Floor Statements

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I ask unanimous consent to speak in morning business for such time as I may consume.

Mr. President, this morning's newspapers, once again, chronicle the difficulty that exists in this country. There is obviously a financial crisis, a collapse of the banking system, particularly on Wall Street.

Just to name two, today's paper says there is a place in the budget that is a holding pattern for a potential $750 billion of additional funding that might be necessary for the big bank bailouts in this country. We also know from the newspapers and from news this morning that Citigroup has reached some sort of a deal with the Federal Government in order to make Citigroup viable. So each day we see more and more discussion about these kinds of issues. It begs the question about who is doing what? What do we know about all of this? How open is this? How much

should the American people know about how their money is used?

I have come to the Senate floor today to talk about just one part of it. At a time when there is so much discussion here about hundreds of millions of dollars, billions of dollars, tens of billions, hundreds of billions of dollars, and now trillions of dollars, I wish to trace just $3.6 billion. That is a lot of money: $3.6 billion that the American taxpayers paid in bonuses to some big shot executives that steered their institution into the ground. Let me tell my colleagues about the story.

This is a story about Bank of America buying Merrill Lynch. Our previous Secretary of the Treasury was concerned about Merrill Lynch having serious problems. He let Lehman go bankrupt, believed that was a mistake, and so Merrill Lynch is adrift and we have to find a marriage for Merrill Lynch. Apparently, the Treasury Department worked to get Bank of America to agree to buy Merrill Lynch. By the way, Bank of America had already purchased Countrywide Mortgage, which was a complete mess and a collapse and one of the big mortgage companies that, in my judgment, has caused much of this problem. Bank of America already had purchased Countrywide and the assets of Countrywide Mortgage. Now it was being encouraged to purchase Merrill Lynch. So that marriage was arranged by the Treasury Secretary and others, and that marriage was announced, by the way, last September and consummated in early January of this year.

Now what we discover is that Bank of America got substantial amounts of taxpayers' money in TARP funds and other guarantees. So Bank of America has taxpayers' money, and $10 billion of the taxpayers' money that went to Bank of America would have been destined for Merrill Lynch had Bank of America not purchased it. Merrill Lynch, it turns out, when they were taken over, had just suffered a loss of some $15 billion in the fourth quarter of 2008. That caused problems for Bank of America which had agreed to purchase Merrill Lynch because Bank of America, before buying Countrywide and Merrill Lynch, was a healthy company, and now all of a sudden it is not a healthy company and needs substantial funds from the American taxpayers. But now we find that Merrill Lynch paid bonuses to its employees in December of last year just before the takeover by Bank of America was completed.

Now, as I indicated, Merrill Lynch lost $15 billion late last year, and they paid $3.6 billion in bonuses in December. Let me describe the magnitude of these bonuses. Six hundred ninety-four employees at Merrill Lynch, according to reports, received bonuses in excess of $1 million. Let me say that again. Nearly 700 employees in that failed company--a company that lost $15 billion in the fourth quarter of 2008 received bonuses of over $1 million. It is unbelievable. Four top executives in that bank received $121 million. The top 14 employees in that institution got $250 million. Think of that: $3.6 billion paid in bonuses in December to people at an institution that lost $25 billion in the year. That $3.6 billion could have just as well been transported through a pipeline from the pockets of the American taxpayers to these 700 people who got over $1 million apiece because that is taxpayers' money. That money from TARP funds--$25 billion and further money which guaranteed bad assets--that comes from the American taxpayers.

Had they not paid the $3.6 billion in bonuses to these folks, their loss in the fourth quarter of 2008 would not have been $15 billion, it would have been $11.4 billion. Taxpayers would not have had to come up with that kind of funding through the TARP program. So I know where $3.6 billion went; American taxpayers were asked to pay that $3.6 billion in bonuses to the 700 people who got $1 million apiece from a failed institution. Now Bank of America has this issue because Bank of America purchased Merrill Lynch. Bank of America now has serious financial trouble, and they have received even more funds as well. One of the questions about this is, How do we know the details about these bonuses? It is because an attorney general in the State government in New York had the guts and the intelligence to subpoena this information and demand that it be turned over to him. Question: Why is it that some committee in the Congress doesn't have this information? Why is no subpoena coming from the Congress on these issues? Why is there no systematic, significant investigation here? After all, this Congress is the institution that has triggered the funding. Yet these investigations are occurring with an attorney general in State government.

This Congress needs to do a lot more. There needs to be investigations and accountability. I have offered those amendments. We ought to get to the bottom of who did what, who got the money, and who left town with the cash from the American taxpayers. This morning's news about Citigroup being rescued--do you know what? We are told Citigroup is too big to fail. How did it become too big? The Federal Reserve Board, Alan Greenspan, Treasury folks, and both Republican and Democratic Members pushed legislation that allowed them to create big holding companies and become too big to fail. I understand you need banks, and I understand you need big banks. But the big banks don't have to be so big that they are too big to fail, so when they make reckless decisions, the American taxpayers are told: We are too big to fail and you must bail us out. There is no inherent right for the biggest financial institutions in this country to continue to exist. I understand the circulatory system in this country and that a necessary part of it is the banking institutions. I understand how critical that is.

My point is not that we can do without banking institutions. My point is that there is no inherent right to exist for those banks that have their current names and are declared too big to fail. What about putting them through some sort of a ``bank carwash'' and getting rid of all that tar--those bad assets--and sell the good assets to an institution that is reconstituted as a new bank? What inherent right is there for banks that have run this country into the ditch and destroyed their financial capability--what inherent right do they have for them to continue to exist?

I am not suggesting we shut down the banking system. But perhaps this lesson ought to suggest to us that ``too big to fail'' is a doctrine that is a failure, because if you have decided you are going to allow institutions to become too big to fail, you have sent yourself down a road that is a dead end, in my judgment.

The culture, it seems to me, that is on Wall Street, and the culture in this town--precisely in Treasury and some in Congress--is a culture that suggests that what was is what has to be in the future. That is not the case at all. I have talked ad nauseam about 1999 on the floor of this Senate, when both Republicans and Democrats steered a different course and said let's get rid of those old protections we put in place after the Great Depression--Glass-Steagall and those things, those old- fashioned notions--and let's dump them and create the Nation of one- stop shopping for securities and virtually everything you want to do in securities, real estate, and finance. So the Congress did dump all those old-fashioned rules and laws that were put into place after the Great Depression. I was one of eight Senators who stood on the floor and said no--one of eight who voted no. I said then on the floor of the Senate that I think within a decade we are going to see massive taxpayer bailouts. It was a disastrous decision to have done it. Now we must reconnect it. There is no discussion here, and there needs to be about what do you reconnect? Do you go back to some semblance of whether it is Glass-Steagall, or some approach to Glass-Steagall, in which you begin to separate the essential functions of banking from other areas of substantial risk? If you don't do that, what do you do to provide protections that this would not happen again?

There is a culture here that suggests you cannot do that, it is impossible. There is a culture here that suggests we have to keep bailing out whatever it is. We have pumped $700 billion out of this Chamber into something called a TARP fund to be used for the big banks. Now we are told there needs to be a marker to protect the potential of another $750 billion. That is nearly $1.5 trillion pumped into the top of our banking institutions, like putting oil

in a crank case--and these are failed institutions. Yet the only investigation I see happening is coming out of an office in the attorney general's office in Albany, NY. It is unbelievable to me.

Does anybody here understand that $3.6 billion was put in a hose directly from the taxpayers' pockets to bonuses for 700 people in a failed banking institution, so each of those 700 people got $1 million or more, and the 4 top people, by the way, got $120 million. By the way, let me point out that one of those top four people in Merrill Lynch, according to a news article in New York, got $24.9 million and was just hired in September of last year. So he got almost $25 million for 3 months of work. Then he quit. The day he quit, according to the news record, his wife closed on a $36 million luxury co-op on Park Avenue. Pretty unbelievable. By the way, another top executive, Thomas Montage, who headed global sales and trading at Merrill Lynch, was reportedly given a guaranteed payment of $39.4 million for 2008. Does this sound like fiction? It does to me.

This week, we were treated to a rant on television by a guy I saw standing on a trading floor, a derivatives trader, who was ranting about losers and about reckless behavior, about the losers who might get help to stay in their homes. We have had millions of people lose their jobs, some 2.6 million people last year. A good number of them are also losing their homes. Somebody says maybe you can try to find a way to help some of them stay in their homes, and that derivatives trader stood and ranted about the losers who have lost jobs and are about to lose their homes. I wonder if that derivatives trader might stand on the floor of an exchange and describe losers as people who make $24.9 million for 3 months of work in a failed institution. Are they losers? How about the nearly 700 people who got over $1 million each in bonuses from the American taxpayer? Are they losers? Or is it just the little folks, the casualties at the bottom of this economic wreckage, the people who lost their jobs, their homes, and who are losing hope? Then they see these stories about ``too big to fail.'' When 700 people get bonuses of $1 million each in an institution that lost $15 billion in just one quarter last year and the institution pays $3.6 billion in bonuses, I wonder if the folks who are having an itch to rant today might want to rant about that kind of nonsense.

How about laying off the folks who don't have it so good, the folks who are struggling and trying to get by, hoping beyond hope that maybe they are not going to get laid off; or if they just got laid off, hoping beyond hope they might be able to find another job; or hoping beyond hope that if they got laid off and haven't yet found a job, they can find some way to scrape up enough money to make the next house payment so they will not be kicked out of their house. These people are losers, you say? I mean, of all the unbelievable things I have heard, for a derivatives trader to stand on the exchange floor and rant about the losers at the bottom of the economic scale, shame on him, in my judgment. I will tell you where the losers are. The losers are the folks who have wallowed in big bucks, getting bonuses from institutions that have failed and then asking for taxpayer money and then asking us to pry those bonus numbers out of the bowels of their financial records. They didn't give them up exactly voluntarily. It was an attorney general of New York who forced that information into the open. Well, where is the outrage about these things? Where is the outrage? Let me hear a rant from somebody standing on a trading floor about that--just one.

This Congress has a lot of work to do. This Congress has not begun to do the investigations that are necessary. We should not learn these things from an attorney general in New York who is issuing subpoenas. We should learn them by substantial investigations here to find out what happened, who got the money, and what happened to the first $700 billion.

I have used the term ``bank robbery,'' and I understand it is a pejorative term. When we think of bank robbers, we think of Jesse James in Northfield, MN, with a mask over his face and a gun and a fast horse. Well, a whole lot of folks have robbed big banks in this country of their financial viability and of their strength, through horrible, bad decisions--even as they have taken massive amounts of money from the banks for themselves. That is bank robbery. I know it is a different kind--with no violence and they are wearing suits and flying in private jets--but it is robbing America's financial institutions. As I have described, I think it also robs American taxpayers.

I want this country to do well. I want this financial wreckage to end. I want us to put America back on track. I want us to do the things that are necessary to prevent this from ever happening again. But you cannot do that unless you understand what happened. Accountability is looking backward and forward. I am talking about all this because when we have to discover by reading the newspaper that a State official has finally subpoenaed records to find out that a company that lost 25 billion last year gave out $3.6 billion in bonuses, probably from $10 billion of the American taxpayers' money, we have a right to know that. I have indicated on the floor of the Senate before that much of this is about economic recovery. If we are going to get by this and through this--and I think we will--it is about confidence. It is about restoring confidence in the American people about their future. When the American people are confident about their future, they do things that expand the economy. When they are not confident, they do things that contract the economy. It is as simple as that.

I ask, how can Americans be confident when, day after day, they read these stories about how folks at the top get off with a lot of money and then their friends call the folks at the bottom losers. That is hardly inspiring, in my judgment. We have a lot of things to do. First, is to investigate all this and, at the same time, to understand what has happened; we need to begin working to figure out what kind of a banking and financial future we want. We are going to try to put people back to work with the economic recovery package, building infrastructure, trying to put people back on the payroll. That will give confidence and also build an asset for our country. All those things are necessary.

The other steps that are necessary is for us to think, what did we do in 1999 to say let's allow big bank holding companies to be created and grow banks that are too big to fail, and let's decide we don't want to regulate anything. How are we going to put that back together? Should we not revisit that decision that turned out to be so wrong and the issue of Glass-Steagall or some form of it? Shouldn't we revisit exactly what we want in terms of future regulatory oversight?

Let me make one other point while I talk about this. I sat across the table from a North Dakota banker some while ago at what was called a sauerkraut festival. I said to him--this is a town of 1,200 people or so. I said to this community banker: Do you have money to lend?

He said: Oh, sure.

I said: If the biggest company in your town--which is a small manufacturing company--if that company needed some funding for an expansion, would you have money?

He said: Oh, sure, we have money. We have done banking the old- fashioned way. We take deposits and we make loans, but we do underwriting for those loans. We sit across the table from someone who wants a loan to be sure they are able to pay that loan. That is called underwriting. We bank the old-fashioned way.

Would it not have been nice if some of the biggest institutions banked the old-fashioned way?

I got a call the other day from a woman who runs a company that makes steel buildings. She has lost 80 percent of her business; 80 percent of her business is gone. Maybe they won't make it. But she asked the question: Is there any help for us? Is there any program out there that would help bail out our company because we were doing pretty well; this was a good economy for us; we were selling steel buildings, and it was not our fault this thing took a bad turn. Is there anything that can help us stay in business? We have people on our payroll. Is there anything that can help us because every day, she said, I read about the big banks getting all this money.

I assume she will probably read something I have said that not only do they get all that money in Merrill Lynch, they got $3.6 billion in bonuses

for the very executives who helped lose $25 billion last year.

The answer to that woman is, no, there is nobody here who has a program that says: You know what, let's pay as much attention to the Main Street business that is struggling this morning as is being paid to the biggest banks that are too big to fail. Nobody is talking about that small business.

By the way, when they lose, they lose everything. That small business, that dream, that risk of, in most cases, all the assets that family has, when that is gone, it is gone. Is there anybody here who has put together some structure that says: Let's help those folks. Maybe the economic engine also runs well when you help folks at the bottom. Maybe things percolate up in America.

I think it is a fair question to ask. It is a fair question to ask that many ask about rewarding reckless behavior, about what do you do in a country to try to put an economy that has been so savaged by bad decisions and, in some cases, bad luck, but also greed, a carnival of greed, what do you do to put it on track, to give people confidence about the future? There is not one solution. There is not one answer. There are a series of things to be done. It seems to me, first and foremost, we have to try to understand that the American people cannot continue to read this. They cannot continue to read that they are asked to come up with another $750 billion because these institutions are too big to fail but apparently not smart enough to understand you don't need to give $3.6 billion in bonuses to people who lost $25 billion. There is no Main Street in America where that decision would be made.

As I conclude, let me say that I want this country to succeed so badly. The President said it the other day. He had a room full of Republicans and Democrats in a joint session of Congress, and he said: I know everybody in this room loves their country. And we do. This country is in a lot of difficulty. It is not some natural disaster. This was not some Hurricane Katrina. This difficulty was caused by a lot of terrible decisions. Some people can call our offices and look at this Government and they can say: It was all Government policies. Let me just make this case as well that the consumer debt by the American people has gone up, up, up, straight up. That is not Government debt; that is consumer debt. That is also a problem. Giant trade deficits through unbelievably incompetent trade agreements, at $700 billion a year. We have a lot of problems, and we need to address them all right now and begin fixing them and putting this country on course so that we have an economy people can believe in and so they can believe life will be better for their kids than it was for them because this is a country that cares about expanding the middle class and lifting everybody up.

We can do this. We can do it. But we won't do it by ignoring the things about which I just talked. We ought to face them and face them now.

Mr. President, I yield the floor.

My vote on the DeMint amendment, No. 573, should not be construed as a vote in favor of restoring the fairness doctrine. I do not favor restoring the fairness doctrine.

However, the DeMint amendment went much further than legislating on the fairness doctrine. His amendment would have prohibited the FCC from establishing any program guidelines at all no matter how reasonable. For example, his amendment would have prohibited the FCC from establishing guidelines for children's programs or guidelines to prohibit violent programming during a family viewing hour in the evening. These are just two examples that the DeMint amendment would have prohibited.

To be clear, I support the provision in the DeMint amendment that would have precluded the restoration of the fairness doctrine. My view is that the fairness doctrine is not appropriate for today's market. I do support the creation of reasonable public interest standards that attach to a broadcast license dealing with localism issues and community responsibility. But, I could not vote for such a broad amendment that would have stripped from FCC reasonable and appropriate regulation of the type described above.

Amendment No. 591

Madam President, I ask unanimous consent that the Senate recess until 8:30 p.m., and that at 8:40 p.m., the Senate proceed as a body to the Hall of the House of Representatives to receive a message from the President of the United States; that upon disposition of the joint session, the Senate adjourn until 9:30 Wednesday, February 25; that following the prayer and pledge, the Journal of proceedings be approved to date, the morning hour be deemed expired, the time for the two leaders be reserved for their use later in the day, and the Senate resume consideration of S. 106, the District of Columbia House Voting Rights Act.

Mr. President, I would like to announce that the Committee on Indian Affairs will meet on Thursday, February 26, 2009 at 10 a.m. in room 628 of the Dirksen Senate Office Building to conduct an oversight hearing on Youth Suicide in Indian Country.

Those wishing additional information may contact the Indian Affairs Committee at 202-224-2251.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I ask unanimous consent to speak in morning business for 20 minutes.

Mr. President, there has been a generous amount of discussion on the floor today about the economic recovery package that has been put together and about the dire conditions of our economy. If you listen, they have been described in so many different ways-- financial crisis, deep recession, economic trouble, a wreck, a dire condition--and I suspect almost anybody who has been experiencing trouble in the workplace as a result of this rather steep economic decline would understand all of those terms.

I have been listening to the debate on the floor of the Senate, and I had to come to see if we could add a little clarity to what has caused all this. It is pretty hard to describe a remedy unless you understand what has caused it.

I understand from a lot of discussion a bit ago that there are a lot of people who don't want to do anything or they want to do something much less or they are not sure. In any event, I was thinking of how many people in the Senate lined up to help the banks. The Treasury Secretary said we have to pass legislation to help the big Wall Street banks. He said we have to pass a 3-page bill in 3 days for $750 billion. Boy, there was a big-old traffic jam trying to get up here to the well to vote in favor of that legislation, helping out all the big banks with hundreds of billions of dollars. Now we are talking about helping someone else out, helping out folks who need jobs, and all of a sudden, there is a big problem. Mr. President, $700 billion to bail out big banks and steer this economy in the ditch--that is OK, big traffic jam to do that, but some money to help put people get back on payrolls, no, that is deficit spending, we are told.

I showed this chart the other day on the floor of the Senate. There were 35 jobs available in Miami for firefighters, and 1,000 people showed up on the sidewalk and lined up to apply.

For some, it may be easy to come to the floor of the Senate and talk about the 598,000 people who lost their jobs last month, the 1 million people who lost their jobs in the last 2 months, and the 3.6 million people who lost their jobs since this recession began. But name 1, name 10, name 1,000, name 1 million or look at their picture and see the faces of people who want to work but cannot because they were told their jobs no longer exist. Then ask whether this is important, and ask yourself: What are you going to do about it? What do you think the remedy is? What do you think the priority ought to be with respect to putting people, such as these people, back to work: giving them an opportunity with a job or lining up in the well of the Senate to say to the big banks: Here I come; here is $700 billion. Big difference, in my judgment.

The difficulties we face in this country today are not some natural disaster. This is not Hurricane Katrina that came raging through our country. This is not some disaster over which we had no control. This is an economy which is collapsing and has very serious trouble as a result of specific things that have been done that have been irresponsible.

How on Earth do you describe a solution unless you are willing to admit what has caused it? Let me go through some of it. It is not a question of pointing fingers, it is just a matter of deciding, let's be straight about where we are and how we got here. They will write in the history books about this era and this age. We studied the Gay Nineties. We studied the Roaring Twenties. Somebody will study this age, this age of excess, this carnival of greed in the history books in the future.

So how did we get here? Let me describe it by saying we got, in my judgment, several fundamentally flawed policy changes that happened over a long period of time.

Trade. First of all, you cannot suggest this problem we have does not lay right on the doorstep of those who have allowed this trade deficit in this country to rise to $700 billion to $800 billion a year, buying $2 billion more each day than we sell abroad and racking up a giant deficit for this country that we must repay to other countries. Most of the Members of this body have been perfectly willing to be brain dead on that subject for a long time. Trade doesn't matter, the deficits don't count. Don't worry about jobs going overseas, don't worry about unfair trade agreements, just ignore it and just keep chanting about free trade. That is one big mistake that has been made for a very long time and no more so than during the past 8 years of the past administration.

With a trade deficit of $700 billion to $800 billion a year, add to that budget deficits. I know what they say about the budget deficit in the newspaper. OMB puts out a number. I think the

last administration said it is some $450 billion. That is not true at all. It is not $450 billion. The question is how much did we have to borrow last year. That is the impact. It is between $700 billion and $800 billion, even more depending on whose counting. So with an economy of $14 trillion or so, a $700 billion to $800 billion trade deficit, a budget deficit of somewhere around $700 billion to $800 billion, that is 10-percent or so indebtedness in 1 single year.

But it is not just the fact we have this budget deficit that has been so out of whack ever since the last administration took office--and by the way, they inherited a budget surplus. We had a big debate on the floor of the Senate, and those now saying: Let's not do much to remedy this economy, were standing on the floor of the Senate saying: We want to get rid of the budget surplus; we want very big tax cuts for a very long time, most of which will go to the very wealthy. Some of us said: Let's be careful, let's be conservative. No. Katy, bar the door. They passed their legislation. We ran into very big budget deficits in a very big hurry.

Trade deficits, budget deficits--and by the way, a budget deficit that was, in part, constructed by deciding to fight a war and not paying for it. Can you imagine, fighting a war and saying we are going to charge every penny. We say to the American people: You go shopping. That is what President Bush said: Your job is to go shopping. We are going to fight this war. We are going to spend $10 billion, $12 billion a month, and we don't intend to pay a penny of it. Some of us who wanted to pay for part of it were told: We will veto the legislation if you try. He said: I will veto the legislation if you try.

Trade deficits and budget deficits have weighed this economy down in a very significant way. And the very folks who have come today to talk about spending and deficits are the ones who supported all along a fiscal policy that created the most significant budget deficits in the history of this country.

Those are not the only two things. They are significant--trade deficit, a budget deficit, reckless fiscal policy. They are significant, but something else happened, something very significant, and I talked about it frequently on the floor of the Senate. The same people who are so concerned about these issues now joined forces to say: You know what, we need to modernize America's banking system. It is way old-fashioned, way out of date. We put in place all kinds of things since the Great Depression to prevent banks from being modernized, and we need to have one-stop shopping. We need to let banks get involved in real estate investments again. We need banks to get involved in securities investments again. And so they passed--yes, the Congress did; incidentally, there was bipartisan support for it--a piece of legislation called the Financial Services Modernization Act. It got rid of old-fashioned things that were put in place after the Great Depression and helped create the big bank holding companies that could get involved in securities, real estate, and all kinds of risk ventures attached to banking which we had prevented for 80 years.

All of a sudden, we saw the pyramid created, the big holding companies, and it was Katy, bar the door. What we saw was the buildup of unbelievable leveraged debt in these institutions and a substantial amount of risk brought into America's banking system.

Almost immediately, that system allowed greed to permeate. Here is how it manifested itself in one significant part of the contributor to this economic malaise, and that is the housing bubble and the subprime loan scandal. I have spoken about it at great length--I am sure people are tired of hearing it--the subprime loan scandal. We know people who were cold-called by brokers to say: We know you are paying a 7-percent interest rate. We will give you a 2-percent interest rate, and by the way, you don't have to pay any principal; 2-percent interest rate and no principal, and you don't have to document your income to us. No-doc loan, no principal, 2-percent rate. They put people in subprime loans not telling or emphasizing that it is going to reset in 2 years to 10 percent or 11 percent and you can't prepay because there is a prepayment penalty for doing it.

They larded up a whole lot of securities because they wrapped these into securities with bad loans, bad mortgages, and then sold them upstream to mortgage banks, hedge funds, investment banks. They were all fat and happy, and that included the rating agencies that would take a look at that security and say: That is a good security; that is AAA. They were all in on the take. By ``the take,'' I mean infected with greed. So we had the housing bubble. We had all of these mortgages out there.

Consider this: A $14,000-a-year strawberry picker buying a $720,000 home placed by a broker who got a big bonus for placing the mortgage without any chance of that person being able to make payments. But that mortgage then becomes a mortgage wrapped into a security sold to a hedge fund, rated as a security as AAA, sold to an investment bank. Now all of a sudden you have brokers who are happy because they are making massive amounts of money; you have the mortgage banks, they love it, they are making lots of money; hedge funds, they are making so much money they can't count it.

By the way, the top hedge fund manager a year and a half ago earned $3.7 billion. By my calculation, that is $300 million a month, about $10 million a day.

Honey, how are you doing at work?

I am doing pretty well, $10 million a day. I make as much in 3 minutes as the average American worker does in a year.

They were all happy, all making massive amounts of money. The problem is, they built a pyramid. The scheme of this pyramid is not much different from Mr. Madoff, who apparently allegedly got away with a $50 billion Ponzi scheme. This scheme was not much different. All of a sudden, it began to collapse.

Huge trade debt, big federal debt, reckless fiscal policy, fighting a war and not paying for it, charging every penny, in fact, insisting on continuing tax cuts even during the war, and then this unbelievable banking scandal by removing the protections that existed since the Great Depression and saying to the big banks: You can create holding companies, you can attach risk, such as securities and other issues, and it will be just fine. You can do that. And so they did. All of it was built on leverage--trade debt, budget debt, leverage debt in the private sector, almost unparalleled in the history of this country. Then the tent pole began to come down. All of a sudden, we discover a very serious problem.

To describe how significant the money that was being paid was, there was a discussion in the last couple of days in the Congress about maybe doing what President Obama suggested; that is, to those big companies that got bailout funds, for the top 25 people in those companies, their compensation should be limited to half a million dollars a year. It is interesting, when they tried to do that, my understanding is there was a budget cost to that of something close to $10 billion. Why would there be a budget cost? Because they were all making so much money that the income tax they would pay as a result of that money was so significant that you had a $10 billion budget cost if you limited the income of the top people on Wall Street in these firms to $500,000 a year. That is almost unbelievable to me. But having done some work to study how much income exists in those areas, that is exactly true.

There was an investigative story in the Washington Post about the failure of one of the largest investment banks. They described the top trader in that organization, a person trading securities and the person who was in charge of risk management. It turns out they carpooled every day from Connecticut to New York. It wasn't very hard to have the top trader deal with his best friend risk manager and get things done pretty easily. The top trader, they said, was making $20 million to $30 million a year. So that company turns out to be loaded with toxic assets, as were most of the other institutions engaged in exactly the same business because they were making so much money.

Now we are told the taxpayers have to come to the rescue of these banking institutions. So $700 billion has been voted in what is called the Troubled Asset Relief Program, TARP. I did not support that legislation. I didn't think

the Treasury Secretary had the foggiest idea what he was doing, and I think history shows that to be the case.

But one of the questions I think needs to be asked at this moment, is: Is there a requirement that we bail out these specific banks? Is that some divine right of existing institutions, to come to the Government to say: We are in trouble, you need to help us. Well, what has happened is the Government has allowed them to become so big they are referred to as being too big to fail. That is an actual specific category at the Federal Reserve Board--too big to fail. Despite the fact that they are bailing them out, our Government--the Federal Reserve Board and the Treasury, which have said these institutions are too big to fail, and have in fact failed and need taxpayer money to bail them out--our Government is actually pursuing mergers to make them bigger. It is unbelievably ignorant, in my judgment, as a policy matter. But I think it is important for us to ask some basic questions here. Do we care about too big to fail; and should we, at some point, decide to take apart those institutions and create different entities, smaller institutions?

I understand we can't tomorrow decide there will not be any major banking institutions in this country. Our country can't function like that. Credit is critical to every business in this country. I know many profitable Main Street businesses that are having great difficulty finding credit from established credit sources they have had for decades. So I understand the urgency and the need for credit from banking institutions. My only observation is this: If we are pushing $700 billion after failed institutions in order to try to make them well, even as we are saying to them, we want you to become bigger, and when, in fact, they are already too big to fail, I am saying that doesn't add up to me. I think maybe we should have a discussion here in this Congress about whether there is some inherent right to preserve institutions, or whether those that are too big to fail should be perhaps taken apart and create institutions that will better serve this country's interest.

Now, some say there are only two choices in the future as we try to take a look at financial reform. And by the way, there is very little action on that at this point, and I believe it ought to go concurrent with all the discussion about trying to put people back to work and so on. But it seems to me the two choices are: You go back to a world in which you had Glass-Steagall and separation of banks from other inherently risky things, such as securities and real estate. And I believe we should do that. That means banks essentially become very much like a utility. That is the way it was. They were regulated, but generally performing traditional banking functions and making money. Then risky enterprises are over here, regulated in a different way but nonetheless able to engage in substantial amounts of risk with securities, real estate, and other items.

We have to make that choice, and the sooner the better. I think to ignore that is to suggest, as some are now doing, that what we are going to do is we are going to have taxpayer money chase current institutions that have failed, and perhaps even make them bigger when they are already too big to fail. That makes no sense to me at all.

And that brings me to this issue today of the economic recovery plan that has been negotiated. I don't think anyone comes willingly to this either starting line or finish line with this kind of a plan to say, I am pleased to be here. But I do think this: I see all of the energy of people who rush to try to help the big banks with $700 billion, and then see so much concern about trying to help people who are out of work, and I say: Wait a second; maybe we have our priorities wrong here. I believe that the economic engine in this country works best when people have something to work with, when American families have a job to go to, a job that pays well and allows them to take care of their family. I think that is a percolating-up kind of strategy with the economic engine, and I think it is perfectly appropriate and important. In fact, I think it is essential for us to worry about trying to put people back to work during a very deep recession.

No one can say that what happened last month doesn't matter. You can't say that 598,000 people coming home at night and telling their loved ones they lost their job doesn't matter to this place. If it mattered to this place that the biggest banks in the country were having some difficulty, and they had to get $700 billion, why doesn't it matter that we care a little bit about the people who lined up in Miami, FL, a thousand of them, trying to get a little shot at 35 firefighting jobs? This too ought to matter. It is not unfair, as some have suggested last week when I showed this chart, and said I was playing on sympathy. This isn't sympathy. This is reality. Isn't it important that we talk a little about reality and a little less about theory here in the Chamber of the Senate? The fact is these people got up, stood in line, because they need a job, and we ought to be able to do something about that, to try to put people back to work and give this economy a lift.

I think it is pretty clear that no one knows exactly what the medicine is or the menu is to try to make this economy well and healthy once again. But this legislation we are going to be considering contains a couple of things that I put in during this past week when it was considered. One is very simple: If we are going to put people back to work building roads and dams and bridges and so on and so forth, putting people on payrolls to do these projects that will invest in America's infrastructure, then let's try to buy American products while we do it so that we are putting people on factory floors to produce those products. I am talking about steel and iron and manufactured projects.

When I suggested that we buy American for the major purchases that we are going to make to put people back to work, I did that because I know when we buy those products we will put our people back to work in those factories. But you would have thought I was talking the most radical kind of talk in the world, by the reaction of some--you are going to upset the international balance of trade. That is absurd. We are already so out of balance in trade. We are $700 billion to $800 billion in red in trade. At any rate, my legislation is here. So as we try to put people back to work and invest in our infrastructure to create jobs, we should buy American. It is common sense.

The second amendment I put in this piece of legislation is different than anything that has been required with all the other money that has been shoved out the door by the Federal Reserve Board, by the Treasury Department, by the FDIC, and, yes, with TARP, supported by the Congress, and that is a provision that says: I want accountability. If you get money from this economic recovery package, you have to report to us on a quarterly basis that says: Here is who I am, here is the money I got, here is how I used it, and here is how many jobs I created. That kind of accountability, demanding that kind of reporting, is essential for my support for this bill. And that is in this piece of legislation because I put it there last week.

Now, one final point, if I might. I understand, as I have said many times, that in most ways the issue of trying to promote economic recovery in this country is not about some menu. It is not about a menu of tax cuts or more spending. It is not about a menu of M1B or anything of that sort in fiscal or monetary policy. It is about trying to give the American people some increased confidence about the future. That is critical in order to have an expansion of our economy. People have to feel confident about the future in order to act on that confidence--to buy a suit, buy a new washing machine, buy a car, buy a home, take a trip. It is the kind of things people do when they are working and they feel good about the future and their job is secure. They do things that expand the economy.

When people aren't confident, they do the exact opposite, and that causes a contraction of the economy. That is where we are today. People aren't confident about the future. I understand that. I mean, I think all of us know why. They have seen the most significant era of greed perhaps since the 1920s, and they do not like it. They have seen a collapse of the housing bubble, they have seen big investment bankers get rich, they have seen all these things--the scandals--and it is hard to be confident. They have seen the country fight a war without paying

for it. Some people have given their lives. So I understand that we have a lack of confidence. The question is not whether that exists; the question is what do we do about it? Do we decide to do something about it? And if so, what?

I have described often the response of Mark Twain when asked if he would engage in a debate at this organization, and he said: Oh yes, if I can take the negative side. They said, but we haven't even told you the subject yet. He said: Oh, the subject doesn't matter. The negative side will take no preparation.

So I understand how easy it is to simply be opposed to everything. The question now, however, is: What do we do to lift this country? What do we do to help lift this country out of this deep recession and give people some confidence that we are on the right road? Perhaps a trade policy that begins to insist on some balance in trade so we are not deep in the red; a budget policy that at some point says you can't spend what you don't have on what you don't need. You have to have some balance in fiscal policy and you have to recognize that. And you have to have a policy on banking and finance that says we're not going to allow you to do this anymore. We are not going to merge the safety and soundness of banking with speculation and risk in real estate and securities. We are not going to do it. If we would take those steps, it seems to me we would give some substantial confidence to the American people.

Passing the legislation that is going to be proposed today or tomorrow--the American Recovery and Reinvestment Act--is not the easiest thing, I understand, because it is counterintuitive to somehow believe that the way out, when you are deep in debt, is to spend some money. Well, I understand that is counterintuitive. Yet all of the lessons we have learned are that you have to prime the pump to put people back on a payroll. If you have half a million people a month losing their jobs, you have to find a way to put people back on the payroll and to inspire some confidence in the economy again.

I have heard discussions today about, well, I worry about this piece or that piece, and people won't go back to work. I am telling you, I think there are a lot of things in this bill that will put people back to work.

I chair the Appropriations Subcommittee on Energy and Water. We have $4.6 billion in this with the Corps of Engineers, and the Corps of Engineers will be repairing mostly bridges and water projects--that are designed, engineered, and ready to go. They will be being hiring contractors who will be hiring workers. The fact is there will be a lot of jobs created with this package--we believe 3.5 to 4 million jobs. That is going to make a difference, I believe.

Having described in some cases our disagreements, let me say that I do think every single person in this Chamber wants the same thing for this country. We perhaps have different approaches to how to get there, but we all want this country to prosper, the economy to be lifted and to recover, for people to go back to work, and for us to have the kind of future that we expect for our children. I believe that is possible. If I didn't believe it was possible, I would hardly be able to go to work in the morning.

Let me tell one story, if I might--I have mentioned it before, a couple of weeks ago--and some people have heard of this. I talked about this guy named Ken Mink from Kentucky, because it is so inspiring. It is so indicative of people in this country who think we can do anything and they can do anything.

Ken Mink, from a news report I read, was 73 years old. He was out in the back yard shooting baskets, and he came in and said to his wife: Honey, it is back. She said what is back? He said: My shot. My basketball shot is back. No matter where I shoot in the back yard, I don't miss. So he sat down that night and wrote applications to colleges--junior colleges--at age 73. He got into a junior college and tried out for the basketball team, at age 73, and made the basketball team. About a month and a half ago, he made two points in a college basketball game. The oldest man, by 40 years, ever to score at a college basketball game, at age 73. I was thinking about that the other day, and I thought: What a wonderful inspirational story, of somebody who didn't understand what he couldn't do. Who says you can't play basketball at age 73 for a junior college some place in Kentucky?

My point is: I think that represents the story of our country. We have so many stories of people who, against the odds, do things that make this a better place. And if we work together and believe in ourselves, and believe in what we have accomplished in decades past and will accomplish in the future, this country is going to be fine. So we are going to get through this week, and hopefully we will give some boost to this economy, and after which I believe we will see an economy that provides more jobs and begins to expand and provides opportunity for American families once again.

Mr. President, I suggest the absence of a quorum.

Mr. President, I ask unanimous consent that the Committee on Armed Services be authorized to meet during the session of the Senate on Thursday, February 12, 2009, at 9:30 a.m.

Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on February 12, 2009 at 10 a.m.

Mr. President, I ask unanimous consent that the Committee on Commerce, Science, and Transportation be authorized to meet during the session of the Senate on Thursday, February 12, 2009, immediately following the Committee's business meeting at 10 a.m., in room 253 of the Russell Senate Office Building.

Mr. President, I ask unanimous consent that the Committee on Energy and Natural Resources be authorized to meet during the session of the Senate to conduct a hearing on Thursday, February 12, 2009, at 10 a.m., in room SD366 of the Dirksen Senate Office Building.

Mr. President, I ask unanimous consent that the Committee on Environment and Public Works be authorized to meet during the session of the Senate on Thursday, February 12, 2009, at 10 a.m. in room 406 of the Dirksen Senate Office Building.

Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Thursday, February 12, 2009, at 2 p.m.

Mr. President, I ask unanimous consent that the Committee on Homeland Security and Governmental Affairs be authorized to meet during the session of the Senate on Thursday, February 12, 2009, at 10 a.m. to conduct a hearing entitled ``Structuring National Security and Homeland Security at the White House.''

Mr. President, I ask unanimous consent that the Committee on Indian Affairs be authorized to meet during the session of the Senate on Thursday, February 12, 2009 at 9:30 a.m. in room 628 of the Dirksen Senate Office Building.

Mr. President, I ask unanimous consent that the Senate Committee on the Judiciary be authorized to meet during the session of the Senate, to conduct an executive business meeting on Thursday, February 12, 2009, at 10 a.m. in room SD-226 of the Dirksen Senate Office Building.

Mr. President, I ask unanimous consent that the Committee on Small Business and Entrepreneurship to meet, during the session of the Senate in the Reception Room, immediately off the Floor to conduct a vote on the Committee's budget and rules for the 111th Congress. The Committee will meet immediately after the first roll call vote occurring on Thursday, February 12, 2009.

Mr. President, I ask unanimous consent that the Select Committee on Intelligence be authorized to meet during the session of the Senate on February 12, 2009 at 2:30 p.m.

Mr. President, I would like to announce that the Committee on Indian Affairs will meet on Thursday, February 12, 2009 at 9:30 a.m. in room 628 of the Dirksen Senate Office Building to conduct an oversight hearing to receive the U.S. Department of the Interior's views and priorities with regard to Indian Affairs related issues in the coming year.

Those wishing additional information may contact the Indian Affairs Committee at 202-224-2251.

Madam President, I always enjoy hearing my friend from Oklahoma. But I regret he feels that what is happening in America today somehow relates to 1992, implying that when Democrats assume power, somehow things are going to collapse, and we find ourselves in a tough situation because all they want to do is spend, and all this and that. The fact is there is plenty of blame to go around with respect to what has happened in this country. It is not one party, it is both parties.

I say to my friend: We have seen a hemorrhaging of red ink in this country the last 8 years. I am not going to spend time talking about it--but I could, and almost should, except I don't think it contributes too much at this time to point out that we decided to go to war and not pay for a penny of it in 8 years, to charge it all and run up the Federal debt. Look, there are a lot of things wrong. A lot of things have been done wrong by the past administration, by Republicans and by Democrats. I understand all that. That is not the issue. The question is what do we do to put it right.

You know, there was a situation in Miami the other day. They had 35 jobs for firefighters and a thousand people showed up to apply. Now, look at these faces. Look at the faces of these people, one by one. All they hope for is an opportunity. A thousand of them showing up, thinking perhaps they will get a shot at one job, because there are only 35 available. These people don't

give a rip whether you are talking about Republicans or Democrats. All they care about is whether you can talk about what might succeed to help put their life back in order, to help put this economy back on track, and to give them a feeling that they might have an opportunity to find a good job, one that pays well and provides benefits, and one that allows them to help take care of their family. That is all they care about. That is why a thousand of them lined up down the sidewalk in search of 35 jobs.

Now, this looks like a crowded picture. But what if we could take a look at 2.6 million of them? There is no picture of the 2.6 million. That is the number of people who lost their jobs last year. Actually, it turned out to be just over 3 million in the last 12 months. What if we had a picture of the last 2 months, with over 1 million people lining up wanting a job because they got laid off? Think of it.

More than one million people had to come home, or call home and say to their family, the person they love, you know what, I have lost my job. No, it is not because I have done a bad job. I have worked here 10, 15, 20 years, and I did everything I could. I got all evaluations that were in the top 5 percent. I am a terrific worker, but I lost my job because the company had to cut back.

I wish we could have a picture of a million people lined up so we would understood the faces and the agony and the despair of losing your job in the last 2 months. And it would describe the urgency. No, not the urgency to come and talk about Democrats and Republicans, but the urgency to talk about what we can do to put this place back on track.

I wonder sometimes whether anyone knows what exactly the right medicine or the right dose of medicine is needed to fix what ails this economy. I confess I don't know. I know what we shouldn't do. I have a pretty good handle on what we shouldn't do. Let's not take the position of being an observer and deciding, you know what, we intend to do nothing. Let whatever happens happen. If our economy is perched on the edge of a cliff and falls off the side to a deep depression, so be it. That is not my position. I think our position has to be to do whatever we can to try to put a foundation under this economy and see if we can lift this economy to provide jobs, provide growth, and expand and give people hope once again.

I have given many speeches on the floor of the Senate about the past. I have talked about what has caused this wreck--and this clearly is a wreck. In 1999, this Congress and the President decided what we wanted to do was to get rid of all those old-fashioned things that were put in place after the Great Depression to separate traditional banking from risk. Let's get rid of all of that and see if we can allow banks to create big old holding companies and merge, and so it happened. They ran that through here like a hot knife through butter, and everybody was fat and happy and singing songs of celebration.

Not me. I voted against all that. I fought against it all. I said at the time that within a decade I thought we would see massive taxpayer bailouts. And we have. The biggest financial institutions in this country, the biggest banks and the biggest financial institutions in this country got involved in a series of risks--buying toxic assets, doing things that were unbelievable--and the whole tent came collapsing down. Then we were told, you know what, it is the taxpayers' responsibility. So the Federal Reserve Board rushes in with a net and a pillow to say to the big financing institutions: We have money for you.

You know, it is interesting. We are told now, at the latest count, that $8.9 trillion--no, not the $800 billion we are talking about on the floor of the Senate--but $8.9 trillion has been used of taxpayers' funds to lend and guarantee certain things, most of it by the Federal Reserve Board and some by FDIC. Most of it was done without a vote. It is done well outside the sunlight of good government. In fact, an enterprising news organization called Bloomberg had to sue the Federal Government to find out how much has been committed.

I don't know that there is some divine right of all the biggest banks in this country--who got bigger and created holding companies and became too big to fail--to be kept to succeed and to continue to live. Maybe--and we won't talk about this much, because no one wants to--we should recreate or create new financial institutions. But no one wants to talk about that. Why is it we decide to invest in failure? Probably we should invest in success. Maybe we should decide, if these financial institutions ran this country into the ditch, to create new financial institutions, to help capitalize those institutions that won't do that.

Again, briefly, as I talk about why we must do something, it is not strange that we have seen this wreckage. I had someone on Saturday at a meeting I was at in North Dakota, saying: You know what, the government has caused all this. I said: I tell you what, the government has plenty to answer for. You are darned right the government has a part of it-- fighting a war without paying for it. Part of it is a trade deficit of $700 billion to $800 billion a year. Most people here are willfully blind about the fact that we are consuming significantly more than we produce. Two billion dollars a day represents our trade deficit, every single day. You can't keep doing that. Our fiscal policy deficits are way out of control because we fought a war and we didn't pay for it. So government has plenty to answer for.

But I told the person who asked me that question--isn't this all the government's fault?--I said: Government didn't put out all this bad paper. That was greedy mortgage companies out there writing bad mortgages, unbelievable mortgages, no different than Madoff's Ponzi scheme, and then packaging them in securities and selling up to hedge funds, and then selling up to investment banks, and the whole country is larded now with toxic assets that we are told threaten the entire banking system. So now the American taxpayer has to be a backstop in order to save the very companies that ran this into the ditch.

You wonder why the smartest in the room, the best and the brightest, didn't understand it was a bad security when you put a mortgage into the hands of someone who can't pay it and then tell them they only have to pay interest; you don't have to pay any principal; in fact, if you don't want to pay interest, you can pay no principal and only partial interest, and you don't have to document your income in order to get a loan from us. Bad credit, no credit, bankrupt, slow pay, no pay, then you come to us. Those were the advertisements by Millennium Credit, Zoom Credit, and Countrywide Mortgage. They all did it, and they put out a lot of bad paper. The whole thing's collapsed.

The banks were all happy because they were all buying these things and they had high yields. And the reason they had high yields is they loaded them up with prepayment penalties, so the borrower couldn't get out of it. So here we are with this system that has collapsed around us, and what are the consequences? Do you think most of the people who did this have lost their jobs with the big banks? Absolutely not. They are still accepting big paychecks. But these people lining up in Miami, a thousand of them for 35 jobs, are the victims of an economy that has collapsed.

The question is: Do we do nothing? Some of my colleagues are perfectly content to do that. They come to the floor and talk about, you know what, this is all about 1992; or let's go back to Calvin Coolidge. How about let's blame it on Calvin Coolidge or Jimmy Carter? It doesn't make any sense at all to be doing that. Let's talk about where we find ourselves and where we want to be and how we might get from here to there.

I confess I don't know exactly what is going to work. I used to teach a little economics in college, but I don't know that there is any economist or anybody who can say that if we do these three things, this is going to work. I confess that we don't know. Normally, there are two tools in the toolbox to try to fix the economic engine of this country: One is called fiscal policy--taxing and spending. But the fact is we have had a stimulative fiscal policy for a long time. We have been running big deficits for a long time, so it is not exactly that that tool hasn't been available. That tool has been used and reused, and I don't know how effective it is. The other tool in

the toolbox is monetary policy. There is nothing in the toolbox left there. Interest rates are down nearly to zero with respect to the Fed and what it charges. So there is not much juice left in monetary policy. But what the Fed has done is used its ability--somewhere in the shadows--to push a lot of money out the door with no transparency as to who got what and how it was used. So I don't know, with respect to the fiscal or monetary policy, the impulses they might have to help fix this economy.

What I do know is this: A piece of legislation--an economic recovery plan--has been put together. That follows on the heels of the $700 billion TARP legislation--the Troubled Asset Relief Program. I voted against TARP, and am happy I did. I didn't think they had the foggiest idea what they were going to do with that money, and I was dead right. I have no idea where it went or what was accomplished with it. There was no accountability and no strings attached. This is different. This legislation is an attempt to say: You know, we can learn at least something from some things that we have tried in the past.

We have an unbelievable backlog in infrastructure investment that should have been made in this country and has not. I will give an example: In the last few years, we have been funding 900 water projects in the country of Iraq with taxpayers' money--900 water projects. We have tens of billions of dollars in infrastructure backlog in this country--of water projects--which we have not been doing what we should about. So how about investing here at home repairing the roads, repairing the bridges, repairing other infrastructure--building the water projects that are authorized and ready to go, fully designed and fully engineered? That puts people to work. It puts people on a payroll. It takes people out of this line and says, we will put people to work even as we build infrastructure for this country's future. Is that a good thing? It seems to me it probably is.

My colleagues have put together a piece of legislation, and I have been a part of it. I was involved in the negotiations last Friday for about 3 hours to see if we could find middle ground, which we have done. We cut nearly $110 billion out of the proposal that existed. I was all in favor of those cuts. It seemed to me there were areas that could and should be trimmed, and now are trimmed from that proposal. But at this point, the question is: What do we do?

I certainly have respect for those who have a different view. Some have a view we should simply use tax cuts, because tax cuts have the biggest juice. But the economists say that is not true. It isn't the case. And besides, if that were the menu, we have been through a decade of that. We know the function of all of that. So I have respect for those who believe that; I just believe there is a different approach. The key is not to use some proxy to put people back to work. The key, at the short term, is to see if you can put people back to work now doing something that represents gainful employment and which will build an asset for this country.

That is what our attempt is here. And, boy, I think there is plenty of reason to be critical. I understand that fully. The question is: Are we willing to do something? I have often told my colleagues, I think it was Mark Twain who was asked once if he would be willing to engage in a debate. He said: Oh sure, as long as I can take the negative side. And the person who asked said: But we haven't even told you what the subject is. He said: Oh, it doesn't matter. The negative side will take no preparation.

So it is easy, it seems to me, to decide what doesn't work and to oppose it. It is much more difficult to decide how you put together something that is constructive and positive that you think will give this country some help and some hope.

I said when I started, I don't know, and no one does, exactly what will work. I told a meeting on Saturday when I was asked the question: Can you guarantee this will work? I said: No, I can't. There isn't one person you can bring into this room who can tell you, yes. If they do, they are not telling you the truth.

What unites all of us is none of us have ever been here before. We have never seen a circumstance where the system of finance has virtually collapsed with toxic assets laced everywhere in the system, a system in which we have had a subprime loan scandal. It has resulted now in the complete collapse of the housing bubble--which was, by the way, aided and abetted by my friend, Alan Greenspan, who was supposed to have been overseeing this sort of thing and did not. But now you have, according to Martin Feldstein, one in four homes in this country in which the home has less value than the mortgage on the home. That is a pretty significant problem.

Then you have 598,000 people told their jobs are gone as of the last month and a half million people the month before. It is running into the millions of people who lose their jobs and lose their homes and then lose hope and lose confidence.

I would say this: When I taught economics--I did the things you do. You teach the supply-demand curves, Gresham's law, and all the things you teach in economics. But, by far, the most important thing I taught students is confidence. If the American people are confident, believe their future will be better than the past, have confidence in tomorrow, then they will do the things that represent and manifest that confidence. They buy a suit of clothes, buy a car, take a trip--they do the things that will expand this economy. Why? Because they have confidence in the future. When they lose confidence in the future and they are unsure of that future, they do exactly the opposite. They say I am not going to make that purchase. I am not going to take that trip. I will not buy that car. That is the contraction side of the economy.

You can do all the things you want to do in the Senate, and the Fed can do all they want to do. The fact is, we are in trouble if we don't provide some way to say to the American people: You can have confidence in this country. You can have some belief that things will be better for your kids than they were for you. So we can start the economic engine on the ship of state and get it moving again. If we can say that to the American people, we will turn this economy around.

I know that there is not just one idea that represents a silver bullet. I understand that as well. But at the end of the day, the Senator from Montana, the Senator from Hawaii, who are managing this legislation--at the end of the day, it is our responsibility, their responsibility, it is the responsibility for us to govern in a way that says to the American people: Here is a plan we think has a chance. Here is an approach we believe has an opportunity to put us back on track once again.

I want to make one final point. Even as we do all of this as best we can to try to help this country recover, it is very important for us to seek accountability, going backwards and forwards. We need to investigate exactly what has happened. We need a prosecution task force, we need a select committee in the Senate, we need to do all these things. We ought to be subpoenaing people in front of committees to say: What did you do? We need to get to the bottom of all of this and make sure it can never happen again.

This notion of deciding self-regulation, quote-unquote, according to Alan Greenspan, works in the interests of everybody--let's understand that. Self-regulation did not work. What happened to us in self- regulation is we were stolen blind and the American people have paid for it now to the tune of maybe $9 trillion and still counting.

We need to put a lot of things back together. I want to be a constructive party of one, saying I want to play a role. Whatever the consequences, I want us to take action to try to help this economy recover.

I yield the floor.

Mr. President, I ask unanimous consent to have printed in the Record the Committee on Indian Affairs Rules of Procedure. There being no objection, the material was ordered to be printed in the Record, as follows:

Mr. President, we have cleared this amendment on both sides. I ask unanimous consent that I be allowed to substitute amendment No. 138, as modified, requiring economic impact reports for my amendment No. 200 for purposes of the previous order.

Mr. President, I ask that amendment No. 138, as modified, be called up.

Mr. President, this amendment is cosponsored by Senator Inouye and Senator Cochran. It is a simple amendment. A voice vote will be satisfactory. I think it has been cleared on both sides.

It simply asks for reports about who is receiving this money we put out in an economic recovery program. Did you receive the money? How did you use the money? And how many jobs do you believe were created with the money? I hope the full Senate will agree with those objectives.

Mr. President, has amendment No. 200 been withdrawn?

I ask that amendment No. 200 be withdrawn.

Mr. President, I ask for a vote on amendment No. 138, as modified.

Mr. President, I ask we consider amendment No. 300.

I ask unanimous consent the reading of the amendment be dispensed with.

I offer this amendment on behalf of myself, Mr. Baucus, Mr. Inouye, and Mr. Brown. It simply says the ``Buy American'' section shall be ``applied in a manner consistent with United States obligations under international agreements.''

I yield the remainder of my time to Senator Brown.

Mr. President, both Mr. Smoot and Mr. Hawley are dead, but this amendment is a part of a very significant debate that is on the floor of the Senate and across the country. Mr. President, 20,000 people a day are losing their jobs--20,000 people a day. We are going to shove a lot of money out the door of this Congress in support of economic recovery. The question is, Are we going to try to put people back to work? Will we put people back to work on America's factory floors making iron and steel and manufactured products?

We already have a ``Buy American'' provision under current law. That is not violative of our trade agreements. We just added an amendment that says this section, the ``Buy American'' section, ``shall be applied in a manner consistent with United States obligations under international agreements.''

I don't think anyone can credibly argue that somehow this undermines our international agreements. But we do have a $700-billion-a-year trade deficit, and my hope would be that as we push this money out the door, we do it in support of American jobs.

Mr. President, I would like to announce that the Committee on Indian Affairs will meet on Thursday, February 5, 2009 at 11 a.m. in Room 628 of the Dirksen Senate Office Building to conduct a hearing on Advancing Indian Health.

Those wishing additional information may contact the Indian Affairs Committee at 202-224-2251.

Mr. President, I suggest the absence of a quorum.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I will speak briefly. I believe Senator Mikulski is perhaps going to offer the next amendment. I do not want to disadvantage the time that has been allotted. I did want to, however, point out that I intend to talk about three amendments very briefly. I filed two of them; I will file the third shortly.

All of us understand what has happened in recent months. In the last 4 or 5 months we have seen money go out the backdoor of this Government unlike any time in the history of our country. In fact, you can read the U.S. Constitution. I don't think you can find a place in the Constitution that describes the mechanism by which massive amounts of money have gone out of this Government--$8.5 trillion, to the extent we now know how much has been moved from our Government to support various enterprises.

The reason we know that is Bloomberg News sued the Government and the Federal Reserve Board, which is the only way anybody got the information about how much money has been obligated by the Federal Reserve Board which opened its discount window for the first time in history to investment banks.

It has never before happened. How much money was committed? We know some snippets of all of that. We know that, for example, Citigroup got about $45 billion, and then we are told we have reached an agreement, along with the direct funding to Citigroup, that we are guaranteeing nearly $300 billion for toxic assets for Citigroup. We know that. We know how much has gone to some of the other investment banks. We know how much money went to AIG. We have a notion of how money went in certain directions. But no one knows exactly how much went out of the Federal Reserve Board, to whom, in what direction, for what purpose. How much from the FDIC, how much from TARP, when, why, how much--we don't know the answers to all of those questions.

Here is what I propose: Last week there was a lot of discussion about bonuses. I believe last year the Wall Street investment firms lost $35 billion in income and paid $18 billion in bonuses to their employees. I don't know. I have a masters in business. We went through a lot of casework in business school. I don't think I came across a case that said: Here is good business--lose $35 billion and then pay $18 billion in bonuses. I don't guess I saw that in the Harvard Business Review.

One amendment is, we ought to, as a government, have the right to understand what kind of bonuses are being paid by firms that are receiving financial assistance under the structure of the financial assistance that has been offered by our Government.

I propose an amendment. It is an amendment that would report bonuses to the American taxpayers. I want all companies receiving emergency economic assistance from any Federal financial agency to publicly release information on any bonuses paid, including the bonus recipients and the amount of the bonuses. The American people have a right to that information. After all, these are companies that have asked for and received Federal assistance. Let's have the American public be able to shine a spotlight on what has happened to that money, including, especially, the use of that money potentially for bonuses.

Second is an amendment I have filed that is what I call the Jobs Accountability Act. This is all about creating jobs. If we are, in fact, about creating jobs, then this proposal would be to say we should have quarterly reports in the Congress after this legislation is passed because tens of billions, hundreds of billions of dollars will have been spent in the pursuit of creating new jobs.

Why is that important? Mr. President, 20,000 people will likely learn today they lost their job, 20,000 people today and every day; 2.6 million last year, and they say 2.6 million more in the first 6 months of this year. This is a deep crater. We have to care about trying to create jobs, putting people back on payrolls to give them some hope and some confidence again.

If we are spending money to do that in what is called an economic recovery program, let's try to track that money. This amendment is very simple. It is the Jobs Accountability Act. What I propose is that when this money goes out the door to the recipients--State

governments, local governments, and others--we ask them to file quarterly reports with the Congress to say three things: One, I received the money; two, here is how I spent the money; and, three, here is how many jobs I estimate we created with this money. It is the only place we will get this kind of information.

Does anybody think we ought to just ship money out the door and not ask for some sort of reporting requirement about how many jobs we created? Otherwise, it is sort of the helicopter theory of money. Get the money in bags, take it up in a helicopter, shove it out the side, and let it scatter. That is not what this is about. We are supposed to be focusing like a laser on jobs. Let's get the reports from everybody who received this funding in order to determine the effect of what we have done. That is an amendment I have filed.

The third amendment I have not filed but will file today is the issue of runaway manufacturing plants. It is something I have worked on in the past with my colleague from Maryland, Senator Mikulski. This is an interesting proposition. We are trying to create jobs because we are losing jobs in this country.

We have a perverse provision in our Tax Code that says this: If there are two companies in Maryland right across the street from each other, making exactly the same product to be sold in this country, in our marketplace, and one of them, on a cool January day, decides: You know what, I am leaving Maryland. I am getting rid of my workers. I am moving my production to China and I will make that product by hiring 30-cent-an-hour labor and I will ship the product back to America to be sold--after that transaction is done. What is the difference between the company that stayed in Maryland and the company that left Maryland to produce in China? The difference is the American company that left and got rid of their jobs and moved to China has a tax bill that is lower than the company that stayed.

We actually provide in this tax system of ours the most pernicious incentive I can imagine, and that is an incentive to say to companies: If you have a choice, we will actually pay you an incentive in the Tax Code to move your jobs overseas. My runaway plant amendment will fix that situation.

I have offered it, I believe, four times with my colleague from Maryland and some others. We have come up short four times. But we have a lot of new Senators who I think would very much like to vote on this amendment. We also have a new President who campaigned on it, a new President who went all across this country and said: Let's stop the incentives for shipping jobs overseas.

This is the perfect place, it seems to me, to have this vote. The reason is because we have a tax bill on the Senate floor now. This is, it seems to me, exactly the wrong incentive. If we are trying to create jobs, why should we have provisions in our Tax Code that move jobs elsewhere? Let's plug that hole, and we can do it with the amendment I will be offering.

My amendment has had over the years many cosponsors and the strong support of my colleague from the State of Maryland. I will file that amendment today. A tax bill is on the Senate floor. If not now, when should we ever plug this loophole that says as a country, we stand behind shipping jobs overseas. Let's say we stand behind keeping jobs here. No tax advantage for those who export them. Let's provide tax advantages, if we are going to, for those who create jobs and keep jobs in this country.

I will be happy to yield.

That is exactly the case. Most people would not even believe that to be the case. They would say: How on Earth would someone have constructed a system that allows that to happen? Oh, but they did, and they have fiercely protected it.

The reason the steel company that stays here pays a higher tax is the steel company that leaves and ships back to this country gets what is called a deferral of income tax; they don't have to pay the tax until some point later. Of course, we know from history and from the history what has been described as being filed to this bill, ultimately if they are repatriated, they get to pay a tax rate of 5\1/2\ percent, something no other American gets to pay. It is a pernicious tax incentive that we certainly ought to put an end to, in my judgment.

That is exactly the case. There is a ``Buy American'' amendment I helped put in this bill that has caused a fair amount of controversy, but it is not violative of any trade agreement. It represents in this bill mostly grants to the States and others for public works projects. It seems to me to the extent we possibly can, we ought to urge the purchase of steel or iron or skids steer loaders in this country to do so. I recognize it is controversial. I am not interested in being violative of any trade agreement that we have, and my understanding is this provision does not violate trade agreements because it will largely come from State grants for public works projects.

I hope to offer the amendment dealing with the tax issue, and I will file that this afternoon. I hope I can get in line so we can have a debate because it is first and foremost about jobs.

Mr. President, there has been a generous amount of discussion and debate. In fact, I was sitting listening to it and curious that my friend from California described those who would speak in opposition as being engaged in demagoguery before she heard the opposition. So there is a clairvoyance here, I guess, before we have an opportunity to speak on these issues. I will not engage in demagoguery, but I will not disappoint her in my opposition to this piece of legislation.

Let me describe what this piece of legislation is. If you like the notion that we want to encourage companies to move their jobs from our country to other countries, then this is the legislation for you. This is an acceleration of what we have done for far too long and what some of us have tried to correct for a long time. There is an unbelievably pernicious provision in our tax laws that says: If you have two businesses right across the street from each other and one of them decides they are going to fire all of their workers and move to China, and they both make the same product and sell the same product in the United States, the only thing that is different once they have moved those jobs to China is the company that left our country and fired their workers ended up with a lower tax bill. What an unbelievable thing to have in the middle of our Tax Code. I intend to try to correct that with another amendment, by the way. But this repatriation tax holiday amendment is kind of a cheerleader amendment for that proposition: Well, we like that; in fact, let's encourage more of it.

Let me straighten out a couple of things with facts. Everybody is entitled to their own opinion but not their own facts.

First of all, the corporate tax paid in this country is not 35 percent. That is a statutory rate. The effective tax rate paid by corporations in America is around 17 percent, not 35 percent. So when we talk about it, let's talk about what is real. All right. So big corporations on average pay 17 percent. But what we have in this piece of legislation is to say those corporations that have, in many cases, moved their plants overseas and made profits overseas with the full understanding in our tax laws that they will at some point repatriate those profits and then pay the corporate tax rate on those profits in our country, this amendment says no, that is not going to be the case. What we are going to try to do is say: If you bring them back, you get to pay a 5.25-percent tax rate--not a tax rate that ordinary folks pay, a tax rate that is almost one-half of the tax rate the lowest income folks pay. That is pretty unreasonable, in my judgment. Now, let me just say that in the ranks of bad ideas, the pantheon of bad ideas, this ranks way up there. It is tired, old, shopworn, and they try to slide it through here with a thick coat of legislative Vaseline, just sort of slip it all through here while we are debating how to promote economic recovery in this country.

Let me just turn to a few facts, if I might. This is the New York Times, Lynnley Browning talking about the one-time tax holiday--this isn't new; we have done this before--in 2004 that offered companies the chance to bring that money back at a reduced rate of 5.25 percent. Put another way, the tax break gave each company claiming it an average of $370 million in tax deductions.

So we are probably not at odds that the proposition is to give very big tax deductions to big companies. That is what this amendment is.

Now, the New York Times. The drugmakers were the biggest beneficiaries of the amnesty program--this is the 2004 program-- repatriating about $100 billion in foreign profits and paying only minimal taxes. That is the purpose of this amendment. But the companies did not create many jobs in return. Instead, since 2005, the American drug industry has laid off tens of thousands of workers in this country.

I was part of that 2004 debate. I remember the claims that were made: Do this. Give a special deal to these companies. They will create jobs. Well, the biggest beneficiaries were the big drug companies. They didn't create jobs; they cut jobs in our country. A success or failure? It seems to me that is a failure, and now we have the same proposition back saying: Let's have another round of this.

Hewlett Packard: $14.5 billion in repatriated profits, 14,500 jobs cut. Colgate-Palmolive. Motorola. I could spend a lot of time, but I got rid of most of those charts, so just to show an example.

This is an editorial by the Chattanooga Times: It shouldn't escape Americans' attention--this is 2005--that U.S. companies have disclosed plans to repatriate some $206 billion in foreign profits--that is as a result of the 2004 legislation--under a one-time tax break allowed by Congress on the grounds--you guessed it--that such a big break would ignite a strong spurt in growth. The upshot, of course, is that no such job spurt appears to be materializing. Some have even announced plans to cut domestic operations and jobs.

Colgate-Palmolive repatriated $800 million in foreign profits and cut 4,450 jobs and shut a third of its plants over the next 4 years. Even the primary advocate--and I mention this because my colleague just mentioned Mr. Allen Sinai--even the primary advocate for the special one-time break, economist Allen Sinai, is now soft-pedaling his reduction of 660,000 new jobs over 5 years. He now says the efficacy of the tax break will be hard to prove.

Well, some other thoughts about this. Michael McIntyre, Wayne State University: There is no evidence that the tax amnesty added a single job to the U.S. economy.

Michael wrote a piece about this in December of 2008.

Again, Michael McIntyre: Most of the repatriated money was used to buy back corporate shares and for other expenditures favoring management. Not exactly something that fits very well in an economic recovery plan. One study found that repatriations did not

lead to an increase in investment, employment, or R&D. Instead, a $1 increase in repatriations was associated with an increase of approximately $1 in payouts for shareholders.

So much for new jobs.

Professors Clemons and Kinney, Texas A&M research study: On average, firms appear to have responded to the opportunity to reap tax savings provided by the act but did not use the funds to increase domestic investment.

Finally, Robert Willens, tax and accounting authority, New York Times article: It was basically worked out to be one big giveaway. The law never took into account the fact that money is fungible.

That is the most important point. Money is fungible. You can say it will create jobs; it doesn't mean anything. It doesn't mean a whit.

So here we are in February of 2009, 5 years after the last time the proposal was made to give a very big tax break by saying to some corporations: You know what, we have tax rates that we want you to pay, but if you are big enough and if some of you move jobs overseas from our country, we will give you a 5.25-percent tax rate.

Now, this is the Bismarck, ND, phone directory. We are not a metropolis and we don't have the largest city in the country, but I could go through this phone directory and read some names. We have a lot of Olsens, by the way, and a lot of Schultzes because we are a lot of Scandinavians and Germans and so on. But I could go through all of these names and ask the question: Do you think Mr. Copeler would like to pay 5.25 percent income tax? I think so. I hope so. How about Mr. Clause? Would he be able to pay 5.25 percent? I am sure he would like it if we just cold-called him and said: What do you think about this? But no person I am aware of will be invited by this Senate to say: We would like to give you a 5.25-percent income tax rate--just the biggest companies in America, many of which move their jobs overseas, and we say: We will give you a big fat reward. We will claim that you are going to create jobs, but we know better because the studies are clear.

As for the studies that have been done about the cost of this, we don't have to debate that. This loses $29 billion in 10 years. There is no debate about that. We only have one entity that makes those estimates. This costs $29 billion in losses over 10 years.

But the major point--which I assume causes the gritting of teeth by those who believe it is demagoguery--is we have been fighting for years to say to American employers: For God's sake, stay here in this country. Don't go in search of 30-cent labor in Shenzhen; keep your jobs here. And many of them said: Tough luck. Take a hike. We are leaving. We are going to go produce Radio Flyer little red wagons in Shenzhen, China. Yes, it was produced in Chicago for decades, years, but tough luck, we are firing all of those folks and we are producing the little red wagon in China.

We are doing the same thing with Huffy Bicycles and with Etch A Sketch. I could talk about a hundred products that are all in China. We gave them all a tax break to leave. Isn't that something?

This now says to American companies that own the product that is now going to be produced in China: If you bring your money back here, we will cut your tax rate by 85 percent.

There is an old country saying, ``There is no education in the second kick of a mule.'' We don't have to relearn what we knew in 2004. Some of us made the case in 2004 that this was an unbelievably bad idea, that it rewards exactly the wrong thing. I am all for tax breaks. I would like to see on this bill a 15-percent investment tax credit that has an end date to it, which says if companies--small businesses and large businesses--make these investments now, before July 1 next year, they will get that. I would like to see a big investment tax credit and require investments in the early period. I am all for big tax breaks for consumers to buy cars and homes. I would like to see people start buying homes and cars again. I think that would help the recovery. I am not opposed to tax breaks. I want us to do things that provide incentives to keep jobs in this country, to create jobs, and we know-- we don't have to guess--this amendment does exactly the opposite. I have heard numbers and studies discussed. This is not rocket science. We have the definitive analysis of what happened in 2004. We have an estimate of what this will cost now.

We lost jobs in 2004 and forward, and this will cost us $29 billion in lost income now. It will say to any other company, if you ever think about moving jobs overseas, understand there are enough people in Congress who in 2004 and 2009 will come up with another idea in 2014 and 2019 that will cut your tax rate to 5\1/4\ percent some day and you will never have to pay your full measure of income tax on profits as an American corporation. This rewards all of the wrong things.

I don't accuse my opponents of demagoging. I think they are wrong and they are using bad facts. We disagree about that. I agree that there are very different opinions on this issue. One is wrong and one is right. Ours happens to be right. There is only one public interest here. The public interest is demonstrable here, not even a close question. I hope if we are talking tonight, on a day when 20,000 Americans lost their jobs--every day somebody comes home and says, ``Honey, I lost my job''--when we are trying to create jobs and restore jobs by creating an economic recovery package, we don't have people coming to the well of the Senate and saying count me in for providing a 85-percent tax cut to big companies that moved overseas, that we know will not create jobs and we know will further deepen the Federal budget deficit.

Mr. President, having given full measure and vent to my concern and interest, I yield the floor.

Will the Senator yield for a question?

The Senator asked me about backtracking. He made the same prediction in 2004 and then backtracked. I predict he will do the same thing.

Mr. President, I don't know what people are to think when they watch this or hear this debate--he said, she said, they said, we said. At the end, the question is, What is real? What are the facts? So let me see if I can uncomplicate this.

This isn't like trying to connect two plates of spaghetti. This is a place of public interest about what should we do to try to create jobs in this country. My colleagues say we are worried because there is so much foreign income overseas. That is not our worry. Our worry is that they have decided to take hundreds and hundreds of billions of overseas income that is required to pay an income tax when it comes back to this country and have said let's give those companies an 85-percent tax cut if they do what they had previously promised they were going to have to do anyway, and that is repatriate this income. That is what we are concerned about.

So let me see if I can put it in the frame of a company--Huffy bicycles. A lot of people worked at Huffy bicycles for a long time. They made $11 an hour making Huffy bicycles, sold in Wal-Mart, Sears, and Kmart, capturing 20 percent of the American bicycle market. But they all got fired. They all lost their job because that company moved to China in search of 30-cent labor in Shenzhen, China. The last day of work at the Huffy plant in Ohio, the workers, as they left their jobs and pulled out of their parking space, left a pair of empty shoes where their car used to park. Their jobs were gone, but it was the only way they could say to their employer, who moved their jobs to China: You can ship our jobs overseas, but, by God, you are not going to fill our shoes. That was the plaintiff

cry of all the folks who lost their jobs who loved to make bicycles.

Guess what. Our Tax Code gives a tax break for shipping those jobs overseas. This amendment continues that very approach and says: By the way, if you ship your jobs overseas and then repatriate the income from what you have earned overseas, we will give you an 85-percent tax break.

I am telling you, it makes no sense. There is no evidence anywhere, no matter what charts you put up, that this created jobs in 2004. It did not. It cost jobs. Allen Sinai, noted economist, yes, he made the same claims then, and then backpedaled. He makes the same claims now. But let's talk a year or so from now, and he will backpedal again.

The fact is, this is a giant tax break to some of the largest companies that cut their tax bill by 85 percent without any evidence they will create jobs. In fact, exactly the opposite evidence exists because we have experienced it, and we lost jobs as a result. This also will cost the American taxpayers $29 billion in lost tax revenue at a time when we are up to our neck in debt.

So you know, let's think of what we are debating. We are debating an economic recovery program. We are going to promote recovery by dragging out a shop-worn, tired old argument that the way to do that is to give an 85-percent tax cut to companies that have earned income overseas, many of whom have fired their American workers and shipped the jobs overseas. I don't think that makes any sense at all.

In fact, if this happens--it happened 5 years ago--if it happens now and it happens 5 years from now, every company will understand, you can move jobs overseas and you will never ever have to pay the corporate tax rate when you bring foreign earnings back. You will always have somebody standing up to say we have a sweetheart deal for you.

Oh, it doesn't apply to the Joneses or the Olsens or the Larsons or the Christiansens, it just applies to the big companies that decided to park that income overseas. I say this: How about a 5.25-percent income tax rate for every American, rather than just a few of the biggest companies? How about all of us get a chance to get some of this 5.25 percent income tax rate? I don't think that is being proposed. Let me propose that.

Ten minutes.

Madam President, let me thank my colleague, the Senator from Vermont, the chairman of the committee, for his work on the Judiciary Committee. I do not serve on that committee, but I come to talk just a bit about the nomination of the new Attorney General and about the Department of Justice.

The reason I say I appreciate the Senator from Vermont is because he waged a relentless struggle at a time when the Justice Department was involved in the long shadow of scandal, at a time when words from the Justice Department, from the Attorney General at that point, seemed to suggest torture was OK. It was a time when the Department of Justice seemed to say that people could be detained on the streets of America and held incommunicado without a right to an attorney. These were things that I believed were far afield from what we expect as basic rights in our country and the Chairman of the Judiciary Committee waged a long and brave battle against them. And, I want to thank him for that.

But, let me talk about Eric Holder in the context of what I just described and why I think this nomination is so important. You have heard a lot about how highly qualified Eric Holder is--about his lifetime of impressive public service, about his history as an independent, tough-as-nails prosecutor, about the long list of organizations that support him as very qualified, and about the many prominent Democrats and Republicans that support him.

But, I want to talk about Eric Holder as a key part of restoring justice to the Department of Justice.

We have been through a long period of difficulty at the Justice Department. I am not talking now about the stewardship of Mr. Mukasey. I am talking about specifically a period when Attorney General Gonzales was in charge.

The Attorney General is the senior person in our country responsible for ensuring that justice is done. That means many things. It means, certainly, evenhandedness; it means justice under the law; it means occasionally saying no to those who want to do the wrong thing, no matter how powerful or important they might be. It means everyone, from the lowest to the highest, gets treated equally and fairly under the law in this country.

The Attorney General is the senior most Government official responsible for justice. That is the person who has to stand for, and stand up for, our country as a nation of laws. That is the person who needs to be the defender of human rights, who must believe in America as a beacon of hope in the world, a beacon that shines from America into the darkest places at the darkest times.

The Attorney General, as the head of the Justice Department, is the one who is involved in that kind of activity and sends that message from our country. An Attorney General should be someone who can say torture is un-American because it is. No splitting hairs, no fancy words, no legal distinctions--just these simple words: Torture is wrong.

Mr. Holder has said that to us in his nomination hearings. He said, ``Torture is wrong'' and ``No one is above the law.'' Those are very simple and straightforward words from this nominee, but I think they are timeless principles, timeless truths that America has exhibited now for nearly 200 years.

Why is that important for us? The most powerful weapon in our country is what we stand for. That has always been the most powerful weapon in America.

We had a long struggle in the Cold War against the Soviet Union and totalitarianism. The Cold War occasionally flared up to a hot war with bombs and bullets. But, it was not the bombs and bullets that won the Cold War with the Soviet Union. It was American values that won that Cold War.

That is why we prevailed. We must never forget that American values were so strong that they shined the light of hope into the darkest cells of the gulag prisons in the outermost reaches of the Soviet Union. Many of those prisoners died in their cells, but some survived and talked about how inspired they were by the ideas and values of what was America. Our country gave them hope. The idea of America, as I said, reached to the farthest and darkest places on this Earth and offered hope to people--people struggling, people in grave difficulty.

There was a very clear and distinct difference between us and the Soviet Union during that Cold War, and everyone knew what it was. It wasn't our military might or the comparison of our military capabilities. It wasn't our bombs or bullets. It was what each country stood for. When the people of the Soviet Union and their client states finally had a choice, they chose democracy and freedom and liberty. That is how powerful the idea of America has become.

This moral ground has always been our country's strength. We must insist on keeping that high moral ground--not only because it is effective, but because it is right and because it is our birthright as Americans.

From the very beginning our country has held itself to a higher standard, as in the story of George Washington and the fight to found America. He led the Continental Army in the war for independence. It is a pretty interesting story, if you go back and read it.

Madam President, 5,000 were in the Continental Army that George Washington commanded, 5,000--but not trained soldiers. They were shopkeepers, farmers and tradesmen going up against a 50,000-man trained army of British soldiers. We know the result, but we don't always remember the battles along the way, military battles and, yes, battles over values and ideals.

There were many difficult periods during that war, and there were some very dark days. During one very difficult period, at a time when a large number of his troops were captured, Gen. Washington and his troops saw the Hessian mercenaries, who at that point were fighting along with the British, slaughtering unarmed prisoners. Washington, when he captured Hessian prisoners, refused to do the same. Washington insisted we were different; we were going to treat people the way they should be treated not the way they treated us.

That was George Washington's notion about who we are and why we are different. That has been America's birthright since the beginning of our country.

It is why this issue of torture is so important. It is why the discussions about detainee treatment and enemy combatants and habeas corpus are so important. These issues are about who we are as a country, as a people, and who we want to be.

I remember reading one day that a man was picked up at a New York City airport and then sent away, not to be heard from for a long while by his family or by anybody. It turns out he was sent to Syria where he was tortured for 8 to 9 months, kept underground in concrete cells in isolation. It turns out it was a huge mistake. This person was not who he was thought to be; he was not a terrorist.

Yet, on American soil, he was detained and then sent away to be tortured. He was a Canadian. The Government of Canada, by the way, has apologized to that citizen for that situation. But it describes why it is so important that the rule of law always be applied.

So this discussion about the Attorney General, about this nomination, about the Department of Justice, is about much more than just nominating someone for a Cabinet position. It is about what do we aspire to for our country and ourselves. What kind of Government do we want? What kind of Government will we allow? What kind of country do we want?

I go back again, as I said, to the long, dark shadow that was cast for a period of time over the Justice Department, when it was engaged in scandals and

scandalous conduct. There were very important questions about what was happening at the Department of Justice. Frankly, there were grave questions of what was happening to justice at the Department of Justice.

The Senate Judiciary Committee was relentless in trying to understand it and hold hearings and get answers. Very few answers, frankly, were forthcoming. Thankfully, those days are over.

We now have the nomination of Eric Holder. The Judiciary Committee voted 17 to 2 to support his nomination. Like them, I believe Eric Holder represents an opportunity for our country to have someone at the Justice Department who does understand what the Department of Justice stands for and where it fits in our value system. I am pleased to come to the floor of the Senate today to say, when we discuss these issues we must discuss what are the values, the ideals, that this country stands for and how those whom we intend to put in very high places--how do they comport to those standards and values? How will they conduct the office for which they are nominated?

I believe strongly in the nomination of Eric Holder. As you have heard, he is highly qualified in experience, skills and temperament. As important, he understands the values of our country and the importance of justice. I have no doubt that Eric Holder will be an excellent Attorney General, will restore justice to the Department of Justice, and will uphold and further the historic values and ideals of our country, which will again be a bright shining light for justice and hope throughout the world.

I yield the floor.