through the federal court's electronic case filing and that's not applicable to the states. >> thank you, mr. chairman. >> thank you. either mr. rothen berg or ms. leery. if federal charges are brought, many victims request protection. if someone requests protection during the proceedings, what happens? . .

it would because i would point out that it is only one of the ways we help victims. for example, you may be aware that under 42 u.s.c. 1060-07 we have obligations to the victims including protection, including notice of what's going on in the investigation and the status of the case. so we provide a full range of services to victims, potential victims, even prior to an indictment throughout the course of investigation and prosecution. it's a little bit of -- we shouldn't focus too much on simply the cvra. >> you indicated problems in sentencing under victim impact in a particular sentence. the judge ruland inadmirable

and struck -- the judge ruled ined a hisible and struck it. i thought that it would not have to be specifically related to the case, is that what you're arguing on appeal? that if you have a victim they have the right -- and they have a right to testify it doesn't have to be targeted just for this? they have other kind of conduct related? >> in the particular case at issue, it's a possession case of child pornography and what the judge said was that the victim impact statements were not relevant to the conduct charged. i think that you -- >> you mean pleaded guilty to? >> that he pleaded guilty to. i think it's a good point you raised, but we want to -- we want to establish the fact that the victim -- the statement of

the victim is in fact relevant because the possession of child pornography is part of the demand for the sexual abuse that occurred. and so we're establishing the fact that the child in these circumstances was in fact a victim of the crime. >> thank you. a lot of people have kind of gone back and forth about when the rights under this act begin, whether they begin at indictment, preindictment, whether you need charges to actually file. ms. leary, you indicated a situation that sounds like the terrorist situation, sounds like the assistance was provided even before charges was brought, is that right? >> that's right. as mr. rothenberg said, the department of justice works with victims in a variety of ways. and many of those ways involve preindictment assistance to the victims. my own personal experience as an assistant u.s. attorney in

d.c. is that we provide services to victims at every stage. and you can't meet all the needs but you do your very best to do so. >> now, some of the needs that you are describing seemed unrelated to court proceedings. are we able to provide those kinds of services on a routine basis? >> we are not able to provide them on a routine basis. this is a very extraordinary case, and in many cases we do make referrals for services, so it's really incumbent on the prosecutors to and the victim witness assistant offices to know the community resources that are available and to help connect victims with those services. so while you are not providing them yourself you are making an appropriate referral and kind of connecting the dots for the

victims. >> and the final question is to simply whether or not providing assistance to the victims has at all complicated the prosecution of cases? >> providing assistance, does it complicate prosecution? >> compliance with the law, has that complicated the prosecution? >> i would say that it is an additional duty that our prosecutors have to and our investigative agents have to take. but to the extent that it is required more effort it's one that we fully accept upon ourselves as part of our obligations. >> it's provided more efforts. but you can see in some cases if it's a request for a timely trial before you're per paired -- prepared, for example, have you seen any complications in prosecutions? have you been unable to aggressively and prosecute

defendants because of any compliance with this law? i just say one of the arguments against the constitutional amendment is that you're impended upon defendant's rights. and i guess my question is whether that's theoretical or real? are you unable to prosecute people because of compliance with this law or any rights of the defendants compromised because you have to comply with the law? >> there are certainly circumstances where finding the right balance in the course of a prosecution between our obligations to the constitutional rights of defendants and the rights of victims does happen and we do our best to work through those. >> ok. like what? like what? do you have some examples? >> i can't think of some examples. >> if you can provide some, go and ask u.s. attorneys whether

or not there have been any complications arising -- has the law complicated -- other than they have more work to do, do you cure that with funding for staff and whether or not there's been any compromising of their ability to do their jobs because they have to comply with the -- with the act, whether it's complicated the prosecution at all, whether -- you can't impinge because it's a statute, you can't impinge on defendant's rights, whether or not there's been any complications that has arised? the gentleman from texas. >> mr. rothenberg, ms. howely mentioned there were cases where the victim was not notified prior to charging when a plea bargain worked out. are those cases where the u.s.

attorney offices working with some cooperating individual and working to get someone else? >> i believe that's one example. i believe that's correct. there are circumstances in which a preindictment plea agreement is in the best interest of all the parties involved in order to successfully conclude a prosecution. and sometimes it's not possible to provide preindictment notice to the victims. >> and one other comment that she made, do you think congress needs to clarify as to when these rights actually take effect, preindictment, at indictment or someplace, do you think cock has that responsibility to make it clear to everybody? >> well, as a number of the witnesses have said, we have taken a position regarding that in terms of the policy matter as to whether the law should be changed, we're happy to work

with the subcommittee on it. >> ok. you'll follow whatever it is. ok. other in an money which in my opinion is appallingly low for this legislation -- embarrassingly low in how little money is applied to this act, what is one thing each of you would like to see now five years down the road, here we are five years since the legislation was enacted, to improve the law in any aspect, other than money, would just go down the row, ms. larence? >> in our report we identified a number of things where the court is trying to interpret some of the provisions of the act. there is not a body of case law. so we did not take a position on whether or not congress needs to change the law to address those issues. and the one case we did, though, it was pretty clear from all those involved, they

would like the congress to clarify how the law applies to the district of columbia. >> ok. mr. rothenberg. you're satisfied with the way it is? >> the department of justice is fully committed to enforcing the crime victims act and we believe we are doing our best efforts now and we look forward to working with the committee on any changes that you deem appropriate. >> ok. ms. leary. >> i would recommend that each specific changes to the staff -- i do hope and i expect that as time goes by the awareness of victims' rights, the importance of protecting them and the mechanisms -- the legal mechanisms available to victims will become more and more widely recognized and utilized. and i do think we will see that happen.

we've seen that in other areas of victims' rights. >> professor? >> standard of review. can i have two? >> yes. since they didn't have any you can have one for each one of them. >> standard review and the concern as ms. howely mentioned, making clear that victims can access certain of these rights prior to indictment. >> and i would like for you to turn that information over to the chairman regarding those statistics on review, whether it's appeals or whether it's mandated. >> i can tell the chair there are no cases under the cvra has found that the cvra violates criminal defendant's rights. >> ms. howely. >> let me say this, i would not be surprised about that because it's a statute and not a constitutional amendment. and i think that's one of the

reasons we want it to be a statute. thank you. >> ms. howely. >> along with the points that i already raised in my oral testimony, i believe that the most important thing is to make the department victims rights compliance program effective. the g.a.o. report went into that in great detail. the placement of the office and the current procedures are inadequate for the enforcement of victims' rights. we've seen at the state level that the existence of a meaningful compliance program makes all the difference even though sanctions are rarely used. just the existence makes people take the training more seriously, makes them pay more attention to the protocalls and the implementation. it's my understanding that the working group is making changes on the victims rights ombudsman office. >> i want to thank you for your support on victims. they don't have a high dollar

lobbyist in washington, d.c., so it's people like you that look out for them. thank you. i yield back, mr. chairman. >> the gentleman from virginia, mr. goodlatte. >> thank you, mr. chairman. i have no further questions. >> i have one question. does each u.s. attorney have a victim witness coordinator? in each u.s. attorney's office? >> yes. every u.s. attorney's office has a victim witness. >> and in the eastern district of virginia where you got an alexandria, richmond, norfolk office, would there be one in each office or one for the whole district? >> i think in virginia each one does. i can't be sure but we'll get back to you on that. i guess i should direct it. almost every single office has a victim witness coordinator. there are really some small field offices out there, but most -- the vast majority do have victim witness coordinators. >> and, mr. beloof, ms. howely, how effective are these

coordinators? >> well, i think they're pretty effective. i think their hearts and their professional commitment is largely in the mission. so i think it's a good thing, and it's good that they're in those offices. they are, of course, not attorneys. they're people who work for the attorneys. so it's a bit of an awkward relationship. >> well, one of the things that we have to recognize is some of this is labor intensive, coordinating, letting people know and taking the time to treat people with the dignity that you would expect in a court system takes time. and if you have somebody whose job is just that, the job of u.s. attorney with a stack full of files may cut people a little short, but if you have somebody whose job it is to take some time and describe when the hearing is coming up,

when to show up, what to expect, that could be helpful if you have enough of them. >> exactly. i would say that the victim witness coordinators and also at the investigative stage the victim assistants are what make victims' rights workable for the criminal justice system. >> thank you. i'd like to recognize the gentlelady from texas, do you have any questions, ms. jackson lee? i think we're done. >> thank you very much, mr. chairman. i just landed so i thank the witnesses for their testimony and i wanted to make sure that at least represented to all of the witnesses to my interest in

this area. and let me ask susan howely who is for the national center of victims of crime. it may be repetitive and let me apologize to you but let me make this bearing question, if you will. as to the major legal legislative need and fix that the victims do need in making sure that they are counted in the sentencing process, that they are compensated and what kind of federal laws are needed contrast to the state level. i know that the state of texas has an adequate compensation process. >> i would say that creating a meaningful compliance program or a meaningful avenue to enforce victims' rights is the most important thing that can be done. the cvra has taken a number of

important steps in that direction with the clarification of the applicability of the enforcement procedures to cases brought in the district of columbia superior court and with changes to the department of justice's victims' right ombudsman. the federal system could be a model for the states as many of whom do not have enforcement programs. >> so do you think the federal system needs to be enhanced to emphasize or fill in the gaps where states do not have a meaningful program? >> no. the federal system could not be expanded to enforce these state victims' rights. >> but to step in where there are no state victims' rights structures, the states that do not have them? >> right. the states will have to create their own enforcement proceedings unless we went to a federal victims' rights constitutional amendment, then the federal system could step

in and help enforce victims' rights at the state level. >> so what do you think should be the effort in encouraging states since we think it is a priority to emphasize their own structures? >> the first step would be to use the funding authorized in the cvra to promote compliance or promote the enforcement of victims' rights in the courts to fully fund that grant program. >> and what do you think and how do you the victims' rights program are treating children who are victims? is there sufficient protection for them? in the process? >> victims' rights generally attach to the parent or guardian of a minor victim. there are other rights outside of the cvra and outside of standard bills of rights that provide alternative procedures that facilitate the participation of child victims

and witnesses and protect them. >> thank you. professor beloof, would you like to comment on whether the structure that we have as it relates to victims who happen to be children and if you have any contrary views about this victims' rights structure? >> the cvra in relationship to children is drafted so that let's say the parent is the perpetrator, the court can appoint a different representative for that child or counsel for that child. so we were conscious of that at the time it was drafted. in regards to your other structural question, the idea in the statute at cvra was to use this funding to create

incentives in similar states to come up with this scheme, that is to serve as a national model. it stands as the most progressive, forward-looking civil rights provision for victims that exists. without the funding, and that's a central problem we've been talking about here. there's little funding. there's little incentive for states to change. i was involved in my own state's change probably because i was there and had a relationship with the attorney general. now, we have enforceable victims' rights. i was fortunate enough to be engaged with a person who had substantial assets who funded a similar kind of change in california. but to my knowledge since the cvra was enacted and with this limited funding, those are the only two states that have tried to emulate the federal model in the last five years.

>> let me cha the chairman and the ranking member for this hearing. i think what i'm liening for two witnesses, it might be -- leaning for the two witnesses, it might be we need to ramp up the voice for this legislation that would include funding. and we need to recognize as we look at some very difficult times in america, crime rates soaring, some going down in some cities which we recognize. no matter what level the crime rates are victims exist. and what comes to mind in particular is the city of chicago that's certainly had its share of crisis with respect to youth violence. so i do want to thank the chairman. it's something that we will look at i know individually. mr. chairman, thank you for your courtesies. i yield back. i thank the witnesses for their indulgences. >> thank you. the gentleman from texas. the gentleman from virginia. mr. goodlatte, do you have any other questions? i'd like to thank witnesses for their testimony today.

members may write questions for you. the hearing record will remain open for one week for this submission of additional materials. and without objection, the subcommittee stands adjourned. [captions copyright national cable satellite corp. 2009] [captioning performed by natonal captioning institute] >> the u.s. house returns at

6:00 eastern time. we expect debate at that time with motion to instruct negotiators on the fiscal year 2010 agriculture spending. includes, at 6:30, votes on bills from earlier. also this week, a measure that authorizes $1.5 billion for five years to aid pakistan. and possible debate on several conference reports. live house coverage when members return again that's at 6:00 p.m. eastern time. earlier today, the agency in charge of saving failing banks said it needs to raise billions of dollars from the banking industry in order to meet future deposit insurance needs. sheila baird shares the federal deposit insurance corporation. she and fellow board members talk about the new plan and the state of the banking industry for about half an hour. >> i would like to call this meeting to order. any questions or comments on

the summary agenda? may i have a motion to approve the summary agenda? >> i move. >> may i have a second? >> second. >> those in favor say aye. >> aye. >> the motion is agreed to. thank you. we have one item on the discussion agenda. it's a memorandum and resolution regarding special assessment, restoration plan and proposal for obtaining fund liquidity. >> good morning, chairman bair and members of the board. we're here to sure up the resources of the federal deposit insurance corporation by drawing on the resources of the banking industry. i'll spend a few minutes giving some background and then turn it over to diane to go through the proposal. to give a little historical

context, if you go back to the banking crisis of the laste 16980's and early 1990's, as a result of that congress took steps to strengthen the deposit system. and three of those steps are relevant to today's discussion. first, the fdic's commitment to protect insured depositors is backed by the full faith and credit of the u.s. government. secondly, the fdic is able to readily borrow from the u.s. treasury when it needs cash. and third, the banking industry is responsible for paying fully the losses that the fdic incurs as a result of bank failures and the fdic board has the authority to ensure that that happens. more recently in recent years congress has taken some steps to make the system, the deposit insurance system less pro-cyclical. and last october when our insurance funds, the reserve

ratio, the ratio of our fund balance to insured deposits fell below the lower end of the range we came to the board in october and proposed a restoration plan that would have the reserve ratio getting back within required period. we amended that proposal in february by adding proposed special assessments to prevent the fund from going negative if necessary. and then in may, the board finalized the current restoration plan, and as part of that it imposed a special assessment in the second quarter of five basis points on assets and gave the authority to do two more special assessments in the third and fourth quarter. and we're back here today to revisit that decision. since may, there have been some developments that are worth noting. first, the resolution activity, the number and assets of failures since picked -- has picked up.

secondly, the number and assets of problem banks have increased significantly. and that's an important driver in our loss projections. and then on a more positive note, there have been some positive signs. the -- i think it's -- there seems to be a consensus that the economic recovery is under way, and that's a good thing for our outlook. and at our last quarterly banking profile, there were -- while the industry earnings were negative, there were some possible signs that the rate of increase in credit quality problems is slowing. so i'll turn it over to diane to go through the proposals. it may be worth mentioning that both the presentation and the board case highlight the distinction between the fdic's fund balance on the one hand and the fdic's liquidity position on the other hand. and basically the fund balance

is simply the difference between the value of the assets that the fdic has and the liblets that the fdic has. and right -- the liabilities that the fdic has. and right now the significant liability that the fdic has is what we call our contingent loss reserves which is the funds set aside to cover the loss of failures over the coming year. rand so that's the fund balance. difference between assets and liabilities. for liquidity, that really gets to the mix of assets that the fdic has. we started this period with over $50 billion in cash and cash-like instruments. as a result of this resolution activity, some of that cash has been turned into liquid assets as a result of what we get from bank failures. so i think it's worth keeping that distinction in mind. with that i'll turn it over to diane. >> sure. staff has projected the fund balance in the reserve ratio for the near term as well as over the next several years using the most recently available information on

expected failures and loss rates. we expect through 2009 through 2013 the fund could incur approximately $100 billion in failure costs. most of it in 2009 and 2010. in fact, well over half of this amount will already be reflected in the september, 2009, fund balance. now, assessment revenue is projected to be over $06 billion over this five-year period which exceeds the remaining loss amount. the problem we're facing is that of timing. losses are occurring in the near term and revenue will be spread out into future years. now, the loss projections are subject to some uncertainty and actual losses could be higher or lower. this projection of failure costs is higher than our projection in may of $ 0 billion over the same time period due to the further deter yoration in institutions as reflected by the increasing number of problemmed institutions. nevertheless, we estimate the fund balance will be negative as of september 30, 2009, due

to an increase in provisions for anticipated failures. we have also estimate approximated fdic's need for cash to pay for projected failures. as art has already described, at the beginning of this crisis in june, 2008, total assets held by the fdic were approximately $50 billion and kansas citied almost entirely of cash in market security. but as the crisis has unfolded, lick wit assets at the fdic have been exchanged for less liquid claims with assets in failed institutions. as for june 30, securities have fallen to about $ 2 billion, and the pace of resolutions continues to put downward pressures on these balances. while the liquid assets in the fdic have value that will be converted to cash when assets are sold, our immediate need is to fund near-term failures. and if the fdic takes no action to increase its liquidity, staff projections show the liquidity needs will exceed

liquid assets sometime early next year. to ensure ratio to 1.15%, to meet the liquid its needs during a period of stress and to ensure that the deposit insurance systems remains directly industry funded, staff is making four recommendations today. first, staff recommends that the board has no further assessments on -- under the final rule adopted in may. we say that special assessments authorized under the final rule would not prevent the funneled from becoming negative and would impose a burden on a industry that is struggling to maintain positive earnings at all. staff recommends that the board maintain the assessment rates at the current levels through the end of 010 and then adopt a uniformed three basis point increase in rates effective january 1, 2011. also, we recommend that the

board extend the restoration plan to eight years. staff projects the failures will peak in 2009 and 2010 as an industry earnings will have recovered sufficiently by 2011 to absorb the three basis point increase. this schedule would return the fund to a positive balance in 2012 and the reserve ratio to 1.15% by the first quarter of 2017. one quarter later than the eight-year time horizon under the proposed restoration plan. however, projections that far in the future is subject to considerable uncertainty and the board could always raise rates later when the funds are recovered if necessary to meet the eight-year time frame. now, moving on to fdic liquidity needs. staff proposes that the board issue a rulemaking institutions to prepay on december 30 of this year their estimated risk based assessment for the fourth quarter of 2009 and for all of 2011, 2011 and 2012.

the needs would be resolved by the inflow of approximately $45 billion in cash from the prepaid assessments. however it will not effect the -- it will have deferred ref nufmente each institution would record the entire amount of the prepaid assessment as a prepaid expense, also an asset. and each quarter after the prepayment, an institution recording recollection spence for the regularly quarterly assessment until that asset is exhausted. if the assessment -- prepaid assessment is not exhausted by december 30, 2014, any remaining amounts will be returned to the institution. for purposes of calculating the prepaid amount, an institution's assessment rate will be the rate effective september 30, 2009, and will increase by three basis points in 2011 and 2012.

the proposed rule would allow fdic to exercise its discretion as supervisor and insurer to exempt an institution from prepayment requirement if they determine if prepayment mr. affect the soundness of the institution. they would transfer any portion of their portion of their prepaid assessment to any dess posit company and they would qualify for a zero risk weight. we believe this proposal for collecting cash to immediate liquidity needs have significant advantages ocompared to additional or higher special assessments. higher special assessments could severely reduce industry earnings at a time when the industry is in distress. we believe that the most of the prepaid assessment will be drawn from available cash in excess reserves which should not affect the current lending activities. in our view, requiring the institutions prepay assessment is also prmble from borrowing

from the federal government and thebacks. the dossity insurance system will preserve treasury and borrowing for emergency situations. however, we recommend that the fdic seek comment on these and other options in the n.p.r. we would be happy to answer any questions now. >> thank you. chairman. >> thank you, madam chairman. i mentioned to the chairman, i haven't been nervous at one of these board meetings since i attended my first one. with the number of tv cameras, this is -- my anxiety level is a little higher. i'll be brief. as we know, continuing bank resolutions have placed increasing pressures on the deposit insurance fund. staff projectses that the deposit insurance fund balance will be negative as of september 30. in addition, staff projected that the fdic's liquidity needs will exceed the liquid assets

on hands beginning in the first quarter of 2010. so the fdic board today is presented with two challenges. to address both the negative fund balance and the shortfall in liquidity for the fund. to address the negative fund balance, the board is proposing an eight-year restoration plan as provided for in the most recent connelly enacted legislation. to restore the d.i.f. to its statutorily required ratio of 1.15% by the first quarter of 2017. this restoration plan would maintain assessment rates at the current levels through the end of 2010 and thereafter adopt a uniformed three basis point increase in assessment rates effective january 1, 2011. to address the liquidity shortfall, the board is proposing to require all insured institutions to prepay on december 30, 2009, their

estimated risk based assessments for the fourth quarter of 2009 and for all of 2011, 2011 and 2012. staff estimates that the total prepaid assessments would be approximately $45 billion, sufficient to address the funds foreseeable liquidity needs. madam chairman, i am supportive of both proposals. the challenge here is to address the long-term and short-term financial needs of the fund while avoiding if possible imposing a pro-cyclical burden on the industry that could exacerbate bank failures and impact credit availability. i believe these proposals have a good prospect of achieving both of these goals. the restoration plan would restore the fund to a positive balance in 2012 and to the

1.15% reserve ratio by the first quarter of 2017 and does not increase the quarterly assessment until january of 2011 when staff proves that projections will allow for a three basis point increase. requiring a three-year prepaid assessment will bring in $45 billion in cash to meet the deposit insurance funds' foreseeable liquidity need to fund resolution while avoiding additional special assessments on the industry which could affect earnings and capital. the prepaid assessment would be expensed by the insured institutions over time so that the impact on their balance sheets will be the same as their regular quarterly assessments. this approach stays within the fdic's well-established assessment authority, should avoid imposing undue additional burden on the industry, it

maintains the industry supported nature of the deposit insurance fund. let's be clear that the they maintain authority to borrow up to $500 billion from the treasury so there's no question here of adequate resources to meet all of our deposit insurance obligations. lingt but we have here an option available to us that allows us to avoid borrowing and support the nature of the fund which on balance is desirable if we can do so without unacceptable negative economic costs which appears to be the case here. so, madam chairman, let me conclude by thanking you for your leadership on this issue and also by thanking the staff for the excellent work they have done here. thank you very much. >> thank you very much. director curry. >> thank you, chairman bair. i also want to thank you for your leadership on this very difficult issue.

i believe that any special assessments in the third or fourth quarters would be inadvisable when simply counterproductive. given current economic conditions and ongoing pressures on deposittory institutions. such assessments would be an exercise in the futility given the anticipated provisions given to the deposit insurance funds contingent loss reserve. consequently, i fully support going out for comment on the proposed n.p.r.'s restoration plan and its prepaid assessment system as an alternative to federal financing bank, for treasury borrowing. to me the anticipated liquidity needs for 2010 and beyond. the prepaid assessment proposal reinforces the notion, and this is i think very significant, that the d.i.f. remains a financial obligation of insured banks and that it is ultimately back stopped by the full faith and credit by the united states government. i have some longer term concerns, however, over the

restoration plan which i support. specifically the pleng of time it allows the d.i.f. fund balance to stay in negative territory and whether it's 1.15% reserve target is really where we want to be in 2017. while i understand that the board retains the flexibility to raise the regular assessment rates or to impose the special assessment in the future as circumstances change. i think it's important to get public comment on how quickly we should bring the d.i.f. fund to positive territory after economic conditions and bank earnings improve. once we emerge from the present crisis, i also think that the board and other policymakers need to re-evaluate how high the d.i.f. fund balance should be in good times to avoid the pro-cyclical impact on special assessments or higher regular assessment rates. in my view, the restoration

plan's target of 1.15% in eight years or the board's current designated reserve ratio, d.r.r. target of 1.25% are inadequate to achieve this long-term policy goal given how rapidly the d.i.f. fund has been depleted by both the number and size of the bank failures over the last 18 months. nevertheless, i believe the board's actions today will reenforse public confidence in the fdic's -- reinforce public confidence in the fdic's federally guaranteed insurance obligations now and into the future. thank you. >> thank you very much. >> thank you, ma'am chairman. i think this -- thank you, madam chairman. i support them, of course, subject to receiving comment. i say that i support the thoughtful comments of my colleagues that they just gave. i think getting at some fundamental issues over time which i think raises concerns that i know you share as well.

i think the actions represent a balanced approach to raising needed money for the deposit insurance fund without combaring the ability of our banks to support economic recovery. earlier this year, i said i was very concerned about the pro-cyclical effects of imposing one or more special assessments on the industry in the middle of a recession when so many banks were struggling. for banks that were already feeling the effects of a weak economy, special assessments could make them weaker and less credible that businesses and families need. so i'm very pleased that we are proposing not to impose another special assessment in 2009 or 2010. the fact is that given the pro scombrected costs, as we -- projected costs, as we just heard, they can't have the needs on a pay-as-you go. we need to spread out the assessment costs to repay the

amounts that we borrowed. given that stubborn fact, it makes good sense not to increase assessments now at the worse possible time. having said that, i think it's important for everyone to recognize, as others have said, that all of the borrowing options we have before us will be paid for by the industry as is appropriate. if we had gone the route of proposing borrowing from treasury that loan would ultimately be repaid by the industry. and the industry would not be in the position of financing the liquidity needs of the insurance fund all at once and upfront. borrowing from treasury would allow us to spread the assessment burden out over a number of years without requiring these upfront funds for liquidity. but that option does create more of a perception that the fund is somehow being paid for by the taxpayer even though that is not an appropriate perception. on the other hand, our proposed prepaid assessment option addresses that issue squarely

bier suring that the industry both provides the upfront resources for liquidity and pays for it overtime through additional assessments. the only potential downside of this it seems to me is that the cash provided to the fdic will not be available to make loans. given the size of the amount we're seeking, however, $45 billion spread out over the multitrillion dollar banking industry, i think it's over $13 trillion in assets, this may not be likely to have any material effect on credit availability. and indeed a number of banks argue that liquidity is plentiful and is not a lending constraint at the moment. i think those are all fair points but i think this is a fair question and i hope we will get comments on it. i think the staff did an excellent job and i support the way you've handled it. >> thank you. director booman.

>> thank you, chairman bair. i'd also suggest that in addition to the very critical statutory rule that we at the fdic have to pursue, i'd suggest that one of the primary functions of the board is to ensure that the public's continued confidence in the fdic and the d.i.f. in that regard i would suggest that it's critical that this board work to restore d.i.f. in a manner that's least disruptive and least costly to the industry. with those goals in mind i fully support the n.p.r. and i look forward to the comments from all involved. thank you very much. >> thank you very much. and i would just like to reiterate some of the excellent remarks that's already been made. i think the most important thing for everyone to remember here is that the outcome of the case is the nonevent for insured depositors. everyone knows that the fdic has immediate access to $100 billion credit line at treasury and that can be expanded to $500 billion with the concurrence of the fed and the treasury.

we also have authority to get up to 90%. the mechanics are already in place to implement those options if they become necessary and they have been for sometime. the fdic's commitment to depositors is absolute and we have enough resources to make good on that jitment. what this proposal is really about is how and when the industry fulfills its obligations to the insurance fund. with that said, let me explain why we are not going to treasury to strengthen the cash reserves at the fund. i do think that the american people would prefer to see an end to policies that look fought federal balance sheet as the remedy to every problem. this is especially true in the case of this industry that has the resources to deal with these problems. it's important for the industry to maintain public's confidence by demonstrating that we will not fall back on the public safety net in a period of sdiss tres. what we are proposing to do is to tap the ample liquidity of the banking industry to improve our own liquidity position without borrowing from the treasury. i never say never and there is

stuff we can't control for. while we are optimistic on the economy, if conditions unexpectedly worsen, we would need to tap our treasury line. but today is not the day. our analysis suggest that the industry can step up so we're asking that they do so. this proposal would strengthen the cash positions of the d.i.f. right away while allowing the capital impact at the deposit insurance assessments to be felt over time as the industry improves its own financial position. our analysis indicates that this arrangement is much more likely to prove a bank lending. and would likely be neutral with regard to bank lending. we would not propose this option unless we had reason to believe that the performance of the insurance would improve during the period. this is something we saw in the aftermath of the banking crisis -- last banking crisis in the 1990's. it could add tens of billions

of dollars to the bottom line every quarter. that's why we feel comfortable enough to have a modest across the board increase in the deposit insurance premiums after last year -- next year when it should be improving. ours has always been an industry funded. this calls on the industry to improve the excess liquidity now. it does so without requiring a near term hit to capital that would impair the bank's ability to lend. we are seeking comment from the industry and the public as to its provisions. we look forward to reviewing those comments and moving deliberately toward a final rule on this matter. before i call for a vote, i'd like to thank the staff for excellent work. this has been a very difficult process. not good options here. i'd also like to thank the board for coming together in what is clearly a very difficult issue. with that may i have a motion? >> move. >> may i have a second?

>> second. >> all those in favor say aye. >> aye. >> the motion is agreed to. that concludes the discussion of the agenda. we will now move into closed session. [captions copyright national cable satellite corp. 2009] [captioning performed by natonal captioning institute] >> this saturday, the meaning of matthew, my son's murder and laramie and a world transformed. following a taped event, judy shepard, the mother of matthew shepard, will take your calls. and then three hours in dependent with hugh hewitt. he's the author of 12 books, including the latest "g.o.p. 5.0." live, this weekend on c-span

2's "book tv." >> c-span, the supreme court week is just a week away. featuring personal interviews with each of the currently serving and retired supreme court justices. get an insider's view of the people and places that make up the nation's highest court. >> why is it that we have an elegant, astonishingly beautiful, imposing, impressive structure? it's to remind us that we have an important function. and to remind the public when it sees the building of the importance and the centrality of the law. >> supreme court week starts sunday, october 4 on c-span. and to compliment our original production, c-span offers teachers free resources on the judicial system at c-spanclassroom.org. >> c-span's 2010 student cam contest is here. $50,000 in prizes for middle

and high school students. just create a five to eight-minute video on one of our country's greatest strength or challenges the country is facing. it must show varying points of view. deadline january 20. winning entries will be shown on c-span. grab a camera and get started. go to studentcam.org for contest rules and info. >> the house returns at 6:00 p.m. eastern. debate at that time to instruct negotiators on f.y. 2010 agriculture spending. plus, at 6:30 votes on bills debated earlier and general speeches tonight. also coming this week, a measure that authorizes $1.5 billion for 5 1/2 years to aid pakistan. and possible debate on several conference reports. live house coverage coming up again in 10 minutes at 6:00 eastern. and president obama met with the new nato secretary general that took office last summer. the two talked afterwards just

under 10 minutes. >> hello, everybody. i just want to welcome secretary general rasmussen to the oval office. he and i had the opportunity to get to know each other at the nato summit in strawsberg at which he was -- strawsburg at which he was nominated and selected as the new secretary of general of nato. i could say that given his experience as head of state that everybody had confidence in his decisive and effective leadership abilities. that confidence has proven justified in the brief time he's been in nato. i think he's shown himself to be an effective secretary general interested in reforming and renewing the nato alliance

and always rooted in the understanding that this is the most successful military alliance in history. and the cornerstone of trans-atlantic relationships. we had a very fruitful discussion while he was here. we talked about obviously the most important nato mission right now and that is afghanistan. and we both agree that it is absolutely critical that we are successful in dismantling, disrupting the al qaeda network. and that we are effectively working with the afghan government to provide the security necessary for that country. this is not an american battle. this is a nato mission as well and we are working actively and

diligently to consult with nato at every step of the way. and i'm very grateful for the leadership that secretary general rasmussen has shown in committing nato to a full partnership in this process. we also discussed missile defense and we both agree that the configuration that we have proposed is one that ultimately will serve the fathers of not only the united states but also nato alliance members most effectively. it allows for a full collaboration with nato members. and we are very optimistic that it will achieve our aims and deal with the very real threat

of ballistic missiles. we also agree that it's very important for us to reach out to russia and explore ways in which the missile defense configurations we envisioned could potentially lead to further collaboration with russia on this front. and that we want to improve generally not only u.s.-russian relations but also nato-russian relations while making absolutely clear that our commitments to all of our allies in nato is sacrosanct and our commitment to article 5 continues. finally, we discussed the process that we're putting forward for a strategic concept to rebuke. it has been so successful that

sometimes i think that we forget this was shaped and crafted for a 20th century landscape. we're now well into the 21st century, and that means that we are going to have to constantly renew and revitalize nato to meet current threats and not just past threats. there has been a process that has been put forward. we are fully supportive of it. i am confident that under secretary general rasmussen's leadership that it will ultimately be successful. and that we will continue to see nato operate in a way that is good for u.s. national security interests, good for our allies and good for the world. so, mr. secretary general, we appreciate the work that you are doing. please feel free to share a few words. >> thank you, mr. president,

for your kind words. the president and i had a very constructive meeting. i have thaad the president for his strong support. i look very much forward to cooperating with the president and his administration on reforming, transforming and modernizing nato. we are going to elaborate a new strategic concept which i hope can serve for renewal of nato. of course, our main focus today has been our operation in afghanistan. i say our focus deliberately because our operation in afghanistan is not america's responsibility or burden alone. it is and it will remain a team effort.

i agree with president obama in his approach. strategy first, then resources. the first thing is not numbers. it is to find and fine tune the right approach to implement the strategy already laid down. and all nato allies are right now looking at mcchrystal's review. i'm convinced that success in afghanistan is achievable and will be achieved. and don't make any mistake, the normal discussion on the right approach should not be misinterpreted as lack of a result. this alliance will stand united and we will stay in afghanistan as long as it takes to finish

our job. as the president mentioned, we have also discussioned missile defense. i welcome the new u.s. approach which will allow all allies to participate which will protect all allies and in fact, i think, the proposed new system can serve as an instrument to bind all allies, new and old, even stronger together. thank you. >> thank you so much. all right. thank you, everybody. >> live now to the u.s. capitol as the u.s. house is about to return following a recess. on the agenda this evening, a motion to instruct negotiators on fiscal year 2010 agriculture spending. also, set for 6:30, votes on

bills debated earlier today and general speeches also tonight. this is live house coverage on c-span. .

>> waiting for the house of representatives to come back into session. on the agenda this evening a motion to instruct negotiators of fy-2010 agriculture spending, and votes at 6:30 p.m. on bills debated earlier today.

while we wait for the house to come back in the senate finance committee continues its markup of a health care bill. they are in a recess now, back they are in a recess now, back at 7:15 eastern. provide for an additional temporary extension of programs under the small business act and the small business investment act of 1958 and for other purposes. the speaker pro tempore: for what purpose does the gentlelady from connecticut rise? >> mr. speaker, pursuant to clause 1 of rule 22 and by direction of the committee on appropriations, i moove to take from the speaker's table the bill h.r. 2997, making appropiations for agriculture, rural development, food and drug administration and related agencies for the fiscal year ending september 30, 2010, and for other purposes with a senate amendment thereto. agree to the senate amendment and the conference asked by the senate. the speaker pro tempore: the clerk will report the title. the clerk: h.r. 2997, an act making appropriations for

agriculture, rural development, food and drug administration and related agencies programs for the fiscal year ending september 30, 2010rks and for other purposes. the speaker pro tempore: without objection, so ordered. for what purpose does the gentleman from georgia rise? >> i have a motion to instruct conferees. the speaker pro tempore: the clerk will report the motion. the clerk: mr. kingston of georgia moves that the managers on the part of the house at the conference on the disagreeing votes of the two houses on the senate amendment to the bill h.r. 2997 be instructed to not record their approval of the final conference agreement within the meaning of clause 12-a-4 of house rule 22 unless the text of such agreement has been available to the managers in an electronic, searchable and downloadable form for at least 72 hours prior to the time described in such clalls. the speaker pro tempore: pursuant to clause 7 of rule 22,

the gentleman from georgia, mr. kingston, and the gentlewoman from connecticut, mrs. delauro, will each control 30 minutes. the chair recognizes the gentleman from georgia. mr. kingston: thank you, mr. speaker. and i yield myself such time as i may consume. and i also want to thank the chairwoman of the subcommittee of agriculture, mrs. delauro, i enjoyed working with her throughout this process. we had a very good debate. we had a number of good productive hearings and we've had a lot of good discussions outside the scope of the hearings that have been helpful. so week of been -- i say moving the ball forward and good communication. one of the things that members of congress need that are not on this committee is time to read bills and this was really brought to our attention by mr. baird of oregon who introduced the bill earlier this session that said, a health care bill

should lay on the table for 72 hours. to underscore this, i think that at the tarp bill that we had almost a year ago, in november last year, and what happened during that bill, as we remember, secretary paulson was in a rush to do something big and bold. i think those were his compact words. something significant -- exact words. something significant. send a signal to the wall street market that the federal government was going stand behind their financial travails and i remember at one particular point, hosting that -- posting that bill on my website on a sunday night which was the weekend that we were in washington and people back home were calming but they couldn't get any information. we put it on our website, as soon as it was available, i think it was about 10:00 p.m. at night. by the morning i was floored, the number of constituents who had read that bill, that appreciated the bill being put

on the website. i think also about the cap and trade bill, which was not a very popular bill, indeed it hasn't passed the senate because of the public outcry on it, but during the time in the house, the way the democratic majority passed the bill was through the usual system which we, both parties, use around here called arm twisting and sometimes sweetening the pot of the bill. and in that case the cap and trade bill was actually being renegotiated, i believe, at 3:00 a.m. in the morning when the house was convening at 9:00 a.m. now, i was sleeping and i would suggest that 435 members of the house were probably sleeping. maybe a handful were still awake, maybe they were in the speaker's office having their arms twisted. and maybe they said, in exchange for my vote, i want to see some language put in the bill. i don't know what happened, mr. speaker, but what do i know is that bill was amended at 3:00 in

the morning. there were things that were put in that bill. and i think because of that mr. baird, a democrat from oregon, has reacted and said, you know, we need to make sure. because democrats and republicans have been guilty of last-minute bill changing and last-minute arm twisting. let's put the bill out on the website, let's lay it out on the table for 72 hours so that everybody has an opportunity to read about it. and i think in this case the sunshine is always helpful. i think in this bill, i believe i know what's in this bill, i feel very comfortable about this bill, voting for it. i think most members of the subcommittee and the appropriations committee will. but i would also say that members who are not on the appropriations committee who are always kind of jump on us for doing things behind the scenes, they would benefit from having the bill out on the table. i know i would have benefited from it, the energy and commerce committee having the cap and

trade bill out on the table for 72 hours. what we are asking in this amendment is that members have time to read bills, putting it on the table for 72 hours. that's all that this motion does and i reserve the balance of my time. the speaker pro tempore: the gentleman reserves. the gentlelady from connecticut. ms. delauro: i thank the speaker and, mr. speaker, i yield myself as much time as i may consume. the speaker pro tempore: the gentlelady is recognized. ms. delauro: i, too, want to compliment my colleague and friend and ranking member, mr. kingston. i think we have worked together on a bipartisan basis with regard to this piece of legislation and i think we both feel that we've had a lot of sufficient input and we have come through this with identifying the needs that this

agriculture