Senator Chris Dodd (D-CT), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, today issued the following statement in response to testimony from regulators and Administration officials before the House Financial Services Committee:

“Much of what the regulators said today underscores what we have known now for months – that action must be taken to help people keep their homes.  In fact, it was inaction and delayed response – mostly on behalf of the Administration – that got us into this situation in the first place.

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Remarks as Prepared: Today, this Committee will carefully consider recent actions taken by our federal financial regulators in response to the ongoing turmoil in our markets and our economy.  Much of our focus today will center on a period of 96 hours—mostly over the weekend of March 15^th and 16^th.  During this momentous 4-day period, the Federal Reserve, the Federal Reserve Bank of New York and the Treasury Department took dramatic and unprecedented action to stabilize our markets, to infuse them with liquidity and to prevent additional financial firms from being swept under the riptide of panic that threatened to have taken hold of our markets.

Senators Chris Dodd (D-CT) and Richard Shelby (R-AL), Chairman and Ranking Member of the Senate Committee on Banking, Housing and Urban Affairs, today announced that they have developed a bipartisan agreement to help address the nation’s housing crisis.  The legislation contains important provisions to provide counseling to Americans facing foreclosure; help local communities deal with properties in their neighborhoods that have been abandoned or foreclosed upon; and reform the Federal Housing Administration so that more Americans have access to affordable, safe, government-backed loans, among other measures.

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Senator Chris Dodd (D-CT), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, today spoke on the Senate floor on the housing crisis, the housing stimulus package proposed by Majority Leader Harry Reid (D-NV), and his efforts as Chairman to curb the unprecedented wave of foreclosures in order to help Americans keep their homes.

“The President and his advisors recently put up $30 billion of taxpayer funds to help one company on Wall Street.  That may or may not have been appropriate – I intend to investigate the deal at a Banking Committee hearing that I will chair on Thursday.  But this much is true: if the President and his advisors can find $30 billion to help one company on Wall Street, they can surely find a way to help millions of Americans facing higher mortgage payments and falling home prices. 

Senator Chris Dodd (D-CT), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, today issued the following statement on the resignation of Housing and Urban Development (HUD) Secretary Alphonso Jackson.  Just over a week ago, Senator Dodd sent a letter to President Bush calling for the resignation.

“I recently voiced my concerns about Secretary Jackson’s ability to provide the leadership necessary during these trying times for our country while under the cloud of various investigations into alleged impropriety. I hope this change in personnel will be matched by a change in policy that brings real solutions to the housing crisis that has triggered this economic recession.  I stand ready to work with the President and his new HUD Secretary to that end.”

Following hearings before their Committees in which Housing and Urban Development (HUD) Secretary Jackson continually refused to respond to direct questions,  U.S. Senator Chris Dodd (D-CT), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, and U.S. Senator Patty Murray (D-WA), Chairman of the Senate Appropriations Subcommittee on Transportation, Housing and Urban Development (THUD), today sent a letter to President Bush calling for Jackson's resignation.

“This is a balanced agreement because it allows Freddie Mac and Fannie Mae to play an immediate role in restoring liquidity and confidence to the mortgage markets, while ensuring they will be able to sustain the effort in the longer run by requiring them to raise additional capital.  I expect the two companies to use the capital not only to help the markets generally, but also to help subprime borrowers in a much more focused manner.”

“The Fed’s decision today further illustrates their commitment to using all their available monetary policy tools to provide liquidity to our markets.  But the Fed is running out of pages in its playbook to address the growing crisis of credit and confidence that has taken hold of our financial markets and threatens to undermine our nation’s economy. The Administration and Treasury should be equally aggressive in fashioning a non-monetary response that gets to the heart of this crisis – the mortgage markets. Doing so means forgoing ideology and seriously considering Congressional initiatives, like the HOPE for Homeowners proposal, which Chairman Barney Frank and I put forward last week.  The measure would provide real assistance to distressed homeowners, help stabilize our markets, and restore the flow of credit.  I intend to work in a bipartisan fashion with my colleagues in the Senate, along with the Federal Reserve and the Administration, to move the legislation as quickly as possible.”

“The Federal Reserve Bank’s latest action underscores the magnitude of the crisis facing our mortgage and credit markets.  While the Federal Reserve has acted boldly, the agency is rapidly exhausting the weapons in its arsenal.  For its part, the Administration has offered only timid measures that have done little to help families keep their homes or restore confidence to financial markets.  It is time for the Administration to embrace a more comprehensive, bold, and effective approach that goes to the heart of the current financial crisis – the mortgage markets.  Last week, I announced legislation that will provide real assistance to distressed homeowners, help stabilize our markets, and be a source of much-needed liquidity.  The legislation would provide government insurance to refinance mortgage loans and restore the flow of credit in the markets.  Until we help the people on Main Street, the problem on Wall Street will not be resolved.  I intend to work in a bipartisan fashion, along with the Federal Reserve and the Administration, to move the legislation.”