Maxine Waters

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, I yield 1\1/2\ minutes to the gentlewoman from Washington (Ms. Jayapal), a very hardworking progressive leader.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Rhode Island (Mr. Cicilline), co-chair of the House Democratic Policy and Communications Committee.

Ms. MAXINE WATERS of California. Mr. Speaker, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I continue to reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I reserve the balance of my time.

Ms. MAXINE WATERS of California. I continue to reserve the balance of my time, Mr. Speaker.

Ms. MAXINE WATERS of California. Mr. Speaker, may I inquire of Mr. Hensarling how many speakers he has remaining.

Ms. WATERS of California

Ms. WATERS of California. Mr. Speaker, may I inquire as to how much time I have remaining.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, let me again share with you what should be breaking news tonight: the FDIC released its quarterly banking profile today for the first quarter of 2018 and reported that banks made more money than they ever have. Mr. Speaker, $56 billion in profits in a single quarter represents a 27.5 percent surge compared to 2017. Some of these profits came from the Republican tax reform bill that we have called a tax scam law. The community banks, credit unions, and the economy are doing great with Dodd-Frank reforms in place. The banking industry keeps making record profits--an average of $167 billion in annual profits the last 3 years. Banks have increased lending to businesses by 80 percent since 2010. Community banks are outperforming larger banks in increased lending, and the credit unions are growing and have increased lending by more than 10 percent in 2014, 2015, 2016, and 2017. Despite all of that, we have this pay of CEOs of banks that represents so many times more than the median salary in their banks. Specifically, Wells Fargo's CEO made $17.4 million in 2017, 291 times the company's median salary. This is in spite of the fact that Wells Fargo has a track record of consumer abuses while demonstrating that the numerous fines imposed upon the bank have not been a sufficient deterrent to stop its pattern of appalling practices. Let me just identify some of those practices: opening 3.5 million fraudulent credit card and deposit accounts, for which they were fined $185 million. It was so bad that former Chair Yellen capped the bank's size until it cleans up its act. In addition to that, they were found to have illegal student loan servicing practices; inappropriate checking account overdraft fees; unlawful mortgage lending practices, such as overcharging veterans for refinance loans; and charging customers for automobile insurance policies they did not need, which resulted in some customers losing their vehicles. They were fined $1 billion, but it really doesn't make them any different. It is just a cost of doing business. Yet we have my friends on the opposite side of the aisle who come and ask us to be lenient on the banks, to do away with the Dodd-Frank reforms, and to forget about what happened in 2008. Somehow it is all right for these greedy banks to continue the practices that they have. Despite the fact that Dodd-Frank reined them in, they are doing very well. S. 2155, again, is not a community bank bill, and it certainly does not help consumers, so we should not pretend that that is the case. Instead of considering improvements to this Senate bill or advancing narrowly tailored relief, my colleagues on the other side of the aisle are rubberstamping S. 2155 and advancing a Wall Street wish list that could jeopardize the stability of our country's financial system. So, instead of considering a bill to address concerns raised by community banks, one that I am sure could easily pass both bodies with overwhelming bipartisan support, House Republicans have instead decided to take up a bill that is largely designed to fulfill the agenda of Wall Street's megabanks. Passing this bill with broad support would send the wrong message to regulators to accelerate their deregulatory efforts for Wall Street. It is unfortunate that megabanks have once again piggybacked onto the substantial goodwill and support that exists to help ease the regulatory burden for community banks. S. 2155 is a dangerous measure that weakens key consumer protections and will make it harder, not easier, to combat unfair mortgage lending practices. The bill takes advantage of people just trying to make ends meet for the benefit of the largest banks that are making record profits. Make no mistake: I support our Nation's community banks and credit unions, and I support tailored regulatory relief for those institutions. That is a fact that I have made clear through my support of numerous individual measures which have advanced through this Congress, as well as through my community bank regulatory relief bill from last Congress. I will continue to oppose any efforts to use regulatory relief for community banks as a vehicle to ram through deregulation for bad actors and megabanks. If my words and the words of my colleagues here today are not enough of a warning, then I would urge Members to listen to the pleas of hundreds of consumer, civil rights, veteran, religious, and labor groups that strongly oppose S. 2155. Though some of my colleagues in Congress may have short memories, the millions of Americans who lost their homes, their jobs, and their wealth during the 2008 financial crisis did not. So I oppose this bill. I want the Members of Congress to stand up on this very important legislation and say to the greedy banks and the megabanks: No, you are not going to get away with these kinds of actions anymore. Everything that you have done to try to undermine the Dodd-Frank reforms have resulted in more groups coming out to say: Congress, when are you going to stop these banks? They are making plenty of money. They are increasing their profits. Their CEOs are making high salaries. What more do you want from them? I think that our consumers deserve better than any attempt to try and relieve them of those regulatory actions that would support our consumers. I would ask for a resounding ``no'' vote on this bill that would only feed into the greediness of the major banks of America. Mr. Speaker, I yield back the balance of my time.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, today I rise to congratulate Micronova Manufacturing, Inc., honored recipient of the 2018 President's E Star Award. The President's E Star Award is the highest honor given to United States exporters and export service providers in the nation. The award honors and recognizes persons or organizations that contribute significantly in efforts to expand U.S. exports. The 2018 President's E Star Award was presented to Micronova this morning, in a ceremony at the U.S. Department of Commerce.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise today in opposition to S.J. Res. 57, a Congressional Review Act resolution to repeal a very important guidance on indirect auto finance lending that was issued by the Consumer Financial Protection Bureau all the way back in 2013, in order to prevent discriminatory lending. Indirect auto lenders are lenders such as banks that work with car dealers to finance car loans for consumers. Mr. Speaker, first let me say that this is an inappropriate and misguided use of the Congressional Review Act that sets a dangerous precedent. While congressional Republicans so far have been very active in using the Congressional Review Act to tear down important regulations that protect Americans, today they are expanding their harmful efforts even further to now go after regulatory guidance issued by the Consumer Bureau years ago. This is a clear overreach that goes way beyond how the Congressional Review Act was intended to be used. This resolution is one part of a widespread Republican effort to make it more difficult to hold financial institutions accountable. The Consumer Bureau's 2013 guidance on indirect auto lending was issued to provide clarity to indirect auto lenders and protect auto loan borrowers from discrimination. This is a market where discriminatory practices have well been documented. Since its establishment, the Consumer Bureau has levied more than $140 million in fines and penalties against lenders for engaging in discriminatory auto lending practices. Just this January, an investigation by the National Fair Housing Alliance found that, 62 percent of the time, highly qualified minority borrowers seeking purchase and financing options for a car receive more costly pricing options than less qualified White borrowers receive for the same vehicle. According to the same report, less qualified White borrowers were presented with more financing options 75 percent of the time. The guidance issued by the Consumer Bureau simply clarified that indirect auto lenders would be held accountable for violations of the Equal Credit Opportunity Act, or ECOA, if they took part in discriminatory practices in the pricing of auto loans. Under ECOA, it is illegal for a creditor or a lender to discriminate against a person because of race, color, religion, national origin, sex, marital status, age, or receipt of income from any public assistance program. So the issuance of this guidance, which also provided a number of steps to indirect auto lenders that they could use to ensure that they were in compliance with the law, was a commonsense action that has both protected borrowers from unfair practices and helped lenders stay on the right side of the law. Proponents of this resolution say to the Consumer Bureau: Oh, you had no authority to regulate auto dealers. But that is not what is at issue here today. Let's be clear. The Consumer Bureau's guidance applies to indirect auto lenders, not automobile dealers. This resolution would set back efforts to prevent discriminatory auto lending, make it harder for responsible businesses to follow the law, and harm consumers. It would not only repeal the Consumer Bureau's regulatory guidance on auto lending but could also prevent the Consumer Bureau from ever again issuing ``substantially similar'' guidance on the matter. Furthermore, by setting this terrible precedent of repealing regulatory guidance, the majority is opening up a Pandora's box that could have deeply harmful consequences for the public and badly impede the important work of regulators, not just of the financial services industry but of all industries. Mr. Speaker, I strongly oppose the resolution and urge Members to vote ``no.'' I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, this is about discrimination. This is not about false accusations. It is documented that these car lenders have discriminated against people of color. Mr. Speaker, I yield 3 minutes to the gentlewoman from Wisconsin (Ms. Moore).

Ms. MAXINE WATERS of California. Mr. Speaker, I yield 3 minutes to the gentleman from Rhode Island (Mr. Cicilline), the ranking member of the Subcommittee on Regulatory Reform, Commercial and Antitrust Law on the Judiciary Committee.

Ms. MAXINE WATERS of California. Mr. Speaker, the chairman just said that junk science was used; however, Republicans put out a report called, `` `Disparate Impact' Claims Against Vehicle Financing Businesses.'' Here it is. And guess what. The Center for Responsible Lending said that was junk science. Mr. Speaker, I yield 3 minutes to the gentleman from Minnesota (Mr. Ellison), a senior member of the Financial Services Committee and a tireless advocate dedicated to combating discrimination.

Ms. MAXINE WATERS of California. Mr. Speaker, I would encourage the gentlewoman to continue reading so that she can see, under the CFPB rule, that they have the ability to oversee the lending; and what she is talking about is the exemption of the automobile dealers, themselves, but not the lenders. Mr. Speaker, I yield 3 minutes to the gentleman from California (Mr. Takano), the vice ranking member of the Veterans' Affairs Committee.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield 4 minutes to the gentleman from Illinois (Mr. Foster), a Member who has shown true leadership in speaking out against this harmful resolution.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield an additional 1 minute to the gentleman from Illinois.

Ms. MAXINE WATERS of California. Mr. Speaker, I can't believe that in 2018 we are on the floor of Congress seeing the denial of some of my colleagues about discrimination in the auto lending business and defending the automobile lenders despite the fact there has been a study that shows that there has been discrimination. The study should have included women, because they discriminate against women also. They think women are stupid and don't know how to negotiate a loan. Women have been taken advantage of too. Mr. Speaker, I yield 3 minutes to the gentlewoman from New York (Mrs. Carolyn B. Maloney), the ranking member of the Subcommittee on Capital Markets of the Financial Services Committee.

Ms. MAXINE WATERS of California. Mr. Speaker, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I am sitting here appalled at what I am hearing from the opposite side of the aisle, the fact that they would use the Congressional Review Act to attack guidance and then have the audacity to say in the resolution that they can never, ever again in perpetuity ever have anything like this again. Mr. Speaker, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. I would ask the gentleman from Pennsylvania (Mr. Kelly) to please not leave, because I want you to know that I am more offended as an African-American woman than you will ever be. And this business about making America great again, it is your President that is dividing this country. And don't talk to me about the fact that we don't understand. That is the attitude that has been given toward women time and time again.

Ms. MAXINE WATERS of California. I respect the Chair, but don't stop me in the middle when you didn't stop him in the middle. So I shall continue. Don't you dare talk to me like that and think that somehow women don't understand what goes on on the floor of automobile dealers.

Ms. MAXINE WATERS of California. And I am saying that I will continue to do that. However, I don't appreciate that you did not interrupt him when he was making those outrageous remarks about him knowing more about discrimination than I know about discrimination. I resent that. And I resent the remark about making America great again. He is down here making a speech for this dishonorable President of the United States of America. Having said that, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, there are times on the floor of this Congress that we hear some of the most outrageous comments in defense of some of the most outrageous practices. This resolution is yet another harmful piece of legislation from the majority that should be rejected. Week after week, instead of working to benefit hardworking Americans and protect the public from abusive financial institutions, Republicans have advanced legislation to undermine and remove consumer and investor protections, threaten the stability of our economy and financial system, and benefit bad actors in the financial services industry. They are taking our system of financial regulation in precisely the wrong direction. Today, as we have discussed, the majority is putting forth a Congressional Review Act resolution that would repeal important Consumer Financial Protection Bureau guidance to prevent discrimination by indirect auto lenders. This resolution would set back efforts to prevent discriminatory auto lending, harm consumers, and make it harder for responsible businesses to follow the law. It is senseless and misguided. The resolution would also set a dangerous precedent by repealing years-old regulatory guidance, which is not how the Congressional Review Act was intended to be used. Opening the door to inappropriate uses of the Congressional Review Act like this one threatens the important work of regulators, not just of the financial services industry, but of all industries. So I call upon my colleagues across the aisle to work with the Democrats on policies that strengthen consumer protections, rather than the harmful rollbacks like the one before us today. I urge Members to oppose the resolution. And I want my friends on the opposite side of the aisle to know that we don't easily get up and talk about discrimination against minorities and people of color. We don't like to have to do this. We wish that we had come to a time in the history of this country where it did not happen. But I am appalled when the opposite side of the aisle stands up in strong defense of discrimination. If they were really interested in working with the Democrats they would say we have a better methodology of determining whether or not there is discrimination. We want to work with you. We want to do whatever is necessary to ensure that no one is discriminated against, yet I hear from Members like Mr. Kelly who come to the floor talking about we don't know what we are talking about, we don't understand it, we have never been on the floor of a dealership. Oh, yes I have. My husband was in the car business. I know a lot about it. Mr. Speaker, I yield back the balance of my time.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I would like to start off with a quote from Speaker Paul Ryan in a 2012 townhall meeting. This is what he said to his constituents: ``If you're a bank and you want to operate like some nonbank entity like a hedge fund, then don't be a bank. Don't let banks use their customers' money to do anything other than traditional banking.'' I agree, and that is why Congress passed the Volcker rule in the wake of the 2008 financial crisis, to prevent taxpayer-backed banks from engaging in risky, speculative activities like owning hedge funds. But since that time, Republicans have engaged in a relentless attack against the Volcker rule at the behest of Wall Street megabanks. H.R. 4790, the so-called Volcker Rule Regulatory Harmonization Act, is the latest threat to that rule. Specifically, H.R. 4790, contains two problematic provisions that would create a loophole in the Volcker rule and make it easier for the Trump administration to weaken or repeal it. Leading up to the financial crisis, Wall Street megabanks engaged in proprietary trading, which is essentially speculative, highly leveraged betting that benefits their bottom line but uses federally insured loans backed by the U.S. taxpayer. These banks gambled on exotic financial instruments like collateralized debt obligations comprised of risky subprime mortgages and credit default swaps, which even the legendary investor, Warren Buffett, criticized as ``financial weapons of mass destruction.'' When the Housing bubble finally burst, these bets led to massive losses and required the Federal Government to bail out the banking industry with trillions of taxpayer dollars to stop an economic catastrophe. To protect the American taxpayer and the economy from this sort of risky trading as well as to return banks to the business of helping consumers and small businesses, Congress included the Volcker rule's ban on proprietary trading as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Specifically, the Volcker rule prohibits taxpayer-backed banks from engaging in risky proprietary trading and from owning hedge funds and private equity funds. It also prohibits banks from owning the very same risky collateralized debt obligations that accelerated the 2008 crisis. According to Martin Gruenberg, Chairman of the Federal Deposit Insurance Corporation, that is, the FDIC, which is the agency charged with protecting taxpayers from bank bailouts, ``had it,'' this prohibition, ``been in place then, the Volcker rule would have constrained the proliferation of such instruments.'' The result today is less reckless risk-taking by Wall Street megabanks and a stronger financial system. And despite dire predictions by Republicans, our banks have returned to lending to consumers and businesses, and our financial markets are adapting and thriving. For example, since passage of Dodd-Frank, bank lending to businesses has increased 80 percent; and in the bond market, which has long been dominated by bank dealers, we have seen record-new bond issuance by companies, States, cities, and towns seeking to raise funds and record trading volumes in those bonds. Most other metrics also show a healthy corporate bond market. Nevertheless, H.R. 4790 is just the latest Republican attempt to weaken the Volcker rule. First, the bill would provide a blanket exemption from the Volcker rule for 97 percent of our Nation's banks which have consolidated assets of $10 billion or less and with less than 5 percent of those assets in trading assets. To be clear, most community banks do not engage in any trading activities and, therefore, have no compliance requirements under the rule. However, H.R. 4790 would give all community banks the congressional thumbs-up to begin speculative trading instead of focusing on the traditional business of banking. It also makes community banks prime targets for hedge fund salesmen. Now, why is this an area of concern for me? It is an area of concern because I hear the community banks when they say that their numbers are going down because of mergers and consolidation. This bill does not help with this problem. It makes it worse because it sends a shining beacon to hedge funds all over the country that they can peddle risky and questionable investments to community banks, and the regulators will be none the wiser. I am extraordinarily concerned with the extent of the affordable housing crisis our Nation is facing. We need banks to invest in housing and in our communities. I believe that community banks can provide those kind of investments. But I am also concerned that, if the hedge funds can prey on community banks with little oversight, then they will be unable to provide the kinds of investments in housing and small businesses that communities need. Instead, we will see more community banks investing in hedge funds and possibly leaving these communities behind. So when Members ask: How can we create more affordable housing or address the issues that experts like Dr. Matthew Desmond are raising on the housing crisis in America, one thing that we can do is not think narrowly about the impact of financial services legislation, and, particularly, legislation like H.R. 4790 that can create lasting, unintended consequences if not carefully considered. We should think broadly and realize that the policies that we make for banks can have real impacts on the communities they serve. And the regulators and experts have done just that. They have carefully considered the bill's provisions and the unintended consequences that could ensue. That is why the blanket carve-out in this bill is opposed by former Federal Reserve Chairman and the rule's namesake, Paul Volcker, who has said: ``I know from my long experience in banking and savings and loan regulation that plausibly small loopholes can be `gamed' and exploited with unfortunate consequences.'' Paul Volcker was Chairman of the Federal Reserve for part of the savings and loan crisis, which, during that time, more than 1,000 S&Ls failed, fully one-third of the industry. The exemption is also opposed by FDIC Chairman Gruenberg, FDIC Vice Chairman Thomas Hoenig, and investors and advocates. If we truly want to reduce regulatory burdens on community banks that engage in permitted trading activity, we should be looking at other ways to accommodate them, such as by creating a presumption of compliance with the Volcker rule, which reduces compliance costs without opening up a loophole. Rather than encouraging banks, especially community banks, to make speculative bets on hedge funds or derivatives, we should be doing everything possible to ensure banks are focused on supporting their communities by offering mortgages and commercial loans. Second, H.R. 4790 would repeal the requirement that the Federal Reserve, FDIC; Office of the Comptroller of Currency, that is the OCC; Securities and Exchange Commission, that is the SEC; and the Commodity Futures Trading Commission, that is the CFTC, work together to jointly implement the rule. Instead, the bill would delegate sole rulemaking authority to the Federal Reserve, which could choose to consult or not consult with the other regulators. This would unreasonably cut the FDIC out of any future rule changes, even though it is the regulator charged with protecting deposit insurance against the very risky, speculative activities the Volcker rule was designed to prevent. It would also cut the OCC out of the rulemaking process, even though it oversees institutions that account for approximately 40 percent of bank holding company trading revenues. And it would cut out the SEC and the CFTC, even though those agencies have the expertise and jurisdiction over broker dealers and future traders and their marketmaking activities. Worse, appointing the Fed a single regulator would make it easier for the Trump administration to weaken and repeal the Volcker rule, even though it was expeditiously promulgated in 2 years and the regulators are now working together to make appropriate changes. While the bill would at least allow the appropriate banking regulators--SEC and CFTC-- to enforce the rule, such enforcement authority is meaningless if the Volcker rule is effectively gutted by the Trump administration. But this is what my Republican colleagues want. Chairman Hensarling's 600-page Big Bank giveaway, H.R. 10, known as the ``Wrong'' CHOICE Act, would have repealed the Volcker rule outright. H.R. 4790 is merely the latest attempt to do the same thing. Mr. Speaker, I strongly oppose H.R. 4790, and I reserve the balance of my time.