on the ground, but really in the last six months have big investigations revealed what is going on across the industry. that is the famous robo sign. is a phenomenon of the mortgage servicing industry. it mortgage servicing sprung up along side securitization, the way we finance mortgages by chopping them up, combining them and selling them i did to federal government agencies or private banks. when the housing bubble popped and suddenly a lot of people were delinquent on their payments, foreclosures were happening, people wanted to negotiate with someone, the

services were overwhelmed. they started cutting corners to speed for closure. they started doing all kinds of pernicious practices. the government's main response was the home affordable program where, essentially, the treasury asked to the servicers, in exchange for bribes, a big cash payouts, to modify loans to affordable levels. that has essentially been a failure. hasn't met expectations. it has been slow. it has been blamed on the servicers. this past summer, we encountered the robo-signer. a loan officer testified that he had signed 10,000 affidavits, testifying that his bank had the right to foreclose on homes. that is one per minute if you expect a 40-hour work week. it is hard to of you -- first -- hard to expect of someone could

do all the things they legally would need to do in that period. it is clear that these practices are widespread. how widespread, we do not know. other practices like filing loss-notice -- lost-note affidavits when the notes have not been lost are also prevalent. we have serious over -- serious uncertainty over roe owns -- who owns loans. as good as that -- this could affect as many as 20 million loans. 90 percent and mortgages were securitized. it is incredibly widespread -- 90% mortgages were securitized. it is incredibly widespread. what we've seen has not been matched with legal innovation. we adopted this high-tech, 21st century way of financing

mortgages on to an old legal system. on a basic level, if you are taking away someone's property without due process and standing in the courts, that is a fundamental problem for capitalist system. on a more straightforward level, when people and states pay for their mortgage loans, the cost of bankruptcy figures are included. these people are being defrauded. this issue of the revelation of these practices has a couple of consequences. the state attorneys general have launched an investigation. clearly, on the state level, there are legal penalties. it is clear that they want to try and do something to find a settlement that helps troubled homeowners while assessing the right amount of sanction to the servicers. there is also broader things happening. we have this high-tech procedure that is really not being matched

on the legal level. across the country, there are meetings going on -- mediation where borrowers and lenders are meeting with an independent third-party, an old fashioned solution to a new problem. this pervasive sense of injustice with the servicers is perhaps an opportunity for more mediation to scale up to the national level. it is also revealed -- has also revealed problems with the h.a. m.p. program and with the fledgling financial protection bureau that will be charged with watching these industries -- this industry. it has raised questions about what needs to be done to make sure that is working effectively. finally, as well as creating problems in housing market, we're also seeing systemic times issues where investors who bought these mortgage-backed

securities are realizing that, if the chain of ownership of these mortgages is not clear, maybe their securities are not, in fact, mortgage-backed. they will be some people who created these investments, attempting to shift the failing loans back to the balance sheets of the banks that originated them. it is unclear how much this could eventually cost these banks. could be hundreds of billions of dollars. it would be a serious threat to the health of the financial system. losses of that magnitude could be very problematic. we do not know the extent of the problems yet, except that they are pervasive. we do not know their consequences. we do know it is an opportunity to talk about how to fix these issues, rebuild the housing market, and look to the future so it does not happen again. serving industry has become more than the middle man -- the servicing industry has become more than just the middle man. hopefully, the folks with us here today have some good ideas

to fix the problems. i want to introduce the panelists. we have a former financial adviser, now a fellow at the roosevelt institute. his writing on financial regulation and reform has been very influential in the last couple of years. he will talk about a little bit about -- a whole bunch of stuff. he has a basic run-down on securitization. we're also joined by an attorney working for the center for american progress on mediation for borrowers and lenders as a solution to foreclosure problems. we have julia gordon, a senior policy council at the center for responsible lending, with us who was worked on all of these issues for a long time to she is one of a big -- for a long time. she is one of the nicknames. we have the deputy chair of the congressional oversight panel on

t.a.r.p., which just released a major report on these issues. he will talk about a variety of issues related to this estimate does risk factor. he is also director policy at the excelsior some -- related to systemic risk factors. he is also director of policy at the afl-cio. for starters, here is mike. >> thank you. i would like to demote him and america for hosting this very important and timely -- thank tim and new america for hosting this very important and timely panel. i want to tell you why you should care about this. i want to outline some solutions and incentives and motivations of the players who are trying to figure out the end rules.

to start, i will assume that people here and watching at home have real wide distribution of knowledge and familiarity with this crisis. i will start simple and then get complicated. a mortgage as two parts -- the note and aline -- the lien. the notes is the actual i'll you -- iou. the role of the note is to explain the debt and the terms associated with the debt. this is where you get late fees, things that come up with distressed debt, things that show up in court. the mortgage itself is the lien. it uses the collateral to say, if you do not pay your debt, we can take your home. the note is a negotiable instrument. consign it over -- you can sign it over. it forms the basis of the securitization process.

securitization -- mortgage- backed securities -- they start with a mortgage originator, like countrywide. creates a mortgage with the homeowner. it takes a note and other associated documents and passes it to a sponsor. sponsors are often a investment banks like bear stearns. the sponsor takes the document and moves it to a depositor. this has to do with something called bankruptcy -- we do not want to have exposure to bear stearns or investment banks. the depositors take the notes and mortgages and turn them into mortgage-backed securities. here is what has been happening here right now, trying to get our arms around her much of the crisis -- this comes from the case that just about a month ago. countrywide, as far as people who understand who worked at

countrywide, were not passing these notes through. why is that important? it is important for a couple of reasons -- three reasons. one is that they assigned things like service agreements. one is that the actual infrastructure requires that the notes to be there as part of the due diligence. it requires the notes to be there as protection from limits, protection from these being constructed poorly. these are some cards that investors rely on monday by these things -- safeguards that investors rely on when they buy these things. they're designed to take money on one side and what it out on the other. there is meant to be a clear path. they are not supposed to be doing a lot of things, seeking out mortgages, actively looking for, buying, or moving notes around. in promoting these contracts, they have about 90 days to get the notes in there. the third thing that is relevant

is that, most of these mortgage- backed securities are formed under new york trust laws. it is a very strict law for a good reason. we do not want people creating trust to go buy lunch or do leveraged buyouts or what not. we wanted to be bored very specific reasons. these notes need to be passed through. the intentions do not matter. there's nothing else we do with these. the contracts are very strict about this. so, it is also worth stepping back and realizing that this system of organizing mortgages and organizing mortgage debt is brand new. people have had mortgages and debt and debt on property for centuries. the system that we interact with is a brand new phenomena coming out of the early 1980's deregulation. the left-most point at 1980 and the right-most is that 20 cents.

it has pretty much taken over -- 2010. it has pretty much taken over the market. we're finding that this is failing. why is it failing? this is complicated. dan thomasson of the national consumer law center has this documented. these are the various elements of the servicers. the servicers are the ones who are supposed to manage passively, taking in money from the homeowners and putting it out to mortgage-backed securities. when things go wrong, it is their job to manage it. we see so much of this structural -- so much of these structural factors. we see the personal and institutional incentives pushing towards foreclosure and the speeding up of foreclosure. it is very complicated. we can talk about it later, but that is the background. if you have a system that is

brand new, being tested, failing, the default mode is to force people in the foreclosure, even when negotiations could be done. when i say servicers, these are people with agency and institutions and political clout -- bankamerica, wells fargo, j.p. morgan, people who have been through stress tests and t.a.r.p. -- it is a fairly- concentrated market. why should you care? this is homes underwater versus the unemployment rate -- perfect correlation. this is also the same chart it was foreclosures versus the unemployment rate. there is a lot of debate around macro economists -- the imf has done studies. plenty of people are looking at this. something about the persistently high unemployment rate has something to do with our persistently high mortgage debt and foreclosures. consumers have been deleveraging for couple of years now. they are paying off debt and

contracting. the government is spending more and picking up some of the debt. this is not leverage -- what everyone is trying to pay off. the mortgage debt associated with the mortgage and credit bubble have been very keyed into our recession. two years ago, people realize that there were two policy initiatives that could make this run smoother. having something that allows for corrections to defects -- and called mortgage -- something called mortgage cramdown. people across the spectrum called for higher levels of inflation to deal with this overflow of debt. neither of these things have happened. we're disinflating. there is no relief from mortgages and bankruptcy. as such, most of this right down in debt is coming from defaults and foreclosures. foreclosures are lose-lose-lose

events. the homeowner loses its home -- his home, his standing in the community to the community loses. -- is standing in the community. the community loses. in great times of exaggerated foreclosures, it devastated neighborhoods and creates uncertainty about the way the market will ultimately clear. ok. who are some of the players? we will talk about different policy solutions that the government can take on. before we get there, let's talk about where the banks are coming from. one thing that the banks are worried about and should be worried about is that there is no quick legislative fix as far as anyone can tell. there is no with a glint of a weakened t.a.r.p. -- equivalent

of a weekend t.a.r.p. but pretend we are bank lobbyists with 60 senate votes. we do not. if they did, it is not clear what the past to make the problem go away. it modified bankruptcy code to say that the note is not a problem, but bankruptcy is initiated by the consumer. the uncertainty -- because this is regulated through new york state law, the banks do not have an easy out for themselves. even if they did, it is not likely that congress would vote for something like a t.a.r.p. ii. richard shelby, and noted conservative -- a note to conservative, has made it clear that would not be likely. it is also uncertain that the banks understand the extent of the problem. we saw this with the -- people

have been following this. many of the major banks put a short-term mortgage -- off moratorium -- a short-term moratorium on foreclosures in place. it is not clear that they have a sense of the scope and exposure they have. one big problem is that, if these notes were not passed through, you do not have a mortgage-backed security. you have an unsecured debt securities, a bond without mortgages, because it does not have notes. as such, i mentioned the lemon law -- the natural protection is to force the bank to buy back the mortgages at par for 100 cents on the dollar, as opposed to the 20 cents from 30 cents, 40 cents -- 20 cents, 30 cents, up 40 cents it is worth now. investors are trying to

determine what their options are. some have gone ahead with lawsuits. it is tough to tell if this will be a wave and it will happen quickly or slowly. it will lead to be hundreds of billions of dollars were a trickle of $10 billion, $15 billion, per year. it is a huge amount of systemic risk. regulators have been under the assumption that protecting the six largest banks has been crucial to the stability and our economic growth to get us out of this recession. whether or not that is good or bad, they are running at a time. there is column to be a crisis, from their point of view, it is better -- whether or not there is going to be a crisis, from their point of view, it is better to be in front of that. other people will talk about what the attorneys general are doing. the attorneys general are now putting in motion a few things -- criminal charges. it has not been discussed

enough. if crimes were committed, then this just cannot be an issue of civil courts. they're also looking at actual defects in the servicing problem. if payments are being made toward fees first, if the general service operationally is rotten -- if there is a real problem in their through software, through the way they operate -- that means to be applied at the state level. the work of federal preemption and a lot of stuff that happened with the creation of the mortgage-backed securities market has put a lot of attorneys general on the sideline. this was no accident. they are often vocal advocates for consumer and financial projections. we will see them be put back into motion. it will be investigating securitization and servicera. -- servicers. i think that shows the real possibility for change. thank you.

>> thank you, mike. great. i have been a consultant with the center for american press for about 2 1/2 years on housing issues, specifically to do with foreclosure mediation. i will give you an overview of foreclosure mediation as one of the tools which can be very useful to turn a lose-lose-lose proposition into something that could be a win-win-win proposition. i will start at the bottom with mediation. it is a process in which the parties get into a room with hopefully a subject-matter expert who was neutral. that person's job is to understand the issues, but not to go one way or the other. therefore, the basic idea about mediation is, you do not have to settle. we're just asking the parties to come have a discussion. when the parties get into the room, they settle.

we got into trouble with this initially people misunderstood our posture. we sit, if the folks to get into the room to discuss this tend to settle, why don't we tell everyone to do that? we called it mandatory remediation -- mandatory mediation. we have evolved the term to automatic mediation. what we mean more specifically is, if you, the lender, the servicer, initiate a foreclosure, the manager of that foreclosure, whether it be the court or an organization you of hired, sends out a notice to mediate the case and see if there is a good deal. the reason that foreclosure mediation as important as one of the tools that should be involved in revolving -- result in the housing crisis is that is the last-best chance to get a chance -- to resolve these issues. what we mean is, before you lose

your home, before we have to worry about the process from freddie mac, before it all moves into play, let's have you speak. you, the homeowner, have likely gone to a home counselor or a lender and gone through a process that feels like calling your cable company and seeing if you can change your service. you talk to different people every time. they don't know your history. paperwork gets lost. servicers are thin organization. these people built their business onto in high volumes at low overhead with very little contact with users. they have said, over the last couple of years, they have not been able to hire enough people to handle a modification requests that have come down the pike. the reason -- this looks a lot like mike's slide. the reason mediation is successful is because as a win- win-win. homeowners want to find a way to

keep their home. lenders have a fiduciary responsibility to maximize the total value of the pool of mortgages they hold. a modification, a deed in lieu of foreclosure would maximize the value. that will be the deal they do appear more often than not, even with limits in their servicing agreements, they are able to do that. lastly, when we go as advocates to the local government and they say, wire we getting involved, what is in it for us -- why are we getting involved, what is in it for us, they see that their tax base is eroding. they want to make sure they benefit. they also want to lower their expenditures. when you have light, additional public service is necessary -- blight, additional public services necessary to -- they will benefit from this mediation. hamp is a paper-driven process.

the lender makes a determination and send it back to you. if you sit in a room with somebody at the end of the process -- i mentioned the second-look process, for three months down the line from six months down the line, a select number of cases. even if they pull yours, you lost your home, you're not getting it back. if you go ahead of time, you have a chance to have a conversation about your situation and see if the assumptions about your income and appraisal are correct or not. perhaps you are eligible for proprietary mod. lastly, you have the ability to find a process that probably inject certainty back into the process. the certainty that was shaken by the multi-state electronic registration system, the road- -- robo-signing process -- these have shaken public trust on whether the person across from the table has the right to foreclose.

and mediator -- the media sits there and sees if they have dogged their eyes and prosperity's -- a mediator sits there to see if they have adopted th -- have dotted their i's and crossed their t's. in amateur mediation program, we see a 74% -- in an amateur -- in a mature mediation program, we see a 74% settlement rate. there are other ways in which a homeowner can leave the home with greater control and participation in the process and get a greater value for the lenders and investors and shareholders. we're also learning that mediation takes more than one session.

homeowners do not have all their paperwork or the servicer or lender needs to go back and get authorization, and so on and so forth. those mediation sessions take 90, 100, 110 days, but they tend to run in parallel with the foreclosure process. the foreclosure process begins and starts to run its course whether it is awaiting period or is every or so on. in the meantime, mediation begins. mediation reaches a settlement, both cease, and that tends to be a much shorter program -- process. this is an example of the data we're getting out of states like connecticut. this is from january. they stayed fairly consistent. you can see -- there is a pointer. 26% of participants did not settle. 14% engaged in a graceful exit. 60% managed to stay in their homes. connecticut is an interesting

test case. it shows something that we found fascinating. if you create an opt-in mediation program, sending them paper were -- paperwork, those offers include a box that you can check if you would like mediation and give you the opportunity to check paperwork and show up for mediation. that leads to a maximum partitioned nation rate of 20%, -- participation rate of 20%, 1 in 5. in the automatic system, we get 80% participation. what we worry about is, when you grant that up, maybe the people opting-in were self-selected, the people who were the best would go and get modifications. that turned out not to be the case as shown by conn.

connecticut went from the opt-in to the automatic program. they got $3 million and they have shown that, previously, 80% -- excuse me -- previously, 80% people just were not participating at all. and the wrong number, 12% of homeowners were keeping -- in their raw -- in the raw number, 12% of homeowners were keeping their homes. the only difference is whether you opt in or opt out. new america foundation is the right place to be talking about this. they have leveraged be liberal economics to their advantage. that is what conn is doing -- they have leveraged behavioral economics to their advantage. that is what connect it -- connecticut is doing. when we look at this in 2009, 11

jurisdictions had programs. it is a master -- there is an asterisk because some of them did not have programs. now, there are 22 states and the district of. -- district of columbia. there are quite a few judicial and aerosol nonjudicial foreclosures -- and there are also nonjudicial foreclosure is. we can simply assign this to a trustee and never see the courthouse. in the majority of states have nonjudicial foreclosures -- the majority of states have nonjudicial foreclosure is. judicial foreclosure states have a fiduciary that does not need to go to the legislature and say, we want to create a program. they have discretion to divert programs into alternative-

dispute resolution modes. they have been doing it for years with family law. havedelphia, florida both done that. if you need money or you are in a nonjudicial foreclosure state, you have to go to the legislature and the preparation, get past, have public stakeholders -- go to the legislation -- legislature and get it passed then have public stakeholders. california accounts for 20% of foreclosures in the country and sorely need a program like this. published extensively on state best practices -- we have published extensively on the best practices. we can show you the steps to take. we have reported on the successes and shortcomings of efforts around the country. most recently, the center for mayor and progress has published a memo on presidential power. -- the center for american

progress has published a memo on presidential power. we have been working on this for awhile. the vice-president -- the middle-class task force came out with an announcement that said the community development block grant funds can be used to fund housing counselors supporting foreclosure mediation. it sounds minor, but they are linchpin. they are the subject-matter expert who can come to the homeowner and help them through the process. that was a very important piece. congress has been unsuccessful, and is likely to continue to be unsuccessful, to help fund programs at the state level or to simply direct -- this is the group at the bottom of the page -- fha or average a fait -- or fhfa to do something they can already do. if your service and a

government-guaranteed, government-owned, -- if you are servicing a government- guaranteed, burnt-owned long, -- government-owned loan, you must first immediate. you have to mediate. they have exercise that power. our message to them is, why don't you do that everywhere, in california, utah, arizona? we would have a national system whereby every case -- not every case -- but a large chunk of cases would be going to mediation. thank you. i will pass it on to the next speaker. >> hi. thanks for having me here today. to have a working on this for several years spirit it is exciting to have an audience -- i have been working on this for several years. it is exciting to have an

audience. these are important issues to millions of homeowners who find themselves in trouble and to find themselves potentially ground-up by a system that they never understood and they had no hand in making. i want to start by just bring up a topic and have not discussed much publicly. something tim said shocked me. in his opening remarks, he mentioned some of the problems in mortgage servicing duties and, of course, we have heard these anecdotal reports from legal aid lawyers. when legal aid lawyers handle thousands of cases, caesar and problems over and over again, why is that anecdotal -- see certain problems over and over again, why is that anecdotal? when investors or regulators finally look at something and they report the same problem, those are somehow not anecdotal. the reason i bring this up is

that the industry has been going down this road for a long time. these are not problems that suddenly just sprang up that we did not know about. and i think one lesson we can learn for next time -- because everyone is always looking for lessons out of these kind of debacles -- is listen to the people closest to the ground. there are a lot of good, early- warning systems. the legal aid lawyers tended be one of them. they see the homeowners. they go through the paper is very carefully. they understood what was going on with the servicing system long before anybody else did. speaking of the servicing system, this whole question of was the note properly endorsed, what is happening with the title, were there boiler rooms full of people who were just robo-signing -- these are big

problems, but they are emblematic of the system. in many cases, the attention that has been drawn to them is because they are so dramatic, and it has taken the focus off of the major problem -- in many cases, services are not keeping proper accounts for their customers or, in some cases, they are actively engaged in practices that will make it more likely for their customers to default on their home loans. ij -- in any exploration of the problem and its solutions, we have to look all the way back to the servicing process, from the very beginning. how are the different payments accounted for? if a person is late, how are the late fees handled? when they pay their account, in what order are those payments applied? does the servicer first pay the

mortgage or is it -- to the first pay themselves for any late fees? is the servicer improperly placing insurance on these loans when either the homeowner already has insurance or if the homeowner does not, are they buying them insurance at wobbly- inflated rates because of a less than arm's length relationship with the insurer? these are problems that have been endemic throughout the system for a long time. in many cases, they result in a homeowner going into default, not because they were not able to cover their basic mortgage payment, but because something happened in the servicing system that then spiraled out of control and ended up causing their defaults, as opposed to, in many cases, simply exacerbating their defaults. the next topic i want to touch

on is the fact that we saw the housing bubble inflated. we have now seen it deflate. consequently, there are great economic losses. nobody debates that there are losses. the only question is, who was bearing the brunt of these losses? so far, spending the last four years failing to take on the program -- problem in any effective way, we the people have borne the brunt of these losses. homeowners, communities, particularly minority communities, and anyone who lives anywhere near foreclosure or in a house they own, has borne the brunt of these losses, as opposed to banks, or in some cases, investors. investors have seen losses, to o. the banks have been treated very gently for the most part, and

protected at a level that a homeowner can only dream that someday their government would protect them at. i want to talk about some solutions. i am not promising to talk about only the solutions that are the most politically- feasible. instead, i'm going to talk about what i think is really going to work. some of them are very feasible right now. some of them need to happen anyway. first, in terms of servicing, if nothing else has become clear lately, it has become quite clear to everyone -- i think no one will argue with this -- that one of the basic functions of the servicer is not being accomplished correctly, which is to sort out those foreclosures that should be avoided because it is in everybody's economic best interest.

there are those foreclosures that are on early on avoidable. someone has no income, something catastrophic has happened. the system is not properly sorting those. as a result, we have a lot of what i call unnecessary foreclosures. in some cases, the homeowners are not even in the -- in default or the default was servicer-caused. in other cases, the homeowner is in default, but everybody would benefit from a loan modification of some kind. we need to get the system right. one of the most important ways to do that is to end what has been a system of parallel processing, loss mitigation, and foreclosures. once your loan is in trouble, the computer systems in one part of the servicing organization -- sometimes it is different subcontractors involved.

the computer starts sending you a variety of letters at different times, telling you how much trouble you are in at any given moment. at the same time as the right hand is doing that, the left in somey be engaging loss mitigation, how to do a loan modification, how the foreclosure can be avoided. problem is the right and left hands are not talking to each other. in many cases, they're prohibited by the contracts themselves from talking to each other. that has been pretty much a recipe for disaster. the homeowner is on the phone with the servicer. they think they're working out a deal. they get this very lethal- looking piece of paper in the mailbox talking about for closure or setting up a sale date or something like that. they naturally assume that their efforts to work out their deal have not worked and they proceed

accordingly. this happens all the time. this is insane. people have been referring to this as dual-track processing. one really effective way we can make mortgage servicing work better right now is to stop this dual-track. we need to do so in two ways. one way is already required by hamp. a servicer should not be able to initiate foreclosure proceedings until a person has been reviewed for some kind of loan modification or loss-mitigation solution. reality being what it is, many homeowners do not actually contacted their servicer until they have gone into the foreclosure process -- do not actually contact their service sir until they have actually gone into foreclosure process.

the foreclosure proceedings should be suspended until the review is complete. this is an automated review. it should not take that long. in a world of foreclosures taking a year-and-a-half, it is really not going to move the dial one way or another, but it would make the sorting process more effective. one other thing i want to talk about -- because i am running out of time -- this is the solution that may be on the more difficult, political and -- unfortunately, there is just no substitute -- changing the bankruptcy code to permit bankruptcy judges to modify mortgages on principal residences. that is practically the only debt that bankruptcy judges cannot modify right now. bankruptcy is america's system for handling debt that has gone bad. we have the system for reason. that is complicated.

restructuring debt is complicated. the bankruptcy system was permitted to handle all of the most difficult questions that come up in the lost- mitigation -- lost-mitigation programs. we could handle more of this in the bankruptcy problem in handle the problem of concern about whether different rac -- tranches of investors will be happy or unhappy with outcome s. would have a disinterested third party available to oversee the process. we have been dancing around this issue for four years now. every other solution that ec put forward is an -- that you see put forward is an effort to put this -- create a system in a

different way. i say we use a system that was actually intended for this. last point i want to make is that, it is true that the government's loan-modification program has been a serious disappointment. it has not achieved what we had hoped for a variety of reasons, the most important being that it has been voluntary. the banks have been treated with kid gloves. we have no other program right now. having hamp is an important tool right now. i do not think we want to see the government dismantle hamp at this crucial moment. what we want to do is fix some of its flaws and put some other solutions in place as a backstop for borrowers so that we can get this right, stop the bleeding, and help turn the situation around. thank you so much.

them a good afternoon. -- >> could afternoon -- good afternoon. i am policy director for afl- cio. i am required to say that my remarks are my own. they are not the opinion of the congressional oversight panel as a body, its staff, or chair, senator ted kaufman. these remarks are mine. i will talk about the work of the panel. i have been asked to address systemic issues raised by the presentations you a just heard. let me begin by saying that the oversight panel has done regular reports on the mortgage crisis, dating back to our third or fourth report in march of 20009 -- 2009.

our most recent report was issued a week ago. it really looks at camp -- hamp and the other programs under t.a.r.p. for mitigating and preventing foreclosures. perhaps with the greatest owens is our report -- greatest relevance is our november, 2010 report which look directly at the rear of irregularities in the residential mortgage market -- at the irregularities in the residential mortgage market. we're the oversight panel for t.a.r.p. there are two dimensions of the purposes for which congress enacted the emergency economic stigmatization -- stabilization statute of 2008, t.a.r.p., known to many as the bank bailout. it was to repair our financial

system and to address the foreclosure crisis. we have looked at the irregularities from both of those lands -- lens. i have both reports with me. they are very long. this is a two-sided copy, so you can imagine how long it is. they are both available on our website -- www.cop.senate.gov. we have held numerous hearings on the foreclosure crisis, including one at the end of october. the head of hamp testified. julia also testified at that hearing. held a hearing in 2009 in philadelphia on the foreclosure

crisis where we focused on the mediation programs. we spent a lot of time with judge rizzo. our oversight panel has consistently recommended that the new term "automatic mediation" be a feature of federal policy innovation in the way of foreclosures. it is quite a mystery, given the data that we have seen, and what our panel has witnessed firsthand as we observed mediation in the philadelphia court's led by judge rizzo -- it is a mystery why this has not happened. it is good to see it some steps are being taken. i'm going to talk about 6 the request -- systemic risk. what is it? it has become a term -- people

google things like this. you can see how often it has been looked up. i'm sure if you ran "systemic- risk council " you would see that, in 2007, it became as popular as maryland row -- marilyn monroe. what is "systemic risk"? you cannot understand irregularities unless you understand what we're talking about. systemic risk is the notion that there is the possibility of defense that would -- of events that would destabilize our financial system as a whole and the economy as a whole. this is not the risk that one particular firm might fail, as painful as that might be for the people who were invested in it or worked for the firm, but the notion that, what is the possibility of their risk of

contagion in the financial system? historically, looking back to the great depression, there is a lot of talk about systemic risk as a domino effect, and one firm fails, it cannot meet its obligations to others, those firms faile. in 2008, we saw another type of systemic risk. comes from a sort of collapse of confidence in the financial system, both as people learn things and as participants learn what they do not know. when doubt comes into play as to whether or not major financial institutions have the short-term funding -- when doubt arise, you can have a system in crisis even though there is not a default

leading to other defaults. what does this have to do with what we have learned about? what i am talking about is systemic risk, not the certainty of systemic crisis. it is about probability. there is no way to look at what you just heard about and not conclude -- i think this is a fair reading of our reports -- and not conclude that there is systemic risk. why? we have, today, a quite concentrated banking system compared to what most of us got our banking system was or what it was when we were all growing up. 62% of assets of u.s. bank holding companies are held by four firms -- bank of america, jp morgan chase, citigroup, and wells fargo. that is a very high level of concentration, historically. it is married by those firms --

irrored by those firms' participation in the mortgage market. they originated 57% of all mortgages during the bubble, particularly 2005-2007. how much money are we talking about? those who got to firm's service mortgages with principal amount of close to $6 trillion -- those four firms service mortgages with principal amounts of close to $6 trillion. one of the things about financial policy is that the numbers involved tend to be kind of mind-numbing. how much is $6 trillion? the total tier-one regulatory capital, one of the key measures of the solvency of banks, the total of those four institutions

is $500.30 -- $535 billion, approximately 1/10 of the principal of the mortgages they originated and service. what does that mean? is it big or little? what are the implications? long before you get the zero regulatory capital, a bank will be destabilized. these large, integrated, universal banks that do not just depend on insured deposits, but on a variety of short-term funding mechanisms -- long before you get the zero regulatory capital, you will have solvency problems. those institutions are each undoubtedly systemically significant. if anyone of them were to be destabilized, it would create a domino effect and doubt about the viability of other institutions -- doubts that

could not easily be answered. in addition, as i think you learn from the other presenters and you will find from our report, the nature of the irregularities in the mortgage market -- it is hard to figure out what is going on. it is hard to figure out what the facts are. it is hard to determine what the legal meaning of the facts are, given that the legal meaning is subject to certain proceedings in all 50 states, and potentially different proceedings within different counties. it could lead someone to conclude, i do not know what is going on with this firm and these irregularities, and therefore i am pulling my money. this issue of uncertainty layers on top of that and exacerbates it. that type of uncertainty with respect to the mortgage crisis was critical to the way in

which the financial crisis of 2008 evolved. you have both the hard numbers and you have the risk that financial market participants could conclude that we a to many unknown unknowns -- have too many unknown unknowns. i want to explain why i believe that this is an issue of systemic risk. there are different measures of capital for banks. it will shift from tier-one to market capitalization. if you could somehow figure out how to do this without triggering a run-up in stock prices, you could buy bank of america for about $120 billion. that is about what the stock is worth, all of it.

that is roughly what the market -- that is what the markets think the equity is worth. if bank of america starts taking losses, you would start subtracting from that now you. -- value. bank of america is the biggest of the servicing banks with about 20% of the market that i have described. it is close to $2 trillion in terms of both originated and serviced securities. the federal reserve bank of new york and a group of other bond investors have begun the process of trying to force bank of america to buy back from them mortgages that bankamerica has securitized and they have bought the securitization. they're looking for $47 billion.

the bondholders believe that that $47 billion pool, as a whole, is worth, on the market today, about half of its face value. take all of those mortgages, tens of thousands, all $47 billion worth, nominally, and force bank of america to buy them back -- bank of america takes an instant 50% loss, and $23 billion on the transaction. which mortgages will they put back? it is likely to be the bad ones. how many of those transactions -- how many such putbacks could bankamerica absorb?

maybe $100 billion? maybe $50 billion? maybe a lot more, maybe a lot less. how many putbacks will vested be able to force on bankamerica? it is not clear -- will investors be able to force on bank of america? it is not clear. just taking that one block of bonds, which the bondholders view as not remarkable, it does not take many multiples to get to a very big capital problem. bank of america has $2 trillion in originated and serviced loans. that is why there is an issue of systemic risk. how big is the issue? what is the person is that these could produce a systemic crisis across the system -- the percentage that these could

produce a system in crisis? we were unable to assign a percentage likelihood. we have hundreds of pages explaining this. we concluded that the risk is there. i have two more things to say, two thoughts. the first thought is, it has been troubling to me and to our panel that it is difficult for the bodies assigned to manage and prevent a global systemic risk, particularly the bodies created by the dog-franc -- dodd-frank act, to speak candidly about this. we have built a structure to try to prevent systemic risk from escalating. we have empower them to take actions to restrain financial market participants -- empowered them to take actions

to restrain financial market participants from taking on systemic risk practices. when faced with a very clear matter that puts these issues in play, the regulators are afraid to say the words. it makes you wonder how the system is going to function. how can we manage risk we cannot admit we have? second and final point -- as several of the other speakers have mentioned, irregularities and that the only source of systemic risk. it may be true that irregularities are not a source of systemic risk. but if they are not, here is what is -- 200,000-plus foreclosures every month, as part as the eye can see. why is that a systemic risk? a, because it will eventually

force the right-down of assets currently being carried on assumptions -- by banks on assumptions that housing prices are going to rise, not going to rise until the extraordinary levels of of foreclosures stop. secondly, it is a systemic risk because of -- because of what it does to the financial some -- not because of what it does to the financial system, but to the country. in certain respects, to the confidence of our citizenry in of our legal an systems. there are systemic risks that everybody is arguing about, and there are ones that no one is really arguing about but equally real, and in some ways more clearly evident and unavoidable. the challenge -- the notion that tarp has been a success is

a hotly debated one in washington. our panel, i think, on a bipartisan basis, has taken the view that tarp was a fairly successful program in dealing with a very acute crisis in 2008 and stopping at panic, but much less successful in its purposes of leaving us with a healthy financial system or addressing the mortgage crisis. those two things appear to be deeply intertwined. that issue of the long-term health of our financial system and economy is turning out to have quite a bit of lbite. it is long overdue that more aggressive and focused actions be taken. actions are on mediation are part of those, but the part of this that we have to place is that the losses are real, very large and very real, and as long as there is an effort to make -- to pretend that they don't exist, the more paralysis we're

going to have put in our economy and housing system. there may not be any real way of dealing with these issues fundamentally without dealing with the fact that one way or another, there have to be consequences for financial institutions for the mistakes they made. whether or not those mistakes include massive abuse of the legal system is a question we will have to wait on, but there is no question that those mistakes gave rise to trillions of dollars of losses in our economy, which we are paying for and continue to. thank you. >> thanks to our four panelists for talking about their perspectives on this. we are going to have a brief panel discussion before we open it up to audience questions. i wanted to start -- we had a few references to the dodd- frank financial reform bill, i

want attack -- and i want to talk from a regulatory perspective, who is going to be in charge of monitoring the services under this regulatory regime, and what are the first steps they should be taken to address these problems going forward? anyone can come in with their opinion -- can jump in with their opinion. >> right now the servicers are not regulated cross-servicers. they are if they are part of a commercial bank, which many of them are. but "mother jones" and others have written about this, that there is no regulatory actions against servicers for years. it will move to the cfpb. the fcc is looking upon -- the sec is looking at rule- writing for the securitization process.

people at the roosevelt institute where i work are signers on it. as we see these put-back issues, that will be really relevant. >> it definitely falls to the cfpb the new consumer financial protection agency, to write industrywide rules for services to abide by, and we believe that that should be very high on the priority list when the agency comes on line in july. july is not very far away. it is a good time to start looking at this right now. there is a joint making going on with respect to the mortgage risk retention set up by the dodd-frank pact we are in.

securitized is of mortgages have to hold an amount of risk, and there is a broadbased effort right now to put some servicing standards into that system. they are needed industry-wide, but in particular, we know that servicing securitized loans carries a variety of difficulties, even more so than servicing portfolio loans. the robust oversight of servicers is long overdue and should certainly be on the agenda of any regulator that touches the system in any way, including the prudential regulators. >> just bought a fine a point on what people have just said, -- just to put a final point on what people just said, there are at least three distinct regulatory jurisdictions over servicing.

when is the consumer jurisdiction the julie just mentioned, cfpb. the second is the sec, which is really focused on investors, both in stocks and bonds of the banks themselves, the servicers, but also investors in publicly traded mortgage-backed securities the servicer services. the third and most important least focused on other bank regulators, whose purpose the fdic, occ, and the federal reserve, each of whom have jurisdiction over large servicing companies -- their purpose is the solvency of those institutions. they have a variety of risk- based capital requirements. these issues clearly in a time it down. one of the most salient issues

is gone to come up very fast your -- is going to come up very fast here, that the federal reserve is going to run stress test on a bank and the results are not going to be public, but it seems clear that they will look at mortgage irregularities as a contributing data points to the test. >> i want to ask a bigger picture question as well. mike showed the graph that demonstrated this is a relatively new model for housing finance, not living up to its first test. in the next year, congress is expected to take up gse reform, looking at fannie mae and freddie mac. is this a model that can continue, securitization of mortgages, with all this inherited -- with all the risks inherited? but should we look at next year -- what should we look at next year with the jesse processes under which this originated?

-- the gse processes on which this originated? >> i am going to answer this bite for submitting that i will answer this sideways, which is to say that i am not going to hit 800 i -- not going to hit it head on. if you believe in what the gses were set up to do, promote homeownership, keep them in a modified version of what they are today. if you believe they are an improper methods by which you want to do this, you should get rid of them. right now they have been a punching bag, and they have not done everything correctly, but by and large, most of the time they are being faulted for that which they are set up to do. if you are going to attack them as to their fundamental purpose, let's do that and be honest about it. the other suggestions that are

coming to the fore here are what we do instead of the gse? some say to forget about government subsidy of mortgage finance. let's just go private mortgage rates. my colleague did some work on going back and saying, well, let's look what was being done when we get purely private mortgage finance, and let's look at the rate of homeownership, and their rights which people were paying and the rate at which people were able to buy homes. when we take a hard look at this and our own expectations of participating in the economy as consumers and homeowners, we all like that world trade we come down on a -- we don't like that world let's move them in a direction that we like, but not debora them all together. i just addressed the question -- let's not get rid of them all together. i just addressed the question

sideways. >> there are a number of ironic things about the discussion about gse's. the first is you might think that there is evidence that gses caused the mortgage crisis. actually, the evidence suggests that they were a secondary afctor. doesn't just suggest it, it pretty much proved it definitively. the subprime bubble got going in private, non-gse-supported markets. privatizedh had been and his executives had the types of incentives doctors for themselves that other private financial -- incentive structures for themselves and other private financial chased thes thahad, private lenders. you see the private lending in subprime in 2003 and 2004, and

gse's come in in two dozen for property may -- fannie mae and then for freddie mac. secondly -- that does not mean the gse's are not callable for this. the bank of the themselves. but it is not true that this was caused by the gse's. existed, gse's have since the new deal, and we only had this situation in the mortgage markets in the last five-seven years. does this tell us that there is something fundamentally problematic about a financial institution intermediating risk for mortgages? no, it tells us there is something fundamentally problematic about having these institutions compensate executives on short-term performance metrics and having them play catch-up to a completely unregulated private

system. now, the conclusion to those points -- so than here is the other thing -- the whole narrative about gses that is out there about them being a central cause, not secondary, but central, simply has no factual support. second, there is a great political irony here. the major wall street institutions spent a lot of money over the last 20 years attacking gses, with committees and lobbyists doing that. plenty to attack them for. i am not suggesting they're blameless in all desperate to spend a lot of time attacking all the -- i am not suggesting they are blameless in all of this. but they spent a lot of time attacking them. when the crisis happened, those who had bought into market fundamentalism and were looking for an explanation that did not slip their own throats, they happened upon the gses, and they

thought that that would be something that the banks would like to support financially, that explanation. ironically, what then happened is that the investors walked completely away from private- issued mortgage-backed securities. starting in the winter of 2009, and it is still true today, private financial institutions cannot securitized mortgages without gses. as a result, there was no longer any appetite on the part of the major banks for dismantling the gses. we are now in this funny sort of context in which the rhetoric and ideology, power politics, are at cross purposes with each other. >> one way to think about the gses goes back to securitization to get the securitization market comes from the gses, and the whole definition of subprime loans is that which gses would not touch. it lot of the 1980's was the

removing of state laws that interfere with private securitization. it turns out that if you stop them full of really bad loans, you are going to have bad outcomes. gses exist in part to put in prime loans and stamp them as being prime. that is how that comes about. the question is, it does not seem like that can exist on its own. every industrialized country has some sort of mechanism to regulate, and it seems like historically, housing would not be a good way to building any type of equity without some sort of government backstop. it looked a lot more like a bullet loan. the question is do we want to build equity through home ownership in the future? >> i want to bring it back to the servicing issues we have been discussing today. i think my colleagues here have

covered the basics on the gse question well, which is that no matter what kind of housing finance system we have, what we have learned from this crisis is that we need to do a much better job of understanding how the incentives doctors work, and in what places there are incentives that cause us to be pricing was incorrectly -- pricing risk incorrectly. part of the housing crisis came because we took a system of mortgage lending, where it had been in the bank's interest to locate borrowers who were capable of paying mortgage back, and turned into a system where independent mortgage brokers paid at the closing table and we're originating lenders -- where originating lenders hold

loans out in a matter of weeks. as you saw from mike's chart, there was a long process designed to strip out every bit of liability. there were very few incentives there for good mortgages to be made. now what we are learning about is the other side of that, how the mortgage servicing end had all of these incentives built in that do not aim towards the maximization of the best interests of either the investors or the homeowner, but in many cases just the servicer, the entity that is actually doing the work there, and that is where we need real oversight, real transparency. particularly, i would suggest that we pay particular attention to anything we do that, say, purports to throw

away a land titles system that has been there for thousands of years. when you are doing something like that, it needs to be done without serious thought and attention -- with serious thought and attention. >> one of the topics of interest the people have not talked about is the second main problem. >> well, a number of us here to talk about it -- can talk about it. estimates differ, but probably about half of all mortgages in trouble have an additional lean on them -- lien on them, either an additional mortgage or a home equity line of credit. many of those second liens were piggyback loans, taken out simultaneously at the time of the elimination to avoid requirements for mortgage insurance. some of them. typical home equity lines of credit that you get later --

some of them are just your typical home-equity lines of credits that you get later. most of these liens are held in portfolios of a large banks that might and damon had been talking about. you recall that those are the same banks that owned the servicers that serve as the majority of the mortgage loans out there. you might think, is in that conflict of interest? it turns out, yes, it is a conflict of interest. exactly how the conflict works bibbers depending on who you ask -- differs depending on who you ask, but in a mortgage that is supposed to have priority -- that is why they call it a fresh clean -- doesn't particularly want to see their lien impaired when a second lien on the mortgage, something that is supposed to be jr. and take any hits first, when that is remaining uninsured, that is a

major obstacle to everything we tried to do from the government's point of view to sell the foreclosure problem -- solve the foreclosure problem, ranging from basic loan modification efforts to any kind of program designed to reduce principle or worse already in default -- for borrowers already in default, as well as where they need to exit the launown. t -- laon. the second and in some cases third liens gum up the works, and that is where some of the most, shall we say, optimistic account is going on, where the banks hold these second liens on

the books at their original value in the hope that, well, if we just stick it out, these prices will go back up and we will not have to take at large mark down. in the case of second liens, they have been a big problem. in a sense, they have been a central problem to address in this issue. it's an interesting situation where policy is being driven by accounting rules. >> we are running out of time a little bit. just briefly, for you all the say in one or two sentences what the top priorities should be for policymakers in the next six months to deal with this problem, and then we will take just a few questions from the audience. >> i will suggest any specific policy except that cramdown takes care of pretty much all of these problems, including second lien and everything else.

one thing we don't have a handle on this particular for costs to municipalities -- doesn't foreclosure costs in the disabilities thousands of dollars. in the cases where they are shutting down schools and not fixing roads and cutting power and salaries, they are going to pay largest banks for foreclosures. that is an abomination. >> from the beginning i have had a qualification regarding for cloture mediation, a meeting from the get out that this is a piece of the solution -- from the get go that this is a piece of the solution, not the entirety. if you are going to spend a relatively modest sum well, spend it on mediation. we're talking before the cfpb gets going and then the rule making. a year and half out before the rubber meets the road. foreclosure mediation is calling in many of these cases, and federal support is the last best

chance for someone who is losing his house in a month or to do two months to save it and get credit control over the process -- get greater control over the process. i'm dealing in assets in realpolitik here, but if you were able to get matching funds, you should be able to fund 50% of a program in every major metropolitan area in the country. i don't believe that is getting done in the next six months, but that is the level of funding we are talking about. $800 million, in the scope of the discussion we're having -- i'm not even going to say to nomination for the rest of the conversation, billions and billions. >> for a long list of potential solutions, i would refer you to testimony i have given recently before the congressional oversight panel and the house

financial services committee, online at responsiblelending.org. we know we need, which is that in order to get this right, any program that we put out needs to be mandatory, and needs to be industry-wide, and needs to give the home under some level of control -- homeowner some local control, so that the decisions are not being entirely made by the servicer without having a home water -- without the homeowner having the right to appeal. when the the best ways to make a very small -- amount of money -- one of the best ways to have a small amount of money and go very far is to find legal aid attorneys. there is an enormous multiplier effect of that money on just a few million a year. these are the attorneys who have brought you all the information about robo-signing, title

problems, and are doing in a bit of lawsuits in courts right now. they work for their clients for free and practically work for free themselves, and in some cases actually work for free themselves. there was money out the rise in the dodd-frank act for these attorneys but it was not appropriate -- authorized in the dodd-frank act for these attorneys but it was not appropriated and looks like it will not be good i would strongly suggest that legal aid lawyers be part of the mix. >> i think that if you look to the policy notions that have been on the table this afternoon, they are all about different routes to principal modification, to writing loans so that people can stay in homes. i think there ought to be a policy goal associated with this, which is to get the foreclosure rate to a level where it is not exerting

meaningful downward pressure on housing prices for all americans. in order to get policies and a place that do that, -- in place that do that, with the -- we have to stop it being confused about basic facts on the foreclosure crisis. first is, there ought not to be any confusion on the part of any policy maker that foreclosures are bad. they are bad for the economy come up with the citizenry generally, bad for the country -- bad for the economy come up with the citizenry generally, and for the country. it is a serious source of financial and economic systemic risk. >> i think we have time for two questions. we have a microphone and i will ask that everybody can identify themselves, and please raise your question as a question and quickly, please. a gentleman with the blues leave right there. -- blue sleeve right there.

[inaudible] >> leadership in the senate and house to embrace your suggestions, given the best practices so far? >> i think that there have been built in the senate and house that have gone -- bills in the senate and house that have gone to committee and stayed in committee. both bodies are busy with higher-priority issues. this is selling at states are already taking care of or could be take -- something that states are already taking care of or could be taking care of. it does not resonate, and the concern is that -- to be perfectly blunt here, if you raise your heads above the weeds here, it will be topping off -- . it wi -- it will be chopped off.

we bring up a federal legislation and people say, "contracts clause." no, it is particularly not the case. and so on and so forth. there are talking point objections that are not true objections. with the new leadership coming into the house, i think the position of the mortgage bankers association and bankers in general is going to be such that it will be difficult, given the state by state objection to this, for it to pass. the states, including those in philadelphia and connecticut and maryland, while they have objected when the process has started, once it is up and running and foreclosure mediation is ongoing, as stakeholders in the creation of

it, they have often times embraced it, seeing that accretes for them -- it creates for them as active participants and the press is. -- in the process. i think the description that a former colleague of mine likes to use is the octopus. when you have an organization this large, what one part is doing and another part is doing are unrelated. these people sit in different geographic locations and they don't know each other. there is a dislocation t between people acting in tennessee who are opposed to people in florida who are for it because they've seen it on the ground. >> please identify yourself and keep it brief, a question. >> do any of you had statistical or at information on incidents

regarding foreclosure distortions were not -- mediation -- foreclosure situations where no mediation has taken place >>? the way our research is done is systematic and anecdotal in we go and have conversations. i believe i have seen one media report in which there was an altercation. i believe it was related to foreclosure, not foreclosure mediation. i have not heard of any instances in the people i've spoken to in any program -- if one is to see the least contentious system one could imagine, where a homeowner is under tremendous stress, and so is the services council, that person oftentimes as 100, to water, 300 cases they are 200, 200ith -- 100, cases they're dealing with and there is tremendous pressure to get it done. when you bring into formal

contacts with mediation, the process is meant to alleviate this sentence. they tend to be very amicable. >> the only thing i know in that vein are suicides. >> well, on that note, let's hope it doesn't come thao that. thank you all for joining us today, and have a lovely holiday. >> the associated press reports that senate democrats and republicans have reached a deal on a new aid package for september 11 emergency responders and their survivors. it calls for up to $4 billion for health care and economic aid over five years for responders who became sick from having worked in the dust of the world trade center. the house and senate have been waiting for the agreements so that they can vote on the measures today. president barack obama has signed a stopgap spending bill into law, keeping the federal

government open for early next year. it freezes agency budgets at current levels. republicans will have to come up with federal spending for the remainder of the budget year when they get control the house next month. the president has also signed the law of repealing the don't ask don't tell policy on gays and the military. before it goes into effect, service chiefs have to complete implementation plans and certify that will not damage combat readiness. the house came in this morning, and recessed shortly after passing the defense authorization bill. it sets policy for the next year and includes a military pay raise. it goes to the president now. the house is waiting for the senate to send over a bill to pay the 9/11 emergency personnel who responded to the world trade center collapse for health care issues. we will have live coverage when the house returns on c-span.

on c-span2, you can see why it senate debate on the start an treaty with russia. several senators want to amend the treaty, but the russian foreign minister said this week that russia will not accept changes. a final vote for the treaty ratification is expected very soon. >> it should take a constitutional crisis, a terrace -- it should not take a constitutional crisis or a terrorist attack or financial calamity to summon each of us in this body collectively the greatness of which we are capable, nor can america afford to wait. >> as the 111th congress reaches its final days, search for a farewell speeches and hear from retiring senators on the c-span at a video library, with every c-span program since 1987. all on line, all free. it is washington your way. >> on c-span christmas eve,

speaker of the house nancy pelosi and other members of congress like the capitol christmas tree, and president obama and the first family attended the pageant of peace. later, michael dukakis and charles gibson talk about the preparation for a presidential debate and their impact on the campaign could christmas day, british prime minister tony blair and author christopher hitchens on the role of religion, garrison keeler talks about him in public life, -- humor in public life, and former justices sandra day o'connor and david souter. >> the senate has approved health care for 9/11 first responders. the bill will go to the house for their vote. president barack obama has signed into law a repeal of the don't ask don't tell policy on gays in the military.

before the law goes into effect, service chiefs have to complete implementation plans and have to certify that it will not damage, readiness, and draft guidelines to respond to practical questions like how to handle sexual orientation in making direct assignments -- barracks assignments. [applause] >> a real good day. as my colleagues can tell you, this is a long time in coming, but i am happy is here. ladies and gentlemen, welcome. please be seated. it was a great five-star general, dwight d. eisenhower, who once said, "the force can protect an emergency, only justice, fairness, and consideration and cooperation can finally meet a man to the dawn of eternal peace." by repealing don't ask don't

tell today, we take a big step towards fostering justice, a fairness, and consideration, and real cooperation that president eisenhower spoke up. this fulfills an important campaign promise the president and i made and many here on this stage may in many of you have fought for for a long time, repealing a policy that weakens our national security, diminishes our ability to have a military readiness, and violates the fundamental american principle of fairness and equality. that exact same set of that brave gay men and women will be able to defend openly around the world. [applause]

it is -- it is both morally and militarily simply the right thing to do. it is particularly important that this result is fully supported by those within the military who are charged with implementing it. i want to pay particular respect, on a personal note -- i use to be a lot to say in the senate, on a point of personal privilege -- admiral mullen, you are a standup guy. [applause]

he already has enough power, don't -- [laughter] it could not have been done without these men and women leading our military, and certainly cannot have been done without a steady, dedicated, persistent leadership of the united states -- persistent leadership of the president of the united states. [applause] mr. president, by signing this bill, you will be linking military might with an abiding

sense of justice, you will be protecting our by promoting fairness -- projecting power by promoting fairness and making the united states military as strong as it can be a time we needed to be strongest. ladies and gentlemen, the president of the united states of america, the commander-in- chief, barack obama. [applause] >> yes, we can.

yes, we can. >> thank you. yes, we did. >> thank you, mr. president. >> you're welcome. this is a good day. >> yes, it is. [unintelligible] [laughter] thank you, thank you. .ou know, i'm just overwhelmed this is a very good day. [applause] i want to thank all of you. especially the people on this stage, but the people wept and

working on this, members of my staff working hard on this. i cannot be prouder. 66 years ago, in the dense, snow-covered forests of western europe, allied forces were beating back a massive assault in what would become known as the battle of the bulge. in the final days of the fight, a regiment in the 80th division, patton's third army, came under fire. the men were traveling along a narrow trail. they were exposed and they were vulnerable. hundreds of soldiers were cut down by the enemy. during the firefight, a private tumbled 40 feet down the deep side of a ravine.

dazed and trapped, he was as good as dead. but one soldier, a friend, turned back, and with shells landing around him, amid the smoke and chaos and the screams of wounded men, this soldier, this friend scaled down the icy slope, risking his own life to bring the private to safer ground. for the rest of his years, he credited a this soldier, this friend, named andy lee, with saving his life, knowing he would never have made it out alone. it was a full four decades after the war when the two friends reunited in their golden years that lld learned that the man

who saved his life -- lloyd learned that the man who saved his life was gay. he had no idea, and he didn't much care. lloyd knew what mattered. he knew what had kept him alive, but made it possible for him to come home and start a family and live the rest of his life. it was his friend. n is with us today, and he knew that valor and sacrifice our note more limited by sexual orientation -- are no more limited by sexual orientation than they are by race or gender or religion or creed. what made it possible for him to survive the battlefields of europe is the reason we are here today. [applause]

that is the reason we are here today. this morning i am proud to sign a law that will bring an end to don't ask don't tell. [applause] it is -- this laws i'm about to sign will strengthen national security, and pulled the ideals that our fighting men and women risk their lives -- uphold the ideals that are fighting men and women risk their lives to defend. no longer will thousands of patriotic americans be forced to leave the military or a list of their skill or bravery or --

regardless of their skill or bravery or their zeal or exemplary performance, because they are desperate a lager will tens of thousands of men and women in uniform -- because they are gay. no longer will tens of thousands of men and women in uniform he forced to live a lie. [applause] as admiral mike mullen has said, our people sacrificed a lot for their country, including their lives. none of them should have to sacrifice their integrity as well. [applause] that is why i believe this is the right thing to do for our military, that is why i believe it is the right thing to do,. -- right thing to do, period.

i want to thank the democrats and republicans who put conviction ahead of politics to get this done together. [applause] i want to recognize nancy pelosi. [applause] steny hoyer. [applause] and harry reid. [applause] today we are marking a historic milestone, but also the culmination of two of the most productive years in the history of congress, in no small part

because of their leadership. and so we are very grateful to them. [applause] i want to thank joe lieberman -- [applause] and susan collins. [applause] and i think carl levin is still working. [laughter] but i want to add carl levin. [applause] i am so proud of susan davis,

who was on the stage. -- is on the stage. [applause] and a guy you might know, bernie frank -- barney frank. [applause] they kept up the fight in the house. and i've got to acknowledge patrick murphy, a veteran himself -- [applause] who helped lead the way in congress.

i also want to commend our military leadership. ending don't ask don't tell was a topic in my first meeting with secretary gates, admiral mullen, and the joint chiefs. [applause] we talked about how to a end this policy, we talked about how success in passing and implementing this change dependent on working closely with the pentagon, and that is what we did two years later, i am confident that history will remember well the courage and vision of secretary gates -- [applause] of admiral mike mullen, who

spoke from the heart and said what he believed was right -- [applause] of general james cartwright, the vice chairman of the joint chiefs, and to get the secretary -- did deputy secretary william lynn, who is here. also, the authors of the pentagon's review, jay johnston

and general carter ham, who did outstanding and to do is work. -- meticulous work. [applause] at all those who laid the groundwork for this transition. finally, i want to express my gratitude to the men and women in this room who have warned the uniform of the united states armed services. -- worn the uniform of the united states armed services. [applause] i want to thank all the patriots who are here today, all of them who were forced to hang up their uniforms as a result of don't ask don't tell, but who never stopped fighting for this country, who rally and march and fought for change.

i want to thank everyone for your who stood with them in that fight. because of these efforts, in the coming days we will begin the process laid out by this law. all the policy remains in effect until secretary gates and admiral mullen and i have certified the military readiness to implement the repeal, it is especially important for service members to remember that. i have spoken to every one of the service chiefs, and they are all committed to implementing this change swiftly and efficiently. we're not going to be dragging our feet to get this done. [applause] now, with any change, there is some apprehension. that is natural.

but as commander-in-chief, i am certain that we can effect this transition in a way that only strengthens our military readiness. people look back on this moment and wonder why it was ever a source of controversy in the first place. [laughter] i have every confidence in the professionalism and patriotism of our service members. just as they have adapted and grown stronger with each of the other changes, i know they will do so again. i know that secretary gates, admiral mullen, as well as the vast majority of service members themselves share this view. they share it based on their own experiences, including the experience of serving with a dedicated, and to keep out service members who were also getting -- dedicated, duty- bound service members who were also debris as one special

operations fighter said during the review -- "we have one gay guy in the unit. he is big, he is mean, he kills lots of bad guys." [laughter] "no one cares that he is gay c." i think that sums up perfectly the situation pr. [applause] finally, i want to speak directly to the gay men and women serving currently in our military. for a long time, your service has demanded a particular kind of sacrifice. you haven't asked to carry the added burden of secrecy and isolation -- have been added to carry an added burden of secrecy and isolation, all while putting your lives on the line for freedoms and privileges that are

not fully granted to you. you are not the first to have carried this burden. while today marks the end of my particular struggle that has lasted almost two decades, this is but a century in the making. their service has been obscured in history, lost to prejudices that have went in our -- waned in our own lifetimes. but at every turn, at every crossroads in our path, we know that gay americans fought just as hard, give just as much to protect this nation and the ideals for which it stands. there can be no doubt that there were gay soldiers who fought for american independence, who consecrated the ground at gettysburg, who manned the trenches along the western front, who stormed the beaches of iwo jima. their names are etched into the walls of our morals --

memorials, their headstones dot the grounds at arlington. as the first generation to serve openly in our armed forces, you will stand for all of those who came before you, and you will serve as role models for all who come after. i know you will fulfill this responsibility with integrity and honor, just as you have every other mission with which you have been charged. and you need to look no further than the servicemen and women in this room, distinguished officers like former navy commander zoe dunning. [applause] marines like eric alva, one of

the first in iraq. [applause] leaders like capt. jonathan hopkins, who led a platoon into northern iraq during the initial invasion, quelling an e thnic riot and earning a bronze star with a valid. -- valor. [applause] he was discharged only to receive letters and emails from soldiers saying they had known he was gay all along. [laughter] and that they thought he was the best manner they ever had. -- best commander they ever had. [applause]

there are a lot of stories like these, stories that only underscores the importance of enlisting the service of all who are willing to. that is why i hope that those soldiers, sailors, airmen and marines who weapon discharged under this discriminatory policy will seek to reenlist once the policy is implemented. [applause] that is why i say to all americans, gay or straight, who want nothing more than to defend this country in uniform, your country needs you, your country wants you, and we would be honored to welcome you into the ranks of the finest military this world has ever known. [applause] some of you remember i visited

afghanistan just a few weeks ago. while i was walking along the road, there was a big crowd, about 3000, a young woman in uniform was shaking my hand and other people were grabbing and taking pictures she pulled me into a hug and she whispered in my ear, "get don't ask don't tell done." i said to her, "i promise you i will." for we are not a nation that says "don't ask don't tell." we are a nation that says "out of many, we are 1." we are a nation that welcomes the service of every patriot, a nation that believes that all men and women are created equal. those are the ideals that generations have fought for,

those are the ideals that we uphold today. now it is my honor to sign this bill into law. [applause]

[applause]

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>> president obama will be holding a news conference this afternoon at the white house, scheduled at 4:15 eastern. the house is in recess, but will be returning this afternoon to vote for a $4 billion fund for 9/11 responders. the senate passed the measure this afternoon. approval by the house and then to the president. earlier the house cent pay -- sent a bill to the the president for defense spending. the senate earlier passed the start arms treaty with russia. it limits strategic needs

clearer -- nuclear warheads. the senate continues to work before recessing for the holidays. you can see live senate coverage on c-span2. >> on c-span, christmas eve, nancy pelosi and other members of congress like the capitol christmas tree. later on the 50th anniversary of the first televised debate, preparation for a presidential debate and its impact on a campaign. christmas day, tony blair on the role of religion. garrison keeler talks about humor in public life. and sandra day o'connor and david souter discuss life on the high court. >> john brennan today describes steps the government has taken

since the christmas the bombing attempt last year. robert gibbs talks about the repeal of don't ask don't tell, the agenda for next year, and other issues. this is about an hour. >> good morning. good night. john brennan is going to give us a quip -- quick update on steps we are taking around the holiday season to ensure security as well as to discuss some actions that have been taken over the course of the past year after an incidents like december 25.

>> thank you, robert, and good morning, everyone. as we enter the holiday season, the homeland security committee is collectively focused on everything they can to prevent terrorism obstructing the safety of americans as they travel, spend time with family and friends, and enjoyed holiday festivities at home and abroad. we remain capitalist to attempt by al qaeda and terrorist organizations to carry out attacks against innocent man women and children and are working very closely to share all credible information immediately and the ornate closely our counter terrorism and security activities. these partnerships are critically important to our ability to lead the fight would- be terrorist and to thwart their plans before they would be able to act. in response to the president's direction, senior officials from the departments and agencies met

yesterday at the white house review the latest and coordinate plans that will be in place during the holiday seasons. finally, president obama has provided an update on the many steps that have been taken over the past year to enhance our capabilities. as a result, including the tragic shooting at fort hood, texas, the attempted bombings of aircraft, as well as times square in new york city, and a variety of rsx -- of arrests. these enhancements include protocols for information sharing between the department of defense and the fbi, clarified analytic responsibilities and new and libby training courses within the community, improvements and refine its in the watch-list

process that service the counter-terrorism community. accelerated deployment of advanced imaging technology in airports and advances from carbo screening and security cooperation. protecting the american people is an ongoing and constantly evolving process. it is the goal of the counter- terrorism community to stay several steps ahead of our adversaries so we can stop terrorists dead in their tracks before they are able to carry out either small scale or potentially devastating attacks. that is what the president has directed. that is what the american people rightly expect and deserve. and that is what we are bound and determined to do. thank you. >> wondering if -- you cannot talk about specifically intelligence, but you know of

anything that is driving these efforts? >> as we have discussed previously, we're concerned about how high the's plan to carry out attacks and the state department has issued an advisory about europe and plans by al qaeda to carry out attacks there. we did not limit our focus to one jury graphic area. that is why we are looking at if there is something looking at the homeland here. we received reporting and tried to investigate and scrutinize it carefully. we need to be on top of our game particularly during the holiday season, but also throughout the year. >> it sounds like it is been shifting recently to a concern about multiple small attacks. is that an accurate description? >> we are concerned and stay vigilant about both ends of that spectrum as far as a large scale

attack and small-scale once. the enhancements we have made the tree over the past decade have made it more difficult for terrorists to conduct these large-scale attacks. we have degraded their capabilities and abilities to plot and moved operatives. what we have seen recently is increased focused on the part of terrorist groups to carry out some of these small-scale attacks, and we are stay focused on our ability to detect those types of attacks and stop them whether by individuals or part of a larger organizational effort. >> your statement does it alarm americans or reassure them that they will be safe? >> the statement is intended to reassure americans there are fellow americans working in homeland security and law enforcement community, working round-the-clock to protect their fellow citizens. we will not rest because we know that al qaeda and other

organizations are still out there. we will do our best to obstruct these plots before they make it to the homeland. what we want to do is let the american people know we are on the job, staying vigilant, working with partners, not just international partners, but also state and local partners, and we will continue to do so throughout the holiday season and beyond. >> is there particular concern during the holidays, given the enormity of the problem? >> there is a fair amount of volume going to the different transportation sectors, aviation, rail, and other areas. we want to make sure we're able to provide the security to the traveling public. we want to make sure that we look into the reports about threats to the american people. as janet nepal, said the other day, there's nothing credible to

be seen. sometimes we have a strategic morning. we are not going to wait. we will be poised every day. >> from last time, the christmas bomber, are you confident now that that situation will not happen again? >> i am confident that the deficiencies that we identified in this system have been addressed. some of the reasons why certain information was not shared, we have taken steps to ensure that that type of problem is not happen again. one of the things that the president has insisted we do in each of these incidents is to look back and see where the system worked where, where it fell down, what changes we can make in information technology or business process.

i am confident that these deficiencies we identified are being addressed and that we are much better positioned than we were last year at this time. >> >> monday there were 12 individuals in united kingdom who were arrested on a suspected terrorist plot. can you tell us more about that, anything about that, and also if the problem results in sharing have been solved, can you explain why the director of national intelligence did not know that at 3:45 on monday, when these injured -- are arrests took place, how it is possible that hours later he had not been told? >> i will be pleased to address that. let me address your first question first, and i will defer to my british counterparts to provide information about their investigation. we are in constant contact with the british, since the beginning

of this state-down of the individuals in britain, to work with them to find out if there was any nexus, to find out whether their -- jim clapper was working on developments in the korean peninsula. he was focused on trying to provide support to the congress as far as the start treaty deliberations were concerned. he was engaged in a variety of classified matters. should he had been briefed by our staff? yes. it was constantly on the news networks. i am glad that jim is not sitting in front of the tv 24 hours a day monitoring what is coming out of the meeting. he is focusing on those issues the president expects him to focus on and make sure we did

not have conflicts in different parts of the world. he continues to focus on less. his not being briefed yesterday afternoon is something that they have acknowledged he should have been briefed on, have taken steps to correct that, and if it happens again, he will be au courant in terms of a take-down overseas. >> are you suggesting the threat was not serious enough to have a reason to that level? >> there was the sharing of the information from the british to u.s. officials. we are in touch with the british truck the day and continue to be so. there was no action at the dni had to take. he was focused on those matters that required his direct attention and he was giving full attention to those matters, and that president was pleased that he was focused on that. there is going to be things that the dni will need to be involved

in, but at that time there was nothing dni needed to do that would have required him to set aside other pressing intelligence matters to get briefed on what was being put out in the press. >> thank you. >> the he say there was currently no credible threat? >> we will send out a transcript that will have the answer, and i hope you guys should have the paper which will also, electronically, going through as you heard sean say that corrective actions and the result of the president's asking for after-action reports.

on instance and disruptions that taken place over the course of more than a year. >> our people want to see and feel more security during their holiday travel? >> i think that is taken care of. we wanted to give a sense importantly of what has been done as a result of what john mentioned last year as a failure in our security and intelligence apparatus, relating to the attempted bombing on christmas day. it is important for the american people to understand we take the

threat enormously seriously. there is a huge part of our government that is focused on those threats and on their security, and we wanted everyone to be aware of those steps being taken in the intervening weeks and months to address them. i do not anticipate that people will see or feel an increase or an inconvenience in their travel plans, but we are taking all the necessary steps and measures across, not just air travel, but other modes of transportation. >> the recently initiated searches of bags in the d.c. metro, will we expect to see

that in other areas? >> i do not want to talk about specifics. obviously john and others looked at intelligence and reporting across many different modes of transportation and many different -- and are aware of an acting on information across a broad spectrum. >> this is the first time since right after 9/11 there have been searches of bags in public transport systems. >> we will take whatever actions are necessary to ensure a heightened sense of protection. yes, sir? >> maybe my recollection is wrong, but aside from the underwear bombing attack last christmas day, we in washington

and the media get breathless each holiday tellin about security. >> john will probably tell you there is quite frankly a little bit of both. obviously, you have around the holiday season, whether it is thanksgiving or whether it is around christmas, you have a huge increase in the volume of those that are moving around. you have as you mentioned at other times, times square or the aqap plot and dark -- involving cargo planes, which is not

fixed necessarily to make holiday. that is why one of the points that john wanted to make was regardless of the day on the calendar, there is a vigilance that must be maintained around the clock in order to insure that we are doing all we possibly can in taking the steps that are necessary to rightly protect the american people and to inform them of france -- threats that might be had outside the homeland. this is largely an informational briefing on john's part to give you a sense of what we are doing. >> i was struck by the president saying that he was overwhelmed and obviously there was a lot of a motion to that ceremony. can you put some context in

having been with him for many years, is that one of the more emotional times you have seen him in that kind of setting? >> i think watching it on television as well as -- i was not there, i wish i would have been -- but this is something that the president has fought long and hard for and believed needed to be done for many years. when i started working for him in april of 2004 and as part of his campaign for the u.s. senate, he had pledged to vote for the repeal of this policy because he thought it was wrong. i think today represents the

beginning of a process that ends that policy. the president had occasion to speak with admiral mullen and several of the joint chiefs yesterday to discuss what is now being implemented in terms of a working group that will lead to the certification by the secretary of defense, the chair of the joint chiefs, and the president that the policy is officially ended. the president's belief in discussing with the chiefs is that this is a matter of months, and he looks forward to that happening. i do think it was -- i do think this was -- this is an accomplishment that he is enormously proud of and happy that it was one that was not

just the work of one party, but by those across party lines that believed that the policy was wrong, did not make any sense for our national security, and is now in the process of being ended. >> some of the advocates who have fought for this for so long, do they see that as an opening for greater justice for their cause? do you see that as well, that the country is ready for more equality? >> i think whether you look at the attitudinal study that was done at the pentagon or any assortment of public polling conducted by your news organizations, it is fair to see that the attitudes of americans

about the shooting or who could serve in the military has clearly changed over the course of the last several years. what that leads to in the future is harder to tell, because some of this stuff obviously has to go through a divided congress. yes, ma'am? >> harry reid said he expected that start would be ratified by 2:00. can you tell us any more about how many calls the president has made? >> we will have more of that when the bill -- when the treaty is ratified. >> on north korea and south korea, south korea announced that they would be doing a large military operation. what is the white house thinking in terms of whether that might provoke a response from north korea? >> our belief is obviously the

exercises have been well publicized, they were announced well in advance. everybody in the world is aware that they are happening, and there are exercises that are defensive in -- in nature. the united states is obviously in support of the republic of korea. >> given the climate lately with pyongyang and the problems on the -- is their concern that there might be more of an escalation? >> exercises that have been announced well in advance that are transparent, that our

defensive in nature, should in no way in gender -- engender a response from the north koreans. >> what is the fundamental principle underlying the president's belief that the repeal of don't ask don't tell is important? is it national security? is it votes? >> it is all that. the president believed it was unjust. we believed we have a number of brave men and women that were willing to sign up for their country, willing to serve the country, and willing to die for their country. the story that the president opened his remarks with today was one that was quite moving. i think the president is glad to see this day, on the grounds of both greater equality and an

enhancement of our national security. >> is it any less unjust that the same day trips cannot get married? -- that this same gay troops cannot get married to someone of the same sex? >> i will refer you to his remarks on that. >> his remarks are that he believes marriage is between a man and a woman. >> you asked me what president felipe, and that is what i said. >> -- what the president believes, and that is what i said. >> on principle he seems to have a border. it does not apply to everybody.

is there any consequence at all to the israeli government constantly disagreeing with the government house position on house and the belmonts, or is there not? >> -- on housing developments, or is there not? >> our government has a position that dates back to the administration of lyndon thought johnson -- lyndon johnson about our views on housing, and we will continue to make our position known. again, as we have for many administrations. that does not stop our efforts to remain engaged for a comprehensive peace process. we understand- what happens when our country is

not engaged in a vault in the process of actively working with each side to bring about a comprehensive peace, that is a long and bumpy road, but the president continued to do that. >> the same at play with pakistan and saudi arabia, to engage with them as long as they do things that we did not like? >> meaning what? >> the reporter said that there are safe havens. >> i do not know if you are trying to link a series of those things. obviously, we have important bilateral relationships where we agree and disagree within those relations its. dan? >> give us eight time frame as to when the policy will be certified.

>> the president discussed with mullen and others yesterday that fact that as a group they believe this is a time frame that is a matter of months. i do not have anything more specific. >> what is the president but to do to make sure that it stays within the months-long time frame? >> he had an interest yesterday in discussing with the chiefs and with the chair, and i will gates and with east mullen had a big role in seeing this happen. to say that the joint chiefs said that this policy needed to be changed was a historic moment. now they are charged with the

job of implementing this change, and their commitment to the president is that it can be done in a very timely manner. again, i think you have seen or there has been conjecture about when that will happen. again, i think the president was very clear that this is not something should drag on. >> anything more on whether we will see the president today? >> if you can tell me when congress leaves, i can enter the above questions. i anticipate at some point you will see the president today. i should start a pool as to when that will be. look, i would like to do it now and then we can go about our christmas shopping and doing whatever things we have not been able to do as a result of this. regrettably, dan, you and i hold very few cards in this long

process. i anticipate that you will at some point see him. i will say as a pure housekeeping matter where not likely to have a ton of time in terms of when you see the advisory, so to help out caroline and others, when you see the advisory, please rsvp people that need to come into this building and there will be limited time to do that. please tell your organizations that give them that heads-up. a news conference. i got out of the prognosticating business around health care. >> president and you and others in the the ministry should have made it clear that even though [unintelligible]

will continue to pursue it in the next congress, and other goals like tax reform, even though that was that much more heavily against you -- [laughter] >> presumably, in that there is a punctuation of the question mark. >> how are you going to be able to do that if so far it has almost been impossible? >> how much would you bet me that we have gotten done all we are about to get done? somebody, please take record this on my vcr so i can record this. i am talking to bill. [unintelligible]

again, i think the president will have the opportunity to discuss what has been accomplished over the past six weeks. the path for how we can work together and accomplish stuff that is in the national interests next year, but noting that i doubt many people would have thought that we would have a free trade agreement that enjoys the support of the chamber of congress and the united auto workers, huge bipartisan majorities supporting a tax agreement that allows the unemployment benefits to last throughout all of next year, provides certainty in tax rates

that will not rise for middle- class families, that we have begun the repeal of don't ask don't tell through a congressional process, and, not on what, let me finish, the likely ratification of a start agreement whose obituary has been written more times than i could care to remember -- none of that was easy and none of what has happened going forward is easy. i know the president believes that there are and i think those milestones that i just mentioned -- i think what they showed the president is that when people get together and understand and believe what is in the best interest of the american people, certainly in tax rates, repeal of policies that people believe are unjust,

or something that protects our national security, that we have far more in common than we do in opposition and that working together we can get things done. that is what and a maid -- animated him to run for public office, to run for president, and that is what has animated his actions over the past six weeks. >> that is all good for you, but what incentive to republicans have to cooperate with him in the next congress? >> they control part of government. a budget is going to a originated in the house of representatives. funding bills are going to originate in the house of representatives. the incentive they had is less an incentive and more of our responsibility. they are charged with having to run half of the legislative

branch. as i said yesterday, i think that has to kick in -- that responsibility has kate in to some degree a bit early, and you have seen all what i just mentioned happen -- obviously, a free trade agreement has not on three get in congress, but we saw bipartisan support for that free trade agreement. use of each of the things that went to congress legislatively not done by a vote of one party, but by the votes of both parties. i think it is a path that the president thinks will not be easy to follow, but provides a path for how we can get things done that are in the interest of the american people. that is what the election was about. as i said yesterday, the election was not about how we grind his best to halt, how do we play more political games, it is about how we get things done that the american people

understand are in the best interests of the american people. >> i will play that tape again in six months. [unintelligible] >> he makes fun of me. i get it. >> the changes in the treatment of the prisoners in gitmo, can you talk about those -- the president has ordered some changes in the rights, if you will, of prisoners in guantanamo bay that cannot be brought to trial. >> the draft executive order? ok. let me change -- >> you are right because it has not been finalized yet. >> it is a process that is a document that has not even begun the process of a deputies

committee meeting, it has not been removed by the president. i do not think that it is or should be surprising to many offer the speech into this and nine that there are going to be those that are currently in guantanamo bay that, for whatever reason, are not going to be able to be tried in either a federal court or in a military commission that are going to have to be indefinitely detained. the president was clear on that in may, and i have no comment on the draft is a hit of order largely because it is a long way from ever even reaching the president's desk. >> i am wondering if that process is intended to make the facility at guantanamo bay

somewhat more acceptable to the president. >> i will not mess with the premise of your question, but he has said that because al qaeda has used it as such. they have used it as a recruitment tool, and our generals and commanders see it being used as a recruitment tool. obviously, the present -- i refer you to the speech in may of 2009 that seeks to do -- i would say, probably, the president does not believe that our national security and the protection of our homeland has to be in contradiction with our values as americans. that is what animates him in this entire process. >> and the draft order is in no way connected with having to live with guantanamo bay?

again, i do not want to divorce the center from the draft executive order, because it is a process that is -- has certainly not worked its way through even to the deputies committee procedure. as the president said, nobody would find it surprising that a president and this administration understand that there are those that have been evaluated by our intelligence community, by the defense infrastructure, that we understand that there are some that will require indefinite detention. >> the president is still committed to close in guantanamo bay. when is this going to happen? >> i do not know. that remains a presidential goal.

for the president signed the continuing resolution to fund the government until march this morning. yes, sir. >> you are seeing a significant number of republicans supporting the start treaty. mitch mcconnell said his priority was to prevent the president from being reelected. is this a type of moving forward? the need to negotiate within in the next congress? >> as we have said before, we are calling to have to and we will work with republican leaders in congress more closely than we have in the past couple of years. as i said earlier, they have a responsibility to the governing of this country, unlike they had

had in the previous two years. again, i think -- i think the result of what has happened over the past few weeks is less somebody losing control of their caucus and more those in that caucus understanding the message work together and get things done, do not relitigate the fights of yesterday. there's plenty of time before the next election. focus not on your political future, but on our future. that is the message the american people are sending, and that is the message people in congress have heard -- the amount we are leaving the last 20 minutes of this program.

the house has gaveled back in. members will be voted on a bill to provide $4 billion for emergency responders. the senate passed the bill this afternoon. if approved by the house, the bill goes to the president. i am, signed es sincerely, lorraine c. miller, clerk of the house. the speaker pro tempore: the chair lays before the house the following communication. the clerk: the honorable the speaker, house of representatives. madam, pursuant to the permission granted in clause 2-h of rule 2 of the rules of the u.s. house of representatives, the clerk received the following message from the secretary of the senate on december 22, 2010, at 2:17 p.m. that the senate passed without amendment h.r. 6398. with best wishes i am, signed sincerely, lorraine c. miller, clerk of the house. the speaker pro tempore: the chair lays before the house the following communication. the clerk: the honorable the

speaker, house of representatives. madam, pursuant to the permission granted in clause 2-h of rule 2 of the rules of the u.s. house of representatives, the clerk received the following message from the secretary of the senate on december 22, 2010 at 11:30 a.m. that the senate passed senate 4053. with best wishes i am signed sincerely, lorraine c. miller, clerk of the house. the speaker pro tempore: for what purpose does the gentleman from new york seek recognition? mr. arcuri: madam speaker, i ask unanimous consent that when the house adjourn today on a motion offered pursuant to this order it adjourn to meet at 11:00 a.m. on friday, december 24, 2010, unless it sooner has received a message from the senate transmitting its concurrence in house resolution 336 in which case the house shall stand adjourned sine die pursuant to concurrent resolution. the speaker pro tempore: is there objection? without objection, so ordered.

for what purpose does the gentleman from new york seek recognition? mr. arcuri: i ask unanimous consent that it be in order at any time to take from the speaker's table the bill h.r. 847, with the senate amendment thereto and to consider in the house without intervention of any point of order except those arising under clause 10 of rule 21, a motion offered by the chair of the committee on energy and commerce or his designee, that the house concur in the senate amendment, two, that the senate amendment be considered as read. three, that the motion be debatable for 30 minutes equally divided and controlled by the chair and ranking minority member of the committee on energy and commerce, and four, that the previous question shall -- be considered as ordered to the motion for final adoption without intervention motion. the speaker pro tempore: is there objection to the request? without objection, so ordered. the chair lays before the house

an enrolled bill. the clerk: h.r. 5470, an act to exclues an external power supply for certain security or life safety alarms and surveillance system components from the application of certain energy efficiency standards under the energy policy and conservation act. the speaker pro tempore: for what purpose does the gentleman from new jersey seek recognition? mr. pallone: pursuant to the order of the house of today, i callp the bill h.r. 847, with the senate amendment thereto and i have a motion at the desk. the speaker pro tempore: the clerk will designate the title of the bill. the clerk: h.r. 847, an act to amend the public health service act to extend and improve protections and services to individuals directly impacted by the terrorist attack in new

york city on september 11, 2001, and for other purposes. senate amendment, mr. pallone of new jersey moves that the house concur in the senate amendment to h.r. 847. the speaker pro tempore: pursuant to the order of the house of today, the motion shall be debatable for 30 minutes equally divided and controlled by the chair and ranking minority member of the committee on energy and commerce. the gentleman from new jersey, mr. pallone, and the gentleman from texas, mr. burgess, each control 15 minutes. the chair recognizes the gentleman from new jersey. mr. pallone: madam speaker, i ask unanimous consent that all members may have five legislative days to revise and extend their remarks and include extraneous material on the record. the speaker pro tempore: without objection. mr. pallone: madam speaker, i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. pallone: i rise in strong support of the senate amendment to h.r. 847, the james zagroda 9/11 house commenation act for of 2010.

the body will vote on legislation to finally keep our promise and take care of the heroes of 9/11. i'd like to thank the bill's sponsors, representative carol maloney and gerry nadler, as well as my colleagues from new york on the committee, eliot engel and anthony weiner, also for their tireless work. madam speaker, this bill would establish the world trade center health program, a program to screen, monitor, and treat eligible responders and survivors who were suffering from world trade center related diseases. it is also reopens the 9/11 victim compensation fund. h.r. 847 as amended cost $4.2 billion over 10 years. of that amount 1.5 will go to the health program, while $2.5 billion will go to the bc the amended bill before us today changes how the two programs are paid for by 2% fee on government procurement from foreign companies located in nongovernmental procurement. and one-year extension of h-1. --- h-b-1 visas.

that has been a huge priority for me and many of my colleagues in the house and senate. i urge my colleagues to pass the bill. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves. the gentleman from texas is recognized. mr. burgess: thank you, madam speaker. i appreciate the gentleman's efforts in this regard. i would like to take a few moments and clear up some mischaracterizations that have occurred, unfortunately, around the debate of this bill as it's worked its way through both houses. there have been some who claimed that my side, the republicans, do not support providing treatment for 9/11 first responders. and that these first responders are currently going without treatment for the illnesses and injuries they suffered as a result of serving at the world trade center. both of those claims are simply not true. according to president obama's

administration's own center for disease control, the agency said, i quote, we'll continue to provide monitoring and treatment services for mental and physical health conditions related to world trade center exposures for both responders and for eligible nonresponders. the world trade center program is critical in meeting the ongoing and long-term special needs of individuals that were exposed to dust, smoke, degree, and psychological dralm from the world trade center attacks. as of september 30, 2009, the world trade center program enrolled over 55,000 responders in its programs. this is the center for disease control's budget -- this is in the c.d.c.'s budget justification for 2011. as the energy and commerce committee's mark of this legislation, republicans offered an amendment that would authorize the program that is already providing treatment and monitoring benefits and authorize funding for the

program at exactly the level that was requested by the president of the united states. that same amendment asked for real accountability to ensure that we knew how the tax dollars were being spent. unfortunately, that amendment was defeated. now, i am pleased that work in the senate has yielded an amendment that will provide for increased accountability, increased transparency, and how these funds are spent. h.r. 847 caps the number of people that can be enrolled in the program. but it does not require those enrolled to verify their citizenship. we offered an amendment that would require this program so that people in the country without benefit of social security numbers would not get benefits while americans were being stuck on the waiting list. this amendment was defeated. as with any government spending program, there should be limitations on who can participate. the government has limited resources so the principal beneficiaries of the 9/11 health program should be the first responders. however, h.r. 847 provides more

than just benefits to first responders, but also provides benefits to anyone who lives and works in new york city. under this bill, even wall street millionaires could receive benefits with no cost to them all done at the taxpayers' expense. in the committee on energy and commerce, i offered an amendment that was rejected by the committee. i attempted to offer the amendment at rules when this legislation was brought before the house before our adjournment in september, but i was thwarted in that. but, it remains that we ought to ensure that federal taxpayers would not have to pay for the health care of millionaires. . limited resources are being spent in the most efficient manner possible and the accomplishments that have been taken are all to the good.

this is an important legislation and something this congress should have passed in the last eight years and it is unconscionable we are here on the last day with still this work pending. it is important to get this work done. and i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from new jersey is recognized. mr. pallone: i yield one minute to the the gentleman from california, mr. waxman. the speaker pro tempore: the gentleman is recognized for one minute. mr. waxman: i rise in strong support of h.r. 847 the james zadroga 9/11 health and compensation act. i thank frank pallone and my colleagues from new york on the committee, eliot engel and anthony wiener and representative maloney and nadler and the whole new york city delegation, who are tireless in their support of this bill. this is an important piece of legislation that will attempt to

provide the services to first responders and community residents who develop illness as a result of their exposure to the massive toxic dust include that blanketted lower manhattan after the terrorist attack on september 11, 2001. i urge all members to support this legislation. and i will have a further detailed description of it in my prepared statement. yield back. the speaker pro tempore: the gentleman yields. the gentleman from texas is recognized. mr. burgess: i yield one minute to the the gentleman from oklahoma, mr. cole. the speaker pro tempore: the gentleman is recognized for one minute. mr. cole: i thank the gentleman for yielding. madam speaker, long before new york city's first responders rushed to save fellow americans in the fire and horror of 9/11, they came to help the people of oklahoma city deal with the death and destruction with the bombing of the federal building on april 19, 1995. people of oklahoma never forgot

the help they received from the help from first responders in new york city and all across america. oklahoma's first responders were proud to join fellow americans and rushed to the aid of a stricken new york city. it's our turn in this body to help all of those who answered the call of duty on 9/11. they risked themselves to save others and help one of america's debate cities deal with and recover from the devastation of the greatest terrorist attack in our history. it's time in earlier era to bind up the nation's wounds and borne the battle for his widow and/or fan. i urge the passage of h.r. 847 and yield back. the speaker pro tempore: the gentleman's time has expired. the gentleman from new jersey is recognized. mr. pallone: i yield to one of the sponsors of this bill, mr. nadler of new york, one minute. the speaker pro tempore: the gentleman from new york is recognized for one minute.

mr. nadler: let me first thank everyone who has worked on this bill and the senate passed this bill unanimously. senators enzi and coburn supported it and i hope we can do the same. the heroes of 9/11 ran into the buildings and rushed into the burning buildings and worked in a toxic environment for weeks and months. they have suffered for that. they have suffered for their service to this country by getting sick, by dying, by being sick. it is now up to us to see that the united states honors its heroes, that the united states does not turn its back on those who served us. when we passed this bill, we will answer the question whether the united states honors its heroes and whether the united states honors itself. let us pass this bill. let us redeem the honor of the united states after all these years. let us show the world that the united states looks after its

own. that's what this bill is. i urge everyone to support it. i thank you and yield back. the speaker pro tempore: the gentleman's time has expired. the gentleman from texas is recognized. mr. burgess: may i ask that the house be in order during this debate. it is an important debate. the speaker pro tempore: the gentleman is correct. the house is not in order. members, please take their conversations out of the chamber. mr. burgess: i yield two minutes to the gentleman from texas on the ways and means committee, mr. brady. the speaker pro tempore: the gentleman is recognized for to minutes. mr. brady: i support the goals that the brave men and women who acted as first responders are fairly treated and compensated. i rise today to oppose the troubling provision, the majority to pay for this bill. this would impose a 2% tax on goods from foreign countries from firms that are not parties to certain treaties or international agreement. sounds complicated, but some analysts suggest that majority

of the tax, at least 2/3 would be raised by taxing contracts that support american troops stationed in the afghan and iraqi theaters. even more incredible, this tax could apply to american companies that are providing goods and services to our troops through local subsidiaries. levying taxes on companies that support american troops are illogical. there is no reason that other countries wouldn't copy this tax and impose it on our u.s. companies that are competing to sell goods and services overseas. this would hurt our u.s. economic recovery efforts and efforts to boost u.s. sales abroad and trade american jobs here at home. i have real concerns that this tax could be subject to legal challenge at the world trade organization and may be inconsistent with our g-20 commitments to avoid imposing new protective measures. i urge a no vote because of these provisions and strangely

the proposed procurement tax doesn't include any of the exemptions in our standard buy america legislation, just as unreasonable costs and inconsistency with the public interests. the bill would mandate a tax on the procurement of goods even when u.s. goods aren't available. in addition to this new tax, the bill would stepped a tax on companies that more than half their employees on certain specialized visas to work here in the united states. this tax raises independent concerns under our international obligations. i ask unanimous consent for -- an additional 30 seconds. mr. burgess: yield 30 seconds. mr. brady: i ask unanimous consent to have a letter in the record, including the emergency committee for american trade and u.s. chamber of commerce that oppose the use of these pay-for provisions. i yield back. the speaker pro tempore: members

and staff are please reminded to remove their conversations from the floor. the gentleman from new jersey is recognized. mr. pallone: i yield one minute to the speaker of the house who has done so much to make this bill possible. the speaker pro tempore: the gentlewoman is recognized. the speaker: i thank the gentleman for yielding and i rise to briefly congratulate and thank the members of the new york delegation and others who helped bring this legislation to the floor in a strong bipartisan way. congresswoman maloney, congressman nadler, congressman king, thank you, we thank you for giving us the opportunity to say thank you in a real way to our first responders, to our firefighters, to those who rushed in without question to rescue their fellow americans and people from all over the country, as a matter of fact. there's an ex hill ration that you see in the chamber and that's why you have to keep

telling us to take our conversations right outside the room, because right now, we know that any discussion we have ever had about 9/11 has been a discussion where we have entered wholly and sacred ground, where people lost their lives, fewer did because others were willing to risk theirs. for over nine years, we have been trying to redress the grievance that we have of people not having the health benefits and the recognition of their service, their sacrifice and their courage. today, mr. king, ms. maloney, congressman nadler, soon chairman king to-be and the leadership of this house and the united states senate and i think senator gillibrand and senator schumer as well as senator reid

and the republican leadership in the senate for affording us this opportunity to be -- extend our patriotic appreciation to those whose love of our country, whose care and commitment to their fellow person, who unquestionably made sacrifices and now almost 9 1/2 years later, more than nine years later, we finally are doing the right thing for them. every day our firefighters, police officers, first respond leave their home to risk their lives. little did they know on that day, many of them would not return home. how can we ever repay their sacrifice and their courage? so today, we do so, certainly it's not enough, but as a token of our appreciation for what they have done to strengthen our country. with that, madam speaker, i yield back the balance of my time.

again, thanking all of those who made this legislation possible. the speaker pro tempore: the gentlewoman yields. the chair will receive a message. the messenger: a message from the senate. the secretary: madam secretary i have been directed by the senate to inform the house helping heroes keep their homes act of 2010 in which the concurrence of the house is requested. the speaker pro tempore: the chair recognizes the gentleman from texas, mr. burgess. mr. burgess: may i inquire as to how much time remains? the speaker pro tempore: the gentleman from texas has 7 1/2 minutes remaining. and the gentleman from new jersey has 10 1/2 minutes remaining. mr. burgess: i yield myself 30 seconds. the speaker pro tempore: the gentleman is recognized. mr. burgess: congressman brady articulated some of the concerns he has with the pay-for raising

revenues through tariffs and the possibility of actions by other countries. in section 4002 in the recently passed health care last march, there is a public health and wellness trust fund and $15 billion is in a slush fund in obamacare. this money could have been used to pay for this legislation and could have been done last april and we wouldn't be here at the last minute having to scrounge for capital to pay these funds. i reserve. the speaker pro tempore: the gentleman reserves the balance of his time. the house will be in order. members and staff are reminded to remove their conversations from the floor. the gentleman from new jersey is recognized. mr. pallone: i now recognize the gentlewoman from new york, ms. maloney who is the prime sponsor of the legislation who has worked hard on this bill. the speaker pro tempore: the gentlewoman is recognized for one minute. mrs. maloney: i thank my colleagues, especially the new

york delegation and the speaker, leader hoyer -- the speaker pro tempore: please suspend. mrs. maloney: today congress repays a long overdue debt and answers the emergency calls of our ailing 9/11 first responders and survivors. this bill will save lives. it's taken too long, but help, finally is here, for the thousands of americans who are suffering because of 9/11. our bill will give support and hope to more than 36,000 americans, who are ailing because of the attacks on our nation. it also says to future generations that if you are harmed in the service of our country, you will be taken care of. i couldn't be more proud of everyone who fought like hell to pass this bill, our senators gillibrand and schumer, my good friends, nadler and king and 9/11 responders and survivors who are here with us and the thousands of their brothers and sisters who could not.

john seal, you have been a warrior for this bill. thank you. just after the attacks, this body came together -- the speaker pro tempore: the gentlewoman's time has expired. mrs. maloney: with this bill, we put in law we will never forget and do whatever it takes. i ask permission to revise and extend and place in the record. the speaker pro tempore: without objection. the gentleman from texas is recognized. mr. burgess: reserve my time. the speaker pro tempore: the gentleman has seven minutes remaining. the gentlman reserves the balance of his time. the gentleman from new jersey is recognized. mr. pallone: madam speaker, i yield to the the gentleman from new york, mr. engel, for the purpose of a unanimous consent request. the speaker pro tempore: the gentleman is recognized. mr. engel: i rise in strong support of this bill. this is a fitting way to end the 111th congress and proudest moment i have had in congress for 22 years and i believe our hard work paid off all of us together. the speaker pro tempore: does the gentleman have a unanimous consent request? mr. engel: i urge my colleagues to support the bill.

the speaker pro tempore: without objection. the gentleman's remarks will appear in the record. the gentleman from texas. mr. burgess: i reserve. the speaker pro tempore: the chair recognizes the gentleman from new jersey. mr. pallone: i yield to the the gentleman from new york, mr. crowelly, for the purpose of a unanimous consent request. the speaker pro tempore: the gentleman is recognized. mr. crowley: on september 11, my cousin john moran was in tower two and said i want to make a difference. we made a difference in the lives of these people we are saving. thank you. the speaker pro tempore: the gentleman's remarks will appear in the record. a member asking to insert remarks may include a simple declaration of sentiment toward the question under debate but not embellish the request with extended remarks. the gentleman from texas is recognized. mr. burgess: i reserve. the speaker pro tempore: the gentleman from new jersey. mr. burgess: i yield to the the gentlewoman from new york for a unanimous consent request. ms. slaughter: i rise in strong

support of this bill. a lot of us are going to sleep a lot better now knowing this bill has been passed and i ask unanimous consent to revise and extend. the speaker pro tempore: without objection. the gentleman from texas is recognized. mr. burgess: i reserve my time. the speaker pro tempore: the gentleman reserves. the gentleman from new jersey. mr. pallone: madam speaker, i yield to the gentleman from new york, mr. rangel, for the purpose of a unanimous consent request. the speaker pro tempore: the gentleman from new york is recognized. mr. rangel. mr. rangel: all of us from the city of new york and around the nation are so proud to be a member of this body. i ask unanimous consent that i will be allowed to insert my remarks in the record. the speaker pro tempore: without objection. again, a member asking to insert remarks may include a simple declaration of sentiment toward the question under debate but should not embellish the request with extended oratory. the gentleman from texas is recognized. mr. burgess: i'll reserve my time. the speaker pro tempore: the

gentleman reserves. the gentleman from new jersey. mr. pallone: i yield to the gentleman from new york, mr. mcmahon, for the purpose of unanimous consent request. the speaker pro tempore: the gentleman from new york is recognized. mr. mcmahon: thank you, madam speaker. on behalf of staton island, trish and marty fullum, i ask unanimous consent to insert my statement into the record. thank you. the speaker pro tempore: without objection. the gentleman from new jersey will be charged with the time consumed. the gentleman from new jersey. mr. pallone: i yield to the gentleman from new york, mr. ackerman, for the purpose of unanimous consent request. the speaker pro tempore: the gentleman is recognized. mr. ackerman: i ask unanimous consent to revise and extend my remarks. the speaker pro tempore: without objection. the gentleman from texas is recognized. mr. burgess: i continue to reserve. the speaker pro tempore: the gentleman from texas reserves. the gentleman from new jersey. mr. pallone: i yield to ms. eshoo for the purpose of unanimous consent request. the speaker pro tempore: the gentlewoman is recognized. mr. shall ue: i ask -- mr. eshoo: i ask unanimous consent to revise and extend and say --

ms. eshoo: i ask unanimous consent to revise and extend. the speaker pro tempore: without objection. without objection, the gentleman will be charged with the time. the gentleman from new jersey is recognized. mr. pallone: i yield to mr. scott for the purpose of unanimous consent request. the speaker pro tempore: the gentleman is recognized. mr. scott: madam speaker, i ask unanimous consent that my remarks be entered into the record as a big thank you from a very, very grateful nation. the speaker pro tempore: without objection. the gentleman from new jersey will be charged. the gentleman from new jersey is recognized. mr. pallone: i yield to the gentlewoman from texas, ms. sheel, for purpose of unanimous consent request. -- ms. sheila jackson lee, for purpose of unanimous consent request. the speaker pro tempore: the gentlewoman is recognized. ms. jackson lee: i rise to support the senate amendment to h.r. 847, to be able to thank carolyn maloney -- the speaker pro tempore: without objection. ms. jackson lee: i ask that my statement be submitted in the record.

the speaker pro tempore: without objection, the gentleman from new jersey will be charged. the gentleman from texas is recognized. mr. burgess: i'll reserve my time. i ask that the house do maintain order. this is an important debate. the speaker pro tempore: the gentleman is correct. members are please reminded to take their conversations out of the chamber. the gentleman from new jersey is recognized. mr. pallone: madam speaker, i have no additional speakers. i reserve. i don't know if the gentleman from texas has additional -- mr. burgess: i yield three minutes to the gentleman from new york, mr. king. the speaker pro tempore: the gentleman is recognized. mr. king: i want to thank the house of representatives what it's going to do today. the speaker pro tempore: the gentleman will suspend. the house will please be in order. the gentleman may continue. mr. king: thank you, madam speaker. i want to thank the congress of the united states what it is going to do today, especially thank carolyn maloney and jerry nadler for the tremendous work they have done on this bill. i want to thank congressman veto

-- vito foe sello. and the speaker who managed to have this bill come up in a way that would not be disrupted. i want to thank the firefighters, police officers, all those who answered the nation's call on september 11. this is a great victory for the american people. it's a great victory for the congress of the united states. it sends a signal that we stand by those who come to their nation's defense in time of trouble and indeed of time of war. this war is the first battle for the great war of the 21st century. i yield back. the speaker pro tempore: the gentleman yields. the gentleman from new jersey is recognized. mr. pallone: i have, again, no additional speakers. i reserve. the speaker pro tempore: the gentleman reserves. the gentleman from texas is recognized. mr. burgess: thank you, madam speaker. i'll yield myself the balance of our time. this is an important bill. this is something that should have been done a long time ago. i credit a former new york fireman, richard, who is now my fire chief in louisville, texas, for helping me -- lewisville,

texas, for helping me understand how important this bill is. it's before us today. i yield back the balance of my time and urge support of the bill. the speaker pro tempore: the gentleman from texas yields. the gentleman from new jersey is recognized. mr. pallone: madam speaker, i would urge passage of this bill and send it to the president. i yield back the balance of my time. the speaker pro tempore: all time for debate has expired. the chair lays before the house an enrolled bill. the clerk: h.r. 6398, an act to require the federal deposit insurance corporation to fully insure interest on lawyers' trust accounts. the speaker pro tempore: pursuant to the order of the house today, the previous question is ordered. the question is on the motion of the gentleman from new jersey, mr. pallone. all those in favor say aye. those opposed, no. in the opinion of the chair, the ayes have it. the motion is agreed to, and

without objection, the motion to reconsider is laid on the table. for what purpose does the gentleman seek recognition? mr. burgess: i request the yeas and nays. the speaker pro tempore: the yeas and nays are requested. those favoring a vote by the yeas and nays will rise. a sufficient number having arisen, the yeas and nays are ordered. members will record their votes by electronic device. this will be a 15-minute vote. [captioning made possible by the national captioning institute, inc., in cooperation with the united states house of representatives. any use of the closed-captioned coverage of the house proceedings for political or commercial purposes is expressly prohibited by the u.s. house of representatives.]