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Senate Proceeding on May 11th, 2009 :: 1:12:40 to 1:25:40
Total video length: 3 hours 12 minutes Stream Tools: Stream Overview | Edit Time

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Jeff Sessions

1:12:39 to 1:13:01( Edit History Discussion )

Jeff Sessions: quorum call: the presiding officer: the senator from alabama. mr. sessions: i the quorum call be dispensed with. the presiding officer: without objection. mr. sessions: mr. president, i'd like to briefly discuss an issue that i think is and at one time it would have probably been worthy of front-page news articles around the country.

Jeff Sessions

1:12:40 to 1:25:40( Edit History Discussion )
Speech By: Jeff Sessions

Jeff Sessions

1:13:02 to 1:13:26( Edit History Discussion )

Jeff Sessions: instead, i notice another piece of news in the middle of the paper. last friday mr. steven friedman announced his resignation effectively immediately as chairman of the federal reserve bank of new york, the considered federal reserve bank in the country, the one that now secretary geithner used to chair.

Jeff Sessions

1:13:28 to 1:13:48( Edit History Discussion )

Jeff Sessions: as chairman of the -- mr. friedman stepped down only after a "wall street journal" story questioned his ties to goldman socks, the banking institution, at the same time thate was serving on the new york fed's board. unfortunately, the bad judgment is just another example in a long line of examples

Jeff Sessions

1:13:49 to 1:14:09( Edit History Discussion )

Jeff Sessions: demonstrating the tangled web we have weaved in allowing so prominent a government role in private businesses involving hundreds of billions of dollars. so let me read monday, may 4. "the federal reserve bank of new york" -- and i'm quoting --

Jeff Sessions

1:14:10 to 1:14:30( Edit History Discussion )

Jeff Sessions: "shaped washington's response to the financial crisis last which buoyed goldman sachs and other wall street firms. goldman received speedy approval to become a bank holding company in september of last year and a $10 billion capital injection

Jeff Sessions

1:14:31 to 1:14:52( Edit History Discussion )

Jeff Sessions: soon thereafter." close quote. that's $10 billion capital injection after they redefined themselves as a bank holding company. prior to that, they weren't eligible. it goes on to say, "during that time, the new york fed's chairman steven friedman, sat on

Jeff Sessions

1:14:53 to 1:15:13( Edit History Discussion )

Jeff Sessions: goldman's board and h a large holding which because of goldman's new status, not previously" -- but i'm quoting -- "but because of goldman's new status as a bank holding company was a violation of federal reserve policy.

Jeff Sessions

1:15:14 to 1:15:35( Edit History Discussion )

Jeff Sessions: the new york fed asked for a waiver, which after about two and a half months, the fed granted. while it was weighing the request, 37,300 more goldman shares in december. they've since risen $1.7 million

Jeff Sessions

1:15:36 to 1:15:56( Edit History Discussion )

Jeff Sessions: in value." so, this is a troubling thing. i mean, we can't go out -- me lobbyist can't buy our lunch. this man can be on a board, buy stock while he's asking for approval to

Jeff Sessions

1:15:57 to 1:16:18( Edit History Discussion )

Jeff Sessions: wants to do, and they eventually gi continues to buy stock. and it goes up in value $1. million. now, according to the article -- quote -- "mr. friedman says he checked with a goldman lawyer." he wants to fin can do this or not.

Jeff Sessions

1:16:19 to 1:16:40( Edit History Discussion )

Jeff Sessions: he doesn't check with the fed lawyers. he che lawyer to make sure there was no timing issue with such a purchase. he says he didn't check with the fed. new york fed lawyers say they didn't learn about his purchase until the "wall street journal" raised questions about him in april.

Jeff Sessions

1:16:41 to 1:17:02( Edit History Discussion )

Jeff Sessions: the article goes on to say that "the day after receiving the waiver, mr. friedman purchased 15,300 more shares of goldman. that $1 million purchase brought his holdings to 98,600 shares

Jeff Sessions

1:17:03 to 1:17:24( Edit History Discussion )

Jeff Sessions: according to filings." well, i find this unacceptable behavior really. there is a reason the federal reserve has a policy prohibiting a director of any regional fed bank from having any connections with regulated financial institutions. you do not want the regulator to

Jeff Sessions

1:17:25 to 1:17:46( Edit History Discussion )

Jeff Sessions: have a persona financial interest in those regulated. i appreciate mr. friedman doing the right thing now and resigning. that's a good thing. however, too many officials, i think, have been acting in a way

Jeff Sessions

1:17:47 to 1:18:08( Edit History Discussion )

Jeff Sessions: that suggests a just erosion of propriety and the separation of interest. just recently we learned from the new york attorney general that the government -- that government officials may have threatened the bank of america c.e.o. ken lewis to continue with a merger with merrill lynch or lose his job.

Jeff Sessions

1:18:09 to 1:18:29( Edit History Discussion )

Jeff Sessions: after he figured out it was going to be very bad for his stockholders and indicated he was going to not go it, they told him they would fire him if he didn't go through with it. some of the stories are unclear now about how but the issue does remain.

Jeff Sessions

1:18:30 to 1:18:53( Edit History Discussion )

Jeff Sessions: so i will be interested to see what more we learn about this troubling matter when the house committee on oversight and government reform holds a hearing with mr. lewis and top government officials who will testify under oath. since last year when then secretary paulson told us that we must act or the economy would

Jeff Sessions

1:18:54 to 1:19:14( Edit History Discussion )

Jeff Sessions: go into collapse, most dire warnings repeatedly, we have seen more and more of these instances of impropriety, i think, there are the tarp, the $700 billion bailout, a blank check with no accountability was given to the government to do

Jeff Sessions

1:19:15 to 1:19:35( Edit History Discussion )

Jeff Sessions: basically as it pleased. the secretary of treasury,nd he met in private with many of these banks. many of them were people that he knew and were friends with with and buddies with. and he started allocating this

Jeff Sessions

1:19:36 to 1:19:56( Edit History Discussion )

Jeff Sessions: $700 billion. it's continued now under mr. geithner who previously was chair of the tprefrbg bank of new york -- of the feder reserve bank of new york. last month neil barofsky, the special inspector general overseeing this bailout, issued a report stating

Jeff Sessions

1:19:57 to 1:20:18( Edit History Discussion )

Jeff Sessions: that he has opened 20 criminal investigations and 6 audits into whether tax dollars are being misused or wasted. so i think history where the line between government and free enterprise has become muddled more than ever. during good tim particularly during times like

Jeff Sessions

1:20:19 to 1:20:41( Edit History Discussion )

Jeff Sessions: today, the american system of capitalism and free enterprise should not be manulated for the benefit of insiders. we expect the people who are setting policy to be independent and above that kind of thi and i would just note that

Jeff Sessions

1:20:42 to 1:21:03( Edit History Discussion )

Jeff Sessions: reports concerning how the a.i.g. bailout was handled remain unchallenged, i think. and this is what the reports indicated, that mr. paulson, who was secretary of the treasury of the united states, who had been the c.e.o. of goldman sachs, was

Jeff Sessions

1:21:04 to 1:21:25( Edit History Discussion )

Jeff Sessions: in and out important meeting involvi the insurance company a.i.g. currently in that meeting, as i recall, was

Jeff Sessions

1:21:26 to 1:21:46( Edit History Discussion )

Jeff Sessions: was also from goldman sachs. i believe the chairman of the fed was in that meeting too. and but who else was in that meeting? the chairman of the board of goldman sachs, the immediate chairman at that time. and they were talking about, okay, an insurance company,

Jeff Sessions

1:21:47 to 1:22:08( Edit History Discussion )

Jeff Sessions: a.i.g. and they decided to pump $80 billion into that company. now we've pumped $170 in. but at that meeting, as i recall the stories, that was the amount of money that was put out. and, of course, we now know that of the money that went to

Jeff Sessions

1:22:09 to 1:22:30( Edit History Discussion )

Jeff Sessions: a.i.g., $20 billion went t goldman sachs. so these are the kind of things that are causing me great difficulty. i'm a lawyer. i know to work. when you ask for money, you raise your hand under oath, people ought to be asking you questions. if you're in bankruptcy, you have to be cross-examined by

Jeff Sessions

1:22:31 to 1:22:51( Edit History Discussion )

Jeff Sessions: lawyers, a judge gets to ask questions. you have to submit certified financial statements w-f you get money -- statements before you get m so they j decide it's an emergency, and now we can just pass out hundreds of billions of dollars without the kind of accountability that i think is necessary. and i would jus

Jeff Sessions

1:22:52 to 1:23:12( Edit History Discussion )

Jeff Sessions: colleagues in the senate, when we passed the tarp bill, i opposed it and i too much of a grant of power one man, the secretary of treasury, to allocate mon congress should be appropriated. and -- congress should be appropriating.

Jeff Sessions

1:23:13 to 1:23:34( Edit History Discussion )

Jeff Sessions: i raised that point and it was one of my top objections. and i believe history has shown that the language in that bill was even thought because originally we were told the money would be used to buy toxic mortgages from banks that were in trouble. and that's wt mr. paulson told us, and that's what everybody

Jeff Sessions

1:23:35 to 1:23:57( Edit History Discussion )

Jeff Sessions: thought they were voting on if they accepted -- the language was much broader than that, if anybody took it. as soon as he got the money, within a week or so, he had decided not to buy toxic assets to, buy stocks in the banks. he bought

Jeff Sessions

1:23:58 to 1:24:19( Edit History Discussion )

Jeff Sessions: pretty soon he was buying stocks in an insurance company, a.i.g., pumping hal insurance company and $40 billion of that money that went into a.i.g. went to foreign banks to pay the claims that those banks had against a.i.g., and just like it did for other banks.

Jeff Sessions

1:24:20 to 1:24:40( Edit History Discussion )

Jeff Sessions: then we became -- the taxpayers became the guarantor of an insurance company's responsibilities, which was never or the house or the american people. they just did it. and the amount of money was tremendous they committed. now -- i believe $170 billion whereas the federal highway

Jeff Sessions

1:24:41 to 1:25:01( Edit History Discussion )

Jeff Sessions: budget for the whole united states is just $40 billion. the education budget for the united states of america federal government is $100 billion. so i don't like i'm seeing too many stories like this one, involving mr. friedman. it's time for congress to get serious about it. i hope that the obama

Jeff Sessions

1:25:02 to 1:25:23( Edit History Discussion )

Jeff Sessions: administration will stand up and be counted. mr. friedman came in, i believe, under the bush administration. so i'm but it's time for the obama administration to stand up too. but mr. geithner was in the middle of most of this. he was in this meeting over a.i.g. taorbgs if i didn't

Jeff Sessions

1:25:24 to 1:25:42( Edit History Discussion )

Jeff Sessions: mention it, as president of the federal reserve bank of new york. he helped write the proposal and was what many calls the brains behind the paulson proposal, the $700illion bail skwroufplt is is a continuing problem in both administrations. it's time for congress to reassert its constitutional

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