Senate Proceeding on Jul 26th, 2008 :: 1:38:14 to 1:46:31
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1:30:01 to 1:38:14( Edit History Discussion )
Speech By: Christopher Dodd

1:38:02 to 1:38:14( Edit History Discussion )

Christopher Dodd: i tip my hat. you're a good man to work with. and i thank senator shelby. mr. shelby: mr. president? the presiding officer: the senator from alabama. mr. shelby: mr. president, i rise this morning to

1:38:14 to 1:38:28( Edit History Discussion )

Richard Shelby: speak in support of the final passage of h.r. 3221, the legislation before us that senator dodd has been, and others have been talking about. this legislation, mr. president, contains numerous provisions

1:38:14 to 1:46:31( Edit History Discussion )
Speech By: Richard Shelby

1:38:28 to 1:38:40( Edit History Discussion )

Richard Shelby: that address a wide variety of issues associated with the housing crisis. many of them, in fact, were previously considered and passed by the senate in earlier versions of this bill right here on the

1:38:40 to 1:38:54( Edit History Discussion )

Richard Shelby: floor. mr. president, i would like to highlight just a few of these important provisions now. mr. president, as you well know, because you're a very important player in this and a very important member

1:38:54 to 1:39:10( Edit History Discussion )

Richard Shelby: of the banking committee, this final package contains the same mortgage refinance program including in the earlier bills. this is temporary, a temporary voluntary program within the federal housing administration

1:39:10 to 1:39:25( Edit History Discussion )

Richard Shelby: to back f.h.a.-insured mortgages to distressed borrowers. it requires both mortgage lenders a borrowers to give up some of their financial interests in order to participate. the mortgage lender must agree

1:39:25 to 1:39:40( Edit History Discussion )

Richard Shelby: to reduce are the principal balance of the loan, which we also call a haircut. the loan refinancing arrangement must also bring the loan to value, the l.t.v., ratio on the new loan to no greater than

1:39:40 to 1:39:53( Edit History Discussion )

Richard Shelby: 90% of the property's current appraised value. borrowers must accept an equity sharing requirement and forego percentage -- a percentage of any future profits on the sale of their homes. while i would

1:39:53 to 1:40:09( Edit History Discussion )

Richard Shelby: prefer, mr. president, a completely free market solution, at least this program is designed to keep the taxpayer from bearing the cost, something that i fought hard for in the banking committee. we've

1:40:09 to 1:40:23( Edit History Discussion )

Richard Shelby: included a separate funding stream that carries on in perpetuity to cover any costs that may arise. this package also includes measures which modernize the f.h.a. program. but by streamlining and expanding

1:40:23 to 1:40:39( Edit History Discussion )

Richard Shelby: it, we hope the program can make safe fix-rate mortgages more readily available to homeowners in the united states of america. the legislation, mr. president, awes know, also includes a first-time home buyer

1:40:39 to 1:40:51( Edit History Discussion )

Richard Shelby: tax credit of $7,500. i believe that this should serve as an additional incentive to potential first-time buyers who may be waiting to purchase a home. the tax credit, mr. president, combined with a greater availability

1:40:51 to 1:41:04( Edit History Discussion )

Richard Shelby: of sustainable mortgages should encourage buyers and help invigorate, reinvigorate the housing market in this country. mr. president, while i support this bill, there are a number of provisions in this

1:41:04 to 1:41:17( Edit History Discussion )

Richard Shelby: legislation with which i'm very concerned. if it had been my decision alone, i would not have included them. while crafting legislation requires a great deal of give-and-take, one thing we should not

1:41:17 to 1:41:32( Edit History Discussion )

Richard Shelby: compromise is our obligation to conduct continuing oversight of the programs that we enact. our responsibility in the senate to the taxpayers require, i believe, that we continue to closely track

1:41:32 to 1:41:45( Edit History Discussion )

Richard Shelby: the funds we're providing. we should not tolerate the waste or misuse of a single tax dollar. it's my hope, mr. president, that my friends who demanded additional spending are as enthusiastic about accounting

1:41:45 to 1:42:00( Edit History Discussion )

Richard Shelby: for tax dollars as they are about spending them. mr. president, the bill coming back to us from the house does contain a set of entirely new and significant provisions. these provisions were added

1:42:00 to 1:42:12( Edit History Discussion )

Richard Shelby: at the request of treasury secretary paulson who determined that such measures were needed immediately as a result of the rapidly deteriorating financial condition of fannie mae and freddie mac.

1:42:12 to 1:42:24( Edit History Discussion )

Richard Shelby: the legislation provides, as the president knows, the secretary with temporary authority to purchase debt or equity of the g.s.e.'s when he, the secretary, determines that such action is required

1:42:24 to 1:42:37( Edit History Discussion )

Richard Shelby: to stabilize the financial system, protect taxpayers, and prevent disruptions to the mortgage markets. mr. president, i recognize the unprecedented nature of the authority this legislation provides

1:42:37 to 1:42:51( Edit History Discussion )

Richard Shelby: to the secretary of the treasury. it is not something i agreed to without a great deal of consideration. in my estimation, however, the risk of not providing the authority ultimately outweighed the

1:42:51 to 1:43:08( Edit History Discussion )

Richard Shelby: risk of extending it.| i fear that we are sitting on a financial powder keg. i think a lot of people realize that. fannie mae and freddie mac independently and together represent considerable risk

1:43:08 to 1:43:26( Edit History Discussion )

Richard Shelby: to the financial system. they each hold portfolios in excess of $700 billion. they each guarantee more than $2.5 trillion in mortgages. their debt is held as regulatory capital by hundreds to not thousands

1:43:26 to 1:43:41( Edit History Discussion )

Richard Shelby: of american financial institutions. they serve as counter parties on derivative contracts with hundreds of firms domestically and abroad with trillions. four years i have argued on the banking committee

1:43:41 to 1:43:55( Edit History Discussion )

Richard Shelby: these entities, because of their size, and their reach in the terrible market, pose a risk to the global financial system. i've also argued that such systematic risk requires the appropriate regulatory trimork

1:43:55 to 1:44:11( Edit History Discussion )

Richard Shelby: to prevent total financial calamity should one of the firms face a crisis. unfortunately, over the years my calls for regulatory change were not only unheeded but were rebuffed. consequently, we

1:44:11 to 1:44:26( Edit History Discussion )

Richard Shelby: were denies the chance to put a strong regulator in place when it could have made a difference. but we're where we are now today. what has happened in the meantime seeps seems the result our far

1:44:26 to 1:44:39( Edit History Discussion )

Richard Shelby: failure to act. when it became clear both of the g.s.e.'s were on dangerous financial ground it was no surprise the secretary asked for such power. entities of such size can only be helped by the

1:44:39 to 1:44:52( Edit History Discussion )

Richard Shelby: commitment of a massive amount of resources. upon the passage of this bill, mr. president, such resources will be available, if necessary. and i hope they won't be necessary. mr. president, it's unfortunate

1:44:52 to 1:45:06( Edit History Discussion )

Richard Shelby: that it took the near collapse of fannie mae and freddie mac to convince a number of my colleagues that these entities do, indeed, post a systematic risk to the u.s. and global economies. nevertheless,

1:45:06 to 1:45:20( Edit History Discussion )

Richard Shelby: i'm pleased this legislation now acknowledges and addresses that reality in statute by giving the federal reserve a role in advising the new regulator on risk to our financial system. although the

1:45:20 to 1:45:34( Edit History Discussion )

Richard Shelby: fed's role as the president knows is temporary, it is now well established that the systematic risk the g.s.e.'s pose are permanent. that debate is basically over. the only question new is to whom the congress

1:45:34 to 1:45:47( Edit History Discussion )

Richard Shelby: assigns that responsibility in 18 months. since beginning the process of developing this legislation i have believed that the most important aspect of the bill is it establish a strong independent regulator

1:45:47 to 1:46:01( Edit History Discussion )

Richard Shelby: for the g.s.e.'s. intervening events have further confirmed this belief. we have provided the new regulator with enhanced powers and additional authority so it has the tools necessary to ensure

1:46:01 to 1:46:19( Edit History Discussion )

Richard Shelby: the g.s.e.'s are properly regulated. in doing so i believe we're taking a very important step to prevent a repeat of the crisis that enveloped fannie mae and freddie mac. we find ourselves at the end

1:46:19 to 1:46:31( Edit History Discussion )

Richard Shelby: of a road and the time for the debate is ended. it is now time to vote.e. the presiding officer: the majority leader. reid mr. reid: it's my understanding the minority has two minutes? the presiding

1:46:31 to 1:46:53( Edit History Discussion )

Harry Reid: officer: that is right. mr. reid: you intend to use that? mr. shelby: i yield it back. mr. reid: on our side we have one minute plus my time? the presiding officer: 54 seconds and your time. mr. reid:

1:46:31 to 1:57:39( Edit History Discussion )
Speech By: Harry Reid