and i'm just amazed, mr. levin, if the kind of decisions that ran the company in the ground were above the 45 million-dollar mark which was your pay grade. thank you, mr. chairman. >> thank you, mr. vice chair. i have just a very quick concluding questions and they're really clever addition. so very brief answers and i have one question for you, mr. mudd, in conclusion. when you talk about mission, i just want to be clear that obviously there is the business, the prophet nation, and i mentioned the affordable housing, did you, would liquidity be included, and liquidity for the housing market? >> yes. >> again, for the record as i understood the interchange with you and mr. wallison, and i think i'm characterizing it, that all lines of business were pursued with an eye towards making money, but there may have been deferential for those various lines of business, correct? >> yes. >> all right. just want to be clear. but there were no businesses and would you deliberately engaged with the idea, even though obviously i

mr. levin: mr. speaker, purr superintendent to the order of the house today -- pursuant to the order of the house today, i call up h.r. 4851 with the senate amendment there to and offer a motion. the speaker pro tempore: the clerk will report the title of the bill, designate the senate amendment and report the motion. the clerk: h.r. 4851, an act to provide a temporary extension of certain programs and for other purposes. senate amendment, mr. levin moves that the house concur in the senate amendment. the speaker pro tempore: pursuant to the order of the house today, the motion shall be debatable for one hour, equally divided and controlled by the ranking and minority member of the ways and means. the gentleman from michigan, mr. levin, and the gentleman from texas, mr. brady, each will control 20 minutes. the chair recognizes the gentleman from michigan, mr. levin. mr. levin: mr. speaker, i ask unanimous consent that members have five legislative days to revise and extends their remarks. the speake

mr. levin, you were there longer than mr. mudd. were you ever present at a meeting in which there was a discussion about how a particular member of congress might be approached in attempting to advance "business models" of fannie mae? >> my recollection is, especially in the days that i ran the housing of community development organization in fannie mae, which was the organization -- >> i have very little time. really, a yes or no will be sufficient because it followed up with comments to elaborate. >> i will be short. we made a big effort to try to do important things in communities -- >> i will try again. yes or no? >> and we made -- >> mr. chairman? >> can you answer that question? >> i did ask a minute of time. >> i will give it back. i think it is a fairly straightforward question, mr. levin, about whether you are in a meeting or not and if approaching a member of congress was raised. >> i think yes or no would be appropriate. >> we want it members of congress -- >> that is be on five words. >> come on, yes or no. the answer i

mr. levin: mr. president? the presiding officer: the senator from michigan is recognized. mr. levin: has the quorum call begun? the presiding officer: yes. mr. levin: i would ask unanimous consent that further proceedings under the quorum call be dispensed with. the presiding officer: without objection, so ordered. mr. levin: mr. president, yesterday the senate permanent subcommittee on investigations, which i chair, held the fourth in our series of hearings to explore some of the causes and consequences of the financial crisis. these hearings are the culmination of nearly a year and a half of investigation. mr. president, if i could yield myself ten minutes? the presiding officer: without objection, so ordered. mr. levin: the freezing of financial markets in the collapse of financial institutions that sparked our investigation are not just a matter of numbers on a balance sheet. these are numbers reflecting millions of americans who lost their jobs, lost their homes, lost their businesses a in a re

mr. levin: the march 19 letter from the corps. the senator from louisiana said that the example he wanted to use was something called the morganza project. that's the example. he said, let me give you one example. three times he's said the project's been authorized. this is what the corps said relative to morganza. the corps does not have the authority -- this is in writing, a letter to senator vitter, does not have the authority to implement whom the navigation lock, section 425 of wrda, 1996 authorized a study of an independent lock but did not authorize construction. section 425 reads in part, secretary shall conduct a study of the environmental flood control and navigation impacts associated with the construction of a lock structure in the huma navigational canal as an independent feature of the overall damage prevention study conducted under the morganza, louisiana, to the gulf of mexico feasibility study. close quote. the corps conducted a study in response to section 425, but that study did not recommend the construction of

mr. levin, please. >> yes, sir. >> in closing, a global liquidity and credit crisis engulfed fannie mae and it's only line of business, secondary market for mortgages these were centered on our market and asset class and we took the bull brunt of the market crisis head on which would have been difficult for the company to deal with under any circumstances. thank you. i'm pleased to answer any questions that you have. >> thank you very much. mr. mudd? >> thank you, mr. chairman and mr. vice chairman. i've had the opportunity to watch some of the commission's proceedings this week and having submitted remarks which cover a broad array of topics, i'm going to try a little bit to tailor my remarks to some of the issues that you've been pursuing. and thank you for the opportunity to appear today. i join fannie mae as the chief operating officer in 2000 following a decade at gd. in december of '04, i was interim chief executive officer and in june of '05, the board of directors with the approval name

we would like you each to take no more than 10 minutes for your oral statement and mr. levin, we will start with you. we are ready for your testimony. before i start, mr. vice chairman, would you like to make any opening remarks? >> no, thank you, mr. chairman. i would take the opportunity to ask that if over the rest of the commission's existence we have reason to continue discussion over the material you have presented, would to be willing to respond to written questions in a timely fashion in an ongoing way? thank you. thank you, mr. chairman. >> mr. levin, proceed. >>one last item. you see a light in front of you. it will move to yellow with one minute to go and read when time is up. -- and red when time is up. [no audio] my >> if you could move the microphone a bit closer. is the light on? >> it needs to be closer. >> we will start your time over. >> that sounds better. start over. let's go. >> start over from scratch, sir? mr. chairman, vice chairman, distinguished commissioners, thank you for providing me the opportunity to appear before you today to assess the conditi

called upon the new chairman of the house ways and means committee, the gentleman from michigan, mr. levin, to schedule hearings on tax code simplification. the fair tax proposal is one of those ideas that i've asked his committee to consider. the fair tax can start the conversation on tax reform, and i encourage my colleagues who are serious about having this discussion to join me in contacting the chairman. people across the country are demanding that congress listen to their concerns and find a more equitable and less burdensome way of paying taxes. i share their frustration and have called upon my colleagues in congress to put the politics aside and provide tax relief and reform for this country. americans have made it known that they are in need of serious tax reform. through increased spending and budget deficits, congress has awaken and american majority that is dedicated to government reform. members of congress have an obligation to be responsive to our people's needs. as the american people gather this week to make their voices heard, congress must listen. these gatherings are oc

through the relevant committee, the armed services committee of the united states senate, chaired by mr. levin senator levin. the ranking member is senator mccain. it was unanimously reported out by the committee. by all republicans and all democrats. it is a nomination supported by senator levin, senator mccain, the chairman and the ranking member. and, yet, that nomination was sent to the floor of the senate nearly six months ago and has yet to be acted upon because there is a hold on it. what is called a hold. i have spoken about this before last week. we have a member of the senate who said to the corps of engineers, i'm going to stop this general's promotion to major general until the corps of engineers does the following things that i demand from the corps of engineers in my home state in louisiana. this is senator vitter of louisiana. i did say to senator vitter, i would not come and speak of another senator until i told him i would do that. i told senator vitter i would be critical on the floor of the senate to what he was doing to general walsh. a patriot, someone who served 30 years

mr. rymer. >> chairman levin, senator coburn and members of the committee, we thank you for the opportunity to be here today with my colleague, mr. rymer, to testify about our joint evaluation of the failure of washington mutual savings bank. over the past two years our country has found itself immersed in a financial crisis that started when housing prices stop rising and borrowers could no longer refinance their weight out of financial difficulty since then we're seeing record levels of delinquency, default, foreclosures and declining real estate values. as a result securities tied to real estate prices have plummeted, financial institutions have collapsed. in many cases, the financial institutions seem financially sound. but the warning signs were there as they were in the case of wamu. at the time of its failure in september 2008, wamu was one of the largest federally insured financial institutions operating 2300 branches in 15 states with assets of $307 billion. a very brief background. my office performs on its and investigations at most treasury bureaus and offices, and that includes ot

mr. bowman? >> good afternoon, chairman levin.my name is jo john bowman who was office of the thrift supervision a little over one year ago. during the height of the financial crisis after about five years as the agency's chief counsel. it is not a role that i sought. but i am honored to serve. my written testimony summarizes ots's supervision of washington mutual or wamu and the reasons why wamu failed. it is important to note that this failure came at no cost to the deposit insurance fund and at no cost to the american taxpayer. unlike recent failures of other financial institutions and the near collapse of some of the nation's largest banks, which were deemed too big to fail and, therefore, provided government assistance. the demise of the wamu of 200 banks and thrifts during this crisis. lifelines such as the treasury's t.a.r.p. program and the fdic's increase in the indeposit insurance coverage came too late for wamu. during the real estate boom before the crisis, wamu and other financial firms made a critical error by widely

mr. dohr. >> thank you, chairman levin.appreciate the opportunity to testify on my role with the fdic regarding washington mutual bank. on behalf of the corporation, we have submitted to the subcommittee a written statement that respond to specific issues that were requested by the subcommittee. in addition, allow me to briefly introduce myself and my roles and responsibilities at the fdic. i'm john corston, acting deputy directer for the could consumer protections financial institution branch in the washington d.c. i have a leading role in this branch since 2005 after working in three different regions in various capacities related to bank supervision. i started as a field examiner with the fdic in 1987. an element of my duties as acting deputy directer of complex financial institutions is to oversee the large insurer depository institution program. also known as lidi. broadly, forward-looking assessment over $10 billion, provides highly-experienced technical experts to provide on-site support for the regions, operations c

mr. kissinger. >> thank you. chairman levin, a ranking member coburn and distinguished subcommittee members, thank you for inviting me to testify and sharing these remarks with you. this is my first public statement since the fbi washington mutual in september 2008. i want to be clear about the key factors that led to an elevated level of risk during the financial crisis. risks that were created over many years prior to my arrival at wamu in 2005. i also want to summarize how the team i was a part of recognized those risks and made solid progress and proactively reducing them. in particular i want to be very clear on the topic of high-risk lending the committee is focusing on today. high risk mortgage lending in wamu's caisse primero the option arms and subprimal loans through long beach mortgage subsidiary of wamu work expanded and accelerated at exclusive rates starting in the early 2000's prior to my hiring in 2005. in 2004 alone the year before i joined, option arms were up 124% and said prime lending was up 52%. as the fac

mr. bowman. >> good afternoon, chairman levin. my name is john bowman, i am a career federal employee. during the height of the financial crisis after about five years as the agency's chief counsel. it is not a role that i sought, but i am honored to serve. my written testimony summarizes ots' supervision of washington mutual or wamu and the reasons why wamu failed. it is important to note that this failure came rat no cost -- came at no cost to the deposit insurance fund and to the taxpayer. unlike the near collapse of some of the nation's largest banks which were deemed too big to fail and, therefore, provided government assistance. the demise of wamu came early in the procession of more than 200 banks and thrifts that have closed during this crisis. lifelines, such as the treasury's t.a.r.p. program and the fdic's increase in deposit insurance coverage, came too late for wamu. during the real estate boom before the crisis, wamu and other financial firms made a critical error by widely underwriting home mortgages based more on the value of the collateral represented by the homes than

mr. sparks, i would like to follow up on a question that chairman levin asked you in his first series of questioning. what he said was, do you have a responsibility to disclose to a client when you have an adverse interest, do you have a responsibility to disclose to a client when you have an adverse interest to the client? what's the answer to that? >> and senator, by adverse interest, you mean a position that is different than them? or tlg something that we could effect that could harm them? if it's the positions, our answer is no. if we can do harm to them, then the answer is absolutely. >> so you do have, at least in some contexts, but not all, a responsibility to disclose to a client when you have an adverse interest to the client? >> i mean, senator, i'm just trying to be careful with my words with respect to what "adverse interest" could mean. if we were positioned a certain way, that's one thing. again, we could have positions, there could be other positions at the firm. >> do you have a responsibility to tell them what your positions are? >> no. >> why not? >> market makers will

levin, tanner, and camp. the speaker pro tempore: for what purpose does the gentleman from georgia rise? mr. broun: i ask unanimous consent that i may hereafter be considered as the first sponsor of h.r. 1914, a bill originally introduced by representative deal of georgia for the purposes of adding co-sponsors and requesting reprintings pursuant to clause 7 of rule 12. the speaker pro tempore: without objection. for what purpose does the gentleman from georgia rise? mr. gingrey: madam speaker, i ask unanimous consent that i hereafter be considered as a first hons sponsor of h.r. 1868, a bill originally introduced by representative deal of georgia for the purpose of adding co-sponsors and requesting reprintings pursuant to clause 7 of rule 12. the speaker pro tempore: without objection. the gentleman from georgia is recognized. mr. gingrey: i ask unanimous consent that i may hereafter be considered as a first sponsor of h.r. 4336, a bill originally introduced by representative deal of georgia for the purpose of adding co-sponsors and requesting reprintings pursuant to clause 7 of rule 12. the

the colloquy i then had with chairman levin of the house ways and means committee, and i asked them to expedite mr. filner's bill and that it be brought to the floor so that we can correct this error in the president's health bill so that we may cover the widows and/or fans and the -- and/or fanns -- and orphans. that would correct the error and i think that needs to be done. i hoped that mr. filner's bill would have included in the bill which we are presently considering, that would have cleaned this up now. but that didn't occur. every opportunity i have taken to try to correct this error and for whatever reason it just doesn't get done. it needs to be done. i think it was an error in the drafting. no one intended for widows and orr fans -- orphans be left out. i believe it was unintentional. it is a real issue and we need to correct it. so i'm hopeful that's going to do that. i want to thank the chairman for his leadership to correct that error. i would ask my colleagues to pass the bill that's before us and i want to thank the staff on both sides of the aisle for all their efforts in the bill.

mr. chambliss, and republicans love to use fannie and freddie as a whipping boy. if he would just go to c-span and look of the hearings that carl levinwith washington mutual, he could readily learn that many of the subprime loans, alt-a loans, all of thoseloan ls that should never have been made went directly to wall street. it was only late in the game that fannie and freddie got involved. i resent congressmen who like to use them as whipping boys when they themselves do not even know that the early loans went directly to wall street, wall street and bought them up, and the government was not involved. bush actually encouraged fannie and freddie to buy those loans in order to keep the real state ball rolling. host: back to the article in the "washington post" talking about the change in tone -- jim on the republican line. silver spring, maryland. caller: i think what is needed in the area of financial reform, in addition to everything else that has been suggested, we need a form of birth control for financial influence. there should be an approval process which could be difficult that would not allow cdo's to enter the market. host:

mr. reich. okey you've got to understand the environment. it's the environment. everybody was doing it. you have to understand that and my basic thinking is it that is where we are then senator levin and i are on a fool's errand to try to straighten this out. if every time something gets to be popular and every time people are making a lot of money, people like a lot of money my normal response would be i ought to look at that. that is it reassuring to me. >> i think lessons have been learned from what we have been through. >> thank you. mr. dochow? >> one observation i would offer is i've always believed that companies such as banks were ensured by the fdic when a taxpayer is ultimately on the hook for to have a special standard, special crete of some type in their performance in part of to be measured by that standard to the customer to the public interest would tell you in my career i've been dismayed at how much from ceos and even small community banks using the only responsibility was to shareholders >> i'm sorry to have gone so far over, mr. chairman. estimate in another part of today's hearing their questioning the inspectors general from the treasury department and fdic. t

mr. chairman, as you in the chair know, and i, we have differences with this bill. you and senator levin have an amendment you want to offer, that i'm a cosponsor to change the bill. i have an amendment with senator brown, senator brown from ohio to make changes in the bill. senator cantwell and senator mccain have a bill that i'm a cosponsor. there are three amendments already that i'm in favor of that are amendments. i've heard chairman dodd say time and again, this is not the perfect bill. this is a bipartisan bill. we put a lot of effort into it. he's welcomed the opportunity for people to come forward and offer amendments. now, i don't get it how you can say that you don't agree with the bill but you're not going to let anything happen on it. and on an issue like this. an issue that's so important to the american people. so important that we get it right. it's time. committees are great. i support the committee system. i think it's wonderful. i think negotiations are great. i think the bipartisan negotiations going on -- and i know they're going on because i've seen them on the floo