WASHINGTON – U.S. Rep. Joe Barton, R-Texas, and ranking member of the House Energy and Commerce Committee, made the following statement today at the beginning of the committee’s markup of H.R. 3126, the Consumer Financial Protection Agency Act of 2009:

“Thank you, Mr. Chairman, for holding this markup of the Consumer Financial Protection Act of 2009. It is important for this committee to exercise its consumer protection jurisdiction, and many of the provisions in the bill before us today involve the consumer protection responsibilities of the Federal Trade Commission.

“I am pleased to see that some of provisions in the original bill that would have stripped jurisdiction from the FTC and given it to this new agency have been dropped or modified, so that the FTC continues to have significant consumer protection authority. As we discussed during a July subcommittee hearing on this proposal, the FTC has been the leading bright spot in federal consumer protection over the years, which reflects the fact that this committee is very active with respect to laws on consumer protection issues ranging from privacy and identity theft to financial frauds perpetrated against consumers.

“Mr. Chairman, I intend to support your manager’s amendment, which contains provisions that both sides of the aisle can support. In addition to preserving the FTC’s ability to enforce its current statutory authorities, it also ensures that FTC will have shared enforcement authority over some authorities that are being transferred to the new agency. Additionally, the FTC will be treated the same as the proposed agency and will receive notice from the CFPA anytime the CFPA initiates an enforcement action and will have the right to intervene and be heard. This improvement will ensure that the decades of experience that the FTC has in dealing with consumer protection issues can be brought to bear under this new regulatory regime.

“What I cannot ultimately support is the creation of a new super financial regulator, because I think it is the wrong response to the financial crisis and will not do anything to correct the fundamental problems that created the crisis in the first place.

“The history of the current financial crisis is still being written. It involves many problems in the mortgage lending and securities markets, the collapse of the flawed Fannie Mae and Freddie Mac, the collapse of private banks and insurers, and lax oversight by both public and private entities that allowed the world’s largest Ponzi scheme perpetrated by Bernie Madoff to occur.

“Solving these problems with one piece of legislation to shuffle the deck chairs into a new agency is not going to overcome the perils of greed and lack of morality. Scam artists will not disappear because a new agency is created. They will simply find a new way. Just last week the inspector general for the Treasury testified the level of fraud associated with the home buyers tax credit program is pervasive. So even when Congress tries to enact a “solution”, we often only create additional problems.

“My point is that Rome wasn’t built in one day. Yet it appears that, since the administration wants this, the majority is going to push through another piece of sweeping legislation that touches almost every sector of the economy, and do it with little consideration of whether this agency will actually address any of the underlying causes of the current financial crisis. I am disappointed that this committee has held only one subcommittee hearing last summer with only one industry witness, and now we are considering the bill in full committee.

“I wish I could say that this bill’s creation of a super regulator will help address the underlying problems with the housing, mortgage, securities and derivatives markets, but I cannot. Empowering a new agency with the nearly limitless power to deem almost any product or services a financial activity is a questionable approach to create a focused, targeted enforcement regime that performs better at protecting consumers.

“This legislation also fails to create a national standard; instead it adds a new layer of federal regulation on top of existing state laws, and also encourages states to go further by giving state attorneys general authority to enforce the federal law.

“Finally, the legislation gives broad new authority to the FTC that has nothing to do with the proposed agency and covers everything beyond consumer financial products. I would have preferred to consider these changes under regular order as part of an FTC reauthorization through regular order.

“I yield back.”