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Public Papers - 1989

Remarks Prior to a Meeting With the Congressional Leadership on Savings and Loan Crisis Legislation

1989-06-14

The President. What I want to do was to first welcome two new members of the congressional leadership team, Dick Gephardt and Bill Gray. And just let me say, I look forward to working with you, arguing with you, working with you -- and I do mean that. And I congratulate both of you.

The purpose of the meeting today: I wanted to discuss this savings and loan bill that's going to be on the House floor. And I think that every American citizen has every right in the world to be disturbed and shocked by this situation. Tens of billions of dollars are going to have to be spent to clean up this whole matter of savings and loan, and our estimate is that it's costing about million a day for every day that action is not taken. And now some of the smaller -- or the weaker S L's, I would say, are demanding the right to continue to treat goodwill as capital, even though goodwill has no tangible value. And the result could be that -- up to 0 billion in loans without one dollar in real capital for decades to come. And in my view, it is time for the American public and our administration to say that enough is enough, and to earnestly ask for the support of the Congress. We've had good support on the Hill, and now it's getting critical. And I would simply like to ask you as leaders, both Republican and Democrat, for your support.

I wanted you to know how strongly I feel about it. I have a certain sense of obligation to the American people to get legislation through that is going to protect the people against the abuses of the past and to fix it, and fix it for once and for all. So, this is what I wanted to do. But, Mr. Speaker, I want to hear from you on this to start with, and then the leader.

Speaker Foley. Mr. President, we certainly share your view that this is critical legislation. The House will take up the rule and proceed with general debate today, and will finish the bill this week. We intend to work as long as it's required tomorrow and on Friday to see to it that the amendments are all considered and voted upon and the final action on the bill is taken before this week ends. And I can give you that assurance.

There are amendments that the House will have to consider -- 15 of them in number, down from about 107 that were requested. But I'm satisfied, Mr. President, that when the week comes to an end, there will be a strong bill from the House of Representatives and that, together with the Senate, we can send you at an early date legislation that you'll be proud to sign.

The President. Senator Dole, do you want to add anything?

Minority Leader Dole. Well, there are a lot of experts in the room here -- men, in this case, who have dealt with it from day one. But it seems to me it's sort of a time bomb that might go off one of these days unless we have a very strong piece of legislation, stripped of all the special interest amendments, and knock out the goodwill wherever you can. There isn't much good will for S L's, I find, around. [Laughter] Most of the people have been taken for a ride long enough.

So, I think I -- first, thank the President for again emphasizing the importance of this and the obligation he has to the American people. It doesn't get a lot of attention. It's only a 0 billion or 0 billion problem. But it's heartening to hear Tom Foley indicate the House is going to be tough and give us a strong bill. I know that Senator Garn and Senator Riegle and others on our side will be working toward that end in conference.

The President. It has gone through the Senate. And I would like to take this opportunity to thank Chairman [Senate Banking, Housing, Urban Affairs Committee] Riegle and Jake Garn, the guys who have raised that, and those around the table here and now -- Senator Cranston, Senator Simpson -- all. But I'm not singling out the House, but that's where the action is today.

And thank you, Mr. Speaker, for your determination to move this thing.

Note: The President spoke at 1:40 p.m. in the Cabinet Room at the White House. In his remarks, he referred to Representatives Richard A. Gephardt of Missouri and William H. Gray III of Pennsylvania, and Senators Donald W. Riegle, Jr., of Michigan and Jake Garn of Utah.

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