Floor Statements

Mr. President, I rise to engage in a colloquy with my colleague from Rhode Island, Mr. Whitehouse, and my colleague from West Virginia, Mr. Rockefeller.

Mr. President, I want to thank the chairman of the Commerce Committee for his leadership in advancing this bill. As he, Senator Whitehouse, and I have discussed, there is significant concern with respect to the safety and security of proposed liquefied natural gas, LNG, facilities throughout the country. Given the Deepwater Horizon disaster in the Gulf of Mexico, we know that no system for handling volatile substances is fool-proof.

Over the last several years, the people of Rhode Island have been greatly concerned about proposals to develop LNG facilities on or in close proximity to Rhode Island's shores, as well as proposals to transit LNG traffic through our waterways. I have come to the floor on many occasions to express my deep concerns about the wisdom of these projects; not as a matter of reflexive opposition to LNG but as a matter of the appropriateness of siting these facilities with little State control.

This includes a proposal in the Commonwealth of Massachusetts that will have significant impact on the State of Rhode Island, as it calls for vessels to transit through Narragansett Bay and off-load at an offshore berth in Mount Hope Bay just outside of Rhode Island waters. Over the years, members of the Rhode Island and Massachusetts delegations have raised concerns about this project, but the most severe impacts of the vessel traffic and related safety and security measures will be on Rhode Island, which has very little authority to influence the process. The Coast Guard has the responsibility of issuing so-called Letters of Recommendation to establish the suitability of a waterway to accommodate this type of vessel traffic and operation. Its determination is critical in the siting LNG facilities. Unfortunately, Rhode Island, like other states, has little recourse to object to the findings or conditions laid out by the Coast Guard, even though the bulk of the vessel activity will take place in its state waters. I believe the state should have a say about the appropriateness of activities in its waterways and should be consulted, especially about the broader impacts of LNG facilities and vessel traffic on other waterway users and on communities.

Although the underlying House bill includes a port security title, the substitute does not. While I recognize that and that the Committee will be dealing with port security legislation later this year, I think that it is critical that we act on this issue as soon as possible. I would like to work with the Chairman in crafting that bill, but I would also ask for his commitment to work to address the issues related to LNG facilities during conference with the House on the Coast Guard Reauthorization bill.

Thank you, Mr. Chairman. I look forward to this issue being addressed in the final Coast Guard Reauthorization bill.

Madam President, the Republican side has submitted a consumer protection amendment that can be briefly summarized: Buyer beware because they won't help you. This flows from the very simple premise that they have announced from the very beginning of these discussions and deliberations they do not want an independent consumer protection agency that has the authority to make rules and enforce rules to protect consumers. So what they have suggested is a classic bait and switch. We will create an ``agency'' within the FDIC, and then we will deny them the power to regulate most of the financial sectors and institutions that affect the daily lives of Americans: payday lenders, car loans, all those things. They are just off the table. So it amounts to a gesture, not good legislative policy.

We are working, and we have been working--and Senator Dodd has taken the lead--to ensure that there is real consumer protection built into this Wall Street reform legislation. We believe consumers need information to make good choices. The thrust of our efforts is to ensure that the agency is able to provide that information through simplified forms, through simple products, through those mechanisms that allow men and women who are engaged in raising children, keeping jobs, coaching Little League, to understand what they are putting their resources into.

That is not what the Republican amendment is proposing to do. They are creating a six-person council within the FDIC with no real independence and even less authority, and one could question why the FDIC is the logical place to put in a council such as this. They would create an oversight agency but exempt, as I said, virtually an entire financial sector or sectors from oversight. It is not like a watchdog; it is like a lapdog. It is bureaucracy with no bite.

The Dodd bill, in contrast, contains a very robust consumer protection provision. It creates a Consumer Financial Protection Bureau with resources--I wish to emphasize resources--and authority to prohibit abusive practices and deceptive financial products, ranging from credit card companies to mortgage brokers to banks and to others. For example, it would hold the credit card companies accountable and eliminate unfair lending practices, such as penalty fees for paying off your debt on time.

One of the big efforts we are undertaking is increased transparency for Wall Street, and this consumer protection agency will provide that protection to consumers. Basic economics, Econ 101: In a competitive marketplace, one of the presumptions is perfect information. We have seen, frankly, that individuals on Wall Street have made billions of dollars operating on imperfect information; in fact, one could even suggest deliberately manipulating products so they have the information and the consumer doesn't.

I think we were all taken aback when we were listening to the hearings conducted by Senator Levin which talked about Goldman Sachs, and their trader, Fabrice Tourre, described the system in rather evocative terms. In his words:

More and more leverage in the system, the entire system is

about to crumble any moment . . . the only potential survivor

the fabulous Fab . . . standing in the middle of all these

complex, highly leveraged, exotic trades he created without

necessarily understanding all the implications of those

monstrosities.

Well, that seems, to me, very chilling--the fact that somebody would admit they didn't even know the products they were selling to consumers--who assumed not only that they knew but also that they would not be deliberately misleading them. That is an example. The example doesn't stop on Wall Street. It extends out to Main Street, to people with credit arrangements, payday lenders, organizations charging huge interest charges, and it is designed to exploit consumers.

The Republican proposal does little, if anything, to prevent that. I hope, on a bipartisan basis, as Senator Schumer suggested, we reject this amendment. It is, as they say in some places, all hat and no cattle. We have an agency, but we have no enforcement powers. We have an agency, but they can't enforce their rules and regulations on certain sectors; i.e., most of the sectors. So if we want to protect consumers and if we want to have efficient markets--I think one of the inaccurate premises that some people are suggesting is that consumer protection somehow is bad for business. I argue strenuously that consumer protection is very good for business.

If you take care of the consumer, if they feel, and you provide, valued and good service--that used to be the American sort of maxim. That used to be the American byword for business: the consumer is always right; the consumer comes first.

In the Republican legislation, the consumer comes last, not first. The consumer should come first. I hope this amendment will be rejected and that we support not only the underlying Dodd bill, but I think it can be improved. I commend the Senator from Connecticut who has done a remarkable job crafting the consumer protection agency. To accept the Republican amendment would be to turn our backs on consumers and reject essentially the old American maxim that the consumer is always right and the consumer comes first, and it will leave everybody in this country where we are today: buyer beware of the monstrosities in the marketplace.

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

Mr. President, yesterday we and the nation heard from Goldman Sachs executives indicating they had no regrets about the financial crisis, a crisis that has left 8.5 million people without jobs and stripped billions of dollars of retirement savings from working Americans. In fact, the Pew Institute released a study that indicates the financial crisis and recession have already cost U.S. households $100,000, on average, in lost wealth and income. That is a huge blow to the families who are struggling to pay for their retirement, to pay for their children's education, and provide a better life for themselves and their children.

We have seen, in the last five quarters, because of this financial crisis associated with and connected with the recession, $648 billion less in gross domestic product than was projected initially--$648 billion of productive enterprises. The cost of this crisis is something we all should not only recognize but commit to preventing in the future. We also should calculate the cost not just in terms of gross domestic product and how well executives on Wall Street are doing, who are doing pretty well, but how well the average family in this country is doing, and how well they will do in the future. We must consider how much in terms of their wealth has been diminished, if not lost, in rebuilding our economy.

One of the major functions of any financial sector in any part of the world is to efficiently allocate capital to grow domestic product--not to reduce it--to invest in productive enterprise and employ people. The financial sector shouldn't undercut companies or force them to lay off workers. All of this, in the last few months, I think has represented a failure in that basic function of making sure capital is accumulated and then efficiently allocated to productive means.

So Wall Street, I think, has a lot to regret about their role, and we have a lot to do to improve the situation, to ensure the regulatory structure is in place, and to set clear rules for the conduct of financial business that will protect families, protect consumers, and protect the taxpayers.

This is the third time our colleagues on the other side have blocked such efforts to begin the discussion. We recognize this is a complex topic, with many different parts: credit rating agencies, capital requirements, financial institutions, derivatives. You can go on and on and on. So anyone who implies they have all the wisdom, I think, will find themselves sadly mistaken. But we have to get on with this bill because unless we bring the bill to the floor, we cannot begin to, in the open, talk about those policy issues that people can disagree on-- people have different approaches--and ultimately resolve this and create a better regulatory structure and a stronger foundation for our economy.

But in the last several days, this has been, again, ``say no and the problem might go away.'' Well, if they continue to say no, the problem will get worse. We are looking across the globe today at a crisis in Europe because of Greek sovereign debt. It is spiraling. Already, Spanish debt has been downgraded. If we think we are immune from these global currents, both good and bad, we are mistaken. If we do not put in a stronger structure of regulation, the next crisis might not be starting on Wall Street, but the impact on Main Street could be the same, and it could be just as devastating.

We have to look forward. We have to move on. The notion that we have all the time in the world and we can sort of nonchalantly go about our business--or in some cases, if it is a political judgment that it is better to resist--is not serving the people of this Nation well.

We recognize there are principle differences. Let's resolve them, as we do on the floor through debate, through discussion, and through a vote, and let's move on. We have a lot of work to do. The underlying bill Senator Dodd has brought to the floor already incorporates so many of these disparate views, and I think in a very sensible way.

Let me, for the record, recall that legislation like this has been pending for months and months and months. The Presiding Officer will recall--because he participated with me in the first markup last November--Senator Dodd brought a bill to the committee, opened it up to amendment, and it was quite clear there was going to be no serious discussion. In fact, our colleagues on the other side said: We need more time. We want to participate with you. I think it was done with great sincerity. Senator Dodd entertained those proposals for months. From November until a few weeks ago, we were working collaboratively and creatively to try to bridge our gaps and bring a bill to the floor.

Well, finally--and somewhat in exacerbation--Senator Dodd concluded this was leading nowhere, except to more delay, if not denial of the great problem we face. So we had a committee markup. Again, it was an opportunity for our colleagues on the other side to bring forth their proposals, their ideas, in a markup in which we would be able to consider their views, vote on them, and then move that bill to the floor. But it was a perfunctory session. They had concluded that, no, they were not quite yet ready to offer their proposals, their ideas, and to engage in the business of legislation.

So now the bill is before us, months after we started this process, months after we have entertained and incorporated proposals that have been made by our colleagues because they are very good proposals. It was Senator Corker and Senator Warner--who have done an outstanding job--who structured the whole issue of resolution, that there would be an upfront fund so that financial institutions--not taxpayers--would pay for the failure of a financial institution.

Yet when that bill was brought to the floor--or we attempted to do it--that provision, that bipartisan provision was singled out for, shall we say, criticism, if not ridicule, as a perpetual bailout bill. That was a misrepresentation of the bill and it, frankly, contradicted the whole effort, the whole bipartisan effort to come up with something that both sides could support.

But this bill incorporates so many different ideas and aspects that have been shared. In fact, it was interesting, in the lead up to this floor consideration, so many times on both sides of the aisle, people would say, routinely: well, we agree on 80 percent of the bill. I think if you have 80 percent of the bill agreed to, at least conceptually, you are probably ready to bring the bill up for debate and to vote. Yet again, the Republican side refuses to do that.

They are, I think, assuming, I guess, they have a lot of time. But as you look around the globe, at the crises in Europe, at the stock market falling dramatically yesterday because of Europe, I think we have to move aggressively to protect American families, and that means getting the bill on the floor and voting for it.

This bill will make changes that are urgently necessary. Again, the issue of too big to fail--through the extraordinary effort, painstaking effort, the hours of discussions by Senator Warner and Senator Corker, there was a proposal for resolution that effectively ends too big to fail. In fact, Sheila Bair, who is the Chairwoman of the FDIC and was appointed by President Bush, says it virtually eliminates the possibility of a taxpayer bailout. So that is part of it. Strengthening consumer protection. There has been, I think, an unfortunate generalization that consumer protections are bad for business. Frankly, we should have discovered in the last several months that good consumer protections are very good for business. Many of those consumer laws-- which would have protected people seeking mortgages--which were ignored or exempted would have, I think, improved dramatically the mortgage situation. It would have improved business. It would have made that overriding issue of efficient allocation of capital much easier.

But when you have very little protections for consumers, they are at the mercy of people who will exploit them for a quick buck. And that is what happened. Mortgages were given to people who were not qualified. Why? Because no one was watching out for them. But not only that, the individual issuing the mortgage did not have, as they say, any skin in the game because they simply sent it in to the big securitization process. Someone got a fee for securitizing it. Someone wrapped it up into a big mortgage-backed security. Someone else wrapped it up into a collateralized debt obligation, which is a collection of securities. Then someone else wrapped that up into a synthetic collateralized debt obligation and sold it off. Not a lot of efficient allocation of capital for productive means, but a lot of fees for investment bankers, securitizers, and mortgage brokers. At the very beginning, good consumer protections would have been an effective way to mitigate some of that damage. They are in this bill.

We are attempting to eliminate huge gaps and loopholes in financial regulation. Our regulatory scheme has grown up over many years, in fact, through the life of this country. So we have a national bank authority that was created in the 1860s. We have an Office of Thrift Supervision that was created many years later because of thrift institutions. We have the FDIC, which was created in the 1930s by Franklin Roosevelt as a result of the Depression and the need to insure deposits. We have the Federal Reserve System that monitors local banks and large banks that was created in the Wilson administration.

All of them have a little different piece of the action, and all of them have been routinely used in what is termed regulatory arbitrage, to move to the most favorable position for your business, which may not be favorable to the overall economy. Some of the big mortgage lenders that ultimately collapsed started off being regulated by the Office of the Comptroller of the Currency, and then they decided they would have a better deal at OTS. Frankly, if they had an opportunity--if they were still with us--they would be looking elsewhere. Hit and run, I think, was probably the business plan. We have to stop that.

This bill takes a strong step forward, consolidating that supervision, by consolidating the Office of the Comptroller of the Currency and the Office of Thrift Supervision, by limiting the supervision of the Federal Reserve over a countless number of small banks, and concentrating their efforts at the big institutions, where their expertise and their focus should make a difference.

This is a huge improvement over what the present system is. Yet our colleagues are not recognizing the need to improve and the need to move forward. We have been engaged, through Senator Lincoln and Senator Dodd, with derivatives legislation, which, for the first time, recognizes and regulates those derivatives. There was a great debate here in the 1990s, and through that debate derivatives were left unregulated. Today we have to recognize we have to put them back under regulatory supervision.

The legislation creates the steps, the architecture, which will go a long way to prevent some of the problems we have seen. It requires reporting all derivative transactions to a data repository which the regulators will have access to so they can see firsthand in real time what is happening out there. Is there a big buildup in Greek debt? Are there huge positions in credit default swaps on Greek bonds? They can quickly get a macro sense of what is happening.

Then, with limited exceptions, all derivatives have to be cleared on a clearing platform. That takes away the bilateral nature of transactions. Someone says: I will sell you insurance on this interest rate for a fee. You give me the fee, et cetera. That is bilateral. If one of these parties is unable to carry out its obligations, the transaction fails. In a clearing platform, there is a central party that assumes the risk of one of the parties failing. It is a mutualization, really, of risk, and it is a step forward.

But we have to step even farther than that. We have to push as many of these trades onto a trading platform, not just clearing it and holding collateral, but actually pricing it. Because of the complexity of some of these products, unless there is a market, no one knows the real value. On a trading platform, there is a market value and people can value it because basically if someone will buy it, that is the value. So we have to do that. This legislation goes a long way to doing that.

With respect to credit rating agencies, one of the great failures is the credit rating agencies. As to all of these exotic mortgage products that collapsed in value, most of them were rated investment grade--AA, AAA, according to whatever the rating is--and yet they failed. Part of it was because of the way credit rating agencies operate.

Senator Levin conducted recently some very good hearings on this issue. The familiarity between the investment bank that is bringing the product to the street and the raters, the interconnectedness, the failure to have the appropriate checks on the models that raters were using, an independent risk analysis within the rating agency that is going to look at these models not for the benefit of who is paying for it but for the propriety and correctness of the model. That is in the legislation.

We have done something else too: We have inserted language that would allow someone who has invested their savings through a pension plan or other method to go to court and make the case that they should find out what happened within the rating agency with respect to the poorly rated investment that caused them to lose their savings. Today, these cases are routinely dismissed before anyone can question the rating agency. Our legislation would allow them to get beyond the pleadings stage. But it would also give the rating agencies an affirmative defense. They would have to factually check their models. They would have to actually look at some of these mortgages. Frankly, this might be 20/20 hindsight, but if someone drove out to one of those counties in Florida where there were all of these exotic mortgages but no one seemed to be living there and the communities were deteriorating, I think they would pretty quickly check their rating. That appears not to have been done.

For the first time, hedge funds are regulated. They would have to register with the SEC and be subject to registration, notifying the SEC of the size of their pool and other basic information.

Well, we have had months of opportunities to share additional thoughts and work together to amend the bill in committee, which was not done, but, more importantly, to begin today--in fact, we should have begun last week--this issue of finally passing a Senate bill that responds to the crisis we saw; that builds a stronger foundation of financial expansion; that protects consumers and taxpayers as well as leads to the increase in the wealth of families, not to the dramatic decrease and decline we have witnessed because of some of these forces at work today in the marketplace on Wall Street, which still have to be addressed.

There will be parts of the proposals that come up that will be an attempt to weaken some of these provisions, particularly with respect to consumer protection. Again, I think it flows from the false logic that if it is good for consumers, it is bad for business. Actually, I always thought, in smalltown business, the customer is always right. You believed the customer, made sure you provided value for your product, and made sure he or she would come back because they were happy and satisfied. Apparently, that old-fashioned rule has been tossed out, but I think that old-fashioned rule has to be reestablished.

We have seen, as a way to deflect attention from the need to reform and the need to move this legislation, misrepresentations about the bill. I mentioned one: It is a bailout bill. Well, I think that has been dropped because it was transparently misleading. Indeed, this bailout mechanism was a bipartisan product of two of our distinguished colleagues, Senator Warner and Senator Corker. Now we are at the old standby: It is going to hurt business. I will tell my colleagues what has hurt business, and that is the behavior on Wall Street.

I can recall that several years ago there was a study by the McKinsey Company that said that if we did not loosen further the already, I think, lax rules, we would lose all the securities business; all of Wall Street would go to England or other places; we would lose thousands of jobs. Guess what. They have lost, unfortunately, thousands of jobs there. And it wasn't because regulation was too stringent; it was because it was too lax.

Again, if there is any case to be made for what hurts business, it is irrational allocation of capital; lax rules with respect to consumers; a market driven not by value but by compensation, not by long-term growth but by short-term profit. That is what has cost every family in America $100,000.

So if we move purposely and with the input of our colleagues, which we have already accepted, we can establish a framework where business will begin to grow again. So I reject the argument that what we are doing will hurt business. In fact, I think this uncertainty of whether we will have this reform or that reform continues to, at least to a degree, impede capital formation and to impede investments in the country. When there are clear rules of the road, then the economy will again begin to pick up, as it is beginning to pick up for other reasons.

If we don't take up this bill, work on it, and pass good legislation, who wins? Well, I will tell my colleagues who wins. It is the big banks that have survived this crisis today, that are reporting record profits. What are they making their money on? Giving loans to small business men and women across America? Investing in municipalities? No. They are making huge profits in trading--betting, in some respects, on how the economy is going to do. Well, we need a situation in which capital is dedicated to growth and to investment and productivity.

The speculators will continue to reap billions of dollars of profits. I am sure there are several clever people who are doing quite well over the demise of sovereign wealth in Greece, who have taken short positions on Greek bonds and are making a lot of money. That is not helping us, it is not helping the country, and indeed it is not helping our trading partners across the globe. That, unchecked, will continue.

The opaque and unregulated market that I just referred to in derivatives, a $600 trillion notional market. When you talk to people about clearing of derivatives, it is not billions, no; it is trillions of dollars. That market is unregulated, and if it goes the wrong way quickly, the consequences can be devastating. We have seen that with the mortgage crisis.

So we have to move. We have to move at every level, not just the big banks, but we have to provide appropriate regulation for people in terms of the mortgage industry so those abuses in mortgages will be corrected. We have to go ahead and look at payday lenders who are charging 900 percent interest, who are stripping people of their hard- won resources. We have to look at the credit card companies. We have passed legislation, but we have to look at what they are doing. If those people--the payday lenders and the mortgage brokers--can continue to operate with impunity, the bankers win. Who loses? Well, consumers lose--paying the excessive rates, seeing their homes devalued, all of that.

I think we have to stand up and start the work of legislating. The status quo is no longer affordable, and I think the notion that we will never see another crisis is undercut by looking around. If there are not today some steady hands at the tiller in Europe in terms of the European community and their financial arrangements, the cascading effect of Greece to Spain to Ireland, et cetera, could be another problem we have to deal with.

We have lots of work to do, and the longer we delay, the more we are neglecting the real needs of our constituents. I urge that on the next vote we get down to business.

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

Mr. President, the recent lawsuit by the Securities and Exchange Commission, SEC, against Goldman Sachs underscores that much still needs to be done to improve transparency and restore confidence in our financial system. Indeed, that is why we must have the debate on Wall Street reform. The nearly \1/2\ of all U.S. households that own securities deserve a strong cop on the beat that has the tools it needs to go after swindlers and scam artists, and pursue the difficult cases arising from our increasingly complex financial markets. Our economy's success depends in no small part on restoring confidence in our capital markets and a smoothly operating capital formation process.

The bill I am introducing this afternoon, the Modernizing and Strengthening Investor Protection Act, would improve the ability of the SEC to protect investors by strengthening its ability to bring enforcement actions, addressing issues revealed by the recent Madoff fraud, and modernizing its ability to obtain critical information. In particular, it would enhance the ability of the SEC to hire market experts, strengthen oversight of fund custodians, modernize the SEC's ability to obtain information from the firms it oversees, and clarify and enhance SEC penalties and other authorities.

This legislation mirrors a bill that Representative Kanjorski introduced and worked to include in the House version of Wall Street reform. I urge my colleagues to take a look at my legislation during the next few days, as I plan to introduce it as an amendment to the Wall Street reform bill that is about to be considered by the Senate.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, the recent lawsuit by the Securities and Exchange Commission, SEC, against Goldman Sachs underscores that much still needs to be done to improve transparency and restore confidence in our financial system. Indeed, that is why we must have the debate on Wall Street reform. The nearly \1/2\ of all U.S. households that own securities deserve a strong cop on the beat that has the tools it needs to go after swindlers and scam artists, and pursue the difficult cases arising from our increasingly complex financial markets. Our economy's success depends in no small part on restoring confidence in our capital markets and a smoothly operating capital formation process.

The bill I am introducing this afternoon, the Modernizing and Strengthening Investor Protection Act, would improve the ability of the SEC to protect investors by strengthening its ability to bring enforcement actions, addressing issues revealed by the recent Madoff fraud, and modernizing its ability to obtain critical information. In particular, it would enhance the ability of the SEC to hire market experts, strengthen oversight of fund custodians, modernize the SEC's ability to obtain information from the firms it oversees, and clarify and enhance SEC penalties and other authorities.

This legislation mirrors a bill that Representative Kanjorski introduced and worked to include in the House version of Wall Street reform. I urge my colleagues to take a look at my legislation during the next few days, as I plan to introduce it as an amendment to the Wall Street reform bill that is about to be considered by the Senate.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

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

Mr. President, last month, my State was hit by the worst nonhurricane floods in the history of the State, at least in the last 200 years.

Our Governor has preliminarily assessed the damage in the hundreds of millions of dollars, which is a significant figure for the smallest State in the Union. This disaster came at the worst moment for my state. Rhode Island is struggling with an economic collapse that has left it with a 12.7-percent unemployment rate and decimated State and local financial resources.

Indeed, many of the homeowners and businesses who were hit hardest by the floods were among those already struggling to make ends meet. I toured the State, along with my colleague, Sheldon Whitehouse, and met with constituents from Cumberland to Westerly, from the north to the south, as they worked to clean their homes and businesses. We could see the turmoil, as well as their physical and emotional strain and stress. They are tired. They are frustrated, and they are asking for our help. I admire the spirit of people who are willing to pitch in and help their neighbors, and that was evident throughout the crisis. This significant blow came on top of the economic blows we have already suffered. A flood like this is difficult in good times and it is truly trying in bad times, as we have seen in Rhode Island.

I wish to commend FEMA and all the professionals in emergency management who have come to Rhode Island for their help in the recovery. They are doing a marvelous job. The speed of the response, including from Secretary Napolitano, has been tremendous. She was up there on Good Friday looking at the flood damage. The FEMA teams were on the ground. Deputy FEMA Administrator Rich Serino was there. He visited the damage with me. This is emblematic of the commitment of the FEMA task force. It is not only FEMA. It is also the Small Business Administration. The regional EPA director was there, the regional small business administrator was there. We had representatives from the Army Corps of Engineers and the district engineer.

The most emblematic story was told to me in Washington by a Rhode Islander who was visiting. She was a visiting nurse. She said her sister was at home on Easter. She had some flood damage. The doorbell rang, and it was FEMA. They said: We work 7 days a week. Here is the estimate of the damages, and we will be able to help you in this way.

Even with this dramatic and effective response, the damage was widespread. It covered every corner of the State. This was the first time we have seen, in my lifetime and going back a long time, not only surface water coming over the banks of rivers--there are some areas that perennially flood, similar to anywhere in the country--this was groundwater. We had been so saturated with rain for weeks and weeks. When the final deluge came, there was no place to hold the water. It came up through cellars, through sump pumps, through everything. There were very few parts of the State, very few homes unaffected by at least minor basement flooding; in some cases, very major water damage.

The story of the Pawtuxet River is an example of what transpired. Let me also say that in my course of traveling around, I was reeducated in the development of northern industrial communities. I am looking at the Senator from New Hampshire. The development started with a mill on a stream for water power. Then they built mill cottages around that. Those mills are still there. Those cottages are generally occupied today by relatively low- or moderate-income people. The mill owner, I recall now, put his house on the top of the hill, not around the mill. So that is Rhode Island. That is Massachusetts. That is Connecticut. That is New Hampshire. When these waters flood, you perennially get some communities that see damage from surface water. This is the first time we saw this incredible groundwater as well.

We are a community of rivers and mill villages. The Blackstone River is where the American Industrial Revolution began, the Pawtuxet River in Cranston, the Pawcatuck River, the Pocasset River in Johnston and Cranston--they all were above flood stage. The Pawtuxet River, in my hometown of Cranston, on March 15, crested at a record high of 15 feet. Remarkable. Neighborhoods along the banks flooded as homes and businesses were evacuated. I toured those neighborhoods later in the week and saw the damage. Again, along with Senator Whitehouse, I worked to support a major disaster declaration which was promptly granted. The people of Rhode Island appreciate President Obama very quickly supporting a major disaster declaration, not only for individuals but also for public entities, the cities and towns. This is something he did with great speed and great efficiency. I thank him personally.

Actually, the initial flooding was around March 12 or 13. Then we got the second deluge. It was a two-stage event. As the rains were falling, one woman profiled on local television looked in exhaustion at the new furnace she just installed. In anticipation of the second flood, there was an attempt to move vehicles, furnaces, et cetera around, to shore up or raise equipment on factory floors. But the rapidity and extent of the rain was such that the flood was there before many people could react.

Let me try and give a sense of the damage. This horizontal axis runs south-north under the overpass. This is Route 95, the principal interstate running along the east coast. It was shut down for two days because of flooding. The road was completely inundated with water, completely covered. Then, in the next picture, this is the city of Warwick's wastewater plant, totally engulfed in water. In addition to that, the city of Warwick is also home to our airport. So for 2 days, when you got off a plane, you saw a sign that asked you to respectfully use restrooms someplace else or the Porta-John because the airport could not use their toilets. The whole city asked their citizens to suspend flushing for 2 days. So this impact is something we have never witnessed before. The next photograph is the Warwick Mall, one of the major shopping centers in the State of Rhode Island. It is totally engulfed in water and the inside is flooded. These are stores and retail establishments. They are still trying to reopen it. This facility employs about 1,000 people. They are still out of work. When you a have 12.7-unemployment rate and 1,000 people can't work because they have been flooded, that is adding excruciating pain to something that is already difficult. I must commend the owner of the mall, Aram Garabedian. Aram is indefatigable. Nothing is going to defeat him. Immediately, he was in here cleaning up. It is on the road to recovery and return, but this has been a blow economically to the State. As I said, in Rhode Island, because of our small size and community, there are five or six principal malls. Essentially, 20 percent of our mall sector is out of business.

The next photograph is typical of the property damage. This is in my hometown of Cranston. Notice the sign: ``Give this land back to the river.''

The river decided for a moment to reclaim it. This is the result of the surface flooding and the subsurface water coming up. This looks like the entire inside of the home has been destroyed and removed. Here is a hot water heater, a toilet. Although the house is standing, what is inside is basically a shell. This is a homeowner who now has to rebuild their house, essentially, and replace water heaters, toilets. One of the issues we have is that in some of these areas, because of the subsurface flooding, they are not a flood zone. Unless they have recently borrowed money on a mortgage, there is probably little requirement for them to have flood insurance. Typically, in these communities, the houses have been occupied for 20, 30, 40 years by one family. They have either paid off the mortgage or they don't require flood insurance. So many people, frankly, don't have flood insurance. Then, of course, there is going to be wrangling with the insurance companies because, in some cases, where it was just subsurface water, that does not fit their definition of a flood. So depending on your policy, or if you have coverage, there are thousands of homes in Rhode Island that are significantly damaged. The owner has no resources to rebuild unless he gets some assistance. Again, FEMA has been very good for temporary assistance, but we have to look more long term.

Finally, this is Hopkinton, RI, which is part of our rural area in the west. This photo shows the scope of the flooding there. This structure is totally surrounded by water. I was in other parts of this area, in another community, Charlestown. There was a bridge that was closed. As you walked across the bridge on the other side, because of the water moving under the ground, it looked as if someone had dropped a 500-pound bomb. It was a huge crater. Now the town has to rebuild the bridge. Of course, they don't have the money to do so.

All this is indicative of the situation in Rhode Island. A further point. This photograph was taken a week after the flooding. Notice it is sunny. This is a week after the flooding. These owners couldn't even get to their building after a week. This could have been worse in this particular locale because farther upstream there is a dam, the Alton dam. It was overtopped and the waters were going over it. There was so much concern that it was in danger of collapsing that there was an emergency evacuation order for the town of Westerly, which is a sizable community to the south on the coast. They were afraid the dam would give and a major metropolitan area, in Rhode Island terms, would be engulfed with water. Luckily the dam held, and the damage was significant but restricted to flooding along the Pawcatuck.

Within the context of jobs, too, several of our facilities and factories were knocked out. Bradford Printing and Finishing has already let go of its employees. They were underwater. They are still trying to literally get back to work. It has been closed for cleanup. Again, workers are on the street, not because they don't have demand for their product. It is because they can't get to the machines where they are flooded. Another company in northern Rhode Island, along the Blackstone River, Hope Global, an extraordinary CEO Cheryl Merchant, they were flooded in 20005. I was there. I had to take a boat into their factory. This time, in anticipation, they literally lifted the equipment. This is a major producer of OEM for the auto industry, webbing and belts, seatbelts, et cetera. They pushed up all that heavy equipment. The water came in, but it didn't reach the equipment. They are back in production, but the preparations and the cleanup are about $1 million. It is hard for the manager of the plant to explain to the board of directors why they are going to spend $1 million every 5 years just to keep the equipment dry.

We have to do something in terms of mitigation. Even in the best times, FEMA would have been necessary. But we are in a very difficult situation. The State is, as we speak, trying to fill a $220 million shortfall in this year's budget. Again, this is a State where $220 million is a significant part of the budget. It is not a rounding error. They are already anticipating a $400 million shortfall next year in the 2011 budget. The bond rating has been lowered once in the last several weeks. It may be lowered again, if this economic distress and this flood damage can't be, in some way, mitigated and supported in terms of cleanup or reconstruction.

Frankly, my constituents know--and we all have seen similar scenes of flooding from the Midwest, from the Southwest, from the Central part of America--every time, at least in my recollection, this Senate has stood and provided support for those communities.

I have supported emergency expenditures for flooding in communities elsewhere in the country, except really up in Rhode Island because we have never had an experience before of this nature, of this size, of this scope. They, frankly, do not begrudge the aid because, as I sense and as my colleagues and constituents sense, someday we might be in that position where we are going to have to ask for it. Well, we are in that position right now. So for everyone who has been here--and it is a significant number--and asked on behalf of their constituents for help because of a devastating flood, I am joining those ranks. We will have an opportunity, I hope, in the appropriations process through the supplementals to provide additional assistance to the State of Rhode Island, for my constituents to deal with this situation, both the economic distress and the physical damage from this flooding.

So, Madam President, I again thank you for the opportunity to talk about what happened, and I will be back again because, as we have responded to the needs of other parts of the country, we ask that we be given the same treatment.

I yield the floor.

I suggest the absence of a quorum.

Mr. President, first, let me join Majority Leader Reid in saluting these incredible Americans who are with us today, wounded warriors and Bob O'Malley. As someone who served 12 years in the U.S. Army, my appreciation is profound for what you have done and continue to do. Thank you very much.

I have a circuitous connection with the 10th Mountain Division. My classmate, Buster Hagenbeck, commanded the 10th Mountain Division in Afghanistan, and I was there to visit those great soldiers several times. Thank you for your service and thank you for your inspiration.

Mr. President, I am here today not only to salute these great Americans but also to talk about the urgency of bringing the issue of Wall Street reform to the Senate for open debate and final passage. We have weathered and witnessed the worst financial crisis in the history of the country. We have seen wealth, trillions of dollars of wealth, evaporate because of this financial crisis. To hear people now talking about, well, this is not a good bill--the question is not whether we should delay further or go forward. The question is going forward with purpose, amending the bill on the floor, if necessary, in an open and transparent way so the American public can see we are moving forward on perhaps their No. 1 priority related to the economy, and economic recovery and financial reform are integrated key elements. We cannot have long-run economic success without fundamental financial reform.

We are here today essentially to urge that the anticipated vote on Monday to proceed to the bill be affirmed overwhelmingly to send a message to the American people we are on the job for them, we are doing the work we have to do. We have to deal with a complex and significant legislative measure--but we have to do it now. The time for discussion, the time for consideration privately, has passed. Now we have to act.

I think we have to act because we should recognize the status quo is unacceptable. Those on the other side who have been saying: Not now, not now, not now, essentially are defending the status quo. We have to ask several questions. Who does the status quo favor? It favors the remaining big banks and other financial institutions. We have seen, over the last several days, that these banks are reporting record profits, mostly based on trading. Here is another irony. Because of the system we have today, we are in desperate need of economic activity at the local level, the infusion of capital, lending--all those things. Where are the banks making their huge profits? On trading, essentially taking their money and other people's money and not investing in new productive capacity, but betting on financial products. That is not, in my view, what we should be doing at this moment. We have to recognize that if we do nothing, the banks will continue to operate as they have.

That, I think, has to be corrected. The second question is, what activities are protected by the status quo? I will tell you. Exotic derivative trading. We saw this week where the Securities and Exchange Commission has made allegations against Goldman Sachs. Now, that will be determined in a court of law.

However, the complexity of the transaction engaged in by Goldman and others, the creation of a synthetic collateralized debt obligation, to translate, was essentially picking out some representative mortgage funds and then betting on them. Somebody took the side that said they would still pay; some would take the side that they would default.

What did that add to our economic capacity? In fact, one of the ironies of this whole crisis is there was such a proliferation of these toxic mortgage bonds that they no longer could sell them at a profit, so they started essentially creating virtual or synthetic securities.

Again, what has it added to the economic productivity of the United States? Not much. In fact, some would argue nothing at all. We have to have a financial sector which performs one of the essential functions of any financial sector, the allocation of capital to productive uses: highways, buildings, education support, all of those things that not only return a profit to the investors but also build up our economic capacity and build up our wealth over the long term.

Other activities that will be protected by the status quo include not only derivatives trading, but dark pools of capital, huge private equity funds that are shadowy in terms of their investment strategy, even to regulators, and the credit rating agencies. They are continuing to operate, and, frankly, we have to say their performance in the last several years was disappointing, and that is being very diplomatic. But they will continue to operate as they have in the past because we will not get the reform that is so necessary.

Of course, the Wall Street salary structure, the incentive compensation, also will continue to be unaffected. So for all of these activities, if you are comfortable with them, then vote against the motion to proceed on Monday evening. If you are uncomfortable with them, if you do not want to see the remaining banks continue to operate as they have, then you have to vote, in my view, to move forward to debate this bill and engage on this issue.

Now, the third question we have to ask is, what does the status quo do for consumers and taxpayers? The answer is very little, if anything at all. We saw in this whole situation consumers who were in some cases misled. In some cases it was obvious they could not afford the credit arrangement they were signing on to, but the incentive on the other side was not to look behind the veneer of the borrower but simply to get the loan closed and then sell it off for securitization profits.

We have to change those incentives, and if we do not proceed to this legislation, we do not have a chance of doing that. So we have to move forward. Some have claimed, the Republican leader and others, that this is just a partisan exercise. It has not been a partisan exercise. We have been, under the leadership of Chairman Dodd, engaged in this effort for months and months and months.

Some people might have forgotten around here, but we started the markup of the financial reform bill November 19 of last year. We had a bill. Senator Dodd brought it to the committee. We started opening statements, and then everyone said: We have not had time enough to do this. We want more discussion.

Senator Dodd, even with the urgency of moving on this measure, said: Fine. I respect my colleagues. I respect the process. We will stop. We will start talking.

Well, the negotiations went on and on and on. It was clear there was no sense of urgency on the other side to move to a decisive vote. Then he engaged other Members. Senator Corker and others entered the discussion. I have been discussing derivatives in a very thoughtful way with Senator Gregg for months. But we have reached the point now where we have to take deliberate action and make some decisions.

We have to move to the floor, to debate and votes and final passage. This is something we have to continue to move forward. The way to move forward is to vote on the motion to proceed on Monday evening.

We have heard claims that this is a bailout bill, which I think would be a huge shock to many of my colleagues on the committee who have been working on this for months and months, Senator Corker and Senator Warner particularly, who crafted many of the provisions in this area.

The reality is, if we do nothing, which is the effect of voting against the cloture motion--if we do nothing, we could have a crisis next week. Greek sovereign debt--there is huge turmoil in Europe about Greek bonds, the ability of the Greek Government to pay, the need for support. If those talks collapse and suddenly throughout the financial system there is a rush away from sovereign debt, not just Greek debt but other countries, what will happen? We do not quite know, I suspect, who is holding all of this debt and what are the systemic effects. We have to be prepared for something like that.

The notion that this crisis has passed and we can go about our merry way without dealing with these issues is naive. The way to deal with it is to establish a resolution mechanism. Senator Warner and Senator Corker have done a remarkable job of crafting one. One of the questions they struggled with the most is who is going to pay for the resolution.

Frankly, they stepped up to the plate today and said: Let's put the banks on the line for the first $50 billion. That makes sense to me because it is clear who is going to pay: not the taxpayer but the banks. But, in any case, we cannot engage in this discussion of the mechanism and how it will finally come out until we bring the bill to the floor, debate it, and vote upon amendments or changes. That is what we have to do. But this legislation is clearly not a bailout for the banks. If it was, they would be supporting it.

Frankly, all the newspapers I read suggest the intense lobbying effort against the bill is by the banks, which, coincidentally, seems to favor the position of those who do not want to proceed to the bill. So I think we are in a situation where we have to proceed forward. As I said, if we do not move forward, we are going to have a significant issue of confidence by the American people and others in the stability of our financial system. These are complex, intricate issues. They require debate and discussion. I do not think anyone should be presumptuous enough to stand here and say: We know exactly what to do, and we are going to do it without the consent and without the input of all of our colleagues. But that consent and input comes, ultimately, on the Senate floor through debate, discussion, and voting.

Now, again, where are we if we do not take up this measure next week? Well, the $600 trillion market in derivatives will remain opaque, complex, confusing, and a potential vulnerability for our financial system. I say $600 trillion because when we talk about derivatives markets, billions are--you know, that is a rounding error. It is trillions of dollars, and a miscalculation, a mistake, a misjudgment in that market has huge consequences.

The big banks who sell complex, toxic instruments to pension plans, essentially taking savings and trading them, gambling with them, in some respects, they will continue to do that. They will not only take pension savings, but they will take municipalities' money in fancy bond arrangements that the municipalities never needed.

All of these things will continue.

Unregulated mortgage lenders will continue to go out and operate under the originate-and-sell model, which has led to so many problems. Payday lenders that are charging, in some cases, 900 percent interest will continue to be unregulated. Credit card companies, even after our efforts with the credit card legislation, will continue to try to circumvent the rules to maximize their profit.

The bottom line is, the people who benefit from delay, from taking the course of action of delay and denial, I would say, because this urge to suggest this is a bailout bill is denying the facts of the bill, will be financial institutions and not consumers and not taxpayers.

So, as a result, I would urge all of my colleagues on Monday to vote to proceed to this bill. Again, we have to ask three questions. This will be decided on Monday evening. The status quo favors the banks. If you want to favor the banks, then vote against cloture. The status quo operates to allow all sorts of arcane and exotic activities which we know have posed significant threats to our financial system.

If you want these activities to continue unimproved, uncorrected, vote against cloture. The status quo disfavors consumers and taxpayers. So if you want to see them continue to be on the short side of the sale, vote against cloture. I would urge we vote for cloture, we move forward to debate real ideas about how to improve our financial system, protect consumers, and strengthen our economy.

I yield the floor.

Mr. President, today I introduce with Senator LeMieux and Senator Brown of Ohio, the Teacher and Principal Improvement Act, to foster the development of highly skilled and effective educators.

We are slated to reauthorize the Elementary and Secondary Education Act--ESEA--this Congress for the first time since 2001. My top priority for reauthorization is to build the capacity of our Nation's schools to enhance the effectiveness of teachers, principals, school librarians, and school leaders.

Decades of research have demonstrated that improving teacher and principal quality as well as greater family involvement are the keys to raising student achievement and turning around struggling schools. Studies have found that more than 50 percentile points of the difference in student academic performance is attributed to teacher quality. The world's top performing education systems invest heavily in supporting and developing teachers. Teachers in top-ranking countries such as Finland and Singapore get 100 hours of fully paid professional development training each year. It is clear that the United States must also increase its investments in our educators to stay academically competitive in an ever-expanding global economy.

Unfortunately, every year across the country thousands of effective teachers leave the profession--many within their first years of teaching. A 2003 study by Richard Ingersoll found that one-third of all new teachers quit after three years. That turnover rate increases to nearly half--one out of every two new teachers hired--after 5 years. A report by the National Commission on Teaching and America's Future also estimated that the nationwide cost of replacing public school teachers who have dropped out of the profession is $7.3 billion annually.

However, research has shown that comprehensive mentoring and induction reduces teacher attrition by as much as half. New teachers need extra support and guidance. As such, our bill would help schools implement the key elements of effective multi-year mentoring and induction for beginning teachers, including rigorous mentor selection; ongoing mentoring with paid release time; training for mentors; and the use of research-based teaching

practices such as the National Board for Professional Teaching Standards.

The bill also significantly revises ESEA's current definition of ``professional development'' to foster an ongoing culture of teacher, principal, school librarian, and staff collaboration throughout schools. All too often current professional development still consists of isolated, check-the-box activities instead of helping educators engage in sustained professional learning that is regularly evaluated for its impact on classroom practice and student achievement. Effective professional development is collaborative, job-embedded, and data- driven. Research has shown that this type of professional development has a positive impact on student learning.

Research has also increasingly emphasized the important role that effective evaluation systems can play in teacher and principal development. Unfortunately, most evaluation systems nationwide have significant flaws, including a lack of: clear standards of expected performance; meaningful differentiation of teacher performance; ongoing evaluations and classroom observations; and rigorous training of evaluators. As such, our Teacher and Principal Improvement Act would for the first time in federal law require school districts to establish rigorous, fair, and transparent evaluation systems to assess whether teachers and principals are having positive impacts on student learning. If evaluation is done right, it provides teachers and principals with individualized ongoing feedback and support on their strengths, weaknesses, and areas in need of improvement.

Principals and school leaders also have a critical role to play in leading school improvement efforts and managing a collaborative culture of ongoing professional learning and development. Research has shown that leadership is second only to classroom instruction among school- related factors that influence student outcomes. As such, this bill would provide ongoing high-quality professional development to principals and school leaders, including multi-year induction and mentoring for new administrators. In this way, we will ensure that principals and school leaders possess the knowledge and skills to use student data to inform decisionmaking, communicate with families and local communities, and design and implement strategies for addressing student needs, including for students with disabilities and English Language Learners.

Additionally, our bill recognizes the importance of creating compensated leadership opportunities for teachers to take on additional roles and responsibilities outside the classroom, which will increase collaboration and the sharing of expertise among teachers and staff and improve instructional practices throughout the school. It also seeks to include for the first time in law a requirement that districts conduct surveys of the working and learning conditions educators face so this data could be used to better target investments and support.

Another precedent set as part of this legislation is that it requires an independent, formal review of professional development, mentoring, and evaluation programs. This review would look at whether these programs are effectively implemented and raise student achievement; retain effective teachers; improve classroom and leadership practice; and increase family and community involvement. We must ensure that our teachers and school leaders not only have access to high-quality professional development opportunities, but also know whether or not those programs are actually working to improve classroom practice and student learning.

Lastly, throughout the bill, school district collaboration with teachers and staff is viewed as a key element, particularly in the development and implementation of the teacher evaluation system. Research has shown that true ``teacher buy-in'' is an important factor in ensuring the sustained success of school reform efforts. In Rhode Island, we have seen in recent months an example of this as the Providence School District, educators, and the local teacher's union partnered together to embark on critical school improvement efforts. I am pleased that the Administration also has recently recognized the importance of teacher buy-in when it awarded the first Race to the Top grants to Delaware and Tennessee--both states that had applications with nearly 100 percent local teacher union support.

I worked with a range of education organizations in developing this bill, including the Alliance for Excellent Education; American Federation of School Administrators; American Federation of Teachers; American Association of Colleges for Teacher Education; Association for Supervision and Curriculum Development; Center for American Progress; Educational Testing Service; National Association of Elementary School Principals; National Association of Secondary School Principals; National Board for Professional Teaching Standards; National Commission on Teaching and America's Future; National Middle School Association; National Staff Development Council; National Writing Project; New Teacher Center; New Teacher Project; Pi Lambda Theta; and Teacher Advancement Program. I thank them for their input and support for the bill.

I urge my colleagues to cosponsor this bipartisan bill and work for its inclusion in the upcoming reauthorization of the Elementary and Secondary Education Act.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

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

Mr. President, I rise today in support of the nomination of Lael Brainard to be Under Secretary of the Treasury for International Affairs.

I know Lael personally. She is a renowned expert in international economics, a dedicated public servant, and is highly qualified for this important position. I had the privilege of working with her when she was a member of the Clinton administration as Deputy Assistant to the President for International Economics. Then she went on to be a vice president and founding director of the Brookings Institution's Global Economy and Development Program and then an associate professor of applied economics at MIT's Sloan School.

She has extraordinary credentials and experience, but she is also, in addition to that, someone who has a wide ranging interest in international economics, international affairs, and international security policy.

She is someone I have known for many years, someone I respect immensely for her judgment, her maturity, and her dedication to not only the country but also to ensuring that our policy reflects our highest ideals, as well as advances our cause around the world.

She has been nominated for a very critical position. International economics is no longer a secondary concern. It is of primary concern, if it ever was a secondary concern. We are now approaching a time when our relationships with the world's economies are no longer one of the strong versus the many smaller economies. We are in a very competitive global economy, and we need this type of representation in the Department of the Treasury. We have to engage China, and no one is more thoughtful and better prepared to do that than Lael.

We have to stabilize this economy through this financial crisis which we are seeing not just in terms of private markets but the situation in Greece, the issues of sovereign debt. All of these cry out for an individual in the Department of Treasury who is not only well versed but also in place to do the work. Again, I can find no higher qualified candidate than Lael.

We have to expand export opportunities. The President has rightly called upon this country not only to begin to grow again but to direct our growth away from domestic consumption to export. We need someone in the international arena fighting for us, the United States. We need an individual who is responsible and accountable for that effort. Again, I cannot think of a more experienced, more dedicated, and more qualified individual than Lael.

We have been waiting, the Department of Treasury has been waiting, Lael Brainard has been waiting, since December 2009 for confirmation. That is a long time to put a high priority issue on the back burner.

What is ironic is it appears no one is challenging her experience, her credentials, her demeanor, her temperament--anything. She is collateral damage, if you will, in another dispute which is not one of the most significant and commendable parts of the process here. We all have issues with individual candidates, but after those issues are well ventilated and since December 2009--that is a long time--we have to take it to a vote up or down. I urge that her nomination move forward this evening. She is extraordinarily qualified, and she is someone who can take on the extraordinary challenges of this job.

Frankly, right now we have wasted months and months through this process where we could have had the very best person available focus on the international competitiveness of the United States, and I think our constituents demand it.

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

Mr. President, we are here to move forward on extending unemployment benefits, which is long overdue. They expired April 5. We have thousands and indeed hundreds of thousands of our fellow citizens across the Nation who need this assistance.

In my State of Rhode Island, it has become even more necessary. Not only are we seeing unemployment rates ranging around 12 percent, but last week we endured the worst flooding in the history of our State. It has swept through a large portion of our State. Senator Whitehouse and I have been going from town to town and neighborhood to neighborhood. People's homes have been engulfed in water, up through the first floor. They have lost their utilities. They have lost their appliances. They have lost their precious mementoes--everything. We have also had commercial operations that have been flooded. Our largest mall in the State, Warwick Mall, has been completely inundated. It has been closed now for almost 2 weeks. Literally hundreds and hundreds of employees have not been able to work. They are now eligible, through no fault of their own, for unemployment compensation. So we have to do this. This is an example of one State, but it is throughout this whole country.

What is also adding further necessity to the legislation before us is that--what we have found is that our Federal, State, and local officials have been extraordinarily prompt in responding to the disaster. I thank the President. He very quickly issued a Presidential disaster declaration for Rhode Island and parts of Massachusetts, as well as other areas of New England. FEMA has been on the ground. They are doing a very good job. But for someone who has lost their home and all of their possessions, someone who also may have lost their business simultaneously, every moment is precious. Despite the extraordinary efforts of the men and women of FEMA, the Small Business Administration, EPA, the Corps of Engineers, State officials, and local officials, we have to do much more for these people.

One of the ironies is that--one of the benefits of the Small Business Administration is essentially providing loans to households and to businesses; however, they are limited unless these businesses can get flood insurance. Private flood insurance is out of sight financially.

Public flood insurance has been without authorization. In this legislation, we will have a temporary extension of the National Flood Insurance Program. Let me translate that into practical terms. SBA in Rhode Island could go to a business and say: You have had physical damage. We can lend up to $2 million to you. Unfortunately, because you can't get flood insurance, we are limited to giving you $14,000. When you offer that to someone who is desperate, who is seeing hundreds of employees without work, who is trying their best--in fact, even the idea of taking another loan is a very great leap forward. To say: You need $100,000 or $500,000; we can give it to you, but--it is the classic catch-22. In this legislation, we can extend this program, even for several weeks, but allow individuals in these affected areas to qualify for what they need.

In terms of home loans, the limit is not that high, but it could be up around $40,000 for personal property and $200,000 for real estate. I have been in homes where the damage is excessive. Yesterday, I walked into a home in Cranston, RI, and a father and his two grown sons were ripping up the tiles. The whole first floor has to be gutted and replaced. They may just try to do it on their own, they may try to seek bank lending, but it would be nice if they could get the full support of the Federal Government, as we intended when we passed the SBA laws and disaster relief laws.

In terms of economic injury, if there is a business that has lost all of its inventory, that has to close, that has just lost business because of the flood, they, too, can qualify for loans--and again, the total is up to $2 million. However, without flood insurance, the cap is $5,000. So going to someone who has lost all of this and saying to them: Well, let me explain the intricacies. You can get this, but you can't get this. If Congress acts, you can get this. We have to do much more for our citizens. If these programs are available, we have to make them truly available.

One of the consequences, frankly, of this political jousting back and forth is we lose sight of the effect on our constituents, the effect on real people and real problems. As a result, they are looking at us here and saying: What is going on? You have authorized the program. You have the money to loan me up to $2 million, but you can't because you can't authorize another program. We might understand that procedurally. We might understand the delays we see here, et cetera. But the American public doesn't understand it. They have a problem; they expect their government to respond, particularly when the programs are already authorized, when the programs are there, and we have done it in the past. I would hazard a guess that every Member in this Chamber has used--or their constituents have used Federal flood relief programs, agriculture relief programs. I supported every one of them because when Americans are facing a natural disaster, they need all of us to rally behind them and support them.

Well, now is the time in Rhode Island and Massachusetts. We need that support. For people to oppose it--oh, we object to this or that--that is not what we are called upon to do. We have people who are desperate because of a natural disaster. We need unemployment compensation for those people and for the thousands who are still looking without success for jobs, and we also need it to assure the people that their welfare is our goal. That is what we do. We can sort out the nuances of conflicting programs and conditions, et cetera, so that they get the help they need.

So I hope we can move through this motion to proceed and get on to a serious debate. I personally believe we have to extend unemployment compensation through the end of the year. This ``Perils of Pauline'' every 30 days leaves people to wondering what is happening to them.

I was in a diner yesterday in Rhode Island, and a woman stopped me and said: When are you going to extend unemployment insurance? I don't know if I am going to get it. I am running out of resources.

This is a woman who has worked all of her life. In fact, she told me she had been laid off once before because she didn't have the training, and then she went and got education through a Federal program, moved into administration, and was just let go by her company because of the downsizing. She played by the rules, she has done everything asked of her as a citizen, and she is just waiting there.

We have to do more. So I hope the logic of our constituents might overwhelm the logic of this Chamber at the moment.

Mr. President, with that, I yield the floor.

Cloture Motion

Mr. President, I thank Senator Stabenow.

We are here to attempt to extend unemployment benefits for a brief period of time so Americans do not get caught up in the expiration of these benefits on April 5. This has been a repeated struggle. We have had many incidents over the last several months where we have had to come down here and, at the last moment, attempt to project these benefits further. I hope we do not fail again today.

In 2009, when President Obama walked into office, we were losing 700,000 jobs per month. This is a crisis of epic proportions, rivaling, in some respect, in some regions of the country, the Great Depression. In my home State of Rhode Island, we have a 12.7-percent unemployment rate, and it has been persistent now for almost 2 years. We are seeing an unfortunate record of long-term unemployment. We have to help our colleagues, our neighbors, our friends, and we have to do it in a way that does not deny them the basic necessities to hang on in a difficult economy.

But this situation is not just as a result of the last several months or the last several years. If you look back across the past decade-- from 2000 to 2010--it has been an extraordinarily unproductive one for working Americans. There has been zero net job creation since December 1999. We have had no decade since the 1940s where job growth was less than 20 percent. This is the culmination of a decade in which people could not find the kind of work they typically found in America. We saw middle-income households' earning power decline. They were making less in 2008 than they were in 1999. Two-thirds of the Nation's total income from 2002 to 2007 flowed to the top 1 percent.

So middle-income families have been losing out persistently, and now they have hit the skids because so many of them now are seeing their jobs go, seeing their house threatened with foreclosure, seeing the dream of sending their children to college evaporate. At least the minimum we can do is provide the kind of assistance they need.

We routinely, when there is a natural disaster, provide assistance. In the last 20 years, an estimated $336 billion in disaster assistance and $61.8 billion in agricultural assistance has flowed to the States. This is a disaster in the same respect. It is a disaster to individual families who have lost their employment.

The irony here is, if a flood had washed through a State in the Union and destroyed the work of 12 percent of the population, we would be here with disaster relief to get the funds to give loans, to give support, et cetera. Well, this is a disaster. We must move.

In that respect, seeing my time is coming to a close, the time I have----

Mr. President, I thank the Senator from Oklahoma. Let me take 1 or 2 more minutes. That is extremely thoughtful. I thank the Senator.

We have an opportunity to act today, and we should. The proposal is to go ahead and to extend through the next several days the existing benefits so we have time to come back. We have already sent to the House an extension of unemployment benefits that will carry through to the end of this calendar year. It also includes FMAP provisions, which are extremely important to States. I think in the spirit of letting us continue to support these Americans while we debate and finally conclude, I hope successfully, a longer term solution is the best thing to do.

Unanimous Consent Request--H.R. 4501

My colleague Senator Stabenow an hour ago propounded a unanimous consent request, only to receive an objection. I will once again ask unanimous consent that the Senate proceed to the immediate consideration of Calendar 323, H.R. 4501, to provide a temporary extension of certain programs, that the bill be read three times, passed, and the motion to reconsider be laid upon the table.

Mr. President, I appreciate the Senator's objection. Additionally, I appreciate his consideration in allowing me to speak.

Let me conclude. We have a huge debt at the moment. I think if you look at the major contributing factors of that debt, they would include tax cuts that were unpaid for, supported strongly by the Republicans, which went dramatically to the richest Americans, and two wars that have been unpaid for. In fact, I think in a few weeks we are going to have to consider another supplemental Defense budget which at this point I do not believe is paid for and which I do not feel will engender any objection by the Republican side. It will include, given the nature of counterinsurgency operations, monies that will be used, ironically, to help develop productive jobs and build clinics and do things our soldiers must do to secure the peace in Afghanistan and Iraq. Yet at the same time we can't find that kind of money here without on offset to help Americans.

So there is a question of priorities. There is a question of the deficit. Again, repeating something my colleague said, I too recall when we had a surplus. That was under the leadership of President Clinton. There were tough votes by my colleagues and myself. That surplus has dissipated. We are now in a severe situation with the deficit. The compelling priorities of Americans who need to work and can't find it yet are extremely persuasive and should be responded to by the success of the bill.

I again thank the Senator from Oklahoma. He is extraordinarily kind.

I yield the floor.

Mr. President, I had the great privilege of observing Senator Dodd as he stepped into the breach for Senator Kennedy and did an extraordinary job--hour after hour after hour--listening to the comments, the suggestions of both sides of the aisle. I think about 400 amendments were filed, and 161, or so, were accepted. In that process, his leadership was extraordinarily effective and critical. So the praise he rightfully accords to others he must share in a major way. We would not be here today if Senator Dodd had not stepped in while simultaneously also doing financial reform and getting us to this moment.

So I say to the Senator, thank you.

I concur, obviously, with his comments about Senator Baucus and express the respect I have for Senator Baucus. As chairman of the Finance Committee, Max had an extraordinarily important role to play, and he played it with great wisdom and great judgment throughout.

Again, we are here today because of these two gentlemen, and my colleagues in the House.

I, too, commend the President. It would have been easy at any time in this process to fold up the book and say: Well, I have joined the ranks of all my predecessors since Franklin Roosevelt. I have tried and have not succeeded. I think at moments he might have come tantalizingly close to that conclusion. But he pressed on. Ultimately, it was his decision more than anyone else to try to do this that got it done.

As Thucydides said: The bravest of the brave are those who, seeing both the glory and the danger, go forth to seize it. These gentlemen-- particularly the President--saw the danger and the glory and refused to retreat and went forward. We have a historic victory today. But our work is not done.

Madam President, even though we have made an extraordinary advance in health care reform, we still have millions of Americans who are without jobs and in need of unemployment insurance. We are in a situation that requires action.

Early this month, we were able to pass a 30-day extension by a vote of 78 to 19. It was overwhelmingly adopted, but it was not quickly adopted because of the delay and the procedures imposed upon the process. We might in this Chamber understand the nuances of rules and procedures, but for the people who have been without work for up to a year or more, the nuances escape them. They need help. The reality is, on April 5 this extension will expire. We will not be in session, so we are here today to continue the work that we must do as Members of this Senate.

We have already passed in this body a year-long extension along with some other tax provisions--again, under the leadership of Chairman Baucus. That provision is over in the House, and it is unlikely to move today or tomorrow. The House sent us a provision for another 1-month extension. That is bottled up. But, again, all of these legislative initiatives do not put the check in the mail for those who are without work.

That is what we have to do. We have to pass another extension, at least to get us from April into next month and beyond. Of course, I think the year-long extension until the end of this calendar year is the right approach. It has already been adopted, and I hope we can return and embrace that proposal.

If we do not move, at a minimum, for a temporary extension, approximately 1,200 Rhode Islanders will start losing their benefits each week starting April 5. By the end of April, three-quarters of 1 million unemployed workers across the Nation will lose their benefits.

This is at a moment when we are beginning to see some economic traction, some reports of progress in labor markets. Just today it was reported that initial unemployment claims fell by 14,000--a number much larger than the experts expected. Now we are in a very difficult moment when we look at the good news being that ``the claims fell.'' But that is a prelude to the point we have to achieve: when not only the claims fall but the jobs start growing and growing and growing.

We have come a long ways since President Obama took office: 700,000 people a month who were losing their job--with huge, catastrophic, ramifications throughout the economy. That is beginning to turn around. But until we are back to a robust employment situation, we cannot ignore people who need help through the unemployment compensation system.

I believe the major point at this juncture between the two sides is the issue of how do we pay for this, its cost. We have adopted, as Democrats, what was ignored and then dismissed by Republicans, which is the concept of pay-go, of paying for government activities either by revenue increases or by offsetting reductions. But we have always understood that in emergencies these pay-go rules properly can be suspended;

that we can go ahead and deal with an emergency.

Frankly, this situation we are in today, that is triggering all this concern--and rightfully so--of the deficit is not something that was created by President Obama. He walked in with a $1.3 trillion deficit-- in sharp contrast to President George W. Bush, who walked into office with a $5.6 trillion surplus over 10 years. That was not the result of just the economy humming along, that was the result of very difficult choices that were made in this body and in the House of Representatives under the leadership of President Clinton and, once again, under the leadership of my colleagues such as Max Baucus.

But that surplus, that opportunity of a robust employment picture where unemployment was around 5 percent, that was the legacy of President Clinton. Frankly, the legacy of President Bush is significant deficits and significant unemployment and financial crisis. More debt was added in that administration--$3 trillion--than all previous administrations combined, from George Washington all the way up to George W. Bush.

So this deficit is a real problem. But a lot of it was the result of decisions that were made by that administration to finance activities not through pay-go but through just piling it on the deficit. Tax cuts were not paid for, and the tax cuts were skewed in the nature of a progressive tax to the wealthiest. Iraq, Afghanistan--none of those wars were paid for through offsets or anything else. The prescription drug program, Part D, was not paid for. It was, again, added to the tab of future generations. It is interesting, today we have actually tried to fix that with the passage of the health care bill by closing the doughnut hole.

So at this moment, when we face a true employment emergency, when people say: Well, we are now going to insist upon complete offsets, it misses what was done casually and repeatedly during the Bush administration for areas that you could argue were not true emergencies. Now we face a critical emergency. In my State of Rhode Island, we have a 12.7 percent unemployment rate. If we do not start supporting and turning that around, it will get worse rather than better. We have never in recent history--going over several decades-- ever suspended emergency unemployment benefits when the unemployment rate was at least 7.4 percent or higher. We are at nearly 10 percent unemployment nationally, and in some States--again, in Rhode Island, it is close to 13 percent. Until we lower joblessness significantly, we are still in an employment emergency.

The other aspect of this, too, is unemployment compensation is one of the major activities for stimulating the economy. The bang for the buck is significant. There is $1.90 of economic activity for every $1 invested in unemployment insurance. It makes sense. People need the money to go to the store to buy food for their children. They need to pay for the gas to look for a job. That money will come in and be multiplied in the economy.

The irony, too, of trying to use, in some respects, the stimulus money to pay for the unemployment is it is basically taking away money we have designed to get the economy moving and spending it for a program that will also help the economy move. But you are going to get a lot less bang for the buck in terms of decreasing our overall commitment to that economic activity in the country.

So we have to move. I would urge an immediate extension of the unemployment compensation legislation to give us a chance to return and work with our colleagues in the House for the legislation that will at least guarantee an unemployment extension until the end of this calendar year. But we have to move. We have to act. We should do so now.

With that, I yield the floor.

Mr. President, on April 5, the extension that was recently voted for extended unemployment compensation benefits will expire. We need to at least provide for a temporary extension while we await the resolution of a much broader piece of legislation that is in the House today which would provide for an extension of unemployment benefits from today until the end of the calendar year, as well as FMAP payments to the States and other provisions.

This is absolutely critical. In my home State of Rhode Island, we have basically a 13-percent unemployment rate--12.7 percent. We have a record number of long-term unemployed people. This is not a situation, as in the past, where there was a temporary labor crisis. This has been going on in Rhode Island for almost 2 years or more, and people have reached the end of their resources and the end of their patience. For many, the only thing that is sustaining them--and not particularly well--is the fact they are still getting some unemployment benefits.

So we have to move very aggressively to provide a solution. We have never, in the last several decades--reaching back at least as far as the 1980s--denied extended unemployment benefits as long as the unemployment rate nationally was at least 7.4 percent. It is 10 percent, and in many States it is higher than that--Rhode Island being one of those States. So this would break tradition in terms of disrupting, interrupting, preventing extended benefits at a time when we have 10 percent unemployment.

We have persistently seen this, accurately and realistically, as an emergency--an emergency that allows us to provide funding without offsets. That is something that I think still is compelling. This is an emergency. Perhaps one of the ironies that will take place on this floor in the next several weeks is that we will call up a supplemental budget from the Department of Defense which, as I understand, will not be offset totally. One of the ironies is that we will be providing benefits--because part of our strategy in Afghanistan and Iraq is civic engagement--we will be providing employment opportunities and investment in infrastructure for Afghans and Iraqis without offset, which is my understanding at the moment. The irony, of course, is that for our own citizens we are claiming: No, we can't do that.

The other side has accumulated, under the Bush administration, a huge debt. In fact, in the term of the Bush administration, the national debt grew astronomically. Part of it was because repeatedly the Republican side refused to provide offsets to the funding for the war in Iraq, the war in Afghanistan, and Medicare Part D, which was an entitlement payment for seniors in terms of their drug prescriptions. They thought that paying for things was an undue constraint on their plans. But now that we are in a crisis that affects Americans, there is the insistence during this emergency of paying for it, which contradicts practice and contradicts the real needs out there.

One final point. We are now beginning to see some very limited progress on the employment front. This week's report about jobs caused a very positive reaction in the marketplace because the number of first-time claimants for unemployment compensation dropped much further than they thought. That suggests we are beginning to bottom out. There are other reports that suggest we will see some job growth beginning. That is because of the stimulus efforts we have undertaken today and in the past.

Part of that stimulus effort has been unemployment compensation insurance. For every dollar we invest in unemployment compensation, there is $1.90 growth in economic activity. That is the result of studies over many years. So when we don't invest in these types of programs, we are not only denying sustenance to many families, we are also not providing the kind of economic stimulus that the country needs to move forward.

So for all those reasons and more, I hope we can move, in the course of this evening or tomorrow, to adopt a measure that will allow us to continue the funding for unemployment compensation.

With that, I thank the Senator from Illinois, and I yield the floor.