Restoring Proven Financing for American Employers Act

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 5461) to clarify the application of certain leverage and risk-based requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act, to improve upon the definitions provided for points and fees in connection with a mortgage transaction, and for other purposes.

Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days with which to revise and extend their remarks and submit extraneous materials for the Record on H.R. 5461 currently under consideration.

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

Mr. Speaker, I rise today in support of H.R. 5461, a bill authored by the gentleman from Kentucky (Mr. Barr), my colleague on the Financial Services Committee, and cosponsored by Mr. Gary G. Miller of California and myself.

This bill contains four titles, three of which having already passed this House with overwhelming or unanimous support and one of which passed with only a dozen ``no'' votes.

Mr. Speaker, it is rare that the Senate sends us meaningful legislation; and, frankly, it is even rarer when they send us legislation that amends and fixes the Dodd-Frank Act. As we on the Financial Services Committee have seen in our hearings and our markups, our friends on the other side of the aisle and the other side of the Capitol usually defend Dodd-Frank to the hilt, bestowing on it deference normally reserved for the sacred texts handed down from the heavens.

Well, we should agree that Congress doesn't always get it right. When sweeping legislation is enacted--remember, Dodd-Frank is a 2,300-page bill--there are often areas that later need clarification, and that is exactly what we are talking about here today.

Whatever one's position is on Dodd-Frank, we should all be able to agree that the text is not sacred and does need some fixing. That is why I am pleased that the Senate has sent us a bill to clarify that regulators should not impose regulatory capital requirements designed for banking institutions on insurance companies. That was not what was intended.

The Senate bill, S. 2270, passed the other body unanimously. There is broad support in the House for a companion measure, but there is equally broad support for three other Dodd-Frank technical correction amendments that have previously passed this House: Mr. Barr's bill on the treatment of collateralized loan obligations under the Volcker rule, Mr. Grimm's bill to exempt end users from derivatives from Dodd- Frank's overreaching margin requirements, and my own bill on how points and fees are treated under Dodd-Frank's onerous qualified mortgage rule.

My legislation that is included in this package is a strong bipartisan provision that modifies and clarifies the way points and fees in a real estate transaction are calculated. This provision is narrowly focused to promote access to affordable mortgage credit without overturning the important consumer protections and sound underwriting requirements that Dodd-Frank's ability to repay provisions has in place.

Homeownership has been a pillar of American life for generations, and this particular provision will help more Americans realize this portion of the American Dream.

This bill is a commonsense measure that should and, I believe, does have broad bipartisan support. I was puzzled, however, by a Dear Colleague letter produced by Ranking Member Waters circulated earlier today. In the letter, she writes that Mr. Barr has coupled the insurance capital bill with other ``divisive legislation.''

Now, I would ask my friend the ranking member: What divisive legislation are you referring to? Is it the CLO bill which passed the House on voice vote? Is it the end user bill which passed the House on the ranking member's ``yes'' vote herself and only a dozen ``nay'' votes? Or is it my bill that also passed the House by voice vote? I don't see the divisiveness, and I don't see where the problem is.

The reality is Americans don't care about the parliamentary process so much as they want results.

We are pleased that the Senate has finally come to the table on Dodd- Frank reforms. This is legislation that represents a step forward in working with the other body to make sure that my constituents and your constituents can get mortgages to buy their first home, that farmers can assess the financing that they need to buy tractors and work their land, and that Americans can buy insurance policies without severe premium increases.

I encourage my colleagues to support H.R. 5461, especially my Democrats friends who I believe support every component of the package.

I reserve the balance of my time.

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

I wish I had actually asked if the gentlewoman would yield because I am confused. I am confused on a bill that she has voted three times--I am positive--three different bills, how that is divisive, how it is not targeted with significant Democrat support.

I personally with one of these bills--my bill has been sitting in the Senate since June. It has been targeted, it has had Democrat support, and it has had Republican support. We simply cannot get the Senate to move, and I am not sure why my colleague would support a Senate bill without any House input, but not expect the Senate to look at our material and to look at our bills.

Mr. Speaker, with that, I yield now as much time as he may consume to the gentleman from Kentucky (Mr. Barr) the author of this legislation.

Mr. Speaker, I yield an additional 30 seconds to my colleague from Kentucky (Mr. Barr), who would like to clarify.

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

I am curious why we are here. The House of Representatives is only going to pass Senate bills. I am curious why my colleagues would be willing to do that. I would love to hear from my colleagues, which overwhelmingly passed House bill does the Senate object to? We simply cannot get them to take our bills up.

I am glad to hear that my colleague, Mrs. McCarthy, is going to be supporting this bill package. I too am hopeful. But I do believe that this is not political theater, for the robust list of supporters, like credit unions, banks, insurers of all sizes, the entire real estate community and end-users strongly support the policies that are within this bill. And I do have that list available as well, which I will include for the Record.

So, Mr. Speaker, I am prepared to close, and with that, I reserve the balance of my time.

September 15, 2014.

Dear Members of Congress: The undersigned trade

associations, representing job creators across the country of

all shapes and sizes, write to urge your support for

bipartisan legislation recently introduced by Reps. Andy Barr

(R-KY), Gary Miller (R-CA), Bill Huizenga (R-MI), and David

Scott (D-GA). H.R. 5461, currently scheduled for floor

consideration on Monday, September 15th, includes important

technical corrections to the Dodd-Frank Wall Street Reform

and Consumer Protection Act that strengthen the underlying

Act and provide critical clarifications to better oversee our

financial system while allowing for economic growth.

The ongoing implementation of the Dodd-Frank Act has

revealed unintended consequences that have adversely impacted

job creation and economic growth. We believe that the Barr-

Miller bill, comprised of a series of noncontroversial,

thoroughly examined, bipartisan proposals will fix these

unintended consequences and help make financial reform more

workable and effective. Specifically, this legislation

contains the text of three bills previously approved by the

House (H.R. 634, the Business Risk Mitigation and Price

Stabilization Act; H.R. 3211, the Mortgage Choice Act; H.R.

4167, the Restoring Proven Financing for American Employers

Act) as well as one bill that recently passed the Senate (S.

2270, the Insurance Capital Standards Clarification Act) by

unanimous consent. In fact, three of the four titles of this

package have previously passed either the House or Senate

without one dissenting vote.

We urge your support for the Barr-Miller-Huizenga-Scott

bill to help foster job creation and economic growth.

Signed,

American Bankers Association; American Bankers Insurance

Association (ABIA); American Financial Services Association;

American Insurance Association; Consumer Bankers Association;

Consumer Mortgage Coalition; Community Mortgage Lenders of

America; Credit Union National Association; The Financial

Services Roundtable; The Financial Services Forum;

Independent Community Bankers of America; Leading Builders of

America; The Loan Syndications and

Trading Association; Mortgage Bankers Association; National

Association of Federal Credit Unions; National Association of

Home Builders; National Association of Mutual Insurance

Companies; National Association of Realtors; The Realty

Alliance; Real Estate Services Providers Council, Inc.

(RESPRO); Securities Industry and Financial Markets

Association; U.S. Chamber of Commerce.

Mr. Speaker, I am prepared to close, Mr. Speaker, and reserve the balance of my time.

Mr. Speaker, again, I am prepared to close, and I reserve the balance of my time.

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

I will address my remarks to the Chair, but, again, this is not about parliamentary procedure. This is about results.

The only bill that we will see here that may bring confusion to this entire process is the one that my colleagues are advocating for, the Senate bill. It is the only bill that we haven't dealt with in committee. It is the only bill we haven't had a vote on in the Houses. The other three bills have passed, two of them unanimously by voice vote, and the other one had 12 people, out of a body of 435, vote against it. Sounds like it is overwhelming. If it is that confusing to my colleagues to figure out what bill and how they voted for it when they come to the floor to vote on this package, they maybe should reconsider their current line of work. This should not be that tough.

This is, again, something that we need to move forward on. The political theater that seems to be happening here is on the other side. I am not sure why, if it is about trying to play to a base for an election issue or what, but this is the one time I think in the history of my working career that the whole is worse than the sum of its parts. This doesn't make any sense.

So there has not been bipartisan work on the underlying bill, Dodd- Frank, which I might remind my colleagues passed with zero minority Republican votes when the bill was passed. This package of bills has passed with overwhelming bipartisan support. I applaud my colleagues on the other side of the aisle when they oppose the Senate.

And I guess I needed to clarify that my comments about people acting like this is holy writ from the heavens does tend to be concentrated with my colleagues over in the Senate who apparently don't want to touch this or others in the administration who oppose the nine-bill package on derivatives reform that passed overwhelmingly bipartisanly out of our committee as well.

That is the kind of holdup that we have that is frustrating Americans, that is frustrating me as a policymaker and my colleagues, that is frustrating, frankly, future generations as they look in on this process.

It is time, Mr. Speaker, to pass this package of bills that includes three bills that this House has already dealt

with, that the Senate should have absolutely no opposition to or excuse why they will not take up.

With that, I again ask my colleagues to pass this particular bill, H.R. 5461, and look forward to its passage here soon.

I yield back the balance of my time.

Mr. Speaker, I thank the gentleman from New Jersey, my friend who has, himself, shown a considerable amount of leadership on this issue in making sure that American companies on Main Street and all across this country have access to reliable, affordable capital to grow their businesses and create jobs.

I also want to thank the gentleman from Florida for participating in the discussion here today in a bipartisan manner and for his support. And I also thank my colleagues both on this side and that side of the aisle for their support and for recognizing that we do need to fix this problem.

H.R. 4167, the Restoring Proven Financing for American Employers Act, is about jobs and economic growth. It is about reliable access to affordable credit to small, midcap, and emerging-growth companies, in fact, some of the most dynamic and job-producing companies in America.

As the U.S. Chamber of Commerce states in its letter of support, my legislation is necessary to ``fix the adverse impacts of the Volcker Rule upon thousands of Main Street businesses.''

This legislation, as has been mentioned earlier, passed out of the Financial Services Committee on a March 14 strongly bipartisan vote of 53-3. I want to thank Congresswoman Carolyn Maloney of New York for her support and work in developing this commonsense legislation to provide a necessary clarification of the Volcker Rule while maintaining the original legislative intent regarding the treatment of collateralized loan obligations.

While there are several exemptions provided in the statute included in section 619 of the Dodd-Frank law, which authorizes the Volcker Rule, that legislative language states:

Nothing in this section shall be construed to limit or

restrict the ability of a banking entity or nonbank financial

company supervised by the Federal Reserve Board to sell or

securitize loans in a manner otherwise permitted by law.

Nevertheless, despite this plain language in the statute, certain asset-backed securities originally thought to be exempt by the Volcker Rule are now subject to the covered fund definition.

So the pragmatic need to provide this defined, narrow fix is why the legislation is endorsed by the American Bankers Association, by the Kentucky Bankers Association, and by the small community banks around this country, the Independent Community Bankers of America. And it is why a small community bank in my home State of Kentucky contacted my office in January. He alerted us to the fact that failing to fix this problem could very well mean significant losses to that small community bank, possible layoffs of employees, and higher borrowing rates and fees for the customer in the local community.

So getting this issue right and fixing the problem is important to community banks. It is important to U.S. employers and businesses on Main Street. It is important to a whole lot of jobs that support families in Kentucky and around this country. And here is why: collateralized loan obligations, or CLOs, have proven to be a critical source of funding for U.S. businesses over the last 20 years.

Today, CLOs continue to provide over $300 billion in financing to U.S. companies, including companies that are well-known to all of us in this Chamber--Dunkin' Donuts, American Airlines, Burger King, Toys ``R'' Us, Neiman Marcus, Delta Air Lines, Goodyear Tire, and even a mattress and bedding company in my hometown of Lexington, Kentucky, Tempur Sealy. Yet, this valuable form of corporate finance that supports jobs is under assault due to the regulators' implementation of the Volcker Rule, which makes it impermissible for banks to retain or invest in these assets.

According to the U.S. Chamber of Commerce, H.R. 4167 would ``preserve

this important source of financing that supports growth and job creation throughout our economy.'' CLOs have a proven track record of success, and they ``performed very well before, during and since the financial crisis.''

According to the Kentucky Bankers Association, investment in CLOs is a ``conservative addition to an existing and balanced investment approach'' and a ``thoughtful solution to the equity problem'' that banks face. In fact, the default rate on CLOs in the last 20 years has been less than one-half of 1 percent.

Yet, despite this proven track record and despite this critical source of funding for growing U.S. companies and job producers in America, the Volcker Rule regulators require that banks divest of their CLO holdings. The consequences will be a fire sale in the market that will cause significant losses to banks currently holding what are known as legacy CLOs.

Looking forward, it will increase the cost of borrowing in the future for U.S. businesses looking to expand, grow, and create much-needed jobs.

These warnings may sound abstract. So let me explain how this affects a real business that employs many of my constituents in Kentucky's Sixth Congressional District. Tempur-Pedic is a high-end mattress bedding company, and they produce, through space-age technology, very comfortable, high-end beds for the top of the market. But they knew that in order to be resilient and to be growing in the future, they needed to acquire a competitor that covered the rest of the marketplace--the value products, the midlevel products, and a lower but higher level form of mattress so that in the event of an economic downturn or competitive pressures in the marketplace, they would have a cross-section of the entire marketplace with all price points of bedding.

So Tempur-Pedic used CLO financing, where it didn't have access to affordable corporate bond financing, as affordable corporate bond financing. They accessed CLO financing and closed this transaction where they acquired a well-known company to a lot of Americans, Sealy, and that transaction closed in March of 2013. This allowed them to expand their business and create already in just a year's time 200 new jobs in my district.

Thanks to CLO financing, Tempur Sealy is now a more resilient company and better poised for growth in the future. And if Tempur Sealy sees an opportunity to grow even more and is in need of a commercial loan, we want to make sure that this source of affordable financing is there for them and for all U.S. companies.

H.R. 4167 is a defined, narrow fix which clarifies that the Volcker Rule should not be construed to require the divestiture of any debt securities of CLOs prior to July 21, 2017, if such CLOs were issued before January 21, 2014.

H.R. 4167 also clarifies that a bank shall not be considered to have an ownership interest in a CLO for purposes of enforcement of the Volcker Rule if such debt security has no indicia of ownership other than the right to participate in removal for cause or in the selection of a replacement investment manager or investment adviser of the CLO.

So, in sum, Mr. Speaker, this legislation is a bipartisan, commonsense fix to a real world problem voiced by community banks and emerging growth companies like Tempur Sealy in my own district that will benefit these companies all around the country. So I urge a vote in support of H.R. 4167, the Restoring Proven Financing for American Employers Act.

Mr. Speaker, I thank the gentleman from New Jersey, and I thank the gentleman from Massachusetts for his contribution to the debate. It gives us an opportunity to actually analyze what exactly we are talking about here.

We are not talking about the risky assets that were contributing factors to the financial crisis. If this were junk, as the gentleman from Massachusetts describes it to be, the default rate on CLOs would have been much higher over the last 20 years. But the default rate on CLOs over the last 20 years, including during the financial crisis, was less than half of 1 percent. Not one of the nearly 4,000 notes rated AAA or AA ever defaulted in CLOs.

Part of the reason for this strong, durable performance of CLOs is because CLOs are very different from the troubled assets that fueled the financial crisis. CLOs are distinct because, number one, they are based on diverse assets, commercial loans that are well diversified across the industry. These are solid, diversified loans, and they are typically secured loans.

Secondly, there is an alignment of interest between CLO investors and the CLO managers. The managers actually have skin in the game.

Finally, third, there are significantly greater transparency features to CLOs and disclosure since the commercial loans here, the secured commercial loans, are issued by companies that report financial information on a regular basis to investors, and they are required to provide regular financial reports with the SEC.

Now, with respect to the gentleman's claim that the CLO market is doing just great, there is a lot of misinformation about this. According to the Loan Syndication and Trading Association, U.S. banks hold an estimated $70 billion of CLO notes, which would have to be divested if we don't make the fix by July 21, 2015, and with the Fed's change a little bit later. But even the threat of such a divestiture roiled the CLO market in December and January before Congress took action.

So due primarily to uncertainty around the Volcker Rule in January 2014, U.S. CLO issuance dropped nearly 90 percent from the prior year, drying up access to credit. The only reason why the CLO market has recovered since January is because of this bill. It is because of the legislative action, the bipartisan efforts of this body.

Finally, I just would like to conclude by responding to the gentleman's assertion that a little limitation is good for the system-- a little limitation is good for the system. Well, hear what a witness at our hearing about this issue said about this little limitation:

If you have a situation where the Volcker Rule basically

impedes U.S. banks and some foreign banks from investing in

CLOs, you can see their appetite reduced by 80 percent. They

will just not participate in the CLO market.

Ultimately, that leads to our other point, in that we can see a significant cost to financing for U.S. companies. What happens when you see a significant cost to financing or decreased credit availability for companies? That means these companies that have over 5 million employees can't build new factories, they can't build new cellular networks, they can't expand, and they can't combine and merge to bigger, more resilient companies that can compete effectively on a global basis. It ultimately would have a very destructive effect on U.S. companies.

So, Mr. Speaker, in sum, I will just bring it back to my home district. If a little limitation is good for the system, tell that to the 200 Kentuckians who now have jobs because of this innovative source and a responsible source of commercial credit in America.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 4167) to amend section 13 of the Bank Holding Company Act of 1956, known as the Volcker Rule, to exclude certain debt securities of collateralized loan obligations from the prohibition against acquiring or retaining an ownership interest in a hedge fund or private equity fund, as amended.

I ask unanimous consent that all Members have 5 legislative days within which to revise and extend their remarks and submit extraneous materials to the Record on H.R. 4167, as amended, currently under consideration.

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

Mr. Speaker, I rise today in support of H.R. 4167, which is the Restoring Proven Financing for American Employers Act. It was introduced by the gentleman from Kentucky (Mr. Barr), who we will be hearing from shortly. And I would also like to thank my good friend from New York (Mrs. Maloney), the ranking member of the Capital Markets Subcommittee, for her bipartisan and commonsense work on this important issue as well.

Today we have the opportunity to correct, in a strong, bipartisan way, an egregious example of regulatory overreach. For no reason that has been coherently stated by anyone, the banking regulators responsible for implementing the Volcker Rule have included provisions in their final rule that will literally cripple the market for collateralized loan obligations, also called CLOs.

See, at the stroke of a pen, the banking regulators are going to wreak havoc on one of the largest and most important sources of financing for literally hundreds of growing companies across this country. If the CLO provisions in the Volcker Rule go forward as planned, there will be a heavy price to pay in failed companies and also lost jobs.

So why is the government doing this? Did CLOs do anything to cause the financial crisis? No, they did not. Are CLOs a menace to the stability of our financial system? No, again. Is the small proportion of securities included in some CLO structures a national crisis that requires such a heavy hand by the Federal Government? Of course not.

Thankfully, the bill we have today, introduced by my friend from Kentucky (Mr. Barr), fixes this problem of the banking regulators' own making. First, it prevents a disastrous fire sale of suddenly impermissible legacy CLOs. Second, it narrows the Volcker rule's absurdly broad definition of an ``ownership interest'' in a CLO.

Last month, the Financial Services Committee passed this bill on an overwhelmingly bipartisan basis, with all but three members of the committee voting in favor of it. The Independent Community Bankers of America and the American Bankers Association have all voiced their support as well.

I am sorry, though, that it has come to this. You know, time and time again the committee has admonished the banking regulators that the CLO provisions of Volcker were a threat to the economy and to the financial stability that they are supposed to be protecting. Time and again, however, the unwieldy banking regulators chose to do nothing. If they had corrected this problem as we have been urging them to do and which they could do, we would not be here wasting valuable legislative time saving the CLO market from our own public servants.

Now, some have suggested that the agencies don't have the legal authority to fix the problems. It is interesting that Federal agencies always seem to have plenty of authority when it comes to doing something, but when they need to fix something that they messed up, well, suddenly they have no authority.

Perhaps the real problem is the fact that we have so many different banking regulatory agencies in the first place. If coordinating these agencies to avoid a regulatory train wreck is too difficult, then maybe we need fewer agencies.

I have spoken before about the proliferation of government regulators with authority over our financial markets. More regulators mean more wasteful duplication of functions, more regulatory confusion, more empire building, more bureaucratic rivalry, less accountability, and less problem solving.

An ever increasing number of agencies with ever increasing authority only makes our financial system more unsustainable and more arbitrary and more unstable, and it makes it all the more likely that the heavy- handed government will fall suddenly on some unlucky corner of the economy.

So it is my hope that this body can come together now and support this bipartisan piece of legislation so that we can ensure that the market for collateralized loan obligations, CLOs, is not carelessly and needlessly destroyed. While they may not have a high profile, CLOs provide a valuable function that our recovering economy cannot do without, and I urge my colleagues for that reason to support H.R. 4167.

And at this time, I will reserve the balance of my time.

Mr. Speaker, at this time, we are now joined by the sponsor of the bill, the gentleman from Kentucky, who, as was indicated, worked in a bipartisan manner to get it out of committee, here on the floor. And I assume we are going to see a strong bipartisan vote for it on the floor as well.

At this time, I yield such time as he may consume to the gentleman from Kentucky (Mr. Barr).

I reserve the balance of my time.

Mr. Speaker, how much time do we have remaining?

I yield 4 minutes to the gentleman from Kentucky (Mr. Barr).

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

I just want to take a moment to respond as well to the gentleman from Massachusetts. He indicated that he is probably not going to convince anyone who is supporting the bill. I presume I am probably not going to convince him either, as I look over there, because he is now off the floor; but if he is back in his office and tuning us in, let me just make some points where he might be convinced.

He spoke about the fire sale that will not occur now under the proposed Volcker Rule. Well, yes, it still will occur, just because you are not saying that the sale has to occur this afternoon, but it is going to occur at a set point in time, either 6 months from now, a year from now, or as they are proposing, 2 years from now. In either case, when you set a date certain for a sale, then everyone else out there knows that this is the day that they might as well wait for; and eventually, they will have to sell, and at that point in time, they will engage in a fire sale.

In other words, by setting a date when you have to sell all of your assets or whatever you have, you are basically pushing the price down in that market.

Secondly, with regard to sales up, I guess the gentleman from Kentucky already raised that point. Sales were going down until Congress came together in a unique experience for Congress, which was a bipartisan effort, and once the rest of Main Street and Wall Street saw that Congress can actually do things together and work together in a bipartisan manner, they did what the rest of Americans will do and said: good thing. They said: let's get that market going back up again.

As the gentleman from Kentucky pointed out, that is exactly what occurred.

Thirdly, the gentleman from Massachusetts admitted that the CLO market was not the cause or any cause of the crisis that we had back in 2008, and I have not heard any testimony from anyone on any panel from either end of the spectrum that the CLOs would be a basis for the next crisis that inevitably will come.

Next, the gentleman from Massachusetts raised the point that something like 70 percent of all the CLOs out there are captured by something like three large banks or three financial institutions and made it sound as though the smaller and midsized banks are not really playing here.

Then you had to listen to the next thing that he said. He said that most of those CLOs held by those would already be protected by the current Volcker proposal out of the administration.

Well, that tells you right there that the legislation from the gentleman from Kentucky is not addressing or not trying to solve a problem for the three large banks. The legislation he is trying to put forward in a bipartisan manner is, in fact, doing just as he explained for the smaller banks, for the midsized banks, those are the ones that we are concerned about; and we want to make sure that they are not hurt through fire sales or further restrictions on them.

Finally, last--but maybe not least--is the fact that this bill will not end too big to fail. Well, we know that Dodd-Frank, unfortunately, did not end too big to fail.

Dodd-Frank did a number of things, but it did not end too big to fail, and the way to solve that is not by nitpicking around the edges on areas such as this that did not cause the crisis in the first place.

In fact, the authors and the proponents of Dodd-Frank understood that when they passed Dodd-Frank--because, look, what is the language in

Dodd-Frank when it comes to the Volcker Rule and the CLO matter that is before us today? Did they want to have this included in the rule that Volcker would eventually come out with? The answer is no.

The language specifically in 619 of Dodd-Frank--voted in favor of, by the way, by the gentleman from Massachusetts--says:

Nothing in this section shall be construed to limit or

restrict the ability of a banking entity or nonbank financial

company supervised by the Federal Reserve Board to sell or

secure type loans in a manner otherwise permitted by law.

What does that sentence mean? That means that the sponsors of--and those like the gentleman from Massachusetts who supported Dodd-Frank-- specifically put into the Dodd-Frank law the direction to the Fed and the other regulators that they should not be doing what they are doing right now. They should not be putting, as it says, limitations on this type of instrument.

So for all of those reasons, if the gentleman from Massachusetts is still watching what we are doing on the floor, perhaps we have convinced him that he should join with the majority on both sides of the House and not be part of the three or so who remain opposed to this and support the legislation, H.R. 4167.

With that, I yield back the balance of my time.

Well, I thank the gentleman from Michigan for his leadership on title III of this package and the Mortgage Choice Act, and I appreciate the gentleman's yielding so that we can talk about why every Member of Congress should support this package of reforms.

Before I get to the substance, I do also want to thank the ranking member, thank her for voicing support for the underlying policies in this legislation. I want to thank her for expressing absolutely no concern about the substance of the policy in her remarks, and I would also like to thank the ranking member for her recognition that the Dodd-Frank law may very well have flaws, even for those who adamantly supported the passage of the bill, and for her acknowledgement that she would have no problem changing or dealing with some of the flaws of the Dodd-Frank law. Well, this is our chance, Mr. Speaker. This is the chance to deal with those flaws.

The legislation on the floor tonight is a package of four commonsense financial services bills that all share a common theme. They all have proven bipartisan support. They all have passed either the House or the Senate with unanimous or near-unanimous support, and, most importantly--put aside all of this procedure here--they all promote jobs.

They all promote durable economic growth in this country, and Members on both sides of the aisle and Members in both this Chamber and in the Senate agree about that. Let's stop the games in Washington, and let's get the American people back to work. That is what we have an opportunity to do here in a bipartisan way; so I call on my colleagues to support this bill.

This is a simple 14-page bill that is about fixing unintended consequences of the Dodd-Frank law. These fixes are technical corrections, and they are meant to clarify provisions in the law where, although congressional intent was clear, the authority provided by the statutory language led some regulators to enact or promulgate economically destructive regulations.

The four titles of this legislative package represent the hard work of a number of Members of Congress on both sides of the aisle. Let me just go through those really quickly. Title I of the legislation is an important provision that clarifies the capital requirements applied to insurance companies subject to Federal Reserve Board supervision.

Mr. Huizenga did a good job explaining what this title does; but, just in summary, it is important that the capital rules for insurance companies are carefully tailored to the business of insurance rather than arbitrarily holding insurance companies to standards that are meant for banks.

I want to thank Congressman Gary Miller, a Republican from California, Congresswoman Maloney, a Democrat from New York, for their leadership--bipartisan leadership--for this Insurance Capital Standards Clarification Act and for helping push this provision forward.

I would also like to further emphasize the bipartisan and noncontroversial nature of this title by noting that the Senate version of the Insurance Capital Standards Clarification Act passed the Senate by unanimous consent on June 3.

Then there is title II. Title II is the text of a bill that I introduced in March which passed the House by a voice vote. This was a bill that no one opposed. This was a bill that simply incorporates bipartisan provisions of the Restoring Proven Financing for American Employers Act, and it is about jobs.

It is about restoring a robust and dependable commercial lending market to U.S. companies so that they can obtain affordable financing to expand their businesses.

Collateralized loan obligations, known as CLOs, have proven to be a critical source of funding for U.S. businesses for over 20 years. Today's CLOs continue to provide $300 billion in financing to U.S. companies on Main Street, including companies that are well-known to all of us in this room: Dunkin' Donuts, American Airlines, Burger King, Toys R Us, Delta Airlines, Goodyear Tire, and even a mattress company in Lexington, Kentucky, my home district, Tempur Sealy.

Because of this innovative source of financing, U.S. employers have expanded, jobs have been created, and our economy has grown; and, despite a proven track record with a default rate below even a half a percent, this valuable form of corporate finance is under assault because of the Volcker rule.

Further relief from the Volcker rule for these CLOs is necessary to prevent a fire sale in the CLO market that will cause significant losses for banks of all size. This defined, narrow fix which clarifies that the Volcker rule should not be construed to require the divestiture of any debt securities of CLOs prior to July 21, 2017, if such CLOs were issued before January 31, 2014, is a commonsense solution.

It clarifies that a bank shall not be considered to have an ownership interest in a CLO if such debt security has no indicia of ownership other than the right to participate in the removal for cause in the selection of a replacement investment manager or investment adviser of the CLO.

This title is a bipartisan commonsense fix to a real-world problem voiced by community banks and by companies on Main Street that want access to this affordable and reliable source of commercial credit. It prevents an unnecessary fire sale in the CLO market that would cause significant losses to banks currently holding these legacy CLOs, and it will help keep the cost of borrowing affordable in the future for Main Street U.S. businesses looking to expand, grow, and create much-needed jobs.

I want to personally thank Congresswoman Maloney and Ranking Member Waters for working with me to enact a CLO fix so that it could pass by a voice vote in April.

Then, also, title III, this is the fix that Congressman Huizenga helped pass, and Congressman Huizenga worked in a bipartisan way with Congressman Meeks to support this Mortgage Choice Act, and it passed the House by a voice vote--not a single objection--on June 19, and I won't go over the details which Congressman Huizenga has done well, but I will say that this measure will greatly advance our efforts to help the housing market and our economy recover as Members on both sides of the aisle have demonstrated with their support and supporting it by voice vote.

Finally, title IV, this is the fourth and final title of this package, and it is a provision that has broad support for Main Street and businesses of all sizes. Like other provisions of this package, title IV is meant to alleviate the unintended consequences created by Dodd-Frank. It is a technical fix that has proven bipartisan support and passed the House on June 12 with 411 votes in favor.

The provision simply clarifies and codifies congressional intent that Dodd-Frank was not supposed to impose margin requirements on end user derivative transactions. We are talking about nonfinancial companies that produce goods for the American people and simply use derivatives to hedge against commercial risk.

This provision is not about speculation. It is about promoting responsible risk-management practices among U.S. companies. In fact, failure to enact this provision could lead to more risk as companies may be deterred from engaging in hedging transactions.

It requires them to needlessly tie up capital that could otherwise be used to do more productive things like expand operating plants, perform research and product development, and ultimately create jobs. Again, this is a provision that previously passed the House with near unanimous support.

In conclusion, Mr. Speaker, what do we have here today? We have a package of four bills, 14 pages, unlike the 2,300 pages in Dodd-Frank-- 14 pages, each of which of these four bills--overwhelmingly bipartisan--each of which are vital to preserving and creating jobs, each of which are noncontroversial in nature, and two of these provisions previously passed the House by voice vote, a third passed with 411 votes, and the fourth is a commonsense critically important solution for the 75 million American families that rely on life insurance for financial and retirement security, a bill that passed the Senate by unanimous consent.

The substance and the policy behind these bills are bipartisan. It is solid. I would certainly expect that, if you would support the underlying policy, then you would support this commonsense package of bills to promote jobs and durable economic growth.

Mr. Speaker, I thank the gentleman, and I thank the gentlewoman for her comments. I appreciate what she is saying about bipartisanship. Let me just make sure I clarify. I was referring to Congresswoman Maloney on the legislation that she and I worked on together, the CLO bill. So, in a very bipartisan way, I worked with her on that.

But to the substance of the gentlewoman's remarks, I appreciate what she is saying, absolutely, and that is what is such a shame about this whole situation because we have four bills that have been worked on in a bipartisan way. There shouldn't be any controversy about this whatsoever.

Let's do the business of the American people, get them back to work. Pass these bipartisan bills.

Just for the record, when my colleague was speaking, my name is Carolyn McCarthy, not Carolyn Maloney, just so we clarify that, and I want to thank Ms. Waters. I want to thank the ranking member on Financial Services.

I have a speech here, but I need to clarify a few things. I am not sure, my memory has not been good since I was sick, but I was on Financial Services when we did Dodd-Frank, and we worked very hard, bipartisanly, on that committee, and we saw the problems on some of the language, and we corrected them bipartisanly.

We made sure that when we were dealing with derivatives, that it didn't have the language that you are complaining about. That came from the Senate side.

When we are talking about the insurance companies and making it easier to make sure they could do their job and not be treated like a bank, we got the language here on the House side. Again, the Senate side misinterprets some and had the wrong language. Gary Miller and I have been working a year--over a year--to make the corrections that are coming out today.

Now, I support everything that we are going to be voting on, but I am reluctant about it because talking to my colleagues on the Senate side, they have said that they will not do it; so something that you all want has a really good chance of never seeing the light of day. Maybe next year. That is fine. Whom are you hurting, and what are you proving? Mainly because, now, the insurance companies are going to be in limbo. We don't know what is going to happen; so you are putting off something again.

I am ending my career here in Congress. I will be retiring, and I have to say, for 18 years, I have worked bipartisanly, and I have gotten a lot of things done, and I hope to continue to get some things done between now and when I retire, but I also think what I have seen here is this politicking that words are said and people don't get to know each other.

Now, the audience might not understand everything that is going on here on the floor, but I do believe that what we have done on Dodd- Frank--and, now, yes, there are technical changes; but, to be very honest with you, in 18 years, I do not remember any bill--major bill-- being passed here, going through the Senate, that didn't come back for technical changes.

We are not perfect. As many times as people want to think we are, we are not. We are human beings; and, unfortunately, we do not take the time to legislate and to work things out as we have done in the past. I am not blaming Republicans, and I am not blaming Democrats.

We have got good people on both sides of the aisle, and it hurts me terribly to see this going on when everybody should be working together for the country, not whether you are a Republican or a Democrat.

There are many of us who care very much about getting jobs. There are many of us that care to get everybody forward, and I think that is something that people have to start realizing. We have so many members on your side of the aisle and members on our side of the aisle that have been friends for

years and years, and you have got to learn to work together. You can have your opinions, and we have ours, but you have got to sit down and work together.

I know the big word around here is don't compromise. It is not compromising. It is trying to represent all of our constituents for the whole country.

And Ms. Waters is absolutely right. She worked very hard during Dodd- Frank, as many of your Republican colleagues did. But it was Gary Miller and I who have been working with the Senate for over a year and to see this bill come onto the floor, which is going to pass, and it will pass. What upsets me is it is not going to go anywhere in the Senate. Another bill will die. And there is no reason for it. 204 Members bipartisanly want to see the Capital Standards Clarification Act of 2014 passed.

I understand where you want to put everything together so you see it is efficient. Sometimes you have to know how the Senate works so that we can be efficient and work with them as we go forward because, if had you done that, you would hear Republicans and Democrats in the Senate and their aides who are saying, This is not the way it is done. That is why we are upset.

When you have so many people working on this, many of your colleagues, my colleagues signing on to having it done, and now we are going to see, most likely, it die or put off until next year, which is really a shame because the companies you are talking about, everything you are talking about as far as the jobs bills and everything else like that, I would like to see that signed by the President tomorrow. That ain't going to happen now, and it is not going to happen now.

So what I will say is Ms. Waters is correct, but I will vote for this bill tomorrow. Many of my colleagues will vote for this bill tomorrow because we are hoping we will go forward. But in my heart of hearts, because I have been around here too long, I don't think the Senate is going to pass it, and that is a shame because that is what you are working for. That is what we are working for. But the Senate's procedures do not do it.

They will take a stand-alone bill. And from what I understand, Mr. Miller and I will hopefully introduce a stand-alone bill in the next few days, because if this dies in the Senate, we will take up the Senate bill, which is our bill, and hopefully get a vote here and have the President sign it within a few days.

Mr. Speaker, tonight the House is considering the Insurance Capital Standards Clarification Act of 2014 under suspension of the rules.

This bill contains four Financial Services Bills including S. 2270.

I am pleased to be the lead democrat on H.R. 4510, the House companion to S. 2270, the Insurance Capital Standards Clarification Act of 2014. However, this is not the same bill that we will be voting on.

Though I will reluctantly support the bill, I am disappointed in the process and believe that S. 2270 should have been brought up as a stand-alone bill, rather than combined with three other bills which have already passed the House. The Senate has indicated they would need to start all over if changes were made to the original bill.

Ranking Member Waters rightly objected to this procedure last week yet her concerns were ignored.

S. 2270 supports a more precise application of capital standards that furthers the interests of strong prudential supervision. This legislation grants the Federal Reserve the appropriate flexibility to apply accurate capital standards for insurers. This bill will help keep insurance products affordable and available by ensuring the correct capital standards are applied to insurance companies that fall under the supervision of the Federal Reserve.

This House version already has 204 bipartisan cosponsors and S. 2270 would easily pass under suspension. This bill has already passed the Senate by unanimous consent. Passing S. 2270 on its own in the House would have sent the bill directly to the president's desk.

Instead, the Financial Services committee majority leadership has insisted on combining four bills and using our title, even though this is different legislation. This creates uncertainty as to the future of the original bill.

I will support the Insurance Capital Standards Clarification Act of 2014 on the floor tonight and urge my colleagues to do the same. However, I am disappointed in the process that has been used. Had S. 2270 been passed as a stand-alone bill, it would have been sent directly to the President's desk. Instead, we will likely have to vote on S. 2270 as a stand-alone bill during the lame duck session, which is already filled with a long list of remaining actions.

The House delay in passing this bill is causing uncertainty for insurance companies who cannot plan for the future of their businesses without knowing the appropriate capital standards. I encourage my colleagues to cosponsor H.R. 4510, the House version of S. 2270, so that we can reach 218 cosponsors and bring this to the floor.

What I was trying to explain to you, it is not that we are giving up our power from here to the Senate. The Senate will not accept everything as a package because they have to change all their language, and that is not going to happen.

They will send back here a stand-alone bill, probably pass the other package--that is fine--but they are not going to change or open it up. That is what I meant to tell you, that you have to understand how the Senate works, and the House is totally different. That is all I am saying, and that is why this bill might die, unfortunately, over in the Senate, because they are not going to get to it because, let's face it, we have too much to do between now and when we come back for a lameduck session.