S10544 CONGRESSIONAL RECORD — SENATE November 17, 2008 

learned a lesson. Instead, they are out 

there promoting more mergers. I guess 

those mergers will be promoted with 

the very money appropriated by the 

Congress. 

Mr. President, the action we have to 

take now, it seems to me, is to try to 

find ways to establish some confidence 

in this country. I have said often that 

I used to teach a bit of economics in 

college, briefly. I was able to overcome 

it. Economics is not a science; it is psychology pumped up with helium, and 

you can call yourself an economist, but 

nobody really knows. 

The economy in this country is not 

about dials, gauges, knobs, levers, and 

all of the things like investment tax 

credit, depreciation, M–1B, and all 

those things economists study. It is 

about confidence. When people are confident in the future, they do things 

that manifest that confidence. They 

buy a car, buy a new suit of clothes, 

take a trip, or maybe buy a house. 

They do the things that you do when 

you are confident about your future 

and your job. That is called economic 

expansion. It is not sophisticated. It is 

about how people view the future. 

When they view the future with great 

alarm and less confidence, they do exactly the opposite. They defer the purchase or decide not to buy that suit of 

clothes or buy that car until next year, 

or we will not move into that other 

home or take that trip. That is the way 

an economy contracts. It is all about 

confidence. 

The question is, what can provide 

that confidence now? One of the concerns I had about the original bailout 

was that it did nothing to provide a set 

of regulations that stops the very behavior that caused all of this. You have 

to learn from it. It seems to me you 

have to provide the regulation and say 

to the American people that we will 

not let this happen ever again. 

So there are a number of things we 

have to do. Any recovery plan—and I 

think we need a recovery plan, and 

some call it a stimulus. I think we need 

a recovery plan that gives people a 

sense that we care about whether they 

have a job. For example, there is discussion about the automobile industry. 

I don’t view this as three companies or 

one industry. I view it in the context of 

what do we do to deal with this economy, especially as it relates to jobs. We 

are told that industry relates to about 

3 million to 5 million jobs. That is the 

connector all the way through the industry. If that is the case, what would 

it mean if 3 million to 5 million jobs 

are lost in the next few months, coming from America’s manufacturing 

base? It seems to me it would be devastating to an economy already at 

great risk. 

So the question is, when will we also 

ask whether we will be willing to support, through a recovery program, the 

kinds of jobs that we need in this country and willing to support a world-class 

manufacturing base without seeing 

that base decimated as the economy 

gets weaker? I don’t think you will 

long remain a world economic power 

unless you have world-class manufacturing capabilities. 

When we look at those sectors of the 

economy that have that capability and 

then decide, as some suggest, that it 

doesn’t matter who loses their job or 

gets laid off, well, it sure does matter. 

It matters to me. If there is all this 

concern about the financial sector, 

what about the concern about the jobcreating sector in the manufacturing 

area? I think we need to do a number of 

things. No. 1, I think we need a stimulus or a recovery plan that would 

make significant investments. I don’t 

think you do that by just giving people 

checks. That is not the way forward, in 

my judgment. I think you do it by putting people to work on public works 

projects, by investing in roads, bridges, 

schools, and libraries—the infrastructure needs that have been so long deferred in this country. 

All of those projects are ready across 

this country to be done. It will put people back to work, and give people confidence about the future. 

Second, we ought to take action this 

week so that we say to the Treasury 

Secretary: If you are going to continue 

to move money out of that $700 billion 

pot, you have to put conditions on it. 

We don’t want the American people to 

have to read that they are anteing up 

money so the Treasury Secretary can 

move it to Wall Street and Wall Street 

can then pay bonuses in December and 

January and they can use that in any 

way they want without conditions that 

require them to expand lending or any 

other conditions that ought to be attached to that money. We ought to insist those conditions exist. 

Third, we ought to require regulations be put in place as soon as possible 

to prevent the kind of things that we 

have seen happen that caused this financial wreck in the first place. Those 

regulations do not now exist. I know 

the former Fed Chairman Greenspan 

said he believed in self-regulation. He 

sure got a bellyful of self-regulation, 

and it completely collapsed this economy. We need to put in place a regulatory approach that gives people confidence that this kind of thing is not 

going to happen again. 

We also ought to say to the Treasury 

Department: Stop the nonsense about 

more bank mergers. It is the last thing 

we need. Nor should we want the public 

money to be used to accommodate 

more bank mergers. I know some have 

celebrated the news of bank mergers. 

Not me. I think it weakens this country, not strengthen it. 

I also believe we ought to create immediately an investigative task force 

of sorts that will begin to investigate 

and prosecute, if necessary, criminal 

behavior that was engaged in some of 

the practices that I described earlier. 

All of that, I think, is necessary. I 

believe if and when we begin doing 

those kinds of things, we will give, 

once again, the American people the 

confidence about the future that they 

must have in order for this economy to 

get back on track. 

There is, I know, a lot of discussion 

about what went wrong, and some 

might say: You know what, that is 

pretty irrelevant. It is not irrelevant 

at all. We are destined to repeat mistakes unless we understand the mistakes we have made. The route out of 

this circumstance where there is great 

economic peril to this country and its 

future, the route ahead, in my judgment, must be an active, aggressive set 

of actions by the Congress, working 

with this President and the new President, to understand the urgency of the 

things I have described. 

Mr. President, I yield the floor. I suggest the absence of a quorum. 

The PRESIDING OFFICER. The 

clerk will call the roll. 

The legislative clerk proceeded to 

call the roll. 

Mr. INHOFE. Mr. President, I ask 

unanimous consent that the order for 

the quorum call be rescinded. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

f 

ECONOMIC CRISIS 

Mr. INHOFE. Mr. President, given 

the recent news about Secretary 

Paulson’s execution of the TARP program, I firmly believe action is required by Congress. This morning, I introduced S. 3683. That is legislation 

that would do two things. It would 

freeze remaining money of the first 

$300 billion that has not already been 

expended and, secondly, it would 

change the process by which Secretary 

Paulson would access the second $350 

billion. 

When Secretary Paulson first came 

to the Senate and explained his plan, it 

was on a conference call. I happened to 

be in on that conference call. It was 

September 19. At that time, he was 

talking about the crisis that is upon 

us, that we have to do something, we 

have to do something big. It has to be 

$700 billion. It has to be done right 

now. The only way to do it is to buy 

troubled assets. 

At that time, I asked some questions. 

One question was: If there are assets 

that are going to be bought, what is 

the criteria that will be used to determine which assets should be bought? 

There was not an answer to that question. 

The second question was: Which institutions that are holding these assets 

would be the ones that would be eligible for this buyout? There were no answers to that question either. 

That was on a Friday. Then as the 

next few days went by, we had several 

conversations. I didn’t have any personal conversation with him except in 

one conference lunch, and that is, Is 

this the only way to do it? Yes, it is 

going to be buying out troubled assets. 

Still the answers were not there to 

those questions. 

In my statement opposing—I voted 

against the Paulson plan last month— 

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November 17, 2008 CONGRESSIONAL RECORD — SENATE S10545 

in my statement opposing it, I laid out 

three primary reasons I voted no. The 

first is that I was not convinced that 

the asset purchase program was the 

right way to do this. Apparently, he 

didn’t think so either because that is 

not what he did. 

The second is that it would lead to 

increased lobbying for handouts and 

bailouts by any industry facing financial trouble. Now we are seeing that. 

We are seeing the auto industry coming in, some insurance companies and 

others coming in. It is kind of a new 

way of life: If you are not successful, 

don’t worry about it because you have 

the Federal Government there to help 

you. 

The third is that we were handing 

over, as I read it—and I don’t blame 

Secretary Paulson for this because I 

suppose if this is what he wanted, 

somebody else was willing to put it together. He was not the one, I suppose, 

who drafted it. But it gave one person, 

in this case Secretary Paulson, the sole 

authority over $700 billion. 

I have a hard time with big numbers, 

putting them into perspective that is 

understandable. But it is my understanding that there are 139 million 

American families who file tax returns. 

If you do your math, this would be 

$5,000 per family. We are talking about 

any family out there who files taxes. 

This is a huge thing. So it does require 

extraordinary thought in addressing it. 

As I stated at the time, my vote was 

against the Paulson plan, not against 

taking action to provide necessary confidence in financial markets. I do know 

and agree that there is a problem out 

there. I am not convinced that is the 

way to address it. 

We critics were right. On October 14, 

in a significant shift, Treasury outlined a plan to directly purchase equity 

stakes in major financial institutions. 

The Wall Street Journal noted that 

‘‘critics . . . say Treasury should have 

formulated a comprehensive plan earlier in the crisis.’’ This past week, Secretary Paulson announced that he has 

completed a remarkable about-face, as 

summarized by the November 13 Investors Business Daily front-page headline 

which read: ‘‘Major Reversal, Treasury 

Won’t Buy Bad Mortgage Debt.’’ This 

is a complete reversal. Why did 

Paulson reverse course? Last Thursday’s Los Angeles Times provides the 

answer: 

Treasury Secretary Henry M. Paulson’s decision to abandon plans to buy troubled bank 

assets shows that he has come to two conclusions about what was once the chief focus of 

the government’s $700-billion bailout: The 

first is that it wouldn’t work. 

That is kind of full circle. This is 

what we thought at the time, and this 

is where we are today. I know many 

have serious concerns about how Secretary Paulson has executed the financial rescue program, and I share those 

concerns. Congress completely abdicated its responsibility by signing a 

truly blank check. 

If we look at this and if we read it, 

there is nothing in there that says we 

have to do this. Never before in the history of America has anyone—elected 

or, in this case, unelected—been given 

a blank check or a check in the 

amount of $700 billion to do with as he 

wishes. It has never happened before. It 

is unprecedented. But that is exactly 

what happened. 

Now we are faced with a lameduck 

session. We can do something about resolving this problem now, and that is 

supporting and passing the legislation I 

introduced this morning. It is officially 

introduced. I believe I requested it be 

sent to the Senate Banking Committee. I am sure there are several 

there who want to resolve this problem 

before we recess. 

My concern is this: The way it is set 

up by law, there is $350 billion already 

out there, and he has been spending 

that money. Frankly, I don’t know how 

much has already been spent. There 

was an article in the Wall Street Journal a couple of days ago that said all 

but $60 billion has been spent. That 

may be true; it may not be true. I have 

no way of knowing. That alone is 

enough concern that a senior Member 

of the Senate doesn’t even know how 

much of the taxpayers’ money has been 

spent or what percentage of the $350 

billion has been spent. 

We have a second $350 billion to make 

up the $700 billion that will come, but 

it is rather nebulous, it is rather vague 

as to how that would be put into the 

hands of Secretary Paulson. My interpretation is that he would indicate, 

yes, we do need to have the second $350 

billion, and if there was not a resolution to stop that, to preclude that from 

happening, then he would be able to do 

that. 

My concern is that we will stall 

around and do nothing. We will adjourn 

and not come back until January. That 

would give him the opportunity of stating his intention, what he wants to do, 

and then have 15 days go by when we 

are not even in session. I think the 

only way to do this is to do it the way 

we are planning to do it now; that is, to 

bite the bullet. 

I know it is difficult. It is difficult 

for members of any body, particularly 

the Senate. This legislation, as I recall, 

passed 75 to 24. Those of us who are 

among the 24, who voted against it, are 

fine in terms of doing something such 

as this, but at least a third of those 

who voted for it would have to say he 

didn’t do what he said he would do, he 

didn’t buy the troubled assets. Therefore, that gives me reason to change. I 

can’t help but think that at least half 

or even more of those who voted for 

this legislation would find themselves 

in that position. When we look at 

where we are today and see that there 

is something that can be done, I think 

it is necessary that we go ahead and do 

it. One of the things that is going on 

now—and this bothers me a little bit— 

is that there is an argument going on 

right now between some of the committees—the Finance Committee and the 

Banking Committee—as to who has jurisdiction. Then there is a debate as to 

whether a special inspector general 

should be appointed, and they have 

talked about some names. If they do 

that, confirmation probably would not 

take place for another couple months. 

By that time, all the money is gone. So 

we are sitting around twiddling our 

thumbs doing nothing. Our last shot to 

do something is to do something while 

we are here. This lameduck session, I 

suspect, is only going to last 3 or 4 

days. So we have that length of time to 

stop this from happening. 

If the American people are concerned 

about this, concerned as I am and as 

many Members of this body are, that 

this was done without the consideration it should have had, this amount 

of money, $700 billion is out there now 

in the hands of one person to do with as 

he wishes, that is not good Government 

and it needs to be stopped. We can stop 

it by the passage of the legislation I introduced this morning. 

Again, it will do only two things. It 

will preclude and freeze any further expenditure by the Secretary of the 

Treasury and, second, it would preclude the second $350 billion from coming up for consideration. In other 

words, that would stay in the Treasury. 

I think this is the only chance we have 

to get it done. We better do it now or 

it is going to be too late and we will be 

out of here and it will be history by the 

time we come back at the end of January. 

With that happy note, Mr. President, 

I suggest the absence of a quorum. 

The PRESIDING OFFICER. The 

clerk will call the roll. 

The legislative clerk proceeded to 

call the roll. 

Mr. WEBB. Mr. President, I ask 

unanimous consent the order for the 

quorum call be rescinded. 

The PRESIDING OFFICER (Mr. 

CARDIN). Without objection, it is so ordered. The Senator from Virginia is 

recognized. 

f 

ATROPHY OF THE BALANCE OF 

POWERS 

Mr. WEBB. Mr. President, in the 2 

years since I have been privileged to be 

in this body, I have spoken frequently 

about my concerns with respect to the 

balance of power between the executive 

branch and the legislative branch and 

the atrophy of the powers and the influence of the Congress. There are two 

issues that are before us this week that 

I think illuminate the dangers of that 

atrophy. 

The first is in respect to the powers 

we gave to the Secretary of Treasury 

in our vote at the beginning of October, 

before we went into recess, as he addressed the issues of the bailout. Many 

Senators, including myself, wrote letters of concern immediately after this 

bailout was proposed, noting that it 

was unprecedented for one individual 

in the executive branch of Government 

to be given the broad discretion the 

present Secretary of the Treasury has 

been given. 

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