advocate for justice. how can we bring a lot to-- the law into people's lives and help it serve and empower them? one of my early mentors as a lawyer was a lawyer who argued pivotal voting right cases for the kennedy justice department. in 1963 in mississippi, john stepped between angry protesters and armed police to prevent a potential massacre after the murder of medgar evers. that was the kind of lawyer and later he was. years later he gave me a photo. our nation's greatness is not a birthright, it must be earned by every generation and i am confident that we can earn it for this time.

we are at our best when we live our values, including our to motion to democracy and protection, under the rule of law. that that isongly what is called for today. there is no group that i have more confidence in being able to rise and meet that challenge than the lawyers of america, and particularly the american bar association. thank you all very much. [applause]

>> tonight at 6:30 p.m. eastern time we will have the town hall meeting from emily's list, electing the -- electing a woman as president. here's a preview. this may be semantics, but how do we make women's issues men's issues? issues,ic platform independent, it seems to me that we are still locked into partisan arguments. >> i would not be here if it weren't for independent voters in missouri. it is about one third, one third, one third. there is 30% that would not vote

for me no matter what and there is a third that would vote for me no matter what. there is this middle. most of those folks in the middle are perfectly willing to vote for a republican or a democrat. they like compromise and moderation. i do think that one of the things we need to do is make withwe are communicating independent voters across this country. we have put on our hats of being a political party first. we are going to lose voters. we have a wonderful opportunity in this country. the shining objects in the republican party do not translate well to and dependent voters. they translate very well to the republican party. you and i know this very well. their caucuses are famous for picking the republicans that are not anywhere near the middle. [laughter]

really that is an opportunity for us. if we continue to talk about the issues that most americans care about -- can i afford to send my kids to college? and my going to have a retirement? is there healthcare? is that bridge safe, can i drive over it? issues is what she want tout. these are what we are focused on. long as we talk about those we are going to get more voters then ted cruz, rand paul, and all the todd akin wannabes. [applause] hall will show the town meeting in its entirety tonight at 6:30 p.m. eastern time right here on c-span.

president obama's occasion in martha possible inured is ending today. -- in martha's vineyard is ending tonight. be talking about his proposals for helping the middle class. representative jim hems erlang, he is the chairman of the -- jeb hensarling. he was a keynote speaker at the policy center. he this is about 40 minutes. [applause] >> thank you mr. secretary for the kind introduction. i don't know if you can see me, this is a rather large podium. it reminds me of what i frequently tell my washington colleagues -- everything is bigger in texas but me. if you can't see me, you can at least hear me.

i was delighted to accept the invitation to speak before the bipartisan policy center for a couple of reasons. number one is because of the outstanding work you have done in the housing arena and number two, i live about re-miles from here so it took me about seven minutes to get here. as a fairly new chairman of a standing committee of congress, i have a number of speaking invitations that come my way. a lot of press is interested in speaking to me me but i assure you, i don't have to work to remain humble. i accept the number of them and my home, i was working on one of those speeches after dinner and my wife who helps keep me humble, comes into my study and says -- ok, in washington, you made me mr. chairman but in

dallas, you are mr. dishwasher and they are not getting any cleaner. i took my wife's subtle hand and dropped the speech and went into the kitchen and began to work on the dishes. a few minutes later, the phone rings and she picked it up and comes into the kitchen and says come co mr. big shot, "the wall street journal" on the phone. i was wondering how they got my home number but i would rather talk about quantitative easing then washing the dinner dishes. i picked up the phone and said this is jeb. they asked if for $29.92 a month [laughter] i assure you, that will indeed

keep you humble. something else that will keep you humble is trying to reform our nation's housing finance system that is something i believe is vital to every homeowner current and would be, vital to every taxpayer and the future of our economy. if you did not understand that, you would not be in this room today. i want to thank the bipartisan center for the work at has done on housing reform. it is very important work and i especially want to recognize the outstanding leadership and service of people like secretary martinez and secretary cisneros, the latter secretary being a fellow texas aggie. as i reminded him, he is a temporary resident in san antonio in the early 1980s and my former mayor. i want to thank both of you gentlemen for continuing in this

facet of public service. i thank you for the solutions you support for our nation's housing challenges. i also want to thank the center for the work they do in promoting a respectable and constructive dialogue on what is typically a fairly contentious issue. we know that in washington, it occasionally sheds more heat than light. i hope that today we have a little bit more light and i am flees to be a part of that dialogue today. as some of you may know, i have focused a good portion of my public service career to the issue of housing. i believe homeownership is a cherished american tradition. it is a tradition that i believe is far more meaningful than granite -- granite countertops.

it is a quality that combines families together, build financial security and strengthens our communities. as cherished of an institution as it may be, homeownership does not in and of itself constitute the american dream. it never has. i think most of us believe the american dream is something far more profound. quite simply, the right to use our god-given talents to control our own destiny to the end, that our children might have even greater opportunities, greater abundance and greater freedoms than we have ever enjoyed. it is this understanding of the american dream that serves as my personal composition this debate. before we can use any compass to help chart a path for the future, we must have a thorough

understanding of where we have been and where we, unfortunately, find ourselves today. for my work on the congressional oversight panel for the tarp program, it became clear that the great tragedy, the financial crisis was not that washington failed to prevent the crisis that that washington helped lead us into it. we were led into it based upon a single good intentioned -- that every american family should own a home. good intentions do not necessarily lead to good public policy. washington helped lead us into this crisis in three principal ways. federal policies expanded policies by encouraging lending to people who bought homes that they simply could not afford to keep. sadly, the federal government

that lives beyond its means tragically encouraged american families to do likewise. washington promoted moral hazard by protecting fannie mae and freddie mac which privatized their profits and socialized their losses. lastly, the federal reserve maintained a highly accommodative monetary policy that traumatically lowered interest rates and kept them low and inflated the housing bubble. let's hope history is not repeating itself currently. the fed set the stage for a wave of mortgage our wing by setting borrowing conditions too low too long. the fed began lowering interest rates in early 2001 to cushion the economic fallout. on an inflation adjusted basis, the fed dropped interest rates from four percent in late 2000 28 negative one .5% by early 2003. that decision unleashed a wave of cheap credit on a housing market that was already

experiencing a down cycle. if the federal government has attempted to spur lending and are owing to expand homeownership without direct taxpayer spending and without annual congressional approval. i believe and there are those that disagree that one of the more damaging initiatives has been the community reinvestment act which is clearly undertaken with good intentions but i feel is antiquated and in need of repeal. proponents of bandits have said that a small portion of subprime mortgage origination's related to the cra. i believe this is a more fundamental point - cra loan mandates remain large in precedent. they require lending institutions to abandon their traditional underwriting standards to comply with this government mandate. cra put the government's housekeeping seal of approval on low-quality loans. finally, fannie mae and freddie mac -- private companies awarded monopoly powers by congress in exchange for meeting certain affordable housing goals. they exploited those chargers

tube ro at discounted rates and ultimately dominated our secondary mortgage market. bait wildly inflated their balance sheets and personally and rich their executives via explicit government backing. i'm -- did i mention the cook looks that allowed the connected executives to make off like bandits was what their regulator described as ill-gotten bonuses in the hundreds of millions of dollars? given their prominence in the market, investors and underwriters came to believe that if fannie mae and freddie mac touched a loan, it was safe, sound, secure, and sanctioned by the government. more than 70% of subprime mortgages that helped lead to the crisis were backed by fannie mae, freddie mac, fha and other

taxpayer-backed programs. if you have to put your finger on the root cause of the crisis, this is it. despite the inherent dangers in such transactions, fannie mae and freddie mac supporters kept encouraging them to roll the dice a little bit more. they did and the result is the worst financial crisis since the great depression. the ultimate consequence of these policies with that the average american family watched helplessly as their net wealth declined i nearly $50,000 wiping out nearly two decades of financial progress. ladies and gentlemen, this is where we have been. five years later, where do we find ourselves today? today, we know there are single moms throughout our economy to our having to work even harder than before simply to put food on the table, to. put a roof over their families heads that is unconscionable. today, taxpayers have been forced to pay for the mother of all bailouts, nearly $200 billion for the failed gse's. that is unimaginable. taxpayers remain on the hook for nearly five trillion dollars in mortgage guarantees, roughly 1/3 the size of our economy, that is unfathomable.

the federal government has a virtual monopoly on the housing finance system, that is unwise. due to the dodd frank act, washington elites decide who can qualify for mortgages putting ownership out of reach for millions of creditworthy american families. that is unfair. the american people deserve a path forward, they deserve a path to a housing system that is sustainable, fair, and preserves the american dream. they deserve a system that protects current and future homeowners so that every american who works hard am a plays by the rules, can have opportunities and choices to buy homes they can actually afford to keep. they deserve a system that protects hard-working taxpayers so they never again have to they'll out corrupted financial

institutions like fannie mae and freddie mac. they deserve a system that finally rakes the distractive boom/bust housing cycles that it hurt so many working families and bought our economy to its knees. that is why the house financial services committee recently approved hr 2767, the path act which stands for protecting american taxpayers and homeowners. i believe the path act is the path forward. the act as the principal work of scott garrett of new jersey. i commend them for their principles to bring this landmark legislation to our committee. at its core, the housing market is not fundamentally different from the market of any other asset. housing is not immune to the economic laws of supply and demand or risk and reward. the path act principally relies upon private capital and market discipline. it includes quite -- or

fundamental goals to the development of a competitive free market. first, the role of government is clearly defined and limited. second, our official barriers to private capital are removed to attract investment and encourage innovation. third, market participants are given clear transparent and enforceable rules for transactions to foster competition and restore market discipline. lastly, consumers are afforded informed choices in determining which mortgage products best suited her needs. the act specifically ends the costly fannie mae and freddie mac bailout, it protects and restores the fha by defining its mission come it increases mortgage competition, and enhances transparency and maximizes consumer choice, and breaks down barriers for private investment capital. many believe, as i do, that the first step in creating a sustainable housing finance system is to and the costly

bailout of fannie mae and freddie mac. we need to permanently move away from a system where the fate of our economy depends upon their success or their failure. the path act and the bailout and gradually winds down both failed companies over a 5-7 year time frame. much of this debate has centered around these so-called need to have gse's or their equivalent in error eyes -- housing finance system. we should recognize that the u.s. is tactically alone in the modern industrialized world in having government sponsored enterprises directly guarantee mortgage securities. we are practically alone in our level of direct government subsidy and intervention in our housing markets. we were also practically alone in the world in the level of turmoil in our housing markets as measured by foreclosures and delinquencies.

i believe there is a direct causal link. fannie mae and freddie mac have not propelled our nation to housing finance nirvana. when compared to other modern industrialized nations, whether we look at rates of homeownership or spreads between mortgage interest rates and sovereign debt, the u.s. can typically be found either in the middle or the bottom of the pack. however, there is one category where the u.s. has clearly led, foreclosure rates. only in america, can you find a government that subsidizes housing more so that we the people can get less. we do not have to look overseas to see a well functioning housing market without government-sponsored enterprises. we don't have to look any further than our own jumbo market that has successfully operated without them. prior to the housing bust, the jumbo market was 20% of our total housing market. there was capital, liquidity, [inaudible] competition, eight 30-year fixed mortgage choice and innovation all right here in america.

all of that was delivered for about 7-20 basis points from what the gse's offered. i would offer a modest amount to avoid taxpayer bailouts, government control and economic catastrophe. i think it is important that whatever modest interest rate benefit the gse's delivered to home buyers, to some extent, it was clearly offset by the inflation of housing principles for the very same home buyers. in other words, it is not self- evident that the homebuyer was any better off. at the end of the day, the best argument i have heard to perpetuate the gse's are the following: they were standard setters throughout the underwriting purchase requirements and served as loan aggregators for smaller lenders by purchasing loans through their cash window and they provided a conduit for smaller originators to access mortgage investors through the issuance

of mortgage backed securities. these are indeed functions well worth preserving in some form throughout a new system. the path act ushers in a new system of housing finances separating these functions, providing clear and transparent disclosure of mortgage data and giving certainty to contracts and enforceability, utilizing the knowledge and networks of the federal home loan bank system and creating an open access utility per mortgage backed securities issuance that is decoupled from the holding of the long-term mortgage risk. to ensure a smooth transition to the new system, the path act implements several reforms to fannie mae and freddie mac. these reforms include repealing their misguided washington created affordable housing goals that helped precipitate the crisis. shrinking their portfolios of mortgage-backed securities and other assets and eliminating the government granted competitive advantages over the private sector. the path act reforms the fha. you cannot have true housing

reform without fha reform. otherwise, you are simply squeezing the balloon on one side only to have it bulge on another. regrettably, the fha is not only broken but it is bail out broke. it has experienced severe mission creep and i would argue that phenomenon are directly related. stead of helping those it was intended, fha insures mortgages for millionaires and homes valued as high as $729,000. that is a mansion and most of the fifth congressional district of texas and far beyond the reach of those truly earning low and moderate incomes. the fha government privileges given advantages that muscle out private competition. it is no wonder that fha today

controls 57% of the mortgage insurance market. it has gained this advantage over competitors by using many of the same practices employed by subprime lenders, small down payments, low credit scores, cheap upfront pricing, and encouraging the purchase of increasingly pricey homes. fha has more in common with the now-defunct countrywide than with the fha of years ago. the path act returns it to its traditional mission helping first time wires and low and moderate income families. it further helps ensure fha solvency. a bankrupt fha helps no one. rest assured that in times of serious economic downturns, under the path back, the fha can insure loans to any borrower. this means the path would preserve the fha's existing countercyclical role in mortgage lending which enables the fha to serve as a backstop to keep mortgage credit flowing, promote stability in the housing market,

and ensure middle of income families can buy homes. it allows for a new but old method for banks to finance mortgage lending by creating a regulatory framework for covered bonds financing. i say new but old because covered bonds have existed and have been successfully used in europe for more than 200 years. they offer a third pathway to mortgage financing beyond traditional portfolio lending and securitization. when it comes to housing finance, many in washington fight the new and defend the old failed status quo that gave us a government run monopoly, taxpayer bailouts, economic crisis, and delivered only mediocre homeownership rates. but detractors of the path act have claimed it will eliminate the early year fixed rate mortgage. that could be the biggest myth about the path act. in fact, section 213 of the path

act specifically states that " the fha shall provide, among other mortgage products, for the availability of a 30-year fixed mortgage." legislation does not say fha can provide or may provide or should provide and instead says shall provide. i would note that section 213 would be the first time that the fha has ever been specifically required to offer a early year fixed rate insurance product which would conclusively refute that argument. some people have stated that the very existence of the 30 year fixed-rate mortgage is due to the fha. if so, the path that goes to great lengths to strengthen it for future generations by granting it meaningful autonomy from hud defined in its mission and helping make it solvent and

giving it more flexibility to manage looks. 30 year fixed-rate mortgages existed before the financial crisis without a government darren t and they are being made today without a government guarantee. " the washington post" said the lack of permanent government backing will deprive the market of liquidity and and 30 year fixed-rate mortgages. my answer to that is that some 30 year fixed-rate loans exist without government help. homebuyer should have the opportunity to acquire a 30 year fixed-rate mortgage. it is important to many americans. washington should not steer people into it but instead should ensure that our citizens have informed choices about an hour rate of mortgage products that could meet their needs. as the head of the federal housing finance agency recently stated " one thing i would say about 30 year mortgages, it is not necessarily the best mortgage product for a homebuyer, especially a first

time homebuyer." if you look at statistics, first-time home buyers tend to own their first home for four or five years so it may not be the best for their circumstances if they buy that house with that kind of timeline. or maybe a different mortgage product in which they can build equity at a faster rate than a 30 year fixed-rate mortgage" even president obama has a knowledge that shorter duration loans hold advantages for many are words like when he proposed last year and expanded loan refinance program where borrowers " must agree to refinance and weight loan with no more than a 20 year term." many americans who seek to own a home find themselves selling their property before they'd build some if any equity in that property. that leaves their situation akin to being a renter who pays thousands in closing costs, agrees to do the maintenance, and then has to pay the property taxes.

there is no one-size-fits-all mortgage in america. some opponents of the path back claim that sufficient private sector capital simply does not exist to fill a post government guarantee void. why are equity markets 2.5 times the size of our mortgage markets and yet they exist without any guarantee, government or otherwise? how much capital is sufficient for housing finance? i don't know the answer to the question and i suspect no one in this audience does either. what i do know is that whatever that number is, it must be sustainable. that is the key concept. i would remind us all that capital has alternative uses. every dollar that washington artificially puts into mortgage

finance is a dollar that can no longer be used to promote math tutors for our children, or promote our economy manufacturing sector to give them jobs once they graduate. another important factor to remember about financing the u.s. mortgage market is that investors, property and casualty life insurers, pension and retirement funds, ritual funds and real estate investment trusts, elbow most 50% of the market share for whole mortgages and mortgage-backed securities by 2010. for these kind of investors, the u.s. market was an ideal investment opportunity given their need for long-term investments. one housing expert explains that winding down the gse should be accomplished without any major stress in the flow of funds for u.s. mortgages. if we look abroad, we see another modern industrialized nation that has avoided our disastrous gse experience.

private capital is willing ready and able to fund the mortgage market. another attack made against the path back is that it will be harder for middle income families to buy homes. no, that distinction belongs to the frank act. a chief mark zandi testified that one single dodd frank rule, qrm, could increase mortgage interest rates 1- 4 percentage points. a company that analyzes information set about half the mortgage loans made today would not qualify with dodd frank rules that go into effect this january. in other words, single-handedly,

the dodd frank act could cut the number of mortgages in half and double the cost of those that remain. it is that bad. perhaps, that is why the national association of homebuilders says dodd frank and grind the system to a halt. because of the dodd frank act, washington has more control over who can buy a home than your local banker. the path act addresses these devastating rules head-on, getting washington out of the way to allow banks to lend, builders to build, real close to sell, and home buyers to buy. the path act entirely eliminates the qualified residential mortgage issued by striking the dodd frank credit risk retention requirements in prohibiting federal agencies for requiring risk retention or premium catcher reserve accounts. it eliminates the troubling ability to pay liability

exposure for lenders for the mortgages they are willing to hold in their own portfolio or securitized through the platform created by the path back. i know that some have claimed that somehow the path act is ideological. that is a word you hear more in washington. it seems to me that those who would defend a failed status quo of taxpayer bailouts, economic crisis and mediocre homeownership rates, perhaps these are the ones that are being ideological. instead, the path act is sustainable, sustainable for home owners so they can buy homes they can actually afford to keep and sustainable for taxpayers so they no longer have to bail out housing finance system, sustainable for our economy so that we avoid the seemingly never ending cycle of boom and bust in our housing market. perhaps in washington, that is ideological but in the fifth congressional district of texas, i think it is known as common sense. i have spent a lot of time listening to my constituents and their common sense. i recently heard from diane in dallas who wrote me " why should those of us who did the

responsible thing and purchase homes we could afford have to pay the freight for those bought larger more expensive homes they could not afford?" i heard from steve in jacksonville, texas -- " if it were a mom-and-pop business that did with fannie mae and freddie mac did would have been shut down for border -- for poor business practices and jailed." then scott wrote me -- " what the american people need is not more washington regulations or subsidies, just give us the opportunity to buy a home that people can afford to keep so we can live and raise our families." people outside of washington get it. they understand that the system in place today is too often unfair, unaccountable, and unsustainable. clearly, i know there are other voices in this debate besides my own and my constituents and i could not be more gratified that

last week at the president finally his voice to this important debate. although i heard few specifics, i welcome him to the debate. i am encouraged by this and i recognize that he is indispensable to a solution. other important voices in this debate besides your own are those of senator corker of tennessee and senator warner of virginia. i commend them for their leadership as someone who has worked for years and years on the complicated and contentious issue of housing reform, i salute anyone who will roll up their sleeves and produce not just rhetoric but an actual plan. even today, more and more voices are being heard in this debate and this is encouraging. this is good. i stand ready to listen to all and negotiate in good faith with all. i do this with an open mind but i do not do it with an empty mind.

thus, i remain skeptical and fearful of an approach that does not and the permanent government guarantee in the secondary mortgage market. if taxpayers are still on the hook at the end of the day, i fear all you have done is put fannie mae and freddie mac and the -- in the federal witness protection program and given them a new identity and unleash them on an unsuspecting public. the government provides guarantees and it means investors who buy mortgage- backed securities and will be protected against loss. they will not be concerned about the quality of the mortgages. either way, they will get paid and not unlike fannie mae and freddie mac, it could well perpetuate a system where wall street investors simply offload their risk onto main street taxpayers. such a system, i fear, can guarantee that america will face another round of boom, bust, and bail out. new federal bureaucracies would approve players in the system. i fear the prospect of powerful

bureaucrats taking -- picking winners and losers and that system, the taxpayer comes out the loser. cronyism has a way of rearing its ugly head. i remain skeptical of ideas to create a new federal mortgage insurance fund. there is one thing we have learned about government and insurance funds is that the government either cannot or will not properly price for risk. you name it -- whether it is the national flood insurance program touches underwater, pun intended, the pension benefit guaranty program or even the deposit insurance fund, from time to time, the government has flat gotten it wrong leaving taxpayers on the hook. i will conclude with just these last few thoughts -- as our nation charts a half forward on housing reform, some will say our public rosy choices for working american families are between house and no house. i disagree.

to have a sustainable housing policy where people buy homes they can't afford to keep, the choice in many respects is between house and morehouse. our general -- will our generation perpetuated system that the man's morehouse today to ensure that our children are confined to less house tomorrow? today's system is retarding economic growth and helping fuel what all acknowledge is an unsustainable level of national debt. our spending driven debt crisis is the greatest existential threat facing our nation today. we are borrowing $.31 on the dollar, much of it from china, and sending the bill to our children. children born today are burdened with a debt of more than $52,000 they had nothing to do with creating. our national debt stands at roughly $145,000 per household.

for many people i represent in the fifth congressional district of texas, that is more than they will ever amass in savings in their entire lifetimes. david cody, a presidential appointee to the simpson-bowles commission, and the ceo of honeywell said " the seeds of the next recession have been planted and the debt burden over the next 10 years will sink us." the former chairman of the joint chiefs of staff said the singles big of threat to national security is ever debt. i would offer the single biggest threat to our national housing aspirations, too, is ever debt. if you have ever attended one of our financial services committee hearings on capitol hill and i hope one day you will, you will also see that we run a continuous real-time display of the national debt clock. it serves as a constant and sobering reminder of the very

serious and very dangerous threat that faces our nation. it is a threat that looms large over this debate and should loom large over every debate we engage in. i would also say that as we think about a housing program for working americans, we've got to remember that the best housing program is not a subsidy or guaranty or interest deduction or a tax credit. it is a job. it is a job that leads to a rewarding career in a dynamic, growing economy because there has never been a greater or more successful housing program ever devised by the minds of mankind than the american free enterprise system. this is what we should work to strengthen. we should also never forget that at the dawn of american history, it was another crony run sponsored enterprise that needed a bailout, namely the east india tea company.

it sparked a revolution gave birth to a nation teeming with individuals who decided to take control of their own destinies. these patriots risk their lives, fortunes, and sacred honor to ensure their children would have something better and afraid they've risked it all for the american dream. that is a compass that should guide us all. in the aftermath of the destruction caused by an unsustainable housing finance system, we find ourselves again at another moment in history. it is a moment in history when we have to make a fundamental choice, one that will shape the future of our nation and the ones we proudly call america home. that is why this debate matters. when you come down to it, it is not a debate about basis points or fixed term loans. it is about freedom. it is about opportunity. it is about taking back control

it is about taking back control of your lives and your destinies including many here today, you, who have career in housing finance, to have those careers without the interference of big government. i hope we can all agree it is time for a new path. it is time for our generation to preserve for our children the american dream including that most important dream of homeownership. i welcome your voice and i thank you for the opportunity to speak to you today, thank you. [applause] >> thank you so much for very thoughtful remarks. i know we are running close to our timeframe for lunch. i will throw a question at you and maybe a second one -- one of the things everyone would like to know is what is your assessment of a timetable by which that which we all share which is the desire to see this reform take place could happen?

>> you did not say they would be easy questions. the house majority leader is anxious to ring the path act to the floor. i have an open mind. we are speaking to many people now about some revisions and improvements that could be made to that act before it goes to the floor. as i look in this audience, i see a few of those people we are talking with as we speak today. i do not have a close personal working relationship with senator harry reid so i am a little ignorant of what the time table may be over there but in my discussions with the senate banking chairman , tim johnson, and ranking member mike crepo, i am cautiously optimistic that they too may move some legislation in the fall. i believe as does the majority

of the house financial services committee that the path act is the path forward. the voters spoke in the last election. there is divided government and that is why god made conference committees and i wish to get the path act to a conference committee. >> as someone who was in the senate for the better part of a term, i only saw one or two conference committees the entire time i was there. that would be welcome news to those who study civics in our schools that we could come together. i guess that would be the follow-up question -- do you think we could end up in a conference situation? with the senate agreed to that as well as the house leadership? >> to the extent i have anything to say about it, we would go to conference. i've got a nine-year-old son, an 11-year-old daughter learning about civics and i hope it is

not relegated to myth, these ideas of having an actual conference committee. i would remain cautiously optimistic. i am more encouraged now that the president has weighed in. i was encouraged when the president's administration initially put out their housing white paper. i became discouraged when it was allowed to gathered dust for roughly 2.5 years. there were a number of conversations with secretary geithner and i was convinced by the sincerity of wanting to move forward and why it never happened. i don't have a clear picture. i am encourage the presidente is weighed in. he seemingly wants to get something done and option one on his housing white paper, to a great extent, encompasses much of what the path act as. i list to his comments carefully the other day. his wind down for fannie mae and freddie mac is similar to what we see in the path act. having said that, i have frequently, in my career, found myself agreeing with 80% of what the president says.