Floor Statements

Mr. President, today we were able to reach an agreement that would permit the Senate to begin consideration of the Omnibus appropriations bill on Monday. The bill will be open for debate and amendments on Monday; however, there will be no rollcall votes. Senators should expect the next vote Tuesday morning.

Mr. President, if there is no further business to come before the Senate, I ask unanimous consent that it stand adjourned under the previous order.

Madam President, I ask unanimous consent that the order for the quorum call be rescinded.

Madam President, I ask unanimous consent to speak as in morning business.

Madam President, the collapse of Wall Street that precipitated today's economic crisis has many causes--from regulatory failures to recklessness and greed.

But before Congress begins writing new rules, one more factor we must examine is criminal behavior by anyone, from the local mortgage broker to some of our biggest banks. Let's commit ourselves to enforcing the laws that were on the books and to throwing those who broke them in jail.

I am not prejudging anyone. We may well find that only a small percentage of cases involved outright criminal behavior, and we must take care that our anger does not cloud our judgment. But people know that if they rob a bank they will go to jail. Bankers should know that if they rob people they will go to jail too.

We have seen anecdotal evidence that mortgage brokers may have fraudulently solicited mortgages or used predatory practices; bankers may have neglected due diligence in the design and marketing of some mortgage-related products; credit rating agencies may have been conflicted by the fees they earned from the very bankers whose shaky products they stamped ``AAA,'' the highest credit rating; and, finally, as the housing bubble burst, banks may have engaged in a widespread failure to disclose material information as they went from supposedly profitable institutions to insolvent overnight, leaving investors holding the bag.

Where were the lawyers and accountants who are paid to keep an eye on such actions? Was there so much cash around that the professionals who make these deals possible became blind to their duties?

Attorney General Eric Holder has emphasized it is only by drilling down into the records of complicated financial transactions that Federal law enforcement officials can understand exactly what happened and investigate the people and firms involved. Unfortunately, right now, the resources are not available to do so.

That is why Senate Judiciary Committee chairman Pat Leahy, Senator Chuck Grassley, and I introduced S. 386, the Fraud Enforcement and Recovery Act of 2009. This is a bipartisan bill. It provides financial support to the investigative arms of Federal law enforcement and regulatory agencies so they can find the crimes we know have already been committed. It also amends fraud statutes to protect us against those who may be tempted to cheat like this in the future.

At a recent hearing, FBI Deputy Director John Pistole testified that the

very necessary shift of resources to counterterrorism efforts--it was right to shift resources in the FBI to counterterrorism efforts--has had a significant impact on the FBI's ability to investigate sophisticated financial crime.

Mr. Pistole said the increasing financial fraud caseload ``is straining the FBI's limited white collar crime resources.''

Currently, the FBI has only 240 agents investigating complex financial fraud. During the savings and loan crisis in the 1980s, the FBI had more than 1,000 agents investigating financial fraud. We must increase dramatically the number and training of FBI agents investigating financial fraud.

Mr. Pistole told the committee the FBI is already investigating 530 open corporate fraud investigations, and only 38 of those are directly related to the current financial crisis.

Again, as Mr. Pistole said:

More must be done to protect our country and our economy

from those who attempt to enrich themselves.

This bill authorizes $155 million a year for hiring fraud prosecutors and investigators at the Justice Department for 2010 and 2011. That amount includes $65 million a year for 190 additional FBI special agents and more than 200 professionals to fight white collar crime.

We know prosecuting bad behavior by itself will not put an end to all bad behavior, but it will make those people in the boardrooms, at the trading desks, and in the mortgage industry think twice before they look the other way, give way to greed over financial duty or deal from the bottom of the deck.

I believe deeply in the free market economy. I believe deeply in capitalism and the importance of an open financial system. Indeed, I believe our very democracy depends on fair and functioning markets. That is why we simply cannot give a pass to this kind of illegal behavior.

The men and women who duped would-be homeowners, who defrauded the American investor, who contributed to an economic crisis of historic proportions, need to be identified, prosecuted, convicted, and thrown in jail. And in cases where the conduct falls short of criminal, our regulators must also pursue civil cases to force perpetrators to pay back their ill-gotten gain and bar these people from future securities work.

I have heard people say prosecutors must tread carefully, that the law is a blunt instrument. They will say that if we turn prosecutors loose on our key financial institutions, the economic repercussions will outweigh any benefits.

To that I say: Of course, we must be judicious, but the law of the land applies to everyone. When it is pointed at you, the law can always be characterized as a blunt instrument.

At the end of the day, this is a test of whether we have one justice system in the country or two. If we do not treat a Wall Street firm that defrauded investors of millions of dollars the same way we treat someone who stole $500 from a cash register, then how can we expect our citizens to have any faith in the rule of law?

For our economy to work for all Americans, investors must have confidence in the honest and open functioning of our financial markets. Our markets can only flourish when Americans again trust that they are fair, transparent, and accountable to the laws.

In closing, I applaud Chairman Leahy and Senator Grassley for their leadership on this issue. I am proud to join with them in this effort. I am hopeful the Judiciary Committee will approve this bill when we take it up on Thursday.

I yield the floor and suggest the absence of a quorum.

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

Madam President, I ask unanimous consent the Senate proceed to a period of morning business with Senators permitted to speak for up to 10 minutes each.

Madam President, I ask unanimous consent that the Senate proceed to the immediate consideration of S. Res. 52, submitted earlier in the day.

Madam President, I ask unanimous consent that the resolution be agreed to, the preamble be agreed to, the motions to reconsider be laid upon the table, with no intervening action or debate, and any statements related to the resolution be printed in the Record.

Madam President, I ask unanimous consent that when the Senate completes its business today, it adjourn until 10 a.m. tomorrow, Tuesday, February 24; 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 the motion to proceed to S. 160, the District of Columbia House Voting Rights Act of 2009, with the time until 11 a.m. equally divided and controlled between the two leaders or their designees; further, that the Senate recess from 12:30 p.m. to 2:15 p.m. to allow for the weekly caucus luncheons.

Madam President, at 11 a.m. tomorrow, the Senate will proceed to a cloture vote on the motion to proceed to S. 160, to be followed by a cloture vote on the executive nomination of Hilda Solis to be Secretary of Labor.

As a reminder to Senators, tomorrow, at 9 p.m., there will be a joint session of Congress to receive a message from the President. Senators should gather in the Senate Chamber at 8:30 p.m. to proceed as a body at 8:40 p.m. to the Hall of the House of Representatives.

Madam President, if there is no further business to come before the Senate, I ask unanimous consent that it stand adjourned under the previous order following the remarks of Senator Bill Nelson.

Madam President, I suggest the absence of a quorum.

Mr. President, I want to bring my colleagues' attention to an important hearing held this past Wednesday by the Judiciary Committee. We have been focused on the economy over the past few weeks, and particularly on the recovery bill that will soon start saving and creating jobs.

But there are more steps we need to take to restart our economy. One step is to renew confidence in our markets, by cracking down on the kind of criminal behavior that has contributed to our current crisis. I am talking about fraud in our financial markets.

On Wednesday, Chairman Leahy convened a Judiciary Committee hearing on financial fraud. We heard testimony from John Pistole, Deputy Director of the FBI; Rita Glavin, Acting Assistant Attorney General for the Criminal Division; and Neil Barofsky, Special Inspector General for the Trouble Assets Relief Program.

I will ask to include in the Record, following my remarks, three articles reporting on the hearing.

Two things became clear at the hearing: First, that the Justice Department's Criminal Division, the FBI and the Special Inspector General are deadly serious about finding and prosecuting financial fraud.

FBI Deputy Director Pistole told the committee that the agency is investigating 530 open corporate fraud investigations, including 38 directly related to the current financial crisis. He said the total number of fraud investigations has nearly doubled, from 881 in fiscal year 2006 to 1,600 in fiscal year 2008.

Second, we learned that Federal law enforcement needs additional resources to do so effectively.

According to Deputy Director Pistole ``The increasing mortgage, corporate fraud and financial institution failure case inventory is straining the FBI's limited white collar crime resources.''

The FBI's very necessary shift of resources to counterterrorism efforts has had a significant impact on its ability to investigate sophisticated financial crime.

Currently, the FBI has only 240 agents investigating complex financial fraud.

During the savings and loan crisis in the 1980s, the FBI had more than 1,000 agents investigating financial fraud connected to that scandal.

Mr. President, it is clear we need to scale up dramatically the number and training of FBI agents investigating financial fraud, because the financial meltdown of 2008 is much bigger than the savings and loan crisis.

That is why I was proud to join with Chairman Leahy and Senator Grassley to introduce S.386, the Fraud Enforcement and Recovery Act of 2009.

Mr. President, I look forward to working with Chairman Leahy and Senator Grassley to pass this important legislation, and I applaud them for their leadership.

Mr. President, I ask unanimous consent to have the three articles to which I referred printed in the Record.

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

Mr. President, I rise today to add my voice to those who feel the urgency of our economic crisis.

I don't need to repeat all of the arguments that have been made this week and last. All Senators can see with their own eyes that this is the greatest economic challenge we have faced since the Depression.

But we have the advantage of history. History shows us that in times of crisis, government must act decisively.

Where Herbert Hoover didn't, jobs and livelihoods crumbled. Where Franklin Roosevelt did, American families got a new chance at the security and dignity of work.

Now, once more, we must act.

This economic crisis is enormously complicated, and no economist can truthfully claim to know the full measure of our challenges. But, in a sense, it is simple.

Consumer spending makes up two-thirds of our economy.

With falling home prices, plummeting retirement accounts, and vanishing jobs, American consumers have less and less to spend. As the consumer economy shrinks, workers are laid off and savings accounts dwindle, causing those consumers to spend even less.

Consumers have stopped spending, banks have stopped lending, businesses are laying off workers. The private sector is shrinking.

Only the Federal Government can fill the gap. Only the Federal Government has the ability to put enough money back into the economy to turn our economy around. Only the Federal Government is big enough.

This is no excuse for wasteful and careless spending, and that is why I have pushed for more accountability in how we spend this money.

I supported increasing funding for our inspectors general and conducting a review of how well they are doing their job.

I have worked to make State spending more accountable and to restore reason to compensation for executives whose companies the taxpayers have kept afloat.

The American people have a right to know where all this money is going, and we in the Congress have a duty to do all we can to crack down on fraud and abuse.

I also remind my colleagues that we need to act quickly.

The longer we delay, the more families lose their livelihoods, their health care, their sense of security. The

longer we wait, the deeper this hole gets, and the harder it will be to get out of it.

As the President so eloquently reminded us last night, job losses are accelerating. In the last year, we have lost 3.6 million jobs--and half of those were in the last 3 months. In January, we lost 20,000 a day.

The longer we wait, the worse things will get. The longer we wait, the more it will take to turn our economy around. We can't afford to wait any longer.

I support the American Recovery and Reinvestment Act, because I believe we need to act soon. It will create 4 million jobs, and that is what this package should be about: jobs, jobs, jobs.

I believe that this is a good bill, but I wish to offer a couple of thoughts about how we could make it better.

As we go forward on conference negotiations with the House, I urge my colleagues to restore the education and State stabilization funding that was removed from the bill.

Because of the collapsing economy, my State of Delaware is facing a budget shortfall of $600 million, 20 percent of the State budget. The new Governor, Jack Markell, is staring at tremendous budget cuts if we do not act, when fully a third of the State budget goes to education.

That is why I hope my colleagues will find a way to restore the education funding and State stabilization funding that was removed. I hope they will help Governor Markell and the 49 other Governors. Both the education funding and the State stabilization funding affect the ability of states to keep teachers in the classroom and to repair, renovate, and construct schools. These school construction projects not only create--and save--jobs, but are also good long-term investments for our children and grandchildren.

For too long, I have heard stories of children in crumbling schools, with outdated textbooks and outdated computers, if they have any. To give our children a fair chance, to compete with the rest of the world, to keep America's economic future bright, we must make a downpayment now.

And in education, we have a downpayment that can create jobs now. In my State of Delaware alone, $68 million of shovel-ready school construction projects are awaiting our help.

I will close, Mr. President, with this thought. Our children, if they could speak with one voice, want only what all Americans want: a fair shot, a fighting chance, an equal opportunity.

The people I talk to in Delaware just want a chance. They are willing to work hard, and they have. They are willing to play by the rules, and they have. They want to save for tomorrow. In return, all they ask is a job they can rely on, a home for their families, and a government that will help them out when they need a hand.

The Senate bill focuses on keeping and restoring jobs. It will begin the task of slowing and reversing our economic troubles, and I hope we can get a final bill to the President soon.

I yield the floor and suggest the absence of a quorum.

Mr. President, as we struggle to restore growth and hope to our economy, we must continue to repair the weaknesses in our legal and regulatory system weaknesses that contributed to the crisis we face today. A lot of what has happened to our economy was the result of greed and incompetence. But too much of it can be traced to fraud, insider deals, and other acts that are illegal, and to actions that should be illegal.

That is why I am joining today with Senator Leahy and Senator Grassley to introduce the Fraud Enforcement and Recovery Act of 2009. As we survey the damage to every aspect of our economy from manufacturing to retail, from construction to services we can trace the origins of this disaster to the real estate market and the financing that drove a bubble that finally burst.

We now know that behind the explosion in housing values, and the explosion in the secondary market for mortgages, were misrepresentations, false reporting, insider deals, and other forms of fraud. Many of these actions clearly broke existing financial regulations and consumer protection laws. Others took place in so- called ``shadow'' financial markets that are outside of our existing laws.

The legislation we are introducing today will provide the Justice Department with the resources it needs to prosecute the crimes that played a part in precipitating the crisis we are now facing. The FBI has been overwhelmed by reports of mortgage fraud, now running at over ten times the pace of a few years ago.

The bill authorizes $155 million a year for hiring fraud prosecutors and investigators at the Justice Department for 2010 and 2011, including $65 million a year for 190 additional FBI special agents and more than 200 professionals to fight white collar crime.

In addition, this bill exposes some of the ``shadow'' financial systems to the fraud laws that apply today in the better regulated sectors of our banking industry. It also extends antifraud protections to the money we are sending out under the Troubled Asset Relief Program and the economic stimulus package. It also amends Federal securities laws to cover fraud schemes involving commodities futures and options, including so-called derivatives involving the mortgage-backed securities that caused such damage to our banking system.

Further, this legislation will strengthen one of the most effective tools to combat waste and fraud in government the False Claims Act. We will need these improvements so that we can protect the taxpayer dollars we are using to respond to the economic crisis.

I hope we can move this legislation quickly. It moves against the root causes of this economic crisis and improves protections for the taxpayer funds we are committing to fight it.

Mr. President, as we struggle to restore growth and hope to our economy, we must continue to repair the weaknesses in our legal and regulatory system weaknesses that contributed to the crisis we face today. A lot of what has happened to our economy was the result of greed and incompetence. But too much of it can be traced to fraud, insider deals, and other acts that are illegal, and to actions that should be illegal.

That is why I am joining today with Senator Leahy and Senator Grassley to introduce the Fraud Enforcement and Recovery Act of 2009. As we survey the damage to every aspect of our economy from manufacturing to retail, from construction to services we can trace the origins of this disaster to the real estate market and the financing that drove a bubble that finally burst.

We now know that behind the explosion in housing values, and the explosion in the secondary market for mortgages, were misrepresentations, false reporting, insider deals, and other forms of fraud. Many of these actions clearly broke existing financial regulations and consumer protection laws. Others took place in so- called ``shadow'' financial markets that are outside of our existing laws.

The legislation we are introducing today will provide the Justice Department with the resources it needs to prosecute the crimes that played a part in precipitating the crisis we are now facing. The FBI has been overwhelmed by reports of mortgage fraud, now running at over ten times the pace of a few years ago.

The bill authorizes $155 million a year for hiring fraud prosecutors and investigators at the Justice Department for 2010 and 2011, including $65 million a year for 190 additional FBI special agents and more than 200 professionals to fight white collar crime.

In addition, this bill exposes some of the ``shadow'' financial systems to the fraud laws that apply today in the better regulated sectors of our banking industry. It also extends antifraud protections to the money we are sending out under the Troubled Asset Relief Program and the economic stimulus package. It also amends Federal securities laws to cover fraud schemes involving commodities futures and options, including so-called derivatives involving the mortgage-backed securities that caused such damage to our banking system.

Further, this legislation will strengthen one of the most effective tools to combat waste and fraud in government the False Claims Act. We will need these improvements so that we can protect the taxpayer dollars we are using to respond to the economic crisis.

I hope we can move this legislation quickly. It moves against the root causes of this economic crisis and improves protections for the taxpayer funds we are committing to fight it.

Mr. President, I am fortunate to have heard the remarks of the Senator from Maine. They are excellent, and I find so much of it I agree with.

I am a brandnew Senator, but I have been around the Senate for 36 years. I think in those 36 years, this is truly one of the historic moments in all the years I have been following the Senate. We are about to embark on a task that will test this institution, as we begin the debate on the response to the profound economic crisis we face.

Last Monday, as my first full week as a U.S. Senator began, thousands of American workers lost their jobs. In a single day, tens of thousands of families lost their breadwinners, men and women lost the dignity that comes with work, and States and cities across the country lost the productive labor and the tax revenues those workers have provided.

This was just a single bad day. But over the last couple years, the news from our economy has been increasingly disturbing. American payrolls shrank by over 2.5 million jobs last year, including 524,000 in December alone, touching every corner of this country. The accelerating pace of unemployment tells us there is more bad news to come. Along with laid-off workers, we have unused productivity capacity. Thirty percent of our manufacturing strength is idle.

It is no wonder that Americans are cautious about spending. But their caution, as we know, is reinforcing the slowdown.

With that decline in consumer spending, our retailers are shutting their doors, laying off sales staff and management. With declining sales, manufacturers are laying off workers and shutting down assembly lines. Responses that are perfectly rational for individuals making their own decisions only add to our problems, making us all worse off.

Our jobs, our savings, our homes, our credit--all are under siege. Left alone, we know things will only get worse. We have to break that vicious cycle.

I remind my colleagues of these troubling trends because as bad as things are, they can get worse. Because we have failed to revive employment, consumer spending--the key to today's economy--and consumer confidence--the key to tomorrow's economy--remain in a slump. Because we failed to restore stability in home prices, foreclosures continue to spread. Because we have failed so far to clean up our banking system, lending and borrowing are drying up.

That is the real urgency behind the task of building an effective economic recovery plan because if we fail to act, we can be sure that we will lose more jobs, lose more homes, and reduce the value of our economy.

Because so much has gone wrong, our recovery plan must tackle many different problems at the same time. Because so much of our economic value has been lost, the scale of our response must be equal to that challenge. Because of the risk of further decline, our response must be rapid.

That is why the Senate is beginning debate today on a historic economic recovery investment program for America. We must do something dramatic to turn our economy around. At the same time, the American people will rightly judge whether we have used this moment wisely, whether we have invested these hundreds of billions of dollars of their hard-earned dollars in ways that will improve their lives.

Job creation and job preservation must be our goal. Jobs, jobs, jobs. Every job lost is another blow to our economy, losing productive work, spending power, and the revenue that supports the education, health care, roads, water, police, and fire protection provided by our State and local governments. Every job lost is truly a human tragedy, for the man and woman who loses the dignity of work, and the families thrown into turmoil.

One important way to create jobs is make more investments that will make our economy more productive--clearly, roads, bridges, clean water. A smart power grid, as we discussed with former Vice President Al Gore last week in the Senate Committee on Foreign Relations, could become to our economy what the railroads were in the 19th century, what the highways were to postwar America, and what the Internet has meant to our digital age. And as we discussed last week in the Judiciary Committee, we can revolutionize health care records and at the same time save billions of dollars while digitizing paper records, making sure we have appropriate privacy safeguards. We can improve health care, save money, help protect our patients, and create jobs. We will need to install new computers, routers, and software and educate and train the people with the skills to make the system work.

Listen, as jobs are created, consumers will be able to spend, homeowners will be able to keep up with their mortgages, families will be able to keep their kids in college. That is what economic recovery means, and that is what we have to do.

Finally, just as important as the jobs we create will be jobs preserved by keeping State and local governments able to provide the schools, the health care, the police and fire protection that we cannot do without. They will need teachers, nurses, firemen, policemen, and health inspectors on the job. Just today our congressional delegation from Delaware met with the Governor of Delaware. This crisis, just in Delaware alone, has slashed our revenue projections by $.5 billion in just 6 months. We face a $600 million deficit, which will require shutting down services and laying off workers. This will add to the economic slowdown and reduce the services on which our citizens depend.

Support directly to State and local governments will get out to where it is needed. We know that because we know those governments are now forced to cut back in the face of declining economic activity and revenues. They need the money and they will use it. We have to get it to them.

This crisis has knocked a big hole in our economy, and it is essential we fill it quickly. Because of the size and speed of this task, we must also have extraordinary oversight and transparency to assure Americans that we are doing this right and that we are doing it openly. We must have additional resources and people dedicated to the sole purpose of auditing and investigating economic recovery spending. We must have transparency. We must make public all of the grants, contracts, and the oversight activities themselves. This is a historic undertaking, and we must have a historic level of transparency and oversight.

During my years of experience with the Senate, I have developed a deep respect for this very unique institution. I have seen it tested in war and peace, in good times and bad. The debate on our economic recovery plan this week is precisely the task for which this body, the Senate, was created. This is a moment that will test this institution. We must deliberate, we must debate, we must decide. There are no easy choices this week. There will be no easy votes. But I am convinced the Senate will meet this test, just as I am convinced our country will meet the test of these extraordinary times.

Mr. President, I yield the floor.

Mr. President, I ask unanimous consent the Senate proceed to a period of morning business with Senators permitted to speak up to 10 minutes each.

Mr. President, I ask unanimous consent that a communication to Senator Byrd from the Office of Compliance related to the USERRA regulations be printed in the Record.