Federal budget much more complicated & diverse than states'
Q: [to Richardson]: Would it be a priority of your administration to balance the federal budget every year?
RICHARDSON: Well, as a governor, I have to, by law, balance budgets. I've balanced five. And it would be a major priority of mine.
DODD:
Well, listen, the federal government's much different than a state government, I say respectfully to Bill Richardson here. It's much more complicated and diverse. I've been a strong supporter, authored, in fact, pay-as-you-go budgets back in the early
1980s, which failed. I was a strong supporter of Gramm-Rudman, which is designed as well to inject some fiscal discipline into the process. So we need to have an economy here that's driving to growth, creating jobs, which is the best social program
anyone ever created. And then, simultaneously, bring an end to the war in Iraq, & begin to put that discipline back into our process. But the national government is a very different entity than a state government; requires a lot more flexibility to it.
Freeze rates on subprime mortgages to avoid foreclosures
Q: Pres. Bush proposes "mortgage rates for homeowners with spotty credit histories would be temporarily frozen under a nearly completed agreement between top Bush administration officials and a broad alliance of
Wall Street's biggest banks, mortgage investors, non-profits and consumer groups." Is this a good idea?
A: It is. In fact I made the recommendation about a month ago to the administration, and I'm glad to see they are picking up on it.
I thought this would help everybody here. If you freeze the "teaser rates"--those rates they drew people into these subprime mortgages on--that would be a good idea. And this way, the homeowner can stay there, maintain at least some payments without
losing their home and going into foreclosure. And obviously the lending institution or those that hold the mortgages would get something other than zero. So it looks to me a good solution here that would provide everyone with some relief.
Q: This week the administration proposed freezing the interest rates for a lot of sub prime mortgages around the country that are about to trend up in interest rates. The burden of that lands disproportionately on minority home owners. Some are suggestin
that merely freezing home rates for people who are in bad mortgages and can't get out just delays the reckoning that is surely going to come. Do you agree with the proposal?
A: I think it's a pretty good idea. In fact we made a similar suggestion.
Freezing that rate would allow a couple of things to happen. One, people stay in their homes. But also the financial institutions, they're better off getting 3-4% back than nothing whenever foreclosures occur. [Furthermore], I'm trying to make sure this
doesn't happen again. This was outrageous what went on here. There were no cops on the beat in this administration--they basically walked away from this and you have three times people of color in this country are being lured into sub prime lending.
Chairs Banking Committee; hedge fund managers donated $727K
Q: Regarding hedge funds. Your home state paper, the Stanford Advocate, reports: "Among Democrats running for president, Connecticut's Dodd, the Senate Banking Committee chairman who has stated his reluctance to hike taxes on hedge fund profits, leads in
political contributions, $726,950, from the booming investment sector. The tax code allows hedge fund executives to pay capital gains taxes at 15% instead of paying the personal income tax rate at 35%." You raise money from these guys, and then the
legislation which would raise their tax rate gets killed. Old time politics?
A: It hasn't been killed at all. In fact, I haven't come out even in favor or opposed. Look, there're unintended consequences to these actions. Having some idea of capital
formation of the country, having a pro-growth Democrat that cares about these issues: What happens to endowments? What happens to retirement accounts? What happens to pensions? As chairman of that committee, the responsible answer is, let's examine this.
Mortgage market has seized up; provide more market liquidity
Q: We've seen all this turmoil in the markets caused by the credit crunch and the crisis in the mortgage markets. The Federal Reserve lowered the discount rate for banks. Should they lower rates for everyone else, yes or no?
A: Yes,
I think it will happen [soon]. But we also need more liquidity. And they ought to be allowing Fannie and Freddie Mac to put more liquidity in the market. It has seized up. You can't get a mortgage in America today.
Source: 2007 Democratic primary debate on "This Week"
Aug 19, 2007
The next generation may be less well-off than us
Bush and the leadership of the House and Senate were given one of the best economies in history. Now the nation faces a deficit that soon could be as large as $4 trillion.
We run the risk, in my view, of having the next generation be less well-off than their parents and grandparents.
Source: CT Senate Debate, in Stamford Advocate
Oct 11, 2004
Voted NO on paying down federal debt by rating programs' effectiveness.
Amendment intends to pay down the Federal debt and eliminate government waste by reducing spending on programs rated ineffective by the Program Assessment Rating Tool (PART).
Proponents recommend voting YES because:
My amendment says we are going to take about $18 billion as a strong signal from the Congress that we want to support effective programs and we want the taxpayer dollars spent in a responsible way. My amendment doesn't take all of the $88 billion for the programs found by PART, realizing there may be points in time when another program is not meeting its goals and needs more money. So that flexibility is allowed in this particular amendment. It doesn't target any specific program.
Almost worse than being rated ineffective, we have programs out there that have made absolutely no effort at all to measure their results. I believe these are the worst offenders. In the following years, I hope Congress will look at those programs to create accountability.
Opponents recommend voting NO because:
The effect of this amendment will simply be to cut domestic discretionary spending $18 billion. Understand the programs that have been identified in the PART program are results not proven. Here are programs affected: Border Patrol, Coast Guard search and rescue, high-intensity drug trafficking areas, LIHEAP, rural education, child abuse prevention, and treatment. If there is a problem in those programs, they ought to be fixed. We ought not to be cutting Border Patrol, Coast Guard search and rescue, high-intensity drug trafficking areas, LIHEAP, rural education, and the rest. I urge a "no" vote.
Voted NO on $40B in reduced federal overall spending.
Vote to pass a bill that reduces federal spending by $40 billion over five years by decreasing the amount of funds spent on Medicaid, Medicare, agriculture, employee pensions, conservation, and student loans. The bill also provides a down-payment toward hurricane recovery and reconstruction costs.
Reference: Work, Marriage, and Family Promotion Reconciliation Act;
Bill S. 1932
; vote number 2005-363
on Dec 21, 2005
Voted NO on prioritizing national debt reduction below tax cuts.
Vote to table [kill] an amendment that would increase the amount of the budget that would be used to reduce the national debt by $75 billion over 5 year. The debt reduction would be offset by reducing the tax cut in the budget framework from $150 billion
Approval of the 1998 GOP Budget which would cut spending and taxes.
Status: CR Agreed to Y)78; N)22
Reference: H. Con. Res. 84 as amended;
Bill H. Con. Res. 84
; vote number 1997-92
on May 23, 1997
Voted NO on Balanced-budget constitutional amendment.
Approval of the balanced-budget constitutional amendment.
Status: Joint Resolution Defeated Y)66; N)34
Reference: S. J. Res. 1;
Bill S. J. Res. 1
; vote number 1997-24
on Mar 4, 1997
Require full disclosure about subprime mortgages.
Dodd sponsored requiring full disclosure about subprime mortgages
Sen. DODD: Today we are facing a crisis in the mortgage markets on a scale that has not been seen since the Great Depression: over 2 million homeowners face foreclosure at a loss of over $160 billion in hard-earned home equity; over one out of every 5 subprime loans is currently delinquent. These high default rates have frozen the subprime and jumbo mortgage markets and infected the capital markets to the point where central banks around the world have had to inject liquidity into the system to avoid the crisis from spreading to other segments of the market.
One of the fundamental causes of this serious crisis is abusive and predatory subprime mortgage lending. The Homeownership Preservation and Protection Act of 2007 is designed to protect American homeowners from these practices, and prevent this disaster from happening again. The legislation will:
realign the interests of the mortgage industry with borrowers to insure the availability of mortgage capital on fair terms
both for the creation and sustainability of homeownership;
establish new lending standards to ensure that loans are affordable and fair, and
provide for adequate remedies to make sure the standards are met; and create a transparent set of rules for the mortgage industry so that capital can safely return to the market without bad lending practices driving out the good.
It is important to keep in mind that only about 10% of subprime mortgages have been made to first time home buyers. This market has not been primarily about creating a new set of homeowners; a majority of subprime loans have been refinances. While maintaining access to subprime credit on fair terms is important, too much of the subprime market has actually put the homes and home equity of American families at risk.
In the coming months, the housing crisis is going to get worse. We will need to continue to press lenders and servicers to provide real relief for homeowners threatened with foreclosure.
Source: Homeownership Preservation and Protection Act (S.2452 ) 2007-S2452 on Dec 12, 2007
