CQ Transcripts Wire
Monday, September 22, 2008 2:36 PM
SPEAKER: SEN. BARACK OBAMA, D-ILL.
[*] OBAMA: The era of greed and irresponsibility on Wall Street and in Washington has led us to a perilous moment. They said they wanted to let the market run free but instead they let it run wild, and in doing so, they tramped our core values of fairness, balance, and responsibility to one another. As a result, we are facing a financial crisis as profound as any we have faced since the Great Depression. As a result, your jobs, your savings, and your economic security are now at risk.
This week, we must work quickly, in a bipartisan fashion, to resolve this crisis and avert an even broader economic catastrophe. And as we do act, Washington must recognize that true economic recovery requires addressing not just the crisis on Wall Street, but the crisis on Main Street that so many of you have been feeling in your own lives long before the news of last week. We need a plan that helps families stay in their homes, and workers keep their jobs; a plan that gives hardworking Americans relief instead of using taxpayer dollars to reward CEOs on Wall Street. And we cannot give a blank check to Washington with no oversight and accountability when no oversight and accountability is what got us into this mess in the first place.
But no matter what solution we finally decide on this week, it is absolutely imperative that we get to work immediately on reforming the broken politics and the broken government that allowed this to crisis to happen in the first place.
We did not arrive at this moment by some accident of history. We are in this mess because of a bankrupt philosophy that says we should give more and more to those with the most and hope that prosperity trickles down to the rest of us.
We're here because for too long, the doors of Washington have been thrown open to an army of lobbyists and special interests who've turned our government into a game only they can afford to play - who have shredded consumer protections, fought against common-sense regulations and rules of the road, and distorted our economy so that it works for them instead of you.
We are here because an ethic of irresponsibility has swept through our government, leaving politicians with the belief that they can waste billions and billions of your money on no-bid contracts for friends and contributors, slip pork projects into bills during the dead of night, and spend billions on corporate tax breaks we can't afford and old programs that we don't need.
And today, even as Congress debates an emergency plan to save our economy from the verge of collapse, there are reports that lobbyists and CEOs are already lining up to figure out what's in it for them; to find out how they can get theirs.
Green Bay, enough is enough.
I began this race for the presidency as the one candidate who hasn't spent a lot of time learning the ways of Washington. But I've been there long enough to know this - if we want a government that puts the needs of middle-class families before the whims of lobbyists and politicians; if we want to grow this economy and prevent a crisis like this from ever happening again, then the ways of Washington must change. We must reform our lobbyist-driven politics. We must reform the waste and abuse in our government. We must reform the rules of the road that let Wall Street run wild and stuck Main Street with the bill. We must change Washington now.
This has been our message from the day we began this campaign. Our opponent, on the other hand, has spent much of the last nineteen months arguing that what qualifies him to be President are the decades he's spent in Washington.
But with forty-two days left, he's had a sudden change of heart. An election-time conversion. After twenty-six years in Washington - years where he voted for the same trickle-down, on-your-own policies that got us into this mess - he now claims that he's the one who can clean it up.
Well let's be clear. When it comes to regulatory reform, Senator McCain has fought time and time again against the common-sense rules of the road that could've prevented this crisis. His economic plan was written by Phil Gramm, the architect in the US Senate of the de- regulatory steps that helped cause this mess. Even knowing what we know now, Senator McCain said in an interview just last night that de-regulation actually helped grow our economy. Well that might be true for the profits of a few CEOs, but it's certainly not true for America's prosperity.
When it comes to taking on the special interests, my opponent sounds like Fighting Bob Lafollette. But he acts like a guy who's spent three decades of his life in Washington. He's put seven of the biggest corporate lobbyists in charge of his campaign - lobbyists for the insurance industry and the oil industry; for foreign governments and Freddie and Fannie Mac, who paid his campaign manager nearly $2 million to defend them against stricter regulations. I guess they got their money's worth.
And rest assured, those lobbyists who are working day and night to elect my opponent aren't doing it to put themselves out of business.
When it comes to reforming government waste and spending, Senator McCain talks a lot about earmarks. And while he deserves credit for not requesting many of those earmarks during his time in Congress, what he never mentions is that he voted for 144 billion dollars worth in just six years; or that he voted for four out of the five Bush budgets that have been filled with special interests giveaways and left us with the largest deficit in history.
The truth is, our earmark system in Washington is fraught with abuse. It badly needs reform - which is why I didn't request a single earmark last year, why I've released all my previous requests for the public to see, and why I've pledged to slash earmarks by more than half when I am President.
But let's not pretend, as John McCain does, that proposing the elimination of 18 billion dollars of earmarks will make up for the more than 300 billion additional dollars he wants to spend on tax breaks for big corporations and multi-millionaires that don't need them and weren't asking for them - more than 300 billion dollars at a time when taxpayers are being asked to help finance two wars and a historic financial bailout. That's some pretty creative math, but it doesn't add up to is change. And change in Washington is what we need right now.
This change will not be easy. It will require reforming our politics by taking power away from the lobbyists who kill good ideas and good plans with secret meetings and campaign checks. It will require reforming our government by taking on the spending habits of both parties and going after the tax havens and loopholes that big corporations use to avoid paying their fare share while you pay more. And it will require reforming our out-dated, unfair regulatory system that favors Wall Street over Main Street but has ended up hurting both.
But I am ready to reform our politics because I've done it before. I've spent my career taking on lobbyists and their money, and I've won. When I was a state Senator in Illinois, if you wanted a favor, there was actually a law that let you give campaign cash to politicians for their own personal use. In the State House, they called it business-as-usual. I called it legalized bribery, and while it didn't make me the most popular guy in Springfield, I put an end to it. I brought Democrats and Republicans together, and we passed the first ethics reform in twenty-five years.
When I got to Washington, Jack Abramoff and his lobbyist pals had engaged in some of the worst corruption since Watergate. I led the fight for reform in my party, and let me tell you - not everyone in my party was too happy about it. When I proposed forcing lobbyists to disclose who they're raising money from and who in Congress they're funneling it to, I had a few choice words directed my way on the floor of the Senate. But we got it done, and we banned gifts from lobbyists, and discounted rides on their corporate jets. And I'm the only candidate in this race who can say that Washington lobbyists do not fund my campaign, you do - with donations of $100, and $10, and $5.
I also joined with one of the most conservative Republicans in Congress to end the abuse that allowed no-bid contracts to waste taxpayer dollars instead of using them to rebuild the Gulf Coast after Katrina. And we worked together to put the federal government's checkbook online - so you can see how and where Washington is spending trillions of dollars of your money.
For years, I have also pushed for reform of the same loose regulations and lax oversight that could've prevented the crisis we're in. It was two years ago that I introduced legislation to stop mortgage transactions that promoted fraud, risk or abuse. It was one year ago that I called on our Treasury Secretary and our Fed Chairman to bring every stakeholder together and find a solution to the subprime mortgage meltdown before it got worse. In March, when John McCain was saying "I'm always for less regulation," I called for a new, 21st century regulatory framework to restore accountability, transparency, and trust in our financial markets.
These are the types of reform I will pursue beginning on my very first day in office as President of the United States - political reform, government reform, and regulatory reform.
First, I'll reform our special interest-driven politics. When I am President, I will start by closing the revolving door in the White House that has allowed people to use their Administration job as a stepping stone to further their lobbying careers.
I'll make it absolutely clear that working in an Obama Administration is not about serving your former employer, your future employer, or your bank account - it's about serving your country. When you walk into my administration, you will not be able to work on regulations or contracts directly related to your former employer for two years. And when you leave, you will not be able to lobby my Administration - ever. I will also institute an absolute gift ban so that no registered lobbyist can curry favor with members of my administration based on how much they can spend on a fancy dinner.
I'll make our government open and transparent so that anyone can ensure that our business is the people's business. As Justice Louis Brandeis once said, sunlight is the greatest disinfectant. As President, I will make it impossible for Congressmen or lobbyists to slip pork-barrel projects or corporate welfare into laws when no one is looking because when I am president, meetings where laws are written will be more open to the public. No more secrecy.
When there is a bill that ends up on my desk as President, you will have five days to look online and find out what's in it before I sign it. When there are meetings between lobbyists and a government agency, we will put as many as possible online for every American to watch. When there is a tax bill being debated in Congress, you will know the names of the corporations that would benefit and how much money they would get. And we will put every corporate tax break and every pork-barrel project online for every American to see. You will know who asked for them and you can cast your vote accordingly.
The second set of reforms I'll make will eliminate the waste, fraud, and abuse in our government.
We are facing the largest deficit in history. We are facing the largest government bailout in history. And we are also facing some of the greatest challenges in our history. All of this will cost money - to fix our health care system, and our schools, and build a new energy economy. And the only way we can do all this without leaving our children with an even larger debt is if Washington starts taking responsibility for every dime that it spends.
We can start by ending a war in Iraq that is costing us $10 billion a month when the Iraqi government is sitting on a $79 billion surplus. We should also stop sending fifteen billion dollars a year in overpayments to insurance companies for Medicare and go after tens of billions of dollars in Medicare and Medicaid fraud. We need to stop sending three billion a year to banks that provide student loans the government could provide for less, and hundreds of millions a year in subsidies to agribusiness that can survive just fine without your tax dollars and use some of the money to help family farmers who are struggling. I will put an end to this waste when I am President.
I am not a Democrat who believes that we can or should defend every government program just because it's there. There are some that don't work like we had hoped - like the Bush Administration's billion- dollar-a-year reading program that hasn't improved our children's reading. And there are some that have been duplicated by other programs that we just need to cut back - like waste at the Economic Development Agency and the Export-Import Bank that has become little more than a fund for corporate welfare.
I understand there are parts of these programs worth defending and politicians of both parties who will do so. But if we hope to meet the challenges of our time, we must make difficult choices. As President, I will go through the entire federal budget, page by page, line by line, and I will eliminate the programs that don't work and aren't needed.
As for the programs we do need, I will make them work better and cost less. I will create a High-Performance Team that evaluates every agency and every office based on how well they're serving the American taxpayer. We will fire government managers who aren't getting results, we will cut funding for programs that are wasting your money, and we will use technology and lessons from the private sector to improve efficiency across every level of government - because we cannot meet twenty-first century challenges with a twentieth century bureaucracy.
I will also save billions of dollars by cutting private contractors and improving management of the hundreds of billions of dollars our government spends on private contracts, and I will end the abuse of no-bid contracts for good. One employee of a former Halliburton subsidiary actually admitted that he was ordered to put his company's logo on towels provided to U.S. troops because our government - our tax dollars - would pay for it no matter how much it cost. That is wasteful, that is wrong, and that will end when I am President.
And for all his talk about earmark abuse, what Senator McCain doesn't mention these days is the corporate abuse of our tax system - abuse that has cost far more than earmarks ever have. In 2003, loopholes and tax breaks allowed 28 major corporations to actually have negative tax liabilities. We lose $100 billion every year because corporations get to set up mailboxes offshore so they can avoid paying a dime of taxes in America. Imagine if you got to do that? There is a building right now in the Cayman Islands that is the address for 18,000 corporations. Well that is either the biggest building in the world or the biggest sham in the world, and I think we know which one it is. I will shut down those offshore tax havens and all those corporate loopholes as President, because you shouldn't have to pay higher taxes because some big corporation cut corners to avoid paying theirs. All of us have a responsibility to pay our fair share. That's putting country first.
Finally, the third set of reforms I will pursue are the updated, common-sense regulations of the financial market that I've been calling for since March; rules of the road that will make Wall Street fair, open, and honest; that will ensure a crisis like this can never happen again.
I've outlined six principles that such reforms should follow. First, if you're a financial institution that can borrow from the government, you should be subject to government oversight and supervision. Taxpayers who have now been called upon to spend nearly a trillion dollars to save our economy from the excesses of Wall Street have every right to expect that financial institutions are not taking excessive risks.
Second, we need to reform requirements on all regulated financial institutions, investigate rating agencies and potential conflicts of interest with the people they are rating, and establish transparency requirements that demand full disclosure by financial institutions to shareholders.
Third, we need to streamline our overlapping and competing regulatory agencies that cannot oversee the large and complex institutions that dominate the financial landscape.
Fourth, we need to regulate institutions for what they do, not what they are. Over the last few years, commercial banks and thrift institutions were subject to guidelines on subprime mortgages that did not apply to mortgage brokers and companies. This regulatory framework failed to protect homeowners, and made no sense for our financial system.
Fifth, we need to crack down on trading activity that crosses the line to market manipulation. We need regulators that actually enforce the rules instead of overlooking them. The SEC should investigate and punish all market manipulation.
Sixth, we must establish a process that identifies systemic risks to the financial system like the crisis that has overtaken our economy. We need a standing financial market advisory group to meet regularly and provide advice to the President, Congress, and regulators on the state of our financial markets and the risks they face. It's time to anticipate risks before they erupt into a full- blown crisis.
These are the principles that should guide the reforms we need to establish a 21st century regulatory system - a system that recognizes our free market economy has only worked because we have guided the market's invisible hand with a higher principle - that America prospers when all Americans can prosper.
To restore this prosperity, we must change Washington. We must reform our regulations, our politics, and our government, but we will not be able to make these changes with the same policies, the same lobbyists, or the same Washington culture that allows politicians and special interests to set their own agenda.
That's exactly what we will get from John McCain. After twenty- six years of being part of this Washington culture, all that he has changed is his slogan for the fall campaign. And the people in charge of that campaign prove that if we elect John McCain, it's not a team of mavericks we'll be sending to the White House - it's a team of lobbyists.
We can't afford four more years of that kind of politics. We need real change.
It won't be easy. The kind of change we're looking for never is. What we are up against is a very powerful, entrenched status quo in Washington who will say anything and do anything and fight with everything they've got to keep things just the way are.
But I feel good about our chances, because I've got something more powerful than they do: I've got you. In this campaign, you have already shown what history teaches us - that at defining moments like this one, the change we need doesn't come from Washington. Change comes to Washington.
Change has always come from places like Wisconsin - the state where the progressive movement was born; where laws were passed to regulate the railroads and insurance companies; laws that protected consumers and the safety of factory workers. It was a movement rooted in a principle that was known as the Wisconsin Idea - the idea that government works best in the hands of the people, not the special interests; that your voices should speak louder than the whispers of lobbyists.
That's the Wisconsin idea. That's the America idea. And that's the kind of government we need right now.
So if you want the next four years in Washington to look just like the last eight, then I am not your candidate. But if you want real change - if you want to shine a bright light into the backrooms of Washington; if you want to replace the special interests with your interests, if you want a government that costs less and works better for everyday Americans, then I ask you to knock on some doors, and make some calls, and talk to your neighbors, and give me your vote on November 4th. And if you do, I promise you - we will change America together. Thank you.