Wednesday, April 22, 2009

U.S. Senator Johnny Isakson (R-GA)
Floor Statement on the Financial Markets Commission
Remarks as Delivered on the Senate Floor

Mr. President, I am honored to be introducing this amendment today on this piece of legislation. I am particularly pleased to have worked for the past 3 1/2 months with the Senator from North Dakota, Mr. Conrad, who is the principal cosponsor on what is known as the Financial Markets Commission.

In the last year, the people of the United States have seen the value of their homes decline, the value of their 529 savings accounts for their kids' college decline, their mutual funds, and their investments in whatever category. Declines that started out to be a hiccup became colossal and we now find ourselves in a position where we are deleveraging and we are deflating in the United States of America.

There should be some answers. Quite frankly, there is plenty of blame to go around, but we need some answers. We need some guidance. We need to ensure that my grandchildren and my children and yours don't ever go through the experiences we have gone through and we have shared with the American people in the last 12 months.

The only way to get an objective evaluation of what went wrong and where mistakes were made is to create an independent commission of recognized people of experience to look into the financial markets, the rating agencies, Freddie Mac, Fannie Mae, investment bankers, hedge fund operators, commodities traders--everybody--and FASB and say: What went right, what went wrong, and what could we have done better to have prevented this from going on?

I have a lot of suggestions. I could drop a lot of bills right now, including transparency for hedge funds and changing who compensates the rating agencies from the seller securities to the buyer securities. But we need a forensic audit of the laws of the United States as it relates to the financial markets, the Federal Reserve, and every aspect, so whatever did go wrong that could have been avoided is avoided.

This Commission is designed to operate for 18 months. It has a budget of $5 million and subpoena powers and it is directed to report back to the Congress of the United States its findings. It is specific in every regard so that anybody who could have been a part of what happened in this financial collapse is subject to investigation, is subject to scrutiny, and is subject to the sunshine that is necessary to get answers.

I think we owe it to the American people. I know I owe it to my children and grandchildren and to those people who voted for me to find out what went wrong and try and make it right.

Senator Conrad has been diligent in his effort to help. He has made very constructive suggestions concerning the amendments to this legislation. Jointly with him, we worked with the Banking Committee members, the ranking member, and the chairman to try to incorporate the ideas of everyone and to make sure we don't miss the mark, that we stay on focus, and we get what the American people deserve; that is, answers to what caused the financial collapse that has decreased the value of their homes, the value of their savings accounts, protracted their retirement, and brought about the uncertainty that we have today in the economy of the United States of America.

With that, I thank the Senator from North Dakota for his help. I thank the chairman and ranking member of the Banking Committee.

***

Mr. President, I thank the Senator from North Dakota for his comments with regard to the commission. I want to reiterate what I said in my earlier speech. When I thought about this, when I watched my kids' 529s, when I watched my own savings for retirement, when I saw what was happening to men and women across the United States, I felt this was a situation that needed a forensic audit, maybe even an autopsy. The damage had already been done. There were multiple factors that led to it. I am not smart enough--I don't know that anybody is--to put a finger on exactly where the blame lies, but I know this: To not find the problems and cure them would be a mistake on the part of the Senate.

Without talking about the select committee as a pro or a con, I want to say why I didn't go that route with this legislation. We are part of what needs to be scrutinized--the Senate. We are part of what needs to be seen. If we left this just strictly to a select committee, it would be like appointing the board of directors to AIG to tell us what went wrong with AIG. It wouldn't be a good autopsy. It wouldn't be objective. Senator Conrad and I have tried to put together a piece of legislation that no one could say is partisan, that no one could say is loaded, that is objective, that gives subpoena power to individuals who have the credibility, the knowledge, and the past experience to evaluate the highly technical derivatives, the highly technical hedge funds, and the rules of trading on the Securities and Exchange Commission.

We may need a select committee for oversight if our committees can't do oversight. But we do not need a select committee to investigate the collapse that has happened. We need an independent body, independent of this body. We need them to have the power and the funds necessary to get the answers to the problem so we can objectively say we exposed ourselves to the same scrutiny to which we wish to expose everybody else. We will have the recommendations of what went wrong, who might have done wrong, and if there were criminal acts on the part of somebody, referrals to the Justice Department.

This is a clean, targeted, bipartisan, specific approach to address the No. 1 financial problem the American people are facing today, and that is the collapse of their savings and the retirement and college education funds of millions of Americans.

I appreciate the endorsement of the Senator from North Dakota, but I want to make sure we understand that a select committee would be no substitute for this independent commission at this time.

***

Mr. President, Senator Conrad and I have worked very diligently for 3 1/2 months to create a platform in which we can get the answers the American people deserve and need with regard to the financial collapse that happened to this country. We have created a bipartisan commission that has no elected officials on it--all experts are within their chosen fields--a commission that has both subpoena power and the funding necessary to do precisely what the 9/11 Commission did. It is structured in the same way except targeted on the investigation of the financial markets, the securities markets, the commodities markets, Freddie Mac, Fannie Mae, the financial services market, the hedge funds, and every other institution that had a part in what has been a collapse of our economic system and a great decline in the value of equity for our people, college savings for their children, and retirement for their future.

I urge colleagues to vote favorably on the creation of the Financial Markets Commission.