Omnibus Public Land Management Act will Increase Energy Prices

With passage of omnibus lands bill, continued dependence on foreign energy is assured:
On Wednesday, March 11th, I opposed S. 22 the Omnibus Public Land Management Act. This 1,300 page bill comprises more than 160 separate bills dealing with a number of natural resource policies. Though it contains a number of good components which I would have supported separately, the final bill included a number of egregious bills that will virtually ensure our continued dependence on foreign energy. S. 22 went out of its way to block off millions of acres from new energy exploration including hundreds of millions of barrels of oil and trillions of cubic feet of natural gas. S. 22 will lead to higher energy prices for American consumers until alternative and renewable energy technologies are available for the market. Potentially, we are looking at thousands of American jobs that will not be created. This at a time when we should be considering an “All of the Above” approach to achieve energy independence that:
• Increases domestic energy exploration and production;
• Incentivizes research and development of clean alternative and renewable energy technologies; and
• Encourages fuel efficiency and conservation.

United in opposition to S. 22 were organizations representing gun owners/hunters, fishermen, business, taxpayers, American energy producers, and property rights advocates. Less than half of the bills in this package received hearings and no amendments were allowed to be considered to this bill on the floor.

American People Demand Transparency from the Federal Reserve

As Taxpayers Continue to Fund Bailouts, They Deserve More Transparency from the Fed:
It is time for the Federal Reserve to be held to the same accounting standards that the American people must endure. During this economic climate when bailouts seem to be the norm, it is not acceptable for the American taxpayers not to know where their money is going and how it is being spent. I am proud to join Rep. Ron Paul as a co-sponsor of his bill H.R. 1207 “The Federal Reserve Transparency Act.” It requires the Comptroller General to audit the Federal Reserve and submit a report to Congress which will be made available to the public. Required in the audit report will be recommendations for legislative or administrative action.

Supporting Workers through E-Verify

Extending E-Verify is Necessary to Protect Jobs for Citizens and Legal Residents:
Last week, I signed a letter (authored by Brian Bilbray (R-CA)) from a bipartisan group of my colleagues to Speaker Pelosi and Leader Boehner asking that they include a long-term extension of E-Verify in upcoming legislation. I am concerned that any jobs created because of the President’s economic stimulus package will not go to legal workers since the Senate stripped that provision from the stimulus bill before final passage. Although the Omnibus Appropriations bill does contain a provision extending E-Verify until September 30, 2009, businesses cannot effectively plan unless they know E-Verify is secure. As the letter I signed suggests, E-Verify is successful, reliable, easy to use, and expedient. I look forward to working with Speaker Pelosi, Leader Boehner, and my colleagues to pass a permanent extension of E-Verify before it expires at the end of the fiscal year. 

This week’s votes on the floor, hearings, and markups

Each week I get the opportunity to represent you in Congress by: 1) voting on legislation that comes to the House floor; and 2) participating in committee hearings and markups for the Committee on Financial Services. 

Key House Floor Votes

Mortgage Cram-Down Bill Passes:
On Thursday, March 5th, I opposed H.R. 1106 the mortgage cram-down bill because it perpetuates the recent moral hazard policies of the federal government and does little to provide relief to people who have did not take out a larger mortgage than they could afford. I have received thousands of calls, emails, and letters from people all over the 24th District asking why they should subsidize others who may have made irresponsible choices. They wonder where their bailout is and why they can’t get their own principal reduced even as they continue to make their payments. Quite frankly, this bill was far too broad and lacked clear guidance as to how it should be applied so that those people who misrepresented their ability to purchase a home would not be covered by this bill. Furthermore, it throws good money after bad by “retooling” the Hope for Homeowners program which was part of the Fannie/Freddie bailout in July and has helped just 43 borrowers to date – far less than the 400,000 borrowers that proponents originally claimed would be helped.

The ramifications of this bill are far-reaching in that it will dramatically increase the cost of mortgage credit for all borrowers. Those who played by the rules and lived within their means by acting prudently should not be forced to subsidize those who did not. Mortgage lenders will inevitably be forced to raise interest rates, tighten lending requirements, and increase down payment requirements which will hurt those who can afford to buy a house. And, the effects of lenders having loans crammed down and having to absorb debts relieved through bankruptcy are that it will likely lead to costs being passed on to responsible borrowers. Another unintended consequence of this legislation is that it may actually encourage struggling homeowners to declare Chapter 13 bankruptcy. With even more losses being suffered by lenders, it is less likely that prudent borrowers will be extended affordable credit. Unfortunately, the amendment I voted in favor of to improve this legislation was defeated. Had it passed, it would have:
• Prohibited taxpayer assistance to any borrower that misrepresented or lied about their income on their mortgage application;
• Prohibited taxpayer assistance to any lender that failed to follow proper underwriting standards;
• Prohibited taxpayer funds from being used as incentives to lenders to rework loans for irresponsible borrowers; and
• Prohibited taxpayer funds from being used unless the President submitted a plan that provided equitable treatment of all mortgagors – not just those that are about to default.

Simply put, this legislation does not differentiate between prime loans (given to borrowers with good credit) and subprime loans (given to borrowers with a higher risk of default). It does not differentiate from those who may have fallen on hard times and those who are living beyond their means and bought more house than they could afford.

Committee on Financial Services

TARP and Main Street:
On Wednesday, March 4th, the Subcommittee on Financial Institutions and Consumer Credit held a hearing entitled, “TARP Oversight: Is TARP working for main street?” Testifying before the Subcommittee were: Dr. David Scharfstein, Professor, Harvard Business School; Dr. Dean Baker, C-Director, Center for Economic and Policy Research; Robert Davenport, President, The National Development Council, C. R. Cloutier, President and CEO, MidSouth Bank, NA, on behalf of Independent Bankers of America, Bert Ely, Principal, Ely & Company; and Joseph Zucchero, Owner, Mr. Beef Deli. TARP has not worked for main street. When Congress approved the second $350 billion a few months ago (which I opposed), there was no plan for what would be done (or done differently than the first $350 billion) with these funds that would help taxpayers without exposing them to further risk. Unfortunately, our Treasury Department has still not unveiled its plan for this money even as the economy continues to sail rudderless through the fog.

Mortgage Lending Reform:
On Wednesday, March 11th, the Subcommittee on Financial Institutions and Consumer Credit held a hearing entitled, “Mortgage Lending Reform: A Comprehensive Review of the American Mortgage System.” Testifying before the Subcommittee were representatives from: Conference of State Bank Supervisors; Division of Consumer and Community Affairs, Board of Governor of the Federal Reserve System; National Community Reinvestment Coalition; Center for Responsible Lending; National Consumer Law Center; National Urban League Policy Institute; National Council of La Raza; American Bankers Association; Mortgage Bankers Association; National Association of Mortgage Brokers; National Association of Realtors; Appraisal Institute; and National Association of Home Builders. This hearing was a precursor to Chairman Barney Frank reintroducing a subprime bill from last Congress which the Senate did not take up.

Recommended Reading

This week, I am introducing a new feature to the e-newsletter which I hope you will enjoy. Here, I will share with you an article or articles which I found particularly thought provoking and informative. The piece I have posted here is a thoughtful article by Charles Krauthammer that originally appeared in the Washington Post entitled “The Great Non Sequitur.” http://www.washingtonpost.com/wp-dyn/content/article/2009/03/05/AR2009030502951.html?hpid=opinionsbox1

Great Quotes in History

"You cannot legislate the poor into freedom by legislating the wealthy out of freedom.  What one person receives without working for, another person must work for without receiving. The government cannot give to anybody anything that the government does not first take from somebody else. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that my dear friend, is about the end of any nation. You cannot multiply wealth by dividing it."
-Dr. Adrian Rogers, 1931-2005, former Sr. Pastor of Bellevue Baptist Church (Memphis, TN)

I am honored to represent the 24th District of Texas, and appreciate your interest in my e-newsletter.  Please contact my District or DC office with any further questions you may have or visit my website at www.marchant.house.gov.