Congressman
Ron Paul
Statement
on HR 3221
July 24, 2008
2008 Ron Paul 48:1
Madam Speaker, For several years, followers of the Austrian school of
economics have warned
that unless Congress moved to end the implicit government guarantee of
Fannie
Mae and Freddie Mac, and took other steps to disengage the US
Government from
the housing market, America would face a crisis in housing.
This crisis would force Congress to chose between authorizing a
taxpayer
bailout of Fannie and Freddie, and other measures increasing
government’s
involvement in housing, or restoring a free-market in housing by ending
government support for Fannie and Freddie and repealing all laws that
interfere
in housing. The bursting of the housing bubble, and the recent
near-collapse in
investor support for Fannie and Freddie has proven my fellow Austrians
correct.
Unfortunately, but not surprisingly, instead of ending the prior
interventions
in the housing market that are responsible for the current crisis,
Congress is
increasing the level of government intervention in the housing market.
This is the equivalent of giving a drug addict another fix,
which will
only make the necessary withdrawal more painful.
2008 Ron Paul 48:2
The
provision giving
the Treasury Secretary a blank check to purchase Fannie and Freddie
stock not
only makes the implicit government guarantee of Fannie and Freddie
explicit, it
represents another unconstitutional delegation of Congress’
Constitutional
authority to control the allocation of taxpayer dollars. While the
Treasury
Secretary has to file a report with Congress, the lack of any effective
standards for the expenditure of funds makes it impossible for Congress
to
perform effective oversight on Treasury’s expenditures.
2008 Ron Paul 48:3
HR 3221 also
takes
another troubling step toward the creation of surveillance state by
creating a
Nationwide Mortgage Licensing System and Registry. This federal
database will
contain personal information about anyone wishing to work as a “loan
originator.” “Loan originator“ is defined broadly as anyone who
”takes a residential loan application; and offers or negotiates terms
of a
residential mortgage loan for compensation or gain.“ According to some
analysts, this definition is so broad as to cover part-time clerks and
real
estate agents who receive even minimal compensation from
”originators.“
Additionally,
this database forced on industry will be funded by fees paid to the
federal
banking agencies, yet another costly burden to the American taxpayers.
2008 Ron Paul 48:4
Among the
information
that will be collected from loan originators for inclusion in the
federal
database are fingerprints.
Madam
Speaker, giving the federal government the power to force Americans who
wish to
work in real estate to submit their fingerprints to a federal database
opens the
door to numerous abuses of privacy and civil liberties and establishes
a
dangerous precedent.
Fingerprint
databases and background checks have been no deterrent to espionage and
fraud
among governmental agencies, and will likewise fail to prevent fraud in
the real
estate market.
I am amazed to see
some members who are usually outspoken advocates of civil liberties and
defenders of the Fourth Amendment support this new threat to privacy.
2008 Ron Paul 48:5
Finally, HR
3221
increases the federal debt limit by $800 billion.
We are told that CBO has scored this bill at a cost of $25
billion, but
this debt limit increase belies that.
The
Federal Reserve has already propped up the housing and financial
markets to the
tune of over $300 billion, and this raise of the debt limit indicates
that the
cost of this newest bailout will likely be even more costly.
I am dismayed that my colleagues have not learned the lessons of
the
Patriot Act and Sarbanes-Oxley.
Massive
bills passed in knee-jerk reaction to crisis events will always be
poorly
written, burdensome and expensive to taxpayers, and destructive of
liberty.
