the committee will be in order please take your conversations off the house floor the committee will be in order union calendar number eighty four h r fourteen twenty seven a bill to reform the regulation of certain housing related government sponsored and your enterprises and for other purposes pursuant to the rules of the bill is considered read the first time the gentleman from massachusetts mr frank and the gentleman from alabama mr baucus h will control thirty minutes here recognizes the gentleman from massachusetts  the committee will come to order will the gentleman suspend while members take their conversations off the house floor the committee will come to order the gentleman from massachusetts is recognized mr chairman i want to begin by again asking the indulgence of the house for my best than usual suck tauriel splendor but the cast on my left arm would miss  line my jacket and i wouldn't want to wear a suit unless i could do it full justice so i am wearing a sweater that mr rogers no longer need the bill before us today is  green of a bill that came before this house in october of two thousand and five after a lot of work by the former chairman the general while mr oxley and many of us now on the committee that bill passed the house by a vote of three hundred thirty nine t many of those who vote in opposition myself included were motivated to do it by a specific provision regarding the affordable housing fund is no longer in the bill so very large number member first it significantly increases the strength of the regulator of the two major federal housing government spondon apprises fannie mae and freddie mac it also deals with the increase public participation in that system but this is a bill fundamentally about fannie mae and freddie mac there is general agreement among a wide range your party that this bill building on the bill that mr oxley brought to the floor does do agreed in fact this is a bill which with regard to regulation and the regulator is a little bit stronger than the one we passed a few years ago we had some negotiations they were useful and we have a fully empowered also in the bill when it last passed and that is in affordable housing fun a number of people have argued over the years that fannie mae and freddie mac received from the federal government advantage which helped them borrow money cheaply in the market and that's true there is a connection between fannie mae and freddie macin the federal government those who borrow that money thinking that the federal government guarantees it are wrong there is no federal guarantee implicit explicit or any other way but it is the case that the market does c d s entities in a very favorable eye and lend them money at our someone over a can other entities could borrow the reason for this having been set up that way was to try to help housing especially homeownership because these people these entities buy the mortgages and help bring down the cost of mortgages but they have also been given for years goals by the law where they are particular to help lower income housing now a number of people have argued over the years that fannie mae and freddie mac shareholders and in the past some of their executives received to argue share those benefits the argument was with some accuracy alternative way you can do what this bill does leave the existing situation which provides a benefit to them but increase the cure of those benefits that go for public purposes we do that two ways in this bill first of all and this is not appear to be terribly controversial fannie mae and freddie mac have statutorily imposed goals some people have said you know these a private corporation shouldn't tell me what to do what we've been doing that for a very long time they are told that they must in purchasing mortgages in the secondary market make shirton purchases that help certain goals low income housing etc we increase those goals secretary jackson at hud had been critical of them for not doing enough we increased both the mechanism by which they held those goals and the goals themselves but the newly controversial element to this is an affordable housing fun i say newly controversial because an affordable housing fund virtually identical to this one finance through a different formula but essentially the same in the amount of money and as a function was in the bill that passed the house and october of two thousand and five at that time the republicans in the house voted for two hundred nine to fifteen now members having once had an opinion are not required to hold it forever but i do know that in october of two thousand and five two hundred nine republicans voted for the bill that had an affordable housing fund now some of argued that it's going to raise the cost of mortgages but ironically many of those who argue that this will raise because their mortgages have supported even greater restrictions on fannie mae and freddie mac particularly by women in their portfolios which would have many many if it's and says it will be huge for the construction of affordable housing we have a serious crisis in america and a lack of affordable housing we have been dealing with this for years by valve has value to add to the demand for housing but an annual voucher cannot create new housing it does not add to the supply we have a mechanism here where without impinging on the federal budget without adding a penny to the deficit in an entirely self paid way we take some money from fannie and freddie which reflects some of the benefit they get in the federal arrangements and we recycle it into affordable housing in the first year all of that money maybe five hundred million dollars will go to always yet in mississippi under this bill to a place the severe destruction of housing that has not yet been replaced a year and a half after the terrible hurricane there for the future the bill says it could be used for affordable housing annually but it leads to a later decision by this house and the senate i say optimistically hoping that we could get a decision from the senate and then to be signed by the president as to how further distributed it creates the concept of an affordable housing fun but we had in our committee various arguments some people wanted to go through hud some through the federal through the state how do you see i believe that is a decision that we should make collectively first in our committee and then on the floor but we are not here doing anything other than saying the money will be available for a subsequent  further tighten up huge for the fun and i believe we will have accomplished that the question then will be given that fannie and freddie get very great benefits from the federal government given that we have a housing shortage and a budget crunch in this country does it make sense to take seven hundred million dollars of the profits of fannie and freddie which are enhanced by their federal regulations and rules and make them available for affordable housing i believe the answer should be yes virtually every entity involved with housing in america from low income housing advocates to the nonprofit milledge group to help build housing to the home builders and the real dude in the mortgage bankers all support the notion of beginning to get the federal government back in the business of trying to do some affordable housing i hope that we can go forward the bill i do not we have thirty six amendments a couple i believe will be will non germane nine or ten i hope will be accepted without any controversy ga including about five from each party i did note that many of the others about eighteen of the others are various ways of accomplishing three essential goals making sure that if we go immigrants don't get the housing decision we made about affordable housing i believe many of the other huge house people who voted on i don't think there's a lot of controversy we do have an important but jim and philosophical discussion about affordable housing i'm hoping that between us we can structure things so i have a was a consensus and that's good on other issues and this legislation we parted company we had disagreements that was  bad there were all one or two occasions where we had strong disagreements let's first talk about the things we agree as a body both republicans and democrats i think we all agree that the government sponsored entities fannie my freddie mac federal home loan banks that they play an important role and the american economy and more importantly and more specifically and home ownership home ownership in america is at an all time high you go to any country in the world and homeownership rates come nowhere near what they are in america and i think it was a legislation that this congress many many years ago american dream now in recent years the growth of our government sponsored entities has been astounding in fact let me give you  hree figures and if you hear nothing else that i say out here today and support of establishing a strong independent regulator over these entities it is this fact fannie mae and freddie mac excluding the federal home loan banks but those two entities  three trillion not billion three trillion dollars worth of debt when you add mortgage backed securities obligations it's five point two trillion dollars now you might say well what is five point two trillion dollars i can't visualize that and i don't know any of us that could get our arms around that i'm not sure any of us appreciate how big that is but let me compare it to the public debt held by the u s treasury the entire our public debt of the u s treasury is four point that's an astounding number and so we came together both in two thousand and five and again this year and we said we must establish a strong independent regulator with power to make changes and oversight and if necessary for bit to ever be the case that these entities became a liquid to step in and prevent what would be in either occasion a devastating blow to the u s economy in two thousand and five we brought a bill to the f we passed a bill establishing a strong regulator now the chairman has pointed out that many of those many of us that this is almost the same bill that we had in two thousand and five yet many republicans who are going to vote no today voted yes then that's that appears to be a contradiction he's pointed that out the lady from california has mentioned two years ago the ranking member mas i was into the port of the bill that came out of this floor i voted to send it to the senate that pointed out there earlier today and debate on the road that the gentleman from texas mr sessions he voted for the bill now he's voting against the bill there are differences now the gentleman from massachusetts says there's no differences if you're voting against the bill today why did you vote for it two years ago he asked that question a few minutes ago why did we why did we vote against it i want to we vote for two years ago and vote against it today different circumstances two years ago i will remind the general the chairman the gentleman from massachusetts the gentle lady from california the ranking member of the subcommittee the gentleman sitting there from tech mr graham mrs maloney who is here the gentle lady from new york they've all said why in the world are you changing your vote let me let me say the entire body there is a change in circumstances and let me offer this as proof two years ago this was quote the same bill the chairman the gentleman from massachusetts voted against the bill two years ago the gentle lady from california who says why are you changing your position she voted against the bill two years ago the gentleman from texas voted against the bill the gentlewoman from new york voted against the bill let me tell you what some of those circumstances are two years ago and let me say this to the gentleman this bill in many respects is better the bill two years ago and we need to pass this bill and i will predict and gentleman from california the gentle lady from cal i mean the general the chairman from massachusetts the gentle lady  the subcommittee chair from california this bill is going to go to the senate but we do have objections to this bill and we are going to protest those objections by voting against the bill two years ago was exactly when you all were in the minority the reason you voted against it you voted against it it's not the same bill now what is it that we find uncomfortable about this bill it's not that were established or strong regulator it's that we're doing things that run contradictory count so what we're trying to do here today and what we're trying to do we're trying to assure the safety and the soundness of fannie mae and freddie mac we're also trying to make them less to the and the more than dependent more on not beholding on the government we're saying this is quote implicit guarantee that the government will stand behind the g s t that we're going to stablish an independent regulator and we're going to try to move in a direction where there are more independent and their function more like a private corporation which was as originally conceived but then due to the additional call were to say we're going to make them more sounder more independent more stable and then we as we put all them an obligation of three billion dollars the same time we're going to increase our call boss three billion dollars over the next five years we're going to make them pay a part of their profits into a fun and yes let me say this there is a problem in our country a problem of the lowest income americans i've said this i've said this and committee i say this on the floor of the house probably the group of americans most in need of shelter are the lowest income americans and for them and the chairman are in agreement on this for those who need affordable rental affordable rent rental properties and we need to do something about that we need to address that we have presently is fifty or sixty housing programs and part of their responsibility is to address that need now what we ought to do before we establish yet another affordable housing font well to see why the fifty or sixty that we have that are spending hundreds of billions of dollars why they're not meeting this need why money is being wife did why there is still an unacceptable amount of fraud why don't we play an up and make more effective and efficient those housing programs that that address those needs instead of turning around and creating yet another housing pro now not only do we address goals that we have fifty or sixty other federal programs which are supposed to address but how do we address it are we talk about how important the financial stability of the of the g s a is are but yet we say that over the next five years we're going to make you pay three billion dollars five hundred million dollars a year to a yet another federal housing program and then we do something else because there is a chain reaction where does this money come from well it comes from middle and low income american homeowners that fannie mae and freddie mac or are holding their mortgages are mortgage backed securities so where does fannie and freddie get this money because they don't print money well they will have to get it from only one voice and that's their customers their clients that is every low and middle income americans that takes out a mortgage they will pay under this fun and who won't pay into this fun opera class americans and many upper middle class americans they won't there will be no obligation on their part on this three billion in fact what is the mission of fannie and freddie it is to promote affordable housing for low and middle income americans and yet those are the very americans tax on middle class americans now i would say that it is not a tax on all middle class americans it is a tax on middle class american homeowners and he has said that but we probably should have been fairness to include the low income americans who will pay into this fun we probably ought to include them because of those because we're three billion dollar obligation on behalf of american homeowners low and middle income we are going to offer an amendment to take out what is really an extra provision in this bill and that's a bill to create yet another federal federal affordable housing fun we're going to do a second thing we're going to offer amendments that say if there are benefits to this affordable housing fun and if it does pass it out to an art of the benefit of american citizens those who live in america and are citizens and on there and there before five there will be another very very young dollar federal housing program and we are particularly concerned about this because when the f h a bill came up three weeks after this bill came up and we created in committee a three billion dollars new federal housing program we raised f h a fees and we created another are we a placeholder in that bill that will move out here we created another federal housing program to add to the tens multibillion dollar plan to hell low income americans with affordable housing and are if we do if we do are we going to  the call to low and middle income americans to purchase a home and to the cost of that mortgage or are we going to increase arafat chafey are with it when they do address that last year and i really wish we had we both have seen it we've seen this coming for a long time and he and i are both happy that the regulators have started moving and we'll just see if that's enough but with all these problems and subprime lending and the reduction and look within the mortgage market we've said many times we're going to have people are going to need to avail themselves of the but yet just like we did in this bill we increased the cost to those homeowners and it simply does not make sense now now the chairman's masters's keep saying no no we're not we're freddie to reduce the cost they're more you know we're not we're not getting it from them we're getting it from fannie we're going to from freddie were get notes on their credit they get their money they get it all from the homeowners they don't get it from the they get it from the homeowners and these are the people they were going to tax when we passed this bill today so we are opposed to this bill we are protesting the inclusion in this bill of yet another federal housing assistance program and that we are taxing we're taxing low and middle income americans now that the chairman in fair to the chairman a lot of this money will go to louisiana mississippi where the first two or three years in fact of the because of that there are republicans particularly two years ago  we agreed on a number that it would take we passed it and yet here we go again with more money for katrina if we need more money for katrina relief and that relief is going to go in saying well six more months but that way it's been another six months another six and here we go again three months ago we passed what we said would probably be it was that we constantly said during the katrina bill that we intended to provide the new housing construction money through this bill is a surgeon that there's some duplications could not be more wrong we were very clear that the katrina build  did any significant increase in housing construction secondly he notes that i had a general go for new mothers voted against the bill last time as i said earlier today for one specific reason the rules committee over the objection of the services at that time injected into the housing fund amendment that would have kept the catholic church in the methodists and all the other religious organizations that were interested in building housing from participating we had one very specific objection at that time the fund was going to be administered directly by fannie and freddie there was a fear that they would use it politically so one specific remember was put in by the rules committee were only one allowed to vote on the floor and it would have restricted religious groups from debating for that reason only we voted against the bill since this does not allow fannie and freddie to spend the funds that's out of there so that's why we're being perfectly consistent now warning for the general obama everything he said about the housing ago and the final thing the general miller noirs here done room alabama and i can we said we were raising f h a fees in fact the f h a under the bush administration asked us to raise fees last year the house passed a bill that would have allowed them to raise last year's bill that most of the republicans voted for that would have been now the f h a to raise free far more than us so i do not understand of the generale bama who voted with the gentleman who illinois to allow the f h a to raise fees further now brame's us when we passed a bill that would have restricted their ability to raise fees but what they wanted and maybe people got to go back and look at what they voted for and look at what they offered staff or have time we got time to do that three minutes of general california gentleman from california magnanimous to speak and members i rise in support of this legislation and i commend the chairman for the work that he has done the leadership that he's provided and the hard work of the members of this committee to get this bill to the floor  are no great issues that separate us on this bill we have worked out all of those issues we all agree there should be stronger oversight we all agree that that we had to get rid of all fail we had to have a stronger agency we were all concerned about the tremendous debt of the g s t and so that's all behind us there's only one thing that separates us and that's the housing trust fund and that's the most topical we believe that given the housing crisis in america we have a responsibility to assist those who cannot afford decent housing who are living on the streets who are paying much more than thirty percent of their income we believe we have a responsibility to assist them to help them the other side of the aisle does not believe that government should play any role in helping the least of these get into public housing the generally accepted definition of affordability is where a household to pay no more than thirty percent of its annual income on housing families who pay more than thirty percent of their income for housing are considered costs burton and often have difficulty aborting the festivities such as food clothing transportation and medical care we're not talking about housing for anyone's section of this country it's all over this country and mr banger's districts they districts sixty four thousand seven hundred fifty nine renter households and clued ing fourteen thousand seven hundred thirteen extremely low income households of these extremely poor households fifty seven percent are paying more than half of their incomes for housing in this district there is a deficit of seven thousand four hundred and ninety seven units that are affordable and available to extremely poor households and mr blunt's district the seventh district of missouri seventy six thousand thirty four rental households including thirteen thousand eight hundred eighty five extremely low income households up these extremely poor households fifty seven percent paying more than half of their income for housing hundred seventeen river households including nine thousand five hundred twenty five extremely low income households of these extremely poor households fifty percent paying more than half of their incomes for housing mr baker for introducing this year's g s c bill to establish a new and stronger regulator for of the g s a s and the federal home loan banks like last year's legislation this bill aims to give the the new regulator clear direction about its authority available tools and mission and with this enhanced authority and guidance in new jersey g s a regular can guide the g s a as to be most effective for homeowners market participants financial institutions and taxpayers the overall purpose of the g s t reform bill is to create a strong world class regulator and i think that this is in this bill we do we directed a new regulator to review and set portfolio limits establish minimum capital requirements and review new programs in product however unlike last year's legislation i think that this this year's bill introduces a new extraneous because a provision that does not permit the new regulat so focus soley on these very important duties and this bill does not isolate this regulator from political influence but rather establishes a stream of cash that is financed on the backs of the american homeowners  why do i say this what is the affordable housing trust fund does anyone know and why would we allow g s a money to be diverted to an unknown nonexistent entity this was not in last year's bill in the last years bill permitted fannie mae and freddie mac to manage an affordable housing fund and this this year's bill permits a new regulator to it to establish and regulate the fund i don't think that it's appropriate for this new regulator which organizations receive the funds the new g s a g s c regulators tasked with establishing regulations to determine the prescription for states to distribute the funds and as stated in house report ten eleven zero one forty two that and i quote this bill provides that funds allocated for the affordable house in turn fund may be transferred at a later date to a new national of forty affordable housing trust fund that may be subsequently enacted into law i think we just don't know what is going to be the amount of money where it's coming from except if we determine that it's estimated that it would extract three billion dollars in assessments from frannie mae and freddie mac over a five year period there is no dollar limit as to how large this song can become where will this money for the fund alt l come from it will come from low and middle income americans seeking to purchase a home or refinance an existing mortgage hardworking low income and middle income americans who are trying to have their part of the american dream will ultimately footing the bill for a national housing trust fund the purpose of which is not yet been determined in law to actually heartier pay working american homeowners is not the way to fund new affordable housing  and i share chairman frank's commitment to increasing the stock of affordable housing for low income americans but but this fund i think is the wrong way to achieve this objective so therefore i would urge my colleagues to take a look at a housing fund section of this bill i think we've got a really good bill here it's similar to last year's bill but perhaps and what i know that we've talked about this in the committee that we should have hearings and further discussions on the need to build more for more affordable housing in this country how worked and be done and how it can be financed and particularly what this new affordable housing fund wanted to talk about particularly the passage of this bill and let us understand that since march of two thousand we have had hearings and have attempted to get to a new regulator the government sponsored enterprises of fannie mae and freddie mac and ultimately the federal home loan banks we came very close to years ago passed through this house it didn't make it through the other body we have an opportunity in this congress to accomplish that as a matter of fact one of the compliments to mr frank is that he didn't run out there wholesale and create all kinds of new gadget bill basically this bill is ninety nine forty four one hundred percent the same that we did in zero five what will it accomplish it's going to get us a world class independent regulator for as the ranking member said a little over for almost four point nine trillion dollars worth of securities i think that's important and here the major opposition that's being discussed think maxine waters was very correct in that analysis where we're arguing over five hundred million dollars a year and we're talking about an institution that is four point nine trillion dollars that we have to regulate and know that in the last several years there were errors in the stakes and potentially even fraud committed in these organizations as a result of the weakness of our regula so we went to great lengths in a bipartisan way to say and have these hearings over the last seven years let's create a red later that we can all be proud of but more than being proud of it that we can be relatively certain that the securities market investments of the united states in the in the real estate area are going to be safe and secure and i think this bill does that now this little argument we have over the trust fund five hundred million dollars a year potentially if you think about it amounts to about a day and a half of what we spend in iraq every damn day day and a half now you know you could argue we don't need any housing in the united states and i think you can you can credibly make that argument of if you're of that philosophical bent and of course on the side of the aisle because we probably are closer to the people that do need that housing we can make the argument there is a need but never in correct to two minutes of the gentleman from massachusetts two minutes of the gentleman from california's recognize for four minutes thank you very much i want to thank to make a move baucus for yielding the the time i know that this is been an issue he's been working on for years the same as i have about the last three years this has been a focus for us dealing with this issue that's been impacting and and it made ways very beneficial to the housing market night i commend chairman frank insect paulson for their hard work to strike an agreement so that we can move this important reform legislation forward we must provide for a strong regulator for the g s c so the investors in the markets are assured that these companies are sound and their investment in american housing markets are safe this bill recognized this strong regulation provides a means to achieve our ultimate goal of expanding the supply of housing credit throughout this nation the goal in the process we've taken today is to preserve the mission while strengthening the authority of the regulator as everyone knows we have been working on this issue for a number of years though this lengthy legislative process i've always asked my colleagues to be mindful that as we address deficiencies in g s t supervision we must not lose sight of can congress is original intent that chart of the g s e's the mission of freddie and fannie is to provide stability in ongoing assistance to the secondary market for the residential mortgages and promote access to the mortgage credit and home ownership throughout the united states the bill to force a day bills upon the bill that passed the house on the leadership of former chairman of oxley in two thousand and five that bill passed by an overwhelming vote of three hundred thirty one toni and as i was looking back at the record at that point in time it rather surprised me that based on the comments made by the administration at that time they're saying that the bill today creates a stronger regulator than the one we passed in two thousand and five and i was really surprised to read to that before the bill before us today the administration unlike the bill passed in two thousand and five was treasury opposed them because they said it failed to provide a strong regulator that could protect the safety and soundness of the housing financial system today the bill they say provides for a fully empowered independent worldclass regulator that can deal with any safety and soundness issues that might arise i had no idea back at that time the opposed it but i knew they supported it today the  housing fund i voted repeatedly to strike that i've never supported i didn't support it when chairman obviously i put it in the original bill i know many of my members did on my side or oppose this however i continue to share the view of our former respect chairman oxley that a stronger more effective regulator of of the housing jessi's is absolutely critical and outweighs our philosophical opposition to the fund i voted for that bill then i'm going to vote for this bill not tonight this le provide for a strong late regulator for the g s t so that investors and the markets are assured that these companies are sound and investment in the american housing markets are safe improved regulation will fight a means to achieve our ultimate goal of expanding the supply of affordable mortgage credit across this these have been the forefront of creating affordable housing opportunities for families and we must ensure that they're successful in the future this bill does something that i'm very supportive of and i've worked on likes it for about three to four years now it deals with conforming loan limits and high cost areas if you happen to live in hawaii alaska guam of the virgin islands you can get a loan for one hundred fifty percent of conforming today but if you live in a high cost area of california or other parts of country you cannot and if you look at the benefit on the marketplace today expression in california we are having severe problems in the jumbo market area where the the foreclosures and defaults are excessive and i believe that if if the conforming marketplace were there today we would have less problem than we're seeing today the full closure rates are out of control if you look at the jumbo market in california the problem we're facing is that only eighteen point one percent of the jumbo loans that are made  leadership in the passage of this a tremendously important bill for american homeowners and for those who are in desperate need of affordable housing i wish to be associated with the comments of mr frank and mr gary miller on the conforming loan limits and high income areas such as the area i represent in new york city is very very important for affordable housing and keeping with the bipartisan spirit of financial services committee this bill was reported out with a strong bipartisan vote of forty five to nineteen and when it passes today it will completely overhaul and strengthen the regulatory oversight of the g s sees a government sponsored enterprises of fannie mae freddie mac the federal home loan banking system and it will create a new independent regulator with broad powers similar to those of current banking regulators it also requires fannie and freddie to establish an affordable housing fund something that should have been done long ago it's important for affordable housing in our country and i congratulate the leadership of mr frank and mr baker and mr oxley in moving this fund forward and contributions will be based on the average total mortgage portfolio which will include all mortgages whether hell for investment or securitized and it will be distributed through the states and very importantly the first year the money will go to the ravaged area of katrina and rita where people are living without housing it is tremendously important it is creative and it addresses a need a desperate need in our country in addition to the affordable housing goals that applied to frannie and freddie we enhance the bill in a number of ways including a provision that i sponsored along with mr baker to encourage the creation home based child care centers my close by acknowledging the many positive aspects of this bill and just reiterate that had it not been for the creation of a new affordable housing for on new government program we would have had consensus here but that should not distract from the fact that we do need a strong independent regulator and mr as the gentleman from pennsylvania said and with that i yield a balance of my time to the gentleman from texas mr hanson the gentleman of tech from texas is recognized for two and a half minutes i think the ranking member for yielding and i thank him for his leadership on this bill i also wish to thank our chairman who although i have deep philosophical differences with the certainly fair in his deliberations and more than fair in the amendments that he is allowed here this evening indeed i think that the conflict today comes down to the so called affordable housing fund many on this side of the aisle do not feel that in this bill which is supposed to provide a strong regulator for fannie and  freddie we need to be expanding big government and regardless of the rhetoric on the other side according to o m b federal housing assistance has grown seventy three point eight percent in the last ten years yet this bill creates another new housing program on top of the ninety other hud programs ostensibly designed to make housing more affordable meanwhile the democrat majority early this afternoon mr speaker made housing less affordable by imposing the single largest tax increase in american history on the american people threatening home ownership of millions next this fun is supposed to be  transferred to some shadowy amorphous ill defined housing trust on which to many of us appears nothing less than the new entitlement spending program for the twenty first century this is on top of the enti spending that threatens to bankrupt the next generation will force them to double their taxes will shatter their dreams of home ownership and yet we appear to be adding yet another in title spending program next mr speaker the fine represents a dangerous precedent and a nother surreptitious tax increase on top of the tax increase the single largest tax increase in american history now our friends from the other side of the  going to impose a home mortgage tax on the american people using the federal nexus to levy a special tax on fannie and freddie which do their due awfully status in the marketplace they can effect on to home buyers in the way of higher mortgage interest so that this can be conduit into third party groups their bill this bill ignores the greatest affordable housing program known in this country a good job and a low tax rate the bill imposes new mortgage tax on americans and must be rejected gentleman from massachusetts where much time remains on my side jim of massachusetts has nine minutes remaining i now area that has cried out for greater regulation and i think we understand that looking back on what has happened that fannie mae and freddie mac over the last several years second of all the bill stablish is a trust phone that is very similar to the housing trust fund for which over two hundred of the republicans  voted last year so i really am surprised to find that this year all of a sudden there is all of this opposition to the trust fund so i want to spend a minute talking about the trust fund first of all it is a housing trust fund and fannie mae and freddie mac designed to incentivize more housing for middle income and low  so it's absolutely consistent with the purposes for which they were founded second that the ranking member of our committee made it sound like we're this is going to increase the cost of housing for middle income people and low income people in fact what we need to focus on is that this money will either go to the stockholders of fannie and freddie or it will go to the purposes for which fannie and single regulator all three housing government sponsored entities by having one regulator future problems in the housing economy will be prevented by providing real and strong oversight of the second secondly this bill creates an affordable housing one this fund will provide an opportunity for millions of working americans to afford housing that will allow them to raise their families in a safe and stable environment saddam will even be able to buy a home because of this new fun hardworking americans want the safe and stable place to call their own we have the opportunity here today so port the american by supporting the american dream  i'm sorry one and a half minutes the gentleman of new hampshire is recognized for one and a half minutes i thank the gentleman from pleading for yielding and for his tremendous leadership on this committee mr speaker i rise in support of h r fourteen twenty seven this bill provides an overhaul of the government sponsored enterprises and creates a much needed unified regulator for all g s e s now it was the high profile accounting scandals scandals at frannie and freddie in recent years that demanded that congress restore accountability and strengthen oversight in these institutions so this bill creates a strong independent regulator of fannie mae freddie macin the federal home loan bank system with broad powers comparable to those of federal bank regulators the bills also creates an affordable housing front to be managed by the new g s t regulator i want to thank chairman frank for creating the energy efficient taskforce on the financial services committee i'm pleased to serve on this task force chaired by my colleague from colorado mr perlmutter the task force is dedicated to greening the financial services community and in connection with h r fourteen twenty seven we included an important provision that would incentivize fannie and freddie to purchase green mortgages this  great first step towards our goal this is a bipartisan bill mr speaker and it's widely supported by financial institutions lenders housing industry participants housing groups and other financial service providers so when i hear the colleagues on the other side of the aisle speaking against a unified regulator they're standing against accountability and oversight and when i hear them speaking against an affordable housing fund they are standing against poor people in this country who need our chair congressman frank for his leadership and for yielding also congresswoman maxine waters for her very diligent and hard work in crafting this bill the american dream of homeownership is quickly turning into a nightmare for many and this bill really does begin to turn this around and yes as a former member of the financial services committee i had the opportunity to work with our chair this was when i was first elected probably my first a second term to really craft a housing trust fund along with our former colleague now senator bernie sanders and this bill incorporates and would authorize and create a new affordable housing trust fund for many years for many years housing has been a big issue for many of us here many of our districts are an affordable and this american dream of homeownership is turning into a nightmare this below the federal housing reform act of two thousand and seven will really help accomplish the objective our of our first national housing trust fund it increases homeownership for extremely low and very and low income families it provides for increasing investment and housing and low income areas for increasing in preserving the supply of rental an owner occupied housing for extremely low and very low income families and also increase investments in our public infrastructure and development in connection with housing assistance and also leverage is an vestments from other sources in affordable housing and in public infrastructure development i want to commend our colleagues again for engaging with our fifty two hundred national state and local organizations and leaders that worked for many many years to create a national housing trust fund just yesterday i met with my board of reloaders from oakland california may have an additional thirty seconds or no ok well i just want to say thank you frank for making sure that every gentleman from massachusetts express deep appreciation to chairman frank and ranking member baucus and certainly to congresswoman maxine waters and carolyn maloney of california new york who've really fashioned a bill that deals with the prolonged housing market slump due in large measure to increasing rates of foreclosure in the state of ohio welcomes this measure because we've been particularly hard hit the credit gap in ohio is estimated anywhere between fourteen and twenty one billion dollars as over two hundred thousand more mortgages will reset at higher interest rates over the next year and we don't need any more vacant units depressing the housing market in our region government sponsored entities can and should play a major role in reversing this trend this bill does that i would oppose any amendments designed to weaken ehrlichman aid the much needed national housing trust fund homeownership is the most important savings account that any american family accumulates and passing this legislation will assure that this congress understands that and the necessity of keeping our housing market strong and fundamental to bolstering the economy of the entire country and helping it grow chairman frank i care deeply thank you on behalf of the governor of ohio and all the people of ohio who are looking to us for leadership to help them hold on to their most important that their home thank you and i yield back my remaining time the gentleman from massachusetts has thirty seconds remaining i would take you to say that we often focus focus here what we disagree on let's be clear we agree on the strongest regulator that you could strong regulator as you know for about the front would you say this the notion that all of this comes out of the mortgages and not out of the shareholders is bad economics fannie and freddie do not have monopoly power such that they can pass along every cost to the customer and absorb none of it themselves thomas expired all time for general debate has expired pursuant to the rule the amendment in the nature of a substitute printed in the bill is modified by the amendment printed in house report one ten dash one fifty two shall be considered as an original bill for the purpose of amendment under the five minute rule by title and age tattle shall be considered read no a minute to that amendment shall be in order except those printed in the portion of the congressional record designated for that purpose before the beginning of consideration of the bill and pro forma members for the purpose of debate h m m and so printed may be offered only by the member who caused it to be printed or his designee and shall be considered read the clerk will designate section gentleman from california is recognized five minutes thank you mr speaker and i'd like to before i begin my general statement if i could i'd like to engage chairman frank and thank him for agreeing to engage in a colloquy on the receivership provision of the legislation chairman frank with with your consent with your consent i'd like to introduce into the record a statement that has been agreed to by your staff and  y my staff and i and i look forward to working on these these issues going forward with you and i would just ilda to you for your affirmation i thank the gentleman let me say first of  all given that i stepped out of work this out it's be a good thing for neither one of us to mess it up but i have read it over and it does correctly reinforce the point that this is not creating any new governmental involvement we don't want to want to misinterpret this this is to gentleman and reclaiming my time much chairman i i rise today to express my opposition to h r fourteen twenty seven fourteen twenty seven is supposed to be legislation to reform oversight of the nation's fourteen housing government sponsored enterprises that would be our two g ses fannie mae freddie macin twelve federal home loan banks over the past number of years i've very hard to reform regulation of these g s c s i believe better oversight is needed to protect our nation's housing sector from disruption should one of the g s e's face financial difficulty i am disappointed that i will not be able to support the bill authored by our committee's chairman however to beach to be fair i do acknowledge the chairman has added a number of positive provisions to this year's bill and i'd also like to thank the chairman for his willingness to work on improving the section on receivership improvements aside i'm deeply troubled that legislation intended to improve the safety and soundness of the j c s has become a vehicle to redistribute wealth the affordable housing fund in this bill unnecessarily confiscates money from the private mortgage market i adamantly opposed the creation of an affordable housing fund to day as i have since its inception in two thousand and five i was the first member of congress to offer an amendment in the financial services committee to strike the fund from g s t reform legislation since then i've continually and consistently opposed the housing fund in any form or shape or size as i said over two years ago the creation of this fund is an experiment in socialism and anyone supporting its adoption is attempting to countermand the basic principles of free markets said earlier in the debate we do not need another housing program and if we are if we determine that the ninety some odd housing programs are not being affective in addressing the natives of low income and middle income americans then we need to first form those programs but  passing legislation to strengthen the financial stability of our g s t we do not need at the same time to impose a three billion dollar cost on them on those who depend on freddie and fannie and those are low and middle income american homeowners and in fact regrettably that's what we do in this fun while we do a lot of great things the record number words damas recognize for five minutes i preach i got yours you gentlemen offering it because this is the central question that we'll be debating today and i realize we're going to be debating it a number of forums i hope not all seventeen that have been offered but but several and there was a legitimate question here i have to say i do want to defend my friend the generale bama for my friend the general california who said that anybody would support such an idea is advocating socialism i do not think the general bama was advocating socialism when he joined two hundred eight other republicans in voting for housing trust fund two years ago i think that's a little bit excessive we have i think some economic dispute you first of all the notion that all of this money five hundred million dollars roughly five percent of the profits of the two institute is together the notion that all of it will be passed along to the people who take out the mortgages the banks and everybody else incorrectly assumes that fannie mae and freddie mac have a degree of pricing power that virtually allows intercept prices however they were in fact there was time when they had a very large share of the market might have had such monopoly power they no longer do there is economic competition fannie mae and freddie macin not the only games in town and the notion that this will get all passed along and none of it go to the shareholders is faulty economics in fact this will come out of the profits of these institutions and it will i believe reduce the return of the shell's now i think that's legitimate these are institutions that machine with significant benefits because of various federal laws in the way those was a return by the market we say that they couldn't contain all the benefits by the way those who believe this ought not just to be opposing the affordable housing fun we have long had goals affordable housing goals which dictate to feigning mae and freddie mac that they must buy certain kinds of loans rather than others and we have got that to the point where they have to give preference to people who think under eighty percent of median and below that also when pinions on the profitability of fannie freddie downwards the argument is that anything that impinges on the profitability of fannie and freddie will automatically be passed along to the home buyers i think that's faulty economics but if you think it's  being made on the portfolio now many in the administration and many on the other side want to severely restrict the portfolio reduce it or say that it can only be used for them always to mortgages that amendment which many on the other side apparently freddie mac without hurting the average mortgage buyer and then before this much more significant impact on the profitability and the economics are the same the argument is no direct pass through here the argument is that if you impinge on their profitability they will raise their prices first of all the actions and causes they wish they were if they had that kind of pricing power i don't think they do it to the extent that there is some impact it will be far more greater your cheesed if the amendment were to be adopted by the general jersey and other efforts to restrict the portfolio the general alabama also said we have all these other housing programs no we do not have another program currently being funded that builds affordable housing for families we have two zero two for the elderly we have eight of heaven for the disabled both of which administrators try to cut back we are not building public housing we have the valve to program the voucher program on an annual basis adds to the demand for housing in a way that does not increase supply there is not now a generally funded affordable housing construction program for families for working people so the notion and i would challenge members to say this duplication show me which program th it doesn't restricted to the elderly in the disabled it is a general family affordable housing program and that's what we think we should get into it does it without taking money from the general treasury it pays for itself finally people said well how is it going to be spent we've made this point very clear in the first year it'll go to the mississippi and louisiana state authorities subsequently none of it will be spent until a second bill passes this house and the chairman said but before i do i would like to acknowledge and thank the chairman he said in voting against this bill two years ago i was not promoting and voting for it i was not promoting socialism and let me also acknowledge that two years ago when the chairman voted for this bill he was not opposing socialism so i think we both acknowledge that i was i was not promoting socialism and you certainly weren't opposing socialism nor are you today now the chairman has said that this isn't going to cost anything it's out of the profit it's not going to come from homeowners it's not going to come from fannie mae it's not going to come from freddie mac and we are we are really at a at a yes  the shareholders that's a profit of the company and the profits have to be generated somewhere and this idea of the it doesn't cost anybody anything and there's not a call to the customers  of the corporation who are homeowners it would be indeed a historic moment in this body if we passed legislation that cost billions of dollars but it didn't cost anybody anything it would probably be the first time in the history of this universe and if it does happen we should paul because we will have figured out basically had to devise defy the principles of mathematics point out and i think this is probably conclusive evidence of why we do not need to pass a three billion dollar additional housing fine and he and the chairman correctly only two months ago that we appropriated three billion dollars for katrina that is the three billion dollars that we voted for and there's no reason to have to pass legislation which actually passed this body once the president passed appropriating three billion dollars and here we come appropriate another three billion dollars so i will continue to say we determined we needed three billion dollars when i voted for this bill before and i stand by that we didn't need six we needed three that's why we voted for three that's why two months ago we said this is what will call with out a you're back to balance  gentleman from illinois will go to the years what the chair will do will go to the gentlewoman from from illinois and that will be followed by the gentleman from colorado just so there's an understanding we go based on members of the committee first the order which they are standing regardless of which the they may come from the gentlewoman from illinois for what purpose i move to strike the requisite number of words without objection gentlewoman minutes thank you m chairman i rise to support the amendment to strike the affordable housing fund i think the reason that we're we're having so much trouble talking about this i know that in our march fifteenth hearing urged the chairman if if we could spend some time working this out right or to coming to the floor and obviously that hasn't happened but i think because of all the questions because we haven't had a hearing on this and we don't know what the national fund is and keep saying we've got an affordable housing fund now it's estimated by c b l that it is going to be three billion dollars over the a five year fun can be where will the money for the fund all to lay come from we don't know about is it going to be from lower middle income americans or is it going to be from shareholders but i think these are all things that need to be considered before we have the fund and i know that it's you know trust me we're going to have a national fund and we'll figure out how it's going to work but i think that in this this day and age that we really need to give the regulator some idea of what their job is i agree with them so much of this bill i think it's a shame i voted for the bill last time and i was very very proud to do that other people didn't vote for the bill the bill that was it that was in that bill is now in this bill so but unlike last year's legislation i think this bill has included in this provision that doesn't permit the regulator to focus on the very important duties in this bill and to rather to have this affordable housing trust fund i think it is is too bad because the new regulator has the duty to write those regulations administered for and then administer an affordable housing grant run program from day one where we don't know what this national trust fund is going to end up being i don't think that that this is appropriate time to do it so i would construction of any significance for katrina affected areas in their home and would suspend the gentleman from colorado most remain in his state a gentleman from massachusetts my perceive the gentleman with bama incorrectly stated that we already voted three billion dollars for katrina in the bill that we passed for the hurricane that was one proposal for a project based section eight that could help build forty five hundred units there was no other money in that bill for housing construction members will go back and read the debate and they will see it was always contemplated by those of us for the bill that would be accompanied by this bill the assertion that the duplicate money voted for how to construct any katrina has zero accuracy this was always contemplated to be the second bill additionally the gentleman said i said the money wouldn't cover anywhere no quite to the contrary i said several times in his hearing that it would come from the shareholders i do not believe that fan freddie have a monopoly pricing power that allows him simply to pass along or because beyond that i did note that there are other positions being taken that would reduce the portfolio of fannie and freddie that would have far more impact on their profitability than the housing fun so those who believe that when you impact fannie and freddie's profitability you raise the cost of mortgages they could not be for any other reductions in the house and i thank the gentleman colorado and i would turn his time to him thank you and  like to say something to to the gentle lady from from illinois the affordable housing sign has specific and definite parameters as to how it's derived and how it's built so i'm not sure what she's saying is that there's no certainty attached to it and the other thing is this is a classic tail wagging the dog argument my friends on the other side here we have as mr baucus aptly pointed out an entity and it isn't it's a government entity these g s e's with trillions of dollars of assets and what we're talking about here is ahead is five hundred million dollars of affordable housing passing from one government t to potentially another it's less than one one thousandth of the overall asset base of the particular g s e's and less than ten or thirteen percent ten or thirteen percent of the several billion dollars misstatement in accounting which is what we're really trying to get to in this bill these entities could not account for their funds properly they need more oversight and i find my friends on the other side disregarding the purpose of this bill which is the oversight to rail against the affordable housing for people in low and very low income situations from profits that are generated by a government entity they're saying that's wrong that's socialism and i find that yes ideal to you mr baucus the gentleman keeps saying this is a government and now this actually is a government sponsored entity and what we do in this bill is we try to separate and say that there is no implied guarantee by the government for this and it needs to generate its own profits and it does that from homeowners who mortgages they purchase  in this instance this is my new compared to the assets of this government sponsored entity and this is a classic tail wagging the dog a night or just no vote on this amendment and you'll back my time mr chairman i yield back the balance of his time for what purpose does the gentleman from new jersey rise like a last word just direct enough for five minutes thank you first of all let me just commend the chairman on his work on this legislation with regard to the underlying of the basic principle of where this whole legislation became came from and that is to create a world class regulator i think was the buzzword when i first started working on this with regard to the g s e's and when the night is done and we vote final passage of this i hope that the language in the bill as the chairman is chairman is leaving but i hope that the chairman will stick to its promise and the assertions that what we have in this is a good regulator and they will not have any amendments that will watered it down but to the point of the ranking members amendment i stand in support of the amendment you know we should look at this bill and realize that what we have in this housing fund is a m t i a mortgage tax increase whether a person go after this bill with becomes law and individual homeowner go home perspective homeowner goes to buy his next house and he sits there at the lawyers office with a stack of papers this high that they have to fill out somewhere in those documents buried in all the fine print and other costs that always have found in a home purchase at the last minute will be increased cost to them and m t i a mortgage tax increase why is that because says the ranking member indicates you can't pull money out of thin air we are not creating perpetual motion by this bill we are trying to say they are trying to set up the housing finance a noose the flow of money to go into this but where does it come from now the chairman of the committee constantly retorts that it is not coming from the perspective homebuyer it is not coming from the low and moderate income individual who's just getting enough money together to buy that first house and yet they're being the doors slam shut on them because one more tax an n t i mortgage tax increase is coming through their income through this bill the chairman would suggest that it is coming exclusively from the stockholders or the chairman i don't see on the floor at this time but i would offer and entertain from the chairman whether he would operate to say except an amendment to the bill right now that w specifically say that that no increase in fees can be charged that we cannot raise any taxes on the individual and that all the money has to come from the stockholders and i wonder whether thank you mister wouldn't accept such an america that would be were not the same was not absolutely correct when he said it would all come from the with a gentleman yield let me just finish the point then i will yield the four is that it would have come from the stockholders and not from the home buyers now he just indicated that you can't put that in language because you cannot actually prove that's going to occur and that's my point that at the end of the day the g s these are in control of this they will be have the tax on them they will have to decide where this tax is going to place it on the poor low income family who has no bargaining rights with the g s t is that all or will be with their stockholders with the chairman just admitted that we as a legislative body cannot control the only new general so i'm disappointed the gentleman is nave economics no you cannot buy statue of fact these economic question my point is that's never measure of where the pricing power is and you do not it's impossible to sort out where it comes from when you talk about profits a corporation will maximize profit one of the restraints on that will be competition my belief is that there is sufficient competition in this field so their ability to put all the costs on the customers and not that much would come to shareholders if alves in the general regard think that's not something you do by statute as in every other context he would recognize thank you and and i'm not naive naive in my policy of politics or on economics at all because we know that in business at the end of the day the cost of anything that we buy is eventually paid for by whom by the consumer you can say that you're pushing it off on to the stockholders or the investors in the company but at that point in time you realize that if it raises the price too much for the stockholders or investors to invest in that company what will they do they will step back and they will not invest in that entity anymore they will not invest into the company anymore which raises the overall cost for investment for that entity in this situation then where does the cost go to it goes to the consumer and with that mr chairman i yield back saying that we should be opposed to this mortgage tax increase and yield back the balance of his time for what purpose does the gentleman from georgia rise as chairman strike the last where gentleman's recognized for about five minutes thank you very much mr mr chairman i want to talk about this for a moment first of all let me just address the gentleman's  amendment from alabama was a very honorable person and a very very good and highly thought of colleague but it's very important we recognize that his amendment is designed to do one and one thing only and that is t got this bill and that what the design is so matter which way you talk whatever the arguments you use is designed to cut the bill now for the last year and a half two years in our committee in financial services letter that i want to put into the record a culture of the most reverent nicholas damasio who is the bishop of brooklyn of the chairman of the domestic policy committee for the united states conference of catholic bishops here is what he says he says as chairman of the domestic policy committee of the united states congress of kaplan bishops i write in strong support of a provision in h r one four to seven the federal housing financial reform act of two thousand and seven that provides some five hundred million dollars a year from the fannie mae and freddie make as a dedicated source of funding for an affordable housing trust fund as you know the catholic community serves tens of thousands of men and women and children who struggle to avoid homelessness and maintain adequate housing besides sheltering homeless people who turn to us for help our catholic charities agencies dioceses and parishes have built and continue to maintain that thousands of affordable units but despite our efforts and the efforts of so many others there is just not enough of portable housing available and we believe that a trust fund will be a stable source of money for building and rehabilitating affordable housing for very low income people our spirits demonstrates to us homelessness an inadequate substandard housing destroyed lives the minds families hurts communities and weakens the very social fabric of our nation by setting aside money for a national housing trust fund congress acts to make the shelter needs of low income families a national priority now no not no not yet i've been waiting a long time to get my little five minutes in and you had time here this brings us to the crust of this matter and the crust of this matter gentleman from alabama and my colleagues on the other side how is it we have a pressing need we have a pressing need for affordable housing and nowhere is that pressing need more pressing then in louisiana and mississippi where this is targeted to how those people have suffered how much they begged and pleaded for help and yes we add pay as katrina funds but not for this and in committee time and time again we've raised these issues and your very amendment my distinguished friend from alabama was defeated in committee now it's very clear that seventy five percent of the affordable housing funds available in the first year will go to louisiana twenty five percent of such funds will go to mississippi for affordable housing arising out of the costs and out of the terrible agonies of hurricanes katrina and rita it's about time that we responded to these needs and there's no better way of dealing with it then through fannie mae and freddie mac but i do want to set the record straight so we understand from the point from the gentleman from new jersey and others so that and the public who is listening to this debate and watching this debate to make sure that you understand exactly what this housing fun is based upon it is funds and where the funds are derived from they're derived through contributions by fannie mae and freddie mac an amount equal to one point two basic points on each g s t is total outstanding mortgages including both those held in the portfolio and those that have been securitized each year from two thousand seven through two thousand and eleven and the program sunset in five years this is not a five years that's the responsible way of doing it and i submit that the gentleman's measurement will defeat jail not some of the expired for what purpose of the gentleman from texas rise of words gentleman's recognized for five minutes i'd like to yield thirty seconds to the ranking member gentleman taxes let me say this gentleman in georgia he said that my guts the bill because as he sees it the bill is this pressing texas control the tom the gentleman from texas thank you mr chairman i have heard the gentleman from georgia earlier reads and correspondence from a bishop i don't i don't have any correspondence from the bishop this evening but i do have some correspondence from some hardworking families in the fifth congressional district of texas talking about what we could do to make their housing affordable and i think it's particularly important when we think about my friend from the other side of the aisle earlier today literally just a couple hours ago passing the single largest tax increase in american history that will amount to roughly twenty seven hundred dollars a year on the families in the fifth district in heard from the freeman family in mosquita name they wrote me that with the extra twenty seven hundred dollars being forced to pay to washington my family could lose our home or we may be forced to give up education because the money won't be there to pay for it is really unfair that the low man on the totem pole is always having to give everything up these extra taxes are not needed well one way we can make housing affordable is not tax people with homes in the first place i heard from the kurgan doll family in garland texas there congressman hensarling i'm unemployed on social security and my wife works at this point between taxes and utilities were at the breaking point of being able to keep a home you know one of the greatest ways that a home is affordable if you don't take money away from the family in the first place and so besides the single largest tax increase in american history the democrat majority passed earlier today now they want to pass on a mortgage tax on hard working families struggling to make ends meet as well i heard from the stevens family a mosquito xs congressman hansen i wanted to let you know that i'm a single mom that does not receive any type of child support and a tax increase of this amount would break me i would be at risk of losing my home with this type of increase i'm writing to ask your help to keep this from happening this will be devastating to middle income families and families in my situation i mean as chairman i have many more letters like this and so we've heard so much rhetoric from our friends on the other side of that somehow we don't care about affordable housing the most  affordable the greatest affordable housing program in the history of this nation is a good job and a low tax rate and yet with the single largest tax increase in american history passed by the majority earlier that they threaten they threaten the almost eight million new jobs empowering people to buy homes you take the tax relief away crease taxes on capital dividends capital gains you start taking those jobs away and then you pass on this roughly twenty seven hundred dollars a year on hardworking families all over america you've got a double whammy you start taking their jobs away in the new start taking their ability to pay for these mortgages now listen very closely to the chairman of the committee earlier when he accused the gentleman of new jersey from i guess subscribing to naive economics i will admit it's been a number of years ago but i actually studied economics i have a degree in economics i spent ten years in private business and what i know about economics is that when you have a government sanctioned to optimally as opposed to an adam mystic competitive marketplace they have a great ability to pass on cost to their customers in this case ultimately the homeowner so i guess the gentleman our chairman has studied a deferent different economics than i do and i did listen when the chairman said that it's the shareholders that will pay so i'm offering a minute later this evening that says this so called affordable housing fund will go away if the regulator determines that interest rates go up and since the chairman believes that only shareholders will pay i look am surprised at the information that is being given from my prince on the opposite side of the aisle about this bill a mr gary from new jersey gets ups and talks about the mortgage tax and they would have you believe that somehow an audit to create this housing trust fund and have the g s a he's participated in it there must be something that they have made up call a m increase did anyone tell my friends on the opposite side of the aisle that the g s a's have many places they can take the money from first of all it is important for everyone to know and understand this money does not come from the general fund best money does not come from something called the empty up by this is after prop from the g s eighty's and they have all of these programs they have not only programs that they could eliminate they could rearrange and get millions of dollars from but the investors instead of getting huge profits they could be reduced a little bit so that money could go into this house and trust fund you know what think that the members on the opposite side of the aisle don't have a housing crisis in their too i don't know where those letters are coming from but let me tell you about his district a one thousand seven hundred and forty or forty renter household including porting thousand nine hundred thirty one extremely low income households and mrs henschel and district of these extremely poor households fifty six percent of them up paying more than half of their income for housing in this district there's a help the people in my district but i do mind carrying the burden for all over america for districts where there are people in need and somehow their representatives but get to represent them and my friend would have you believe that he's so concerned about the safety and soundness of these g s t and that they want independent worldclass regulated regulation and we have created that in this bill we have compromise we have worked with them we have put a new agency in we have done a great job are you willing to sacrifice that because you don't believe the government should participate in helping the least of these get some low income housing are you willing to give up all that we have worked for to ensure that we have g s ease that a safe and sound because you don't want to help poor people low income people people who work every day but simply cannot afford to own a home i have a decent place to live i don't think so i know some of my friends on the opposite side of the aisle may have some questions about how it's all going to work time ago to deal with bringing down the g s eight are supporting this housing trust fund these are your friends that you have worked with they like the bill and they like the housing trust fund and they have letters of support that they have passed out all over this congress and so i would say that even if you have some questions you don't quite understand it understand that a housing crisis people in need monies that can be gotten from g s e's that does not create something called an empty i that can help people to have a decent quality of life just understand that and couple that with the knowledge that you have worked very hard to make sure that these g s these are safe and sound and you don't want to give that up at this point i would yield back the balance of my time the question is on agreeing to the amendment those in favor say  member be considered as read and that i have the right to revise and extend remarks objection this amendment is drawn for the purposes of clarifying the process used by the new regulators advisory committee to recommend candidates to serve as independent directors on the boards of each of the federal home loan banks this proposal is a simple yet important corporate governance reform today the federal home loan banks benefit from the service and the guidance of individuals appointed by the regulator to serve on the boards of each of the federal home loan banks in addition to those board directors elected by members financial institutions because of the public private partnership in guiding and monitoring the activities of the federal home loan bank it is important that h r fourteen twenty seven would preserve the election and appointment system for constituting the federal home loan bank boards under the bill the advisory committee would recommend a list of individuals to serve as appointed independent directors to the head of the new regulatory agency this individual would then make the final determination about whom to appoint to the independent director states on the boards of each of the federal loan banks independent directors help to focus pay federal home loan bank on its statutory mission these public appointees also help to ensure that each board has the knowledge skills and expertise needed to properly direct and supervise the of the federal home loan back for this appointment system to work best and for independent directors to perform the role that congress intended the director of the new regulatory agency overseeing the housing government sponsored enterprises should have a choice among a variety of qualified candidates when making appointments just as a voters should have a choice of candidates in elections my amendment would allow such a choice to occur via two specific methods first it would allow the advisory board to establish its own independent process for identifying individuals to serve as a point of directors second the amendment would build on the rulemaking recently adopted by the existing regulator that has the boards of each of the federal home loan banks recommending individuals to serve as independent directors under this second route each board of directors at a federal known bank would put forward at least two candidates for each vacant independent director see if a board submitted just one name for consideration we could create a system by which the independent directors could become beholden to the group that nominated them for the appointed directors to remain effective and push the systems of mission we need to make sure that we keep their independence in place by modern by mandating that a federal  board provide at least two recommendations we will help to prevent these unusually cozy relationships from ever developing in some mr chairman my amendment refines the process is to be used by the federal housing enterprise board in iraq many individuals to serve as a point of directors on the boards of the federal mon banks in a way that helps to preserve their independence and to ensure that they help a federal home loan bank to achieve its intended mandatory objectives i urge the adoption of this proposal i certainly do and i don't feel like i want to express my support we've talked to members on the other side my understand this is one of nine that was going to be agreed to by the general pennsylvania has been one of the leading members of the house insisting on the public functioning of this board in the members and this is a another chapter in his live the book he's writing about how to protect the the input here from citizen so i strongly hope the amendment is adopted and it said it's my understanding that it was acceptable on the republican side as well the question is on the green to the amendment those in favor say aye those appalled say no an opinion of the chair of oz have it in the amendment is agreed to of the mortgage tax that those of us on this side of the aisle believe is being imposed upon the american people by this so called affordable housing fun earlier this evening the chairman said that he believes that this will be paid by the shareholders we believe on this side of the aisle that due to the do wobbly power of fannie and freddie that they are to control roughly eighty percent of the market and which they operate that he says stansell portion of the cost of the so called affordable housing fund will indeed be imposed upon homeowners in the form of higher mortgages indeed functionally a mortgage tax a new mortgage tax on the american people i was heartened to hear although i disagree with his economic analysis that the chairman has concluded that this will be paid by the shareholders a mime him it is fairly simple mince the section dealing with the having the regulator suspend the program now we know that within the language the program can be suspended sensually dealing with the stimac risk of the economy what my amendment does is if the regulator finds out that contrary to the chairman's opinion that there is a mortgage tax that indeed it has an adverse impact upon the cost of housing in america that mortgages rise that the program will be terminated so again i hope i understood the chairman correctly when he said that he thought this cost would go to shareholders if he does i would hope that he would except the a minute and if the chairman chooses not to accept them and then i'm i suppose and i'm sure the gentleman will let us know soon then i guess what we're missing is that indeed there is a mortgage tax to be imposed upon hardworking homeowners some of which we heard from earlier this evening from the fifth district in texas and we know how an additional tax is going to adversely impact them in the ability to keep their homes so i hope hope the chairman is right that shareholders as opposed to homeowners and up paying this if we're going to be stuck with this particular program and so this is a very simple amendment that says if we have a mortgage tax the program suspended if we're confident there is no mortgage tax and there shouldn't be any opposition to this particular legislation and with that mr chairman i would request and i vote and i yield back the balance of my time the gentleman from massachusetts i move to strike director number words the be ready to be here all night and maybe don't tuesday or come back on tuesday i understand the objection to the fine what i understand is why members wouldn't be wont to accept two maybe three chances to defeat it now with regard to the economics what i am shed first of all there was this myth that we've said it's not coming from anywhere we don't believe that it will come primarily michele by the way in earlier debates on the edge some of the opponents of the bill said the same thing if you go back and look at the transcripts of our committee can understand why anybody would want to do that you'll find people saying we were unfairly levying on the shareholders that didn't work there were people who do not believe that the federal government should be encouraging the construction of affordable housing and understand that the general regard you seemed annoyed when i mentioned it he has an amendment that by making restrictions on the portfolio of fannie mae and freddie mac their main profit generated would hit their profits far more than anything you could conceivably attribute to securitization market is far more competitive it's not animistic but there are states economic states between the wobbly and atomic and this is where we are here there are significant private competit you will know that because some members mr chairman of heard from them who don't like what we're doing here and we believe that the primary burden here will come from the shelves the notion that fannie mae and freddie mac can raise prices that will does not seem to me to reflect the economic reality be offering those other remembrances their is a common thread here they don't think the federal government should help build affordable housing we strongly disagree with that we believe that the federal government should the calculation that's being asked to be made here is a very difficult  make the gentleman prides himself on his economic expertise that he learned some time ago i don't know where he heard that you could easily make this kind of calculation that will be good unit debate and by the way what he does say here is that if at any point it turns out the deer was an impact you know things can happen flow the competitive situation can be more or less a lot of factors will affect this if at any point it happens then the fund is permanently shut down you'll note that he strikes the word temporarily  so i didn't hear you said you want to make something very clear and i would if we didn't hear it somebody made a noise why was that and i think again the chairman for yielding i simply said that you seem to imply that this was designed to somehow kill the program i just wanted to make it very clear that any way i could get rid of this program i would but i would ask the chairman for a clarification because you're a man and i understand that and that's clearly what's involved you and we will hear four or five different ways to do texas i thank the gentleman for yielding and i was going to ask the chairman for a clarification what i heard earlier in the evening is that the shareholders will pay the cost of the affordable housing forninst when i think i'm hearing now is that the shareholders will pay substantially most of the housing fine which leaves some portion paid by somebody else and so will i'm asking the chairman in his opinion if it's no longer being paid totally you by the shareholders doesn't that mean that some portion is indeed being paid by the home owner  debate the quantity of the mortgage tax that will be imposed upon the homeowner but it seems to me if we've gone from total shareholder payment to substantial shareholder payment there is a mortgage tax and i might request the gentleman i think the debt will be various the cost and it will differ different times in different economic circumstances depending on the benefit to our agent i believe that it is possible in some circumstances a very small percentage of the five percent  candor because what we have what we have just heard from the chairman is important because it's the first time that the chairman has recognized and appreciated that in fact mortgages will go up and they'll go up on individuals that may be the least able to afford them in this nation and therefore i think the contention of my good friend from texas that this is indeed a mortgage tax on individuals least likely to be able to afford them is accurate and i appreciate the challenge pointing that out and i yield back the balance  gentleman is recognized by giving one listens to the ebb and flow of this debate and sort of you lose track of what it is that we are about here this evening as senator moynihan said we're entitled to our own opinions we're not entitle to our own facts and perhaps if my friend from texas had spent less time making up things to try and scare people back home in terms of political fantasy and spent some time dealing with the substance that we have here this evening we would have less disagreement it was cited earlier that this proposal is an experiment in socialism well one can look at the history of how the special status of these entities of volved from being government agencies to being in this special hybrid status of the government sponsored enterprises the fact is that the federal government sets the ground rules congress sets the ground rules as my friend the chairman of the committee pointed out that there are costs associated with everything we do goals for affordable housing entails some cost the regulations in tail some costs and consequence they focusing in on on the lowest income has some costs and consequences this is all right this is what we are about here this evening is to determine whether or not as congress exercises its oversight its focus that it is appropriate in nature and it is reasonable in its outcome mr frank has pointed out that what we are talking about here is the in terms of this fun is a tiny fraction of the overall profits of multi trillion dollar holdings he's also pointed out and something that has not been refuted by our friends who are trying to kill it is that there are other proposals that they're talking about which would bear far greater impact on the profitability of the enterprises the question we should be asking is whether the goal is one that is appropriate and it seems to me very strongly that what has been identified here is an appropriate go it is consistent with the creation of these entities it ways to so called skin this cat and gut the bill this is a very clever way my good friend from texas whom i have great respect for m miss speaker let me just read for the record exactly what his amendment says so that we can really fully understand the lengths to create ative linguistic adjustments portable housing fun contributions in the case of certain factors in the bill that as written merely require a suspension of fun contributions and to also requires permanent and emanations o affordable housing fun contributions if a determination is made that such contributions are contributing to an increase in the cost of mortgage mortgages to homebuyers putting the issue in a considerably complex box now we know from the dynamics of economics what is happening in our society the day especially in the housing market we know what the ravages of hurricane rita and katrina has done to the area in which we're targeting the bill and we also know that there's no segment in society that is most impacted and in need of affordable housing than the very very poor those people who need the help this is where this bill is being targeted and his amendment would prevent the reinstatement of affordable housing funds when a g s sees financial problems temporarily cause suspension of phone contributions is resolved and would also create a new condition to shut down the phone that could arbitrarily result in the permanent elimination of the fun that is exactly what the gentleman's amendment does and that's exactly why we need to defeat it the time of the gentleman is express expired gentleman from texas yes and that mr and i request recorded vote are recorded vote having been requested pursuant to call six of all rule eighteen further proceedings on the amendment offered by the gentleman from texas will be paul paul for what purpose does the gentleman from texas r minutes as your speaker today i am offering an amendment to the housing counseling amendment that i passed in committee today's amendment will permit states to seek a waiver of the im person pre purchase housing counseling requirement if the person obtaining the mortgage lives in a remote area of the country which includes the majority of rural america i urge my colleagues to support the amendment friend getting to the point so quickly i apologize for my not being that it is a very good amendment it is i think been agreed to by both sides the general of texas has been a strong proponent of housing counseling we all agreed if we'd had more that earlier we might have less of the problem we have today he's been very strong on the questions of literacy and so i very much appreciate this amendment hope it is adopted we have no objection the gentleman from texas still has to argue yield to the gentleman from amended numbered four printed the congressional record offered by mr note about texas the general is recognized i believe that the incorrect amendment which one is financial housing industry financing model of the world because of the model that we have in place today america enjoys one of the highest homeownership rates in the history this country more people own a home today than any other time in the history of this country and primarily a lot of that housing affordability in the ability for americans has done because of our tremendous secondary market the ability to provide home mortgages for americans all over this country this legislation clarifies that when the regulator looks at regulating this into t that he looks at the safety and soundness of that entity and not external factors that just like we regulate banks we set certain standards for their capital for their loan to value their loan ratios and all of those other factors and we should not look at this entity any different than we look at other entities and so really this is a clarifying amendment it just says that we're going to look at the the safety and soundness of how this company is running their business we shouldn't put things out there that the regulator is not limit their portfolios i want to fica ms bain of illinois and mr moore of kansas and mr miller of california in joining me in clarifying the importance of making sure as we put together a first class world regulator for these very important entities to the american homeownership that we do not put in place things that would inhibit the ability of these entities to be able to deliver the quality mortgage products that they've delivered to the to the country over these years and so i think this is a very clear amendment clarifies the language make sure that we don't have any question about what the intent of the radio littery of what the duty of the mr chairman i rise today in support of h r four hundred twenty seven i want to thank chairman frank for his hard work in crafting such a strong g s t reform bill and i'm pleased that the financial services committee was able to move this bill to the floor so quickly passage of this legislation is necessary to further strengthen the u s financial system and is essential in establishing a sound regs regulatory environment for the housing g s sees fannie mae freddie mac and the federal home loan banks in order to ensure that the g s these are able to perform their congressionally chartered functions as efficiently successfully and safely as possible congress must put into place a robust worldclass regulator capable of overseeing the safety as well as their house in mission however over the last several months as congress has considered how best to achieve this goal much attention has been drawn to the scope of the new regulators authority in developing criteria to oversee portfolios which are critical in providing liquidity and stability to our nation's housing market on this issue in particular i believe chairman frank's intent in crafting this legislation has been clear from the beginning to provide bank like oversight authority to ensure the safe and sound operations of the g s a portfolios however when asked about the portfolio language chairman frank negotiated with secretary paulson james lockhart the current g s t regulator was quoted in january as saying quote my view is that inherent in any safety and soundness activity one has to be concerned about systemic risk and i don't think it has to say the word to have that as a potential consideration unquote in contrast during the committee's oversight hearings chairman frank once again reiterated what has been his consistent view that the language was envisioned to only cover mission and safety and soundness concerns this apparent ambiguity about the interpretation of the bill's portfolio language fueled concerns on both sides of the aisle and underscores the need to clarify its intent mr chairman the term safety and soundness is a well defined term in banking law and regulation what is less clear is the application of a so called systemic risk standard first there is no systemic risk standard applicable to banks or financial services holding companies and certainly no such standard imposed on the mortgages they hold second the question of whether or not to apply a systemic risk standard to fannie mae and freddie mac has already been asked and answered definitively by this house in the hundred ninth congress representative royce offered an amendment to the g s t reform authorizing systemic risk as a consideration for regulating the g s t portfolios this amendment was overwhelmingly rejected on a bipartisan vote of three hundred  forty six to seventy three such a strong repudiation highlights several of the questions that proponents of stiff systemic risk have been on able to adequately address number one how to define it to demonstrate how there could be a systemic risk to the overall economy that would not first trigger safety and soundness concerns to the enterprises themselves and three why should g s these be held to a different standard than other holders of mortgage assets furthermore mr chairman i was extremely concerned yesterday following the administration's release of its official state of administration policy in it the administration suggests that the portfolio authority contained in h r fourteen twenty seven helps to address the systemic risk that fannie mae and freddie mac pose to our financial system the sat leaves no doubt that the administration interprets the current language of h r fourteen twenty seven to authorize an application of systemic risk which is why i urge my colleagues to support this bipartisan amendment i'm offering today with representatives neugebauer moore and miller as it did in the hundred ninth congress the house must once again reject the vague notion of systemic risk and be clear that it is not intended to be a criterion applied by the new g s t regulator this amendment is very straightforward it would ensure that if there is sufficient risk posed to each company the regular regulator would have the authority to adjust the portfolio however the regulator would not be authorized to shrink cap or limit the size of the g s t portfolios based simply upon a nebulous determination that the portfolios are too large for that they might pose a risk to the overall system again i want to thank representatives randy neugebauer dennis moore and gary miller for their support and hard work on this issue i'm pleased the amendment has received such strong and broad based support i'm equally pleased to see that important trade associations representing the last years haven't been that thank you and i yelled back for part of the gentleman from california move to strike the requisite word the institution this was clear language was introduced within the bill and this merely clarifies the language in this amendment this is clarifying amendment not a weakening of the regulator that needs to be clearly understood the amendment mitigates concerns that the regulator could establish an overly broad scope and viewing possible risk to the portfolio the goal of this bill is to create a strong regulator this bill creates that but such an overly broad view could lead to unnecessary limits on the enterprise  activity to the detriment of the housing financing system the admin that would simply add three words those are to the enterprise to factor six section one one five so language would read any potential risk posed to the enterprise but the nature of the full folio holding systemic risk can be considered by the regulator it just must be in the context of safety and soundness and the mission of a g s e the problems we're having in the housing market today are basically in the sub prime and the jumbo market the reason is because about eighteen point one percent of those loans are fixed rate thirty year loans if you look at the conforming marketplace eighty two percent is a fixed rate thirty year loan the problem in the marketplace is not g s season the conforming the problem is in the sub prime and jumbo so you don't want to regulator to look at the problem in the marketplace and say let's limit the before leave a g s e and restrict the only sector of the  marketplace that is not having a high amount of defaults and foreclosures to the detriment of the marketplace if you go back to the one nine hundred eighty s in the one nine hundred ninety s when this country was in a major housing recession if you went to a lender it was almost impossible to get a loan if you did not comply with the conforming requirements they would not make you a loan to build a house and if you wanted to buy a house it had to be based on the underwriting criteria of the conforming marketplace thereby the could take and sell that loan off to the conforming market which of the g s e's lenders at that point in time were facing foreclosures no fault rates and having to set aside reserves to deal with that they did not have the assets to go take the loans and hold those loans in their portfolios because they were limited based on the false they currently had but they would make loans that met the criteria of the g s t and conforming marketplace thereby you could go get loans this amendment takes no authority out of the regulators hands to address systemic risk related to safety and soundness or mission of the enterprise but that's what we need to understand if the enterprise is pro fully or properly regulated from the sand point of safety and soundness the issue of systemic risk becomes moot therefore a broader scope of regulation of football is over reaching and unnecessary in addressing the safety and soundness the house previously rejected since to make risk in an amendment in the two thousand and five bill by a vote of seventy three three forty six at that point in the bill in the hundred ninth congress we wanted to make sure the systemic risk only applied within the g s cs not something outside and it was clearly defeated we did the right thing the amendment is consistent with the agreement and with the statements by the treasury and a failure and the portfolio provisions the language is not intended in any way to weaken the agreement with the treasury rather it is temp to clarify the language in the bill to better reflect that agreement as the original co sponsor of this bill i believe this amendment is consistent with our intentions on the proposal provisions treasury undersecretary robert steel confirmed this in his testimony to the committee in march fifteenth in an exchange with chairman frank when chairman frank noticed that the current language quote could go beyond the safety and soundness mission chairman frank suggested to the secretary steel that the language should be improved ensure that provisions would not be used beyond the scope and steel agreed at that point in time similarly of director lockhart testified quote my reading of the systemic risk it is part of the regulators job it's part of safety and soundness further in the letter following the hearing lockhart wrote quote we did agree that systemic risk outside of safety and s should not be a part of the regulator or us approach what they're saying in our bill is that this needs to be clarified this language does that it is harmful to the housing market were to do with the g s t portfolio when it's absolutely unnecessary now we have to look at history and we look at this g s t market has been very good this amendment has been supported by the national association of realtors a natural so sheet of home builders national association of mortgage amendment i rise in support of the effort of my colleagues from illinois texas and california to mandan clarify language in h r fourteen twenty seven i served on financial services committee since i was elected to congress in in that time i've learned about the regulation of financial institutions i strongly believe mr speaker that the regulators the financial institutions like g e ses should have the authority to assess the risk of an enterprise and to protect the safety and soundness of those entities h r fourteen twenty seven grants the new regulator strong authority to promote safety and soundness within the scope of that authorities the power to require the g s e's alter their portfolios in accordance with that goal i'm not aware of any financial institution whose regulator has the power to alter their business on the basis of potential risks it poses to the broader financial markets passage of this amend it would clarify the duties the new regulator to focus on risk to the enterprises which is consistent with the authority that other regulators the financial institutions currently possess mr speaker g s e's still a vital role in the housing market providing by providing stability liquidity and affordability the new regulator has to be responsibility of ensuring the safety and five minutes mr chairman reluctantly i am a speak with concern about the gentleman's underlying proposed amendment and there are more than sufficient reasons for me to express these concerns in my opinion going back briefly into the record of the difficulties with freddie and fannie as management of their derivatives portfolio bring to the house's attention the failed special report issued in two thousand three in which they determined that senior management in the board were quite aware that the skills and systems in corporate accounting were at the least challenged and that the derivatives group lack sufficient knowledge and training to administer the risk nonetheless they chose to move forward with an approach to faz one thirty three hedging that was complicated requiring a huge volume of monthly accounting events as hedges were read as ignited and chose to structure some very complicated securitization transactions without proper guidance in looking at annual to recoup shareholder report under their derivatives disclosure they now state we principally use the following types of derivatives euro interbank offered rate interest rate swaps lab or based options including swaptions lab or exchange traded futures and foreign currency swaps if we go further and look to the counter parties with which the enterprises now must engage hedging strategies we find that dorsch a bank holds thirty eight billion bank four billion and excuse me for my german is poor for vidhan fraga whoever that is at two and a half billion now in understanding why we should have concern about the restraint of a regular regulators authority to analyze the portfolio the underlying safety and soundness conditions and the elements of world economy that surround their hedging strategies one only has to remember for a short moment the day surrounding l t c m when there was a russian currency liquidity crisis and people who had no expectation across several different currency transactions and swaps were called upon to liquidate their positions and make cash available and were unable to do so it led the federal reserve to meet in emergency session in the new york fed office and they were surprised to see who was sitting around the table holding these positions including many commercial banks of whom they had no knowledge were participants let me say it this way if you don't care about any of that of our insured deposit institutions in this country almost eight thousand of the tier one capital requirement that's money you have to have by law in your sock drawer that says if it rains you've got money to mop up the floor almost fifty percent of them meet their tier one capital requirement beholding g s t securities my goodness ladies and gentlemen if there were to be the slightest of stumble it goes to the core of our financial depository institutions safety and soundness there are foreign central banks invested in fanny's and freddy's and if you don't care about that at least think about your pensioners there are billions of dollars of fannie and freddie spread across this economic fabric will win together in an extra couple of complicated math matter and we're going to tell this regulator you can only look through the keyhole you can't look at the room it makes no sense and i know i will probably lose on this position the homebuilders are powerful in the process but for the record i want to be loud and clear this is a mistake and i'll be happy and i think nobody in the general region has consistently been one of the most constructive members in this regard and are going to have a bill i hope from the other body we will get to a conference i just want to promise and i plan to continue to work with the general janet was the ranking members on the other side the second to treasury we went here we'll go in there maybe we have to move back a little bit so i would guide this as i understand where it comes from i agree with him that i don't think there's a point now in trying to fight it here but i do want to acknowledge that i don't consider it a solely settled issue and i'm going to be hoping that we'll find some way to accommodate the very legitimate concerns that he has as we go further with the film and i yield to my friend i certainly appreciate the chairman's comments and his recognition that the posture of the bill if this amendment is adopted may need further examination i look forward to working with him in our broader matter let me say as t construction of the bill generally the chairman has done an extraordinary job of giving the regulator the power and tools that he needs to save in this one area and i hope that in moving forward we can construct a box that makes appropriate regulatory sense the treasury's expressed these concerns tonight and i am not five minutes thank you mr chairman i wish to associate myself with the comments of the gentleman from louisiana i too wish to raise my voice loud and clear on the issue but certainly in a far less articulate manner than the gentleman from louisiana who is well versed on this issue in my opinion mr chairman the only thing worse than a regulated monopoly is an unregulated monopoly i don't necessarily trust private companies i trust competitive marketplaces and wherever fannie and freddie goes i feel the competitive marketplace leaves since i've been on the committee four and a half years now we have fur frequently from our past federal reserve chairman and our present federal reserve chairman their voices could not be more clear on the matter that they believe the g s t pose a very significant systemic risk to our economy now in a competitive marketplace you're punished for misleading accounting in a competitive marketplace you're punished for bad business decisions in a competitive market place you are certainly certainly punished for fraud we no longer have an enron we no longer have a world com we no longer have an arthur andersen we no longer have a new century a competitive marketplace before that could lead to specific risk took care of those who may have engaged in faulty accounting fraud or poor business decisions but that's not the case with fannie and freddie and now where we finally have empowered the regulator to do something the first thing we think to do now is to clip his  wings and i just feel that on this matter i'm going to listen to chairman greenspan i'm going to listen to chairman bernanke and i don't totally know the impact of the language that the people off of the i'm including my dear friend from from texas completely i don't know if i completely understand its impact but what it seems to do is all of sudden to say well the regulator can make sure that fannie and freddie can't harm themselves but they can't make sure that they don't harm the rest of us and that's my interpreter ation of this amendment and so again if we're going to sanction a government we're going to create essentially  awfully that at the last time i looked at the records control eighty percent of the market in which they operate that same not only as opposed to retrenching they seem to prosper when they misstate their earnings when they have billions and billions of dollars of misstated earnings when they mislead the government when they mislead their investors when they couldn't produce audited financials in years and i believe hold more debt than the publicly held debt of the federal government i think we ought to err on the side of strengthening the regulators ability to protect us by the systemic risk of what we in congress have created in the first place so i too want to raise my voice loud and clear on this issue and i certainly appreciate the chairman's willingness to work with the gentleman from louisiana and others of us on the committee who are very concerned about the potential systemic risk posed debate on this be divided a total of twenty minutes limited to ten minutes each and number thirty one which i forgot to mention which is from mr baker and i am proud to report that i am six seven eleven twenty and thirty one printed in the congressional record offered by mr frank of massachusetts modification to amendment number two offered by ms that he bernice johnson of texas in lieu of the men number two on page one forty line three before the semi colon insert the following and a program of financial literacy and education to promote an understanding of consumer economic and personal finance issues and concepts including saving for retirement managing credit long term care and a state planning and education on predatory lending identity theft dispense with any we can dispense with dol without objection two o without objection the amendment number two is modified and the amendments shall be considered on ball the gentleman from massachusetts and a member of the minority will each control ten minutes the minute address the need for public knowledge thing ok this a minute address the need for public knowledge and understanding of basic financial principles it also seeks to reduce our nation's already  consumer debt mom and it requires that anyone who receives federal assistance through the affordable housing fun complete a financial literacy program we must educate our nation's consumers to make informed decisions when managing their personal finances many consumers especially first time homeowners do not fully understand the complex financial agreements of which they are answering for most families their home is their single largest financial investment therefore it is vital to provide working families with the knowledge on how to buy and keep their homes the number of poor closures rises every month all over the country and in the dallas area we have one of the highest foreclosure rates in the nation a madman that will work to reduce the number of foreclosures and solidify a strong housing market education truly is the key to building a strong housing market and strong communities homeownership is a dream for many americans it represents security and it builds pride in our neighborhoods and it is essential in creating positive productive communities mom and we will help chairman at this time i'm pleased to yield the five minutes to the gentleman from arkansas the gentleman from arkansas is recognized for five minutes i thank the gentleman from texas f me so much time in the interest of trying to curry favor with the gentleman from massachusetts and the gentleman from texas of the very very great my minimum is a very common sense amendment that ensures that any homeowner applying for saving assistance the fordable housing funds are in the united states legally not passing this amendment will only make it possible and probably highly probable that people residing in this country illegally will receive these benefits at the expense of the us taxpayer to yield back the balance of my time the gentleman years back the balance of his time gentleman from massachusetts myself thirty secs to thank you denmark and so there are actually four amendments trying to achieve the same purpose i must say i thought his did it in the best possible way leaving flexibility there may be that you stretch your adopted you know i'm hoping this may save you some time later but i do want to say we completely agree and let's be clear now with the adoption of this amendment no one will be able to benefit from the affordable housing fine who cannot demonstrate that he or she is legally in this country i think that was very helpful i'm glad that it's going to go through unanimously and i thank you general market saw for the straightforward way in which he did it and i know twenty four cats already has ignited the amendment the gentleman's recognized and chairman i rise today in support of an important moment to h r fourteen twenty seven as we all know the underlying bill creates an affordable housing fun bill a list of prohibited uses for the housing fund grants these pro prohibitions include political activities advocacy and lobbying i know that my friends on the other side of the aisle agree with me when i say that government grants should not be used to fund political activities of any sort if they didn't they would not have included it in this bill my m m it simply applies the exact same restrictions on any future trust fund while an argument can be made against this amendment now that the prohibitions are implied in the text of the bill it is important in my view that when we are dealing with the taxpayers dollars that we are as clear and explicit as possible i thank the we try to deal with that you never anticipate everything gentlemens a member is a very good addition of the kind of safeguards we want so that we can be debating the real issue and not other things and so i am grateful to him for offering i think the chairman i know you time homebuyers who are to receive affordable housing fund grant monies do not discriminate against any particular form of housing in the performance of their duties or of rendering financial advice my amendment will prohibit any existing bias ease from entering into the financial advice that counselors administer to first time homebuyers and it ensures that the advice that they are providing is strictly financial not editorial the first time home buyers need to have access to information about all of the types of affordable housing that is available to them whether it is a manufactured home condominium or any other form of quality affordable housing we want to ensure that the people who benefit from this program have all of the information they need to make a sound decision based on their financial needs but counselors should not steer them to or away from specific types of housing mr  i think you move to strike the last word i thank the chairman i think congressman donnelly i think it is important as we get people into counseling to give them the best advice about how they can qualify for good loads and how they can get good credit and how they can take care of their financial needs as they move into housing that we not allow counsellors to be biased in the forms of the housing that they may like or not but give all the options out to the put to the customers and i want to applaud the gentleman for his a good moment will encourage my colleagues to join in support it without a yield back t my time down the years like violence of his time in general from economics time whatever mining the gentleman from massachusetts says six minutes the gentleman from texas has seven and a half minutes with him and i'll yield my shelf disappoint two minutes i don't see other sponsors just to say i i don't mean to be presumptuous and others may want to speak for me as well but one of the members we are adopting was offered by as a gentleman during the minority whip to require that any assistance for five years in the fund and from the national for about the trust fund be considered a federal award for purposes of federal funding accountability and transparency full disclosure etc i preach it once again the general majority are from this as with the gentleman texas remember these are two safeguards that we neglected to put in what while this is not going to be federal funding it will be treated since it comes from this federal enactment with all of the safeguards that would apply if it were federal funds and i think the whip is done a very good job in doing this he's picked up an ranking member spencer backus and the the chairman of the financial services committee mr frank for the open dialogue that we've had in the financial services committee and here on the floor this minute process i think has been a healthy one and i appreciate the chairman engaging in this debate the minute that i offer today builds on an amendment offered and passed in the committee during markup which i participated in and which i voted for  is well it requires a g a o study to investigate the ford ability the affordable housing fund's affects on the availability and affordability of credit for home buyers that's what the amendment added to the bill a sensually the g a o study will tell if the costs of the fund are being passed on to homebuyers some of us on this side of the aisle many conservatives freemarket conservatives believe that the the  what is deemed the affordable housing fund the housing trust fund will be passed on straight to the mortgage consumers of america and in essence a tax increase on those who have mortgages especially middle income individuals my amendment takes what is in the bill and goes one step further if as a result of the g a o report the director of the federal housing finance agency determines th affordable housing fun is increasing mortgage costs for consumers my amendment suspends the assessments of freddie and fannie i think this is a healthy thing as the bill stands freddie and fannie will allocate an amount equal to one point two basis points of their total portfolio to the fund for fiscal year two thousand and seven through two thousand and eleven over these five years the fund will accumulate an estimate as of a three billion dollars for the purposes of these housing initiatives but fannie and freddie are publicly traded companies and as a as someone who analyzes the economics of this i'm concerned that a one point two basis assessment one two point two basis point assessment of the total portfolio will simply be a one point two percent tax increase on those that have mortgages and what i want to make sure is the those costs are not going to be passed on to the consumer what i'm concerned about is that it will be a mortgage tax increase and that is the reason why i have concerns about the housing fund as it now stands so what my memet does is alleviate those concerns and if my minute passes and i think i'll be far easier to exception the housing fund as it now stands and that is my big concern with the bill i want to commend the chairman for putting in much needed reforms to fannie and freddie and the government sponsored enterprises and we want to make sure that middle income americans more middle income homebuyers will be able to have affordable access to mortgages that's what fannie and freddie are there for we want to make sure that this does not raise and increase the cost of home of home buying and i would ask my colleagues to support my simple amendment that would alleviate some concerns that we on this side of the aisle a few on this side of the aisle have with this bill and i encourage my colleagues to vote for and i yield back to bounce my time the gentleman get to exactly why we oppose this amendment and why it's important and again this amendment is again designed to of the raid the program now it's very important mr speaker for us to understand we're dealing right now with a very volatile housing market we're dealing with a situation where the sub prime market has melted down we're dealing with a situation where we've had record foreclosures we're dealing situation where the area we're targeting this to go to first for the first year has suffered the worst natural disaster where people are homeless as we speak there is a need for government we have a constitutional responsibility to take care of the public interest if there ever was a need for the public interest it is needed in affordable housing we do not need this kind of amendment that in effect does this all the studying he may want to say and i respect the gentleman from north carolina i do not question his motives and i do not dislike him as a person i just dislike greatly his amendment because his amendment goes again at the effort to cut this bill which is totally designed for the least of us for people that can afford it that people that need our help that's why we have this measure and when you look at the marketplace you cannot apply the activities of a free marketplace dealing with housing and put all of the convertibles you want to put on it as it applies to middle class or upper class in the visuals were the dealing with people with money we're dealing with people that don't have any money that's why we are providing this measure to them so that if your amendment goes into effect in effect you will be requiring the director to determine if the g s t the allocations to the fun will decrease the availability or affordability of credit to home buyers or will increase the cost to homebuyers if the director determines that the g s t the allocation to the fun will decrease the availability of affordability of credit to the home buyers or will increase the cost of the homebuyers the requirement to allocate amounts to the funds shall be terminated all of that power you're putting arbitrarily into a person's hands to say on his way i'm kill the program done with the program based upon what he sees and what he says that's why this bill this amendment must be defeated and we recommend strongly a no vote on your amendment for that reason the gentleman of from texas the general will the committee will rise and formally in order that the house may receive a mess the same intent affordable housing for as many americans as possible and that should be the intent with this legislation and i think i think it does in terms of the reforms implemented with for the government sponsored enterprises that we're talking about today the concern that i have is that the in essence we're going to be taxing the middle class and those that are on let's say lower middle class which the government sponsored enterprises fannie and freddie were intended to provide liquidity to in the marketplace were to be taxing those mortgages to pass it on to those who you said people that don't have money and so it's a transfer from that that middle class group to some some folks that are on the edges of society and mike my concern with that is that rather than us designing programs to bring them into the mortgage marketplace so they can provide for themselves that this simply will will supplement additional government programs  and further lock people into receiving government money rather than receiving a help up and so my concern is that we're going to be taxing those that can really not afford to be had to deal with additional all there's no raising of taxes here there's no in clues in of taxes here this money is coming from shareholders it's coming from the shareholders of these g s the exactly where it's coming from is reclaiming mckinley well that is exactly what a tax is you're taking from one group and giving it to a nother group and what this is is one point two basis points on a portfolio if you're talking about taking from the shareholders go ahead and raise the capital gains tax because i know it's part of the budget was passed today and i know many of you all believe in that on your side of the house some probably on my side but but my point is that i don't think we should tax contend those one point two basis points on the portfolio is simply a tax on every mortgage that flows through fannie and freddie if you're taxing the profits on fannie and freddie as originally designed you can make the intention that the actually contention that you're taxing the shareholders of fannie and freddie but with this design of the current bill before us if in fact you believe in affordable housing and encouraging more people into the middle class moving people up carolina he's right next door to my congressional district well well one county removed i guess and so this is burdensome when i have to rise in opposition to his amendments but this one i feel strongly about first of all i have heard this argument several times today that this imposes some count a tax on middle class and low income homeowners i think if you look into this you will find that this money is either going into a trust fund which we all support to increase homeownership and affordable housing in this country or as has been the case throughout fannie and freddie's existence it is enhanced amount of credit to additional homebuyers this is a choice between whether the shareholders get it or if we were going to finance affordable housing by the government whether the taxpayers would be paying for it which this trust fall on really should bills the taxpayers from having to put up this money that's my first argument the second concern i have is that this trust fund would sunset in five years and we have as a congress that if we pass this bill and it's a vase through the whole process we will have legislated the into existence the effect of this amendment would be to allow the director of this new with these all these enhanced powers that we've given given to him to on legislate what we have legislated which i think is an inappropriate delegation of how far to the now it may be that we make a bad decision to legislate it but we recognize that by putting a five year sunset in the not a good substitute from my vantage point to say to a director of any better all agency we passed this as a policy matter and we are going to give you the agreed to a study by the g a o and put it in the bill that would be an appropriate mechanism for us to get feedback where we could un do this at the end of five years or renew it at the end of five years but that's different than saying to the director you can go if you determine that  exists and you can unwind what the congress of the united states told you is the law of the land so if the gentleman were inclined to to offer th as part of his study which we approved i think it might be an appropriate way to proceed because it would help to inform us the g a o would do the study they would tell us what their results were and if we agreed with them that it was a big enough mistake then we could even before the five years we could go back and correct it but i don't want any director of some agency to be passing legislation either directly or indirectly and for that reason i think this is not a good good on and i encourage my dramatic change in the board structures of the two government sponsored enterprises and this issue deserves a public debate the charters of fannie mae and freddie mac presently require that the boards of both enterprises sh all times have five members appointed by the president unfortunately the bill the force today would eliminate the requirement for presidential appointees on the boards of fannie mae and freddie mac in my view choir in presidential appointees to serve on the boards of fannie mae and freddie mac is entirely appropriate given the unique nature of their charters and their important public missions government sponsored enterprises by their very nature are public private entities and they need to have a public voice at the highest levels of government the presidential power therefore single that each entity is not only accountable to its shareholders but also to a broader national public policy infers additionally the presidential appointment system gives citizens a needed voice in ensuring the viability of our nation's housing finance system and that the benefits of this system are widely distributed maintain public representation on the g s c boards is therefore critical to ensuring continued public trust in these very important financial institutions this amendment would accordingly re store the presidential board appointments systems for the g s a as it would also restore a change made in the bill that passed the house in the last congress by a voice vote this change provides flexibility in the sides of the corporate boards that fanni home builders and the national association of realtors in a recent letter to me about this amendment the home builders note that quote a diverse governing board of directors that is well balanced and knowledge and expertise is the full range of g s t related issues and activities of his critics they also believe that the amendment will quote help ensure that the jacey's board of directors are best equipped to make informed sound judgments in fulfilling their duties including monitoring risk management activities of the g s t executives in some this amendment is one that deserves the support of everyone who wants to preserve a public voice within these public private entities and promote good corporate governance it has the support as i said before of the homeowners in the real or mr chairman i urge its adoption and yield back the balance of my time who thinks time the gentleman the gentleman from florida is right and mr speaker move to strike the last word a democrat not five mins the speaker i arise to oppose the gentleman from pennsylvania is amendment i can tell you that we dealt with this issue in committee on a bipartisan basis and we decided that we wanted to take away the political operations of fannie mae and freddie mac we believe that you cannot serve two masters and do a good faithful job to both masters one of the reasons that fannie and fr in accounting problems in the first place is because of complacent board of directors that was populated with political appointees we believe in a post enron era that it becomes very very important that we take advantage of corporate governance standards that are second to none even those of us that have criticized certain portions of sarbanes oxley like section four hundred four as being overzealous believe deeply that sarbanes actually had some good corporate governance and conflict of interest rules that it has imposed that's why we decided that the trustee should owe a duty to the shareholders and to good corporate governance not to the political people that they have appointed them and i think mr cantor risky has an understandable sympathy for having some public oriented representatives but the truth of the matter is you wind up with members of the board of trustees that are going have to decide between whether they are loyal to the to the person that appointed them or to good tough corporate governance and to the shareholders that are seeking their best wisdom from pennsylvania will be i think it's number twenty seven direction it simply would postpone the day version of funds to the affordable housing trust fund that's created in this bill untouched in till such time as congress stops raiding the social security trust fund to pay for unrelated government programs this year the majority proposed and passed a budget that assumes that will raid the entire social security surplus to an estimated one hundred ninety billion dollars to spend on other government programs and then amount will increase in two thousand and three to two thousand and three billion dollars for the year two thousand and eight two hundred three billion dollars you know during the course of many of our journeys to this office in this last election cycle we stood up in see in your centers and in conversations and coffees and corner conversations and we said we will stand firmly with the seniors on behalf of social security you know the chairman of the financial services committee sort of quietly admonish the republicans on this side of the aisle who were here in the year two thousand and five mr chairman for voting on a passed bill and so forth but you know what there are fifty four new members of the house of representatives and we all took the oath of office i took it right over there where congressman feeney is sitting took my oath my wife was in the audience my children were by my side my mom and dad were here fifty four of us all came in thirteen on our side forty one on the other side and took that oath of office we were not part of the conversation in the year two thousand and five but you know what many of us campaigned on the integrity of the social security system and mr chairman i don't know what the parliamentary rule is referring to quotes and so forth and i know that it's not what in our family is called cool so i'm not going to name names but a quick google search of some of the new members of congress who joined me in this class the class of one hundred ten criticised opponents that they defeated for voting to rob the social security trust fund and spend it on other programs those were documented votes those are budget votes and they use the social security trust fund to mask the overall federal deficit someone else said we're going to make sure we have real substantive programs about how we make sure social security is secure or mr chairman how about this another new member said in their campaign that they would fight for social security for seniors or how about this language they would stop the raids on the social security trust fund that are used to help cover our nation's huge federal budget deficit you get the point you know like this choices and i respect the chairman and his passion on this bill and the intellectual honesty with which he has approached this you know when i saw the chairman who was injured i sort of thought that he might have tripped and falls over one of those blue dog signs that are littered all over the cannon building in my office there everywhere mr chairman i have a copy of one of the blue dog sign that says the blue dog coalition the national debt is eight point eight trillion dollars and your share the national data nine thousand dollars you know what those signs are getting a little bit faded there's not quite so mention interest in that issue right now on the part of the blue dogs it seems to me i think we have choices to make and i would submit that the choice that we have to make is a choice of priorities and voting yes on this amendment says our highest priority in this conversation that we're having is to ensure the integrity of the social security system it simply says it transcends this last hour or two of debate doesn't get into the profitability and loss the shareholders and so forth it says it admits ok great idea but put it on pause and take the money that the chairman has found take the money and put it into the social security trust fund that's what this amendment says it says put it on pause and use it to fund our obligation we've got a lot of a lot of moving parts in terms of problems in this country we've got the national debt we've got veterans obligations we've got pension obligations we've got to lower gas prices you name it there is one thing after another that we need to do and all this bill does is it says great idea terrific idea even wrong time so i think the majority of those great debt of gratitude to the chairman of the committee because he has come show me where in his amendment it says that if we don't spend on affordable housing we will put it into reducing the deficit i'm reading the amendment there's nothing like that in here or you go to the tell me oh look here's the point no i mean as you know i'm yelling for the purpose of a question outlays for social security programs exceed the total receipts i had all gone half of which does not that's a definition of the deficit good for the gentleman but it does not put any money into the deficit the gentleman said that if we passed his amendment we take the money from fannie mae and freddie mac the one point two basis points not one point two percent and put that into the social security trust fund i guess he's now acknowledge that nothing in his amendment would help solve security which i guess we'll learn later what's the second step for the know whatever else they want to however else they want to dance but like my colleague from illinois gentleman for yielding you know i think it's important within this context to realize who has the gavel and who has the majority mr chairman you have the majority you have the ability to direct vast sums of money and what i'm suggesting is that in your earlier conversation regarding those that were a part of the two thousand and five vote that you sort of felt like was somehow binding into perpetuity fifty four of us mr chairman were not part of that conversation and fifty four of us didn't really find it informative there are fifty four of us that came in this congress totally new fresh we're the etch a sketch that's clean forty one on your side of the aisle and thirteen of us and so what i'm suggesting is in the course of the campaigns that brought us here many many of us and i googled and searched several of yours and i didn't want to string them out by naming names and so forth but reciprocate but like you do you tend to finish your point and then i'll defer to you mr chairman we have to make priorities you know i come from the o'hare airport area o'hare is in my district you know the biggest challenge in o'hare and why everybody hates flying through it is because there's so many things so many planes in the air this puts another plane in the air when nationally you know what we've got so many things circling we've got one obligation after another that we're not doing well i commend the chairman look you clown three billion dollars the democrats should should give you a legislative well i was going to say something a little over the top they should congratulate you for finding that type of those type of resources and what i'm suggesting mr chairman is that we put this on pause i'm not getting involved in the debate earlier about whether it's a good idea or a bad idea say for the sake of argument it's fabulous say for the sake of argument western civilization won't won't process forward without it i still say that there are higher priorities and i named any number of them and what what what you done mr chairman in your advocacy and the way that you have asked us to i would characterize that as trust you and then and they made a bill not me personally but the congress decide how best to disperse it that is hardly changed trust me and i'm disappointed the german general it seems to me is fairer than that secondly he says high priority again this is fantasy land nothing in his amendment does a penny for social security and he says temporarily suspend hit the pause button until the deficit is over let's be very straightforward that means  nothing nothing in the gentleman's amendment puts a penny into the social security it's one more way to kill the affordable housing fun reflecting an ideological opposition to the existence of the federal government helping build affordable housing i thank you general georg be on my time please as would i like to get into this dance just a little bit myself because here we got this little program that we're trying to offer to help the very very poor to show you how desperate the opposition on other side they want to signal weigh this program as a savior for social security when they spent the last two years trying to kill social security with private accounts and then to try to use when you mention the blue dog coalition i want to know i'm a member of the blue dog coalition and i take offense to that particular point nobody has been working hard to bring down the deficit that you all created let the record speak for itself how can you even think to take this little poor program here that we're trying to help with get low income housing and then claim it to try to use it to try to offset the deficit when in fact we have over a three trillion dollar deficit and under your control of this congress for the past four years since nineteen cents two thousand and one you and this president sitting in the white house has borrowed more money from foreign governments and foreign nations yes indeedy then if you weren't for your party then all of the previous forty two presidents put together and all the work of the gentleman is very minute to address is much to speak of what i am saying is that there is a very serious hypocrisy here that must be point it out so that american people can make plain and understand the debate that is before us this issue has nothing to do with tax increases nothing to do with raiding social security or saving it and nothing to do with any day dealing with the dead and my whole point is that the reason it's so hypocritical is the opposition on this side has done so much to destroy social security to raise the debt and not respond and then the poor this on the backs of this little program that we have targeted to poor people is about as hypocritical as you can get the gentleman thing we ought to be able to agree on is that last year we took one hundred eighty five billion dollars from the social security surplus clearing everything that was paid in and all the interest arne last year and we spent it this year republicans democrats we passed a budget earlier today that takes one hundred ninety billion dollars every bit of it every bit year we're going to do two hundred billion and we can play the blame game but i don't think the american people are interested and how much the majority is at fault how much the minority is that fall i think what the american people want is they want to stop ah it's you can call it borrowing that's a nice word you can call it rating you can call it taking but the long and short of it is we're taking money every day that the american people the the people we represent are paying into social security and they're expecting upon their retirement to start drawing that money out and we all know it's not going to be there unless we change our behavior not you not us we in two thousand and seven to ten years from now ten years from we're going to start having to reduce our benefits on social security how are you explain to me what in the world that has to do with an amendment that does not provide a polemic let me actually ready let me explain what it has to do and i like the good point you said this doesn't come to that let me tell you if there is validity in taking three billion dollars or three billion dollars over there that that we can take from the g and we can do it without affecting their stability and let's just presuppose for sake of argument that we can do it without increasing the cost to middle and lower income homeowners let's just suppose we can do all that are shareholders let's suppose we can take it from the shareholders take it from the profits and it won't cost anything if we you know if we can do it if we can do it why don't we put it in social gentleman yield why don't we start a new program no matter how right now a lot of them don't work and for that reason there is a need and so we're we're passon another three billion dollars over five years i understand that i understand there's a need but you know though for we start addressing that need let's keep our promises to the american value w and we not know not i will in a minute but isn't is not so security a sacred promise how many of us if we raise our hands how many us would say no and if it is a sacred promise why don't we start tonight with this amendment and keep that promise to the american people we're going to you know the f h a bill was in committing we made we made an amendment ok if we if we can take some of the surplus phased the chairman others felt like it ought to go on the housing programs we said let's start putting it all and so start tonight let we said two we only know let's start two weeks ago and let's start putting it in to the social security until until we reach a situation where we're not taking everything out and once we get to and this is what this amendment say as it says once we get to the situation where we're not boring then then this money can go into this new housing program but today  congress gets to the point where we can honor our promise to seniors and not have to borrow their money from them instead of letting it interest in a return until recognize no i won't take five minutes i just want to remind members that we've just spent an awful lot of time arguing about something that has nothing to do with this bill and that they are a number of other amendments and i fear that at some point tonight we will regret this detour on which we have engage illustrates and the gentleman who was in his first term here will appreciate why the rules of the house are constructed as they are you don't have a provision for this to the debt because if there were a provision in your amendment to transfer it to the dead or to social security this amendment would be none germane to this bill and without germane this rules you can go off and talk about for as long as you want as they do in the senate sometimes about anything that they want to talk about  but the amendment that you have offered is marginally germane because you didn't didn't do what that he wanted to make sure to his constituents so i would hope that we could get back to the amendments that i remain and relevant to this bill and maybe finish this bill tonight would be it would be wonderful and i yield back the gentleman yield by his to the gentleman from new jersey strike the requisite number of where the gentleman is recognized five million thank you  let me just say this very briefly that i believe that the issue of the solvency of social security is significantly an important issue and i appreciate appreciate and appreciate your  this but i appreciate the opportunity for our constituents on home to be able to hear this to say this debate and this discussion with regard to how we see it is important and doing everything humanly possible to make sure that it is solve it and there for germane amendment and sort of learned the hard way the buzz saw the parliamentarian on a previous bill and sort of learned my lesson and i thank the gentleman for that with but i just want to long enough to let me clarify that i'm not i'm not arguing about whether this is important i'm arguing about whether the is germane and there is a reclaiming my time i