Economy

The subprime lending system broke down on multiple levels.  Banks, brokers and Congress encouraged people to buy homes they couldn't afford.  Properties went into foreclosure and financial institutions accumulated an enormous amount of bad debt.  The recent collapse of Lehman Brothers, the sale of Merrill Lynch to Bank of America, and the government's $85 billion bailout of AIG rocked Wall Street and revealed a widespread loss of investor confidence.

To secure our nation's financial system, Christopher is working on a bipartisan basis to pass a financial package that will restore liquidity to the markets and ensure Americans' pension plans, 401(k)s, college savings, and homes are protected.  Treasury Secretary Henry Paulson has proposed a plan that would allow the federal government to purchase $700 billion of mortgage-related assets.  However, Christopher believes taxpayers must be protected.  That's why he supports a package that includes a clear accounting of the cost, strong regulatory oversight and executive pay limits for companies assisted by the federal government.

As a senior member of the Financial Services Committee, Christopher had the foresight on the need for oversight long before the current economic crisis.  He was among the earliest and strongest advocates in Congress for stronger regulation of mortgage giants Fannie Mae and Freddie Mac.  In fact, Christopher has repeatedly noted that improved oversight and transparency of these government sponsored enterprises could have avoided the need for their recent takeover.

In 2002, Christopher and Congressman Ed Markey (D-MA) introduced the Uniformed Securities Disclosure Act, which would have required Fannie Mae and Freddie Mac to abide by the same rules as all other publicly-traded companies.  In 2003, Christopher reiterated his call for oversight when he introduced the bipartisan No Securities Left Behind Act, which would have required Fannie Mae and Freddie Mac to comply with the 1933 and 1934 securities laws.  Two years later, Christopher wrote a letter to a colleague calling for a vote on the Federal Housing Finance Reform Act, which would have created a new regulator for Fannie Mae and Freddie Mac.

Significant portions of Christopher's proposal are included in the American Housing Rescue and Foreclosure Prevention Act, which the President signed into law on July 30, 2008.  The legislation will further stabilize the country's troubled housing market by allowing more homeowners to refinance, creating a homeowners' tax credit and providing billions in neighborhood revitalization funds for communities to purchase foreclosed homes.

Christopher believes one thing we can agree on is the need to stop abusive lending practices and he's working on common sense steps to ensure the subprime loan crisis is not repeated in the future.  He voted for the Mortgage Reform and Anti-Predatory Lending Act, which establishes disclosure requirements in an effort to protect borrowers from bad loans.  We need to remember that not all subprime loans are inherently bad.  In fact, when provided to consumers who understand their terms, these loans can make homeownership affordable.

As a senior member of both the Financial Services and Oversight and Government Reform Committees, Christopher will be at the center of uncovering what happened; holding institutions accountable; and reforming the regulatory process.