Daily Archives: September 29, 2008

Pelosi: The Great Depression, "I don’t know what was so great about the depression"

“But that’s the name they give it.”

She actually said this in her speech on the House Floor this morning. Can she really be that dumb?

H/T: Quintas Arias

Barney Frank gave up his last one minute for the Speaker.

Thank you very much Madame Speaker for recognizing me and also to the distinguished chairman for his extraordinary leadership which I’ll address in a moment.

Madame Speaker, when was the last time that anyone ever asked you for seven hundred billion dollars? It’s a staggering figure. And many questions have arisen from that request. We have been hearing, I think, a very informed debate on all sides of this issue here today. I’m proud of the debate.

Seven hundred billion dollars. A staggering number. But only a part of the cost of the failed Bush economic policies to our country. Policies that were built on budget recklessness. When President Bush took office, he inherited President Clinton’s surpluses. Four years in a row, budget surpluses on a trajectory of 5.6 trillion dollars in surplus. And with his reckless economic policies within two years he had turned that around and now eight years later the foundation of that fiscal irresponsibility combined with an “anything goes” economic policy has taken us to where we are today. They claim to be free market advocates, when it’s really an anything goes mentality. No regulation. No supervision.  No discipline. And if you fail you will have a golden parachute and the taxpayer will bail you out.  Those days are over. The party is over in that respect.

Democrats believe in a free market.  We know that it can create jobs, it can create wealth, it can create, uh, many good things in our economy. But in this case, in its unbridled form, as encouraged, supported by the Republicans – some in the Republican party, not all – it has created not just, not jobs, not create capital, it has created chaos. And it’s that chaos that the Secretary of the Treasury and the Chairman of the Fed came to came to see us, just about a week and a half ago. Seems like an eternity doesn’t it? So much has happened and the news was so bad. They described a very, very dismal situation. A dismal situation describing the state of our economy, the fragility of our financial institutions, and the instability of our markets, our equity markets, our credit markets, our bond markets.

And here we were listening to people who knew of what they spoke.  Secretary of the Treasury brings long credentials and knowledge of the markets. More fearful though, to me, more scary was the, were the statements of Chairman Bernanke, because Chairman Bernanke is probably one of the foremost authorities in America on the subject of The Great Depression. I don’t know what was so great about the depression, but that’s the name they give it. And we heard the Secretary and the Chairman tell us that this was a once in a hundred years phenomenon, this fiscal crisis was so drastic. Certainly once in the fifty years, probably once in a hundred years. And how did it sneak up on us so silently? Almost on little cat’s feet. That they would come in on that day and, and they didn’t actually ask for the money, that much money, that night.

It took two days until we heard, saw, the legislation that they were proposing to help calm the markets. And that was on that day that we learned of a seven hundred billion dollar request. It wasn’t just the money that was alarming, it was the nature of the legislation. It gave the Secretary of the Treasury czar like powers, unlimited powers, latitude to do all kinds of things and specifically prohibited judicial review or review of any other Federal administrative agency to review their actions.

Another aspect of it that was alarming is it gave the Secretary [some digital interference] these infusions of cash to be used at the discretion [end of video one]

[digital interference] almost arrogant and insulting. The American people responded almost immediately. Overwhelmingly they said they know that something needs to be done, say 78 percent of the American people says Congress must act. 58 some percent said but not to accept the Bush proposal. And so here we are today a week later and a couple of days later and coming to the floor with a product that, not a bill that I would have written, one that has major disappointments with me, beginning with the fact that it does not have bankruptcy in this bill and we will continue to persist and work to achieve that.

It’s interesting though to me that when they describe this, the magnitude of the challenge and the precipice that we were on and how we had to act quickly and we had to act boldly and and we had to act now that it never ocurred to them that the set, consequences of this market were being felt well in advance by the American people. Unemployment is up and therefore we need unemployment insurance. The jobs are lacking and therefore we need a stimulus package. So how can, on the one hand could this be so urgent at the moment and yet so unnecessary for us to address the effects of this poor economy on the households of Americans across our country. We’ll come back to that in a moment.

Working together, we, um,  put together some standards and I am really proud of what Barney Frank did in this regard. The first night, that night, that Thursday night, when we got the very, very dismal news he immediately said if we’re going to do this – Spencer Bachus was in this as well – if we’re going to do this, we must have equity for the American people. We’re putting up $700 million we want the American people to get some of the up-side. So equity – fairness for the American people. Secondly, if they were describing the root of the problem as the mortgage backed securities, Barney insisted that we would have forebearance on foreclosure of those if we’re now going to own that paper that we would then have forbearance to help responsible homeowners stay in their home.  In addition to that we have to have strong, strong, oversight. We didn’t even have to see the $700 billion or the full extent of their bill to know that we needed equity and up-sides for the taxpayer, forbearance for the homeowner, oversight of the government on what they were doing, and something that the American people understand full well. An end to the golden parachutes and a review and reform of the compensation for CEO’s.

Let’s get this straight, we have a situation where on Wall Street people are flying high, they’re making unconscionable amounts of money. They make a lot of money, they privatize the gain, the minute things go tough {snaps fingers} they nationalize the risk. They get a golden parachute as they drive their firm into the ground and the American people have to pick up the tab. Something is very, very wrong with this tip. So just on first blush, that Thursday night, we made it clear, meeting much resistance on the part of the administration, that those four things, equity, forbearance, oversight, and reform of compensation.  Overall, over riding all of this, is the protection of the taxpayer. We need to stabilize the markets, and doing so we need to protect the taxpayer. And that’s why I’m so glad that this bill contains the a suggestion made by Mr. Tenner, that if at the end of the day, say in five years, when we can take a review of the success or whatever of this initiative, that if there is a shortfall, we don’t get our whole $700 billion back that we have invested. That there will be an initiative to have the financial institutions that benefit from this program to make up that shortfall, but not one penny of this should be carried by the American people.

People ask, and Mr. uh, Mr.  Sprague(?) spoke with great knowledge and eloquence on aspects of the budget. Seven hundred billion dollars. What is the impact, what is the opportunity cost for our country of the investments that we would want to make? Okay, now we have it in place, for the taxpayers to be made whole and that was very important for us. But why on the {snaps fingers} drop of a hat, can they ask us for $700 billion dollars and we couldn’t get any support from the administration on a stimulus package that would also help grow the economy. People tell me all over the world that the biggest emerging market, economic market in the world is rebuilding the infrastructure of America. Roads, bridges, waterways, water systems in addition to waterways, the grid, um, broadband, schools, housing, certain schools. We’re trillions of dollars in deficit, we know what we need to do to do it in a fiscally sound way that creates good paying jobs in America immediately brings money into the Treasury by doing so and again does all of this in an all American way. Good paying jobs here in America. We can’t get the time of day for $25-$35 billion for that which we know guarantees jobs, etc, but $700 billion.

So make no mistake, when this Congress adjourns today to observe Rosh Hashanah and have members go home for a bit, we are doing so at the call of the Chair. Because this subject is not over. This discussion about how we saved our economy. And we must insulate Main Street from Wall Street. And as Congresswoman Waters said, Martin Luther King Drive, in my district, Martin Luther King Drive and Cesar Chavez Road and all of the manifestations of community and small businesses in our community. We must insulate them from that and so we have difficult choices so many of the things that we said on both sides of this issue in terms of this criticism of the bill we have and the bill we had at first and the very size of this I share. You want to go home so I’m not going to list all of my concerns and I have those. It just comes down to one simple thing, they have described a precipice, we are on the brink of doing something that might pull us back from that precipice.

Monday Morning Musings

Camping. With the Cub Scouts. That’s what we did this weekend.

It was actually pretty fun. Of course, the air mattress and down comforter were a plus. The weather favored us, no rain. Mosquitos abounded but weren’t too bad after a little Deep Woods Off.

On Saturday we all went to an apple orchard and went apple picking in the afternoon. Then we went next door to a smokehouse and cider place. The boys got to play on a big pile of hale bales and we got to do a little petting zoo action with pygmy goats and sheep. They also had some turkeys and geese. One of the turkeys came over for some food and when a child put the cup of food through the fence, the turkey took the entire cup right out of his hand.

The freshly pressed apple cider was delicious. The apple cobbler we baked next to the fire was excellent and the apple doughnuts (freshly made at the smoke house the day before) were just wonderful for breakfast in the morning. They went well with the cranberry pomegranite green tea we drank each morning.