Financial Services and General Government Appropriations Act, 2017

Floor Speech

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Mr. ELLISON. Mr. Chairman, we can raise living standards for working families across the country if we use Federal dollars to create good jobs.

My amendment would reprogram funds to create an Office of Good Jobs in the Treasury Department that would help ensure the Department's procurement, grant making, and regulatory decisions to encourage the creation of good, decently paid jobs, collective bargaining rights, and responsible employment practices.

Mr. Chairman, I am actually a little bit shocked to know that right now the U.S. Government is America's leading low-wage job creator, funding over 2 million poverty jobs through contracts, loans, and grants with corporate America. That is more than the total number of low-wage workers employed by Walmart and McDonald's combined.

U.S. contract workers earn so little, Mr. Chairman, that nearly 40 percent of them use public assistance, like food stamps, Section 8, and Medicaid, to feed and shelter their families. To add insult to injury, many of these low-wage U.S. contract workers are driven deeper into poverty because their employers steal their wages and break other Federal employment and labor laws.

It is intended that the appropriation for salaries and expenses at the United States Treasury Department be used to establish an Office of Good Jobs in the Department aimed at ensuring that the Department's procurement, grant-making, and regulatory decisions encourage the creation of decently paid jobs, collective bargaining rights, and responsible employment practices. The office's structure shall be substantially similar to the Centers for Faith-Based and Neighborhood Partnerships located within the Department of Education, Department of Housing and Urban Development, Department of Homeland Security, Department of Health and Human Services, Department of Labor, Department of Agriculture, and Department of Commerce, Department of Veterans Affairs, U.S. Department of State, Small Business Administration, Environmental Protection Agency, the Corporation for National and Community Service, and U.S. Agency for International Development.

Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from New York (Mr. Serrano), the ranking member.
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Mr. ELLISON. Mr. Chairman, how much time do I have remaining?

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Mr. ELLISON. Mr. Chairman, this is not duplicative. This amendment actually is not about debarment. Debarment says that, if you are the worst actor, you are going to get a sanction. This amendment says we are going to prioritize contractors who have good employment practices.

Imagine yourself being a businessperson with a government contract and you are over here trying to make sure that you are respecting the union that the workers may have. You are making sure you never get hit with wage theft. You are making sure that you have a good benefits program for your employers. You are a good employer, the kind that we want to have working for the Federal Government, yet you are competing with somebody who does the bare minimum they can do to avoid debarment.

That is the mistake that the gentleman from Florida is making. The Office of Good Jobs would prioritize good employers who make it a priority to say that we value our employees, we are not going to pay them the very least we can get by with, we are not going to try to force them on government benefits by not paying them a fair wage.

It should be compelling to all of us that 40 percent of contract workers make so little that they are eligible for government welfare programs. These are people who work. They are people who work a job. They might be working at McDonald's, they might be doing cleanup in a Federal building, or they might be doing any number of jobs; but if somebody is making meals for our heroes at the Pentagon, I think they ought to be able to get a fair, decent job, and there ought to be somebody out there who makes sure that it happens. If there is no one to make sure that it happens, it won't happen. That is why our government, today, funds more low-wage jobs than Walmart or McDonald's combined.

It is time to end this race to the bottom. It is time to say that the biggest buyer of goods and services in the world, the United States, should use its power to promote good jobs, not get-by jobs, not substandard jobs that barely eke past debarment, but good jobs.

I would think that everybody in this body would want to use the dollar that way. I think the American taxpayer would want to use the dollar that way. What if the American taxpayer knew that the Federal contractors are paying 40 percent of the workers so little that these workers actually are eligible for welfare programs though they work hard every single day?

Mr. Chairman, we ask for a ``yes'' vote on this amendment, because I think that everybody in this body wants to see good jobs for the American people.

Mr. Chair, I yield back the balance of my time.

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Mr. ELLISON. Mr. Chair, I demand a recorded vote.
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Mr. ELLISON. Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, I am pleased to join with Ranking Member Johnson to strike section 506 of this appropriations bill. This is another anti- consumer provision inserted into a funding bill. It actually doesn't belong here.

The language I ask my colleagues to remove restricts the Consumer Financial Protection Bureau's ability to curb mandatory arbitration in consumer contracts. Last month, the CFPB proposed prohibitions on class action lawsuits and mandatory pre-dispute mandatory arbitration in financial contracts.

I strongly supported the CFPB's actions. We must limit this well- known scourge on the rights of everyday Americans: forced arbitration clauses. People talk about how the rules are rigged. They say the deck is stacked in favor of powerful interests. Forced arbitration clauses are a perfect example of an unfair system. Powerful corporations rig the rules to make it more difficult for people to hold companies accountable for wrongdoing.

Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from Georgia (Mr. Johnson).
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Mr. ELLISON. Mr. Chairman, may I inquire as to how much time I have remaining?

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Mr. ELLISON. Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, if you live in Minnesota and you get into a dispute with a bank over a bank account, a credit card or a cell phone company, well, that might just be too bad because the arbitration court is in Delaware. You can pack up and move to a hotel for a week. You don't have any other option. Instead of an impartial judge, your case is going to be decided by an arbitrator chosen and paid for by the firm.

What if the arbitrator makes a mistake in ruling?

We have appellate courts for a reason. If you have forced arbitration and the arbiter makes a mistake, that is too bad for you. The ruling likely cannot be repealed or reversed.

Do you want to know what happened to other people who may have had the same problem with the company?

You are out of luck there, too, because the documents and the arbitrator's decisions are not publicly available.

This is unfair, and it is wrong. It is no way to treat consumers in our country. We should strike this improper provision. We should accord the CFPB with the respect it really does deserve because they examine this issue carefully in the public interests.

Strike section 506 of this appropriations bill. It doesn't belong there. It is anticonsumer, and both Republicans and Democrats have consumers in our districts, and I hope that they are following this debate. Because when they find that a financial product with a forced arbitration clause is hurting them and their family, they are going to know who stood up for them. I hope all Members, as they choose their vote on this particular bill, think carefully about who is on their side and who isn't.

I would just like to add, as I close, that we should split the CFPB's efforts to allow Americans to join our claims together and hold financial companies accountable when they make mistakes and when they break the law. We should encourage, not prevent, a fair financial marketplace. If you want a fair system, if you want greater economic freedom, then those mandatory arbitration clauses need to stop.

Please support the Ellison-Johnson amendment.

I yield back the balance of my time.

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Mr. ELLISON. Mr. Chairman, I thank the gentlewoman for yielding.

That is right, Mr. Chairman, $11.4 billion to over 25 million consumers. The CFPB has been working on behalf of consumers.

How many households are stronger, better off because of the CFPB? How much justice has been accorded by the CFPB? And yet here we are, after being so successful with the CFPB, and our friends on the other side of the aisle want to weaken it, water it down, snarl it up, and entangle it up in a bureaucratic mess.

It is a good thing, Mr. Chairman, that the CFPB is independent. It is good that they don't have to worry about the political pressures. It is good that they can have a single-minded focus on one thing, and one thing only: what is good for the American consumer.

By the way, we have plenty of oversight. Just ask Richard Cordray. He must be the most frequent visitor to the Financial Services Committee in the whole of the United States Government. He comes all of the time and has to answer question after question all day long, day in and day out, from our Republican colleagues, and he answers the questions as well as anybody possibly could.

There is accountability. There is a letter writing process. There are questions he has to answer. There are all types of oversight.

But do you know what? There is not the ability for the Republicans to say: We are going to snatch your money if you don't do it our way. We are going to take away your independence and tie down the CFPB in an unwieldy five-person commission if you don't do things our way.

Right now, the consumers have an advocate on their side, and that is the way it should stay. I support and urge support for the Moore amendments.

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Mr. ELLISON. Mr. Chairman, my amendment would repeal an effort to undermine the Dodd-Frank Wall Street Reform Act and an effort to eliminate consumer protections for some of the country's most vulnerable borrowers and invite a return to the kind of predatory mortgage practices that helped fuel the financial crisis of 2008 in the first place.

The manufactured housing industry is growing and highly profitable. In fact, according to its trade association, manufactured housing--what some people might call trailer homes, but actually is accurately called manufactured housing--is an industry that has recorded shipment increases in every month since 2014. Manufactured Housing for Regulatory Reform found that 2014 marked the fifth consecutive year of annual industry productions increases.

Even one of the world's most respected investors, Berkshire Hathaway chairman Warren Buffet, has been touting the profitability of manufactured housing. In a letter to shareholders, he pointed out that Clayton Homes, Berkshire Hathaway's profitable manufactured housing business subsidiary, earned a total of $585 million in 2014, an increase of 34 percent over 2013. This is despite the fact that Dodd-Frank protections that this bill seeks to roll back were in place in 2014.

Unfortunately, this is the same Clayton Homes that was the subject of a BuzzFeed and The Seattle Times and Center for Public Integrity investigation that found that this manufactured housing empire profits in every way imaginable from producing to selling, to housing, to the loans that take advantage of vulnerable consumers and leave them with virtually no way to refinance.

The investigation details a story of disabled Army veteran and Clayton Homes customer, Dorothy Mansfield. Ms. Mansfield's monthly income was less than $700, but Clayton approved her for a $60,000, 20- year loan at more than 10 percent interest. The monthly payment of $673 consumed much of Ms. Mansfield's only income--her Army disability benefit--and within 18 months of purchase, she was behind on payments and Clayton was attempting to foreclose on her home.

This is precisely the kind of predatory practices that Dodd-Frank was enacted to stop. But today, we consider legislation that would pave the way for its return.

I urge my colleagues to support this amendment and oppose the predatory manufactured housing loans.

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Mr. ELLISON. Mr. Chairman, how much time do I have remaining?

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Mr. ELLISON. Mr. Chairman, let me just be clear. This is not a matter of whether manufactured housing is good or bad. Manufactured housing is obviously an option that Americans should have available to them.

This amendment is about protecting consumers and making sure that they don't get hit on all sides of the bargain: the sale of the home, the loan, the origination, the insurance, and all over. It is making sure that the mortgage originator is operating in the interests that they are supposed to operate in--under the definition of loan originator or mortgage originator.

This requirement prevents salespeople from being incentivized to steer buyers to higher-cost loans. It is one thing to stand up and say: Hey, we are trying to help people reach the great American Dream, but it is quite another to say: Hey, look, yeah, great American Dream at a fair and affordable price, great American Dream at a price that people can actually afford and that is fair to the consumer.

So that is what we are talking about here. I absolutely believe that if people want to live in manufactured housing, they should. Let me tell you, in my district in Minnesota, I have a lot of people who live in manufactured housing.

There are a lot of success stories, too, Mr. Chairman. I can tell you about people who lived on property owned by somebody else. They bought that property that their manufactured homes were on and now it is theirs. And now they are living in much more security than they ever have. And they got a good deal.

They need people who are going to be looking out after them. This is a very, very important issue, because a lot of these folks don't have that many advocates looking out for them. We should make sure that the requirement that prevents salespeople from being able to steer buyers to high-cost loans is something that we should not tolerate. It robs families who don't have that many resources of the precious resources they have.

So this is another one looking out for consumers, affirming people's right to live in a manufactured home, if that is choice, recognizing that that is a good choice for many families, but at the same time recognizing that these same families need to be treated fairly.

Mr. Chairman, I ask for a ``yes'' vote.

I yield back the balance of my time.

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Mr. ELLISON. Mr. Chairman, I demand a recorded vote.
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Mr. ELLISON. Mr. Chairman, this is another amendment protecting consumers in manufactured housing. It strikes section 638.

Section 638 weakens rules protecting buyers of mobile homes--or manufactured homes--from being sold products that can ruin them financially. It strikes language that prevents staff at the Consumer Financial Protection Bureau from protecting buyers of manufactured homes from high-cost financing.

New manufactured homes are of good quality. However, the financing of these homes has a long and sordid history of abuse.

If a site-built homeowner can get a mortgage for 5 percent, why should a manufactured home buyer need to pay 15 percent?

If a home buyer is offered a loan of 15 percent, I think they should receive counseling that lower-cost options might be available.

Two years ago, I wrote letters to the heads of the major financing firms for manufactured homes. I asked them for information on their default rates.

Why should a buyer of a manufactured home be charged three times more than a buyer of a site-built home?

I was told by their trade association that they could share that information, but only if I promised confidentiality. I declined that because I wasn't going to be an aider and abetter to their conspiracy.

This is a paradox. The manufactured housing industry wants permission to charge consumers 10 percent above prime, so 14 or 15 percent, but they are unwilling to say why. But they say it is because that is the only way to attract lenders to the market.

Why do they need to charge manufactured home buyers an interest rate three times as high as that of other buyers? Manufactured home buyers deserve financing that lets them build equity in their home.

Last year, the Seattle Times ran a series of articles on how the financing industry used to prey on manufactured home buyers. I am glad the Democrats created the Consumer Financial Protection Bureau. Democrats gave the CFPB the authority to protect home buyers, including 17 million people who live in manufactured homes.

We have already voted on the majority's goal to stop the Consumer Financial Protection Bureau from protecting manufactured home buyers. Last year, the majority brought forward H.R. 650 with this same language; 162 Members voted against it. President Obama issued a veto threat.

The majority needs 290 votes to override a veto, and the bill only got 263. So people who want to sell buyers high fee and interest loans are trying another tack: authorizing in an appropriations bill. We should oppose their efforts on procedural grounds, but also on principle grounds.

I urge support of my amendment because absolutely everybody should get a fair shot at being able to get a piece of the American Dream, which is to own their own home, including a manufactured home. But they shouldn't have to pay three times what site-built homeowners have to pay just because they might be in a slightly different situation.

I know that colleagues might say: Oh, we are just standing up for the American Dream here; we are just trying to make sure people can get into a home.

Well, at what price, Mr. Chairman? At what price? Three times what average site-built homeowners have to pay? Three times what your average mortgage holder of a site-built home might pay? I don't think that is right.

I think that we should strike the language in section 638 and should stand up for consumer justice for those people who my colleagues agree are just trying to get a piece of the American Dream. They are just trying to get a piece of the American Dream; but, as they are doing so, there are some mortgage lenders, some lenders that are taking money out of their pockets as they are trying do that. I think the Congress of the United States should stand with those consumers and not with the big companies that make out so much, that make such an exorbitant profit at their expense.

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Mr. ELLISON. Mr. Chairman, how much time do I have remaining?

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Mr. ELLISON. Mr. Chairman, the manufactured home industry is a growing industry that is highly profitable. There are loans to be had in this space. There is no need to allow consumers to have to pay three times--three times--what people pay for a mortgage for a site-built home. This is just ringing the dinner bell on people who already are economically vulnerable.

I demanded, Mr. Chairman, information that might justify these higher interest rates for manufactured home buyers, and no information was forthcoming because there is none. This is just a chance to take advantage of people who don't have as much money as some other people.

So American Dream, by all means; consumer predation, no way. I urge a ``yes'' vote.

I yield back the balance of my time.

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Mr. ELLISON. Mr. Chairman, I thank the gentlewoman.

The way that payday loans work is that they rely on the fact that you will borrow the money, and then you have an exorbitant interest rate, and then you are going to have to borrow money to repay the last loan plus a fee and the interest rate. You roll it over and you roll it over, so before you know it, your whole check is going to pay this loan. No one has ever asked you whether you could afford it. They just took advantage of your desperate situation.

It makes sense for the CFPB to make sure people don't get caught in this cycle of debt. It is the way Americans are going to get back to financial health and not be taken advantage of when they are in a vulnerable financial state.

There are many alternatives. We need to be exploring those, not just doing it for payday lending.

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