America's Financial Crisis

Floor Speech

Ms. KAPTUR. Mr. Speaker, the financial crisis has resulted in the largest transfer of wealth in U.S. history, from Main Street citizens to Wall Street titans, and Wall Street insiders made huge profits off the Ponzi scheme they set up that led to the real estate bust and to our economic demise.

As the rest of America tries to dig itself out from the rubble left in their wake, The New York Times reports today that the nine biggest banks paid $32 billion in bonuses to their employees of the $165 billion they got from us, the taxpayers; 4,793 bankers and traders got a minimum of an additional $1 million each. The average dealer at Goldman Sachs will earn $750,000 extra. Meanwhile, Wall Street is dumping their bad loans on us, through the government, while dragging their feet on the mortgage workouts.

Bear in mind, some people in this Congress and in the Obama administration decided to pay servicers to do mortgage workouts because they weren't doing them themselves. So, rather than holding them accountable and rather than this Congress' holding them accountable, the administration is paying them, and they're still not doing it.

Look at the rogues gallery. Bank of America got $45 billion in TARP funds while pulling in $2.7 billion in profits last quarter. They're going to pay $3.3 billion in bonuses. Wells Fargo got $25 billion in TARP funds and turned a $2.6 billion profit, and they will pay $980 million in bonuses. J.P. Morgan is one of the worst. They got $25 billion in TARP funds, and wracked up $2.7 billion in profits last quarter, and they will pay $8.9 billion in bonuses.

I am introducing legislation today to place a full excise tax on all of those Wall Street bonuses, to recoup the taxpayers' money and to direct it be used to do real mortgage workouts across this country on behalf of the American people to get our local real estate markets working again from coast to coast.

You know, Wall Street gorges itself on profits while unemployment is rising across our country, while foreclosures are rising and while pink slips are rising.

Look at JPMorgan. Within one week--and this happened in Ohio--on a Friday, they invited borrowers to attend a workshop for workouts. One little problem: Nobody from JPMorgan showed up until our office had to do their work and call their staff and get them there hours late. Only five of the original 20 borrowers who showed up to the meeting were left because they'd all taken off work, and they'd been able to get sick time to go to the meeting. Then we invited JPMorgan to a workout, and they said they'd send three staff. They didn't. The event went on with one staff member, and people left frustrated.

This is what is going on across our country, so the Obama administration called the 25 servicers up to Washington this week, and tried to talk sweet talk to them. The New York Times said it right yesterday. Here is what they said:

Why aren't these companies cooperating? We're enriching them, but beyond that, ``Even when borrowers stop paying, mortgage companies that service the loans collect fees out of the proceeds when homes are ultimately sold in foreclosure. So the longer borrowers remain delinquent, the greater the opportunities for these mortgage companies to extract revenue--fees for insurance, appraisals, title searches, and legal services.''

A Florida lawyer who defends homeowners against foreclosure, Margery Golant, says, ``It frustrates me when I see the government looking to the servicer for the solution, because it will never ever happen.''

The tax laws favor them. So, despite the Federal Government's chickenhearted efforts, the servicers will have none of it because they can make more money with all of these bonuses and in letting people lose their homes.

Look in your neighborhood. How many more foreclosure signs do you see there? When America went to war in the early 20th century, each citizen sacrificed for the Nation. Now it's all about the big shots. It's all about their bonuses and their power.

Has greed really become the top American value? Foreclosures are rising. Unemployment is rising. Ninety percent of the people in our country say the economy is not working for them, and Wall Street banks just can't seem to help themselves. They're squeezing more profits off of our people's misery.

What is wrong with this Congress? What is wrong with the Obama administration? What was wrong with the Bush administration that preceded it? Somebody had better stand up for the interests of the Republic.

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