SEC Regulatory Accountability Act

Mr. Speaker, by direction of the Committee on Rules, I call up House Resolution 216 and ask for its immediate consideration.

Mr. Speaker, for the purpose of debate only, I yield the customary 30 minutes to my friend, the gentleman from Worcester, Massachusetts (Mr. McGovern), pending which I yield myself such time as I may consume. During consideration of this resolution, all time yielded is for the purpose of debate only.

General Leave

Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days to revise and extend their remarks.

House Resolution 216 provides a structured rule for consideration of H.R. 1062. This rule provides for discussion and opportunities for every single Member of the majority and the minority to participate in this debate. We made in order every single germane amendment that was submitted to the Rules Committee on this issue.

Mr. Speaker, the legislation before us today is really quite simple. It is a commonsense solution to preventing unnecessary and overly burdensome government regulation, or perhaps an opportunity to understand why the government might be perpetrating a rule that would impact our free enterprise system. It requires the SEC to perform cost- benefit analysis before finalizing any major rule. It also prevents the implementation of the rule if the benefits do not outweigh the costs.

Through this bill, the American taxpayer will be protected from needless regulations that would impede economic growth without providing effective consumer protections. In other words, Mr. Speaker, we're here to ensure that the SEC provides balance with the rules and regulations that are in a major context when it issues these rules on the marketplace.

In January of 2011, President Obama signed an executive order directing all non-independent agencies, such as the Department of Energy, the Department of Education, and others, to abide by the same rules that we're providing for today in H.R. 1062. However, because it is an independent agency, the SEC is not required to follow the President's rules.

The legislation before us today creates parity and opportunity for Congress to work with an agency and other non-independent agencies on a better way for them to promulgate the rules that they do and show a balance in the marketplace, just like the President asked other government agencies to do.

Furthermore, this legislation in no way weakens consumer protections or reduces accountability in the financial services industry. To the contrary, this proposal ensures that regulations issued by the SEC are effective and based on sound policy. Consumers and businesses alike will benefit from a reformed regulatory process.

So I urge my colleagues to vote ``yes'' on this rule and ``yes'' on the underlying legislation.

I reserve the balance of my time.

Mr. Speaker, I appreciate my friend, the gentleman who brings up many good points about jobs, job creation, the ability for this Congress to be able to effectively hear from the American people about the issues and ideas that they're facing, come to resolution in this body, work with our friends in the Senate, and to get legislation to the President of the United States. I think that should be and has been what our goal is about, and it should be our goal also to find common ground.

What's interesting is that this piece of legislation that we're handling now actually went to the banking committee, Financial Services Committee, as an agreement we more or less thought would be a suspension item; in other words, a piece of legislation that there was widespread agreement on that it would be good to put in the rules as one of a group of pieces of legislation, this would be a good idea to have the SEC accept this as part of what they do when they issue a rule.

Now what's happened is it has turned into a larger fight as a result of us wanting to simply make sure that the rules that apply to other Federal agencies also apply to independent agencies. So we thought we were doing the right thing to come and work together, and it's fair, I guess, I assume, to do that, even though we are trying to talk about this rule today.

If we want to talk about the budget and things that are presently being evolved, then we need to listen to our Democratic friends about the budget. They're not happy because we passed in this House an opportunity to have a budget that in the next 10 years would balance, a balanced budget.

The gentleman Paul Ryan, the chairman of the Budget Committee, came up to the Rules Committee and he spoke about how this President, every single year that Barack Obama is President, with the help of former Speaker Nancy Pelosi and the Democrats, raised spending, put rules and regulations on the American people that are causing the lowest level of job creation that we've had in over 40 years, a trillion-dollar deficit every single year. And even with this massive tax increase that was a signing bonus for the President that took place in December, we still are going to run a trillion-dollar deficit. So what my friends, the Democrats, said upstairs in the Rules Committee, what they're for is raising spending another trillion dollars and raising taxes another trillion dollars.

Mr. Speaker, I do understand there's widespread disagreement. There's widespread disagreement when our friends that control the Senate, the Democrats, want to do the exact same thing in their body to this country, raising spending another trillion dollars, raising taxes another trillion dollars.

So they make a good point. Why won't we appoint conferees?

Well, Speaker Pelosi, back in 2009, took more than 2 months to do the exact same thing that they want us to do.

What is occurring is that our chairman, Paul Ryan, is working with their chairman on the agreement of how they would go about doing their job of having a conference on the budget because, you see, when you start so far apart, of trying to balance the budget, trying to not put more rules and regulations and taxes on the American people to where they stand a better

chance, not only of taking care of their own families, and providing for their children to go to college and to be able to pay for it, and to take care of their lifetime needs when they retire, that requires a basic sense of simply agreeing with what people are trying to do versus having the government come and provide a government-run health care system, having the government provide student loans, having the government expand government and take care of people endlessly.

And so there's two different visions, one of raising taxes $1 trillion, raising spending $1 trillion, which is what the Democrats want to do, versus trying to balance our budget, work our way out of problems, grow our economy, jobs, job creation and investment. That's what we're trying to do, and that's what Republicans talked about last month.

That's why we came forth with a budget when the Senate hadn't even done a budget, under Democrat leadership, for 4 years.

That's why we are leaders in Washington. Republicans are leaders in the House of Representatives. We maintain the control. We follow the order and listen to the American people of trying to make their lives better, not grow a government that will be out of control, like an Attorney General who, upon taking the oath of office, then decides when he does and when he does not want to make decisions, and whether he recuses himself; or whether you have an IRS that's out of control and in people's lives and making decisions that are politically based.

Mr. Speaker, this is the reason why we need a government that is smaller, more efficient, and does not have time or the inclination to become all things to all people, and to tell the American people what they will do and control our lives. That's why we're here today.

And, Mr. Speaker, I couldn't be happier than to say today we're on the floor trying to talk about what we thought was an idea that would be accepted by every single person in this body as a great idea.

I reserve the balance of my time.

Mr. Speaker, you know, I think it's very interesting that they're trying to argue that we're trying to get in the way of the SEC. Yet the SEC, in their rules and regulations, have put an impact on small business of $1.75 trillion.

Mr. Speaker, what we're trying to do is apply the same principles and ideas that President Obama had to an agency that spends its life doing rules and regulations. And to say that doing their job correctly, with a balance, is something that we shouldn't require them to do is a silly argument.

That's like saying that Republicans and sequestration--when it was a President Obama idea. It is the President's idea. Sequestration--he's the one that proposed it. We're the ones that simply took him up on his idea. And he signed it into law.

They're arguing with themselves about the things which are good. Once again, the President initiated sequestration. We worked with the President as a back-stop. There we are.

The President issues this same ruling, asking agencies to please make sure they include cost-benefit analysis, but don't apply it later to someone who spends their life doing rules and regulations.

Mr. Speaker, it's an amazing world that we live in. We thought, the chairman of the Financial Services Committee, Jeb Hensarling, after testimony in meetings and in feedback thought, the SEC actually agreed with this. We simply put it in as something they ought to be doing on a regular basis.

Now, Mr. Speaker, I have right now a gentleman from the committee who has spent time and heard the testimony and understands that this should be a piece of legislation that we all agree with because it's common sense.

I yield 6 minutes to the gentleman from North Carolina, a member of Financial Services, Mr. McHenry.

Mr. Speaker, in order to balance out the time, I'm going to reserve the balance of my time.

You know, Mr. Speaker, what we're trying to do is to put in writing exactly what the gentleman talked about why are they promulgating the rule, what effects would their rule have, and why what they do makes sense and is in a balanced way. That's what we're trying to do here today. It makes sense to me. I wish it made sense to more people in this body.

I reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

We've turned this debate into some really commonsense ideas, and that is, that we ought to have a budget, which is what Republicans have said for years. I have no doubt in my mind that when Chairman Paul Ryan of the House Budget Committee, when he is ready, when he feels like they have worked out an understanding with the chairman----

I yield to the gentleman from Maryland.

I don't deal with Senator Patty Murray very much, but I bet you she has an opportunity to call Paul Ryan if that's what she wants.

And I have every reason to believe that when Paul Ryan and Patty Murray work out the differences and decide these things, that that can happen.

I would remind the gentleman, I'm not involved in those conversations. I do know that this is part of your job as the ranking member. I respect that, and I would be in favor of it, because I, too, want us to have more of a unified budget, a clear understanding, an opportunity for us to understand what we're trying to do.

Regaining my time, I would say to the gentleman and to this body, I have every reason to believe that there can be opportunities for our two bodies to work together.

My last point: This ``no budget, no pay,'' it worked. It worked, Mr. Speaker. It was the law. The President actually produced a budget.

The House produced a budget. And the Senate produced a budget, which they had not done for 4 years. So for 4 years you didn't hear our friends screaming and yelling about what the Senate should do until a good idea took place, and that is, in essence, ``no work, no budget, no pay.''

Do you know what? We didn't for 4 years either. We did not have a budget for 4 years. It is actually not required by law. We operated as two bodies--us, we in the House, trying to move forward with a budget that we did pass, and the Senate acting like it wasn't important.

I completely agree with the gentleman from Maryland. I think we should do it. That's why Republicans came up with the process of ``no budget, no pay.''

I think we will see very quickly an opportunity for the ideas around this issue to materialize. We'll find out what the differences are, maybe why we haven't done it.

That's not what this bill is about today. I'll have the conversations. I'll be able to speak cogently. And I will tell you that the gentleman from Wisconsin (Mr. Ryan) and, I believe, because I know him well, the gentleman from Maryland should have a chance to keep doing their work because they believe it's part of the process.

So I offer nothing but accolades of the gentleman, the young gentleman, who is the ranking member of the Budget Committee. And he knows that. He knows what kind of a person I am. I would not say it if I didn't believe it.

But I did not come prepared today on this bill because it is not what it is germane about, and I will respond to him. As a Member of House Republican leadership, I will tell you that our Speaker is interested in moving this body through.

The gentleman from Ohio understands how important regular order is, how important doing budgets is, how making sure that the American people have a chance to know what we're doing. I mean, we actually read bills before we pass them, Mr. Speaker.

I reserve the balance of my time.

No, sir.

Mr. Speaker, I thank the gentleman for asking. I have no additional speakers at this time.

I yield myself the balance of my time.

Mr. Speaker, I am delighted to be on the floor today as we approach this issue about the Securities and Exchange Commission, the SEC, in that we would simply codify in the law an understanding that they would need to, as they have the task of addressing the large rules and regulations that they have--but not for every rule and regulation--put a cost-benefit analysis in their process. It makes sense.

I find it very amazing that our colleagues have taken this to the level that they have in trying to say that we're doing this to be for big banks and against the American people or consumers. That is a farfetched idea. It is about the rules and regulations that they talk about, just like government agencies would be required to have.

In a larger sense, here is why we are here today. Here is why Republicans are doing what we are doing with the budget, with a jobs bill that was passed by this body, why we are trying to talk about what we would do with sequestration--the President's idea. This House has passed numerous times information, our ideas, giving the President the ideas about how we think sequestration should work, a debt limit. We are faced with another debt limit vote here in our future. Two weeks ago, the House talked about how that should be handled. That bill was completely mischaracterized.

The reason we are here is that, under Barack Obama and Democrats, our country is having a $1 trillion deficit every year, and there is not one year in the future that they can point to in which we would balance our budget even for one year. If you cannot balance your budget, if you cannot control yourself--your spending habits, your insatiable appetite to grow government--then it means that we are on a dangerous trajectory.

Look at this, Mr. Speaker. This is history. This is what lies ahead. This is the demise for our children of America being a great Nation. This is why Republicans are down here. This is our past. This is our future. Republicans are here with ideas about balance, structure, working together--the SEC or other agencies working together--to the benefit of growing jobs, balance, things that make sense, instead of a government that's out of control with an IRS with a political agenda and with the Department of Justice abusing its powers that were invested in the Constitution's and the Bill of Rights' understanding of a balance.

This reminds me of a prior administration, under Richard Nixon, when he used the IRS and the Department of Justice to punish his enemies, people he disagreed with.

Mr. Speaker, we are here on a broad range of ideas, evidently, today. When I woke up, I thought it was just about a balanced rule for the SEC, for them to apply in their rules and regulations a chance to say ``cost-benefit analysis'' so that those to whom they provide regulations would understand and the SEC would understand for their some 175 lawyers and 50 economists who look at the marketplace. Let's balance this out. That's what I thought we were here for. Instead, I have learned today we are here to talk about the budget, that we are here to talk about sequestration, that we are here to talk about a lot of things which all embody themselves in: our country is in trouble.

We are in trouble because the President of the United States is for a bigger activist government, for a health care bill that will cause us to lose 2 million more jobs and will keep small business smaller. It will harm our future. Republicans are here simply with common sense and balance today just to talk about the SEC. I welcome the chance for my colleagues, as they have done today, to come to the floor.

The gentleman, Mr. Van Hollen, is one of my closest friends on the Hill. He is a man who I work with on a regular basis, and I respect him. His ideas related to moving forward on the conference should be answered, and I anticipate they will. I simply came unprepared as to that answer today.

So, Mr. Speaker, as always, I will finish where I started and say Republicans are trying to provide leadership. Our great Speaker, John Boehner, does understand regular order and that it is important to read bills before you pass them.

We believe in coming to the floor and talking about ideas before problems occur. That's what we've been doing. That's what the Rules Committee is about. And the legislation that we have handled since January has been all about trying to work together to let the American people know we get it. We're going to balance what we do with their needs and desires to make sure that this country remains strong and is ready for its future because, Mr. Speaker, I, like you, have children who need our country to be prepared for the future.

Mr. Speaker, I ask my colleagues to vote ``yes'' on the rule and ``yes'' on the underlying legislation.

With that, I yield back the balance of my time, and I move the previous question on the resolution.

Mr. Chairman, I yield myself such time as I may consume.

I rise to strongly oppose H.R. 1062. This bill places significant additional requirements for economic analysis by the Securities and Exchange Commission, effectively bringing any efforts at rulemaking to a standstill.

Let's be clear: the purpose of this legislative effort is to stop implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act dead in its tracks. After losing in Congress, the fight against the Dodd-Frank act moved to the courts, beginning with overturning the proxy access rules they adopted under authority provided by that act.

Although I agreed fully with the SEC's position, they went with their friends to court and the court found that the SEC did not meet its already significant requirements to conduct an economic analysis.

After the proxy access case was overturned, the SEC adopted improved standards for conducting cost-benefit analyses. These procedures were cited by the GAO just last December as having all of the elements of good regulatory analysis. Basically, what the GAO is saying is we took a look, we studied it, and they do a good job.

Nonetheless, the bill before us today adds even more requirements, tying up the SEC resources, and putting it at even greater risk for litigation for every rule, despite the assurances of my Republican colleagues that they're only applying the terms of an executive order to the SEC. That executive order explicitly protects agencies from lawsuits based on their economic analysis. H.R. 1062 has no such protection for the SEC.

The Commission is undertaking a valiant effort to finish the Dodd- Frank and Jobs Acts rule, even in the face of attempts by the majority to restrict their funding. As the SEC attempts to balance capital formation with the need to protect investors, this bill weights the scales heavily in favor of industry over investors. In fact, the words ``investor protection'' do not appear anywhere in this bill.

Even without this bill, we can count on industry lobbyists to sue the SEC anytime it sees a weakness in the justification supporting a rule, as they have in several other cases currently before the courts.

And this bill does not apply only to new rules. This is extraordinary--and I want to say this so everybody understands--this bill would require the Commission to review every rulemaking ever issued--even those that have protected our securities markets since the Great Depression--1 year after the adoption of this bill, and then again every 5 years thereafter. As a result, the Commission will be forced to divert resources away from other key areas, such as enforcement.

This comes at a time when House Republicans want to hold SEC funding flat, despite the SEC's new responsibilities--the increase in the number of participants it oversees and the growth of complexity and the size of U.S. securities markets.

It is ironic that as House Republicans push this bill forward, they are also calling for the SEC to speed up its efforts on Jobs Act rules. This bill makes it impossible for the SEC to meet the very deadline we adopted just 2 days ago when we passed H.R. 701.

I urge my colleagues to oppose H.R. 1062, and I reserve the balance of my time.

At this time, I would yield 2 minutes to the gentlelady from New York (Mrs. Maloney).

I now yield 2 minutes to the gentlelady from Wisconsin, Representative Gwen Moore.

I yield 2 minutes to the gentleman from Minnesota, Representative Ellison.

Mr. Chairman, I yield 2 minutes to the gentleman from Connecticut, Representative Himes.

I yield 2 minutes to the gentleman from Delaware (Mr. Carney).

Mr. Chairman, I yield 3 minutes to the gentleman from Illinois, Representative Foster.

I yield 3 minutes to the gentleman from Georgia (Mr. David Scott).

Mr. Chairman, I yield 2 minutes to the gentleman from Washington, Representative Denny Heck.

Mr. Chairman, I yield myself such time as I may consume.

First, I have a number of communications that I will insert into the Record.

I have a Statement of Administration Policy from the Executive Office of the President; I have American Federation of Labor and Congress of Industrial Organizations; I have Americans for Financial Reform; I have AFSCME; and I also have California Public Employees Retirement System, all in opposition to this bill, and asking us to please oppose the bill.

Executive Office of the President, Office of Management

and Budget,

Washington, DC, May 15, 2013.

Statement of Administration Policy

H.R. 1062--SEC Regulatory Accountability Act

(Rep. Garrett, R-NJ, and 23 cosponsors)

The Securities and Exchange Commission (SEC) plays a

critical role in protecting Americans' investments for

retirement, higher education, and other personal savings

while ensuring strong, efficient, safe financial activity

that contributes to the Nation's economic health and job

creation. While the Administration is firmly committed to

smart and effective regulations that advance statutory goals

in the most cost-effective and efficient manner, the

Administration opposes passage of H.R. 1062. By adding

burdensome and disruptive new procedures, H.R. 1062 would

impede the ability of the SEC to protect investors, maintain

orderly and efficient markets, and facilitate capital

formation.

The Administration believes in the value of cost-benefit

analysis. However, H.R. 1062 would add onerous procedures

that would threaten the implementation of key reforms related

to financial stability and investor protection. H.R. 1062

would direct the SEC to conduct time- and resource-intensive

assessments after it adopts or amends major regulations

before the impacts of the regulations may have occurred or be

known. The bill would add analytical requirements that could

result in unnecessary delays in the rulemaking process,

thereby undermining the ability of the SEC to effectively

execute its statutory mandates.

The Administration is committed to a regulatory system that

is informed by science, cost-justified, and consistent with

economic growth. Through efforts including Executive Order

13579, ``Regulation and Independent Regulatory Agencies,''

the Administration is taking important steps to encourage

independent agencies to follow cost-saving and burden-

reducing principles in their reviews of new regulations, and

to examine their existing rules to identify those that should

be modified, streamlined, or repealed.

Mr. Chair, how many minutes do I have left?

I yield myself the balance of the time.

In closing, allow me to quote one of the Financial Services Committee members in a hearing yesterday, because I think it is so important for us to understand that the SEC is our cop on the block that has the responsibility for protecting investors.

Let us understand that my colleagues on the opposite side of the aisle are opposed to the SEC having an adequate budget. They do everything that they can to cut the budget, to deny the resources; but they keep adding on additional responsibilities, recognizing that the SEC has a tremendous load. Not only do they have all of the work, the cost-benefit analysis that they do on everything, but they have the responsibility of rulemaking for all of Dodd-Frank, which is the reform legislation that will cause us to eliminate risk and to protect our constituents and the citizens of this country.

But let me just say that yesterday, during a Financial Services Committee hearing, Chairman Emeritus Spencer Bachus said that it would be penny-wise and pound foolish for there not to be a bipartisan agreement for raising the funding or increasing the funding for the

Mr. Chairman, I claim time in opposition to the amendment, although I do not oppose the amendment.

Mr. Chairman, I yield myself such time as I may consume.

This amendment adds a requirement that the SEC analyze the number of jobs created or lost as a result of a new rule or order, while differentiating between public and private sector jobs.

Although this amendment is not by itself problematic, it layers one more requirement onto a bill already bursting with onerous cost-benefit requirements. And while counting the jobs created or lost because of a particular regulation is a noble goal, we have to view this goal in the context of the overall bill, which tips the scales heavily in favor of industry over investors, including the pension plans for millions of Americans.

The criteria by which the SEC would need to engage in cost-benefit analysis under H.R. 1062 would have the Commission make all decisions on the basis of whether the rules impose the least burden on ``market participants.'' In fact, nowhere in the bill are the words ``investor protection'' used, despite the fact that a central mission of the Securities and Exchange Commission is to protect investors.

Let's be clear: H.R. 1062 is essentially a solution in search of a problem. This bill is not about refining the SEC's cost-benefit analysis. The Commission, in fact, has already done that by adopting a new set of guidelines to ensure that its analysis meets the very high bar set in the decision overturning their proxy access rule. Instead, this bill is about making it easier for industry groups to overturn SEC regulations in the courts.

After the 2008 financial crisis, the public spoke; and they demanded that Congress stand up and legislate rules of the road to prevent another crisis. So we took action to regulate the over-the-counter derivatives market, improve corporate governance, implement the Volcker rule to stop commercial banks from gambling with depositor money, and to reform the credit ratings agencies that slapped AAA ratings onto toxic securities.

Having lost that battle here in Congress, the industry--with the help of some of my colleagues on the other side of the aisle--is now waging a new, quiet battle to have these regulations thrown out in court. H.R. 1062 abets that goal by making it significantly easier for the industry to win in court. This is a key differentiation from the President's executive order on cost-benefit analysis, whose requirements cannot be used as a basis for litigation.

So, again, this amendment is harmless, but it amends what is a deeply problematic bill.

I yield back the balance of my time.

Mr. Chairman, I claim time in opposition to the amendment.

I yield myself such time as I may consume.

Mr. Chairman, this amendment doubles down on all of the problems raised by H.R. 1062 by imposing the same burdensome cost-benefit analysis requirements on the Municipal Securities Rulemaking Board, or MSRB, and certain self-regulatory organizations as the underlying bill imposes on the SEC.

Beyond the problems caused by H.R. 1062, this amendment would further put individual citizens and taxpayers at risk by tying the hands of the MSRB, which is entrusted with regulating dealers of municipal securities, including city bond issuances.

The Wall Street Reform Act expanded the mission of the board to protect State and local governments and to regulate, for the first time in history, the individuals who provide municipalities with financial advice.

We had good reason to expand the mission and responsibilities of the MSRB under Dodd-Frank. Like many borrowers who were sold exotic mortgages based on the representations made by mortgage brokers in the lead-up to the financial crisis, we saw that many municipalities entered into complex financial instruments that they didn't fully understand. At the same time, we saw that many financial advisers to municipalities were involved in pay-to-play scandals and recommended unsuitable investments, particularly to small communities. The result was the imposition of substantial costs on taxpayers in communities across the country. The most high-profile example is the case of Jefferson County, Alabama, which entered into the largest municipal bankruptcy in history after a simple sewer bond financing deal ended with the county going broke over faulty interest rate derivatives.

This amendment will make it much more difficult for the MSRB to regulate the financial entities selling these derivative products to our small counties, cities, and towns.

But that's just one example. The amendment would impose similar onerous requirements on the Financial Industry Regulatory Authority-- that is FINRA--the self-regulatory organization for broker-dealers, and the Public Companies Accounting Oversight Board, which regulates the auditing industry.

Again, this amendment doubles down on what is already a harmful bill by extending the same onerous requirements of self-regulatory organizations. I see no reason why the Congress would want to further tip the scales in favor of Wall Street over Main Street.

I reserve the balance of my time.

I yield the balance of my time to the gentleman from Georgia (Mr. David Scott).

Mr. Chairman, I demand a recorded vote.

Thank you very much.

Mr. Chairman and Members, I would like to thank the gentlelady from New York for bringing this amendment today. As a matter of fact, the opposite side should thank her, too, because she is giving them an opportunity to back out of this awful bill that will be harmful and that is ill-informed and to get

on with just saying that her resolution would make good sense. So I am eager to support this amendment from the gentlelady from New York.

The amendment strikes all bill text and replaces it with a sense of Congress, reiterating all the economic analysis requirements already imposed on the SEC.

Specifically, current law requires the SEC to conduct economic analyses pursuant to the Paperwork Reduction Act, the Congressional Review Act and the Regulatory Flexibility Act, as well as additional cost-benefit analysis per the National Securities Markets Improvement Act.

Mr. Speaker, I have a motion to recommit at the desk.

In its current form, I am.

This is the final amendment to the bill, which would not kill the bill or send it back to committee. If adopted, the bill will immediately proceed to final passage, as amended.

This motion ensures the ability of the SEC to continue to protect investors and enforce the securities laws. I want to emphasize that this motion does not stop the bill, but it does flag the very important ways in which we need to let the SEC act. The motion would ensure that the SEC can protect investors and enforce the securities laws in two specific areas:

First, the motion will ensure that this bill does not reduce the ability of the SEC to protect the pension plans of our firefighters and police, the people on whom we rely as our first responders, as well as the pension plans of teachers and other retirees against fraudulent and deceptive practices. Protecting investors is a core element of the SEC's mission and one that we ignore at our peril. This week is Police Officers Week. Do we really want to honor our men and women in service by stripping them of protections for their hard-earned and hard-won earnings? Mr. Speaker, these protections become ever more crucial as we rely increasingly on the securities markets for our retirement savings.

Second, the motion to recommit focuses on protecting investors by ensuring that the SEC can protect against the takeover of American firms by foreign companies, particularly Chinese companies, that are using such mergers to access the investor funds in our capital markets without going through the SEC registration process. The SEC has had numerous enforcement actions against such companies which purchase a small company and merge it with a larger, often fraudulent, foreign company. It has worked hard to protect the savings of hardworking Americans, including union pension holders and other pensioners, from being disadvantaged by these Chinese firms that don't play by the same rules.

Both of these areas highlight the importance of SEC action to protect investors, particularly those preparing for retirement. With Americans increasingly dependent on the securities markets to protect their retirement savings, it is more critical than ever to ensure that we preserve the ability of the SEC to act.

Just yesterday, we heard from the SEC's new chairwoman, Mary Jo White. When we asked her about this bill, she said that she found it ``very troubling.'' I don't imagine that a former prosecutor who took on the Mob and terrorists is easily troubled. Indeed, she said that she had already needed at least 45 new economists to meet the need for an expanded economic analysis under the SEC standards, but she couldn't hire them due to the sequester. This is troubling indeed.

Rather than helping the SEC to do its job better, we are cutting its budget and throwing up new roadblocks, like this bill. It is a mistake. I urge my colleagues to support this motion, and I yield back the balance of my time.

Mr. Speaker, I demand a recorded vote.

Mr. Chairman, I will include for the Record a document from the Institute for Agriculture and Trade Policy, and I rise in strong opposition to this bill. To cater to special interests, it deliberately weakens the essential regulatory and oversight functions of the Commodity Futures Trading Commission, and it fails to address the CFTC's biggest challenge--its flawed funding mechanism.

Simply put, this bill is a recipe for another disaster on Wall Street, like the one that caused the Great Recession. Americans want to see more accountability from big banks and oil speculators and fewer reckless transactions, market failures, and bailouts. That is what the CFTC's job is, to rein in gambling with risky derivatives on Wall Street and prevent undue speculation on oil.

Unfortunately, this bill goes in the wrong direction. It includes provisions that will make it harder for the CFTC to regulate derivatives transactions between the United States and foreign banks. It goes out of its way to impose new hurdles and litigation risks to prevent the Commission from doing its job. It fails to address the CFTC's flawed funding mechanism, hamstringing its ability to create fair and transparent derivatives and futures markets.

The CFTC is the only financial regulator that is completely dependent upon the general fund to provide for its operations. Every other financial regulator--SEC, FDIC, FHFA, the list goes on--collects user fees.

Fixing this structural flaw has been proposed by every President since Ronald Reagan. It is all the more important since Congress greatly expanded the CFTC's responsibilities 4 years ago in response to the bad behavior that precipitated a devastating financial crisis.

According to Acting Chairman Wetjen:

The unfortunate reality is that, at current funding levels,

the Commission is unable to adequately fulfill the mission

given to it by Congress.

I submitted an amendment that would have addressed this flaw, yet the House majority refused to allow it to be heard.

We should not undermine the CFTC's ability to oversee risky market behaviors, protect consumers, and enforce the law. I urge a ``no'' vote.

Institute for Agriculture

and Trade Policy,

June 16, 2014.

Representative,

House of Representatives, Washington, DC.

Dear Representative, I write on behalf of the Institute for

Agriculture and Trade Policy (IATP) a non-profit, non-

governmental organization based in Minneapolis, MN to urge

you to vote against H.R. 4413, ``Customer Protection and End

User Relief Act.'' A vote for H.R. 4413 annuls or amends

major portions of Title VII of the Dodd Frank Act Wall Street

Reform and Consumer Protection Act (DFA) and per Title 1V's

retro-active application to July 2010, makes regulations and

guidance issued under the DFA authorities vulnerable to legal

challenge by the regulated entities.

Furthermore, if enacted, H.R. 4413 would impede DFA Title

VI implementation by, among other measures:

1) preventing the cross-border application of DFA

authorized rules unless the Commodity Futures Trading

Commission and the Securities Exchange Commission jointly

determine that foreign jurisdiction rules are not ``broadly

equivalent'' to DFA rules (Section 359);

2) micro-managing the CFTC Division Directors, Chief

Economist and staff (Sections 204, 205 and 206);

3) micro-managing and possibly impeding CFTC enforcement

activities (Section 209);

4) imposing cost-benefit analysis of each CFTC rule prior

to implementation, and as

required of no other independent agency, under terms that

would paralyze CFTC rulemaking that did not conform to

industry demands (Section 203); and

5) by requiring that CFTC voluntary guidance to industry be

subject to the same Administrative Procedures Act (APA)

requirements as for legally binding rulemakings (Section

212).

IATP began to work on commodity derivatives issues in June

2008, when grain elevators stopped forward contracting with

farmers and rural banks stopped loaning to elevators, due to

extreme price volatility and price levels in commodity

derivatives markets, which resulted from excessive

speculation by financial institution. IATP has participated

in the Commodity Markets Oversight Coalition (CMOC) since

2009, and the Derivatives Task Force of Americans for

Financial Reform (AFR) since 2010. 1ATP has contributed to

and signed on to numerous CMOC and AFR letters in support of

Title VII of the DFA. IATP has submitted several comments on

CFTC rulemaking, and on consultation papers of the

International Organization of Securities Commissions, the

Financial Stability Board, the European Securities and

Markets Authority, and the European Commission's Directorate

General for Internal Markets.

H.R. 4413 offers terrible trade-offs that no member of

Congress should be forced to vote for. As H.R. 4413 is

constructed, you can only vote for the widely agreed customer

protections in Title 1, if, e.g. you also vote to require the

CFTC Commissioners to vote on the length of a subpoena, the

renewal of the subpoena and whether the Division of

Enforcement has a ``legitimate purpose'' for each

investigation it undertakes (Section 209). Title 1 could and

should be proposed as a separate bill, for which you should

be able to get sponsors from Republicans, as well as

Democrats.

IATP also requests that you propose and vote for deletion

or amendment of certain sections of the bill, because its

passage is very likely. It is crucial that there be recorded

votes on all amendments to or deletions of H.R. 4413. Here

are IATP's top five priorities for deletions, since

amendments may not be possible, given the short amount of

time before the amendment deadline of Tuesday at 3 p.m. ET.

1. Section 359: This section (paragraph a) first requires

the CFTC to issue rules jointly with the Securities Exchange

Commission on the cross-border application of DFA rules. The

CFTC has authority over about 96.5% of the gross notional

value of the U.S. derivatives market, whereas the SEC has

authority over 3.5% of this market. The SEC has authority

over just one asset class of derivatives, equity-based

derivatives. The House would give equal rulemaking authority

with the CFTC to an agency that has historic competence and

legal authority for only a small sliver of the derivatives

market. This section further seeks to impede the CFTC's

ability to apply DFA authorized rules to foreign affiliate

swaps of U.S. swaps dealers that have a ``direct and

significant'' impact on the U.S. economy (Sect. 722, DFA). It

does so first by requiring that the CFTC's international

memoranda of understanding (MoUs) with foreign market

regulators comply with APA requirements for binding

rulemaking (paragraph c). MoUs are not binding rules, but

diplomatic agreements whose implementation and enforcement

does not depend entirely on U.S. law or regulations. Here,

again, H.R. 4413 seeks to micro-manage the CFTC's work, this

time in negotiations with foreign governments.

Most perniciously, Section 359 grants a blanket exemption

from compliance with DFA authorized derivatives rules for

``Countries or Administrative Regions Having Nine Largest

Markets,'' [sic] unless the CFTC and SEC ``jointly determine

that the regulatory requirements'' of these countries and

regions are not ``broadly equivalent'' to U.S. regulatory

requirements (paragraph d). Given the aforementioned huge

disparity in the ``market share'' of the CFTC's and SEC's

authority over the swaps market, this co-determination

requirement is grotesque. Furthermore, taking into account

the markets in the 28 member states of the European Union,

plus the next eight largest market jurisdictions, Section 359

exempts more than 90 percent of the foreign swaps market from

compliance with the cross-border application of the DFA. The

seven largest U.S. bank holding companies have 4939 foreign

subsidiaries and thousands of more affiliates. Trading losses

by these subsidiaries and affiliates resulted in default

cascades by their U.S. parent companies, saved from

bankruptcy only by at least $19 trillion in emergency loans

from the Federal Reserve Bank, plus $10 trillion to foreign

central banks to bail out their banks with U.S.

affiliates from 2007-2010. The regulatory regimes of the

foreign jurisdictions to which the Fed loaned at ultra-low

interest rates had been judged to be ``broadly

equivalent'' during the Bush Administration.

2. Section 203: Cost Benefit Analysis. The CFTC, unlike

other independent regulatory agencies, is required to do a

cost-benefit analysis prior to each regulation it issues.

This section does not operate consistently with Executive

Order 13563, as House supporters claim, since 13563 applies

only to non-independent agencies.Paragraph H requires the

CFTC to tabulate the costs of compliance by ``all regulated

entities,'' in effect requiring the CFTC to accept as fact

the compliance costs claimed by the regulated entities. These

claimed compliance costs often have been shown to be wildly

overstated. Paragraph J requires that the CFTC demonstrate

prior to implementation that each of the agency's regulatory

approaches ``maximize net benefits.'' These two paragraphs

alone should ensure that DFA authorized rules are not

implemented unless they satisfy the cost-benefit demands of

the regulated entities. Ex-ante cost-benefit analyses

traditionally are done on the basis of econometric modeling,

and not by the peculiar dependence on regulated entity claims

featured in this section.

3. Section 209: Subpoena duration and renewal. This section

authorizes the Commissioners to determine the length of a

subpoena that the Division of Enforcement shall use to compel

testimony and production of documents relative to an

investigation. It will require the Commission to vote on

whether the Division of Enforcement has a ``legitimate

purpose'' for requesting the subpoena, what the duration of

the subpoena will be and whether to renew the subpoena. Well-

funded subjects of an investigation will be advised by their

lawyers to delay complying with any subpoena in the event

that a majority of Commissioners decides to override the

Division of Enforcement and not renew a subpoena. It is one

thing to disagree with an investigation. It is quite another

for the House to vote for a section that would impede

enforcement of the law.

4. Section 204: Division Directors. This section requires

that each Division Director report to and be reviewed

(``serve at the pleasure of'') by each Commissioner. In the

event that the Commissioners disagree about any activity of a

Division, the Division Director could be taking contradictory

instructions from the Commissioners. Disagreements among

Commissioners must be resolved among the Commissioners and

not transmitted to Division Directors in the form of

contradictory orders. This section offers a high degree of

opportunity for one Commissioner to paralyze the work of the

Commission. At best, the section ensures delay of DFA

implementation through Commission micro-management of

Division Directors and the staff (see also our Comments on

Section 205 and 206).

5. Section 353: While the title of this section indicates

that it would give ``relief'' from record-keeping to farmers

and grain elevator participants in the derivatives market,

the application in the exemption from record-keeping could

and almost certainly will be applied to much larger

participants in the derivatives markets. By requiring only a

written record of the final agreement of swaps for

participants in unregistered designated contract markets or

swaps execution facilities, this section precludes the CFTC

from seeking interim documentation of swaps transactions,

including cell phone records if needed. This section makes

constructing audit trails in investigations more difficult

and otherwise limits enforcement activities.

Other sections that IATP believes you should consider for

deletion from HR 4413 include:

Section 205: The Office of the Chief Economist. This

section requires that the Chief Economist report to and be

reviewed by each Commissioner. Our concerns are the same as

those of Section 204.

Section 206: This proposal to require a seven day advance

notice to review each and every staff letter and to allow the

Commission to delay, review and revise staff letters, puts

the Commission in charge of micro-managing the staff. Many of

the staff no action letters that are the subject of the

complaint in the House agricultural committee report on HR

4413 are the result of the need to reply to industry

questions and complaints, and to postpone compliance by

foreign affiliates of U.S. swaps dealers, as foreign

jurisdiction rulemaking is delayed by industry opposition. A

staff whose budget, personnel and computer infrastructure has

been severely constrained by the House has operated as

efficiently and effectively as their meager resources allow.

This section is not an attempt to improve CFTC transparency

and openness but another tactic to micro-manage the staff.

Section 211: Requires that CFTC voluntary guidance to

industry be subject to the same Administrative Procedures Act

(APA) requirements as legally binding rulemakings. This

section represents the plaintiff's position in a court case

involving the CFTC's guidance on the cross border application

of DFA rules and would pre-empt the result of that case. If

the House wishes to require that APA procedures for issuing

guidance are the same as for rulemaking, it should amend the

APA, rather than single out one agency for this peculiar pre-

emption of a court ruling and unique application of the APA

to one agency.

Section 212: This section allows plaintiffs to file a

lawsuit in the District of Columbia or ``in the circuit where

the party resides or has the principal place of business''

(paragraph a). If the CFTC were a self-financed regulatory

agency or had a budget corresponding to its greatly expanded

duties under the DFA, the extra costs of litigating outside

the District of Columbia might not be a financial burden for

agency. Given the House's budgetary expression of hostility

to the CFTC, this section represents another tactic to

increase the burden on the agency to defend the DFA in court.

Section 362: One of the advantages of trading Over the

Counter is the delay in reporting, relative to the near real

time reporting required of exchanges for futures and options

contracts. OTC traders take advantage of price, volatility

and other information provided by the public and regulated

markets while providing no information of their own, a huge

competitive advantage. This section would allow traders of

uncleared and ``illiquid swaps'' to delay reporting up to 30

days after a trade's execution, an eternity in financial

markets, to protect the identity of individual traders.

Because swaps can be structured to be illiquid, this section

does not consider that the exemption from reporting in near

real time could be part of a regulatory evasion strategy. If

the industry wishes to petition the CFTC for a reporting

exemption on illiquid swaps, let it do so. Legislators should

not be involved in designing reporting exemptions.

Section 355: The asset class indiscriminate de minimis of

$8 billion of swaps dealing before a swaps dealer is required

to register with the CFTC and be subject to CFTC rules may be

lowered only with a vote of the Commission. It is dangerous

to remove the CFTC's regulatory discretion in determining the

justification for a de minimis. Whereas $8 billion of

interest swaps is a low de minimis relative to the more than

$150 trillion annual gross notional value of interest rate

swaps, an $8 billion de minimis is a very, very high de

minimis for commodity swaps. Again, here is another section

where the House is acting to micro-manage the CFTC's

rulemaking discretion and authority.

In sum, notwithstanding Title I on customer protections and

some sections of Title II and III, HR 4413 is a bill that

reauthorizes the CFTC, only to impede it from carrying out

its statutory duties. IATP urges you to vote against this

bill and to vote to delete the aforementioned sections. I

would be pleased to work with your staff on any amendments or

deletions that you may wish to offer. Thank you for your

consideration of our views on HR 4413.

Respectfully,

Steve Suppan, Ph.D.,

Senior Policy Analyst.

Mr. Speaker, I yield to the gentleman from Texas (Mr. Brady) for the purposes of inquiring of the schedule for the week to come. Mr. Brady, as I understand, is the designee of the majority leader, and I welcome and appreciate his participation.

I thank the gentleman for that information and, again, I want to thank him. I know that the majority leader could not be here and he's filling in, and I appreciate the fact that he is doing so.

Mr. Brady, I notice that there is not on the notice for the schedule for next week any reference about a motion to go to conference on the budget. As you know, the Senate has now passed a budget, which it had not done for some years. Your side, in particular, but all of us wanted the Senate to pass a budget. They have now passed a budget. We passed a budget. We would hope on this side of the aisle that we would now go to conference.

I'm wondering whether the gentleman can--in light of the fact that it is regular order that two sides pass, now try to compromise the differences that exist between the two Houses--can the gentleman tell me whether or not there is a plan to go to conference and, if so, what that schedule might be? And I yield to my friend.

I appreciate the fact that you're encouraged. Frankly, our side has not heard an encouraging word. In fact, we continue to hear discouraging words, as the song says.

I'm very hopeful we can bridge the gap that exists, which is about $100 billion, as the gentleman knows. The Senate marked $1.058 trillion, which of course was consistent with the Budget Control Act that we agreed upon, we voted on, and passed. The President signed the Budget Control Act, including that figure for the fiscal year '14 budget. The Ryan budget, as you know reflects a $966 billion 302 allocation; that is, general discretionary spending levels.

I'm wondering when you say you're encouraged, do you know whether there's been any progress toward trying to bridge that gap? Obviously, as a former appropriator, many times it's 50/50 you come to the middle, which would be about $1 trillion or a little more than that. I'm wondering whether or not the gentleman knows whether any progress has been made on that? And I yield to my friend.

I thank the gentleman.

Just let me observe that on our side we think it would be useful if the American public had the opportunity to, in effect, see the discussions in a conference. I've been here long enough to remember when we had conferences on the Appropriations Committee. They were open to the public. They were reported on. We had discussions about the differences that existed, as one would expect, from people elected from different parts of the country and with different views. But we think it would be very helpful if those discussions were held, because the differences are pretty profound and pretty significant, that it would help the public to have a better understanding of the process.

In addition, as the gentleman knows, of course, there was some discussion about the President's coming down late with his budget. We should have been through the budget process by now so that the Appropriations Committee could proceed with its allocations to its 12 subcommittees.

In that context, I would ask the gentleman, does the gentleman have any idea when the appropriations bills might be marked up and brought to the floor? As you know, under regular order, for the most part, we have brought appropriations bills to the floor starting in mid-May or the last week in May so that we could get through that process in June and July and send those bills to the Senate so that we might have conferences and complete our work by October 1.

And I yield to my friend.

Well, I appreciate that and I look forward to the consideration of the appropriations bills on the floor.

I want to say that for the most part you have followed open rules, which we did as well in 2007 until we just couldn't get the bills done in a timely fashion. Hopefully, we can do that, because I think that, again, it gives the public the opportunity to see the priorities of not only each Member but both sides moving forward. I think that's appropriate in a democracy. I appreciate the fact that the majority leader intends to bring those bills to the floor starting in June. I'm not sure whether we can finish all 12 in June, but perhaps finish those in July.

We did not bring, as the gentleman knows, the Labor and Health bill to the full committee in the last cycle, much less to the floor. That bill will be tough.

Chairman Rogers--I know the gentleman is on a committee that he believes is more important. He and I may differ in that perception. He's a member of the Ways and Means Committee, I was a former member of the Appropriations Committee. But, nonetheless, Mr. Rogers has made the observation, in terms of the dollars allocated in the Ryan budget for discretionary spending, both on the defense side and nondefense side:

I suspect there will be some who will be shocked. I don't

think people yet understand how severe the numbers will be.

Those numbers refer to the $966 billion in discretionary spending, which will require deep cuts in almost every program on the national defense side and on the discretionary side.

So, the sooner we get to that, because I think it's going to be a difficult process, the better. And I appreciate your information with reference to the majority leader's intent to bring them to the floor.

Now, I also did not see on the schedule, Mr. Brady, anything that deals with the sequester. I do see the Affordable Care Act repeal on the floor next week, which has been, of course, on this floor some 33, 34, 35 times before, to repeal it. We're having another repeal vote coming up. I think honestly you believe, as I believe, that that bill is not going to go anywhere, other than perhaps through the House of Representatives, but, beyond that, it won't go anywhere.

However, the sequester continues to be an ongoing challenge to our country, to our government, and to our people. We dealt with it in a sort of surgical fashion dealing with the FAA, but we have not dealt with any of the other concerns. As the gentleman knows, I have concerns about the fact the sequester may result in 70,000 children not being on Head Start. They are only 3 or 4 years of age once.

The Social Security Administration may have to furlough payments, which will slow down payments of Social Security. There are 4 million fewer Meals on Wheels for seniors. There are 600,000 people who have been dropped off the Women, Infants, and Children program. There are 125,000 fewer HUD rental assistance vouchers for people who are homeless or who are struggling to keep a home. Unemployment insurance has been cut 11 percent for 2 million out-of-work Americans. We now have no safety net for them. The FDA will have 2,100 fewer food safety inspectors--that's down 18 percent--obviously, putting at risk our food safety; and we will furlough an equivalent to 1,000 fewer Federal agents, FBI--we know from the Boston Marathon bombings how critical the FBI was--and border security. One-third of combat air units have been grounded.

I mention all of those simply in the context of those consequences of the sequester. I see it's not on next week, and we have a week after that that we'll be in session. Does the gentleman have any information with reference to whether or not we will deal with trying to ameliorate these adverse consequences of sequester before we leave here for the Memorial Day break?

And I yield to my friend.

I thank the gentleman for his comments; but I do want to observe that the President of the United States has offered a budget which eliminates the sequester and gets to a budget deficit reduction and fiscal sustainability in an alternative way which we think is much more positive.

I would also remind the gentleman that Chris Van Hollen, the ranking member of the Budget Committee, offered an alternative which gets rid of the sequester, which all sides agree is an irrational process in that it cuts the highest priority and lowest priority the same. The sequester, as the gentleman knows, was put in a bill to force action with the specific belief and premise that the sequester was so bad, so irrational, so lacking in common sense, so negative in its impact that it would never be adopted. Sadly, it was adopted.

I want to say also that the gentleman and a lot of his colleagues like to mention that this is the President's suggestion. With all due respect, Jack Lew brought it up with Mr. Reid, and everybody has read about that in Mr. Woodward's book. He brought it up, however--and the gentleman probably recalls this--days after sequester, as a policy, was included in the Cut, Cap, and Balance bill for which 229 Republicans voted for as a policy. I want to

tell the gentleman just for his future information, on our side, we are opposed to the sequester. We want to see the sequester changed.

Mr. Van Hollen not only offered a budget, but he offered four amendments. Each time we considered the CR and other legislation, four times he offered an amendment to substitute the same savings so we would get to those budget deficit reductions to which the gentleman spoke, but would not do so in the irrational, across-the-board fashion that sequester requires.

So I want to make it clear, if there was any confusion on your side of the aisle, we are not for the sequester. I voted for the CR to keep the government open, but I voted against the CR, when it left this House, which had sequester in there. I, frankly, thought shutting down the government was even worse than the sequester, but I think the sequester is having a harmful effect, not only on government, but a harmful effect on our economy. I think it's a drip, drip, drip. It wasn't a ``shut the door.'' It wasn't black and white. It wasn't overnight, but it is a drip, drip, drip that is harming our economy.

I understand what the gentleman has told us, but I would hope that we would seriously consider trying to see if we could reach agreement either outside the context of the budget conference or inside the context of the budget conference that would give us an alternative which would be more rational, more positive, and more helpful to our economy.

The next subject is simply the debt ceiling. We just passed a bill on the prioritization. We unanimously opposed that on our side. We think that is not a good policy. Obviously, there is a disagreement on that. May 19 is the date that the debt ceiling extension expires.

Can the gentleman tell me whether there is any proposal to act in the near future other than on debt prioritization, which will have no chance in the Senate and is roundly opposed by many Republican economists, as the gentleman knows, and by the former economic adviser to the Bush administration, who said that it would not work, should not work? Can the gentleman tell me whether there is any alternative plan, before we leave here for the Memorial Day break, to give confidence to the economy and to creditors and to the American people that we will deal responsibly with the debt limit extension?

And I yield to my friend.

I thank the gentleman. Of course, we did have a balanced budget, as you'll remember, for the last 4 years of the Clinton administration. Now, there was a Republican-controlled Congress; but in the next 4 years, there was a Republican-controlled Congress, a Republican-controlled Senate, and a Republican President, and we went deeply into debt.

We escalated the debt during the Bush administration by 87 percent of GDP more than this President has escalated the deficit. In nominal terms, as Mr. Camp observed before, the dollars are higher. That's true. It's because we are bigger, spending more money, making more money as a country. GDP is up.

During the Reagan administration, we increased the debt as a percentage of the national GDP by 186 percent; 55 percent under George Bush; 37 percent under Mr. Clinton; and some 40-plus percent under this President today.

So I think the gentleman and I agree that we need to get a handle on the debt and the deficit, but we disagree on how this happened. It happened because we didn't pay our bills, and we jettisoned PAYGO in 2003. As a practical matter, we jettisoned it in 2001.

Not paying for things is what creates debt, not buying. If I buy things and I pay for them, I don't have a debt. If I buy things and don't pay for them, I have a debt.

So it's not a question of what I buy, although clearly we need to restrain buying and we need to constrain spending, as I've said, all across the board--the gentleman has heard me--including entitlements, including discretionary defense and nondefense spending. But what we ought to do is manage our finances in a way that does not give pause to the American people or to the economy.

I want to just read for you a quote. Keith Hennessy was George Bush's National Economic Council director who disagrees with your proposition that this prioritization will in any way stabilize--I don't think the gentleman disagrees with me that that bill is not going to pass the Senate. Here's what Keith Hennessy said:

Payment prioritization doesn't stop payments; it just

delays them. Then the aggrieved party sues the government and

probably wins, and it turns into a bloody mess.

Tony Fratto, who was the spokesman on economic policy in the Bush administration said this:

Prioritization is impossible. Is the government really

going to be in the position of withholding benefits,

salaries, rent, contract payments, et cetera, in order to pay

off Treasury bondholders?

We refer to this, of course, as the Pay China First bill. And China ought to be paid. We borrowed money from them; we ought to pay them.

Here's what he concludes of the prioritization bill:

That would be a political catastrophe.

I suggest it would be an economic catastrophe, as well, to say to our armed services personnel, We're not going to pay you, but we are going to pay China for our debts.

The fact of the matter is the United States is the most creditworthy Nation on Earth. We ought to pay all of our debts and not on a priority status. If we owe you as the United States of America, we're going to pay you. That's our proposition. We should not prioritize paying simply bondholders, but paying smaller contractors we are doing business with who offer us services and products and we don't pay them until after we pay our bondholders. We ought to pay everybody. That's what America is about.

So I would hope that we could revisit this because your debt prioritization is not going to pass. You know it's not going to pass. We need to get to a responsible way of dealing with the debt-limit extension.

Both parties, I will tell my friend, have demagogued on this issue. We demagogued on it when we had a Republican President; you've demagogued on it--not you personally. I cast no aspersions. But both sides have demagogued on it when the President was of the other party. It's a shame. It's not been good for our country.

Ronald Reagan said that Congress continues to run us up. And we ran us up so close last time that for the first time in history, the United States of America was downgraded by one of our

rating agencies. I would hope the gentleman who serves on the Ways and Means Committee and I and others could work together so this doesn't happen again, that we make sure that the American people and that all of our creditors and people around the world know that the United States of America can and will handle its finances in a responsible fashion.

If the gentleman wants to say anything further, I'll yield back to him; if not, I yield back the balance of my time.

Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days within which to revise and extend their remarks and submit extraneous material for the record on H.R. 1062, the SEC Regulatory Accountability Act of 2013.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, I rise today to urge the adoption of H.R. 1062. This is a bill that technically is about something called cost-benefit analysis. I know to some that sounds a little bit like Ph.D. economics, but, Mr. Chairman, what it's really about is kitchen-table economics.

When I go home to the Fifth District of Texas, what I hear from my constituents is that they're insecure in their jobs--those who are lucky enough to have them.

We know that millions of our fellow citizens are unemployed, are underemployed; and those who are fortunate enough to have jobs wonder will they have them tomorrow.

We know again that we are in the Great Recession, the ``non- recovery'' recovery. So the impact of the regulations that are promulgated in Washington, D.C. has a huge impact on kitchen-table economics, on whether or not our constituents are going to be able to put gas in the car to take their children to school, whether or not they're going to be able to help an elderly parent with their medical bills, how they're going to put groceries on the table.

It is incumbent upon us, Mr. Chairman, to make sure that the rulemaking authority--that this body helps grant the executive branch-- at least has to take into account how their rulemaking impacts hardworking American citizens and those who wish to work hard.

So this is a very, very simple bill, Mr. Chairman. It simply says that the Securities and Exchange Commission has to adopt cost-benefit analysis to ensure that the advertised benefits of one of their rules is actually measured against the actual cost of what they're doing. This is vitally important.

Mr. Chairman, as you well know, this body had a vote yesterday to repeal the Affordable Care Act--or dare I say the Not So Affordable Care Act. And I'm curious, what would have happened had Congress had the benefit of the cost of this bill prior to that vote? What would have happened had we known that the Congressional Budget Office said that we will have 800,000--almost 1 million--fewer jobs because of ObamaCare?

You know, when we took that vote, Mr. Chairman, all we had were the advertised benefits. But how come we didn't have the Congressional Budget Office report of the cost? That's just one example. Almost 1 million fewer jobs because nobody bothered to conduct cost-benefit analysis. It wasn't required at the time.

Now the President claims that we ought to have this. He issued an executive order--No. 13563--saying government agencies ought to do it, but then his administration issues a veto threat on this bill. I find that kind of interesting. So the President says he wants to do it; he's just not actually going to do it.

The SEC mission, among other things, is to ensure that we help form capital. You cannot have the benefits of capitalism and the free enterprise system without capital, capital formation. So it's necessary to ensure that we look at the cost of what we're doing.

Apparently, the SEC historically--again, notwithstanding that they claim they're going to do it. Most recently, we've had a unanimous decision of the D.C. Circuit Court of Appeals--unanimous decision--in the proxy access case that the SEC failed--and failed miserably--at ensuring cost-benefit analysis, also known as kitchen-table economics. How are the costs of their rulemaking going to impact hardworking Americans?

It's time to remedy this, Mr. Chairman. Our constituents demand it.

Again, I urge the adoption of H.R. 1062, and I reserve the balance of my time.

I yield myself 30 seconds, Mr. Chairman, just to say that, number one, in listening to my colleague, the ranking member, I'm just curious about this concern about litigation burdens. We certainly didn't see it, as she and many of her colleagues back the proxy access rule, and how many have refused to support medical liability reform. So I don't understand why the litigation burden concern is not there.

In addition, I notice that the SEC has sought comment in the past on rulemaking to ensure that there is a retrospective look-back because markets change.

At this time, Mr. Chairman, I would like to yield 5 minutes to the chairman of the Subcommittee on Capital Markets and GSEs of the Financial Services Committee, the author of the legislation, the gentleman from New Jersey (Mr. Garrett).

Mr. Chairman, I yield myself 10 seconds just to say to my friend from New York that if this regime is so effective, why was there a unanimous decision in the D.C. Circuit Court of Appeals to say it was ineffective, and if it is already on the books then the worst thing that we have done is that we are being repetitive. I don't think that's such a great sin.

I now yield 2 minutes to the gentleman from Virginia, the vice chairman of the Capital Markets Subcommittee, Mr. Hurt.

Mr. Chairman, at this time, I yield 1\1/2\ minutes to the gentleman from Frog Jump, Tennessee (Mr. Fincher).

Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from North Carolina (Mr. Pittenger).

Mr. Chairman, at this time, I yield 1 minute to the chairman of the Financial Services and General Government Appropriations Subcommittee, the gentleman from Florida (Mr. Crenshaw).

I yield the gentleman an additional 30 seconds.

Mr. Chairman, I yield 2 minutes to myself.

I would like to do a little factual cleanup here, Mr. Chairman, on some things that my Democratic colleagues have said.

I believe I understood my friend, the gentlelady from Wisconsin, to say nowhere in this bill is the word ``benefits.'' First, I would say, number one, it is a 10-page bill, not a 2,000-page bill. And on the very first page, line 11, you read the word ``benefits.'' If you turn to page 2--not page 2,000--page 2, line 3: ``Utilize the Chief Economist to assess the cost and benefits.'' So let me correct that for the record.

Second of all, we had discussion about the failure of regulation and how this bill might lead to another Great Recession or financial crisis. I would point out to my friends that it was the failure to understand the cost of Fannie and Freddie, the failure to understand the cost of the affordable housing goals that put millions of our fellow citizens into homes that they could not afford to keep.

So maybe, just maybe, had this body and the other body realized the full cost of their folly and how it could not only bring this economy to its knees, that it could cause our fellow citizens to risk their meager lifesavings on homes they couldn't afford to keep, maybe had a cost-benefit analysis been in place at that time, we wouldn't have the suffering that we have today.

I would say to my friend from Connecticut, he is clearly talking to different economists and different job creators than I have because what I understand from them is that, frankly, we have trillions of dollars of capital sitting on the sidelines because of Dodd-Frank, because we have rulemaking that falls into two categories: those that create uncertainty and those that create certain harm.

Last, but not least, I actually have the numbers from CBO on the budget of the SEC. And I think if you examine them carefully, Mr. Chairman, you will discover that in a little over 10 years, this is an agency whose budget has increased 300 percent.

I reserve the balance of my time.

Mr. Chairman, I now proudly yield 1 minute to the distinguished majority leader, the gentleman from Virginia (Mr. Cantor).

Mr. Chairman, I yield myself 30 seconds to say to my friend from Georgia when he talks about the incredible burden of a retrospective look back, I would quote:

Because considerations of efficiency and competition in

capital formation evolve over time, a retrospective analysis

of the Commission's rules and regulations is fully within the

Commission's statutory mandate.

That comes from the ABA.

I would also quote this as well:

The safety of workers' retirement savings that are invested

in the capital markets depend in large part on the

Commission's rules and regulations for the protection of the

investors. To be effective, securities regulations must be

continuously updated to address the emergence of new

loopholes, abuses, and market failures.

Mr. Chairman, I would like to yield 1 minute to the author of the bill, the gentleman from New Jersey (Mr. Garrett).

Mr. Chairman, I'm under the impression I have the right to close, so the gentlelady has reserved. I will reserve until she is ready to close.

Mr. Chairman, how much time do I have remaining?

Mr. Chairman, I yield myself the balance of the time, although I will alert my colleagues I do not intend to take it all.

Mr. Chairman, I find it somewhat interesting the great amount of wailing and gnashing of teeth that we have heard on this House floor for a very simple bill that weighs in at, frankly, less than 10 pages that simply requires a government agency to decide is there going to be a cost to our economy, is there going to be a loss of jobs as they pass a rule. It doesn't overturn their rules. It just says, before you make a rule, you've really got to think about kitchen-table economics. You've got to take a look at and understand how will this ultimately impact hardworking Americans who are struggling to pay their health care bills, struggling to put gas in the tank and who have economic insecurity due to this economy.

So I've heard a lot of furor here. I must admit I'm particularly entertained by those who care to lecture me on what it means to be a conservative. Maybe I'm not the world's expert, but there was a time in my career my fellow colleagues elected me the chairman of the Conservative Caucus of the House, known as the Republican Study Committee. And, Mr. Chairman, I have a certificate in my office that I proudly display from the Americans for Democratic Action where they say Congressman Hensarling receives a zero percent liberal rating.

So I will certainly agree with my friends that, apparently, I don't know much about liberalism, but I do think I do know a few things about conservatism. So I'll come up with an informal agreement. We'll let you be the experts on what it means to be a liberal--and you're very good at it, to the best of my knowledge--and I will retain the expertise on how one votes conservative.

The next thing I would say, Mr. Chairman, is how fascinating it is to have so many of my colleagues say that this bill, on the one hand, is unnecessary, but, on the other hand, it's burdensome; on the one hand, it's redundant, but, on the other hand, it will stop the SEC in its tracks. Mr. Chairman, I just don't think you can quite have it both ways.

I notice when some can't argue the merits of a question, they tend to come up to question one's motivation, and we've got the usual Wall Street bogeymen to come in here. But what I want to know about is why, why would we not want to know, as some have estimated, that the Volcker rule promulgated by the SEC potentially could cost 1.1 million jobs in our Nation? And yet my colleagues from the other side of the aisle say, Shh, no, no, no, no, no. We don't want this information. We don't want it out. Just like we didn't want out the information that ObamaCare could cost us 1 million jobs.

And we see it every day. We get the headlines: people can't afford their health care, their premiums have gone up; people are getting laid off; people who had full-time jobs are going to part-time; and people who would have hired more people don't want to cross that 50-person threshold. And that's just ObamaCare. But, no, shh, we don't want--we don't want to know how this is going to impact hardworking Americans who have economic insecurity, millions who do not have jobs.

I am somewhat perplexed, Mr. Chairman, how such a simple bill that says all you've got to do is look at the cost--we're not imposing our numbers on them. We're just saying you've got to look at the cost of what you do. It's what families do; it is what job creators do; and, frankly, it's what the administration claimed they wanted to do, and it's what the SEC claimed they wanted to do.

How many of my Democratic colleagues with their words say ``yes'' but very soon with their voting card are going to say ``no''? No, we shouldn't know the cost of rulemaking. No, we just want to know what bureaucrats say the benefits are. But, you know, if people lose their jobs, well, que sera, sera. We just aren't going to--we don't want to know that ahead of time. Maybe we'll learn about it afterwards. Maybe we'll try to clean up the pieces, the shattered lives of people who lost their jobs.

Mr. Chairman, this is a false dichotomy set up by many of my colleagues on the other side of the aisle. The question is not between regulation and deregulation. The question is between smart regulation and dumb regulation. And smart regulation requires the rule makers to understand the cost of their rules to the average, hardworking American family. That's smart regulation. Dumb regulation is burying your head in the sand and saying, no, we don't want to know.

If we're so concerned about the burden on the SEC, if we're so concerned about the litigation burden, and if we're so concerned about the work burden and the rule burden, where's this same concern for the job creators of America? Where is that concern? You cannot help the job seeker by punishing the job creator, which is what so many of the different titles of Dodd-Frank do.

So at the end of the day, Mr. Chairman, this is as simple and as common sense as it could be. If you're going to pass a rule and you're going to tell us about the benefits, you've got to let us know what the costs are to the economy and to hardworking American families. It's common sense. We should adopt it. We should adopt it today.

I yield back the balance of my time.