Tuesday, September 30, 2008
A Message From Congressman Porter to the Citizens of Nevada -- 3rd District Nevada
On Monday September 29, 2008 the House of Representatives voted on H.R. 3997, the Emergency Economic Stabilization Act of 2008. This legislation failed to pass the House by a vote of 205 to 228. I joined 204 of my colleagues in voting in favor of this important legislation intended to stem one of the greatest economic challenges our nation has ever faced. I understand that many of you are angry at Washington and Wall Street for this crisis. I also understand that many of you are fearful about your own economic security and are feeling the pain of this economic uncertainty. Please let me take this opportunity to explain how we got to this critical point and my reasons for supporting the Emergency Economic Stabilization Act of 2008. This crisis began with the bursting of the housing bubble and high default rates on subprime and adjustable rate mortgages, beginning in approximately 2005-2006. Once housing prices started to drop in 2006-2007, in many parts of the country, especially in Nevada, refinancing became difficult. Subsequently, defaults and foreclosure activity increased dramatically, during 2007 nearly 1.3 million American housing properties were subject to foreclosure, up over 75 percent from 2006. In Nevada, we are still experiencing the highest rate of foreclosures in the country. Clearly, Nevadans are hurting and need immediate relief. This housing crisis has in turn affected mortgage lenders that retained credit risk and other financial institutions. As of July 17, 2008, major banks and other financial institutions around the world have reported losses of over $435 billion. Corporate, individual and institutional investors holding mortgage backed securities and collateralized debt obligations have experienced significant losses as the value of the underlying mortgage assets declined. As various institutions default or lose the ability to function as independent economic actors, other sectors of the economy suffer, especially small businesses. As a matter of fact, I have a friend that just shared with me the pain her small business is facing. She went to her bank to make a deposit so she could pay her bills and the next day her bank closed its doors. She lost tens of thousands of dollars, more than half of her deposit in one day's time because of the bank failure. She is now struggling to make her payroll and pay her bills to keep her business thriving. Most recently, Bear Sterns, Lehman Brothers, Merrill Lynch, Washington Mutual, Fannie Mae, Freddie Mac, and AIG have become casualties of this economic crisis. In situations like this, it is my duty and responsibility as a Congressman to take action. That is why I was elected to Congress. I was elected to represent my constituents in times of crisis and uncertainty and to make difficult votes like this. When I took the oath of office, I promised to do what I thought was best, especially on days like yesterday to protect Nevada and my country and that is exactly what I did. Beyond that, I believe it is my responsibility to find out what went wrong, when and then to hold those individuals responsible with criminal, civil or legislative actions.The economic indicators show that we are on the verge of a national and international financial collapse. I believe the time for leadership is now which is why I supported this legislation. I am convinced that this was the right thing to do for Nevada and our country. I voted to protect taxpayers and to stabilize our economy.I have received hundreds of calls in opposition to the original bill, which I also opposed. The original bill was irresponsible and a blank check to Treasury. I also fought hard to eliminate provisions the Democrats were insisting on such as creating a slush fund for ACORN and provisions allowing bankruptcy judges to reduce mortgage principal under the guise of helping those at risk of foreclosure. Although the final version was not perfect, this legislation protects taxpayers, eliminates golden parachutes, puts those responsible on the hook, and includes my legislation calling for an investigative commission. While my legislation would have gone further in providing recommendations designed to guard against future collapses within our financial markets, I believe that this is a good step in preventing future challenges like we face today. My legislation called for a Special Commission to investigate the collapse and recovery of our financial markets and related agencies. It would be an independent commission to explore circumstances surrounding these failures including the extent of regulatory preparedness for an immediate response to the situation and provide recommendations designed to guard against future collapses within our financial markets. I think it is morally reprehensible what the mismanagement and greed on Wall Street has done to the American people and to our economy. I am angry with Congress for allowing such drastic and continual cuts in regulation. History will show that Congress cut, cut, cut for year’s protections put in place after the Great Depression which were there to protect American's from another depression. I am angry with the Administration that their checks and balances did not act or catch this before we were headed to such a crisis. I also believe some families made poor decisions and got themselves into mortgages and loans they could not afford. All of these circumstances created a perfect storm.So, what's next? We need to roll up our sleeves and work together. Congress must return to work as soon as possible and lay aside the personal and the political attacks and differences. We must rise up together and come to a solution. I firmly believe that we can. I believe we can bring our country together and as American's come together in this time of need. The politics of blame and personality have gotten us here over the years – you can look back and blame Nixon, Carter, Clinton and Bush. We must lay these politics aside and find a solution.Let's stand up as Americans and work together on the business of healing our nation. Again, I believe that the right vote was a yes vote and a no vote was the easy vote. We need true leadership in these trying times and that is why I voted yes on this bill.