobbyist Jack Abramoff, who was a lobbyist with Greenberg Traurig. Mr. McCain and Mrs. Clinton led all others with donations from lobbyists. Mrs. Clinton collected $568,000 from lobbyists, while Mr. McCain has $340,000.

Ms. KAPTUR

Ms. KAPTUR. Mr. Speaker, here is the latest reality game. Let's play Wall Street Bailout. Rule one: Rush the decision. Time the game to fall in the week before Congress is set to adjourn and just 6 weeks before an historic election so your opponents will be preoccupied, pressured, distracted, and in a hurry. Rule two: Disarm the public through fear. Warn that the entire global financial system will collapse and the world will fall into another Great Depression. Control the media enough to ensure that the public will not notice this. Bailout will indebt them for generations, taking from them trillions of dollars they earned and deserve to keep. Rule three: Control the playing field and set the rules. Hide from the public and most of the Congress just who is arranging this deal. Communicate with the public through leaks to media insiders. Limit any open congressional hearings. Communicate with Congress via private teleconferencing calls. Heighten political anxiety by contacting each political party separately. Treat Members of Congress condescendingly, telling them that the matter is so complex that they must rely on those few insiders who really do know what's going on. Rule four: Divert attention and keep people confused. Manage the news cycle so Congress and the public have no time to examine who destroyed the prudent banking system that served America so well for 60 years after the financial meltdown of the 1920s. Rule five: Always keep in mind the goal is to privatize gains to a few and socialize loss to the many. For 30 years in one financial scandal after another, Wall Street game masters have kept billions of dollars of their gain and shifted their losses to American taxpayers. Once this bailout is in place, the greed game will begin again. But I have a counter-game. It's called Wall Street Reckoning. Congress shouldn't go home to campaign. It should put America's accounts in order. To Wall Street insiders, it says ``no'' on behalf of the American people. You have perpetrated the greatest financial crimes ever on this American republic. You think you can get by with it because you are extraordinarily wealthy and the largest contributors to both Presidential and congressional campaigns in both major parties, but you are about to be brought under firm control. First, America doesn't need to bail you out, it needs to secure the real assets and property, not your paper, that means the homes and properties of hardworking Americans who are about to lose their homes because of your mortgage greed. There should be a new job for regional Federal Reserve Banks. We want no home foreclosed if a serious work-out agreement can be put into place. And if you don't do it, we want a notarized statement by a Federal Reserve official that they tried and failed. Second, taxpayers should directly gain any equity benefits that may flow from this historic bailout. We want the American people to get first priority in taking ownership of the institutions that want to pass their toxic paper onto the taxpayers. Third, before any bailouts for Wall Street, America needs major job creation to rebuild our major infrastructure. America needs assets, not paper. We need working assets. Fourth, the time for real financial regulatory change is now, not next year. A modernized Glass Eagle Act must be put in place. We need to reestablish locally-owned community savings banks across this country and create within the Justice Department a fully funded unit to prosecute every single high-flying thief whose fraud and criminal acts created this debacle and then forced their disgorgement of assets going back 15 years. Fifth, any refinancing must return a major share of profits to a new Social Security and Medicare lockbox, where the monies can go to pay for a dignified and assured retirement for every American. This Member isn't voting for a penny of it. Those who created and profited from this game of games must be brought to justice. The assets they stole must be returned to the American taxpayers, right down to the tires on their Mercedes. Mr. Speaker, I ask my colleagues to join me in cosponsoring my bill to create an independent commission to investigate these well-heeled wrongdoers. Real reform now, or nothing. Seven Deadly Sins of Deregulation--and Three Necessary Reforms (By Robert Kuttner) The current carnage on Wall Street, with dire spillover effects on Main Street, is the result of a failed ideology-- the idea that financial markets could regulate themselves. Serial deregulation fed on itself. Deliberate repeal of regulations became entangled with failure to carry out laws still on the books. Corruption mingled with simple incompetence. And though the ideology was largely Republican, it was abetted by Wall Street Democrats. Why regulate? As we have seen ever since the sub-prime market blew up in the summer of 2007, government cannot stand by when a financial crash threatens to turn into a general depression--even a government like the Bush administration that fervently believes in free markets. But if government must act to contain wider damage when large banks fail, then it is obliged to act to prevent damage from occurring in the first place. Otherwise, the result is what economists term ``moral hazard''--an invitation to take excessive risks. Government, under Franklin Roosevelt, got serious about regulating financial markets after the first cycle of financial bubble and economic ruin in the 1920s. Then, as now, the abuses were complex in their detail but very simple in their essence. They included the sale of complex securities packaged in deceptive and misleading ways; far too much borrowing to finance speculative investments; and gross conflicts of interest on the part of insiders who stood to profit from flim-flams. When the speculative bubble burst in 1929, sellers overwhelmed buyers, many investors were wiped out, and the system of credit contracted, choking the rest of the economy. In the 1930s, the Roosevelt administration acted to prevent a repetition of the ruinous 1920s. Commercial banks were separated from investment banks, so that bankers could not prosper by underwriting bogus securities and foisting them on retail customers. Leverage was limited in order to rein in speculation with borrowed money. Investment banks, stock exchanges, and companies that publicly traded stocks were required to disclose more information to investors. Pyramid schemes and conflicts of interest were limited. The system worked very nicely until the 1970s--when financial innovators devised end-runs around the regulated system, and regulators stopped keeping up with them. Seven Deadly Sins Sin One: Allowing Mortgage Lending to Become a Casino. Until 1969, Fannie Mae was part of the government. Mortgage lenders were tightly regulated. Homeownership rates soared throughout the postwar era, from about 44 percent on the eve of World War II to 64 percent by the mid-1960s. Nobody in the mortgage business got filthy rich, and hardly anyone lost money. Fannie's job was to buy mortgages from banks and thrift institutions, to replenish their money to make mortgages, and along the way to set standards. Fannie financed its operations by selling bonds. In the late 1970s, private Wall Street firms started emulating Fannie. They packaged mortgages, and converted them into bonds. Over time, their standards deteriorated, because they could make more money creating riskier products. In order to avoid losing market share, Fannie emulated some of the same abuses. Government did not step in to regulate the affair--which was a time bomb waiting for the creation of the sub-prime mortgage business. Sin Two: Allowing Unregulated Bond Rating Agencies to Decide What was Safe. Sub-prime is only the best known of a widespread fad known as ``securitization.'' The idea is to turn loans into bonds. Bonds are given ratings by private companies that have official government recognition, such as Moody's and Standard and Poors, but no government regulation. These rating agencies have become thoroughly corrupted by conflicts of interest. If you want to package and sell bonds backed by risky loans, you go to a bond-rating agency and pay it a hefty fee. In return, the agency helps you manipulate the bond so that it qualifies for a triple-A rating, even if the underlying loans include many that are high-risk. Without the collusion of the bond-rating agencies, sub-prime lending never would have gotten off the ground, because it would not have found a mass market. Had regulators looked inside this black box, they would have shut it down. They might have needed new legislation, but they never asked for it. And public-minded regulators might have done a lot under existing law, since banks (which are regulated) were heavily implicated in the financing of sub-prime. Sin Three: Failing to Police Sub-prime. The core idea of bank regulation is that government inspectors periodically examine the quality of bank assets. If too large a portion of a bank's loan portfolio is behind in its interest payments, the bank is made to raise more capital as a cushion against losses. Problems are nipped in the bud. But complex securities require more sophisticated regulation than simple loans. Regulators basically waived the rule on adequate capital for the new wave of mortgage lenders who created sub- prime. Many mortgage companies were not banks. They made loans only to sell them off to the Wall Street sinners of Deadly Sin No. 1 (see above). So there was no loan portfolio to examine, and no real capital. The Democratic Congress anticipated this problem in 1994, when it passed the Homeownership Opportunity and Equity Protection Act. This prescient law required the Federal Reserve to regulate the loan-origination standards of mortgage companies that were not otherwise government-regulated. But Alan Greenspan, a free-market zealot, never implemented the law. And when Republicans took over Congress in 1995, they never called him on the carpet. Sin Four: Failure to Stop Excess Leverage. The financial economy is crashing today because so much speculation was done with borrowed money. A typical leverage ratio of a hedge fund or private equity company is 30 to one. That means $30 of debt for $1 of actual capital. If you make one serious miscalculation, you are out of business. And in the case of sub-prime mortgage companies, the leverage ratio was infinite, because they had no capital. The game was entirely based on creating debt. As long as times were good, financial firms could keep borrowing to finance their deals. But once investors looked down, they panicked. Some parts of the system are unregulated, such as hedge funds and private- equity companies. But they all ultimately get a lot of their funding from banks. And regulators do retain the power to look closely at banks' books (see Sin No. 3 above). Had they used that power to police the kind of highly risky stuff banks were underwriting they could have shut it down. Sin Five: Failure to Police Conflicts of Interest. Remember the accounting scandals of the 1990s? In those scandals, accounting firms were paid once to audit corporate books and then again to help clients cook the books and still pass muster with the audit. That was a sheer conflict of interest. Though accountants were (loosely) regulated, Congress did not crack down until cooked books caused the stock market to crash. A second conflict of interest was the corruption of stock analysts, who were telling customers to buy dubious stocks because their bosses were profiting from underwriting the same stocks. In the aftermath of the dot-com bust, Congress narrowly cracked down on these two abuses with the Sarbanes-Oxley Act but simply ignored others--such as the role of bond-rating agencies and the habit of basing executive bonuses on stock prices that could easily be manipulated by the same executives. Sin Six: Failing to Regulate Hedge Funds and Private Equity. When Roosevelt's New Deal acted to rein in the abuses in financial markets, it regulated the major players-- commercial banks, investment banks, stock brokers, holding companies, and stock exchanges. But two of the biggest purveyors of risk today--hedge funds and private-equity firms--simply did not exist. Today, private-equity firms and hedge funds do most of the things banks and investment banks do. They basically create credit by making markets in exotic securities. They buy and sell firms. They speculate in financial markets with borrowed money, taking much bigger risks than regulated banks. According to House Banking Committee Chair Barney Frank, more than half the credit created in recent years has been created by essentially unregulated institutions. The people in charge of the government--conservative Republicans--took the view that these new-wave financial players offered transactions between consenting adults who needed no special consumer protection. But they were oblivious to the risks to the larger system. Sin Seven: Repeal of the Glass-Steagall Act. This action, in 1999, was one of two major cases when a cornerstone of New Deal regulation was explicitly repealed. (The other was the repeal of the Public Utility Holding Company Act, and if your utility rates are sky-high, you can thank Congress for that, too.) Glass-Steagall provided that if you wanted to speculate as an investment bank, good luck to you. But commercial banks were part of the banking system. They created credit. They were regulated, supervised, usually enjoyed FDIC insurance, and had access to advances from the Fed in emergencies. So commercial banks and investment banks were two different creatures that should stay out of each other's knitting. But beginning in the 1980s, regulators who didn't believe in regulation either allowed explicit waivers of some aspects of Glass-Steagall or looked the other way as commercial banks and investment banks became more alike. By 1999, when Citigroup had jumped the gun and assembled a supermarket that included a commercial bank, investment bank, stock brokerage, and insurance company, Glass Steagall was so hollowed out that it was effectively dead. The coup de grace was its official repeal, in the Gramm-Leach-Bliley Act. That's Gramm as in former Sen. Phil Gramm, a deregulation zealot and top adviser to John McCain. Three Basic Reforms What all of these sins had in common was that they led financial markets to misprice assets. In plain English, that means buyers were purchasing securities based on bad information, often with borrowed money. When firms started losing money on sub-prime in mid-2007 and other owners decided it was time to get their money out, the whole miracle of leverage went into reverse. And it spilled over into other securities that had been mispriced thanks to all the conflicts of interest tolerated by regulators. That's why, no matter how much taxpayer money the Federal Reserve and the Treasury keep pumping in, they can't turn dross back into gold. The next administration and the Congress need to return the financial economy to its historic task of supplying capital to the real economy--of connecting investors to entrepreneurs--and shut down the purely casino aspects of the system that have only enriched middlemen and passed along huge risks to everyone else. Reform One: If it Quacks Like a Bank, Regulate it Like a Bank. Barack Obama said it well in his historic speech on the financial emergency last March 27 in New York. ``We need to regulate financial institutions for what they do, not what they are.'' Increasingly, different kinds of financial firms do the same kinds of things, and they are all capable of infusing toxic products into the nation's financial bloodstream. That's why Treasury Secretary Hank Paulson has had to extend the government's financial safety net to all kinds of large financial firms like A.I.G. that have no technical right to the aid and no regulation to keep them from taking outlandish risks. Going forward, all financial firms that buy and sell products in money markets need the same regulation and examination. That will be the essence of the 2009 version of the Glass-Steagall Act. Reform Two: Limit Leverage. At the very heart of the financial meltdown was extreme speculation with esoteric financial securities, using astronomical rates of leverage. Commercial banks are limited to something like 10 to one, or less, depending on their conditions. These leverage limits need to be extended to all financial players, as part of the same 2009 banking reform. Reform Three: Police Conflicts of Interest. The conflicts of interest at the core of bond-raising agencies are only one of the conflicts that have been permitted to pervade financial markets. Bond-rating agencies should probably become public institutions. Other conflicts of interest should be made explicitly illegal. Yes, financial markets keep ``innovating.'' But some innovations are good, and some are abusive subterfuges. And if regulators who actually believe in regulation are empowered to examine all financial institutions, they can issue cease-and-desist orders when they encounter dangerous conflicts. We're talking about a Roosevelt-scale counterrevolution here. But nothing less will prevent the financial collapse from cascading into Great Depression II. And the public should never again forget that this needless collapse was brought to us by free-market extremists.

Ms. KAPTUR

Ms. KAPTUR. Madam Speaker, I rise today with pride to recognize the entry into the Ohio Women's Hall of Fame of Billie Johnson of my District. Mrs. Johnson is a founder of the Area Office on Aging of Northwest Ohio. She has been a leader of elder and women's issues throughout her accomplished career. Billie Johnson can claim many ``firsts'': she was the first African American elected Governor of Zonta International--District 5, Ohio, West Virginia and Kentucky; she was the first African American woman elected to the Board of Directors of National City Bank; she was appointed by former Governor James A. Rhodes to serve two terms on one of Ohio's first Women's Advisory Boards to recognize the achievements of women throughout the state and to improve opportunities and employment for women; she organized efforts to incorporate under Ohio law the first regional, non-profit office on aging in northwest Ohio; she launched the first SeniorNet Program in northwest Ohio--an affiliate of national SeniorNet Inc--that helped older citizens learn how to use computers and navigate the internet; fostered the development of the first information and assistance programs in Lucas County for grandparents and other kin who are raising children; she established the first Elder Friendly Program for Toledo--affiliated with the national Elder Friendly Program--with the assistance of the former Toledo Mayor Jack Ford, to help improve services and accessibility for older citizens shopping in retail stores and local businesses; she fostered the creation of a Senior Safety program for older citizens; and she spearheaded the organization of the first campaign to get a Senior Citizens Tax Levy on the ballot in Lucas County to help increase meals for homebound elders, expand home care for the sick and frail elderly, provide more services of Alzheimer's patients and their caregivers, and expand services for senior centers. Billie Johnson is widely regarded by her colleagues in the aging network. Her leadership fosters a spirit of cooperation, allegiance and loyalty which is rare. Evidence of her skill is the development of a master plan, in cooperation with many partners, for the re-use of the 42 acres of county-owned land surrounding the Area Office on Aging into a comprehensive, continuing care complex for older adults. As the Area Office on Aging's first and only Executive Director for three decades, Mrs. Johnson has helped in the creation and development of many senior centers, nutrition sites for seniors, transportation programs, health services, adult day care programs, home care, and numerous other services for older adults. She has been an advisor, consultant and speaker for numerous local, state, national and international organizations and agencies serving older persons including: Iowa Commission on Aging, Ohio Department of Aging, National Church Residences, National Council on Aging/NISH, National Caucus and Center on Black Aged, Gerontology Program for the University of Toledo, and numerous Area Agencies on Aging located in Michigan, Ohio, Kansas and Iowa. She was even selected to participate in the United Nations World Conference on Women Forum in 1985 in Nairobi, Kenya. The International Federation on Aging later published excerpts of her white paper in a book entitled: ``Global Aging.'' More important than any professional achievement, Billie Johnson has carried forward the lessons learned at her grandmother's knee as she inspires and teaches her own daughter and granddaughters. She guides them in proud tradition and shows them by example how to be strong women in their own right. I have counted on Billie Johnson's wise counsel throughout the years, as have many others in our region. She is a compassionate, caring, and dynamic woman, and a fine example to all as a Member of the Ohio Women's Hall of Fame. I know I join with many across our state when I offer my warmest and heartfelt Congratulations!

Ms. KAPTUR

Ms. KAPTUR. American taxpayers, think about this: So far this year the Bush administration has put you on the hook for $30 billion to prop up an investment house on Wall Street, Bear Stearns. Now you have been pledged to insure $200 billion to $2.4 trillion for the stock of loss- plagued Fannie Mae and Freddie Mac. And taxpayers this week have been put on the hook for the insurance company American International Group to the tune of $85 billion. It seems like for Messrs. Paulson and Bernanke, any blank check for Wall Street can't be bigger. Every day it gets bigger. Now, what about Main Street? In the State of Ohio, we are hemorrhaging with mortgage foreclosures. There are no workouts. Messrs. Paulson and Bernanke haven't come to Ohio to make some of that cash available. Ohio needs $20 billion to do workouts now. We will have over 100,000 more foreclosures this year. All that legislation we passed here in Congress, it has no bite, because it isn't helping people now. We need some attention to Main Street, not just Wall Street.

Ms. KAPTUR

Ms. KAPTUR. Mr. Speaker, Wall Street's big banking boys, those self- proclaimed geniuses of high finance, are bankrupting America. These plunderers of our economy who have fought tooth and nail against financial regulation now are running home to mama. They who virulently oppose government oversight in the markets have come begging to the U.S. Government, mama, to bail them out of their bad decisions. They want mama to make it all better. Well, mama, the Federal Reserve and the Treasury, now run by Wall Street's best friends, have happily been shelling out from our taxpayers more than $300 billion already and counting for those irresponsible Wall Street giants. Meanwhile, homeowners in my district are suffering as a result of these high flying bankers' self- aggrandizing decisions. I've not seen Secretary Paulson or Chairman Bernanke running around Ohio over the weekend, expressing concern about working people's houses and about helping them work out troubled loans. No. All they're doing is sending those folks the bills. The first check that mama wrote was in March. The Fed's main role in the Bear Stearns buyout by JPMorgan Chase was a $29 billion loan to a corporation it created to buy $30 billion worth of assets from Bear Stearns. If the assets gained value, the Fed would profit. If the assets lost value, the first $1 billion would be lost by JPMorgan Chase, but the rest of the losses would be borne by--guess who?--the American taxpayer. Then mama wrote a blank check, a big one, to Fannie Mae and Freddie Mac. Now, that bill is already $200 billion, and it could rise to $2.4 trillion, a blank check. Last year, the head of Freddie Mac earned compensation of $18.3 million, and Fannie Mae's chief, David Schmidt, received $11.6 million directly, not counting all of their other bonuses and stock options and who knows what else. Now mama has written a third check for the crisis on Wall Street, and has effectively nationalized American International Group today with an $85 billion loan. I wonder why we don't just change the name of the U.S. Treasury to the Sovereign Wealth Fund, because we are borrowing money from other countries in order to bail out these institutions. By the way, from 1999 to 2004, the CEO of AIG, Maurice ``Hank'' Greenberg, was named to Forbes Magazine as among the ``world's richest people,'' with a net worth in 2004 of $3.6 billion. What a cozy group they have up there on Wall Street. The CEO named earlier this year, Robin Willumstad, had been the president of Citigroup since 2002, and his base salary was $1 million, plus up to $4 million to $8 million in targeted annual bonuses, plus $13 million targeted annual incentive pay and a one-time $24.5 million restricted stock award to vest over 4 years. Were our homeowners to get a deal like that. The American people are truly getting bilked. They didn't get a fair share of the upside, and they are getting all of the downside and a huge IOU. Foreclosures are going up in Ohio. And while Wall Street is made whole, the folks back on Main Street are losing their homes and getting the bill. So while the banks get to run home to Mama and they are crying, we really have to ask ourselves, what has Mama given us here? What does it say about our values when we pump hundreds of billions of dollars into preserving Wall Street's bad boys while ignoring the plight of the American people? Across Main Streets, from coast to coast, people are losing their homes. But are Mr. Paulson or Mr. Bernanke giving them any bet on the upside? They are not even helping them on the downside. All they are giving them is a bill for Wall Street's excesses. When Roosevelt talked about malefactors of wealth, boy, was he right. I feel sorry for our country, I feel sorry for this Congress, that we can't do a better job of standing up for the people today who are losing their homes in Ohio. Thirty-eight thousand more perched at the edge. Our State needs $20 billion just to do workouts in our State. Where is the Federal Reserve? Where is the Treasury Department? Why do they only help the rich people? What about the rest of the people who have to work for a living? I can't think when I have been as upset as I am tonight about what is happening by the big shots, and the people who are paying the bill are getting shoved off the edge. Wake up, America. Wake up, America. Pay attention to what is happening here. Contact your Member of Congress. Every citizen of this country that is a taxpayer and every citizen who owns that home mortgage has a right to a decent life, not just the big shots up at the end of Wall Street up in New York City.

Ms. KAPTUR

Ms. KAPTUR. Mr. Speaker, I wish to associate myself with the remarks of the gentlelady from California, our dear colleague, Congresswoman Barbara Lee, and thank her very much for her remarks on Congresswoman Stephanie Tubbs Jones. We share your feelings and your warmth and affection toward her, and I know that your remarks are of comfort to her son, to her sister, to her family, to all those who are associated with her and, of course, her staff, who must carry on. We thank you so much for that. I rise this evening to do my part to offer the American people a point of view about the financial markets today and their unsteadiness. We know that the Dow Jones dropped over 500 points. We can all question how Wall Street and its actions have placed our country in this position with such high risk, high-leverage practices with no accountability. I can remember back to 1999 when some of us fought very hard against the Securities Reform Act, so called, of that year, when, for the first time since 1935, this Congress passed the turning back of the Glass- Spiegel Act, threw it out the window, actually, where in our country we separated banking from commerce. We said, no, all those years, prior to 1999, we didn't want to be like the European banks, we thought it was very risky to allow Wall Street to undertake some of these practices that have now led to this great instability. Many citizens are calling our office, and people bump into you and say, well, what are we supposed to do? We are concerned about the future? I guess one word would be, one phrase would be, don't panic. Short-term advice to families would be to take a look at, if you have savings, where they are deposited, make sure they are in accounts that are federally insured by the Federal Deposit Corporation. This Congress will do whatever it must to make sure that those accounts are insured up to a level of $100,000, which is the current law. People can look at their bank accounts, they can look at their credit-union accounts and make sure that they are within those boundaries. People can take a look at safe investments like U.S. Treasury bills, and U.S. Savings Bonds. Yes, they don't pay as much. Sometimes their maturity periods are much longer, but people have to be thinking about the long term, not just the short-term. Sometimes, I guess there is an old expression, sometimes when something looks so good, it's too good to be true, it probably isn't true. So one ought to be very prudent in these times. Of course, having a hard asset like a home or a piece of land, or something that is very tangible and can hold value in the future, is something to think about in order to protect yourself for the future in view of some of what we are experiencing. I would advise families to avoid pay-day loans to make sure they don't lock themselves into these never-ending loans with interest rates that push you into the poorhouse so fast you can hardly believe it. I would encourage citizens to avoid high risk. Again, if it sounds to good to be true, it probably is. What has happened as a result of all this so-called banking deregulation, there are a lot of mailings that go out to people asking them to get hooked on credit, and they don't tell people how much that interest rate is going to be down the road. There are many, many phone calls that come into families' homes now from places far away, where there is no accountability. You don't really know who the people are. You can't even see who is talking to you over the telephone. I would urge families to be very, very cautious and to get good sound financial advice. Look locally to one of your certified, not-for-profit consumer counseling agencies. There is a network of those around the country. You can call your Member of Congress in your own region, and you can find out who the certified not-for-profit counselor is in your area. Many times credit unions, even if you are not a member of the credit union, they do great. Consumer counseling, that's what they are established for under the laws of our country, and you can really try to protect yourself in the markets that we are facing today. It's a little bit dicey out there, so you have to be careful. Congress, again, must meet its responsibilities to protect the deposits of the American people. We certainly will do whatever is necessary there. But people can do a lot for themselves as well. I always tell people if you can't afford a fancy car, get one for transportation. Why do you have to prove to somebody that you can buy the most expensive car in the world? You don't really need that if you are lucky to have a job in the economy of today. If you can't afford the gasoline, use the bus system. Use the bus maybe 2 days a week, drive 3 days a week. Find a way to use the dollars you have wisely. Think creatively. Communities, and I know our mayors are struggling with this around the country, how do they really hedge against an uncertain future? My advice is to make decisions and think about how do we use the dollars in this community wisely, to create wealth, and wealth is more than money, wealth, our assets that grow over time. Money sometimes is fungible. It can disappear off a balance sheet. But, in fact, if you have a set of farmers around your community, who can help your region become more financially and food self-sufficient, communities ought to exercise that power. We ought to help our citizens become energy self-sufficient in their own households. There are many things communities can do. As I close this evening, I would urge communities across this country to think about creating wealth, not just pushing money around, and getting the best financial advice you possibly can in these difficult times.

Ms. KAPTUR

Ms. KAPTUR. You know what is really interesting Congressman Ryan, is that coming from the background that he did, he could have been an unceasing voice for business as usual. But John took that background and he grew from it and he became something beyond his own heritage in a way, and he wanted to make America a better place. Having seen some of what happened in industry run amuck, he believed in industry, but he knew it could be done in a better way and he set a different path for America. And his family has every right to feel blessed and gratified, as we do, for having known him. And Ohioans and every American really has a right to consider themselves very, very fortunate for having had a man like John Seiberling in our lives, if only for a time. And I know that his family will miss him deeply. We certainly have missed him from the day that he left here, and we hope that the strength that he gave to all of us and to his family in life will comfort them now. And we know that John Seiberling made his mark, and we feel very fortunate to have counted him among our most beloved colleagues.

Ms. KAPTUR. I don't know if it was noted that John was born in 1918, in this month of September, to Lieutenant John Frederick Seiberling and Henrietta McBrayer Buckler. Like his father, John went on to serve his country in the Armed Forces. While fighting in World War II while in the United States Army, he was awarded the Legion of Merit in the recognition of his role in planning motor transport for the D-day invasion of Normandy. When you think back to what he did as a young man and from his military service on, he never stopped fighting for his country. He was such a patriot. Congressman Ryan talked about his ivy league education and his roots, his scion from the Goodyear Tire and Rubber Company. He could have come here, and he could have represented Wall Street, but John Seiberling never did that. He represented the best interests of this country. He never tried to clean up for himself. I remember, after he retired, he sent me this beautiful, beautiful book about flowers in the Akron area and about the ecosystem of the northeastern part of Ohio. He was always teaching; he was always contributing, and he made this institution sparkle. Now, was he a telegenic figure? We seem to be in an age of television and media where everybody has got to have the right makeup and the right glasses. Are you telegenic? Are you TV ready? Are you camera ready? You know, John Seiberling didn't care about that. Sometimes his tweed suit would be a little bit rumpled. I wish for more Members with rumpled suits whose hair isn't exactly combed. John was always very neat--don't get me wrong--but he was there for the country, and he trudged it from coast to coast. I think that his service on the House Judiciary Committee, history will note, took great courage as he drafted the Articles of Impeachment brought against former President Richard Nixon. Imagine the courage and the scholarship and the acumen that that effort entailed. He was a man to be dealt with, and you knew exactly where he stood, and when he was in your corner, he never wavered. I wanted to mention his devotion to his family, to Betty. They were a team. I remember one time, Congressman Ryan, when for whatever reason I ended up in Akron, Ohio, at this big event in the city. I walked in this room, and I was meeting buckeyes whom I'd never met before. All of a sudden, there came this man down the aisle, to be seated with his wife. He had retired from Congress, and his vision wasn't that good at that point. They brought John Seiberling in, and the audience just applauded wall to wall until he took his seat with his wife's next to his. He was present for the program, and he heard every word. His mind was quick, and he absorbed everything that happened. When I went up to him afterwards, he knew exactly who I was; he knew exactly what had happened, and he was there to try to change America for the better in that particular election year. To their sons John, David and Stephen, all I will say is thank you from the Kaptur family for allowing us to know your father because, to this day, he has an influence inside this institution. I learned so much from him, and he was so kind to me as a new Member and as the first woman from my region of Ohio ever to be elected here. He welcomed me. He helped to tutor me. He made me feel very much a part of this institution from day one. I shall always be grateful to him. I never forget him. He is a standard that I hold and is someone to whom I still look up in my own work. As I look at that plaque every day, I think of him. I can't tell you how many people have commented on it, and I always say, ``That's from Congressman Seiberling.'' His life still resonates here and across our country. We loved him, too. Now, he wasn't exactly a lovable figure in a way. There was a certain circumstance about him. I suppose, because of his lawyerly training, you sort of felt like you were meeting a judge in a way and that he was judging every person and every event at which he was present, but there was also a great strength, and you wanted to know him better. You wanted him to teach you. You wanted to learn from him. The country is better served by individuals like him. I doubt that John took millions of dollars away from here in any way, personally or politically. He wasn't that kind of guy. He served our country. Oh, we would be so much better if we could have more John Seiberlings in this institution. So I say to Congressman Ryan thank you so much. You know in whose footsteps you walk. Congresswoman Sutton knows in whose footsteps she walks. I just feel very fortunate to have been able to serve here long enough to have known John Seiberling. His perseverance, I think, has inspired us all. I would say to the gentleman I have other remarks to make, but I'm sure that you have other material there that you would like to place in the Record. I just know John is watching over us and is wanting us to do better, to do better for the Republic because he did better for the Republic, and we hope to make him proud.

Ms. KAPTUR. Congressman Ryan, I just want to thank you for your leadership in assembling this Special Order this evening. Every member of the delegation joins you in extending our deepest sympathy to Betty, to John's family, to all of his friends, not just in Akron but across this country. I know how proud he would be of you and of your service to have this very intelligent force here inside the Congress. I had the great joy of serving with John Seiberling. One can offer many plaudits and memories of his great work, and I am flooded with memories as I speak this evening, but one word comes to mind. That word is ``integrity.'' John Seiberling was absolutely an honest, decent, patriotic American. I recall many of his great works. I think he had these beige Chuck-A Boots, these Chuck-A Boots. Do you remember when those were in style? He always wore them. You knew when John had the Chuck-A Boots on that he'd either been up in Alaska or that he'd just come back from trying to get the Cuyahoga National Recreation Area designated or that he'd been out west in some park or on some mountain somewhere. He always had like a tweed jacket, and he had a cut about him where you knew that he had been raised in a family of wealth. He didn't spend a lot of money on clothes, but he dressed a certain way. There was a certain cut of the man that helped to define him, and when he looked at you, he looked at you straight, and you always knew where John Seiberling stood. There was a certain way he held himself. It was as though he held up the honor of the office by the way he held his spine. I remember the day that Betty sat in the gallery when those of us who were here honored his legacy and his last day of service here in the Congress. I can't believe it was that many years ago, because he was such a force here within the Congress, itself, such a force for integrity of the institution. In fact, in my office, I have a plaque that I had made because of a plaque he had hung in his office, which said that this office belongs to the people of his congressional district in Ohio. I was so impressed that, outside my office, I had a sign made: ``This office belongs to the people of the 9th Congressional District.'' John Seiberling always held us to a higher standard. I have to tell you that I had an experience. When I was first elected, there were only two eagles left on Lake Erie, which is in the western part of Ohio, the region that I represent, and John had just started on the Cuyahoga National Recreation Area. This past year, something really wonderful happened. We've increased the number of eagles to 12 times what used to exist. We have 144 nesting pairs now, but a year and a half ago, two of those critters flew over to the Cuyahoga National Recreation Area, and they took nest, and they've now had three baby eaglets. Every time I think of that, I say, ``Thank you, John Seiberling, for what you did,'' as we give rebirth to this region of America. When he grew up, the Cuyahoga River became a national disgrace as it burned, and people still remember that image today, but John knew it had to be healed. He began doing just what Congressman Ryan and what Congresswoman Sutton have said, working here in the House and, of course, with our dear friend Congressman Ralph Regula as well, to put into place these green emeralds, these jewels of parklands that have now been placed, expanded and improved to a point where our western basin of Lake Erie can touch the eastern side of Ohio in a way that helps to raise up the symbol of this country, the bald eagle. If it would be all right with the gentleman, I have remarks I would like to place in the Record.

Ms. KAPTUR

Ms. KAPTUR. I thank the gentleman very much. On behalf of the American people and certainly the citizens of Ohio who remain extremely proud of John Werth and his colleagues and his air controller associates across our country, please let the record show we extend our abiding thanks on this historic day. We extend our deep remembrances to the families and communities still affected. And we ask God to bless America and help us lead the world to a more peaceful day. [From USA Today, Sept. 11, 2008] 7 Years Later, the Terror Is Still Vivid (By Alan Levin) Oberlin, Ohio--He spent most of his life controlling airplanes. But on this day seven years ago, United Flight 93 was beyond control. Cleveland Center air-traffic controller John Werth had never heard anything like it--the sounds of an animalistic struggle crackling over his radio. He heard screaming, hollering and two guttural groans coming from the cockpit. The horror of one of the four 9/11 suicide hijackings was playing out, Werth tells USA Today in his first public recounting of the day that forever changed America. ``I lost 40 people that day,'' Werth says of the desperate efforts he and his colleagues made to communicate with Flight 93 and keep other planes away from it until the jet crashed in a rural Pennsylvania field. Today, the story of that flight is well known--in books, movies and tales of heroism about the passengers who tried to retake the jet from four al-Qaeda terrorists, and probably prevented an attack on the White House or U.S. Capitol. For Werth, it's been a vivid--if largely private--reality. He was there. He heard it all. Werth's account provides new details about what happened as the hijacking unfolded and how the chaos in the skies caused alarm and confusion for controllers and national security forces. For seven years, Werth, 61, hasn't told his story publicly, initially because he was not allowed to because of a government subpoena related to the prosecution of al-Qaeda operative Zacarias Moussaoui, and later because Werth didn't want the attention. Now, Werth's ready to discuss it and set the record straight. It was Werth who heard the transmission from Flight 93 that suggested a bomb was aboard. The transmission, in a thick accent and broken English, likely was from hijacker pilot Ziad Jarrah, the 9/11 Commission determined later. The bomb was apparently a bluff, a threat the hijackers used to try to control the passengers. At the time, Werth says, it created a new level of alarm among the controllers clearing other planes out of the wayward path of Flight 93, which had departed from Newark, N.J., that morning and flown into Ohio before making a U-turn toward Washington. What if, Werth wondered, the hijackers had a bomb--maybe even a nuclear device? How far would Werth have to keep other jets from a nuclear bomb's shock wave? Twenty miles? Thirty? Every time Werth turned other planes away from Flight 93, the hijacked jet seemed to surge toward them, he recalls, raising questions about what the hijackers were trying to do. At the time, he knew that some passenger jets were missing and that one had hit a World Trade Center tower in New York. ``I'm saying, `What is he doing?' '' Werth recalls. `` `Is this about a midair collision.' '' an attempt to ram another passenger jet with Flight 93? All the while, uncertainty gripped the nation--and Cleveland Center, which oversees a wide swath of the nation's skies between Chicago and New York. ``Something was really off'' That morning began routinely for Werth as he sat in front of his radar screen and radio, surrounded by maps and computers. Soon, the news began trickling down to him. Two jets were ``lost'' over New York. Someone said a small plane (actually a jet, it turned out) had hit the World Trade Center in New York. A supervisor told him to try to contact American Airlines Flight 77, which had gone missing over Kentucky. ``That's when I knew something was really off,'' he says. He was also told to keep an eye on Delta Air Lines Flight 1989, which had taken off from Boston. Amid the confusion, controllers in Boston worried it was connected to the jets missing in New York. Those jets, American Airlines Flight 11 and United 175, also had departed from Boston. Finally came word that a second plane, a large jet, had hit New York's twin towers. The pilots of Flight 93, headed west to San Francisco from Newark, arrived at 9:24 a.m. in Werth's control sector, a roughly 100-by-100-mile patch in the Cleveland area that handles only high-altitude traffic. The Boeing 757 carried seven crewmembers and 37 passengers, including the four hijackers. Within four minutes of arriving in Werth's sector, according to the 9/11 Commission Report and other government documents, the hijackers had launched a violent takeover of the jet. During the struggle, one of the pilots tried to make a distress call or inadvertently switched on the radio's microphone, allowing Werth and other planes in the area to overhear what was happening aboard Flight 93. Werth says most of the sounds of the struggle were unintelligible. There were screams and groans. Werth recalls turning to another controller. ``I looked at him and said, `Dave, did that sound the same to you as it did to me?' He just kind of looked at me wide-eyed and nodded.'' He knew another flight was probably under attach, but which one? ``Somebody call Cleveland?'' he radioed. No one replied. Thirty-three seconds later came a second broadcast from the cockpit. It also had the sounds of a struggle, but this time Werth made out a few words: ``Get out of here. Get out of here.'' About that time, Flight 93 descended about 700 feet. By then, Werth was pretty sure the flight had been hijacked. What were the hijackers up to? Why do they want to be over Cleveland? Why are they this far west? I thought at first, well, you've got the Sears Tower (in Chicago) straight west,'' he says. There were no procedures or training exercises for such an emergency, Werth says, so he made it up as he went along. He asked other crews whether they had heard the scuffle over the radio. When they replied, he knew they were still OK. The hijacked jet became erratic. It sped up and started gaining on another United flight. Werth commanded the second jet to turn right. Seconds later, Fight 93 turned to the right, too. Minutes later, as Flight 93 climbed from 35,000 to 41,000 feet, Werth told Delta Fight 1989 to turn right to clear it away from the hijacked jet. Then Flight 93 made a 180-degree turn back toward the east, forcing Werth to move the Delta flight back out of the way. ``Delta 89, we're gonna go the other way,'' he radioed. As Flight 93 passed over Akron, headed by that time in the direction of Washington, Werth heard a supervisor call out that a jet had just struck the Pentagon. ``It's the Delta!'' Before United 93 had even checked in with Werth, a supervisor had asked him to watch Delta 1989, a westbound flight from Boston to Los Angeles. It was 60 miles east of his sector, flying behind the United jet. Werth has never been sure who called the facility to warn about the flight or why, and other accounts have been murky. The flight was a Boeing 767 like two other hijacked flights out of Boston. It would have been logical to suspect that it, too, might have been a target. As Werth struggled to keep other jets away from United 93, he had to turn the Delta flight several times. The pilots responded normally. He couldn't be sure of anything that day, but it seemed a safe bet that the Delta flight hadn't been hijacked. However, someone in the military seemed to have mixed up the Delta flight with the hijacked jet. A supervisor rushed up to Werth and said, ``It's the Delta, it's the Delta!'' Werth recalls. She told him that a military liaison on the phone had confirmed that the Delta jet was hijacked. Werth told her he was pretty sure United 93 had been hijacked, not the Delta one. A few moments later, she came back. ``He's fine--at least for now,'' Werth told her. After consulting again on the phone, she returned again. ``They said it's a confirmed hijack and a bomb threat,'' she told him. It was United 93 that had made the bomb threats, Werth thought. That convinced him they had to be confusing the two flights. ``Tell them they're full of it!'' Werth says he replied. ``I thought, `God, don't (have military jets that were being scrambled) go after the wrong plane.' '' At 9:44 a.m., the Delta pilots requested a change of course from Werth. The same concerns about their safety had been passed on to the company, and dispatchers had ordered it to land as soon as possible in Cleveland. As it turned out, the military was in no position to shoot down Delta 1989, but Werth didn't know that. He followed the flight on radar until it landed safely. Fight 93 didn't make another radio transmission after 9:39 a.m.Werth watched on radar as the jet crashed near Shanksville, Pa., at 10:03. A bond with Flight 93 Werth retired in 2003 without ever having made an air- traffic error during his 32-year tenure, according to the Federal Aviation Administration, a remarkable record in an era when computers automatically track when planes get too close together. He says he has focused his life on his wife, Mary Kay, and his passion, golf. He says he has watched with occasional outrage as he has been portrayed in movies and books about 9/ 11 by people who had never spoken to him. Today, he will attend a memorial service in Shanksville for the crew and passengers of Flight 93.He's not sentimental or emotional about that day, but he feels a bond with the victims. ``It's hard, when you're a controller, to lose an aircraft,'' he says. ``When there is absolutely nothing you can do and you're not in control, it's doubly hard.''

Ms. KAPTUR. I thank the distinguished chairman for yielding and congratulate Congressman Ackerman on this resolution. Madam Speaker, I rise in support today on the anniversary of 9/11, 2001, and to pay tribute to the over 3,000 Americans who lost their lives in New York, at the Pentagon, and in Pennsylvania. Let me remember that day through the life of one man, a retired air traffic controller, Mr. John Werth, a constituent who was on duty that day at the Major Air Control Center located in Oberlin, Ohio, in our Ninth Congressional District of Ohio. His professionalism and attention to duty that terrible day saved hundreds, literally thousands of lives, though in the end he was not able to prevent the crash of United flight 93, which went down over Shanksville, Pennsylvania, and in which 40 of the lives lost that day remain forever in our memory. In today's issue of USA Today, which I shall include in the Record, Mr. Werth's photo and story appear on the front page. It is appropriate that after all these years some of the heroic stories of that day become more fully available to the public. Mr. Werth's clearheaded efforts, under great pressure and amid great national confusion, diverted aircraft away from the highjacked plane, saving lives. As professional air traffic controllers in the employ of the Government of the United States, he and his colleagues worked hand in hand with our military to do the best they could under the most trying of circumstances. His three decades of experience served America well and cannot be overstated. He, and I know his colleagues across our Nation, acted with courage and dispatch. And we all respect them deeply. They carry with them in their memories of that day the transmissions from those cockpits. There is no question he and his colleagues literally saved thousands of lives by safely landing thousands of flights across this country. They avoided midair collisions and, for their grace under pressure, deserve every recognition and medal of honor the American people can bestow. They hold our admiration, they hold our gratitude, and they hold our respect for their patriotism and attention to duty. We are forever indebted to them.