Patrick McHenry

Mr. McHENRY

Mr. McHENRY. Mr. Speaker, I yield such time as she may consume to the gentlewoman from Missouri (Mrs. Wagner), the chair of the Subcommittee on Capital Markets.

Mr. McHENRY. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from New York (Mr. Lawler), the newest member of the House Financial Services Committee.

Mr. McHENRY. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I said to the ranking member that I was prepared to close. We have a Member that just arrived, and I am going to allow her to have a closing statement here. I thank the ranking member, Mr. Speaker, and her staff working with the Republican staff of the House Financial Services Committee for being able to move these first pieces of legislation. We have three bills that are on the suspension calendar this evening that are bipartisan bills. One has a primary sponsor by a Democrat, and two have primary sponsors by Republicans, but all are bipartisan. I thank the ranking member for her willingness to work across the aisle to move bipartisan legislation. In doing this, I recall the beginning of last Congress 2 years ago, and 2 years before that, when she reached out to Republicans in the then-minority and offered us the same thing. I am grateful for that outreach 2 and 4 years ago. I have extended the same hand to the gentlewoman from California, and she has likewise extended the same hand to me. Mr. Speaker, I am very grateful for the leadership of the ranking member and her willingness to work with us. Mr. Speaker, I yield the balance of my time to the gentlewoman from Indiana (Mrs. Houchin), a new member of the House Financial Services Committee.

Mr. McHENRY. Mr. Speaker, I urge the adoption of this bill, and I yield back the balance of my time.

Mr. McHENRY

Mr. McHENRY. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous material on this bill.

Mr. McHENRY. Mr. Speaker, I yield myself such time as I may consume. I rise in support of H.R. 582, the Credit Union Board Modernization Act. Every day, consumers in each of our districts rely on their local credit union to help them with things like securing a loan to buy a home, saving for retirement, or even financing tuition. This means that credit unions need to spend their time working with their members, not wasting valuable resources and staff time checking the box on monthly meetings that may not be necessary. This bill allows credit unions to do that important work. By updating the Federal Credit Union Act to reduce the frequency of required board meetings, certain Federal credit unions will have greater flexibility in meeting requirements. At the same time, the safety and soundness of the financial system will be protected. Currently, Federal credit union boards are required to meet at least once per month. Under the bill's new requirements, Federal credit unions with a composite CAMELS rating of 1 or 2 will be required to meet at least six times annually, with at least one meeting held during each fiscal quarter. What does that mean? It means entities with the strongest performance and risk management practices will be rewarded. That means, instead of checking the box on those monthly meetings, if they have high-quality performance and risk management, they will be relieved of some of those burdens. To be clear, this is not a one-size-fits-all mandate. There is nothing in the bill that prevents those credit union boards from meeting each month or even more often, if needed, and they do. In times of financial stress, these boards meet quite frequently to assess risks and to protect their members' nest eggs. This bill also acknowledges that new or poor-performing credit unions may require more regular meetings to ensure that they can provide the level of service their communities deserve. This legislation continues to require monthly meetings for new Federal credit unions during the first 5 years of existence. In addition, credit unions with a composite CAMELS rating of 3, 4, or 5 must continue to meet once a month. These are the credit unions that need to improve performance and risk management practices to ensure the safety and soundness of our financial system. Mr. Speaker, I will finish with this: This bill is a good illustration of how Members can come together to create bipartisan legislation to modernize outdated practices and policies for the benefit of our communities' financial institutions and for their members. Mr. Speaker, I commend my colleague, the gentleman from Michigan (Mr. Huizenga), the chair of the Subcommittee on Oversight and Investigations, for his good work last Congress and this Congress on this bill, and a bipartisan bill indeed this is. Mr. Speaker, I reserve the balance of my time, and I urge my colleagues' adoption and support of this bill.

Mr. McHENRY. Mr. Speaker, I yield such time as he may consume to the gentleman from Michigan (Mr. Huizenga), the chair of the Financial Services Committee's Subcommittee on Oversight and Investigations.

Mr. McHENRY. Mr. Speaker, I yield myself the balance of my time for closing. This is the case on the House Financial Services Committee, when we see a challenge that has a commonsense solution, we try to tackle it and we try to tackle it in a bipartisan way. I want to concur with Mr. Huizenga in his praise of Mr. Vargas. This was a bipartisan bill between Mr. Vargas and Mr. Huizenga last Congress, and it continues to be a bipartisan bill this Congress. I thank my colleague, Mr. Vargas, for offering it, and I thank the ranking member for working with me and with my team to bring these three bipartisan bills before the full House in the opening month of Congress. Mr. Speaker, I urge this bill's adoption, and I yield back the balance of my time.

Mr. McHENRY

Mr. McHENRY. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 298) to amend the Securities Exchange Act of 1934 to expand access to capital for rural-area small businesses, and for other purposes.

Mr. McHENRY. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous material on this bill.

Mr. McHENRY. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise in strong support of H.R. 298, the Expanding Access to Capital for Rural Job Creators Act. I thank Congressman Mooney and my colleagues on the other side of the aisle for their work on this issue last Congress and this Congress. In the Financial Services Committee, we continually highlight the importance of capital formation for entrepreneurs and job creators in underbanked rural communities. That means their ability to get a loan, their ability to get investment capital. We want to enhance every American's ability to get access to capital to take their ideas to market. I can speak from experience about the struggles emerging entrepreneurs face when starting or growing their own small business. My father started a business in our backyard, mowing grass for other people. He and his buddy both had five kids. I am the youngest of five kids. My dad's business partner had five kids. They had plenty of free labor. What they didn't have access to was capital or investment capital. So his first piece of lending was done because he had a Toro, which was the best lawnmower you could get at the time. A Toro salesperson so wanted to make the sale that he let him use the equipment until my father and his business partner could get paid from the hospital where they were mowing the grass. That was the first piece of equipment they got, because the sales guy wanted to make the sale. The second piece of equipment they got was a truck, to put that lawn mower in the back of, that they got using a Master Charge, which is now Mastercard. They used a credit card to buy a truck. They put a rope around this very expensive riding lawnmower in the back of this beat-up pickup truck. That was the dream for both families that put five kids through college. Both families, five kids. Ten kids total put through college. Now, my brother runs that business that my father started in our backyard. The question of access to capital, if you don't have friends that have personal wealth, it is very difficult in this country. It is in rural communities. It is in urban communities. We have areas of this country that are underbanked and resource starved. It doesn't mean that they have less good ideas because of where they are born. They don't. That is not connected with this. They are starved for capital. What we need to do, in a bipartisan way, and what we have had conversations on in a bipartisan way on our committee, is how to fix that problem. We are trying because we have communities across this country that are being left behind. That is completely unacceptable. This is a bipartisan bill that tries to get at that and help small businesses that are vulnerable in rural communities. Research shows that after the last financial crisis, small businesses and startups were less likely to form in rural areas than in urban areas. Now, these same small businesses are facing record inflation and supply chain disruptions. In recent years, the SEC's Small Business Advocate found that rural businesses that seek investor capital are raising higher amounts. However, rural businesses are still raising less capital than their urban counterparts relative to the size of the affected population. But even the urban numbers misrepresent what is happening in urban areas in this country. Just because a big business is headquartered in an urban area doesn't mean they are serving the urban area or that they are employing in that urban area. So we have got huge challenges. In rural areas, which this bill deals with, every small business and entrepreneur counts. They are the lifeblood of the local economy, and their success is critical to the success of their community. This bill is just one example of how Congress can help solve one of the issues that rural small businesses face: access to capital. Mr. Speaker, I thank Congressman Mooney for his work on this bill. I urge my colleagues to support this bipartisan legislation, and I reserve the balance of my time.

Mr. McHENRY. Mr. Speaker, I agree with the words of the ranking member. Mr. Speaker, I yield such time as he may consume to the gentleman from Arkansas (Mr. Hill), the vice chair of the Financial Services Committee and the chair of the Digital Assets Subcommittee.

Mr. McHENRY. Mr. Speaker, I yield myself the balance of my time. Mr. Speaker, I thank the ranking member for her words and comments here. It is true we have worked together on capital formation initiatives in previous Congresses and I would hope that we will be able to do the same. I know of her upbringing in Missouri and her career in California. She has both rural and urban experiences that she can bring to this and I, likewise, have mainly rural upbringing to bring to this, but I think together we can craft a smart agenda, address the needs of the American people, and that is my intention with a focus on capital formation across the country, with the needs of a modern economy to digitize so many of our processes in the world of financial services, and the need to give architecture to a new range of assets that are in the financial services world around cryptocurrency and digital assets. There is a lot that is happening here that we have to embrace and allow that prosperity to be spread across the country. Working together, I think we can do that. Mr. Speaker, I urge adoption of this piece of legislation, and I yield back the balance of my time.

Mr. McHENRY

Mr. McHENRY. Madam Speaker, today, I come to the floor to honor a member of my team who has devoted the past 18 years to serving the constituents of North Carolina's 10th Congressional District, serving it with integrity and honor, especially for veterans and servicemembers. It is my true honor today to pay tribute to my friend and my lead veterans and military caseworker, Joanna Rowe, who is retiring at the end of the year. Joanna has been with me since the beginning of my service here in the House in the beginning of 2005. Since day one, anyone who encountered Joanna instantly knew her passion for our veterans. We had veterans line up just to go sit down and talk to Joanna and have a conversation with her because of her warm spirit and what a wonderful person she is, and everyone understood that very quickly. The numbers tell that story about her passion for our veterans. During her service, Joanna has handled just shy of 6,000 veterans' cases and 362 Active-Duty military cases. She has helped 106 veterans obtain medals they were due for their service. She played an important role in helping establish the VA community-based outpatient clinics in Hickory and in Forest City, North Carolina, and was a key resource to county veterans service officers in 17 different counties during her service. Susan Hall, the veterans service officer in Rutherford County, said of Joanna: ``Joanna's commitment to serving the veterans of our community is exemplary. I will miss her greatly. The Congressman, as well as the people of Rutherford County and the great State of North Carolina have been blessed with the service of Joanna Rowe.'' Joanna will be missed and will be missed by so many, not just the veterans, but her coworkers who love her dearly. And not just her coworkers, but me. Being able to work with her and to call her a friend and to learn from her has meant a great deal to me and to my wife Julia, as well as my kids. So we want to thank her for her service. I thank her for her loving spirit and the strength of her faith. It seems like just yesterday that she and I and her husband, Freddy, sat down for lunch in the fall of 2003 to talk about politics. I learned a lot during that first election to Congress from Joanna, and I thank her for her service and thank her for her friendship. Joanna, we know you won't be a stranger. Thanks so much. We love you.

Mr. McHENRY

Mr. McHENRY. Mr. Speaker, in 2015, I spoke here to pay tribute to the wonderful place in Gaston County, North Carolina, called Holy Angels. Then it was being recognized for its 60th year fulfilling their mission of ``loving, living, and learning for the differently able.'' Today, I am here to honor the leader of this organization, Regina Moody, who, after 40 years as president and CEO of Holy Angels, is retiring. I have known Dr. Moody for most of my life. In fact, prior to her work at Holy Angels, she was my principal at St. Michael's School in Gastonia, where she spent a lot of time with my two brothers in the principal's office. Dr. Moody has been a visionary leader for Holy Angels. Under her leadership, the organization has greatly expanded its level of full- time resident care, as well as physical therapy, day, and vocational programs. They also opened several local businesses to serve the community and give their residents occupational experience. I wish Dr. Moody and her family the very best as she begins a very well-deserved retirement.

Mr. McHENRY

Mr. McHENRY. Madam Speaker, I rise, along with Republican Members of the Financial Services Committee, Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets--Rep. Bill Huizenga, Rep. French Hill, Rep. Tom Emmer, Rep. Alexander X. Mooney, Rep. Warren Davidson, Rep. Trey Hollingsworth, Rep. Anthony Gonzalez, Rep. Bryan Steil and Rep. Van Taylor, to express our serious concerns with H.R. 8520, the Countering Untrusted Telecommunications Abroad Act. Although this bill was referred to the Financial Services Committee, the referral was waived without understanding the bill's impact on U.S. capital markets. We believe that H.R. 8520 implicates securities disclosure obligations in a way that runs counter to our existing principles-based disclosure framework. As such, H.R. 8520 risks setting a precedent in support of policies that run counter to our free-market principles and are harmful to the competitiveness of U.S. capital markets. In particular, we are concerned that H.R. 8520 requires publicly traded companies to make certain disclosures to the Securities and Exchange Commission to advance foreign policy and national security objectives. As we have stated on several previous occasions this is ineffective. Sanctioning is the most effective way to achieve foreign policy and national security objectives--not our securities laws. Hijacking U.S. investment disclosure rules to accomplish extraneous policy goals compromises the strength of American capital markets, disincentivizes companies from going or remaining public by increasing compliance costs and reduces investment opportunities for retail investors and retirement savers. Moreover, the SEC is not the appropriate entity for advancing our Nation's national security or foreign policy agenda. Such issues should be handled by agencies with expertise in overseeing more effective tools like sanctions and export controls. Similarly, H.R. 8520 inappropriately considers all information of a certain kind ``material,'' in this case information related to contracts for--or usage of--telecommunications equipment or services from certain providers. Currently, under the Securities Exchange Act of 1934, public companies are required to file annual reports with the SEC that are made public to disclose company information that investors would find material to making investment decisions. It is not Congress' job to tell public companies what information is and is not material. Instead, it is up to the individual company to make that determination on its own. Otherwise, companies will be forced to increase costs and regulatory risks to comply with disclosure obligations that do not materially influence investment decisions. Moreover, this bill is mandating compliance with a disclosure regime that requires disclosing information that is likely unknowable. Specifically, the bill requires that publicly traded companies disclose if they or ``any affiliate'' used or entered into contracts to use covered telecommunications equipment or services. Inexplicably, the bill does not define ``any affiliate.'' Still, in many instances, it will be impossible for many companies to know whether their affiliates contracted for or used such services. To make matters worse, when companies attempt to disclose this impossible-to-discern information in a manner that later turns out to be mistaken, they would be liable for securities fraud. The flawed approach set forth in this bill sets a dangerous precedent. H.R. 8520 should have been marked up in the Financial Services Committee prior to floor consideration in order to fully debate the policy implications. Ultimately, this bill will limit choices for everyday investors, encourage public companies to go private, and weaken the health of U.S. public markets. For these reasons, we oppose H.R. 8520.

Mr. McHENRY

Mr. McHENRY. Mr. Chair, the report accompanying the FSGG appropriations bill includes ``an increase of $6 million above the budget request for USPS to carry out pilot programs to modernize its current postal banking services, including surcharge-free automated teller machines, wire transfers, check cashing, and bill payment.'' This ``Postal Non-banking Financial Services Modernization Pilot Program'' is yet another attempt by progressives in Congress to expand the U.S. Postal Service's core mission into the financial system. This concept is ultimately harmful to American consumers because it will crowd out private sector financial innovation to reach underserved communities. That's why Rep. Luetkemeyer and I offered an amendment to prohibit funding in this bill from being used to carry out the Postal Non- banking Financial Services Modernization Pilot Program. Unfortunately, our amendment was not made in order to the bill we're considering today. Democrats have long called for USPS to be able to offer consumer banking services such as checking and savings accounts and extensions of credit to consumers and small businesses. These functions are beyond the Post Office's core competencies, will subject taxpayers to potential losses, will undermine the private sector's ability to compete with taxpayer-subsidized banking services, and pose a threat to consumers' privacy when it comes to financial data. In 2018, the previous Administration created a special task force to specifically review the Post Office and identify necessary reforms. The Treasury Department was directed to release the Task Force's recommendations, which it did in its report, ``United States Postal Service: A Sustainable Path Forward.'' The Task Force's recommendations were clear: ``given the USPS's narrow expertise and capital limitations, USPS should not pursue expanding into new sectors, such as postal banking, the USPS does not have a demonstrated competency or comparative advantage, or where balance sheet risk would be added.'' Moreover, the Post Office agreed. In response to a widely criticized and highly unusual report by the United States Postal Service Office of Inspector General (OIG), the Post Office made clear that despite any recommendations to the contrary from the OIG, the Post Office's core mission ``is delivery, not banking.'' Postmaster General DeJoy reiterated this position. Progressives argue postal banking is needed to address the decreasing number of bank branches and the rise in the number of people without access to a checking account or short-term credit. Democrats automatically believe that means that the government should provide these banking services, including through the Post Office. What Democrats fail to acknowledge is financial institution branch closures and consolidations result from overly burdensome government regulation, which won't be reconciled using more government. Postal banking has been tried before. From 1911 to 1967, the United States had the ``Postal Savings System,'' run by the USPS' predecessor. The system provided savings accounts with interest rates set by the USPS and funds deposited in national banks near depositors' post offices. The system failed. Postal banking couldn't compete with private sector banking institutions. It did not have the flexibility to meet the needs of customers. Moreover, American consumers demonstrated recently that they are not interested in banking with the USPS. Just last year, the USPS took it upon itself to create a pilot program to offer check cashing services in the form of gift cards. According to documents submitted to the Postal Regulatory Commission, only six gift cards were issued under the pilot program and total fee revenue was $35.70. The failure of the pilot program demonstrates the fact that it was not designed in response to customer demand and that consumers are not interested in banking with the federal government, including USPS. Private sector financial institutions are highly regulated and operate competitively and flexibly in a market-based system. The ensures consumers' demands for innovative financial products and services are met, and they receive the best pricing for them. Congress should not stifle private sector innovation by financial institutions and fintech firms that have already shown promise for reaching underbanked and rural consumers. The USPS should remain focused on its core mission. The fact that only six people used the postal banking pilot confirms that consumers remain supportive of the free market and look to private firms for technological solutions to meet their banking needs. Postal banking is harmful to the financial system and ultimately harmful to consumers. It will crowd out private sector financial innovation and ultimately fail to reach the very underserved communities Democrats claim they want to reach. The USPS should remain focused on its core mission, not creeping into the provision of consumer financial services.

Mr. McHENRY

Mr. McHENRY. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Oklahoma (Mr. Lucas), a longtime member and leader on the Agriculture Committee and the Financial Services Committee.

Mr. McHENRY. Mr. Speaker, I yield an additional 30 seconds to the gentleman from Kentucky.

Mr. McHENRY. Mr. Speaker, I rise in opposition to H.R. 2543, and I yield myself such time as I may consume. This week, Democrats have a bill on the floor to ``address inflation and help bring costs down for Americans.'' Just last week, President Biden stated that inflation is his ``top domestic priority.'' So, let's talk about inflation if we are going to talk about the Federal Reserve. Let's look at the numbers. Let's look at the stats. The President announced that his focus is going to be on the economy this month. To kick it off, his Treasury Secretary, Secretary Yellen, finally admitted that she was wrong when she called inflation transitory last year. To the Biden administration and congressional Democrats, I would like to say to you: Welcome to the party. You are a year late. The American people have been feeling this pain of inflation, and I am glad you are coming to the realization that we have to do something about it. Republicans welcome the conversation. Inflation has surged to a 40-year high. Stats across the board are terrible. Everyday goods and services are more unaffordable today, especially for low-and middle-income Americans and those on fixed incomes. Skyrocketing consumer prices are outpacing wage gains. U.S. households will spend an extra $5,200 this year compared to last year for the same basket of goods and services they normally buy. The national average for the price of gasoline has reached a staggering $5 a gallon. If that weren't bad enough, our economy is now shrinking. The U.S. GDP came in at a negative 1.4 percent in the first quarter of this year. That is problematic. That is bad. Democrats want to blame everything from Putin to so-called corporate profiteering for the inflation crisis. They are still looking for who did it. Well, guess what, folks. The call is coming from within the house. They are the ones that put this on the American people. This is all the result of Democrats' bad economic policies, and this crisis is of their own making. The American people know it. They see it. They feel it. They experience it. In a recent poll released by The Wall Street Journal, 83 percent of respondents rated current economic conditions as poor or not good. This is the result of Democrat economic policies. Since they control the fullness of the Federal Government, they have put their economic policies into place, and we are living with the bad consequences. All across the board, inflation is way up. In another poll released by RealClearPolitics, 60 percent of the American people disapprove specifically of President Biden's handling of the economy. What is the Democrats' strategy? It is to distract struggling families with this bill that we have on the floor today, a bill that might sound good but does nothing to bring down consumer prices or help struggling families. Let's talk about the contents of the bill. Republicans support improving diversity in financial services, but H.R. 2543, this bill, misses the mark. Committee Democrats had the opportunity to work with Republicans on a bipartisan legislative package to achieve that goal. In fact, five of the bills that make up this package received some Republican support, either in markup, in committee, or on the floor in previous Congresses. But instead of working with Republicans, committee Democrats injected this package with another eight partisan poison pills. First, this bill blatantly politicizes the Federal Reserve. In fact, it tasks the Fed with a third mandate, and that third mandate is to close socioeconomic disparities instead of focusing on what we have asked the Fed to focus on, which is price stability and maximum employment possible. So much for the President saying he is not going to politicize the Fed or he is going to respect the Fed's independence. This bill goes completely counter to that. This bill will make credit more expensive and less accessible to those who need it the most. This bill will also pile regulatory costs on small businesses, forcing them to divert resources from business operations to report on diversity and inclusion metrics outlined in this bill. Currently, businesses can self-assess the makeup of their workforce. This bill would impose a one-size-fits-all mandate on all job creators, regardless of size, geographic location, or business model. This bill is a boon for litigious trial lawyers, and it is a boon for them because it expands ECOA, and it opens businesses up to new lawsuits. This creates uncertainty in the credit markets, ultimately increasing the cost of credit and making it more difficult to assess credit risks for financial institutions and businesses. Finally, while Americans are reeling from higher prices, this bill will make it more expensive for families to purchase a home. This bill will impose additional costs on creditors and servicers, which will inevitably be passed on to those applying for loans. The bottom line, this is just another attempt by House Democrats to divert voters' attention from the big issues of the day, and that is their dismal economic record that they have foisted upon the American people. If House Democrats are serious about addressing inflation, as the Biden administration has claimed and as the President has specifically said he is focused on this month, if they were serious, they would abandon a partisan messaging bill like the one we have on the House floor. Mr. Speaker, I urge my colleagues to vote ``no,'' and I reserve the balance of my time.

Mr. McHENRY. Mr. Speaker, I yield 2 minutes to the gentleman from Kentucky (Mr. Barr), my colleague and friend and the ranking member of the National Security, International Development, and Monetary Policy Subcommittee of the Financial Services Committee.

Mr. McHENRY. Mr. Speaker, I yield 1 minute to the gentleman from Arkansas (Mr. Westerman), the ranking member of the Natural Resources Committee.

Mr. McHENRY. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Wisconsin (Mr. Steil), a leader on the Financial Services Committee.

Mr. McHENRY. Mr. Speaker, I yield 1 minute to the gentleman from Ohio (Mr. Davidson), the ranking member of the Fintech Task Force on the Financial Services Committee.

Mr. McHENRY. Mr. Speaker, I yield 1 minute to the gentleman from Tennessee (Mr. Rose), my friend and colleague, and a leader on the Financial Services Committee.