This Week in Washington – Friday, June 11, 2010
On Thursday, the House and Senate began its conference on H.R. 4173, the Wall Street Reform and Consumer Protection Act. I was named as a member of the Conference Committee that will hash out differences in the House and Senate versions of the bill. The American people deserve transparency, and I am hopeful we will continue to shed light on critical legislative debates like this one in the future.
While I wholeheartedly believe steps need to be taken to ensure a financial collapse like the one we experienced in 2008 does not happen again, both the House- and Senate-passed bills are full of special interest loop-holes and potential pitfalls that are virtually guaranteed to do more harm than good. Both bills will needlessly kill jobs, further restrict credit and access to capital, and cede unprecedented authority over our financial marketplace to unelected government bureaucrats.
One of my greatest concerns about these regulatory reform proposals is the negative effect they could have on small businesses. Small businesses created seventy percent of all new jobs in recent years. They can lead us in our economic recovery, but only if we are careful to enact legislation that won't restrict their growth or make it more difficult to hire employees.
As currently structured, the regulatory reform bills are likely to create new hurdles that make it even more difficult for small businesses to obtain credit or access much needed capital. This could lead to devastating long-term consequences for future economic growth and job creation.
It is time to end bailouts, take action on Fannie Mae and Freddie Mac, and streamline our financial regulatory system. I am looking forward to coming together and developing common sense solutions that will provide sufficient protection for consumers, small businesses, and our economy as a whole.
The Conference Committee is expected to convene for at least a week as both sides attempt to craft a final conference report that would then be voted in each chamber.
YouCut
On Wednesday, I voted in support of another "YouCut" initiative. It would have ended Fannie Mae and Freddie Mac's taxpayer-funded conservatorship, shrunk their portfolios and established minimum capital standards, saving an estimated $30 billion. Unfortunately, like the previous two efforts, it wasn't successful. I encourage you to keep voting. Your message is getting through, and I will continue to vote for these necessary spending cuts.
This Week
On Thursday, I voted – along with 405 of my colleagues – to approve H.R. 5072, the FHA Reform Act of 2010. Under current law, the Federal Housing Authority (FHA) provides mortgage insurance to protect private lenders from losses due to homeowners defaulting on their mortgage loans.
While many private lenders have reduced their lending activities during the current recession, the FHA has increased its share of the single-family mortgage market from less than 5 percent to more than 30 percent. The higher market share has increased taxpayer exposure, and the increase in delinquencies and foreclosures have almost bankrupted the FHA's insurance fund. H.R. 5072 would raise annual FHA premiums which are needed to improve the FHA's bottom line. This bi-partisan legislation also includes a number of fraud and abuse detection tools.
The House will be in session next week. Have a good weekend.
Sincerely,
