Floor Statements

Mr. President, I ask unanimous consent to be recognized as in morning business.

Mr. President, in the next 48 to 96 hours, Members of this Senate and Members of the House of Representatives will be called upon to make what may very well be the most important decision any of us have been asked to make, certainly domestically.

There have been a lot of reckless comments, a lot of sobering comments, a lot of speeches made on this floor, a lot of accusations made regarding the recovery or rescue supposedly by Secretary Paulson. But it is very important for Members of this body to, first of all, make sure that facts are reported accurately and, second of all, that we give ourselves a chance to get this action right because there will be no second chance.

Yesterday, two Senators--Senator Coburn from Oklahoma and Senator Gregg from New Hampshire--made very eloquent, accurate, and sobering speeches about the gravity of the economic situation we face but also correcting some of the accusations that have been made by some about the recovery that has been proposed.

This morning, I was heartened to see two people in the media make comments early on the morning news, which gave me hope that we are finally coming to a point where people are going to report facts rather than fantasy.

Ali Velshi, who is the economic reporter on CNN, in fielding a question from a listener who blamed the rescue we are talking about to be a rescue of Wall Street, pointed out to that person that this is not a rescue of Wall Street. We are giving a chance to provide liquidity to banks, savings and loans, credit unions, and financial institutions of the United States of America, not Wall Street.

And Boone Pickens, who was interviewed because ostensibly he has lost millions of dollars of his multibillion assets in recent days, when asked about the consequences of us doing nothing, said very simply: ``You must trust Mr. Paulson.''

I trust him. We must do what is right. Those are sobering comments. I thought what I would do for a little bit is set the record straight, or at least accurately, of some of the things that have gone on, some of the things that are going on, and what the Paulson proposal can do when it is perfected to help us in a very difficult period of time.

As I said on the floor of this Senate on many occasions, the villain in this situation is very essentially Wall Street's investment banking community and Moody's and Standard & Poor's, the rating agencies. They created subprime securities. Moody's and Standard & Poor's wrote them as investment grade. They sold them around the world. When those high- risk, poorly qualified, high-yielding loans were made and began to be defaulted on, the securities started losing their value, and they lost them at a rapid rate. They became known as subprime securities or, as some have called them, toxic assets.

The problem that faces the country today is the uncertainty of the value of those assets has plummeted their value to virtually zero. There is no market. The American people yesterday, in looking for a place to invest their money, were willing to take zero interest to buy Treasury bills, meaning they were looking for a place to park their money.

We are not in a time where there is any confidence in the investment community and everybody is worried and concerned. Secretary Paulson's proposal is to spend up to--and I would use the word ``invest'' up to rather than ``spend''--$700 billion to purchase from financial institutions these mortgage-backed securities at a discounted price established by the Secretary. Assuming for a second the discounted price is 50 percent, that $700 billion would actually take off the shelves $1.4 trillion in mortgage-backed security assets held currently by financial institutions--a significant amount of money. The minute the Treasury begins to buy these entities and these securities, there are going to be people coming back to the market to buy them as well.

Think about this, Mr. President: If you buy a security at 50 cents on the dollar, then you are reducing what the company paid for it--their investment--by 50 percent. If the default rate on mortgages--on subprime loans--in the country is 12 or 15 percent, which in some cases it is, that is only 85 percent of 100, which means there is a 35- percent spread on those mortgages that are paid to maturity.

So with the strength of the country being able to buy those securities, hold those securities to maturity, there very possibly is a significant margin for the Treasury of the United States. The amount of the investment made by this country will never be $700 billion. It will be somewhere between $700 billion and whatever we recover from those securities upon their maturity, which could well be $500 billion, $600 billion, $700 billion, even maybe possibly a margin above that.

So this is not an investment to save Wall Street. This is an investment to provide liquidity to the lending institutions that service my citizens in Georgia and yours in Ohio and my colleague's in Oklahoma, the people who now are struggling to be able to get credit for their small business or for their car loan or for a mortgage.

I think it is also important to recognize that some of the actions taken by the Fed and the Treasury in the weeks leading up to this decision, which have been referred to also as Wall Street bailouts, have been, in some cases, misreported. The Bear Stearns investment of $29 billion helped a transaction to be made that caused Bear Stearns to lose 90 percent of its value. That is not a bailout. AIG is paying the taxpayers of the United States 8\1/2\ percent on a loan we made to AIG to allow it to liquidate itself--a loan, by the way, that the U.S. Treasury will make money on.

The proposal being made on those two is off the balance sheet for the United States. The $700 billion proposal is on the balance sheet, and it will create a liability, and during its maximum time it will raise the debt. But as the securities are held to maturity, as they are sold at a price between the discount they are purchased for and the value they ultimately are redeemed for, the Treasury will have a reduced and diminished liability.

I am not here to sell the Secretary's proposal, and I am anxious to wait for the meeting this afternoon to see the final details, but I am saying that words are important and loose lips at a time such as this in our country are very dangerous. For us to castigate a recommendation to save our economy--which, in fact, is a rescue and not a bailout--is wrong, and it is wrong for elected officials, such as myself or anyone else, to take fast-and-loose facts and apply them to a situation that is the gravest we have faced in this country in a long time.

So I take the word of Boone Pickens to place confidence in those we have entrusted to represent us--in this case, Secretary Paulson. I take solace in the words of the President last night and the sobering comments of Senator Judd Gregg on the floor of this Senate when he explained accurately and correctly the financial effects of doing nothing in this situation.

Mr. President, we have 48 to 96 hours to make a decision. Let's make it on the facts. Let's make it in the best interests of the American people. Let's

make it in the best interests of Main Street because, after all, those are the people we serve--the ones who go to our banks, our savings and loans, who run our small businesses, and who are our next-door neighbors. They are the Americans we represent. They are the Georgians I represent. When I make a decision this weekend, it will be in their best interest, their children's, and their lives.

I yield the floor.

Madam President, earlier today I spoke on the floor about the impending financial difficulties we are facing and the issues before us. I come back not to repeat those remarks at all but, rather, in this time of turmoil and stress, to recognize that all of us as Americans, and Georgians in my State, in times of difficulty turn to those institutions of faith and family that give them strength.

In Georgia, in the fall, there is another institution that gives us strength, the University of Georgia football, the Southeastern Conference, and a man named Larry Munson. On Monday of this week, Larry Munson, at the age of 86, announced his retirement, after 43 years as the voice of the Georgia Bulldogs.

He first started in Wyoming, moved to Tennessee, and in 1962, the Atlanta Braves brought him to Atlanta to be the first announcer when the franchise moved from Milwaukee. In 1996, Joel Eaves, the athletic director, asked him to come to Athens. He became an institution not just in Athens, not just in the Southeastern Conference but of announcers around the world.

He is in the company of Chris Schenkel, Frank Jackson, and those famous voices all of us have known in sports. But more than anything else, Larry Munson coined phrases that now are listed in dictionaries and history books for their uniqueness.

In 1981, when the University of Georgia upset Tennessee in Knoxville, TN, on the last play of the game, he talked about how his ``Bulldogs had stepped on and crushed the Tennessee faces just like they had on a hobnailed boot.''

In 1982, when Georgia won the Southeastern Conference in Auburn, it was Larry Munson who declared that ``sugar was falling from the skies'' as Georgia got an invitation to go to the Sugar Bowl.

Probably the most memorable, in 1980, when Herschel Walker, then a freshman, scored his first touchdown of a storied career in college, Larry Munson replied, as he announced the run: My goodness, he is running over people. He ran right through people. And, oh, my goodness, he is only a freshman.

These and so many more have endeared Larry Munson to the people of Georgia, the Southeastern Conference, and collegiate gate football. So on this day in the Senate, as all of us seek

comfort in those things we appreciate, love, and admire, I wish to express my appreciation to Larry Munson and the contributions he has made to athletics in our State and to the University of Georgia and wish him the very best in the years to come.

God bless you, Larry.

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

Mr. President, on October 23, 2008, the YWCA of Northwest Georgia will hold a vigil on Marietta Square in my hometown to commemorate Domestic Violence Awareness Month. I wish to express my gratitude for the work of the YWCA of Northwest Georgia and its executive director Holly Comer as they bring awareness to this important issue and its impact on our community.

The YWCA of Northwest Georgia opened the doors to the first domestic violence shelter in Cobb County in 1978 in an effort to end domestic violence in our State, our communities, and our homes. A home should be a place of stability, comfort, and love. Domestic violence shatters this important foundation. The terrible tragedies that result from domestic violence destroy lives and insult the dignity of women, men, and children. I believe I represent all Georgians when I say thank you to the YWCA of Northwest Georgia for its hard work to combat domestic violence and help those who have been victimized.

I am grateful for the social service providers, advocates, counselors, and many others who provide care for the victims. I am also grateful to the law

enforcement personnel and others who work to bring offenders to justice. As we recognize Domestic Violence Awareness Month, we are reminded of the important service these individuals provide.

Domestic violence has no place in our society, and I am strongly committed to addressing domestic violence and helping those who have been victimized. By working together with the YWCA of Northwest Georgia and its dedicated staff, we can build a Georgia where every home honors the value and dignity of its loved ones.

Mr. President, I want to open my remarks by simply stating that words matter. And to the distinguished Senator from Ohio, for whom I have the greatest of respect, I gained a lot of concern yesterday when I heard the words used in so many speeches given on the floor, especially at this disconcerting time, when the American public is so worried about our marketplace and our financial markets.

As Members of the Senate, I think it is very important we be conscientious, that we be positive and prudent in every word we use. Words matter. We have seen a savings and loan in California fail because words got out that there might be a failure and it became a self-fulfilling prophecy. We have seen things happen in the economy in large measure that were reactions to words that were said which should not have been said at all.

In making that statement, I am going to make a speech about what is happening right now on Wall Street and about our role in the Senate, and I will remember the admonition I gave that words matter. The words I want to use are words that I think are in the best interests of the people of the United States, but more importantly of this institution.

We can't play this historical blame game and set a precedent for the cause of what is going on in the financial markets today. We have to recognize that we equally, as Republicans and Democrats, have a responsibility to work together and to recognize the things we have done that have contributed to the problem. And I will give some examples.

One of the problems with the American economy today is the deficit of $407 billion, which we will realize at the end of this month when the fiscal year ends. Yes, part of that deficit is because we have been at war. And had we not gone to war, we might be in the throes of terrorism. But that is another debate. But a lot of that deficit is about Federal spending. A lot is about the budget process. As Members of the Senate, we have yet to take up a single appropriations bill on the floor of the Senate, yet in less than 2 weeks, this fiscal year will end. I think it is our responsibility at a time of deficit, at a time of spending difficulties to get that debate to the floor of the Senate and for all of us, Republicans and Democrats alike, to recognize we have a role in what that deficit is.

Secondly, the concerns regarding the financial markets now started back in May and June, when oil prices went to $147 a barrel. We are within a week, almost a week, of adjourning, yet it is patently clear there will be no resolution by Congress to any way forward in terms of domestic exploration or dealing with all the other energy issues out there. Those are two things that, had we been doing them this month and in the months previous, might have helped to ameliorate at least part of the concerns on Wall Street.

So I think all of us, Republicans and Democrats alike, must understand that we share part of the blame as an institution, and not just as one political party blaming the other. It is time for cool heads and prudent minds in the Congress to prevail. Americans are concerned. We should not play politics with their future. By way of example, the previous speaker brought back the entitlement debate of 2005 and the challenge of privatization. We must remember today that the debate we had was about one of the problems that Congress has contributed to, and that is a Social Security system from which we have borrowed all of its trust fund and spent all of its money. Because of the way we have managed the fiscal house of the United States, we will dissipate the trust fund in its entirety by 2043. That is something we ought to be addressing. We can have differences on the way to address it, but to try to stigmatize a sitting President or a future candidate when they were trying to address a problem that we all know exists is not the way to deal with these financial difficulties.

On the question of regulation, I am not so sure it is a question at all of needing more regulation as much as it is a question of using the regulatory powers that we now have to address some of these problems. I will give a couple of examples.

On Wall Street, within the Securities and Exchange Commission, there used to be an uptick rule. And the uptick rule basically was that as the market was going up, you could play the market game with speculation. But if it was going down, you couldn't short sell it. What is happening on Wall Street now is there are a lot of people selling short, and they are selling short to the detriment of the American people but to the benefit of the individuals themselves. That is part of the problem. We should ask the Securities and Exchange Commission to look deeply into regulations that worked in the past and see if they can't bring back the uptick rule to stop what has been an abuse in terms of short selling.

Secondly, I have said on the floor of the Senate three previous times--and I will repeat it today because I believe it strongly, and because I think it is more true now than ever before--a significant contributor to the problems we

are facing today is an absence of transparency and accountability on behalf of investment banking. The subprime securities that were created on Wall Street, and were rated investment grade by Moodys and Standard & Poor's, are the fundamental foundation of these financial collapses not just in the United States but around the world because those securities were bought as capital basis for many of the lending and financial institutions.

As we look to the future, and the recovery which we will see--because America always recovers--it is important that we never allow something like the securitization of high-risk paper and rating as investment grade to ever happen again without some level of transparency and an absolute level of accountability on behalf of the institution.

I want to tell a brief story, only for the purpose of letting people know what a small world we live in and how our words matter and the consequences to our actions. I traveled to Kazakhstan in August with the majority leader, Senator Reid. It was an educational trip of immense benefit to me, and I think of immense benefit to the country, in terms of what we did. Kazakhstan is a country of 16 million people with the largest find of oil in all of Asia. It is a wealthy country that built its capital city of Astana from scratch 10 years ago.

When we landed in Astana and left in a vehicle provided by the embassy and drove into town, there were landscaped gardens, beautiful buildings, gold-domed mosques--obviously, the best of everything because of the wealth they had.

But I noticed something interesting. I counted 17 buildings, midrise and high-rise, partially completed, cranes up, with nobody working. When we got to the embassy I asked our ambassador when he said, Are there any questions: Is there a holiday?

He said: No. Why do you ask?

I said: Nobody is working on all these unfinished buildings. Why is that?

He said: The U.S. subprime mortgage crisis.

I said: I don't understand.

He said: The bank of Kazakhstan bought a bunch of the subprime securities in the United States, and when Merrill Lynch wrote their portfolio down to 22 cents on the dollar, the bank of Kazakhstan did the same thing. And when they did, they had to stop funding construction and stop funding mortgages.

If we do not think we live in a small world, if we don't understand the consequences of our words and the policies that are initiated in terms of our financial products, we have another thought coming.

Last, I compliment the Congress and use as an example the housing bill, where we have the power to address and strengthen our economy. In July, this Senate passed, by a vote of what I remember to be 83 to 14-- it may have been slightly different--a bipartisan housing bill that did a number of things: It modernized FHA, raised loan limits, provided a refinance mechanism for subprime loans rather than foreclosure, but also answered the question of Freddie and Fannie and provided an opportunity for the Secretary of the Treasury and the Federal Reserve to address Freddie Mac and Fannie Mae should those institutions get in trouble.

While we were gone in August they got into trouble. They got in trouble in part because of their own doing but in trouble in part also because of a lack of confidence. If we had not passed that bill that allowed Secretary Paulson to come in and stabilize Freddie and Fannie, the source of mortgage money for the people of the United States of America, the problems we are experiencing now are nothing compared to what would have happened.

Our actions matter and our words matter. We should be careful to understand that in a time of uncertainty in our financial markets and of concern by all Americans, rich and poor, Republican and Democrat, our words matter. We should work diligently to give people confidence in our system of government and our financial system, provide the intervention and the appropriate aid while necessary but not overregulate or stigmatize a system that has worked for the better part of two and a quarter centuries.

I love this country, and I appreciate the people I represent. I suffer as they do today with the uncertainties in the financial markets. I hope all of us will commit ourselves to do those things within our grasp to see to it that we have a sounder economy, a sounder dollar, and a sounder America. Let's do our appropriations. Let's have an energy policy that works. Let's look at those positive things that have happened in the past on Wall Street that can bring back a level of accountability and transparency that are absolutely essential in the United States of America.

I yield the remainder of my time.

Mr. President, today I mourn the passing and pay tribute to a great Georgian. Broadcaster Skip Caray passed away in his suburban Atlanta home on August 3, 2008, leaving a tremendous void in the hearts of Atlanta Braves fans nationwide.

After years of calling basketball and hockey games in St. Louis and Atlanta, Skip Caray began broadcasting for the Braves in 1976. Baseball was in his blood, and while their styles were different, Skip brought the same warmth and humor to his calls as his famous father, Harry, delivered to the Chicago Cubs for years. Skip Caray passed his love for the game on to his sons, Chip and Josh, both of whom found careers in the same profession as their father.

As a broadcaster for TBS, Skip Caray's voice was not only familiar to baseball fans in the South, but millions around the country. Whether it was the many years that the Braves spent in the depths of their division or the 14 consecutive seasons at the top, Caray provided the voice of a friend who shared the same passion for ``America's Team'' that the fans did. No Braves fan will ever forget Skip urging Sid Bream around third base and into the World Series in 1992 or his elation as the Braves won it all in 1995.

In 2004, Caray was elected to the Atlanta Braves Hall of Fame. At his induction, his mentor, Ernie Johnson, Sr., said that Caray ``had a bigger heart than anyone can imagine.'' Skip Caray will be sorely missed and will remain in Atlanta Braves fans' hearts forever.

Mr. President, I associate myself with the Senators from New Hampshire, Florida, and Texas, and would like to report an interesting occurrence that took place yesterday that kind of verifies exactly what Senator Cornyn said.

After the vote on the media shield motion to proceed, I went back to my office and placed two phone calls, one to the president of the Georgia Press Association, the other one to the president of the Georgia Broadcasters Association. I told both of them: We have had conversations about the importance of media shield, and I know both of you are very interested in it. But I want to explain why a few minutes ago I cast a ``no'' vote on a motion to proceed to media shield.

I said: The reason I did it, quite simply, is that for everybody in my State--and I would submit most everybody in the United States of America--the No. 1 issue is the high cost of energy and particularly the high cost of gasoline.

Both men, both professional journalists, both presidents of their associations, said: We understand.

The broadcasters said: Our talk shows are not calling in about media shield; they are calling in about the gas.

The president of the press association said: Listen, I understand. Read our letters to the editor. I listen at the coffee shop. I know what Georgians are concerned about. It is the high price of energy and the high price of gas.

So that is why I have remained committed to staying on the Energy bill until we find some way to bring Republicans and Democrats together. Both of us can give. I said in a speech the other day: We ought to put our donkeys and elephants in the barn and sit down and talk about ways to really meaningfully change the lives of the American people, not 20 years from now but today.

The country is hungry for a Congress and for leadership that will say yes to more production, yes to more conservation, yes to a better environment, yes to a productive economy, all of which would be the result of a comprehensive, balanced approach toward energy. But a singular slingshot approach or a rifle approach, like just speculation or just drilling or just something else--we have to do it all. We have to do it comprehensively. We have it within our capabilities to do it right.

As the Senators before me have stated, we have all kinds of resources. Many of these resources are not only abundant but they are cleaner than gasoline and they are cleaner than oil--nuclear energy, for example. In America, 19 percent of our electric energy is produced with nuclear; in France, it is 87 percent. Think about the difference that makes not only in the reliability and the cost of energy but the carbon-free emissions that come from nuclear versus the heavy carbons that come from the burning of oil or gas or coal or other sources.

Ingenuity and innovation. The American people are a remarkable people. When confronted with whatever challenge, we have almost always come up with a solution. But sometimes those solutions either take inspiration or they take encouragement. When we needed to go to the Moon and win the space race, we had the inspiration of a great President, John Kennedy, to declare a goal to land a man on the Moon and bring him back again before the end of the decade. We did not know how to do it, but we did it. We need a Congress that is just as bold today to say that $4 a gallon is too much for gasoline, carbon is too bad for our atmosphere, and fossil fuels are geopolitically not in our interest.

It is time that we as America find ways through engineering and ingenuity to invent and to develop and to process those sources of energy that are clean, renewable, reliable, and less expensive. And we can do it. But you cannot do it if you stand in gridlock on the floor of the Senate and the House of Representatives, unwilling to talk about all the issues.

We all have our biases and we all have our prejudices, but all of us take

an oath of office to represent the people of our State and to uphold the Constitution of the United States of America and defend the domestic tranquility of our people. When your economy is tanking, when your debt is going up because of your addiction to foreign oil, and Congress sits here for 2 weeks and debates only one sliver of the solution without everything, then we are not living up to our responsibility.

So if the Georgia Press Association understands, if the Association of Broadcasters understands, if the 17,488 people who communicated last week with my office about one issue--and that was cost of energy-- understand, why can't we in the Senate understand? We are all in this together. We are 100 coequals. We all have the same responsibility. And we ought to all have the same goal; that is, to find a way to thread the needle so we sit down and we develop a comprehensive energy program for the people of the United States of America.

I did a talk show yesterday--actually, it was a television program where I was asked about this energy question. I was asked about the Arab oil embargo of the 1970s. I said that the Arab oil embargo of the 1970s was an early warning. It gave us a second chance to address the energy question. But when prices went down in the 1980s and 1990s and the price of gasoline was not that high, we did not take that chance. Well, now prices have spiked to an alltime high.

This is not a second chance for us in America, this is a last chance for us in America. A sustained cost of gas at $4 a gallon, oil at $120 to $150 a barrel will break the U.S. economy. It will destroy the value of the U.S. dollar, and it will hurt the people of the United States of America.

So it is time for us to put these prejudices aside, put them aside and sit down and be willing to agree. I will be the first person to lay on a table--I am willing to sit down and talk to anybody, anyplace, anywhere, about any singular facet of the energy crisis if they are willing to talk about the other facets of the energy crisis.

As Boone Pickens said, drilling will not solve it, but it will help. Solar will not solve it, but it will help. Wind will not solve it, but it will help. Renewables will not solve it, but they will help. What we have to do is put together the pieces of the puzzle that are within our grasp and make sure the people of the United States have abundant energy at affordable prices. We are sitting on a ham sandwich, starving to death. We are not developing the resources we have at our disposal, and because of that, our citizens are paying a dramatic price.

Anytime, anyplace, anywhere, let's start talking about solutions rather than continuing to perpetuate the problem.

I yield back any time we have remaining, and I suggest the absence of a quorum.

Mr. President, today I honor in the Record of the Senate the Silver Star Families of America, upon the completion of $1 million in donated volunteer hours and materials to remember and honor the wounded and ill of our armed forces.

The Silver Star Families of America was founded on April 11, 2005, and received 501(c)3 status on December 5, 2005. The Silver Star Flag and Banner are symbols of remembrance and honor for the wounded soldiers and their families as well as anyone wishing to honor those wounded during combat while honorably serving in the U.S. Armed Forces. The goal of the Silver Star Families of America is to recognize the blood sacrifice of our wounded and remember their efforts by honoring them with the Silver Star Banner. The Silver Star Families of America also advocates for the wounded and assists in educating their families and the public concerning their plight.

I have had the pleasure of meeting and working with the Georgia representative of Silver Star Families of America, Trish Benefield of Rome, GA, on a number of occasions while she organized State and local events and hospital visits to honor the men and women of our Armed Forces and their families who have sacrificed so much on behalf of our Nation's freedom.

Ms. Benefield, chief Steven J. Newton, founder of Silver Star Families, national president Janie Orman, and volunteers across the country have donated 47,912 hours valued by the Veterans Administration at $934,763. They have also donated over $40,000 in Silver Star Banner distribution and $30,000 in direct aid for items such as services to homeless and near-homeless veterans, care packages, and support of hospitalized veterans and other programs. This achievement is a noteworthy one, and I am proud to recognize this accomplishment today.

Mr. President, I was unavoidably detained during rollcall vote No. 187, a motion to invoke cloture on the motion to proceed to the consideration of S. 3186, the Low-Income Home Energy Assistance bill. Had I been present I would have voted ``nay'' and I ask that the Congressional Record reflect that.

Mr. President, I ask unanimous consent to speak for 10 minutes.

Mr. President, the Senator from New Hampshire has made a compelling speech with which I associate myself entirely. It is obvious he has traveled to his State, as I have traveled to mine, and listened to constituents who tell me their biggest problem, in particular, is the price of gas. It seems to me the world's most deliberative body should never stop deliberation on what is the crisis of the day. The Senator from New Hampshire made a tremendous speech that was right on point. We may have our differences one way or another on what to do but objecting to letting us debate those differences is not acceptable.

For 25 years, the United States has encouraged consumption and discouraged production. It is time we encourage conservation and empower production, as we bridge our way from gasoline today as an energy source to the next energy source of the 21st century, whether it be the lithium battery, hydrogen engine or whatever.

There is another crisis on our economy I wish to talk about for a second that is equally compelling and that is the housing industry and the tremendous stress our financial markets are under and our financial institutions. There have been a number of speeches made on the housing bill, which we will vote on tomorrow at 11 a.m., which, quite frankly, trouble me because they

have not been on target. For a second, I would like to make a few points.

There are a lot of people saying the housing bill we will pass is a bailout for the people who caused the problem. That is not correct. The people who caused the problem are off the radar screen; the investment bankers and Moody's and Standard and Poor's caused the subprime mortgage problem. Wall Street securitized the paper, and Moody's and Standard and Poor's rated it investment grade. It wasn't investment grade and should not have been packaged, but it was. They put out all over America--the originators and lenders--loans that didn't require documentation or a downpayment and that only cost a high yield on the mortgage to make it a nice instrument to sell.

As the housing crises of 1968, 1974, and 1991 were predicated, in part or in whole, on easy credit and shoddy underwriting, so is the stress on our economy today based on that easy credit and shoddy underwriting generated by the subprime market.

The bill we are doing tomorrow is not a bailout to Freddie Mac and Fannie Mae or the institutions that made bad loans. It is an infusion of confidence the financial markets need. Fannie and Freddie suffer by perception from the difficulties of our mortgage market. If anybody would take the time to go look at default rates, for example, they would look at the loans Fannie Mae holds, and they are at 1.2 percent, well under what is considered a normal, good, healthy balance. The subprime market's defaults are in the 4- to 6- to 8-point range. That is causing that problem. That wasn't Fannie Mae paper, and it wasn't securitized by Fannie Mae. They have $50 billion in capital, when the requirement is to have $15 billion, so they are sound. But the financial markets, because of the collapse of the mortgage market, have gotten worse.

I think Secretary Paulson has done the right thing. I commend Senator Dodd and Senator Shelby for the second key component of the bill. The Dodd-Shelby provision ensures that Fannie Mae and Freddie Mac will have regulatory oversight and be held accountable, as the banking system in our country is. What Paulson has done is said, in return for that, we will give to Freddie and Fannie what the American banking institutions have and that is access to the Treasury window for secured collateralized borrowing.

You might say: What does all this mean? What it means is we will put liquidity back into the mortgage market. There will be good underwriting and accountable credit issued by mortgages that are then sold to Freddie Mac and Fannie Mae to provide the liquidity in the marketplace. This is not a bailout for those two institutions. It is an insurance policy that the credit markets will understand that, A, those institutions are strong and the United States is going to hold them accountable and, B, provide them with liquidity when they need it. That is good for this country and this economy, and it would be a tragedy if tomorrow this Senate doesn't overwhelmingly embrace that legislation.

The second component of the legislation is the reform of FHA, raising the loan limits and providing mechanisms also for troubled loans to be refinanced--not a gift as a bailout but providing a lender whose loan is in trouble because the house depreciated below the outstanding balance on the loan--it is going to be allowed to refinance on a fixed rate--an FHA underwritten loan the individual has to qualify for. If the lender takes the discount down, or takes the hit, that loan can be refinanced and that homeowner, instead of being foreclosed on and having a vacant house, ends up having a chance to pay for that mortgage and the economy is improved.

What is happening today in America is the combination of a large number of foreclosures and no liquidity, as the housing market is off in many areas by as much as 50, 60 percent. Home values are declining at a rate of 15 percent per year this year and 11 percent last year. What has happened to American families' main source of spendable income--their equity line of credit--is that it has vanished. That is why the economy has gone into the tank. We had a housing/fuel boom in the 1990s and early 2000s, and now again we have a housing/fuel recession. The only difference between the boom and recession is, during the boom, we had liquidity, but underwriting got too shoddy. Now underwriting is strong, but the liquidity is not there. The FHA reform and Freddie Mac and Fannie Mae reform will, in fact, do that.

There is a third feature I wish to talk about. It is a feature I introduced, originally, 6 months ago in the Senate. It is a housing tax credit for first-time home buyers to go into the marketplace and buy a house. The United States, in 1974, had a serious recession similar to the one we have today. It was fueled by an oversupply of unsold houses in the marketplace. A Democratic Congress and the Republican President, Gerald Ford, in 1975, passed a $2,000 tax credit for first-time home buyers who went and bought a standing vacant inventory house and occupied it as their home. That incentive brought Americans off the sidelines and into the marketplace, and we absorbed a tremendous amount of the standing inventory. Values came back in the United States and the housing market responded. The $8,000 tax credit--$4,000 a year for the first 2 years--on a home that a first-time home buyer buys and occupies is going to be a huge incentive to the housing market. It doesn't bail anybody out; it incentivizes a market to come back. When that happens, the problems go away. We cannot regulate ourselves, as a nation, into a strong economy. But we can incentivize our people and get confidence to the financial markets and restore what is a very shaky economy.

I come to the Senate floor with the following message: I thank Senator Dodd and Shelby for all their work. I commend the House on what they did to make this housing bill a good bill.

Again, I reassure everybody we are not bailing out anybody. What we are doing is incentivizing Americans to come back into the marketplace, providing them with good, accountable, credible credit, so there is liquidity in the housing market, and seeing to it that two institutions that ensure that Americans can be homeowners--Freddie Mac and Fannie Mae--are strong, and the investment markets have the confidence they need to have the support of the United States and, lastly, under the same type of transparency and accountability that the American banking system has been under since Alexander Hamilton.

I yield the floor.

I thank the Senator from Tennessee. It absolutely is essential. The Senator and I share a common border between the States of Georgia and Tennessee, and along that border, Tennessee Valley operates. They are a big producer of efficient, inexpensive, reliable electric energy produced by nuclear power.

In the United States of America today, 19 percent of our electricity is generated by nuclear, 81 percent by coal, gas, and a sliver by hydro. That 19 percent that is nuclear does two things: No. 1, it is reliable, and No. 2, it emits zero carbon. Carbon reduction is in the best interests of our climate. It is also in the best interests geopolitically of the United States of America, by reducing our dependence on foreign imported oil.

I have offered an amendment to this bill, which has been filed, which is a new nuclear title, which reenergizes the nuclear energy business in the United States, which has basically been dormant since the mid- 1970s while other countries around the world have embraced nuclear energy as the solution to their fossil fuel problem in terms of energy production and electric production. Look at the nation of France. Eighty-seven percent of their electricity is generated by nuclear. They have developed a reprocessing MOX facility that reduces their waste by 90 percent. So they have almost eliminated the waste problem, and they almost have total reliability on nuclear energy.

There is no silver bullet in this challenge of reducing gas prices and reducing our dependence on foreign oil, but there are a lot of bullets we have in our arsenal if we are only willing to put them in the chamber. Nuclear is one of them.

One of the great things Senator Alexander advocated so much is the plug-in car that we know is coming. You can plug it in at night, recharge it, and the next day drive it and use it. At night, we are generating a lot of electric power that goes to waste because everybody is asleep and activity is slow. If you plug your car in at night, you are making good, efficient use of the electricity you are generating and wasting, and you are reducing totally, because you use electricity, dependence on oil.

I say to the distinguished Senator from Tennessee, nuclear energy is a piece of the puzzle--and this is a puzzle. I happen to know the answer to the puzzle. It is all the resources the United States has at its disposal to reduce its importing of foreign oil, increase our conservation, and incentivize production of the energy we know we have within our own capacity and within our own boundaries. I thank the Senator for recognizing nuclear.

Mr. President, in just short of 2 weeks, the Senate will leave for what is the traditional August recess. There is one thing about which every Member of this Senate today agrees upon, not a single dissenting statement from anybody--the largest problem and biggest issue facing the American people today is the rising cost of energy and specifically the high

cost of gasoline. It would be sad and disappointing if this Senate adjourned for a recess in August without having addressed the energy problem in a meaningful, bipartisan, multifaceted way.

In the speech I made on the floor 3 weeks ago, I made the statement that it was time for Republicans and Democrats to put the elephants and the donkeys in the barn. It is time for us to find a way to find common ground, set aside those divided issues, and put on the table those issues which both of us know will help to solve the rapidly increasing price of energy and the long-term problems it portends.

Last Thursday, Senators Bingaman and Domenici brought to the Senate two renowned experts on economics and energy. They testified for over 4 hours in Dirksen room 50. About halfway through that testimony, Senator Conrad of North Dakota posed the following question to both of them. He asked: Gentlemen, if you could, please tell me, where is it America has gone wrong? After pausing for a minute, the economist leaned back and said: For 25 years, the United States has encouraged consumption and discouraged production. We should be encouraging production and discouraging consumption.

The lightbulb went off in my mind. He is exactly right. The policies of this Congress, of our leadership, Republican and Democratic, have looked the other way. We looked the other way when we dodged the bullet of the Arab oil embargo in the 1970s. We forgot about the lines, the shortages, the caps. Somehow, we looked out to another day to solve the problem.

That other day has come. I suggest to you there are multiple things we all agree upon, if we will put our partisanship aside and do it. I encourage the majority leader to allow, when we get to cloture, all amendments to be offered and debate to be open and free-flowing and for us to be willing to put all issues on the table.

Let me begin. S. 3268, the bill before us, deals with speculation. I have read through the bill. I want to commend two parts of it.

No. 1, I commend transparency. Most of us in this body are not familiar with speculation or the speculative markets or commodities. We all need a better education and more facts to get it, and the exchanges ought to have absolute transparency so we know what is going on all the time everywhere.

Secondly, I commend the portion on position limits. I learned the other day--and I believe this is an absolutely accurate statement--that all the users of commodities--airlines that buy futures in petroleum, cereal makers who buy futures in grain--all have position limits, meaning there are limits to which they can speculate.

But did you know who does not have a position limit? The investment bankers on Wall Street. The same people who brought us the subprime crisis by securitizing high-risk loans at high yield are the same people who, in some way or another, have no limit on the positions they can take or offer in the commodities market. I think the position limits ought to be equalized across the board, whether you are a user or a speculator or a Wall Street banker.

So those are both good positions. But that is the only thing the bill addresses--speculation--when there are so many other things we need to do. No. 1, on the production side, we do need to start exploring our own resources. It is true, it will take 10 years to get some of those resources to produce. But the very fact we finally make up our mind to do it will make it 1 day shorter each day we have made up our mind. If we put it off today, it is 10 years from tomorrow before we get the production. We ought to go ahead and get it.

Where we have significant differences--such as ANWR; we can debate that separately--but there are other issues where there should be no debate, either in the OCS or extracting the shale oil in Colorado, North Dakota, and Montana. Conservation, encouraging a savings--we ought to be working to do everything we can to encourage Americans to conserve.

Quite frankly, Americans have already gotten that message. For all the rapid transit, mass transit in my city of Atlanta, the buses are full, with standing room only. So is the subway. Ridership is way up. The traffic is much better because people are starting to find economical ways to travel. We ought to incentivize more and more of that.

We ought to incentivize conservation wherever we can. We also ought to look at those things such as nuclear energy. I know the Presiding Officer today has shared with me the common ground he and I have on a safe, reliable way to produce energy in nuclear. It does not pollute. It does not contribute carbon. It is proven to be reliable around the world.

Mr. President, 19 percent of our energy today comes from nuclear. In 20 years we could take it to 50 percent, and we could reduce our carbon footprint, while geopolitically we could have a tremendously positive effect on our country. Renewable sources of energy should be incentivized across the board, as biofuels should be the same way. We should not have selective encouragement in tax policy. We should have open encouragement on all research and development, whether it is synthetic, renewables, or biofuels.

In essence, I have simply come to the floor to say this: We all know precisely what the problem is. We all know there is not one answer. It is not just speculation. It is not just exploration. It is not just conservation. It is not just wind. It is not just solar. It is not just hybrid vehicles. It is not just plug-in cars. It is all of those things.

But the solution lies in the heart of a Senate that is willing to put its partisanship aside, address the No. 1 issue facing the people of the United States of America, and find a willingness and a heart to find common ground. Our country faces some significant challenges economically today, and whatever our differences may be politically, we should be united in finding common ground to solve those problems, and the biggest is the price of energy to the American family. It is impacting every single thing they do.

So I come to the floor today to welcome the ability to debate this legislation, to want to talk about dealing with speculation--but not speculation alone. We should not make ourselves feel good by passing one bill that deals with one issue and only one component part and go home and say we did something. We should take pride in taking all the facets we can agree on--whatever they might be--incorporating them in a bill, and leave here in August knowing we did something for the people who have sent us up here to represent them, the people of the United States of America.

I yield back the remainder of my time.

I wish to commend the Republican leader on his remarks. I wish to follow up on those remarks on what is the crisis of the day in the United States of America, which is that the Congress of the United States has chosen, all of us--I am not pointing fingers at anyone--to argue about partisan politics over energy while the American people are paying numbers they have never had before in their lives. The future of oil is only looking higher and higher and higher.

Quite frankly, in the United States of America, the Congress of the United States is sitting on a ham sandwich starving to death.

This is a problem we have solutions for, if we will put our partisan differences aside and develop a comprehensive mandatory plan to address the supply and demand on petroleum. Yesterday the President removed the executive order prohibiting offshore drilling. That is absolutely something we ought to do. We need to be exploring our domestic resources to reduce our dependence on foreign imports. It is good for America not only because it is our energy, it is good because it is in the geopolitical interests of the United States. Every barrel of oil we are dependent on from the Middle East is a geopolitical problem, not just an arithmetic problem or a cost-of-oil problem. We should be exploring every resource we have. Some Members of the Senate have come together to realize there are things we can do and things we can't. We should be focusing on the things we can do. For the purposes of my remarks, I want to outline all of those things that are doable today.

No. 1 is offshore exploration with the States and their general assemblies and Governors having the authority to authorize it. We know we have significant offshore resources in terms of both natural gas and petroleum.

Second, we ought to reenergize the nuclear energy business. It is absolutely ridiculous that the most industrialized country in the world, the country that brought nuclear power and nuclear electric generation to reality, now sits on the sidelines while the rest of the world generates safe, carbon-free, inexpensive energy on a daily basis. In the Nation of France, 87 percent of their energy is generated for electricity by nuclear energy. It emits

zero carbon. The French use the MOX system to recycle their spent fuel rods and use them a second time, reducing nuclear waste by 90 percent and getting the maximum use out of the uranium to generate energy.

Synthetic fuels. It is absolutely important that we work as hard as we can to have the tax credit, tax incentive, and depreciation necessary to incentivize companies to rapidly develop synthetic fuels that do not depend on petroleum. Our military has proven this can be done. It is a matter of Congress directing tax policy and research and development to see to it that we do it.

Wind and solar. There are those who say that won't solve our problem. Well, they won't, but they will help. In those States, 40 of them where wind energy actually will produce a significant amount of energy for the grid, we ought to be incentivizing it through tax credits, rapid depreciation, and other procedures that the Congress has the power to do today. Renewable sources of energy, ethanol, both cellulose and corn based, are essential. It has its place. It won't solve the problem, but it will help.

It is very important for us to understand that if this Congress decided to adopt a comprehensive policy to increase the supply of resources for energy, the cost of petroleum would begin coming down immediately, because those who speculate on the future would understand the United States has finally had enough. We are going to develop our resources. We are going to incentivize the private sector, and we will get the job done. This country has accomplished amazing things in difficult times. These are difficult times, but we know what the solutions are, and we know where they lie. They lie domestically with our own production of petroleum. They lie in research and development and ingenuity, and they lie in a Tax Code that needs to incentivize the development of energy.

I wish to share a story that opened my eyes to the importance of exploring our own resources. I am ranking member of the Subcommittee on Africa. Earlier this year I traveled to Djibouti and to Equatorial Guinea. I saw a good example that the people of the United States ought to know about. Equatorial Guinea 10 years ago was the poorest nation in Africa and the poorest nation in the world. Today, it is the seventh fastest growing economy in the world. They came to America and asked American oil companies to come and explore in the Gulf of Guinea to see if they had any gas or any oil. Marathon Oil went over there, along with other smaller companies from Texas, and found gas in the Gulf of Guinea. Ten years later, when you go to Equatorial Guinea and the island of Malbo, and you go to the Marathon plant that liquefies natural gas for shipment around the world to places such as the United States, Russia, wherever it might be needed, you see tanker after tanker after tanker anchored in the Gulf of Guinea, loading up $25 million, the value of a tanker full of liquefied natural gas, to go around the world.

Equatorial Guinea has gone from a country that could not feed itself or take care of its people to a country building hospitals, universities, schools, highways, building the prosperity of their people, all because they had the willingness to explore. From an environmental standpoint, there has been no environmental impact. We know and have learned that we can drill offshore safely and securely and proved we can withstand even the most dangerous of hurricanes as happened in Katrina. There is no excuse for the United States not to be exploring offshore and be exploring today, no reason whatsoever we should not be reenergizing nuclear energy, no reason we should not be working on renewable sources of energy such as wind and solar, no reason we shouldn't expedite the development of synthetic fuels, coal liquefaction, and clean coal technology. America has every resource we need to be energy free, from coal to petroleum. All we to have do is have the political will and common sense to make it happen.

I call on my colleagues, Republicans and Democrats, to put their elephants and donkeys in the barn and look at the needs of the American people, understand if we leave this year without a comprehensive declaration for energy policy and energy independence, we have done a disservice to the people of the United States, and we will not have fulfilled our constitutional responsibility. It is time to get out of the chair, get off the ham sandwich, and understand that we have everything we need here to begin an end to high gas prices, high oil prices, and dependence on the Middle East for foreign oil.

I yield the floor.

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

Mr. President, I rise for a moment to talk about the pending housing stimulus bill which we will vote on tomorrow and then, hopefully, it will quickly be delivered to the House where any differences we have can be worked out and agreed to. I come to talk about this issue because America faces a pending financial crisis that is founded in the housing market, with the troubled mortgages in the financial services sector, so much trouble that the current economic decline we have experienced and the current difficulties the stock market is experiencing are, in large measure, tied to the state of housing.

I commend Senators Shelby and Dodd. I actually thank the distinguished Senator from New York for the help he gave me on the tax credit on this bill.

This bill is not perfect, but it certainly improves tremendously the climate in the United States for housing. For a second I want to try and impress upon my colleagues how important this issue is and dispel some of the myths that have been put out there about this issue. First, unless we pass GSE reform, which means Fannie Mae and Freddie Mac, there is going to be little, if any, liquidity in the conventional mortgage market. This legislation is a good reform piece for Fannie and Freddie. It also provides provisions that will allow for forward commitments so that mortgage companies can make mortgages and fund them through Fannie and Freddie and get housing moving in the marketplace.

Second, it changes the loan limits on conventional and conventional jumbo loans to levels that are reflective of the values of housing.

Third, it provides for a housing tax credit, something I was proud to be a part of. I proved in 1974, the last time we had a crisis like this, that it is the one single thing we can do as a catalytic agent to drive buyers back to the housing market. So the solution is not a bailout but a stimulus to get buyers in there buying the inventory that was built over the last 12 months.

Fourth, there is a significant reform of FHA. Within that provision there is the creation of moneys for the refinance of troubled subprime loans. There has been a lot of misinformation in the news media and misinformation in speeches on this floor, frankly, on whether this is a bailout or whether it is a good thing to do.

For a second I want to explain why it is absolutely not a bailout and why it is absolutely the right thing to do. Any loan that is refinanced, any subprime loan in trouble that is refinanced has to meet the following qualification: Its equity has to be negative, meaning the house is worth less than what is owed against it; No. 2, the lender who holds the loan against that house has to agree to take the discount or take the hit on whatever the differential is in that negative value; No. 3, FHA will underwrite the new loan to refinance out the discounted balance of the loan to the lender, provided the individual is somebody who can qualify to amortize the loan. It forces the lender to take the hit which they are going to take eventually in a foreclosure, and it prevents the foreclosure. For the person in trouble, it gives them a chance to pay back over time and get their credit established and improve themselves and build equity in the house.

Most importantly, it benefits the next-door neighbor. I have heard so many people say we should not be helping somebody in trouble on a subprime loan. What do we say to the people who are making their payments and are not in trouble? The answer is, in most neighborhoods today where there is a foreclosure, values are going down, not up. You have John Q. Public who has made the monthly payments, has good credit. The house next door to him is foreclosed on. The grass grows. The lender sells at a deep discount. What happens, his equity is gone or is greatly reduced.

The combination of the housing stimulus in terms of the tax credit, combined with the ability to refinance out of the difficult subprime loan and the requirement that the lender take the deep discount they are going to ultimately have to recognize anyway, is a formula for rebuilding the housing market.

I know everybody here has a difficulty. There was one amendment--we will not be allowed any amendments--that I was very interested in offering in terms of the tax package. But I know the tree is filled up. There will be a managers' amendment. We will not be able to get to it. But you don't get everything you want in the Senate.

One thing we have to do is to improve the plight of the American people economically. There are two things overriding the average American and two things only: One is what they are paying at the pump for gasoline and, secondly, is the declining value of equity in their house. With passage of this bill, we can show hope for the housing market. We may stimulate the buying public to come back and solve it with good marketplace-based solutions rather than subsidies or a bailout and, most importantly, return to a more healthy mortgage market and a more disciplined mortgage market and a better underwritten mortgage market. Then secondly and most importantly, we can change attitudes. The attitudes of the buying public are pretty negative right now because the lenders can't make a loan. House values are going down. They want to buy, but they want to buy at the bottom. We have to send a signal that the lenders are back in business making loans. Freddie Mac and Fannie Mae are back in business in terms of securitizing mortgage money and putting liquidity into the market, and values are stabilizing. So for whatever differences some Members have over the bill they would like to have versus the bill we do have, we should be reminded that every day we wait is a protraction of the current economic difficulty in the housing market. We cannot afford to leave this week without agreeing to the motion tomorrow and sending it to the House so the House, when they come back next week, can pass the legislation and the President can sign it and, by the middle to the end of July, the mortgage market, the housing market, and the buying public's attitude will be turned around. By doing that, we can hopefully have a light at the end of the tunnel that is not a locomotive but, rather, is a prosperous, healthy housing market and a disciplined, well capitalized, and liquid mortgage market.

It is critical that we pass this legislation. I urge my fellow Senators to come to the floor, vote for the motion, and then let us get it to the House and encourage House Members to do precisely the same thing. It is getting too late. If we wait too long, it won't matter what we do.

I yield the floor.