Democratic Initiatives

Predatory and Subprime Mortgage Lending Issues- There are serious problems in our country's mortgage lending market. Foreclosure rates are rising, housing prices are stagnating and too many consumers are surprised to find out that their monthly payments are spiking. The difficulties have been concentrated in "subprime" loans, which generally go to borrowers with limited or damaged credit, although there is evidence that some borrowers are shifted into the subprime category because they are African-American or Hispanic. Real damage has been done to families and communities as many adjustable-rate mortgage loans "reset" to higher interest rates and monthly payments. The Democratic-led House Financial Services Committee has been intently focused on these issues and is working toward a balanced solution that stops abuses, preserves access to credit, and aids stable homeownership. Click here for a description of Democratic responses, press releases and documents from hearings.

Initiative to Protect Shareholders from Abuses of Executive Compensation- In March of 2007, Congressman Barney Frank, Chairman of the Financial Services Committee, introduced H.R. 1257, "The Shareholder Vote on Executive Compensation Act." The bill would require that public companies ensure that shareholders have an annual nonbinding advisory vote on their company’s executive compensation plans; and an additional nonbinding advisory vote if the company awards a new golden parachute package while simultaneously negotiating the purchase or sale of the company. H.R. 1257 is supported by many shareholder and workers rights groups and investors, including the California State Teachers’ Retirement System and the International Corporate Governance Network. Click here for description of initiative, bill language, reports on the problems of executive compensation and statements of support for the initiative.

At Issue: Retailers Purchasing Industrial Loan Corporations (ILCs)- In the past several years more and more commercial firms, including large retail companies, have begun trying to start or purchase industrial loan companies, raising concern that they will offer a wide variety of banking services and eroding the separation between banking and commerce. Chairman Barney Frank joined Rep. Paul Gillmor in submitting bipartisan legislation to close a loophole in the nation's banking laws that allow retailers and other commercial firms to own industrial loan companies (ILCs), also known as industrial banks. Click here for description of issue, bill language, press releases and related letters.

Response to the Gulf Coast Hurricanes- In the aftermath of the Gulf Coast Hurricanes, the Democratic Members of the Financial Services Committee have been active in providing both short-term and long-term solutions to housing and flood insurance for hurricane survivors. However, Democrats have been critical at the federal government's response to these natural disasters. Since the hurricanes struck and sent millions of people looking for temporary housing, the federal government's housing response has been haphazard at best. Click here for a description of Democratic response, bills, press releases and floor statements by Democratic Committee Members and copies of letters to HUD and FEMA.

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