that are "too big to fail." we have pass an economic recovery act, health insurance reform, education reform, and now we're on the brink of passing wall street reform. at the g-20 summit this weekend, i will work with other nations to coordinate our financial reform efforts and promote global economic growth, while ensuring that each nation can pursue a path that is sustainable for its own public finances. at the main forum for international economic cooperation, the g-20 is the right place to discuss those issues. over the last few days, i hope we can build on our past progress and strengthen the global economy for a long time to come. brass is very much, everybody. -- thank you very much, everybody. >> president obama is in canada this weekend for the g-8 and the g-20 summit.

negotiators gave final approval to the bill this morning after staying in the entire night. it is the largest rewrrte of a rule since the great depression. it now has to be voted on by the full house and senate, which we expect to happen next week. right now, we'll show you the last 20 minutes as the negotiators the their final approval and then spoke with the press. >> chairman, i now intend to put to a roll-call vote the completed package which we have before us. i ask the court to call the role of house members. we will then have the senate members. i asked the court to call the roll of all house members who are entitled to vote on this. >> i have to ask consent for that to occur. >> we ask unanimous consent for that to occur. the effort will be to get this bill on to the internet as each title is produced.

we expect to vote in the house on tuesday. >> mr. chairman, when would we enter that -- to seeing those amendments? this bill is quite technical. >> could i ask the staff -- as we produce them, some tomorrow -- i would certainly object to any staff member who came in here before noon tomorrow. [laughter] yes, today. [applause] >> senate staff will be at their desks at 8:30 this morning. we'll get them as soon as we can. i ask that the clerk now call the roll on passage of the financial reform bill. all members of the house are entitled to vote on the final bill. >> mr. chairman?

>> no. >> no. >> no. >> mr. hensarling votes no. >> mr. garrett votes no. >> lucas no by proxy. >> no, by proxy. >> issa? >> no, by proxy. >> mr. graves? >> no, by proxy. mr. schumererkc, votes aye by proxy. >> what is the tally?

>> 20 ayes, 11 nays. >> the house sends you its approval. >> let me congratulate you on a terrific job. we will now vote on the senate side. those in favor aye, those opposed nay. the ayes have it. i will ask the clerk to call the roll. >> mr. chairman? >> aye. >> aye. >> aye, by proxy. >> ye. >> aye, by proxy. >> aye, by proxy. >> mr. shelby? >> no. >> mr. crapo.

>> no. >> mr. corker. >> no. >> mr. chambliss. >> no. >> the clerk will report. >> 7 aye, 5 nay. the bill is passed. hank my colleagues. [applause] >> with the votes of the house and senate conferees in favor of passage of the bill, i declare the bill passed and the conference committee is now adjourned. [applause]

>> nice to meet you. take care.

>> congratulations. >> congratulations.

>> we recognize the remendous efforts of staff. it has been nothing quite like this. as is as good as it gets in terms of a legislative effort. this makes a huge differencee no one thought we could get this done. it is a tough environment to operate in.

to establish a consumer protection bureau for the first time in the history of our country, to stop the too big to fail, to ensure that we do not end up with another near financial collapse. we will provide an early-warning system. it is another of the great pillars of this bill. >> how will this work? >> we believe it was needed for a long time. it was exciting to bring it to where we could get this done. it is a terrible way to have to do this. we have people like barney frank leading the house effort. we have great people like harry reid and nancy pelosi making a huge difference for us, giving us the space an opportunity to do this.

this has been badly needed for a long time. we hope to protect our country. we hope this will bring optimism and opportunity to our financial systems. it is a great moment. i'm proud to have been here. >> i agree with the senator. it is an extraordinary experience, obviously. we hate to have the kind of crisis to have dick get it done -- to have to get it done. we try our best and work together. we hope that the legislature will be ready. if you intend to focus, as you do, understandably, on the

controversy, by definition, controversy over the last little pieces, people will forget how far we have come. the negotiation for the consumer protection agency, the the volcker rule, the widespread reform of derivatives -- those were all unachievable years ago. in every area where we have touched, we have made significant advances. i would also say that it is a tribute to the way american democracy can work. there was a difference in this bill. last year, when we were debating in the house, health care was getting all the attention. it was not as good of a bill as i would have liked to bring out. we were not getting public attention. people were not -- people with an economic interest were not moving forward. this was a much tougher job than

the 60-vote majority. it will be more difficult. with health care, the american public began to focus on this. it has made an enormous difference. this is better than it would ways, because the american public focused on it. i hope we will give people a sense -- we worry about big money. it is reassuring to know that public opinion gets engaged and can help win. not i agree. -- our staff are extraordinary. putting a lot of time in a stressful condition, for far less money than they could have made elsewhere. >> do you think you'll have a majority? >> i do not know that. we'll see what happens in the

next few days. i have stayed in touch with the the republicans in the senate who supported the bill coming at of the senate. i've had daily communication with them as to inform them how things were proceeding. i have asked about their thoughts. i dr. chairman frank about these things and he was a very aware of it -- i talked to chairman friend about these things and he was very aware of it. they were very interested in the proceedings. they were interested in things. it was a very good relationship. i cannot tell you today. i have to talk to them over the coming days. i hope we will see a bill -- a stronger bill than the one we came out of the senate with, with all of the things they're interested in and a bit more, because we were able to prove -- improve some ideas. i thank the house members and

chairman frank for understanding that. we're in good shape. obviously, i'll reserve judgment until i can talk to my colleagues. >> on the volcker rule [unintelligible] >> of the chairman has made the point -- maybe it was not made often enough -- this bill is not done yet. the president may be on his way now to toronto. he is on his way to the g-20. why we have not completed it, the harmonization of our rules -- it will be awfully important. united states, having completed this work, we open the next week, can offer some leadership to the world in what needs to be done to harmonize the efforts we have talked about this evening and recently. i think it will strengthen the hand of our president going to toronto to make that case. we believe with a passion in this bill. we hope will occur next week. we can make the case where

follow -- fellow parliamentarians, union leaders, and others. they could embrace the principles at least of what we have done. adding it levant's the stability and predictability, as well as a kind of wealth creation and job creation that we desperately need. >> first of all, there articles today in the newspaper -- there were articles in the paper saying we would be debating. europeans seek blil -- bailouts. they want to tax their institutions to pay for their recovery. this is what we did today. the british -- the conservative, british government has just beat up to the punch -- be as by the punch -- the us to the punch by

a few days like setting up of consumer protection agency and dissolving their financial agency. we need to not separate out consumer, some said, but they did exactly that. there's a great deal of -- we put in the hands of the president of very powerful set of rules. we're trying to get other countries not to -- to stimulate and help us defeat unemployment. i think we're making it very clear that the president is a world leader. you'll see continued conversions. >> thank you. >> senator, are you confident of the derivative language that is central? some of other -- some other folks that concerns. are you going to lose any of them on the floor? >> i am not. i believe there will be a majority. there were some people who voted -- a handful who voted against it from the left.

i sympathize with a lot of my democratic colleagues. they're very thoughtful people. i understand their concerns. the amendment as adopted moves in that direction. one of the concerns i had was the amendment of senator lincoln -- what we thought was an inappropriate application of fiduciary response ability. we heard complaints. we have modified that. with a very strong code of conduct. we have some of the things. i think some will vote no. i'm pretty confident that we have a majority here of house members. unfortunately, it appears in the house that the republican party is going to repeat its pattern of simply voting no and everything and being status quo. we'll have enough democratic votes. >> is july 4 syllable? it is. -- is july 4 still the goal? it is. >> thank you very much.

>> thank you. >> we win. >> here are some of the components of the bill. it would establish an independent consumer financial protection bureau. it would be housed inside that a reserve. it creates a new 10-member oversight council to look out for major problems throughout the financial system. it would also aim to make the trade of derivatives more transparent. it would force most derivatives to be bought and sold on clearing houses and exchanges. right now on c-span, debate between house and senate negotiators on the derivatives portion of the bill.

>> what i would like to do is take a couple of minutes and then turned my colleague from arkansas, chairman of the senate ivar -- the house agriculture committee for a longer response. but may take a few minutes and give -- let me take a few generaland give thaa response. a lot of work went into this. the house sent over 110 proposals for amendments to the conference-based text. literally, all night, my staff stayed up through the entire evening. they went through these 110 proposals. we accepted 85 of them. a lot of work went into that. 15 of which we modified. there are 25 proposals that we respectfully rejected.

i will try to do this quickly and then turned to senator lincoln for any additional comments that she would make. let me go through the high points of our senate counter offer. this package, we believe, will strengthen the capital and margin requirements provided for a more robust swap execution facility and tougher reporting requirements for cleared and uncleared swaps. the proposal will tighten the definition of major swap participants, while providing guidance to regulators to consider and entities collateral and positions in cleared vs uncleared swaps. we ensure that the end users will be exempt from query and exchange-trading requirements, so that they can continue to hedge their commercial risks. the package strengthens the role of a 40 -- authority and regulators. it also clarifies that banks may

be permitted to push out there swap businesses got into affiliate's, providing a transition period for doing just that. this package opposes -- imposes tougher penalties on parties who would violate the clearing requirements and mandates of regulators. in addition to the tireless lincoln, herrman staff, and others, very important contributions were made by senator that read -- senator jack reed, senntor leahy, senator feinstein, senator cantwell. like in all negotiations, there are simply some things that one side or the other have a hard time accepting. this process is no different. as i mentioned before, there were some things that we just did not accept. for example, we are rejecting the -- we propose preserving the

text which presumes these contracts are regulated as swaps, unless the secretary of the treasury makes a written determination that they should not be regulated as swaps and are not structured to evade the act. we have listed criteria and that the secretary of the treasury must consider in making this determination. many of our colleagues believe strongly that this is one of the more responsive -- a more responsible approach to regulating the market that is so large and so complex. secondly, we respectfully reject the house's proposal regarding cftc and the federal energy regulatory commission authority and preserving the language supported by senator bingaman, senator chambliss, and others. thirdly, we rejected a number

of whistle blower provisions. some of my colleagues believe these will weaken the cftc was a lower production program. fourth, we rejected the house offer on the lynch amendment, which imposed strict ownership caps on dealers and other investors in clearing houses and related entities. we strengthens the base text language to require legislators to -- regulators to write rules to permit -- prevent conflicts of interest, including limits on the control and ownership of clearing houses, exchanges, and other entities. we have added some language requirements to require the leg relators to consider any -- the regulators to consider any, but that may arise. i would also add there are other proposals which may be rejected, but i wanted to provide -- highlight at least those that . title vii is possibly the most

complex of all of the titles we grappled with. the financial reform bill. many of our colleagues have spent countless hours grappling in dealing with this very esoteric area of the financial- services sector. i want to commend them for doing so. it is a very difficult job. they have spent hours to increase the transparency and accountability in what is a $600 trillion derivatives market. $600 trillion services market -- derivatives market. this is very important. this one is profoundly important. i would like to turn to my colleague. he has done a great job with this. >> thank you, mr. chairman. i want to thank you and chairman frank for your leadership and

hard work, as well as your staff. i also want to thank my colleague for his hard work and the ability to work together. there is a lot that has been done. the magnitude of this task has not been lost on anyone over the last few months -- certainly not myself. we've heard a lot of talk about risk, job loss, stability. i think we have worked very hard, in coming together to find common ground and to, more importantly, avoid the kinds of circumstances that our constituents have suffered from in the financial crisis that we've gone through in this country. we have looked -- i have particularly -- looked very basically at what do we need to do. my focus has been on ensuring that banks should be banks and that risky business should be dealt with differently than it has been over the past few years. the senate's counteroffer on

title vii has been very well described by chairman dodd. it is a testimony to the importance of working together and pulling together good ideas, good minds, common ground, to find common sense solutions to these issues that our nation has faced. the challenge of negotiating a complicated bill isn' finding a way to move forward and make it work for all sides. our financial system is complicated, integrated, and our time is limited. we could not afford to begin our heel -- dig in our heels. i would note to my colleagues that much attention has been focused on the section 716. i would also suggest that you look at the rest of what has been done. it prevents future bailouts and addresses too big to fail in an honest and sure way. the federal reserve and ftse will be prohibited from

providing federal funds to bail out wall street firms. it will make banks get back to being banks. for the the bus -- for those of us who grew up in small towns, we understand how important it is to those who want to create jobs and access to capital that traditional banks have been able to offer. >> lower systemic risk as we require mandatory trading and clearing. that is exactly why we move in that direction. we also bring 100% transparency to market with real-time price reporting, which is absolutely critical for knowing what is out there. the only reason we now know what is behind us is because we have looked into a rear view mirror. this gives us an opportunity to see what we are dealing with and what is ahead of us.

we protect municipalities and pensions. investment in visor's will be required to put the interests of the municipalities and pension funds, as well as retirees first. we regulate foreign exchange transactions. they will be done in banks, but they will be regulated. we increase the authority to punish bad behavior. legislators have been given broad authority to punish wall street firms to knowingly helped their clients defraud third parties or the public, such as the swaps and that goldman used to mislead the european union. i believe that we have found a way to regulate our financial system while protecting main

street businesses and commercial users who are the lifeblood of our economy. we looked at users who used these swaps to be able to manage the risk of 100% of their commercial revenue. that means we do not allow them to use it for speculation, but for commercial and rest. this retains a core of both bills. we target the largest, the riskiest players and i expect more of them, as we should. we walk through it thorny jurisdictional disputes and send a message to our regulators that they must cooperate and focus on the market and not each other. we provide robust, real-time transparency. these markets cannot work without trade information. we retained the 716 and ask the

banks to get back to banking. for those that are hedging commercial risk we provide flexibility for the regulators. we increased anti-fraud and anti manipulation authority. we tightened upon regulations on swaps and swaps dealers so that we target on the we need to target. we focus on risky behavior and not legitimate hedging activity. >> there are matters that are having trouble hearing. good people in the room keep more quiet? >> thank you. i appreciate that. we do know that risk is something that has to be managed. it is an important to look, and we want to maintain accurate we took a stand against big, speculative money in the commodities market. we balanced the critical need to

deal with conflicts of interest and the need to encourage a free market. most importantly, we looked at those who would be impacted and adjusted accordingly, maintaining the strength of the two bills without harming our economy. mr. chairman, to all of you all, chairman and colleagues, this is such an important path. i know everyone here takes it seriously. i certainly do. in listening to my constituents who have approached me about the serious nature of the economy that they have experienced, whether is losing their children's college funds, their retirement savings, they want us desperately to get this right. i look forward to the diicussions that we have, finding a solution, and moving our financial regulatory system ford -- forward. as always, i come in search of common ground and more

importantly, with a look to do what is right, and with an open mind. thank you. >> let me invite our colleagues here. senator chambliss, do you want to be heard? >> i do not have a comment. i have an amendment when you are ready. >> senator reid? >> i do not have anything. >> then let me turn to senator chambliss for his comment and amendment. >> while i appreciate the comments of both chairman petersen as well as chairman lincoln with respect to title vii, we just passed a very strong volcker role. the rule that came out of the senate was in itself a very strong rule. tonight, according to the chairman himself, we have strengthened in that role even more. the end result of the volcker

rule is the exact same end result of that is thought to be achieved by section 716, and that is to eliminate risk taking associated with proprietary derivatives trading by banks. what section 716 does is it moves outside of banks to the swaps desk. the volcker role in effect does that by eliminating the ability of banks to trade in a proprietary way. since the volcker rule specifically does not allow banks to use their capital to engage in proprietary risk taking, that means that the risks associated is thereby eliminated. section 716 is bad policy. it is bad -- it is good policy to promote safety and soundness. banks need to be able to hedge

their own exposure. it is also good policy to promote responsible lending. bbnks should be allowed to do direct hedging of a customer's business transactions. 716 prevent both of these, eliminates the bank's ability to hedge a customer's transaction. without further discussion, i would simply say that 716 is unnecessary because of the volcker rule, and it will result in banks not being able to hedge their own and their customers risk, and i would encourage the adoption of the amendment. it is a man and number two, which i understand half -- it is an amendment no. 2, which i understand has been distributed. >> i have to believe that as we look at what we have done here,

the volcker rule does eliminate proprietary trading and provides us, again, more stability, but it does not deal with the market making that also happens. i think section 716 is all about to beingbanks back banks. the ig failed and the u.s. government had to -- aig failed and the u.s. government had to pony up billions of dollars. clearly, swaps and dealing is a risky activity picked it is something that we need to deal with, more for investment banks began commercial banks. banks should be making mortgages and small business loans, not playing with swaps. our hope is that we have looked at what we do in moving as much as possible the risky nature of this business out of banks, allowing banks to be banks, and

ensuring that the riskier nature of businesses are put into an affiliate where they can be dealt with accordingly. we have looked at how to move these things, and we have looked at what has traditionally in the past been permissible for bank activity. that is how we have lined it up. over the last decade, we have seen more bank principles of being taken up in banking. that is not in my opinion the place where it should be. banks should be banks. we look back to what those core principles of banking are, and we make sure that those activities that have been non permissible as core principles in banks are taken out of the banks and put into an affiliate to preserve the safety of depositors and to preserve the safety of the taxpayer. so, i regretfully disagree with

the gentleman from georgia, and would strongly encourage my colleagues to oppose his amendment. >> mr. chairman, just very briefly if i might. derivatives trading is a part of banking. we need to keep banking activity inside the banks. we also need to provide 100% transparency, which the bank still does. chairman lincoln is exactly right, that there have been some dark trades that probably participated in the cause of the financial collapse. aig may have been one of those institutions that participated in that, but all of the trades that aig dead under the base

bill would now be required to be reported to the regulators. that was not the case before. this will require additional capital to be forced out side of the banks to a different entity, capital that could be used for loans to businesses to expand and create jobs. now they will not have the capital available for that. those entities that want to trade in the dark are still going to be able to do so. there is nothing to prohibit any entity from continuing to trade derivatives on overseas markets. those transactions do not have to be reported to u.s. regulators. what we ought to be doing is incentivizing every single american derivatives trader to trade on the u.s. market. what this provision does is incentivize those folks who do not want to have the expense of having their trade cleared, those entities who want to

continue to do business as they are doing it today, to trade overseas bourses trading on u.s. trading in reversversus u.s. market where transparency would take place. >> again, i do appreciate my colleague from georgia, and i would say that banks are still allowed, under this piece that we have received, to be able to trade in derivatives. they are just simply going to be swapped as derivatives that are traditional and meet the core principles as banking if they are going to be traded in banks. if they do not meet those core principles, they will be spun out into an affiliate. and they will be dealt with with additional capital.

the gentleman is right. that capital probably would not be taken up. but the fact is, if they are doing riskier business, the whole problem that we had was that that risky business was not appropriately capitalized. so, i hope we will look at what we are doing, because i do think that the riskier nature of businesses do need to have the additional capitalization, and i think it is only fair to the taxpayers and only fair to the depositors and others and that that business come out and that it be appropriately capitalized. i appreciate the gentleman, and it certainly appreciate the time. >> does anyone else wish to comment on the chambliss amendment on the senate side? >> the goal here is to have a robust markets that does not

have systemic risk to the extent that we can accomplish that. the way you get to that point, of course, is by having transparency and by moving as much as you can on to clearing houses and exchanges, which this bill attempts to do. spinning out of the swaps desk does a very little in the area of putting more sadness and safety in the system. as the senate majority leader has pointed out, it will probably lead to a very significant detraction in credit and derivatives for no apparent gain. it will not make it safer or sounder. safety and soundness of the derivatives market will come from higher margins, higher responsibilities, higher liquidity, as a result of foreign activity, or from having these exchanges. there really is not a substantive and gain a sub -- a

substantive gain in this proposal. there is obviously a political gain. up what you're going to end with is that banks are going to have a lot less credit. we will have less credit in the system, and that will lead directly to main street. they will find it more difficult to get the credit they need to pursue entrepreneurial activity which will create jobs. i am afraid that if we pursue this course of action, we will see a contraction in the availability of credit in this country, and that businesses will move to the overseas markets. we can address derivatives without having to force them overseas. i think the senator from georgia oppose the amendment makes the most sense. >> is there further debate on this amendment?

if not, let us have a roll call vote. i can see my part. -- i can see mike clark. my clerk. >> mr. chairman. >> no. >> mr. reed. >> no. >> ms. lincoln. >> no. >> mr. leahy. >> mr. leahy know by proxy. >> mr. shelby. >> know. aye. >> mr. crrdo. >> aye.

>> mr. chambliss. >> aye. >> the measure fails. >> this measure creates a consumer financial protection bureau the gives regulators the power to break up large, failing to financial companies that pose a threat to the greater economy. there are also a number of restrictions on banks that trade in derivatives. the white house and democratic leaders are hoping to have a final vote on the measure by july 4th. here is more on the debate on how the bill is being paid for. >> next, a look at oil spill cleanup efforts in a louisiana parish.

>> i am under the weather. how are you doing? i came in to see you all. >> take care of him. he is so special. >> well, let us go upstairs. >> he is like my little kid, because they went to school together. >> i knew i was going to shut down soon. >> i am amazed you are on this long. i was worried about getting through.

[unintelligible] >> do you know jackie? >> it is nice to see you again. >> this is danielle, from arne's office. >> [unintelligible] [inaudible] >> we went to high school together. then she went off to be a movie star. [laughter] >> are you feeling better today?

>> i feel a little bit better. i still have a fever. >> get him out of here pretty soon. >> i do want to tell you, so you understand what we did. early on, we saw right after the accident, we knew it was bad. they said the disbursement would make it sink and it would not come ashore. we knew we had to stop the oil out here. we sent out a jack up boats. they kept telling us we do not need that, it is not coming ashore. we needed to put a plan in place. we put boats here on this side. as the oil came in, we put additional boats out. from these boats, we would ride

the coast every morning and every night looking for oil. the first oil to come ashore came during a storm. the next morning it was there. it was over in this area. three weeks later, it still had not been cleaned up. it killed everything in that march. >> why did it take so long? ?hy didn't people mobilize everybody was so worried about what was coming out of the ground, but nobody was worried about what was hitting. isn't that as important as what was coming out? >> also, we have seen fish and dolphins die. from here, they can swim away. hear, if it comes in, a blanket and smothers them. >> and it destroys the wetlands and the wildlife. >> it is really heartbreaking to see what it has done.

three weeks later, they still did not have a plan. the governor and a lot of local leaders came up with a plan. >> i saw that. >> we went out and embarrass them into doing that. today, at two o'clock, i will not be there because i am under the weather, but kevin costner is going to have his machines put to work. his machine takes all of the water, but it put the water back with less than 1% of the oil. >> how many boats of his did they use? >> 20. we are asking for 18 of the small units here. the larger units will go to the outer area islands and try to suck up the big stuff. we are losing the battle, so

today, once again, we embarrass them into doing the right think -- embarrassed them into doing the right thing. they're going to deploy the first ones. i just got a call saying they are going to do it today. >> hi cannot believe eliot ness -- i cannot believe eliot ness has come back 25 years later. [laughter] >> but we have got it now. every one of these dots is where we have got oil onshore. >> it is awful. >> what is going to happen is that every time the wind blows, more is going to come.

our big fear now is that if we get a hurricane or a small tropical storm, it will blow back up into this pocket. it will devastate the west side like it did the east side. >> does he have hd machines? >> he has 30. intore going to take them what is called blue water. right now, they are in what is called ground water. they're supposed to give us 18 of them. i think the pressure of bp yesterday shutting down for the safety inspection -- >> you heard about that? a shutdown charges because of life preservers. i mean, come on.

the coast guard did that? >> my opinion is admiral allen -- i am not after the guy, the u.s. in the comment. -- but you have seen the comments. he uses consider, might, maybe. he should be pulling out all stops and making all of the things that can pick up the oil deployed. he said he would not order it skimmer's because they take two weeks. i said, at do you think this will be gone in two weeks? >> get them now. >> what could have been done and

what should have been done immediately and what was going to be happen and what they could prevent, i told them to circle the wagons. i told him publicly the other night, we told you all to listen to the local parish presidents, circle the wagons, get them in a big circle around the well, and don't let it pass there. >> i am thinking, where are all the boats? where is it? every military the we own? >> it is hard to understand. even the numbers they are putting out there, 26,000 people on the ground, i still do not believe that.

i have asked them to put one of my guys in a helicopter, and they have said they are going to do it, but it is yet to be done. >> the man from the animal preserve was saying that people should be out on the beaches collecting the animals at 6:00 a.m., and nobody is there. >> they have them trying to crawl back up, covered with oil. what happened is, we had a meeting here yesterday because the person that bp hired to be over the animal thing tried to keep me and the governor out. we had to say get out of the way, we are coming in. that is how you have to do it. >> how are you doing?

nice to see you. nice to see you. >> it is good to see you. >> he said, you know, they want to keep you out, and it is a contractor talking about the third place. so the state wildlife people met yesterday. i was out sex. but they said the -- i was out sick. but they said the wildlife people will not let you in. they're making up their own roles. >> people are lying. >> when i showed up it was like, if we knew he was coming, we would have let you in. they are making up rules like they are taking these pelicans and saying, we leave them for five days until they calmed down. i am lite, show me that role. it is not true. -- i am like, show me that role. -- rule.

that is not true. >> there are hundreds of people waiting to come and help. wildlife experts waiting to come to our shores. wyatt are they not here? >> there is a group from australia that was told to come and help. they got to venice. they were told to go back home. from australia. a guy came to see me here is what we're doing, because we ask them to add another bird place where it is shorter to transport the birds. what happened, what i believe is they are trying to keep their amount of work spread out. like, we might bring in 100 birds, and if they clean them all up as quickly as possible, three or four days.f work for they keep three or four pence of

pelicans for up to a week sometimes. that is inexcusable. you can see the pelicans. >> they are covered for days. >> they say they are letting them calmed down. that bird has not moved because it is stuck in a while. >> who made that role? >> the contractor. >> but that is a bp decision. that is not the expert. i can remember the person's name, but he said he has teams of people. >> we need to take them responsibility away from the contractor and give it to the federal wildlife overseer. >> they were performing better than most of the state. it was mitch that mobilized

them. >> it seems like everything we are dealing with is a problem because bp is in control and they are trusting in contractors, but they do not have anybody on the ground that can say, no that is the wrong way, we are going to do it this way. >> how do you finally get someone to move bp out of the way? >> that is why we're having a meeting with federal wildlife. now they realize they are not in control. nobody from their ever showed up. >> can obama make it official that bp and no longer controls your territory? >> that is supposed to be official now. but would love to be sitting around a table working on every issue i would much rather be cleaning up the oil then -- and

yelling and screaming. there are a lot of coast guard people here and local bp people who are great, but we have to get to a point where when something needs to be done, i can grab that person and tell them how to fix it. >> you have four states being affected directly right now. why is there not a single point person with, number one, coast guard, number two, a bp, so that you as the president of the parish, when you have an issue, you have one single person you can go to, whether it is a wildlife issue, of the issue, a cleanup issue? that does not seem to be that difficult of a process to create. >> on the one hand, i appreciate the sand they have said -- sent.

>> you have seen come at sam has the authority. he can pick up the phone and make one call and get things done. but he never gets an answer back. i feel like a lot of the bp people on the ground to do not have the expeeience are relying on contractors that are more interested in putting bodies out there to make money than they are in cleaning up the oil. >> whoever is and that is the local, state wide contact, not only needs to be named, but they need to have authority and decision making power so that they can make the call, so that you do not have to go to the person and they have to wait for the coast guard or bp.

there has to be more of a process of control created year to get things moving faster. >> we told them this is the way we think it needs to be done. we need every ship in the world with a skimmer to fight it off shore. that needs to be a separate group garrett on the beaches, we need -- separate group. on the beaches, and we need people to keep the oil from coming up. and thee need to be stationed on the viet 24/7. -- on at the beach 24/7. then a group to handle while alive. it can be done -- wildlife. it can be done. but you have to do it at first

light, late evening when the water is calm. then you have your team in the marsh. they suck the material going to the top of the march. the last part of that team is going to be -- and they better be doing it now, one of three things. something to preserve the march to give wildlife a chance to come back, something to get the sticky stuff off, or something to set it off. they need to test all three. once we get the oil out, i am not an expert, i do not know what the best thing is, but something needs to be testing something so that when it is time to do that, we have the best chance to save the marsh. all of these teams need to be

deployed, and they need to be deployed by area. if he is in charge of this area, we call him up and he brings a team there. if this team has no oil, they can come over to help this team. now, we know more is coming. we know the wind and the waves are going to pick where it goes. we should have a team -- like i started out on one team and had to go to another. they know what they're doing. today, we started picking up oil. it is not getting picked up. we take it, but it in a bag, off and bring it back to the dock -- put it in a bag, tie it off, and

bring it back to the dock. we got a 50 gallon bags. tomorrow, if it works, we bring in 40 it more. >> you want to have 14 vacuum teams. that will work. if bp does not put the boats out we willcle the oril, put three teams out to do it. >> and those are ready to go out. we had a delay, but they are back and ready to go out. >> the thing that frustrated me was, if i am out in my boat and the coast guard calls up, they want my life jacket and my registration and my commission.

they do not shut me down, but they can come aboard. i do not understand that. i have been on offshore vessels where the coast guard pulls up and they go through the whole vessel, and then they get off and leave. why would they shut them down? why wouldn't they just send life jackets to the boats? >> is frustrating. it is hard. >> who is going to be out -- why isn't somebody else out raking in the oil? >> they are not flexible. you need someone who is flexible. >> that is why the eyes and the years we have out there are so important. i was glad the president approved that. we need additional votes.

we could be more on top of it. we had eight votes on standby. in the end, he thought it was a good idea. >> i think obama should make you in charge of everything. >> no, no no. [laughter] >> you should just move to the white house. he owes you money. [laughter] >> i know she was saying that in jest, i think, but to take that point, why not have a daily cabinet meeting, at two or three times a day, where you and the other leaders from the affected parishes, the mayors, all on the

phone at least once or twice a day directly with washington so that they can make those calls directly with that conference call. >> all we get from the white house is we will take that into consideration. >> i think obama should be on your speed dial. >> the thing is, in venice, in grand isle, wherever the command centers are, there should be one coastguard, one bp, and the parish president, and i should be able to go down and get an answer to anything. >> you should be in charge. people here know the area should be in charge. we said for any parish, do what the president needs.

we-irresolution like that -- we did a resolution like that. we give you all the power. >> some of the naysayers have been because they did not want to spend the money to do it. you know, if you have something out here, it is going to catch the oil. the governor changed having the coastal plan. if you go look at the oil, it is this outfit washed up on the beach. -- this is thick washed up on the beach. >> one of our council members was concerned about the scientific criticism of the berms, she weighed in on it. i said that was not specific to

that areaa the criticism was whether they would do everything and globally. >> of the president said we are going to have a discussion and within two or three days i will give you my answer. so we had a hearing. the hearing was a bunch of naysayers. afterwards, i said i was going to call the white house. i left the meeting. i went outside and had an interview. they said we were going to give the parish president and the governor chance to speak. i was ok with that. we all spoke. at the end, the secretary stood up and was giving her point of view.

i asked if she was for or against the berms. she said she was ok with them. i said i would take that as a yes. >> she tell me why we should not do it. >> are you for or against it? i said, anybody against it, raise your hand. they are all for it. nobody here said they are against it. i was on conference calls for weeks leading up to this. at peoples said water flowing over there was helping the snails live. at the end of the call, i asked everybody, before we have, anybody wants to say and do not do the berms, because the alternative is oil in the marsh, nobody would say no.

they would say why we should not do it all along, but to this day, i cannot find one person who will say in a yes or no fashion that know they would not do it. >> a couple of people ask me why we were pushing burns if they were scientifically acceptable. i said they were not unacceptable, they were not preferred. but that is in a perfect world. this is a whole different picture, and that is what they are not taking into consideration. >> i flew over yesterday, and i got goosebumps flying over. the federal official said these should be built back bigger and stronger than they are now.

but because of the challenges of the naysayers, and this is the federal wildlife people who said they have been trying for 20 years to add dirt out there, and they get caught by the ocean current experts in florida -- fought by the ocean current experts in florida to say it will take beach away from them. now that they re there, adding to them will not be as difficult. this will be something historical for the whole region. as long as we can get through this hurricane season, we are going to -- we have already started a foundation, so we do not need any other money.

[inaudible] >> i have spentt60 years of fishing in these waters. i have a big marlin over mike out to prove it. to prove it. we know what you're talking about. we saw those islands disappeared. whatever you can do to restore them, it is where we had to go before katrina, it is where we had to go before the oil spill. >> this is almost a no-brainer. you are helping with the oil spill, but you are helping four years from now. for me, that was one of the most encouraging things about the president's speech, is that the started focusing on "we have all been working on, but now is --

on, but now it is more of arkin- national concern. >> the national people were talking about that is what we need to do. i know there is a conversion being looked at from myrtle grove that is in the planning stages. our coastal plan is putting a berm behind the levees to protect the parish. then we come out and build the natural riches and islands that we had before with the 60 trees. it would lower the swans 15-18 feet per parish. -- swamps 15-18 feet per parish.

every time we have a heavy wind, it comes in here and takes the vegetation out. if we have this, this, this, and this, that's all water will not come in. we can do that with what we presently have. we do not need a bigger one. we are going to show green arrows coming out of there. the salt water will hit it and push it back up. they're gonna show that those grain areas actually come to hear -- those green areas actually come to heare. if we determine that we do not want saw water up here and we want to increase the diversion, that is the time to increase it, but let's spend the money keeping saltwater out. because you're never going to fight mother nature. making a diversion is a fight we are not going to win.

it will take just a strong wind to blow it back in. that is why our focus -- and i am on the governor's board. they're letting too many scientists into the plan. >> why is that? >> listen come in -- listen, i worked with that foundation years ago. i used to give them catering. they have turned into the most extreme -- they were against the berms. i want a written statement saying that. they have become extreme, and everything is bad for the environment. the diversion, depressed water. right now, i have to have

mitigation as if i was building an airport, which is absolutely ridiculous. >> from one standpoint, you have no maritime industry. how flexible is that? there has to be a compromise. there has to be a balance. i do not know why -- the local parish presidents are the ones with the boots on the ground to understand our area. the saltwater intrusion is not figured in when they talk about the berm. they just talk about what they do not like about it in a perfect world. >> it this island was not built within a year or two, those pelican's moving further in --

their nesting grounds are all but gone anyway. this would give us the protection we need to allow them to continue testing out there. >> you mentioned you might want to get down to see mr. kaufman. by but, it would probably be too risky -- by boat, it would probably be too risky. but if you want to go, we need to leave and we need to get a bigger boat or drive. >> i want to go out, but i do not want you to have a problem. [unintelligible]3 >> i am sure he is coming back

to new orleans tonight. i will check to see where he is going to be. >> we will track them down later. >> had the weather been better -- >> yeah. [unintelligible] >> look here. >> look there first. >> there we go. >> thank you. >> wonderful. >> thank you so much.

>> this weekend on book tv, a recount of the 1945 death penalty trial of william mcgee at the beginning of the civil rights movement. spenterwards, a man who's 45 days in a dark cell after being captured by taliban fighters. veteran wall street reporter has an inside account of a rupert murdoch's purchase of the "wall street journal." join us on a twister. more than 30,000 viewers already have -- join us on twitter.

more than 30,000 viewers already have. >> watch the confirmation hearings of the elena kagan starting on monday. to learn more about the supreme court, read our new book, providing a unique insight about the court. >> now, another look at the economic impact of the oil spill. >> my name is cheri pete. i have lived here my whole life. katrina could not keep me away. since i was 6 years old i have wanted to have this business.

we have been working since 2009 to rebuild and get back open. >> that was right here? >> that was right next door. i will show you what was here. [unintelligible] >> i noticed that you have a bunch of signed upon the side of your restaurant. can you explain those? >> i feel frustration. i have had many mornings of frustration. you wake up watching the news, you go to sleep watching the news, and you wake up and see the exact same things on the news, and no progress whatsoever.

we want to see some progress. it does not take a rocket scientist to figure out how to stop the well. we have lots of ideas. there are things that can work, things that are common sense. we have obama and the american flag surrounded by black, representing the oil. that is how we feel in our community. we are drowning in oil. everyone in a matter of hours of this oil spill was totally devastated because this was not a hurricane rowling in that we could prepare for. this is something that we do not know how to prepare for. we do not know what to do. we do not know how to recover from this. as far as how close it is to us,

we woke up and we could smell the oil at our door. i mean, it is right here. it is right in our front yard. where we live there is a levy following the mississippi river and a levy following the back bay. that back bay, you could almost see the dolphins 100 yards behind my house. it will be up in those waters. all we need is a hurricane to come through to push this oil even further than it already is and we may never be able to recover. we may not literally be in it, but it is taking away our home, our livelihood, our cash for this area. anybody who is from self louisiana or the post -- south louisiana or the coast, you

know, you cannot go anywhere in country and feel like you do here. we welcome everyone with open arms. we need to lift the ban on the oil. we need to be drilling. we are going to need that not too far down the road to survive. >> what do you think the federal government should do to help? >> let's say. where do we go from there? the federal government. first they came in after katrina, and we saw what happened there. we have so much red tape that people are still trying to figure out how to get road home

money. i never received a penny from road home. i never received anything from fema. when it comes to the government, i could chew heads all day long. they are not living it. i invite any one of them to come spend a week in our shoes. i have workers who are quitting because they cannot keep up right now because of the stress. there are people being hired on by bp. we are not getting paid. my husband has been working for them for four weeks. he has not gonna pitch again. our bills are piling up. if they want to see what it is like, let them come work for this kitchen. let us see what real life is about -- let them see what real life is about.

[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> coming up, president obama speaks about the financial regulations bill. we will gettanalysss of the bill from a bloomberg news reporter. >> before heading to canada for the g-8 summit, president obama took a moment to speak about the financial regulations bill. negotiators worked through the night to craft a compromise version of the measure. the vote was along party lines. the full house and senate could vote on the bill next week.

>> good morning, everybody. in a few moments, i will depart for canada to take part in a summit the g-8 and g-20 nations. this is the third g-20 summit we have held since i was sworn in as president. at our first meeting in london, with the world in the grips of the worst financial crisis of our time, we acted boldly and swiftly to bring our economy back from the brink. at our second meeting in pittsburgh, our recovery beginning to take cold, we agree -- take hold, we agreed to work to pursue a balanced pattern of growth and repair our financial systems. this weekend in toronto, i hope we can build on this progress by coordinating our efforts to bring economic growth and strengthen the global economy. we need to act in concert for a simple reason. this crisis proved, and events

continue to affirm, that our national economies aree inexplicably link. -- inextricably linked. just as economic turmoil in one place can quickly spread to another, safeguards in each of our nations can help protect all nations. i am gratified we have made great progress towards enacting these safeguards here at home. it was due to the incredibly hard work chairman dodd and chairman frank, and the strong leadership of chairwoman lincoln. there was also a great effort py the members of both parties who were up very late last night. we're poised to pass the toughest financial reform since those we created in the aftermath of the great depression. early this morning, the house and senate reached an agreement on a set of wall street's performance that represent 90% -- wall street reforms that represents 90% of what i proposed when i took up this fight. let me be clear -- our economic growth and prosperity depend on a strong, robust financial sector.

i will continue to do what i can to foster and support a dynamic private sector. we've all seen what happens when there is inadequate oversight and insufficient transparency on wall street. the reforms making their way through congress will hold wall street accountable. we need to prevent another financial crisis like the one we're still recovering from. we will put in place the toughest consumer financial protections in our history, while creating an independent agency to enforce them. through his agency, we will combine under one roof the consumer protection functions that are currently divided among half a dozen different agencies. there will now be one agency whose sole job will be to look out for you. credit-card companies will no longer be able to mislead you with pages and pages of fine print. you a longer be subject to all -- you will no longer be subject to all kinds of hidden fees and

penalties for the predatory practices of unscrupulous lenders. instead, we will make sure that credit card companies and mortgage companies played by the rules. you will be empowered with easy to understand forms so that you you will have a clear and concise information you need to make the decisions that are best for you and your family. wall street perform will strengthen our economy and a -- in of -- a number of ways. it will make our system more transparent and bring the kind of complex deals that helped trigger this crisis like trades in a $600 trillion derivatives market into the light of day. we will enact the volcker rule to make sure the banks protected by the safety net of the fdic tdo not engage in risky trades for their own profit. we will create resolution authority to help wind down firms whose collapse would threaten our entire financial system. no longer will we have companies that are "too big to fail." or the last 17 months,we have

pass an economic -- over the last 17 months, we have passed an economic recovery act, health insurance reform, education reform, and now we're on the brink of passing wall street reform. at the g-20 summit this weekend, i will work with other nations to coordinate our financial reform efforts and promote global economic growth, while ensuring that each nation can pursue a path that is sustainable for its own public finances. at the main forum for -- as the main forum for international economic cooperation, the g-20 is the right place to discuss those issues. over the last few days, i hope we can build on our past progress and strengthen the global economy for a long time to come. thank you very much, everybody >> can you get the bill through the senate? >> what is next, mr. president? >> president obama is in canada this weekend for the g-8 and the world leaders of eight of the largest industrialized nations have gathered for discussions on

global economic issues. >> here is stephen harper as he welcomed the participants. [inaudible] >> nice to see you again. thank you.

[inaudible] [applause] >> president obama is now in canada for the g-8 north dakota 20 summits. tomorrow, we'll have live coverage of the closing

conference beginning at noon. sunday, president obama will meet with the heads of the g-20 countries, including leaders from india and china. you can see live coverage of that on sunday, starting at 5:00 p.m. eastern, here on c-span. president obama is in canada this weekend for the g-8 and the g 20 summits. house and senate negotiators gave final approval to the bill this morning after staying in the entire night. it is the largest rewrite of a rule since the great depression. it now has to be voted on by the full house and senate, which we expect to happen next week. right now, we'll show you the last 20 minutes as the negotiators gave their final approval and then spoke with the press. >> chairman, i now intend to put to a roll-call vote the completed package which we have before us. i ask the court to call the role of house members. we will then have the senate members. i asked the court to call the roll of all house members who

are entitled to vote on this. >> i have to ask consent for that to occur. >> we ask unanimous consent for that to occur. the effort will be to get this bill on to the internet as each title is produced. we expect to vote in the house on tuesday. >> mr. chairman, when would we enter that -- to seeing those -- when would we anticipate seeing those amendments? this bill is quite technical. >> could i ask the staff -- as we produce them, some tomorrow -- i would certainly object to any staff member who came in here before noon tomorrow. [laughter] yes, today. [applause] >> senate staff will be at their desks at 8:30 this morning. [laughter] >> having slept there for the

past couple of hours. we'll get them as soon as we can. i ask that the clerk now call the roll on passage of the financial reform bill. all members of the house are entitled to vote on the final bill. >> mr. chairman? >> i. -- aye. >> aye. >> aye. >> aye. >> aye. >> aye. >> aye. >> aye. >> aye. >> aye. >> aye.

>> aye. >> aye. >> aye. >> aye. >> aye. >> the clerk bogota the republicans. -- will go to the republicans.

>> 20 ayes, 11 nays. >> the house sends you its approval. >> let me congratulate you on a terrific job. we will now vote on the senate side. those in favor aye, those opposed nay. the ayes have it. [laughter] i will ask the clerk to call the roll.

>> mr. chairman? >> aye. >> aye. >> aye, by proxy. >> aye. >> aye, by proxy. >> aye, by proxy. >> mr. shelby? >> no. >> mr. crapo. >> no. >> mr. corker. >> no. >> mr. chambliss. >> no. >> the clerk will report. >> 7 aye, 5 nay. the bill is passed. >> i thank my colleagues. [applause] >> with the votes of the house and senate conferees in favor of passage of the bill, i declare the bill passed and the

conference committee is now adjourned. [applause]

[inaudible] >> nice to meet you. take care. [inaudible]

>> congratulations. [inaudible] >> congratulations.

[inaudible]

[inaudible] [inaudible] >> we recognize the remendous efforts of staff. we have worked together, butit

has been nothing quite like this. as is as good as it gets in terms of a legislative effort. we have work to do. this makes a huge difference. no one thought we could get this done. it is a tough environment to operate in. to establish a consumer protection bureau for the first time in the history of our country, to stop the too big to fail, to ensure that we do not end up with another near financial collapse. we will provide an early- warning system. it is another of the great pillars of this bill. >> how will this work? >> we believe it was needed for a long time. it was exciting to bring it to

where we could get this done. it is a terrible way to have to do this. we have people like barney frank leading the house effort. we have great people like harry reid and nancy pelosi making a huge difference for us, giving us the space an opportunity to -- in the opportunity to do this. this has been badly needed for a long time. we hope to protect our country. we hope to create jobs. we hope this will bring optimism and opportunity to our financial systems. it is a great moment. i'm proud to have been here. >> i agree with the senator. it is an extraordinary experience, obviously. we hate to have the kind of pain and crisis to have to get it done. we try our best and work together.

we tried to stave off some of the crisis. we hope that the legislature will be ready. if you intend to focus, as you do, understandably, on the controversy, by definition, controversy over the last little pieces, people will forget how far we have come. the negotiation for the consumer protection agency, the securitization rest requirement, the volcker rule, the widespread reform of derivatives -- those were all unachievable years ago. obviously, it is not everything we would like. in every area where we have touched, we have made significant advances. i would also say that it is a tribute to the way american democracy can work. there was a difference in this bill. last year, when we were debating

in the house, health care was getting all the attention. it was not as good of a bill as i would have liked to bring out. we were not getting public attention. people were not -- people with an economic interest were not moving forward. this was a much tougher job than the 60-vote majority. it will be more difficult. with health care, the american public began to focus on this. it has made an enormous difference. this is better than it would have been coming in significant -- would have been, in significant ways, because the american public focused on it. i hope we will give people a sense -- we worry about big money. it is reassuring to know that public opinion gets engaged and can help win. we just need to make sure we have more of that happening. >> i agree. our staff are extraordinary.

putting a lot of time in a stressful condition, for far less money than they could have made elsewhere. >> do you think you'll have a majority? >> i do not know that. we'll see what happens in the next few days. i have stayed in touch with the the republicans in the senate who supported the bill coming out of the senate. i've had daily communication with them as to inform them how things were proceeding. i have asked about their thoughts. of it -- i talked to chairman friend about these things and he was very aware of it. they were very interested in the proceedings. there were no demands. they were interested in things. it was a very good relationship. i cannot tell you today. i have to talk to them over the

coming days. i hope we will see a bill -- a stronger bill than the one we came out of the senate with, with all of the things they're interested in and a bit more, because we were able to prove -- improve some ideas. some of them are controversial ideas. i thank the house members and chairman frank for understanding that. we're in good shape. obviously, i'll reserve judgment until i can talk to my colleagues. what else? >> on the volcker rule [unintelligible] >> of the chairman has made the point -- maybe it was not made often enough -- this bill is not done yet. the president may be on his way now to toronto. he is on his way to the g-20. why we have not completed it, the harmonization of our rules -- it will be awfully important. united states, having completed

this work, we open the next week, can offer some leadership to the world in what needs to be done to harmonize the efforts we have talked about this evening and recently. i think it will strengthen the hand of our president going to toronto to make that case. we believe with a passion in this bill. we hope will occur next week. we can make the case where follow -- fellow parliamentarians, union leaders, and others. they could embrace the principles at least of what we have done. adding it levant's the stability but i think it will advance the stability and predictability, as well as a kind of wealth creation and job creation that we desperately need. >> first of all, there articles today in the newspaper -- there were articles in the paper saying we would be debating. europeans seek blil -- bailouts. they want to tax their institutions to pay for their recovery.

this is what we did today. the british -- the conservative, british government has just beat up to the punch -- be as by the punch -- the us to the punch by -- beat us to the punch by a few days like setting up of consumer protection agency and dissolving their financial services agency. we need to not separate out consumer, some said, but they did exactly that. there's a great deal of -- we put in the hands of the president of very powerful set -- a very powerful of rules. we're trying to get other countries not to -- to stimulate and help us defeat unemployment. i think we're making it very clear that the president is a world leader. you'll see continued conversions.

>> thank you. >> senator, are you confident of the derivative language that is central? -- centrist to the new dems? some of other -- some other folks that concerns. are you going to lose any of them on the floor? >> i am not. i believe there will be a majority. there were some people who voted -- a handful who voted against it from the left. i sympathize with a lot of my democratic colleagues. they're very thoughtful people. i understand their concerns. the amendment as adopted moves in that direction. one of the concerns i had was the amendment of senator lincoln -- what we thought was an inappropriate application of %+duciary response ability. -- responsibility. we heard complaints. we have modified that. with a very strong code of conduct. we have some of the things. i think some will vote no. i'm pretty confident that we have a majority here of house members. unfortunately, it appears in the house that the republican party is going to repeat its onttern of simply voting no an

everything and being status quo. we'll have enough democratic votes. >> is july 4 still the goal? >> it is. >> thank you very much. >> thank you. have a good breakfast. >> we have won the medal. take care. >> we win. >> guess i'm paying for breakfast. [inaudible] >> starting monday, watch the confirmation hearings for supreme court nominee an elena kagan live on c-span.

can see id air again on c-span2. -- you can see it air again on c-span2. also, looked at our new book which provides new insight about the court. it is available in hardcover and as an e-book. >> c-span -- for public affairs content is available on television, radio, and on line. you can connect with us on twitter, facebook, and youtube. signup for our schedule alert e- mails act c-span.org -- at c- span.org. we talked with the bloomberg news reporter to find out more about this bill. this is about 40 minutes. host: what happened at 5:40 this morning? guest: well, i did not stay with

it all to the end. i have many colleagues in up,ington who did stay unfortunately. but the congress conference senate-house committee, they out an hammered agreement on the financial bill, which has been a while, but we are it, i t the end of now. according to this article in a "politico," this is the broadest rewrite of the nation's financial regulation since the great depression. do you agree with that? guest: i do, i think everybody with this. talked to a lot of analysts and because we really, we had the big reform after the which kt theion, healthyl system pretty or 50 years, and then we deregulating and the

1980's. since then, it has really been irection. er this is 30 years later, the to er-regulate -- %%re-regulate. host: what is the volcker rule finer -- finale outcome? guest: named after paul volcker, be the fed chairman 1970's and 1980's, who beat inflation that was the big problem in those years, that several goals. one of them was to scale down a actities ofg banks. of the other one was to sort running andom funds andin hedge equity firms, which are also riskier activities.

at the end, there was a lot of that was abecause contentious rule. so, a lot of this, the strength been weakened. it is still there. withestrictions on trading their own money that the banks , andn theast remain the regulators won't have as limitst those might be. written into law, which is the good part. negative part that was sort thaa they can compromise the bit, was how they can run and invest in hedge fds. it was aimed to not let them do activity. now they can continue to in privatege funds equity firms, and they can to 3% of their , which is small, not too

much, but it really opens up the risk that when, during the crisis, for example, bear stearns hedge fund, when they aid. o their goldman sachs did the same. so, that danger, the reputation the big banks need rescue their hedge funds, not really fixed so compromise. e host: so, the volcker rule, was this contentious and opposed by the big banks? the guest: yes, it was, because bgest bank -- j.p. morgan, sachs, bank of america, them have huge operations of hedge funds. j.p. morgan is actually -- it operates the largest hedge fund somee world, according to rankings. so, they would really be forced

their hed fund operations, separate them from businesses, sell them off. also have major investments in those funds and the private equity, especially equity. vate they invest heavily, along with their clients. they still have to scale those but it not going to be as they steer it was going to be. host: 202 is the area code if talk about theto regulations deal that was reached at 540 -- 5:40 a.m. by the conference committee of the house and senate. the democrats voted for it at all republicans voted against it. yalman another contentious issue was the issue of derivatives. senator blanche lincoln had a

big role. what happened? guest: senator lincoln, who year, atlection this really -- this on for about going two years now starting at the house and the senate. she proposed that the derivatives operations of the banks would be completely off -- it would be in the not havet would it, becausedo with it insured banking institutions. -- deposit insured banking and petitions. would mean banks wouldave separate companies that would capitalize increasey, which would their costs and lower their profit. the last-minute compromise -- much pusheds some and thebanks -- not sotration was about it, either, so of or siding with the on this. ttle bit

final compromise is the derivatives activities will be put into a entity that the banks capitalize but it is not everything. only the riskiest of the derivatives. credit default swaps, and the like. and especially credit defaults what not traded in exchaes. the derivaves build that is hopefully -- it is not at all finalize -- is to force a lot of be traded ono cleared through clearing houses. what that does is really reduce the risk because everything is set up margins, to put ups you have money. theill goes down, then that is taken away. so, the risk would be curtailed any way. senator lincoln's proposal further, and now does a

intended athat she beginning, but some of it she agreed at the last minute that that would be fine and they have to separate all the business into separate entities. go to calls,we issue of aue was the financial protection bureau. how did that come out? upser: that one had several and downs while this debate was on in the house and senate. it came out song and it weakened and then it got strong again. i think the final outcome is consumers. be a consumer protection bureau. housed within the fed prettywill be independent. the systemic council that is made up of all banking including the fed others, willand have veto power over some of its decisions. if it threatens the financial

stability -- which is not an it is a high board to set. -- high bar to said. independentill be it -- another compromise was that it will not regulate the banks directly. that the bank regulators will be looking at their consumer products. but all of those -- the consumer bureau is coming to life. that one isbehind that the subprime products, the heart of the crisis, will not be longer allow the because a regulator will look these consumers are being products andsuch stop banks from doingg so.

so, it sounds like a good thing. onaran from is our guest. is the deal were the financial regulations bill. frome first call comes florida, jackie. caller: first of all, i enjoy show. it is really sad -- yes. first of all -- host: we are listening. go ahead, turn down the volume your comment. th caller: i, is that it isad. -- my comment is it is sad. it has to be more art government and less people. you have to regulate -- it has government and less people. regulate the banks. the deregulation of the oil company. you have to regulate them. the mortgages and on. thing that is going you have people going in,nd

know they cannot afford homes them and know the banks affordw they could not around it ahe way of crooks, the american dream. host: yalman onaran, two things. re-regulation, and as jackie out, does this affect mortgages and the way mortgages handled at all? guest: yes, it does. the consumer protection agency about wille talking look at how banks sell any consumers, and mortgages are financial consumer products. . that was some of the comments that i may -- read from senator judd. he said, it is great that we

have reform, but it does not tackle the main issue. those are the government- sponsored mortgage agencies. it is true that the ministers and has not really tackle the those. they are aware of that. they have been saying that after the financial regulatory reform, they will really look at what to do with those agencies which are pretty much owned and operated by the government right now. we have sort of bailed them out. what will we do with them going for? will they still buy the mortgages that are out there? they own about $5 trillion of mortgages, which is a big majority of them. then they will look at the connection to the government and whether they continue to be private-public. that has not been tackled. it is not part of the bill. has not been discussed really.

we can look forward to that one coming up next. randy. marietta, georgia. republican line. caller: good mornin i'm just curious about the bill and how that will play out next year when the mere o floats against the other currencies. caller: mr. yalman onaran. randy, you want to try again? caller: yes. from what i understand fromc nbc started floating against other currencies late next year. how that - guest: you mean the amero? the new currency for the north

american union. caller: we're going to move on to long island, new york. caller: i would like to ask, these banks. they are making the rules for these banks. i want to ask you, what's the rule for the consumeer? host: when you say rules you mean the protections, george? caller: yeah. host: mr. yalman onaran? guest: that's the consumer protection agency we talked about and it's supposed to look how the banks target the consumers. so when you get a credit card and there are hidden fees in your credit card and you're not aware of them, the consumer protection agency is supposed to see that and try to protect the consumer and tell the banks, no you can't charge the fees unles onoka you tell the consumer

clearly what they're gting into. similarly, with mortgages if you're getting no down payment mortgage and your interest rate jacked up after two years and you're not aware, the consumer protection agency is going to prevent the banks from selling products that the consumers don't understand. also, the financial regulation before the packet was completed, there were several pieces of smaller legislation that passed house and the senate and were signed into law by the president that have really put down harder rules to - in credit cards and other stifts that the banks do to reach the consumer so there have been rules in this. host: including a limit on debit card fees, correct? guest: that's part of the current packet making it's way through, yes. there's going tbe limits on the cards that we use.

the debit cards we use to make purchases. host: next call for yalman onaran of bloomberg comes from florida. bob on the republican line. what's the name of your city? caller: home of the barefoot mailman. host: go on ahead. caller: i saw probably back in the late 70's or early '80s and they changed fannie mae and it used to be a conservative loaning process of three per tenth and ten then 10% for the next 10,000 and 20% for the next 10,000. when they departed from that and they rsed at least on the government corporations for that are owned by the federal government and they upped it from maybe, a maximum of 70

thousand on up to 125,000 and then it just kept getting worse and then what we had, we had, we allowed some of the savings and loans to invest more than 3 percent of their money into real estate and we had the savings and loan crisis. i think if we pursue a safe conservative policy in the future for home purchases, that would be in a lot better shape and i think the building industry is a large industry throughout the united states and i think that's where the country is taking their hit on the chin and i think we need to put the people back to work and the best way to do that, i believe, is to rehas en all of these old homes that have led paint on them, through some form of government assistance and get the led out of the pipes and the lead out of the paint. host: we have a lot on the table. mr. yalman onaran, anything you

want to respond to? guest: um... i mean i don't hear a question, but there is discussion about what to do with fannie mae and freddie mac as discussed earlier and there's debate whether there should be a second stimulus bill and that hasn't gone too far. depends on what the economy does in the next few months. the practice in euro might effect the u.s. economy as well. if that happens and then i'm sure congress will start debating more closely whether or not we should have a second stimulus bill and if that, maybe some of the things the caller might mentioned might be in there who knows. >> any new taxes placed on banks or hedge funds in the compromise deal? >> i'm not so sure about that one. i think there was debate until the last minute but i didn't wait until everything was

finished and when i looked at thing this morning quickly, i don't remember that part exactly but there was debate on a bank tax which the u.k. just recently passed and france and germany said they supported and u.s. was also saying they supported but didn't make it into this one. i didn't see it this morning and i'm not so sure. host: how will the fm stocks react when the mark et opens? guest: it's very hard to know. there are some pretty harsh rules in here. nothing unexpected. new most of the rules that against that would curtail activities of the banks. they've been in discussions for months so that they were probably priced in. there have been some compromised

that soften some of the restrictions. but they, we kind of markets knew those were coming as well. overall, i don't see surprises in what happened last night. it seem as long the lines of what market prices were expected but then the mark et has a brain of it's own and you never know whether t'll react negatively or positively or not do much. >> ext call from last crew sis new mexico. >> i just wanted to as i don't know if this pertain to credit cards or debit cards, while this in any way low tear interest rate on those kind of cards when you use them? or what do you think? host: mr. yalman onaran? guest: to low tear interest rate? i'm not so sure. the interest rate - excuse me.

the interest rate is dependent on the interest rates in the untry part i which is very low now, but there still is termed by different ways. does the legislation restrict the rate? >> it makes sure that they're not - hmm... the consumer protection agency i think will look at those rates and make sure that they're not unnecessarily high. but is there something specific that wl try to lower them? i don't think so. i think they're still set by if banks and you know, if interest rates go up in the next couple of years as economy improves, if the fed starts to raise interest rates, then i'm sure, credit card rates will go up and know one will try to prevent it but i think it's whether or not those interest rates, the fees charged

by the banks are fair and reflect economic realities, then they are costs and they can't do just anything they want that's the only thing i know. host: mr. yalman onaran, did you find that new york legislators were pushing for different things since a lot of financial companies are located up in new york? guest: not that much. the biggest defender of some financial companies that emerged at the last minute was senator scott brown, who is the new messenger or massachusetts senator. he fought really hard for the state's street and a couple of custodial banks based in boston and that was related to the volcker rule. when he wasoi that, i heard that some new york senators,

senator gillbran was looking at the issue and sort of involved in the discussion but she wasn't really such a strong voice in the debate. so i haven't really, not that much. host: what a custodian bank? guess guess great question. i' asked that myself after couple of times. but a kus doed ya'll bank is not the type of banking we understand typically. the commercial banks that lend out loans or not a message bank that under writes security. custodian banks keep the securities assets of mutual fundsnd other institutional investors like pension funds that deposit that managg our savings and that you know, they

do the back office f those funds, so they really, it's not their own depos or their own assets they hold, but the pension funds and other institutional investors. that's what they do. host: doug. republican, vginia. please go ahead. caller: guess my question was answered about fanny and freddy. why did we let them kick the can down the road until after the election? and when are we finding out congress involvement in the housing proble when we drill down and figure out what they did or didn't do to hurt or help the problem? host: mr. yalman onaran? guest: again, why is it being kicked down the road? i'm not so sure. again, there have been many issues to tackle and administration has chosen not to tackle tha one. i think the biggest reason for

that is tte mortgage or housing market which has already gone down. prices have gone down is still very sensitive if you really try to dismantle fanny and freddy right now or do something differently it could spook the mortgage market more and the practice could go down more and it could really, bring the receion or rec resession back and that's the fear on capitol hill so they have sort of been waiting for the economy to recover is my suspicion. and the second part of your question, i'm sorry, i forgot. host: housing markets kicking the can down the road is that caller said. think that's where he was going. mr. yalman onaran, he is a senior write wear bloomberg news, born in istanbul and got a

masters degree at colombia. he's been with bloomberg since about 1998, prior to that worked for theap. we have this tweet that just came in. a little off the topic but i'd love to get your response to it. too many americans think the dollar should be strg verses other currencies because, well, strong sounds good. guest: [laughs] i didt realize that too many americans wanted the dollar to be strong. but i mean past administrations have slow kateed a strong dollar, and i don't always understand the debate on weak verses strong dollar and high we should have one or the other. i haven't followed it that closely but weaker dollar would help boost exports and stronger

dollar, probably helps us pay our debt easier. i think those are the true debates and i'm not sure. it's always something positive and negative for on both sides. hard to figure which one is bett. host: another tweet if the big banks would buy back all the toxic assets it sold to freddie and fanny ty could then dismantle them. anyresponse? guest: well, i mean, i don't think the big banks really sold all the toxic assets to fanny and freddy. they bought mortgages from all the banks in the country, including the thousands and thousands. we have 8,000 community banks as well as small mortgage lenders that are not even banks, not even regulated u like banks so it's not as simple as the big

bank that's sold them toxic assets and most of the toxic mortgages and those that have gone bad in the last five years, is really started going bah bad after 2005 were not done by the big banks but by smaller instutions. the big banks help package them into securities. mart fwaj backed securities, we call them but still it was a widespread effort. not just a handful of banks. host: pennsylvania, go ahead? caller: a couple of callsing an a woman said we need more government and regulation. it's my thought that, the government started telling these banks that they were going to start lending money to the people that couldn't afford their rtgage. what role did the clinton administration and bush followed it up also, but what role did

they play in this whole mess that we're in now? i mean u, wasn't government involvement the reason why they loaned money to these people. how much has that played the down fall we've experienced? guest: it did play an important role. you're right. democrat and republican administrations did encourage banks to lend to groups of people who perhaps couldn't afford it that way. and congress pushed for it as well. the were several pieces of legislation passed and again, both sides of the aisle were encouraging the mortgage lending. home ownership to expand to more of america. it looks good. when you know, in theory that the wonrful thing. more americans should own homes

but as you said, it's riskier when peopleho incomes don't allow them to do that, if you lent to them, eventually it's going bad. for some years when the economy wasn't doing well and asset prices were rising. officially housing prices were sing that was okay because even if you have income that doesn't make you help you with the payments then the rising housing price helps you refinance and you stay current with your payments but when we hit a plethora and prices started decline and the economy stopped growing, then everything came tumbling down. yes, the dpovpts and congress, that is they encouraged wider hope ownership. without realizing and paying atntion to what that meant, how rky loan where is being made. they did play a role to

host: next call from mississippi for yalman onaran. john, hi. caller: how you doing? i have a comment. you know, this country has really been self destructing for a while. basilly for money. for the war lords. my thing is, what does the luminac luminachehave planed? host: republican line. carol? caller: good morning. how you guys doing this morning? yes, sir. i wondered i was watching a special that had this last year on,c nbc with house of cards that explained how every thing happened and it showed that they would take these mortgages and rate them so they could sell them over seafoods so seems like most of the bad debt where is sold overseas.

we didn't hold themmed because new they were not good to begin with. the way it looked as they sold them fast as they could make them. they wouldn't keep them here and maybe that's why some of the overs is having some financial problems they're having now? guest: there's partial truth to that. a lot of the mortgage debt was packaged into mortgage backed securities and that was sold everywhere. not just overseas but here. in investors and pension funds bought them too. that's our 401k and our retirement funds. so yes, it did contribute to the recession. not the current european crisis but when we tumbled two years ago and the u.s. economy and the financial system came to the

brink of collapse. europe and asia were effected because of the banks and government and local governments holding some of the debt. the losses that are bourne by u.s. financial institutions and non-u.s. financial institutions, since the carry sis starts, are roughly the same. the total is.7 trillion dollars. these are on mortgage related securities that we're talking about and it's about half of it in the u.s. and the other half is the rest of the world. we did ship some of the toxic overseas but had enough to hurt us as well here. the current europe crisis is a fferent issue. it's based on their similar things. you know the spanish real estate market was over valued.

the uk market was over valued and those came down and gece borrowed too much and spent money without really paying attention to it's finances, so in some ways it's similar but it's really not because of the u.s. and what we did in our housing market. now they're sort of in the second phase which is their own problem. host: just to build off the last two callers. what internattonal provisions are included in the financial regulations deal struck at 5:40 am this morning? guest: what do you mean why i want independent? host: anything you can speak to that deals with international financial? guest: not that i can think of. well, i mean there's sort of discussion of resolution and sort of howo wind down systemically important banks and

institutions and that, those are all international active stuktss so that addresses some of the issues. but tre is, there are separate efforts to set up regulations for all banks globally that would be international and you know there's a committee on banks supervision that really brings together all the regulators of european asian and u.s. together and they're discussing rules but that hasn't conclude yet. that's another addition to the rus we're trying pass here. and then there's the g20 meeting this weekend in toronto, and they have several other bank related financial related regulation topics such as compensation limits or, again, the resolution authority that

some sort of international resolution authority that would tackle if a international bank went under such as when leyman bros. collapsed it had so many subsidiaries in so many countries, no one knew how to handle it. theankruptcy court here didn't have jurisdiction in london or tokyo. those have not been tackled. ht: next call from deer park, washington. independent line. joshua? caller: good morning. i was goingo take a coletely different tact. i find how very nervous your guess got with international provision. we're not dealing with fractional reserve banking. some say the credit default swaps were one kwa drquadrillio.

we see a collapse that might be created on purpose. i know nine people thatave not paid a dollar. not paying property tax or mortgages and no one is even coming after them. our system is going to collapse. i want to ask you a personal question. can i ask you personal question. host: josh , go ahead. caller: does your guest have and advanced college degree and in what? host: mr. yalman onaran? guest: yes i have two masters. one in international affairs. >> ny response to his points regarding mortgages and international finance that he discussed earlier? guest: he pointed a good thing i hadn't thought about which is the derivatives regulation that

in theinancial reform back set very international. all the derivatives and the mark set very international. it's about 600 trillion dollars of derivatives out standing an according to the bank of international settlement and the rules that u.s. is about to finalize and pass, do really address the derivatives issue and force them to exchange and clearing houses and forcing more capital and collateral to put up when trading them and these, the derivatives rules that we're passing are aually going to be serving as an example to the rest of the world. europeans, asian countries. they're all looking at the same type of ideas and they're probably going to follow in our footsteps to regulate derivatives in a similar way in away this doe have

international repercussions. host: dan, you're the last caller. go ahead. caller: yes, sir. i wanted to make a couple of quick comments. your guest had mentioned that government or congress had a lot to do with encouraging loans that were, you know, low income and i wanted to flush out me detail on that. the - if you go look at the laws passed the last couple of details. specifically the code of regulations. title 12 you find congress passed lo laws that made 50% of their loans low income. banks tried to comply with that. in the end of202008 when we had a tremendous failure that occured the fall of that year, we had 54 million mortgages throughout the u.s. and at that

time, 26 million of those, had been made to low income families and 11 million of the 26 million were held by fannie mae and freddie mac. now, those banks tried to comply with those 50% requirements in the title 12 code of regulations and the reason they did is congress put in there tremendous requirements on the banks. they currency had the authority to look at the activities to of the bank and to be able to refuse them things like expansion and putting new branchs in place. host: dan, you seem knowledgeable about this. what's your profession. ller: i'm an engineer but the banks tried to come my with those. can i make one other comment? the other thing i want you to do is put yourself in the posion of the banks and say if you had all these assets sitting on your books that were poor, what would

you do about? it they couldn't get rid of them so their way was to then combine them and make other assets with some good los so they ended up putting the proverbial bad apple in the bunch and tried to sell the whole bunch. host: mr. yalman onaran? guest: i mean he points out some of the probls that - it's correct. that's we said earlier, that congress did encourage lend together low income families. but of course, it doesn't have to be this way. you can lend to low income families as long you stick to proper banking standards which is you look at how much they make. you look at what the value of the house they're trying buy and see if their income can help

them and help them make the payments. if you stick toood lending standards. it doesn't have to blow off this way. there's always 3%. 2%. defaults, people with pay. although they thought they could. they lose jobs or their income goes down. but they were really the banking system and not just the banking system but all the mortgage lender that were not even bank the shadow banking system that we call it. they really stopped sticking the standards that had been around for decades for. hundreds of years off good banking and that's why this all happened. congress did play a role by pushing them to make more loans but still, it

[captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute] quite stars and stripes reporter talks about general david petraeus who has been put in command of u.s. troops in afghanistan. a recent poll questioned citizens from 22 nations about their attitude toward president obama. we will talk to richard wike. it is live beginning at 7:00 a.m. eastern time on c-span. tonight, harry reid and it mcconnell talk of unemployment benefits. and house oversight committee meeting on a mortgage foreclosures. president obama talks on the regulation bills. >> let me say to the american people but this is a change in

personnel and not a change in policy. he fully participated in our review last fall. he both supported and helped design the strategy that we have in place. >> learn more about the president's choice to head u.s. forces in afghanistan. in general petraeus has been on c-span more than 40 times. what his appearances online anytime online at the video library. it is washington your way. on thursday, an effort to extend the eligibility of unemployment and if it failed in the senate. here is some of the discussion on the issue before and after the vote. from mid mcconnell and majority leader harry reid. this is 15 minutes. president, i have indicated to our friends on the other side of the aisle i would be propounding a consent agreement. let me just make a few brief observations, and then i will do

precisely that. the majority wants to make this debate about republicans opposing something. let me just be perfectly clear. the only thing republicans have opposed in this debate are job-killing taxes and adding to the national debt. we have offered ways of paying for these programs and we have been eager to approve them. what we're not willing to do is to use worthwhile programs as an excuse to burden our children and our grandchildren with an even bigger national debt than we have already got, so the biggest reason the cloture vote we just had failed is because democrats simply refuse to pass a bill that doesn't add to the debt. that's the principle that we're really fighting for in this debate, and let me suggest that i can prove it. in a moment, i'll offer a one-month extension of the expired unemployment insurance

benefits cobra subsidy, flood insurance program, small business lending program and the 2009 poverty guidelines. this extension would be fully paid for using the very same stimulus funds that our friends on the other side just voted for almost unanimously. to redirect for these purposes, let me repeat that. we would pay for the extension with a democratic-approved stimulus offset. if the democrats object to extending these programs using their own stimulus offset to pay for them, then they will be saying loud and clear that their commitment to deficit spending trumps their desire to help the unemployed. so let's be clear about the principle that's really at stake here. are our friends on the other side willing to extend these programs without adding to the debt? that's the real question in this debate. so, mr. president, in that regard, i would ask consent that the senate proceed to immediate

consideration of h.r. 4853, that all after the enacting clause be stricken in the mcconnell amendment -- and the mcconnell amendment at the desk be agreed to, the bill as amended be read a third time as passed, that the motion be laid upon the table. mr. durbin: madam president, reserving the right to object. madam president, for eight weeks, eight weeks, senator baucus and senator reid have negotiated with the republicans in an attempt to pass this important jobs bill. they have been asked to make the package smaller, which they did. they have been asked to pay for portions of the package, which they did, and still republicans continue to filibuster and stop this bill. what the senator from kentucky wants to do would be virtually unprecedented, that we would pay for the emergency spending for unemployment compensation by removing money from our jobs program, the stimulus program. so he is going to kill jobs on one side to pay for the unemployed on the other side. it makes no sense economically,

and it is certainly not within the tradition of the senate, and i object. mr. mcconnell: madam president? the presiding officer: the objection is heard. the senator from from -- the republican leader. mr. mcconnell: madam president, i would only briefly offer that the offset i just offered was one the majority just voted for. obviously, they didn't find it offensive in the context of the measure that was defeated. we'll continue to work on this in the hopes that we can pass this worthwhile measure without the presiding officer: the majority leader. mr. reid: i'd ask consent the call of the quorum be terminated. the presiding officer: without objection. mr. reid: mr. president, today there is about a million people in america who terribly disappointed with what took place here yesterday. a million people. that's a million in one category. there are hundreds and hundreds of thousands of others who are disappointed because of different things done to them yesterday as a result of the publicans not supporting legislation that was fully paid for. e statements made by republicans after this bill was rejected by them are simply

without any fact. there wer efforts made to work with republicans. we cut the size of the bill. we paid even for things we'd never paid for before. and we decided to do that in an effort t get help for millions of americans. one of the things we paid for was something called fmap, which is money that we would direct to the states that they could use for police, fire, teachers, nurses, stop layoffs from taking place there. that was rejected. there are numerous editorials around the country rejecting what the republicans did yesterday, and there are headlines virtually in every newspaper in america. l.a. times: senate g.o.p. blocks extension. business week: republicans

thwart bill with unemployment aid buyout. boston globe: filibuster halts bill-boosting jobless benefits, aid to states. mcclatchy newspaper: g.o.p. blocks jobless extension. "usa today" senate bill again blocks job extension and tax breaks. those tax breaks were for middle-class americans. seattle times: republicans continue blocking a federal aid bill. the republicans in the senate have made the decision to do everything they can to turn the country upside down to, do everything they can to stop any economic recovery because they think it may help barack obama. it may help some of their people trying to run for senate seats around the country. so they fure as bad as they can make the economy, the better

off they will be. that's a pretty difficult view for people who are united states senators. the presiding officer is a senator from the state of oregon, and that is your prime responbility, is to take care of their state. but also as a united states senator have toe concerned with what goes on in the other 49 states. that's our job, our role. that's the way we were cotitutionally designated. the bill they rejected yesterday creates jobs. as the headlines say, closes corporate loopholes. the bill yesterday that was rejected by the republicans would stop jobs from being outsourced, from american companies getting tax breaks by creating jobs overseas. those jobs should be created here. that was rejected by the republicans. the bill that was before the

senate was a bill that would help small businesses grow and allow them to hire once again, to be the engine that runs our country. big businesses should not be --rewarded for shipping jobs overseas when there are so many here at home desperate for a paycheck. i've read a number of these stories, mr. president. they really are heartbreaking. i read the nevada clips today, a stement from one man there, in effect saying what is going on back there? this is not a partisan game. i need money to take care of my family. i need my unemployment check. i tried to find work. i can't find work. but that had no bearing on the republicans yesterday because they, as we learned in the health care debate, want everything that obama does to be his waterloo.

everything in this bill was paid for with the exception of unemployment compensation, which is, which has always been a bipartisan recognition there is an emergency or we wouldn't be asking for unemployment benefits. the republicans were even unwilling, mr. president, to allow us to bring the bill up for debate. they wanted to stop the debate, further discussion of this bill. we could not invoke cloture to allow the debate to go forward. every republican voted against it. i was really surprised by statements of some coming to the floor afterwards and saying i was in favor of the unemployment benefits. let's be really clear about all the good things a "yes" vote enables our country to do with this legislation. it would have allowed the senate

to pass this. it could have gone to the president for signature. a "no" vote stopped us from doing things to help regular guys on the street, people who are desperate for help. think of this: an extension of a tax deduction for tuition. there are young men and women all over america today getting excited about goi to school or going back to school. because of what was done by the republicans yesterday, there will be young men and women unable to go to school. they're gng to have to stay out until the economy gets better while their dad gets a job or mom gets a job, because the tuition taxeduction is not going to be around. what a disappointed young group of men and women we're going to

have. and as sad as it is, mr. president, some of those kids will never go to college because of this. this legislation has allowed tax benefits for working men and women in this country, for deduction for property taxes. didn't do it yesterday. it's not available now. teachers around america would have been able to deduct with their income tax -- not much -- $250 a year to get a tax credit for the pencils and paper they buy every year. as you know, having been around teachers, as we all are,hey spend lots of their own money for supplies for the kids. yesterday the republicans took that small $250-a-year deduction away from these teachers, all teachers.

build america bonds, those moneys are shrinking. there aren't as many people making application for those build america bond programs. this has been such a stimulus for our country since we passed that in the economic recovery act. and we're running out of money there. the bill would have provided provided, $4 billion, all paid for. that was rejected by the republicans. they said, no. that $4 billion would have multiplied into many more dollars because if you have a contract worth $2 million to $3 million, people can go to work, they can buy groceries and shoes and stimulates the economy. but the republicans said no to that. state and local governments are begging for money. infrastructure is down. we need to do -- water, sewer projects, street projects.

but the republicans said no. the legislation was rejected yesterday, had anxtension of small business administration lending provision that's would provide low-cost loans to small business. republicans yesterday unanimous said no. the bill provided $2.billion for state wage assistance programs. what these programs are, mr. president, is -- started in the clinton administration. there was always talk by the republicans, and by everybody, not just the republicans, that should we do more than provide welfare to people? shouldn't we provide a way they can go to work? that's what this money is about. those programs are going to be terminated. programs tt have worked so well to have people go from welfare to work. yesterday the republicans said no unanimously.

let them stay on welfare. they don't need to learn how to work. they don't need to transfer to a job. this legislation was rejected yestday, provided yesterday provided tax credits for research and development. a lot of companies, especially small companies can't do research and development they need to do unless they get a tax incentive to do it well. it won't be done. this bill provided $5 billion -- all i've talked about paid for, $5 billion in new mart tax credits. what this meant is that investments could be made in economically distressed areas. they exist in oregon, they exist in nevada. they're going to continue to exist without any improvement because of the rejection by the republicans yesterday. everything i've talked about creates jobs.

and t have the republicans come to the floor and say we reject it because of the cost. it was rejected because they do not believe that middle-class america deserves a break. that allhe break should go to the fat cats. right now as a result of the republicans rejecting this legislation, someone who's working for minimum wage will continue o pay more of their taxes percentagewise than warren buffett. or one of the multibillionaires on wall street. they will pay more percentage of their income than one of these very, very rich people. in this legislation we had a provision to extend the first-time home buyers tax credit so that people who already qualified can buy a home.

rejected. they even rejected a provision we had in this legislation so that someone that is called away to fight in afganistan or iraq, we had a provision in this to allow them to make up the difference of what the military pay is and the pay on their job so they won't lose their job as they've done and put tremendous burden on the spouses left at home. so yesterday one thing my friends on the other side of the aisle should be very proud of is they protected corporate interest. they did that big time. they're betting on our country to fail, mr. president. that's a sad commentary.

we're going to continue, the bill's on the floor now is to create jobs. small business jobs creation. we worked hard to get that done with senator landrieu, senator baucus, small busines and finance. we'll have a vote on monday. again, it's being blocked by the republicans. blocking from us even going to it. so we'll need 60 votes monday to allow us to debate whether or not this country needs small businesses to create jobs. we should be on that bill today so people can start offering amendments and do something productive. no, what will happen on monday, they'll probably vote for it and then they will get the 30 hours to sit around and look at each other and do nothing, that's what the rules of the senate allow. so they accomplished more of their wasting time to prevent

the obama administration and the rest of us from accomplishing something good for the country. but we're going to continue to try. we have to do that in spite of the obstructionism of the republicans. would the chair annou >> this weekend, alex heard retells of the 1945 death penalty trial of willie mcgee. afterward, he spent 25 days in a dark cell after being captured by taliban fighters. sarah allison within inside attack of the murdoch's purchase of the "wall street journal." join us on twitter. >> c-span is now available and 100 million homes, bring you a

direct link to public affairs. it is treated by america's cable company. on thursday, the house oversight committee held a hearing on mortgage foreclosures. members heard from several bank executives about what they are doing to lower the foreclosure rate. this is a shared by congressman from new york. -- chaired tby a congressman from new york. >> the meeting will come to order. good morning. thank you forthcoming. it took massive federal event using billions of taxpayer dollars to save the bank from complete disaster. people and the financial assistance now stabilizing. they are beginning to make money

again. the same cannot be said for millions of people who are unemployed or who are in danger of losing their homes. the threat of foreclosure is still at an all-time high. more than 34 1 million americans are delete went on their mortgage by 60 days or more. the economic crisis is far from over for these people. as i have said the four, to its great credit, the obama administration recognized early on that an important part of the recovery is keeping as many people as possible in their homes.

this makes sense from both an economic standpoint and a public policy standpoint. i salute you for that. the home program is a central piece of the treasury department effort to carry out that objective. they had a troubled start. it appears that some significant improvements have recently been named. more than 1.2 homeowner's have now started a modification. 46,000-obtained a permanent modification. the immediate savings to the homeowners is a little over $500 per month. more than the number of permanent modifications has doubled in the last three

months. there are still major problems with hmfp. the chief complaint is a slow pace in which services are permanently modifying troubled mortgages. there is still considerable concern over confusion and conflicting communications from loan services and borrowers. while more modifications are being made, your delinquent borrowers appeared to be qualified for hmfp. most importantly, many borrowers who obtain a trial modification to drop out of the program late. in fact, it appears that a majority of the mortgage modifications paid on hmfp may not be successful. -- a deeply troubled issue found

that minority communities continued to experience significantly higher foreclosure rate then wipes regardless of their income level. this confirms moved similar findings reported by the national community investment coalition in the committees last hearing. today, i would like to hear exactly how this disparity can be addressed. clearly, we need to do a lot better than we have done in the past this is not just hmfp just. we have to recognize that hmfp cannot be the only solution to the foreclosure crisis and the some of the banks appearing today have began to save homes from foreclosures through reductions and other help for the unemployed.

the sound like a good first steps. i want to hear more. i want to see broad participation the route the loan industry. foreclosures is a losing proposition for everyone involved if you analyze it. the house and debate loses a big chunk of the investment. the committee loses the family with a stake in the community. i am asking the banks to help us find an effective way to stop the foreclosures. i want to thank our witnesses today for appearing. i look forward to your testimony. i will now yield five minutes to the committee's ranking member progressive. we will get five additional minutes on each side .

>> thank you thank you for holding today's hearing. there are recommendations for reform of the program to misrepresent the regional goals of the program produc. the tinkering in the housing markets have continued to feel the american people. this week, we learned the treasury has kicked for people out of the program then have received mortgage modification

burd. their perspective is necessary and helpful. the people respond to for the $75 billion of taxpayer money is simply a failure of oversight. i am disappointed that gao was not invited. they published a report this morning focused on the performance of mortgage services to coincide with their testimony. their perspective would have been liable for this committee. i respectfully urge you to invite the treasury department to answer in the near future. we have a responsibility to the american people to hold the

gestation accountable. what we hear from today have worked to comply a 800 rules issued in over 15 different set of guidelines. they have been able to offer far more mortgage modifications privately then in it. this congress administration has stifled private sector job creation the their anti-economic growth agenda. the policy mistakes of the felt by homeowners across the state. thank you. >> thank you. we did have a treasury. we did have jao you cannot do so much in one day.

>> i am concerned about the clans for the oclaims for their. growing number of borrowers are failing to move from the initial stage into a permanent loan modification. more than 100 our -- 100,000 borrowers lost their mortgage in may. more than have received another type of modification from their banks according to the government data. housing counselors have complained that those alternative low modifications are typically not as generous as what the government program offers. i am interested to see how it can be one of the toughest steps in the loan modification efforts tods.

i have held foreclosure prevention's in the district. i can tell you the key is that we have to have efficient programs. it is one thing to talk about them. it is another thing to actually carry them out. hopefully, people can help us get a better insight and how we think hcan keep people in their. house is the numbers 1 investment in most interesinsta. we need to be doing more helping people retain their homes so they can have the stability and so they can keep their families stable and neighborhood stable. with that, i yield back. >> the gentleman yield back. i now recognize mr. --

>> couud you clarify how the time is? for you saying there is five minutes over there and five minutes here? >> actually, he yielded back. you still have three minutes left on your time. now you have the entire five minutes. >> you said you'd knowledge the request by the ranking member for a representative from treasury. i can tell you that we came back. we are a hard-working committee. >> we have had treasury. >> you have not had been since monday when they had their report issued that says this program is failing. i have got some serious questions. yesterday, the treasury secretary appeared before the congressional oversight panel where he would ask a question. dino he said?

he said this program was not designed to prevent foreclosures. it was not designed to sustain the homeownership. he goes on to say what you think it to go to 65%? he said, i think you are describing the objectives that have shaped this program. the chair said, i was very surprised and very frustrated by the notion that the secretary seems to be saying that a program that helps on a tiny handful of families facing foreclosure is a successful program because the rest deserve to lose their homes. she says i thought that was shocking. i find it shocking. i find it inconsistent with the chairman's opening statement about what this program is to do. i find it inconsistent with what the president told the american people.

we have an absolute crisis. it is not over. i am from montgomery county, ohio. the rate is staggering. ohio has been the foreclosures continue to mount. clearly, this needs to be addressed not only by treasury addressing this program but also for the financial institutions and we cannot lose focus here that the financial institutions got this in this mess . the concern that i have is that decisions are being made currently that do not protect capital. every member of congress contended that the realtors tell them that it is virtually impossible to get loan servicers, banks, financial institutions to work with the

home buyer to get a short sale to do things that would avoid foreclosure. the test of the hmfp program is a post reserve capital banks. it is a program that not even the bank are pursuing. when you look at the market, any time the weekend avoid foreclosure, you make more. you preserve your capital. the market sustained more. when the homeless and foreclosure, prices in the neighborhood shop. why isn't this program working? but why aren't you operating in the market standard of capital preservation? we are continuing to proceed to foreclosure at rates where we all know people are approaching the financial institution with deals and offers a serbian rejected. they would have a higher return

pitahay. >> i now recognize mr. kucinich. >> thank you very much. >> you have three minutes. >> i'm going to take one minute. we know that the state of ohio received another $172 million so that people could be counts and individuals. i am grateful for the administration. servicers have been referring borrowers to foreclosure. they have been evaluated treasury had to intervene to put a stop to that. we know that ain't of america has produced bank of america has 13% permanent modifications, jpmorgan 22%.

city market, 32%. this whole program is about keeping people in their homes. we are finding death the servicers are not stepping up in a way that can encourage more and more people. we know that people are not given understandable reasons why their home modification program is tonight, that it is sketchy as to how people appeal a deny and to have the denials reviewed before the bay street " -- foreclosure. >> your one and it is up. >> thank you projec. >> the gentleman from virginia. we have to in a flood of the do

we have two minutes left. >> i appreciate our friends from the aisle. we want to make sure the program is better and working. i i think it is important to remember that our friends are the same ones that stood by and allowed for no are loose regulation decorated the subprime mortgage of will and the first -- bubble in the first place. not one person -- there voted in the majority vote. when we are looking at the subject -- i will not yield. that are not succeeding success. there are some among us of not help at all. thank you. >> the gentleman from north

carolina has two minutes. >> i would just say that my colleagues on the left is quite wrong. what he is saying is not the case. we want a workable program that will actually help homeowners, not one that does not actually help homeowners. it has been an absolute failure. if we talked to folks to in our communities, they will say it is not working. i have in front and center on this issue trying to help homeowners here in washington. it is the party over there that would do nothing about fannie mae and freddie mac which added the appeal to the fire of the subprime crisis.

rather than this guy blaming bush, let's move forward. we are sick and tired of this petty politics. we want to fix this problem, not there is some money at it. we want a workable solution. i will be happy to yield back. >> the gentleman's time has expired. >> i want you to know that we are putting things in the proper context. we have the treasury department testify at our first a hearing on this issue. treasury was questioned by the committee for more than three hours on the performance of hmfp that the first hearing. now it is the banks term. we are going to hear from them today. hmfp is not the only way to

address this problem. hmfp is just a part of the solution but not the whole solution. we need wholehearted cooperation of everybody across the board, even this committee fet. >> i think the american homeowners who are grieving right now do not care if it is hmfp or something organized by the banks. they want some relief. it is shameful that my folly for decollate fill the need to point fingers. the one thing we need to look at the conflict of interest that exists where there is a market and a second mortgage and the servicer has an interest in the

second mortgage and will not negotiate a modification with the first mortgage. that is a really serious issue. >> all time has now expired. in this committee policy that all witnesses raise their right hand. do you solemnly swell to tell the whole truth, the whole truth and nothing but the truth? you may be seated all witnesses entered in the affirmative. >> he is the chief executive pfficer of city mortgage, inc. welcome. mr. barber is the president of bank of america home loan, which

is the nation's largest home mortgage service. welcome. mr. david freeman is the president and chief a ticket offer of american home mortgage services, which is the nation's largest independent non-prime servicer. welcome. mr. david lomond is the chief executive officer of the home finance. welcome the. we are glad to have you here. at this time, i would ask the

witnesses to deliver a clear statement . there is a light that comes on in screen for the medellin and green. after four minutes, it becomes caution. then it rturns red. red means stop. i awnt to remind you of how it works. let's go right down the line. this allows an opportunity to raise questions. >> thank you. members of the committee, thank you for the opportunity to discuss the efforts to help families stay in their homes and describe our progress in implementing the modification program hmfp. i nbc zero of citymortgage brit.

we owe a debt of gratitude to the american taxpayer to provide funds. it is our responsibility to help american families and help families stay in their homes provincial as one recent example, last week citi came the first major lender to announce a 90 day moratorium on foreclosures in the gulf coast region. we want to help families that have been hard hit by the devastating oil spill to remain in their homes. at citi focus on two key priorities. working hard to make the program as successful asspossible and providing solutions for those who do not qualify for a fallen out of a hmfp process. our focus has to deal is significant results. we are ranked among the top

performing services. since 2007, we have assisted within 900,000 families in the efforts to avoid foreclosure. we know that the hmfp can be somewhat complicated. we strive to make it easier for our customers. it hired special stuffers to focus solely on day hmfp process and have given details. we've added more than 1400 new employees to support our for closure prevention effort. we had invested in the hmfp processing center so that hmfp applicants can view their application set is in documents online. customers are notified electronically when they meet the application process. we have learned that borrowers can be reluctant to work directly with servicers. we are working on outreach.

the partnered to conduct document collection of events in face-to-face meetings with borrowers who need help. our goal is to give every distress bar where the opportunity to reaches for assistance. we have designed a procedure to insure hmfp the application insure sanders for each applicant challenges remain. hmfp has been revised multiple times since march 2009, which easch change required. we are moving from a truck modification to him modification. the required documents and not cemented. -- implemented.

since the program does not fit every distress of our hour, and citi is providing solutions. as part of this effort, we offer a number of supplementary modification problems that are designed to address customer needs on the case by case basis the solutions are tailored to homeowners to meet their consensus and make it affordable. the own party program assist customers to a variety of solutions such as unemployment and imminent risk of default and utilizing a variety of strategies for affordability prad. these are described in the appendix in more detail. we believe the issue of affordability is the most important consideration in modification.

we do not believe there is a one-size-fits-all approach. the proof of this is in our -- for the borrowers who face hardship, we introduced dedicated, which offer customizable solutions we are participating in programs when they become available. these programs allow for a dignified transition to the next part of their lives. there is much more work to be done. cit remaini focus in achieving a portability but the thank you for the opportunity for them -- profitability. thank you for the opportunity. >> thank you for holding a hearing on this very important issue. since january 2008, bank of

america has completed more than six and a 30,000 loan modifications. we continue to innovate with the acquisition of countrywide, bank of america's portfolio changed dramatically. . .

bank of america has participated in more than 300 community outreach events, opened assistance centers come and gone door-to-door to help customers understand their options. we are also participating in the hope now program so housing counselors can directly submit completed customer applications. there have been rough spots. customers have experienced a service that is very inconsistent with our standards. we continue to learn and improve as we work through these difficult times, never losing sight of the impact of that foreclosure has on the individual or the community. since hamp launched in march of 2009, bank of america has build momentum in the program. for the past three months, we have led servicers in the number of completed modifications. bank of america came the first major servicer to begin implementing the second lein program on april 13 we took this step to provide customers a more affordable combined monthly payment. this march, we announced a

principal reduction program for qualifying customers who 0 significantly more than their homes are worth. we began mailing offers on may 17 to provide immediate relief to those in the most imminent danger of foreclosure. treasury announced a similar principle reduction program that will be effective later this year. we are working to align our own programs with theirs. as we execute the programs, it's vital to understand the current eligibility of delinquent customers. many customers do not and will not qualify for hamp. within bank of america's servicing portfolio, 1.4 million first mortgage customers are more than 60 days delinquent on their mortgage payment. of those customers, treasury estimates that 470,000 are potentially eligible for a modification through hamp. as of the end of may, bank of america has mailed more than 1

million solicitations, made trial offers to over 400,000 customers, started active trials with over 300,000 customers, and we have 70,000 permanant modifications under hamp. hamp has been largely successful in making offers to customers. accept the offers and complete the requirements required to obtain a permanant modification has been a challenge. in april, bank of america began hamp process changes that will require documentation up front before the trial period starts. we believe this will improve. still, a considerable amount of customers will not be able to afford their homes. in these cases, we invite customers to consider short sales.

we inform customers about the options as part of the hamp decline process. they receive letters that clearly states the reason for in eligibility. more than 40% of the declines we have mailed are because of missed payments in the trial period. bank of america provides a dedicated toll free number for customers to appeal the decisions, provide updated financial information, or discuss other options. we will not complete a foreclosure sale until the appeal period has expired create innovative solutions have been created to help customers sustain home ownership and bank of america is committed to executing those programs. all of us at bank of america, including the thousands of associates who worked on these issues every day, take seriously our role in helping people through this difficult cycle. thank you. i will be pleased to take questions. >> thank you.

mr. friedman. >> we at american home appreciate the committee's consideration of the complex issues surrounding servicers to implement hamp. this is a non prime servicer, that does not own or have interest in any of the loans that we service. our focus is on keeping borrowers in their homes while balancing our continued cash flow to investors. contrary to popular opinion, servicers do not make money on foreclosures. they benefit no one. there undertaken only as a last result when other foreclosure solutions are not available. we aggressively pursue any modification possibility in

early intervention. all troubled loans are routinely reviewed for hamp. although we have made it through solicitation efforts of our portfolio, we are again in the process of we soliciting every borrower that has potential for hamp eligibility. to assist borrowers in avoiding foreclosure, we have established a dedicating team of counselors and call center associates. we have invested in the development of improved proprietary information systems, build relationships with housing agencies, counseling agencies, and housing alliances, participated in outreach events, considered borrowers for proprietary modifications in situations where we are unable to offer a hamp modification. we have offered other foreclosure alternative solutions. several barriers remain,

despite significant process by the industry. even with the relaxed standards, the required underwriting documents are too burdensome. many borrowers are unable to provide these documents, or they simply choose not to do so. servicers who experience re- default rates of less than industry averages should be allowed to rely on their less prudent requirements. others are confused by program enhancements that are prematurely announced. frequent program changes have overtaxed servicer systems. the newly announced program has

increased the number of so- called strategic the falters -- defaulters who purposely stop paying their mortgages to get hamp assistance. the hamp program has experienced significant issues in converting trial period plans to permanant modifications. many failed to make the original payment and are now permanently ineligible for hamp. the complexities of the hamp reporting system have made it difficult to officially report many permanant modifications. not all borrowers qualify for hamp modifications to the top three factors for denials are the property is not the borrower's primary residence,

or the documents restrict modifications, and the borrower failed to provide a complete underwriting package. we have developed an appeal process. borrowers that do not qualify for hamp modifications are reviewed to determine if other options will prevent foreclosure. we maintain a robust tracking of resolution process that is dedicated to handling borrower complaints 3 take our responsibilities under the of hamp program seriously. we have been audited twice. there were no major findings or enforcement actions. burdens on servicers -- while performance is improving, the

challenges persist even as the program matures. in conclusion, we are firmly committed to hamp and to its goals and standards. we're anxious to see the program succeed. we look forward to working with the treasury and congress to implement any needed improvements. thank you for your time. >> thank you very much. mr. heid. >> i am mike heid. thank you for the opportunity to share the results wells fargo has achieved. because of the choices we have made, are disciplined underwriting, and the manner in which we approach foreclosure prevention, delinquency and foreclosure rates were 3/4 the industry average. just a few examples of the actions we have undertaken to achieve these results since the january 2009 through may 2010.

we have helped more than two 0.2 million homeowners with new loans, either to purchase a home or refinance existing mortgages. we've existed a half a million loan customers with trial or completed modifications. 1/5 of those are through the hamp program. we assisted more than 100,000 unemployed customers with short- term modifications. starting in january 2009, we lead the industry by permanently for giving more than $3 billion in principal for more than 55,000 customers, which amounts to more than $50,000 per loan. we have begun offering home payment relief to customers affected by the oil spill. with respect to loan

modification efforts, while difficult to achieve, we believe we must continue to balance the needs and interests of homeowners in financial distress with those who have remained diligent in making payments. much focused, deservedly, is directed to consumers behind on their payments, we cannot lose sight of the fact that 92% of wells fargo customers are current in their home payments as of the first quarter of 2010. hamp is a good option for people who meet certain criteria. by the treasury department's own april 2010 estimates, only three out of every 10 customers are potential candidates for hamp. as a result, servicers and investors have additional programs for customers not eligible for likely will not qualify for hamp. taking all of these programs into account, about 2/3 of wells fargo's customers more than 60 days behind on payments are provided an option to prevent foreclosure. finally, with the plan, it is

clear the industry was not prepared for the customers facing financial verge of as the economy became more challenging. wells fargo is not always consistent in providing the level of service we expect to deliver. we have committed tremendous resources over the past year. we believe we've come a long way in improving our service. we have hired more than 10,000 people, for a total of over 17,000 jobs. by the end of this month, we will complete the process of assigning one person to manage one loan modification from beginning to end. our customers will know exactly who they're working with from start to finish. we continue to work with other industry participants. we have this done with 27 home preservation centers in six states where we have

concentrations of @ risk customers. we all give wells fargo customers a short sale decision. we continue to have a dedicated phone line for your staff to use in the event one of your constituents, our customer, has an event. we will continue to assist homeowners freed we believe very strongly and feel very deeply about our responsibility to help homeowners in a balanced and fair way. we believe our actions demonstrate our commitment to achieving this goal. thank you for your time today. >> thank you very much, mr. heid. mr. lowman. >> thank you for the opportunity to appear before you today. i am the chief executive officer of home lending at j.p. morgan chase. j.p. morgan chase shares your commitment to helping homeowners and stabilizing the housing market in our country.

we're working to help families stay in their homes by making their payments affordable. we have helped prevent hundreds of thousands of foreclosures through our own proprietary modification program, hamp, and other programs. we have refinanced $21 billion of loans under harp. hamp modification performance has been strong. we are completing more than 10,000 permanant modifications per month. on average, home owners see their monthly payments reduced by more than $530, 28%. we are adopting an implementing the federal government's second lein modification program to help more borrowers. actively use temporary forbearance agreements, similar to the program recently announced by the administration. you asked us to focus our

testimony on how we can make foreclosure prevention initiatives more effective for borrowers. from the beginning of 2009 to the end of may 2010, chase offered almost eight hundred 50,000 modifications to struggling to homeowners and made 172,000 permanent under hamp and other programs. chase has offered hamp trials to nearly 260,000 borrowers. of these, over 80,000 are in active trials, and 48,000 have converted to permanant modifications. hamp loans with a meaningful reduction in monthly payment perform very well. once borrowers have successfully completed the three-month trial period, they are completed faster than even we expected. we conduct extensive outreach and have made significant investments in people, technology, and infrastructure. we have developed a more

creative approaches to reach borrowers in ways that work for them. we have opened 51 chase home ownership centers in 15 states and the district of columbia where 88,000 borrowers have met with our counselors. on top of that, we've launched a national out reach tour. the events last four to five days, and our staff on the weekend, where we can help borrowers. the response has been very positive. half of our entire staff in chase are dedicated to helping homeowners. 700,000 deal with only loan modifications for borrowers in financial difficulty. there are several challenges of

implementing hamp the. biggest challenge is that it was designed to help a specific population of borrowers. as illustrated in the department of treasury's recent report, only certain borrowers are eligible for hamp. now that certain documentation is required up front, we expect the conversion rate to increase substantially. failure to make the required payments should be the primary reason that someone does not convert from the trial plan to a permanant modification. another challenge has been the continuing evolution of hamp. we have had to adjust our systems and we train our people as the program changes. the evolution of the program has expanded opportunities to keep people in their homes. we do not want to miss a chance to help borrowers stay in their

homes, so we individual review each case, and we will extend the trial period. where borrowers are making their payments in hamp trial modifications, but may not qualify for a permanent modificatioo, we believe we are able to qualify those borrowers for other programs. similar to our loan origination business, chase is committed to full compliance with the letter and spirit of all their lending laws. regardless of race, national origin, religion, age, gender, or any other prohibited bias. we are pleased to have this opportunity to share our progress. we are looking forward to working with members of congress, the administration, banking regulators, and community leaders in implementing these initiatives and help stabilize communities. >> thank you very much.

>> thank you for the opportunity to testify today. in discussing hamp, it's useful to recall the original goals. those were to help as many as four million financially struggling homeowners avoid foreclosure by modifying loans to a level that is affordable for borrowers now and sustainable over the long term. second, to provide consistent loan modification guidelines, third to determine eligibility upfront. i testified last february before the subcommittee of this committee and advised that rather than avoiding four million four closures, hamp at that juncture would likely help just 250,000 home owners stay in their homes. it appears that my estimate from february was close to the mark. the success rate is so low, due to government initiatives mandating looser standards -- its this legacy of government mandates for weak loans that makes it difficult to achieve successful modifications.

i expect a 40% -- i expect 40% of permanant modifications will re-default. there are only two words to describe hamp's guidelines -- numbing complexity. at last count, there were eight hundred requirements. treasury also promised that a borrower's eligibility will be determined up front. recently in "the wall street journal" -- it has led to many crushed hopes. instead of a quick yes or no, homeowners are placed in limbo. in february, i indicated that the january pipeline of hamp would likely yield only 250,000 holders that would avoid foreclosure under hamp, only 6% of the announced goal. it has slowed in the last months. the number of new permanant

modifications last month was 30% below april. as of may 31, 2010, there were 340,000 active permanant modifications, assuming a 40% default rate, only 200,000 will be successful over the long term. 468,000 trial modifications -- of these, only 75,000 will become successful, long-term permanant modifications. the current pipeline will yield about 275,000 successful long- term permanant modifications, with perhaps another 100,000 successes' resulting from

future trial modifications. there have been other repercussions freed interest strategic defaults, homeowners willing to default. -- other repercussions. it encouraged strategic defaults. researchers at northwestern university found the percentage of foreclosures perceived to be strategic was 31% in march 2010. that is up dramatically from 22% in march 2009, when hamp started, with more borrowers believing that -- there's a risk that a growing number will walk away, even if they can afford the monthly payments. hamp has slowed down the

foreclosure process. it is likely extending the time until the market corrects. perhaps the greatest shortcoming of hamp is that it has the world efforts of the private sector. the office of comptroller of the currency -- the report that is produced quarterly. one chart demonstrates the private sector had been rapidly ramping up modification efforts in 2008 and 2009. when hamp started, those efforts were derailed. chart two indicates the private sector was having greater success with reducing the re- default rate on loans outside of the hamp program. chart three demonstrates the slowdown of the hamp program as new trial modifications have fallen off precipitously. now the number of permanant modifications has also started

dropping 3 the committee should ask the treasury department, where are the modifications the private sector was on track to produce? this committee deserves an honest assessment as to hamp's future. thank you. >> thank you very much. thank you all for your testimony. i guess the question is, why have there not been more permanant modifications? what is the problem? mr. das, why do think there has not been more? is it the lack of money? what is the problem? >> as we all mention, we put an enormous amount of resources to open this up to as many trial modifications as possible. we opened the door to as many people as we could. >> how long should it take for the trial modification? how long should that take? >> it takes about four months,

which happens to be the fastest in the industry. we have three trial payments. that converts to a permanant modification after that 3 to answer your question, i believe the reason the permanant modifications are not as high as expected, i believe that is because, in many cases, the documents that, and do not match with what was stated at the time of the trial modification. many borrowers are not able to make the payments. those are the two principal reasons. >> under the hamp program, 40% of the borrowers who have been in a trial modification have failed to make a payment. i think that is reflective of the ongoing stress of the

economy on those borrowers. i think it is important to look at the number of permanant modifications holistically. hamp is a small number of a much larger total of the 630,000 modifications. it is one of many tools. >> the same question to you. >> in our situation, we serve as a lot of loans that do not qualify under the guidelines. such as a conforming loan or non conforming loan. we may have certain restrictions, but the vast majority of the real issue is that --

>> we are so limited by this income tax and that in our book of business the borrower must occupy the property as their principal place of residence. and then also the documentation issue. we initially, up front, had done all this verification and requested documents up front. so once we have got a borrower into a plan we have a very high conversion rate. but again, a lot of this is on the borrower's side as well, or the complexities of the program itself. >> i would like to add i think context is important here. think about the half a million mod's wells fargo has done. a lot of those are outside of the hamp, and a lot of them are on their way to becoming permanent. inside the hamp program, inside the 20%, the income are the same as in the report -- lack of documentation because of

last summer. that has since changed. what documents are received -- customers are not eligible for the program and go to a consolation -- a consultation -- a cancellation face. the three primary hamp factors -- i would encourage you to keep focus on the fact that the vast majority of mods getting done are happening outside the hamp program itself. >> just echoing the same thing that my compatriots here have spoken about, missed payments and no documents returned from borrowers are the major reasons modifications do not get completed. about a third of those that do get -- that do give us documents and do in fact make the payments, a third of the total population ultimately end up in a mod. >> when you say you do not get

documents is a lack of communication? >> we have made extensive refinements in our process, including communicating with our hours, writing them letters, knocking them on doors, and what have you. at the beginning of the program, then may have been the case. now, we are equipped to adequately communicate with our hours. >> this communication problem? very quickly, could you sort of tell me? "i think the issue is as to sort of analyze the contact rates it seems to us that at the late stage of delinquency a lot of customers have a very low contact rate, primarily because they may have checked out from the process. so this needs -- early

intervention is really critical. >> is there anything that we need to do? there are people losing their homes. and i cannot see, if somebody is losing his or her house, there will not cooperate with documentation. that is their house. that is the part i do not quite understand. >> a couple of examples might help. there are a lot of customers in fear of losing their home. we are doing everything we can to make sure that does not happen. documents that are troublesome -- the hamp program does require a tax return. that conjures up fears that it

will trigger an irs audit. those fears are real. the hamp modification agreement itself is an intimidating- looking piece of paper. it is five pages, single spaced, and intimidating process that people are reluctant or fearful of what else might happen here. i do not think it is the communication between servers are an homeowner that is at issue. i do not think there are additional things you should and can do. this is a matter of working very diligently and very hard with every single customer to make sure that disclosure -- that foreclosure does not happen. >> hamp has not only failed to help people. it has harmed families in two ways. one is the comments the "wall street journal" had, related to my opening statement. people were never qualified in the financial implications of going through that process. i think the point mr. pinto raised -- he thought it drilled private-sector efforts to help. i think in two ways it has not only been a failure to help but has potentially cause harm to the families we're trying to get help to come up prey -- trying to provide help to. the numbers you gave -- i have

900,000 for city, 600,000 for bank of america, 500,000 for wells fargo, and 846,004 jpmorgan. what number of the modifications you have made our hamp modifications? i took those as being the big number? >> since 2007, we have had 900,000 homeowners. we additionally extended hamp to 150,000 homeowners, and 38,000 have taken hamp. >> 630,000 permanent modifications since 2008. 70,000 of them are hamp. >> we have reported out about 8800. we have about 16,000 currently in trial periods. >> for permanent? >> the 88 is reported out as

permanent. >> 88,000? >> 8800. >> we have 500,000 mines. 38 percent of them are inside of hamp. there are probably 45,000 of those in permanent. >> less than 10%? >> to under 57,000 in hamp. >> how many are permanent? >> 47,000. a very small number. we are talking less than 10%. >> the people who qualified for hamp went through this cumbersome process, a hundred different rules and all the stuff they had to go through. i describe the intimidating profits. the small number -- how many of those -- let us as it this way. the people who qualify for hamp -- would any of those not

qualify for your own modification program? >> let us put it this way. for the people that fell out of hamp, we were able to save 50% more. >> you were able to help? and it is working? >> it is working. >> i cannot tell you the exact number, but the potential exists because of treasury incentives that have made it made more sense for the investor to be a much hamp vacation. many of those would have qualified, but i do not know the exact number. >> about two-thirds would qualify for proprietary mods. >> two-thirds of the permanent? what is the number? >> the question i believe was of the hamp participants how many would have qualified under proprietary modification programs. about two-thirds of those would

have. >> of those in hamp who got into permanent status, would any of those not have been in permanent status with one of your programs? >> only those who would be limited by investor concerns under our servicing agreement. so a very small amount. >> i think a time stamp on this is important. i think right now, with all the programs available, the majority of customers would probably get on. to the other point about customers that are canceling out of hamp, the treasury provided some statistics earlier in the week. in wells fargo's case, 70% to 80% of the hamp cancellations result in some other form of saving the home or avoiding for closure. >> most would qualify for the

proprietor program. >> we have a program which promised $75 billion that would help 386,000 get into permanent, yet the vast majority would have made it in one of your own modification programs without this big government hassle. those that got kicked out -- we are also finding out the majority of them you could have helped. >> about 60% of the hamp mods are fannie and freddie. that is the majority of it. they do not need to be paid an incentive to do what they need to do. >> a great point. >> the gentleman's time has expired. let me go out to miss spier -- she said something i agree with. hamp is fine, but my constituents -- i want to have some kind of relief. so what ever it takes to accomplish that is what we are trying to do. in my district, we hold foreclosure prevention conferences. we have done four of them so

far. we just did one of them about a week ago. as i listen to your testimony, i understand better now why we are able to save at least two- thirds of people's houses. a lot of it goes to when you talk about documents. what we found in our office -- a lot of times, it is an intimidating process with regard to these applications. we have to people on our staff. what they do almost full time is help people with foreclosure. it is a difficult -- it is not

the easiest process. one of the reasons why you cannot -- it is so difficult for people to stay in the temporary phase is because they are not getting the proper documents in an are not turning in what they are supposed to. what we have found is that a lot of times the mortgage companies are understaffed. i can tell you that for effect. it has gotten better. so when people would call in the could not get anybody on the phone. then if they got somebody on the phone they got the runaround. and then if they got somebody and were unable to avoid the runaround the paperwork got mixed up. i have seen instances where paperwork has been sent to folks going to the mortgage companies four or five times,

and some of the same company sitting here now have said to my people, and i have noticed for effect, that they never got it. and we have actually sent paper work from our office. so i am wondering what you all have done with regard to staffing. training stuff -- it is one thing to have staff. it is another thing to have a staff that is properly trained. what have you done with regard -- it seems like you are saying that in order for people to move from a temporary to permanent, it seems like paperwork is one of the main things holding them up. i think ms. desoer said some people are not making payments during the temporary stage. use of 40%? we do not find that.

we find people who want to make payments. we have found a lot of people who have made payments and the mortgage company told them they did not. my staff would have the copy of a check or money order in their hand. there is a disconnect here. so the question is, outside with you, mr. heid, since i am kind of familiar with wells fargo, what you're doing with yourself and. have you found that with significance? if you did staff up, how did it affect the operation and your results? >> i think your criticism is very fair a year ago. we were not where we should have been a year ago. we made a lot of progress in the last year. we have attended your events. retreated your events -- we created our own events together documents. our 121 approach -- every single customer will know exactly who they are working with everyone on our side knows which customers they are accountable for in a one to 1 way. we have helped over 10,000 people in the course of the last year. >> it is kind of expensive. would you rather see somebody in the house and the foreclosed upon? >> absolutely. >> why is that? >> foreclosure is the last

result for a lot of reasons. one, it is the right thing to do. beyond the right thing to do, it is always in our shareholders' interests, the community interest, customer interest to keep them in the home or find an alternative to foreclosure. everyone sitting at the table would say to you foreclosure is absolutely the last resort. >> i sit on the conference committee for wall street reform. we had an amendment yesterday to make sure there was a fund of $3 billion to help people who have lost their jobs. every single republican voted against it. every single one of them. i heard some say earlier that enough was not being done by congress. fortunately, it passed on the

house side in the conference. i see my time is up. perhaps i can get some answers to whether you all believe such a thing is very important later. >> mr. turner? >> thank ou, mr. chairman. thank you for all being here. and thank you for being so helpful in your answers, because as you know we are all struggling and trying to figure this out. you have specific expertise not only in your view of the government program but in the issue of what is happening in the market, what is happening with homeowners, and what needs to be done. i appreciate you have been so forthcoming. as i said in the opening, treasury secretary geithner, yesterday, when appearing

before the congressional oversight panel, hamp said,, "this program was not designed to prevent foreclosures." it was not designed to sustain home ownership. he was then asked about the home ownership rate level. what would be a market- efficient number? someone offered 65%. he tended to agree that was an objective. geithner said he agreed with the assessment that housing will only stabilized as more homeowners become renters again. do you guys agree with that? do you agree with our treasury secretary that the market will only stabilise as more homeowners become renters?

that seems contrary to what our whole goal was in trying to stabilize homeowners in their homes. >> congressman, i am not qualified to answer the treasury secretary. in response, i would say that when we focused on hamp as an industry we wanted to create a uniform base line across the country. there was no baseline modification. there were all kinds of proprietary programs. in the last year, we have done a great deal with respect to hamp to get to a uniform baseline. however, there will be followed and there will be defaults. i think the focus needs to move beyond modifications to foreclosure prevention. i believe those are the programs we should focus on. >> do you believe more people need to be renters? >> the hamp program and other modification programs are built to ensure that the payment is affordable. what hamp has done is set a new standard for the industry at that 31% debt-to-income ratio. in that spirit, there are a large number of people who would not qualify. and i agree that at some point if they cannot afford to sustain a mortgage payment at a level commensurate with their income than they do need to move on to alternative kinds of housing, and that is what other programs are attempting. and we are working hard to assure there is a dignified transition as an alternative to foreclosure.

>> i disagree with the treasury secretary. it is not that he is talking about the individual decision of a home owner as a borrower who find themselves in an untenable that position and must make the choice of leaving the home, rendering it, going through the process of becoming a renter. he personally believes that more homeowners should become renters, according to reuters. that seems contrary to this program. he characterizes it as this program was not designed to prevent foreclosures. i could have sworn that was what president obama said it was supposed to be.

mr. friedman, what do you think? >> i was not around the secretary when he made the comment, but i do believe it is a fact that not all homeowners can afford their mortgage payments. and as a result, like many of us, if you spent too much money on something you have to cut something else out. that could very well be what he meant. i think as a general policy of homeownership is a great thing, if people do not get greedy and can pay the mortgage and can afford all those things that go along with home ownership. >> my time is expiring. in listening to all of your testimony is about how you have been approaching homeowners i can tell you that the anecdotal stories that we hear from realtors, from nonprofits try to assist homeowners, is that loan servicers are not responsive, that it is an incredibly difficult process even when you

have a social worker that is sitting and guiding someone to the process. that in fact you are making decisions that do not model the market. when their a short sales that are offered you allow it to go to foreclosure. one thing that would be really helpful is to have not a panel of loan servicers but have loan servicers on one side of the room and of realtors and nonprofits on the other side of the room and let people go at it. we are having a different story than your telling us today. >> mr. chris image? >> thank you very much, mr. chairman. -- >> mr. kucinich? >> thank you, mr. chairman. each of you represents lenders that would not exist in their current form if not for the beneficence of the united states taxpayer. i remind each of you that without the continued support of the american taxpayer there would be virtually 0 residential housing market activity. the issue before us today is why

in the world aren't you giving loan modifications to more eligible borrowers? why are you denying loan modifications to my constituents, despite the fact that we have a federal program which pays you, the mortgage holders, an incentive to modify the terms, and compensates you from any of your costs? i would like to hear some justifications. mr. lowman? >> we are helping all of the people that come to us and that we contact. we have made extensive investments in people, systems, infrastructure, and the folks that do not get a modification. it is generally for two reasons. either they failed to pay us during the trial. or they do not qualify for the programs. maybe their income is not enough to afford a home.

or they do not provide the required documents. >> let me share this with you. at the end of may, my state of ohio had 136,000 seriously delinquent loans. only 12.95% of those loans have been modified. ohio is 42nd out of 51. in early may, i held an open meeting in my district with treasury assistant secretary alison. in that meeting, i want you to know that in cleveland ohio i learned from numerous advocates that your bank is the most difficult one to deal with when it comes to loan modifications. over and over, i have heard that chase has been especially slow to process paper work. i have heard that chase denies far worse modifications without supplying a reason. i have heard that chastely as

far worse facing foreclosure in limbo. -- i have heard that chased leads to borrowers -- leaves borrowers facing foreclosure in limbo. why is the trial modification for chase mortgages nearly 7.5 months? >> american samoa all of us have mentioned, the resource needs for this program have outstripped our ability to have the right number of people in seats performing their functions. >> so you're saying you do not have enough people to handle the program? >> we have historically not had enough people to handle the demand for the program. we were one of the first out of the box when the hamp program

was announced. we started accepting applications. >> excuse me, because i have limited time. i am sorry to interrupt you. the program has been going on for 19 months. >> that is correct. we have hired thousands of people. >> it seems to me you know the demand. your performance is very weak. if you know there is a demand and you are getting incentivized from the taxpayers i wonder how hard you are really trying. that is the concern that i have. when i get reports from my own constituents that you are denying modifications without supplying a reason in your living bars facing foreclosure in limbo your explanation does not cut it. >> the increased our staff. we have invested in our systems. we have historically had a backlog of loans that are in trial. and now we are literally

looking at a loan -- at every loan that is beyond its original trial. , looking at it loan by loan, making sure we do not leave any stone unturned to give folks a modification. >> what do i tell my constituents when they tell me chase will not work with them? >> they should call the 1-800 number. >> should i call that number? >> you should call it. >> i can call you, mr. lowman, on behalf of my constituents? >> yes. >> we can chat afterward. >> i would be happy to do it. >> i want to help you do more and better. >> we have a number i can put on the record. it is for anybody who has

constituent complaints. we would be happy to personally do with them. >> i want to make sure it is not like those bumper stickers that say, "if you like my driving, call 1-800." >> thank you, mr. chairman. we have a memo that says more borrowers have been kicked out of hamp than have received permanent monday petitions -- permanent modifications. 429,000 temporary modifications out of 6300 permanent -- and of 630,000 permanent modifications have been canceled. they estimated that 75% of permanent modifications will ultimately default. i am also told that part set aside $75 billion for this program but only $30 million has been paid out in the first year and a half. in that rate it would take roughly 200 years to get all this money out, which seems to me ridiculous that they set aside that much money for what now appears to be a failed or failing program. i just heard in response to the question from chairman jordan that only about 10% to 20% of your loan modifications are under the hamp in the first place. we were told before the hearing

-- my understanding is that has been confirmed by most of you that almost all of these modifications under hamp you would have tried to work out through your own private modification programs. so i do not believe i have ever heard of a program that is doing less or working in a worse way, just about. i am wondering. i am wondering if any of you would dispute what mr. pinto said when he estimated hamp estimated will ultimately meet only 6% to a% of its original goal. he used the words numbing complexity. do any of you dispute that estimate, that very pessimistic estimate that he has presented here today? or would any of you dispute his

description of the requirements as being numbing complexity? >> i am not sure i would use that phrase to describe hamp. i believe that we all stood beside hamp and created it together with the treasury department. we wanted to make sure we had one uniform program. we really focused on scale on that program.

i think it is important for us to understand that we all collectively got behind this program and focused on scale. last year that was not the case. more importantly, we got the gses to come when the program. all of our laws and litigators had one program they had to deal with instead of nuanced proprietary programs. i believe hamp worked when it needed to. there is a part b to that, which is that this problem is moving forward. i believe we now need to focus on fallouts from hamp. we need to focus onre- defaults. we need to focus on a targeted for closure prevention problem. i think hamp served its purpose when it did. i want to applaud my colleagues for having tried as hard as they did, along with myself, in scaling what was an important response to homeowners at the time. >> before hamp, i think one of the significant advantages has been the establishment of

standards, and in particular the debt to income ratio that was higher than the 31%. to establish that as a standard that is usable and customary, where we can work on behalf of investors, has enabled the results we have with hamp, but equally importantly the result we have in our prop. programs. that is a significant advantage. >> if it was working the way it should, your companies would stand to make a lot of money out of it and become government contractors, at least to the extent for this program. thank you very much. >> following up on that, if treasury had set it at 45%, 55%, would do not have more loans going out today? >> this gentleman has expired. mr. lynch? mr. lynch?