▶ 0:19:31Chair Scott: Good morning to everyone. Called us here and your order. Let me think of witnesses were taking the time and investment of your talent for this committee to appreciate the issues challenging some of the americans around the country. Appreciate you being here. Our committee seeks to answer a simple question. How do we make life more affordable for families in south carolina and frankly around the country?
▶ 0:20:01Chair Scott: That is a question that I hear all the time at home. Had to be make this economy work for families who are already working hard but too often, there is just too much at the end of the month. Housing is too expensive, food is too expensive, borrowing is too expensive. Every day life is simply too expensive.
▶ 0:20:25Chair Scott: A family in south carolina trying to buy their first home, small business owner in greenville trying to expand, or a senior citizen in rockville, south carolina living on a fixed income should not have to wonder whether washington understands what it means to choose -- I mean this sincerely -- to choose between prescriptions and groceries. Affordability is not created by government programs.
▶ 0:20:54Chair Scott: More red tape or more spending cannot afford. Affordability comes from promoting competition, innovation, and opportunity. That is why senate republicans have been focused on results that will bring relief to everyday americans. We are approaching the one-year anniversary of the work and family tax cut bill, a bill that has put more money in the pockets of americans who desperately need it.
▶ 0:21:20Chair Scott: Because of this bill, 97% of americans received a tax cut this year, 97%. And the people who benefit the most our people earning less than $200,000 a year. Hard-working american families will take home nearly $300 a month mark because of their working families tax cut bill.
▶ 0:21:45Chair Scott: Let's not forget every single democrat in the senate voted against cutting taxes which would have led to a $5 trillion tax increase. This committee has already advanced efforts to improve housing opportunity, create clear rules for digital assets, strengthen our markets, and make the financial system work better for everyday americans.
▶ 0:22:13Chair Scott: Our 21st century road to housing out with just passed the senate by historic margins, 85-4 yesterday. Almost nothing happens in the senate 85-4. We cut red tape, we are unlocking housing supply and preserving local control. I look forward to president trump sunning that legislation into law.
▶ 0:22:38Chair Scott: The genius act signed into law last year establishes a first of its kind regulatory framework for payment stablecoins fueling financial innovation in america and creating economic opportunity. The next up is solidifying american leadership in digital assets, creating a market structure legislation. I'm proud of this committee's work to advance the clarity act on a bipartisan fashion.
▶ 0:23:03Chair Scott: Beyond legislation, we have also pushed for better implementation of my credit score competition act, so millions of americans who are today credit invisible will have an opportunity to earn the kind of credit scores and interest rates that they deserve by populating all of their information on the credit scoring agencies. We have support of thoughtful regulatory rights housing that helps protect consumers without driving up the cost of credit.
▶ 0:23:37Chair Scott: Unfortunately, too many in washington still believe the answer to every problem is more government. We saw this during the biden administration, reckless spending and heavy-handed regulation made life more expensive and made it harder for businesses to invest, for lenders to serve their communities, builders to build. We should be clear, regulations have a cost.
▶ 0:24:02Chair Scott: When washington makes it harder for a bank to lend, a business to invest, a builder to build, and an entrepreneur to grow, those costs do not disappear. They show up in higher prices come if choices, and fewer opportunities for american families. That is why cutting red tape is also an affordability issue. Agencies should protect consumers, not be weaponized for political agenda.
▶ 0:24:30Chair Scott: The biden administration should never use the cfpb to target the financial sectors, restrict access, or punish those responsible lenders. That made it harder for families and small businesses to access credit while making financial products more expensive. Senate republicans are working to bring these costs down, at the same time, the biden administration was working to raise those prices.
▶ 0:25:00Chair Scott: Families in south carolina and across the country are still living with the consequences of blight and era policies and their monthly bills, mortgage payments, and their household budgets. Families do not need more slogans, they need lower cost, better opportunities, and a government that gets out of the way as americans tried to build a better life.
▶ 0:25:21Chair Scott: Today, I look forward to hearing from our witnesses about practical steps we can take to lower costs, expand opportunity, improve affordability, and reduce unnecessary regulatory burdens without going to government. Senator warren, you are now recognized.
▶ 0:25:39Sen. Warren: Thank you, Mr. chairman. Thank you for holding this hearing on affordability. Our committee has already had a big week. Yesterday, the senate passed over 21st century to housing act and now the house is on its way to passing it. This is the biggest housing bill in more than 30 years. It will help build more housing, bring down cost, and for the first time ever, stop private equity from snapping up homes that families are trying to buy.
▶ 0:26:11Sen. Warren: Your leadership help to happen. Our housing bill is an affordability accomplishment that everyone on this committee can be proud of. But it is not nearly enough to offset the economic policies of the president, and a devastating impact that they have had on american families. So let's set a baseline. When trump took office, inflation was down 3% and heading down.
▶ 0:26:38Sen. Warren: The first thing she did was slap tariffs nearly every item from nearly every country. These tariffs will cost the average american household more than $2500 this year. The supreme court struck down these tariffs as a legal, and the administration has not lifted a finger to give consumers a refund on the very high prices they pay.
▶ 0:27:05Sen. Warren: Then came trump's a legal war with iran which caused energy prices to skyrocket. The impact of the war continues to jack up costs for every single sector of our economy. Families have spent $43 billion more gasoline alone there they would have if trump had never started this war.
▶ 0:27:33Sen. Warren: Trump spent billions to cut renewable energy projects, you know, the kind of energy that would actually lower utility costs. Trump and republicans have sent health insurance premiums soaring with next year's premium hikes already on track to rival last year's record-breaking increases.
▶ 0:27:55Sen. Warren: In between these disastrous policies, it has been nonstop trumpian extravaganza of corruption and incompetence. Consumer murders that will drive up costs for everything from cable tv to credit cards, get rubberstamped under the shady as possible circumstances.
▶ 0:28:19Sen. Warren: The cfpb, which has returned more than $21 billion directly to families that have been scanned, -- scammed has been hollowed out. Doge, got rid of the team working to prevent screw worm. Now they are working to bankrupt ranchers and sent already high beef prices through the roof.
▶ 0:28:45Sen. Warren: And one white criminal after another gets doj dismissal or a trump pardon, sending a clear message that it is ok for wealthy insiders to rip off families and consumers. And what is the result? Inflation now sits at its highest level in three years, 4.2%, nearly double what it was last year. Americans are paying more for groceries, health care, gas.
▶ 0:29:17Sen. Warren: The federal reserve is forecasting higher inflation, higher interest rates, and slower growth. And the american people can see plain as day that as the economy gets worse, trump gets more chaotic. Trump focuses on building his golf course and his giant ceremonial ar getting thec righth marble for his taxpayer-funded, gold encrusted ballroom with no thought to the rising costs that are bearing down on americans.
▶ 0:29:48Sen. Warren: The same guy who ran for office stating he would tackle inflation on day one now because affordability "a hoax" and "a made up word." he says "I don't think about americans financial situations." he says that he " loves the inflation." trump doesn't care about hard-working americans, he cares about making himself richer by
▶ 0:30:19Sen. Warren: Cutting crypto deals and making thousands of stock transactions with companies whose value she can boost with deregulatory policies or giant government contracts. Trump's billionaire friends are along for the ride, they are getting richer by the hour, while american families are stuck with the bill.
▶ 0:30:41Sen. Warren: The world just got its first truly near, and the trump family's wealth is up but at least 2.3 billion dollars since just last year. Meanwhile, american's real wages since trump was sworn into office 18 months ago have fallen. Mr. chairman, I'm glad we are having this affordability hearing today. It is a stark reminder of the president's failures.
▶ 0:31:11Sen. Warren: Americans want washington to make affordability our first priority. Instead, all donald trump is offering our higher prices, more chaos, and unprecedented corruption. I look forward to our conversation today.
▶ 0:31:24Chair Scott: Thank you. I now recognize our first witness, Mr. cody carbone, chief executive officer at the digital chamber. You now have five minutes.
▶ 0:31:36Mr. Carbone: Chairman scott american member award, members of the committee, thank you for the opportunity to testify today. I'm honored to be here this morning. My name is cody carbone, chief executive officer of the digital chamber, the world's largest digital asset and blockchain trade association. Our members span more than 250 companies from the world's largest exchanges and banks to startups, innovators, builders, and developers. I'm here to talk about how digital assets can make life more affordable.
▶ 0:32:05Mr. Carbone: By calling attention to a hidden tax most families never see but they feel. The cost of moving money and the cost of moving assets. It is simply too expensive and takes too long to move money and assets today. Nearly one in four american households live paycheck-to-paycheck and the federal reserve reports more than a third couldn't cover a $400 emergency without borrowing.
▶ 0:32:30Mr. Carbone: For those families, a critic wide swipe for you or a three day hold is not just an inconvenience, it's an overdraft, late fee, or payday loan. Yet digital assets and blockchain are the first real chance indicates to help people move the money they have earned more easily, to make sending money as simple and efficient as sending an email, and to end that tax. I will discuss how digital assets can lower costs in three areas. First, the cost of moving money across borders.
▶ 0:33:02Mr. Carbone: American send more money abroad than any nation on earth. More than $100 billion last year. It costs 6.5% to send a more than double the international target, and takes three to five days to arrive. That is more than $6 billion a year skimmed on working families pockets. A worker sending $100 home to a foreign country sees only $93 and $.50 arrive.
▶ 0:33:28Mr. Carbone: However, if they were using a dollar back to stablecoin, that family keeps a full $100 and receives it in seconds. The same ball hits the freelance designer in south carolina, paid by a client in europe, or a manufacturer in ohio paying an overseas supplier, which is why business-to-business payments are altered the single largest use of stablecoin's today. The rails work and cheaper cross-border payments make american businesses more competitive.
▶ 0:33:56Mr. Carbone: Second, closer to home, more competition in everyday payments. There is a real cost embedded in how we pay today. Americans deserve more choice. A regulated stablecoin is one more option. Jupiter process, settling in seconds. It's a tool banks can offer, too. Under the bipartisan genius act, banks themselves can issue these products.
▶ 0:34:19Mr. Carbone: This isn't about taking anything from the system we have come it is leading a cheaper, compliant rail compete so a merchant can pass a discount to customers at the register. Third, the biggest part is most families will ever make, a home. Today, thousands of dollars vanish into the process of transferring a home. Closing costs of up to 5%, often more than $10,000, much of it just to establish who owns what and to move money. Tokenization the text that directly.
▶ 0:34:49Mr. Carbone: It records ownership clearly, settles in seconds instead of weeks, and strips out the layers of middlemen. Independent analysts estimate that cut up tokenization can cut transaction costs by 35 to 65%. This is big in housing but the same approach reaches car titles, equities, treasury, small business invoices, and more. It opens the door the other way, too.
▶ 0:35:17Mr. Carbone: Tokenization provides fractional ownership with less a family on a piece of a wealth building asset or as little as a dollar instead of being locked out. Tokenization israel, its growing, and the savings are proving in the institutions using it today. This committee deserves real credit. The genius act is working. Finishing the job through the clarity act is the best chance congress has had to set clear goals of the road. Clarity is closer than it's ever been and I urge the senate to finish it this year.
▶ 0:35:47Mr. Carbone: Clearer, U.S.-based rules are what unlocked tokenization for ordinary americans, keeping this activity on shore and keeping good paying jobs. In the end, the cost of moving money and moving assets israel. It shows up in every household budget. The digital chamber is proud of our role in helping americans shed that burden and working with this committee. Thank you for your time, Mr. chairman, ranking member warren. I look forward to your questions.
▶ 0:36:12Chair Scott: Thank you. The next witness is Mr. kevin brown, president of the national association of realtors. You are recognize. Thank you all for your support of the housing bill.
▶ 0:36:22Mr. Brown: Thank you, chairman scott, ranking member warren. Thank you for inviting me to testify at today's hearing on america's affordability agenda. My name is kevin brown, the two thousand 26 president of the national association of realtors come the largest trade association in the country with nearly 1.5 million members. I'm also a broker owner with better homes realty, open california.
▶ 0:36:48Mr. Brown: Every day, realtors work with families who have saved and worked hard and maintain good credit still cannot find an affordable home. The numbers are staggering. Housing remains one of the largest drivers of economic growth in the country, making up nearly a fifth of the U.S. economy, but the supply of homes to purchase has collapsed.
▶ 0:37:11Mr. Brown: The american population has grown nearly 30% since 1995, yet the existing household stock has actually dropped more than 25% from 1.58 million units in 1995 to 1.18 units today. The median annual home price has skyrocketed to over $400,000 and the average age of a first-time homebuyer is now 40 years old. This is not sustainable. Angrily, under the leadership of this committee, meaningful changes are underway.
▶ 0:37:42Mr. Brown: The 21st century road to housing act is the most consequential housing legislation in decades. The bill strengthens many existing programs and streamlines others while cutting red tape and removing barriers to housing development. In particular, the bill reforms federal housing programs such as the home investment partnership program and the community development block grant program to be more flexible and effective.
▶ 0:38:07Mr. Brown: The legislation modernizes financing for rural manufacturer and modular housing and updates fha multifamily loan limits to reflect today's market. It also streamlines federal environmental reviews and increases coordination across agencies. On the state and local side, it provides resources and incentives not mandates to help communities build and preserve homes.
▶ 0:38:30Mr. Brown: The housing supply frameworks act act requires hud to work with stakeholders to develop guidelines and best practices for addressing zoning policies that block housing production. The bill includes funding to develop pre-reviewed design libraries of adus, duplexes, townhouses that can streamline permitting.
▶ 0:38:51Mr. Brown: It also creates planning grants to support affordable housing strategies at every level of government that a home renovation pilot to help families preserve the home that they already own. The house and senate now agree. We look forward to this legislation being signed into law at into other successful reforms from congress such as opportunity zones and low income housing tax credits.
▶ 0:39:16Mr. Brown: We know the 21st century road to housing act will have the same meaningful impact but as we all know, there is more work to be done. We know it will take time to build more homes but we also need to ensure that communities don't adopt shortsighted, quick fix things to address affordability.
▶ 0:39:34Mr. Brown: In my home state of california, we have seen policies that do more harm than good, while solutions like rent control may be popular, the on the ground results only water down personal property wraps, discourage development, and push mom and pop housing providers from the market. Property owners work best when property rights are strong. That is what allows consumers to build and protect the equity, the foundation of long-term wealth.
▶ 0:40:01Mr. Brown: While rent control may be seen as a way to protect tenants, in practice, it limits housing opportunities and makes it more expensive. This is why it's critical the federal government take the lead in meaningful lasting solutions. Realtors are working with congress on additional reforms and policies such as more homes on the market act, a bipartisan bill that would double the capital gains exclusion threshold on a primary residence for first time -- for the first time in nearly 30 years while adjusting the caps to reflect
▶ 0:40:32Mr. Brown: Future inflation. Just like people locked into their homes and lower interest rates, seniors are often locked in because of home equity penalty. This legislation expands existing housing stock and gives seniors opportunity to tap equity that they have counted on for retirement. In turn, buyers can then buy homes, freeing up housing for first-time homebuyers. Additionally, policy solutions are included in my written testimony.
▶ 0:41:02Mr. Brown: We know there is no silver bullet that will quickly fix the supply and affordability crisis, but the solution this committee has championed will help the housing market for decades to come. Thank you, chairman scott, ranking member warren. I look forward to your questions.
▶ 0:41:16Chair Scott: Thank. Next we will hear from Dr. morgan, president of the century foundation. You are now recognized.
▶ 0:41:24Dr. Morgan: Chairman scott, ranking member warren, thank you for inviting me to testify before the committee today. As a public policy think tank committed to improve the lives of americans, the century foundation have been focused on how the costs are affecting working families. While president trump is calling affordability a hoax or a fake word, confessing that he does not think about americans financial situation, families are dealing every single day with the cost of the living christ as the donald trump promised he would fix.
▶ 0:41:54Dr. Morgan: From his first days in office, president trump has gone back on his campaign promises, labor and one price hike on top of another. Starting on so-called liberation day last april, the trump administration set off a series of tariffs that have cost american consumers an average of 1700 dollars, increasing prices on a wide variety of must-have items from groceries, clothing, school supplies, to building materials and electronics.
▶ 0:42:20Dr. Morgan: The trump administration and republicans in congress pushed through massive tax cuts for the wealthiest americans paid for by increasing the cost of health care, higher education, energy, and food for ordinary families. While the wealthiest americans got a boost, those tax cuts for the ultrarich because the lowest income families about $1200 a year.
▶ 0:42:40Dr. Morgan: In fact, any benefits the average families may have seen from trump's tax plan were wiped out by a war with iran that is keeping gas prices at nearly four dollars per gallon and has cost families an estimated $100 billion. On the trump administration's watch, some of the biggest expenses were ordinary families have become even less affordable.
▶ 0:43:00Dr. Morgan: New car prices hit record highs, health insurance premiums have spiked, home prices rose again this last year, and rent and mortgage payments both remain on mark -- alarmingly high. Prices are only one side of the equation on affordability. Wages are the other. The president has directly cut the wages for home health workers and farmworkers, wreaked havoc on the agencies responsible for ensuring that workers can exercise their rights. In 2025, ushered in the worst year of job growth since 2020.
▶ 0:43:31Dr. Morgan: The cumulative impact of these policies have been disastrous for working families. Our research shows half of americans report skipping on health care services or taking on debt to deal with their rising health care costs. Have to tap into savings to meet their day-to-day expenses. One and in three respondents reported they had, or someone in their household, had skipped meals to save money in the past year.
▶ 0:43:56Dr. Morgan: Americans are increasingly forced to use debt to make ends meet but high cost loans are pushing families farther over the edge. Outstanding credit card balances stand at around one point 25 trillion dollars with delinquency rates of more than 13%, the highest level since the great recession. Student loan to liquids he said also shot up under the trump administration from nearly zero to about 25%.
▶ 0:44:20Dr. Morgan: Auto debt has exploded in bankruptcy filings increased almost 12% between 2025 and 2026, home foreclosure filings are up 26% from last year and are at the highest they have been since 2020. This mountain of debt as a new dimension to the affordability crisis. Driving down the prices of individual goods answer is as more fully alleviate the pain that families are feeling or the dragon places on the economy.
▶ 0:44:45Dr. Morgan: Lower gas prices next week don't mean all that much when you're still paying off your price at the pump from the last week or last month groceries at a 24% interest rate. Not everyone is losing in the trump economy. The trump administration has engaged in a relentless corrupt agenda of self enrichment, deregulation, corporate pardons, and sweetheart deals for the wealthy and well-connected.
▶ 0:45:10Dr. Morgan: Some of the definition areas are represented in the room like the banks who continue to derive excess profits from overdraft and credit card late fees that cost consumers $15 billion a year. This committee has the power to advance legislation that would help save americans billions of dollars. I applaud you all for starting with housing, an area of critical need, and I saw this morning senator warren and senator moreno are working to save social security as well.
▶ 0:45:37Dr. Morgan: But with 110 million americans unable to pay off their credit card balances each month and banks taking massive profits into high interest rates, there is much more to be done. The affordability crisis is not a hoax, it is a backbreaking reality for the vast majority of americans. This committee must take action to address it. I look forward to your questions. Thank you.
▶ 0:45:58Chair Scott: Thank you, ma'am. We will now hear from Ms. lindsey johnson, community bankers association.
▶ 0:46:12Ms. Johnson: Chairman scott, ranking member warren, members of the community, thank you for the opportunity to testify. My name is lindsey johnson, the president and ceo of the consumer bankers association. For as long as there has been an american economy, banks have helped families and small businesses build within it. That work often begins with something simple, safeguarding a paycheck. It grows from there. Banks take deposits and put them to work in communities, helping consumers establish credit, financing education, by a car, purchase a home, or start or expand a small business.
▶ 0:46:43Ms. Johnson: For millions and millions of americans, a credit card or small loan can take a family from credit invisibility to financial opportunity. The same is true for small businesses. Many begin with the founder's personal credit card grown into a small business loan, term into an enterprise that takes payments, hires employees, and serves their communities. At every stage, banks are alongside them. But the true measure of a bank is not just what it does in goods, it's what it provides when life doesn't go it according to plan.
▶ 0:47:13Ms. Johnson: When a paycheck and a bill don't line up, when a car breaks down or when hours are cut, bank products can be the bridge between a difficult month and a genuine crisis. A credit card and overdraft service, home equity line of credit can help a family absorb a shock, stay current, and keep moving forward. Banks often provide another layer of support for consumers they may not see. Fraud prevention, payment security, technology that makes modern commerce possible.
▶ 0:47:40Ms. Johnson: Banks do well when consumers, small businesses, and consumers do well. Today's economy and consumers are remarkably resilient, but affordability is a real concern for many families as essentials like housing, health care, food, and transportation, what we refer to in a written testimony as the four horsemen of affordability continued to pressure household budgets. As costs have risen, families at the bottom of the k-shaped economy feel it more acutely.
▶ 0:48:07Ms. Johnson: Consider the median household making $68,000 after taxes, $5,700 a month. Essentials like housing, vehicles, health care comprise around two thirds of the budget. If you add childcare, that is 75% of the budget before utilities, gasoline, retirement savings, or other recurrent costs. By years end, this household has a net savings of $45 a month. It's in a month. It's an infinitely thin margin were a single expense can upend a family budget.
▶ 0:48:37Ms. Johnson: Then he 5% of americans experience at least one expense shock a year, on average around $5,000. For consumers like this, low cost financial products from main street banks can help manage and smooth out those unexpected expenses. Conversely, credit cards and other products and services serve as shock absorbers comprise a very small amount of the consumer's budget. As credit card interest accounted for roughly 1% on average of a household budget in 2024.
▶ 0:49:07Ms. Johnson: Overdraft and other fees are even less. Congress and the administration deserve credit for inventing solutions focused on core source of affordability challenges including pending bank capital rules that will enhance a bank's ability to lend, bipartisan work on housing expansion and supply, support for small business lending. We also appreciate the focus on fraud and scams, a fast-growing prep costing americans billions every year.
▶ 0:49:35Ms. Johnson: Combating it requires stronger coordination, accountability, law enforcement engagement, and more engagement across technology, telecom, marketplaces. As policymakers consider additional solutions, it is so critical to to preserve the financial tools that help families manage those expenses. Quick fixes like credit card rate caps may seem appealing but they don't reduce access to credit and they make it harder for consumers who need it most to access the credit and instead pushes into less regulated alternatives.
▶ 0:50:06Ms. Johnson: A better approach and detailed in my written testimony is to address affordability challenges at the resource while maintaining responsible access to credit. Banks cannot solve structural affordability and income challenges alone. But we can and do help families manage through them. Ensuring access to essential credit and liquidity in a competitive and sustainable way. The last six years have had some of the most unprecedented challenges to the economy and consumers in modern history.
▶ 0:50:35Ms. Johnson: Yet, banks of all -- businesses, communities, and the broader economy as banks were the driving force in the fastest post-pandemic recovery in modern history. Banks will continue to serve as foundational partners in american life and will support stability and help families achieve their own american dream. Thank you again. I welcome your questions.
▶ 0:51:00Chair Scott: Thank you very much. You each member of the committee will have an opportunity to ask questions to any of the witnesses were up to five minutes, and then we will move on. I will start. One of the things I center my opening comments was that because of the working families tax cut bill, 97% of americans saw their taxes go down, and the focus of those taxes decreases
▶ 0:51:31Chair Scott: Were around people making around $200,000 a year. 100% of democrats voted against the tax cuts for 97% of americans. $5 trillion is just a mindnumbing amount. But $250 a month is something I can understand.
▶ 0:51:55Chair Scott: Giving americans 250 additional dollars because of our working families tax cut bill that showed up in tax returns, increased on average 11%, is just another way the republican majority is working on behalf of the american people, making 2026 the year of affordability, working in the right direction. I would also add to that, comparisons matter.
▶ 0:52:24Chair Scott: The contrast between the biden administration for the average family losing more than $1000 of purchasing power amount and inflation, as high as 9%. By the way, don't forget, gas prices, june 2022, $4.88 a gallon on average.
▶ 0:52:49Chair Scott: On top of all of that, one of the most oppressive regulatory environments in modern history brought to us by the biden administration. Digging out of that hole has taken time, without question.
▶ 0:53:08Chair Scott: When I think about the regulatory burden put on top of the average person in this country, I think about the regulatory options like basel I ii, initiatives come to the table that we were able to dodge that really devastating bullet to the american people. Most people may not be as familiar, lindsey johnson, as you are with the basel iii provision.
▶ 0:53:38Chair Scott: My understanding is that the more money you park on the sidelines, the fewer dollars you have for first-time homebuyers, starting a small business, purchasing a car. Add on top of that one regulatory option, another month with cfpb, spying on businesses, looking for ways to bring more pain into the lives of working-class small business
▶ 0:54:08Chair Scott: Folks. Trying to make their ends meet. That regulatory pressure on top of the economic uncertainty created an instability I'm not sure that we fully appreciate or have absorbed completely. Thoughts, Ms. johnson?
▶ 0:54:25Ms. Johnson: I will start with the conversation around basael, capital proposals, regulation generally. Your comment is right. We have to get that balance between safety and soundness and allowing a bank to be a bank. Wanting a bank to compete with all of the other nonbanks in the atmosphere. More competition means more safe product options.
▶ 0:54:49Ms. Johnson: What we saw before under the basel iii proposal released in 2023 was something that outstripped even international standards. It would have made U.S. banks less competitive, pushed banks outside of a certain lending segment. Banks are already a much smaller portion of the debt market than they were before. The more we can get the competition in the marketplace, a lower cost, the cost of the lower because that is what competition is there for.
▶ 0:55:19Ms. Johnson: That is one example. On the cfpb, we need a cfpb that is credible and durable and stable. We need a cfpb that is a true cost benefit analysis, rigorous cost-benefit analysis to understand how the rules it is writing will actually impact consumers. I often times, whether with credit card late fees or overdraft, they simply overlooked it. Consumers will lose access to these products by their own admission on credit card late fees. 74% of people would see their costs go up.
▶ 0:55:50Ms. Johnson: The small portion of people who are frequent late payers would see some benefits but they didn't take into account their credit score was going to be hurt long-term, driving their costs up. We have to do a better job of having an honest conversation that is apolitical at these agencies so we can drive savings.to consumers
▶ 0:56:07Chair Scott: With the time I have left, 30 seconds. I am the chair, so I cannot tell time. Mr. brown, you said you had more solutions in your written comments. In 15 seconds, can you provide us with one solution you think would make housing more affordable that you have not heard so far?
▶ 0:56:26Mr. Brown: More homes on the market act, which is also a bipartisan bill before congress, provides for a doubling of capital gains. Capital gains exemption from 250 and $500,000 for a married couple to $500,000 for a single person, $1 million for a married couple. There are people on the sidelines waiting because they either don't want to pay the tax or cannot afford to pay the tax. That would free up inventory.
▶ 0:56:57Mr. Brown: There would be instant inventory into a marketplace where buyers would come in, buy the property which would free up some housing for first-time homebuyers. Thank you for your work on that.
▶ 0:57:09Chair Scott: I appreciate that.
▶ 0:57:12Sen. Warren: Thank you, Mr. chairman. I am glad we are holding a hearing about president trump's affordability agenda. I am glad my republican colleagues don't seem to agree with president trump's claim last week that affordability is a fake word made up by democrats. In fact, I want to ask our witnesses about that. Raise your hand if you agree with the president that affordability is a hoax made up by democrats.
▶ 0:57:44Sen. Warren: I am giving you time here. Ok. No hands up. I assume that means none of you. Democrats or republicans agree with president trump at the affordability crisis facing american families is a hoax. That seems right to me.
▶ 0:58:02Sen. Warren: President trump's agenda has driven cost so that families are putting more of everything, from groceries to gas on their credit cards, trump's own top economic adviser, kevin hassett, recently bragged that "credit card spending is through the roof." he is right. Over 100 million americans have credit card debt now. Many of them putting groceries and gas on credit cards just to be able to make it to the end of the month.
▶ 0:58:32Sen. Warren: Delinquencies are at the highest level since the crash of 2008. So let's talk about affordability. In january, president trump promised to cap credit card interest rates. He politely asked the biggest banks to put in place a one-year 10% cap by january 20. Ms. johnson, your organization represent some of the biggest banks in the country.
▶ 0:59:00Sen. Warren: We are more than five months past trump's january 20 deadline. Which banks have implemented the one-year 10% cap on credit card interest rates that president trump promised to deliver?
▶ 0:59:16Ms. Johnson: Thank you for the question. There are a couple of things I would love to say. One, banks offer 0% apr today.
▶ 0:59:24Sen. Warren: I'm sorry, I asked a specific question. Donald trump told banks that they should lower their credit card interest rates to 10% by january 20. He said that is what he would deliver for the american people, promised it to everyone in america. I just want which banks have actually lowered their credit card interest rates to 10%? Can you give me their names?
▶ 0:59:48Ms. Johnson: There are the only option that are low cost apr.
▶ 0:59:52Sen. Warren: Which banks have lower their interest rate on credit card to 10%? Are there any at 10%, can you name one?
▶ 1:00:01Ms. Johnson: I can tell you their option today --
▶ 1:00:05Sen. Warren: One bank that has lowered its credit card interest rate, as president trump politely asked, has there been one? Has there been one? Has there been one?
▶ 1:00:19Ms. Johnson: There are options in the marketplace.
▶ 1:00:22Sen. Warren: So not a single one has followed through on what president trump told them to do. So president trump and the big banks don't provide a 10% cap on credit cards. Ms. johnson, how much more have americans paid in interest on credit cards than they would have paid if the cap the president promised had taken effect? What is the number?
▶ 1:00:48Ms. Johnson: Again, I want to go back --
▶ 1:00:51Sen. Warren: What is the number? I bet you have not done the calculation. I have. It is $57 billion in credit card interest rate above 10%. Americans have paid since january 20. By the way, if you do the math, that is $368 million a day.
▶ 1:01:15Sen. Warren: President trump promised he was going to make banks lower interest -- credit card interest rates for families by january 20, and so far, families have been paying 368 million dollars a day for donald trump's broken promise. We know that families have less money to spend, they are falling behind on their bills, thanks to donald trump's economic policies. Dr. morgan, if you can tell me briefly, how are people coping with these tighter finances?
▶ 1:01:44Dr. Morgan: Families are really struggling. As I said earlier, one in three are skipping meals, skipping medication that are prescribed by their doctors, they are skimping on health care services, and they are turning to debt. That's important to know that is a both and. People are cutting back on the things that they need to live their lives and also putting their expenses onto high cost debt, credit cards, buy now, pay letter, paycheck advance loans.
▶ 1:02:13Sen. Warren: President trump may love inflation, but it is killing american families. Congress needs to work together to fix the president's failed economic agenda and to make life more affordable for all americans. Thank you, Mr. chairman. >> thank you, Mr. chairman. I really appreciate the fact that the chairman and the ranking member hassan come together to have this discussion on where the costs are right now for american consumers.
▶ 1:02:44Sen. Warren: I think it's really important that we talked about all of the impacts. I noted there is always a desire to have your cake and eat it, too, and sometimes less than possible, particularly when we talk about how to go about financing activities in our daily lives. I'm just curious, Ms. johnson, you represent a lot of banks, the issue a lot of credit. How many people today have credit cards in america?
▶ 1:03:14Ms. Johnson: Almost 282 million people have credit cards.
▶ 1:03:19Sen. Rounds: 282 million people have credit cards today. Can you imagine not having credit and being able to survive in today's digital economy? Just curious, -- we use them to get on an aircraft, but we also use them to do digital shopping, anything over the internet at all, telephones we pay for with a credit card in most cases.
▶ 1:03:49Sen. Rounds: Just thinking aback about this, one of the greatest threats to a lot of people being able to survive on a day-to-day basis is they could not get credit. Just curious, I think the president wanted to find a way to try to suggest that he wanted the marketing side of things to be able to be incentivizing, offering people low interest rates. But a lot of credit card companies offer 0% interest rates for short periods of time.
▶ 1:04:18Sen. Rounds: Can you talk about what would happen -- and I presume you have done the work because represent the banks that really issue these cards. What would be the impact if government were to step in and artificially say, you have to have an interest rate of 10% or less on credit cards? What would have been to the number of people that would have the availability of credit cards today?
▶ 1:04:45Ms. Johnson: Such an important question and the right question. Is the best way to make sure that someone with only an eight hundred credit score has access to credit.
▶ 1:04:55Sen. Rounds: So how many people have, or how many people don't have an 800 credit score today out of those hundreds of millions of people without credit cards?
▶ 1:05:08Ms. Johnson: It would restrict credit for about 75 to 80% of the current market.
▶ 1:05:13Sen. Rounds: 75 to 80% of the current credit card holders. How would that happen? Would they simply lose it on day one?
▶ 1:05:25Ms. Johnson: It would be fairly immediate. Ultimately, risk-based pricing allows issuers -- and there are 4000 plus issuers that compete for consumers business every single day -- to go out there and make sure consumers have access to this necessary liquidity and source of credit in a very sustainable way. You cannot do that for free. Part of that is making sure that we have plenty of options.
▶ 1:05:53Ms. Johnson: You mentioned you represent balanced transfers, over $60 billion in balanced transfers in 2024 alone. We are focused on making sure consumers understand those different options. To simply take away a source of credit for consumers seems incredibly punitive.
▶ 1:06:09Sen. Rounds: In the 1980's, we had a tough time on the ag markets in south dakota. We had usury rates in place, and because we had usury rates in place, there were banks that simply would not loan to farmers anymore because it was a tough time. A lot of the guys were struggling.
▶ 1:06:33Sen. Rounds: In order to put seat in the ground for spring of that year, -- village engels was governor at the time. He said, I don't care if it costs more, we have to give these guys some credit so they can put their crop in the ground. It is the reason why south dakota at that time eliminated the usury rate. Banks charged more than traditional usury rate was. We had farmers that survived because they could actually borrow the money.
▶ 1:07:01Sen. Rounds: My concern with this whole discussion is, you say we have over 4000 different banks issuing credit cards today. It seems to me these folks with these great ideas about issuing 10% credit rates, out of the 4000, I'm sure one or two of them could do that today, but I'm curious why we don't have new startups by these folks that have new ideas and they could issue 10%, in fact, they can go to 8% and get a lot of people coming in.
▶ 1:07:30Sen. Rounds: I wonder how long they could continue to offer that rate based on the individuals that might not be able to qualify for a regular card but would love to have that interest rate. Is there a reason why we don't have a lot of people offering that 10% interest rate today?
▶ 1:07:45Ms. Johnson: It is simply not sustainable. The bursting we can do for the consumer is extend to them a product they cannot afford to pay back. I do want to push back on a couple of the different comments about the overall balances.
▶ 1:08:00Chair Scott: 10 seconds.
▶ 1:08:03Sen. Rounds: Can you loan me 30 seconds?
▶ 1:08:06Ms. Johnson: One of the most important things to understand, through the pandemic, over the last six years, really eight years, 40 million new people came into this market. When we talk about balances being $1.2 trillion, that is because we have a lot more people who had access to this very important source of liquidity. You did have higher prices, so balances also went up. That is what drove apr's.
▶ 1:08:36Ms. Johnson: Apr's are not a big profit, that is how we extend credit.
▶ 1:08:39Sen. Rounds: Thank you, Mr. chairman.
▶ 1:08:44Sen. Van Hollen: , thank you, Mr. chairman, thank you for holding the hearing. I think it is indisputable that families all over the country are seeing prices and costs go up. In president trump's first year, families. Three hundred 10 more dollars for groceries than they did in 2024, $110 more in electric bills than the year before.
▶ 1:09:07Sen. Van Hollen: I think we all recognize the economy is complex and price increases cannot always be attributed to the policies of the president or administration. In this case, it is pretty clear they can be. Because of the president's tariffs, families have paid $1700 more in tariff costs. Gas prices are up 40% thanks to president trump's catastrophic war in iran.
▶ 1:09:36Sen. Van Hollen: So as of last month, inflation now stands at 4.2% annualized rate, which is the fastest growth in three years. We have heard president trump say recently that he "loves inflation." he has also said that affordability is a fake weren't made up by democrats. Dr.
▶ 1:09:58Sen. Van Hollen: Morgan, just to level set on facts, is the affordability crisis a hoax made up by democrats, or are people experiencing price increases because of the trump administration's policies?
▶ 1:10:11Dr. Morgan: It is not a hoax, it is something families are dealing with every single day.
▶ 1:10:16Sen. Van Hollen: I want to talk briefly about the other side of the affordability equation. On the one hand, we all face costs and prices. On the other hand, our ability to afford them depends on the income we have got, what money we have got in our pockets or bank accounts. I do think it is worth taking another look at what was president trump's signature legislative policy accomplishment.
▶ 1:10:45Sen. Van Hollen: He would call it and a compliment, I thought it was bad for the country. That was what they call their big beautiful bill, which provided huge tax cuts to the very wealthy at the expense of everybody else. Dr. morgan, it is correct to say that the wealthiest taxpayers benefited the most from the so-called big beautiful bill, right?
▶ 1:11:07Dr. Morgan: That's correct. The wealthiest taxpayer benefited the most in the bill cost the lowest income families money because of costs to medicaid, snap, other programs.
▶ 1:11:19Sen. Van Hollen: Just to emphasize the point, I think we should look at this chart that shows that the richest 1% of income earners got 22% of the benefit of those tax cuts. Overall, the top 20% income earners got 72%.
▶ 1:11:42Sen. Van Hollen: I will also say, this distorts the picture over time because some of the tax cuts that went to middle class families included things like the no tax on tips, which is actually a good idea, but if you're in that income level and your income is not just in the form of tips, you should also get a break. But those were all sunset. Those tax cuts for working people are going to sunset in a couple of years. This will get even worse in terms of the distribution impact.
▶ 1:12:12Sen. Van Hollen: In fact, so bad is the situation, the white house tried to reframe and re-label its bill on the working families tax cut act.
▶ 1:12:26Sen. Van Hollen: I mentioned that because I have introduced a piece of legislation called the working americans tax cut act that gives 100% of the tax cut benefits to people who are not in the top 20%, compared to the trump republican plan that gives 72% of the benefits to people who are in the top 20%. With my remaining time, let me turn to overdraft fees. Families paid more than $12 billion in overdraft fees last year. They can often be small.
▶ 1:12:56Sen. Van Hollen: You can get a cup of coffee and not realize that your three dollar cup of coffee ended up getting you a $35 overdraft fee. Banks love these. The rates can be as high as 16% effective annual interest.
▶ 1:13:15Sen. Van Hollen: In fact, they did so well that there was one middle bank executive who is bank raked in so much on overdraft fees, they named their boat " overdraft." in 2024, cpb tried to rein these costs in, but when the trump administration came in, they lifted it. The impact has been $12 billion in overdraft fees. Isn't it true, Dr.
▶ 1:13:44Sen. Van Hollen: Morgan, that overturned these rules hurt consumers, help to boost bank profits?
▶ 1:13:51Dr. Morgan: Absolutely. The cost to americans for dialing back this rule is about $5 billion. I think it's really important to put this in the context of what we are hearing from the representatives of the banks here today. The banks will frame overdraft fees as something that is necessary to provide a service, but overdraft used to be a courtesy to bank customers, and it has turned into a profit center for the banks.
▶ 1:14:20Dr. Morgan: We see the banks and their lobbyists fighting hard to keep these fees in place in order to maintain those profits at the expense of consumers. Then we see the trump cfpb shifting from an organization that were presented consumers to an organization that resents industry interests.
▶ 1:14:35Chair Scott: Senator tillis.
▶ 1:14:40Sen. Tillis: Thank
▶ 1:14:45Sen. Tillis: Have you looked at what I consider to be largely failed attempts to cap credit card rates in other jurisdictions?
▶ 1:14:54Ms. Johnson: We certainly have.
▶ 1:14:55Sen. Tillis: Any idea?
▶ 1:14:57Ms. Johnson: Look, it never worked. We have a ton of data, we have a ton of history to learn from. Illinois is a great example.
▶ 1:15:03Sen. Tillis: I was about to ask you about illinois. What I've seen in illinois as the example, at least one, I believe, the other cosponsor, so this is not just a democrat-republican thing. We have an honest disagreement among republicans. Go through a few of the things that happened when illinois did the arbitrary rate cap.
▶ 1:15:24Ms. Johnson: They even had a 6% all-in rate cap, and what ultimately happened was nearly 40% of sub prime borrowers simply lost access.
▶ 1:15:34Sen. Tillis: 44%. Let's see, loans to sub prime borrowers decreased by 44%. Loans to deep sub prime borrowers decreased by 57%. 40%, let's see, financial well-being dropped by 40%. 11% reported an improvement. So doesn't look like it's something that you consider to be a best practice, does it?
▶ 1:15:56Ms. Johnson: No.
▶ 1:15:57Sen. Tillis: Has this been implemented in any other countries that you've studied?
▶ 1:16:03Ms. Johnson: There's --
▶ 1:16:04Sen. Tillis: How were the results there? Remarkably similar, right? It's like, my god.
▶ 1:16:10Ms. Johnson: Time and time again.
▶ 1:16:11Sen. Tillis: I don't care which release it is, whether it's "toy story 1" or "toy story 5", my god, it's not going to end any differently. I don't know why we're having this discussion. And then the whole concept of not being able to rate for risk. In anything.
▶ 1:16:30Ms. Johnson: It's so important.
▶ 1:16:31Sen. Tillis: You're helping people from themselves. I get it used to be an early draft, an overdraft fee use to be a court simple last time I checked, a lot of the banks still give you one or two passes. But what if it becomes a chronic problem? At what point are you expected to know what's in your bank account before you write a check? That's what this is. It's nothing more than that. It's financial literacy. I'll put money into financial literally.
▶ 1:16:57Sen. Tillis: I'll put money into real-time, don't write this check because you've gone over the customary limit that banks will actually write off. Serve talking about banks get you, it's a profit center. I don't know of any bank that doesn't give you a forbearance on the first two, three, four, five overdraft fees. But folks, at what point do you have to own responsibility for a bank account? To me it's that simple. But maybe I just don't get it.
▶ 1:17:28Sen. Tillis: We talk about affordability as if it's something new. And that's bo -- that's bo gus, too. Affordability is a problem. It's a matter of where it is on the margins. I've said this repeatedly in this committee. I know when I had an affordability problem, it's when we weren't living in a house anymore. We were living in a trailer. I saw the overreach of regulatory environment and the carter administration put me back in a trailer park, because they were well intentioned, but poorly implemented policies.
▶ 1:17:58Sen. Tillis: Every time we tried artificially gloss over some of the problems that we have here with financial literacy, making sure that people really understand to spend within their means, government tries to help me out, and I'll be damned if it's not the time to send me back to the trailer park. When we start paying attention to the people who are really on the bubble, and I'll tell you right now, we got a real problem, because we have rich people making a lot of money. But we've got some people on the bubble that are hurting.
▶ 1:18:27Sen. Tillis: And instead of talking around all this stuff and coming up with all these artificial construct that have been empirically proven to fail, point to one. In fact, I've got a minute left. If somebody has an example of one of the arbitrary rate caps that work, I will yield my time and explain it to me right now. I got 45 seconds left. I want somebody who has expertise in this field to explain it to me right now.
▶ 1:18:57Sen. Tillis: When did it succeed? I've got a list -- all I've asked is a simple question. Point to the one time in the whole history of the world in credit cards globally where it's worked once.
▶ 1:19:11Sen. Warren: I've got it. And that's when giant corporations --
▶ 1:19:17Sen. Tillis: I reclaim my time, Mr. chairman. I just want one, I'll go for a second round if somebody needs more time. One example of where this precise policy worked. It's going to be a short discussion. As a matter of fact, I've got five seconds left now and there's still no one here that's going to be offering up one.
▶ 1:19:38Sen. Warren: I'm here.
▶ 1:19:39Sen. Tillis: My time has expired, my chair. [laughter]
▶ 1:19:56Chair Scott: Ranking member, ranking member, ranking member, ranking member, ranking member. Let's abide by the rules. Rule books -- senator smith, if you are willing, I will give the ranking member 30 seconds, and I'll give you a 30-second rebuttal and go to you. I'm happy to hear this. Give me an example, I want to hear the example.
▶ 1:20:21Sen. Smith: I was going to defer to the ranking member to answer this question and then I would love to have my five minutes to talk about affordability.
▶ 1:20:30Chair Scott: This is great. A public discourse, a public discussion where there's strong disagreement is actually good for the public to hear. 30 seconds.
▶ 1:20:49Sen. Wear General: I wanted to remind my colleague that back during the covid crisis, the financial institutions, all were given free access to overdraft accounts, it saved them literally billions of dollars, because they could get free access to money when they didn't have money in their accounts.
▶ 1:21:13Sen. Wear General: And the government politely asked them to extend the same courtesy to their own customers, which they refused to do, and they raked in billions more in profits. So it worked for the big boys, it just didn't work for the little guys.
▶ 1:21:33Sen.: So it's never worked before. Thank you, Mr. chair.
▶ 1:21:37Chair Scott: Senator smith, it's your time. Senator smith, still your time.
▶ 1:21:41Sen. Smith: Thank you, Mr. chair and ranking member, and I'm going to shift this conversation to, I want to understand and have a bit of a conversation about how the affordability, so-called affordability agenda is working in small towns and rural places. Dr. morgan, I have a question for you. I come from minnesota. This is a place where food and agriculture are economic drivers in my state. And farmers are telling me that things are tough.
▶ 1:22:07Sen. Smith: That in fact, it is so much harder to afford, to run their businesses than it was just a couple of years ago. Farm bureau says farm bankruptcies were up nearly 50% last year. Minnesota has the most farm bankruptcies of any place in the country in the first quarter of 2026. So what's driving this? I mean, first, fertilizer prices, diesel prices, input costs for farmers are going, the highest they've been in years.
▶ 1:22:36Sen. Smith: And then, of course, the chaotic tariff policy has made it very, very difficult for minnesota producers to find access to markets that were their markets even just a year or so ago. So it's pretty clear to farmers in minnesota that this is a bad situation for them. I'm wondering, could you talk to us a little bit about how this affordability agenda looks like for farmers in this country.
▶ 1:23:04Dr. Morgan: Yes, absolutely. You hit on many of the main points here. Fertilizer prices spiked after the trump tariffs went into effect. In fact, the trump administration had to actually exempt a number of fertilizers from those tariffs. And then they jumped again with the war with iran. We're seeing both fertilizer prices up high, as you mentioned, diesel prices are up. Electricity prices are up as well.
▶ 1:23:31Dr. Morgan: And all of these are squeezing small farmers who are just trying to stay afloat and who often have very thin margins. I think it's really important to point out that for people living in rural communities, that's kind of just the tip of the iceberg, right?
▶ 1:23:45Dr. Morgan: In addition to what they're dealing with in their small businesses, you know, we found that school districts across the country are really struggling with many of the same affordability challenges that individual families are struggling with, including higher electricity prices, higher gas prices, especially in rural areas where busing is a really big component of the school system's budget. And then the cuts to the trump administration and congressional republicans have made on healthcare.
▶ 1:24:12Sen. Smith: I'm really glad you raised this, because this is a huge issue. Think about the economic impact of rural hospitals is just one example on economic vitality, to have small towns, not to mention the importance of having access to healthcare in small towns and rural communities. Talk a bit about that and what those impacts are on rural communities in terms of their ability to afford stuff and get access to the stuff they need.
▶ 1:24:38Dr. Morgan: Absolutely. We're seeing a double wacky here from the impact of -- a double whammy here from the impact of tariffs of services on hospitals offer, as well as the impact of the cuts to medicaid, the failure to extended a.c.a. Tax credit. Rural hospitals are the ones that are being hit the hardest. What we're seeing is they're pulling back on services, so people are having to drive farther and farther to get access to really basic services, like emergency services or maternity health.
▶ 1:25:08Dr. Morgan: It's turning into a really big crisis. It's the kind of situation where people can really feel the affordability crisis every time they try to get a doctor's appointment or seek emergency services.
▶ 1:25:19Sen. Smith: I want to take a minute also to talk about the impact on food. First you've got the question of what is the residual impact on global food prices with the lack of access to fertilizer because of the iran war and what it means for food prices going up potentially as we get into the second half of this year. That will, of course, have an impact on all communities, not just rural. Can you deese that?
▶ 1:25:43Dr. Morgan: Yes, the price of food has gone up pretty much across the board. The century foundation and the ground work collaborative have put out a number of reports tracking the cost of foods. We typically tie them to holidays, where you see the cost of hams going up, hamburger going up around memorial day, halloween candy. So you have this kind of rise in price that we're seeing people, and I know people are putting on their credit cards.
▶ 1:26:12Dr. Morgan: But wee also have this enormous scaling back of snap benefits. So four million people have lost access to snap benefits and are really struggling to find food, which is where we see findings that about one in three people are actually skipping meals in order to try to endure this affordability crisis.
▶ 1:26:29Sen. Smith: If you add on to that the so-called one big beautiful bill included this big cost shift on to counties, many of them red counties who are now having to pay for more of those snap benefits than they did in the past, and that's putting a huge pressure point on county budget and is forcing counties to think about additional cuts to snap, which is also going to make it that much harder to afford your life in small towns and rural communities. Thank you, Mr. chair.
▶ 1:26:54Chair Scott: Yes, ma'am. Senator kennedy.
▶ 1:27:05Sen. Kennedy: Thank you, Mr. chairman. I have to say, I'm a little disappointed. You all seem like fine people. And mister, I can't see, Mr. carbone, you seem to be here to promote cryptocurrency. I don't think that's the problem with our economy.
▶ 1:27:36Sen. Kennedy: Mr. brown, you're here to promote realtors. I love realtors, but that's not going to solve our economic problems. Ms. johnson is here to promote banks. I love banks. Dr.
▶ 1:27:55Sen. Kennedy: Morgan is here to bash trump without telling us that she formerly was part of the biden administration and worked for the cfpb, and your policies caused inflation to go to 89%. -- 9%. I think those have been relevant things to tell us. I guess you thought we weren't going to look up your background.
▶ 1:28:22Sen. Kennedy: Can we agree that the problem of affordability is prices are too high? Duh much duh m. Anybody disagree with that? And prices are too high because of inflation. Does anybody disagree with that? And inflation, despite Dr. morgan's political beliefs, is not just a trump problem. It was a biden problem.
▶ 1:28:53Sen. Kennedy: Was it not? Ok. So here's my question to you. Let's start with you, Ms. johnson. How do you get prices down? That's what we're here for. How do you get prices down?
▶ 1:29:10Ms. Johnson: We think a lot of the things that you all are doing on the committee on the sources --
▶ 1:29:15Sen. Kennedy: Tell me how to get prices down.
▶ 1:29:17Ms. Johnson: You increase supply and cut the red tape.
▶ 1:29:22Sen. Kennedy: You increase supply, ok. Some people want to talk about deflation. If you believe in deflation as we see in the world today, you need to change your meds. China's got deflation. How's it going for them? They've got about a 20% unemployment rate for their young people. The only way out of the inflation is to grow our way out of it.
▶ 1:29:53Sen. Kennedy: Am I wrong? You're going to have to increase our economic growth, not at the top line, but so people feel it. You're going to have to increase wages. And to do that, you disagree with me, Mr. brown, we're going to have to grow the pie, right or wrong?
▶ 1:30:18Mr. Brown: Senator, first of all, I'm here to support homeownership.
▶ 1:30:24Sen. Kennedy: No disrespect, but whatever. I'm sorry if I offended you. How do you think we can get out of these high prices? I mean, you can try to promote deflation, get ready for 10% unemployment, ok? Then Dr. morgan is really going to be bashing us. Tell me how we grow our way out of it.
▶ 1:30:49Sen. Kennedy: I don't see any other way to deal with inflation but to grow people's wages.
▶ 1:30:55Mr. Brown: I think that we increase inventory. We do a lot of the same things that are --
▶ 1:31:03Sen. Kennedy: How are you going to increase inventory? Who holds inventory? Businesses. You have to stimulate the economy and help businesses to grow, aren't you?
▶ 1:31:14Mr. Brown: Well, I come from california, which is ground zero for the last of housing affordability, and it's a little more complicated than that.
▶ 1:31:21Sen. Kennedy: I don't think you want to answer my question. Ms. johnson, aren't we going to have to grow the economy and therefore increase wages in order to help people deal with the inflation? If I'm wrong, tell me if there's a better way, tell me.
▶ 1:31:34Ms. Johnson: I think growth has been a key driver. Consumer spending continues to be strong. It's what's driven it through one of the most tumultuous times we've been through, including bringing historic high inflation. We also do need to address prices. And I think the fed is focused on price stability has to be key.
▶ 1:31:53Sen. Kennedy: So we basically have, we're for price in america. We're basically to grow the economy, you've got to stimulate businesses and try to direct labor to share in the growth, is that right? Ok. Dr. morgan, are you a democratic socialist like your colleagues?
▶ 1:32:18Dr. Morgan: No.
▶ 1:32:19Sen. Kennedy: You're not. I notice your new policy is to create four-day, 32-hour workweek with no loss in pay. Where we going to get the money to do that?
▶ 1:32:29Dr. Morgan: That's not my policy.
▶ 1:32:32Sen. Kennedy: Do you think we ought to have a federal jobs guarantee?
▶ 1:32:36Dr. Morgan: I think a federal jobs guarantee is a good idea, yeah.
▶ 1:32:40Sen. Kennedy: You do, ok. How do you think we're going to pay for that? You believe in the easter bunny, do you?
▶ 1:32:45Dr. Morgan: I think it's incredibly hard to pay for these things giving tax cuts to the ultrarich.
▶ 1:32:50Sen. Kennedy: Jaw, ok. You think all the growth in our economy just goes to the ultrarich?
▶ 1:32:56Dr. Morgan: I think that we just give massive tax cuts to the wealthiest in this country, yeah.
▶ 1:33:01Sen. Kennedy: You are a democratic socialist, aren't you?
▶ 1:33:06Dr. Morgan: I have never used that term to refer to myself.
▶ 1:33:10Sen. Kennedy: No, I know. Do you have a nazi tattoo? >> Mr. chairman.
▶ 1:33:18Chair Scott: Thank you, senator kennedy.
▶ 1:33:22Sen. Cortez Masto: Let me turn this back on track. I can tell you how we're grow the economy. We got culinary members here in the audience. Part of our service industry of nevada, the industry is our tourism trade industry, which by the way, posts nearly a $14 billion, excuse me, trillion dollars in revenue in this country. But because of the bad policies of this administration, we are not growing that economy. In fact, there's a $14 billion trade deficit in 2025. Why?
▶ 1:33:52Sen. Cortez Masto: Because this administration has cut medicaid. They have chaotic tariffs. A war of choice in iran. The barriers put in place of so many that want to travel to the united states, the bad policies, the high cost that leaves less discretionary funds for families to travel. That is part of the problem. So we can eliminate some of the policies of this administration, that will help grow the economy. And I will tell you, I believe that the culinary, one job should be enough in this country. One job should be enough.
▶ 1:34:20Sen. Cortez Masto: And you should be able to afford to put groceries on your table to pay your energy costs, put a roof over your head, and so much more, and afford healthcare in this country. That's what it's about. And so I appreciate all of you being here, because that's a conversation we have. And one of the pieces of the puzzle here is housing and a roof over your head. And I was so pleased to see in a bipartisan way that we passed the road to housing here, the 21st century road to housing.
▶ 1:34:48Sen. Cortez Masto: I thank everybody here that worked on that in a bipartisan, bicameral way. But now we have to fund it. We have to remember there's programs in there that need to be funded. One of them is the home program that I was very pleased to be able to actually put the legislation in to modernize the home program. So Mr. brown, let me ask you this question. Why is the home program so important for building more affordable homes and increasing that supply?
▶ 1:35:17Sen. Cortez Masto: Actually, I don't know if you have your speaker on.
▶ 1:35:19Mr. Brown: We do support the home program. Which section is that, senator?
▶ 1:35:24Sen. Cortez Masto: The road to 21th century housing. That actually funds, financing federal dollars that come in to states for the home program to help finance supply. If you're not familiar with it, happy to have one of the other panelists --
▶ 1:35:38Mr. Brown: No, I think it's very important. I think that overall, this bill is extremely important to increasing affordability in the housing market, because you're cutting red tape. You are cutting regulatory burdens. And you're increasing inventory. I think that's the way that we're going to be able to tackle the affordability crisis. Think bill goes a long way. It's a great start. More work can be done.
▶ 1:36:08Mr. Brown: But there are really good things in this bill that are really going to help the affordability, housing affordability crisis in america.
▶ 1:36:16Sen. Cortez Masto: That's the key, right? It's one thing to pass it. Now we have to authorize the appropriations for these programs. The home program is a grant program through h.u.d. That brings essential dollars, federal dollars into our communities to build housing.
▶ 1:36:29Mr. Brown: Affordable housing, yes. It's extremely important.
▶ 1:36:33Sen. Cortez Masto: Thank you. I appreciate that. Let me talk to Dr. morgan. I have been concerned with what I'm watching happening with the cfpb. As the former attorney general there, I clocked wesly, and now this administration has eliminated the cfpb. And I am concerned now with what that means for consumers, in general americans.
▶ 1:37:06Sen. Cortez Masto: The president's proposal to cut funding for affordable housing programs like homes and gut the cfpb bureau doesn't help families who have seen rents rise 50% since 2020. How does the president's decision to gut the consumer financial protection bureau enable landlords to still charge junk fees to renters? Is that still happening in this country?
▶ 1:37:32Dr. Morgan: It's a really good question. The gutting of the cfpb has taken the cops off the beat. So there's really no one minding the store for consumers and making sure that financial institutions are following the law. It gives a green light to predatory companies to break the law as they see fit.
▶ 1:37:53Dr. Morgan: And you know, when it comes to renters in particular, the cfpb had really been watching this proliferation of products that were being put into the market in order to bridge the gap between rents and what people could actually afford. Rental credit cards, different kinds of innovative payment processing platforms, security deposit replacement products that turned out to be a loan or another kind of shady product.
▶ 1:38:21Dr. Morgan: So not having the cfpb in place to actually crack down on those practices is really important. The other role that the cfpb plays is on the research and market side. They were the organization that was keeping an eye on what was happening with family finances, keeping an eye on household financial stability, raising the alarm when it became a larger problem that threatened the economy overall. They're not doing that either.
▶ 1:38:48Dr. Morgan: So there are a lot of threats here for renters and homeowners alike.
▶ 1:38:52Sen. Cortez Masto: Thank you. Thank you, Mr. chairman.
▶ 1:38:55Chair Scott: On behalf of the chairman, thank you. Senator ricketts?
▶ 1:38:59Sen. Ricketts: I can thank the chair and ranking member for holding the hearing here today, talk about affordability. Now, I'm going to start with a topic I bring up in an environment of public works. But since we're talking about affordability, I'm not going to miss the opportunity here. That's about biofuels. I know senator rounds knows all about this. Biofuels are a win, win, win. They save consumers money at the pump. It actually helps clean up the environment. It's great for our farmers and ranchers.
▶ 1:39:28Sen. Ricketts: Last weekend, I filled up at my local hy-vee and saved 55 cents a gallon on e-10 compared to the regular 87 octane gasoline. If we pass e15, that would allow for even more savings for americans, but more money back in americans' pockets. I was glad to see the house pass my congressman bill, so I want to work with senator fischer on getting that passed on the senate side, so I'll put my plug in for that.
▶ 1:39:56Sen. Ricketts: One of the other things we're talking about is the grow the 21st century housing bill we passed and why that was so important. One of the things that we saw was that homeownership 10 years ago, the first-time home buyer was 31 years old. Today it's 40. Addressing this, it's not a new problem. When I was governor of nebraska, we had the same issue with regard to enough housing stock. I think Mr. brown, that's one of the things you referenced. We got to have more housing. You have more houses, you bring the cost down.
▶ 1:40:26Sen. Ricketts: That's one of the things we can do. One of the things we did when I was governor was create the housing fund to be able to create this fund that would work with communities and developers to create more housing stock. And that is the goal of what we're doing here with the 21st century housing bill, to try to find more ways to create more housing stock. So working with chairman scott and the rest of the banking colleagues here, we're working on making housing more affordable for nebraskans. The house passed its bill. We voted on ours.
▶ 1:40:56Sen. Ricketts: I put a number of common-sense, 21st bills into this so we can build more homes. It includes priorities to be able to help break ground quicker. One estimate, for example, accounted for 25% of the cost for single family homes for an apartment building that's actually 40%. Duplicate regulations that add to the cost of homes, but also extend out project lines.
▶ 1:41:24Sen. Ricketts: The longer it takes to build a house, the less available as well. In nebraska, housing projects often draw both h.u.d. And usda money for a portion of their financing, and those processes, both those agencies have their own processes for reviewing an inspection, and they can also be very overlapping and create confusion, bureaucracy, so one of the things I put in the 21st century act was the act which
▶ 1:41:54Sen. Ricketts: Will require h.u.d. And usda to work together so they can, instead of doing duplicative processes, trying to put them in parallel to make that more efficient. The bill also directs the agencies to work together on cutting other red tape. Allowing those delays will get the money out fast, which means the money will go to building homes faster. So that's an important part of what we're trying to do here. Another issue is breaking ground on a project for reviews on land that's already gone past review.
▶ 1:42:24Sen. Ricketts: For example, sometimes the national environmental policy act, or nepa, reviews power, water lines and development areas that have already had them. These are known as infill sites. The rural housing regulatory relief act that I introduced which streamlines nepa reviews are located on infill sites. Again, eliminating this unnecessary regulation is common sense to speed up housing construction. Mr. brown, I've talked about a couple of these.
▶ 1:42:55Sen. Ricketts: What kind of impacts do these kind of reforms have on project costs, timelines, and completion?
▶ 1:43:01Mr. Brown: You just hit the top three zoning regulatory and environmental. Those are the things that really delay projects and add to the costs. Your estimates are spot on, adding about 25% to 26% of regulatory costs before you even break ground, which is really a huge barrier for a developer or builder in the marketplace. 40% for multifamily before they even break ground.
▶ 1:43:29Mr. Brown: So this bill does a tremendous job at cutting some of the red tape, and I think it's going to be a great step in terms of producing more housing inventory, multifamily and single family dwellings in this country.
▶ 1:43:44Sen. Ricketts: By cutting the red tape, we'll be able to reduce the timeline, is that accurate?
▶ 1:43:50Mr. Brown: Yes, reduce timelines, streamline the process, which means it's going to be less expensive to build.
▶ 1:43:56Sen. Ricketts: Great. These are the kind of common sense reforms we want to put in the package to help make sure this got done, which is the point. Thank you very much, Mr. brown, and to all of our witnesses. Thank you, chair.
▶ 1:44:06Chair Scott: Thank you, sir. Senator warnock?
▶ 1:44:12Sen. Warnock: Thank you very much. Your introduction was prescient. You'll see why, brother chair. According to a recent fox news poll, more than half of all voters feel that president trump's economy only helps rich people.
▶ 1:44:29Sen. Warnock: With an additional 15% saying his economy helps "no one." that same fox news poll found that three out of five voters feel pessimistic about the economy. Does not matter much what those of us on this panel feel, it's what the american people feel. Consumer sentiment is near record lows. Ordinary americans know donald trump's economy isn't working for them. Dr.
▶ 1:44:59Sen. Warnock: Morgan, you're an expert on the economy. I don't know your faith tradition or if you share a particular faith tradition at all. But I'm a matthew 25 christian. Meaning I like to center my work on the least among us, the poor. The most marginalized. Isaiah, who I've been reading a lot lately, says who are you to crush my people, to grind the faces of the poor?
▶ 1:45:32Sen. Warnock: I want tooting I want too to dig into the verso assess the economy. You gave me something to drink when I was thirsty. Dr. morgan, how have the president's policies been for hungry americans?
▶ 1:45:50Dr. Morgan: Senator warnock, the president's policies have pushed more and more americans into hunger. We've seen actually four million people lose their snap benefits under this administration. It's about 700,000 of them were children. And the century foundation's only polling shows one in three americans have skipped meals in order to deal with their cost of living crisis.
▶ 1:46:16Sen. Warnock: You said four million americans? And you said 700,000 of the americans kicked off of snap are children?
▶ 1:46:25Dr. Morgan: That's right.
▶ 1:46:26Sen. Warnock: Because I met with the speaker and others, and they're saying that these are able-bodied men who are kicked off of snap. You're saying these cuts are leaving children food insecure?
▶ 1:46:42Dr. Morgan: That's right.
▶ 1:46:43Sen. Warnock: Let's try another one. I needed clothes and you clothed me. How have the president's policies helped unhoused americans?
▶ 1:46:54Dr. Morgan: The tax cuts alone had a massive effect on low-income families. Low-income families actually lost money under h.r. 1 to the tune of about $100 million.
▶ 1:47:10Sen. Warnock: The one big beautiful bill.
▶ 1:47:11Dr. Morgan: That's right. But the trump administration has taken other actions that target poor families. The trump administration has attempted to impose work requirements on rental assistance. They propose cuts and changes to programs that supports the homeless. And then rising utility costs are also hurting the poorest families as well.
▶ 1:47:30Sen. Warnock: Matthew 25 says when I was sick and you looked after me. What about the president's healthcare policies, especially when it comes to healthcare affordability?
▶ 1:47:40Dr. Morgan: This is an acute problem for families right anyway. We've seen cuts to medicaid that have taken insurance away from families. We've seen the failure to extend the a.c.a. Premium tax credits that has jacked up the cost of health insurance premiums for many american families. We're also seeing an increase in cost on employer-sponsored plans. People are really faced with a choice right now of being uninsured or choosing kind of like a skimpier health insurance plan in order to get coverage. And at the same time --
▶ 1:48:11Sen. Warnock: The trump administration and washington republicans cut $1 trillion out of medicaid. They call it waste, fraud and abuse. Is it fair to say they cut more than waste, fraud and abuse?
▶ 1:48:20Dr. Morgan: That is correct. They cut care for american families.
▶ 1:48:24Sen. Warnock: When I was a stranger, you invited me. How is the trump economy been for law-abiding immigrants? And dreamers living in the shadows?
▶ 1:48:35Dr. Morgan: We've seen a kind of xenophobic attack on our immigrant neighbors. We're seeing families who are afraid because of the actions of I.c.e. To go to work and to send their families to school. It's incredibly crushing both for those families and for their communities and those of us who live among people. And then we've also seen these attacks to try to take away benefits and programs from law-abiding immigrants. It's hugely concerning.
▶ 1:49:04Sen. Warnock: Who is served by this economy? That's a long range of people who seem to be suffering. Who's served by the trump economy?
▶ 1:49:11Dr. Morgan: It serves the rich, right? It serves trump himself. It serves his billionaire colleagues. And it serves the banks who are represented here at this hearing who have gotten the trump administration to roll back protections for working families in order to maintain their profits.
▶ 1:49:30Sen. Warnock: I'm a few seconds over, so I'm going to bring this to closure, brother chair. But donald trump has been president for 18 months. And while he and his advisors love to blame joe biden, joe biden, joe biden for rising costs, americans elected him to lower costs. He's been at it for 18 months. He's raised costs for everyone, shredded the safety net meant to catch people during tough times. This trump economy is not just bad. For me it's a moral abomination.
▶ 1:50:01Sen. Warnock: This is bigger than politics. It's about humanity. Thank you so much for your testimony.
▶ 1:50:06Chair Scott: Senator banks?
▶ 1:50:08Sen. Banks: Thank you, Mr. chairman. Mr. brown, as you know, the road to housing act passed the senate yesterday. We expect it to pass the house today. Hopefully be signed by the president very soon. There are many important parts of the bill. I think the bill is significant. There are some who say it's not, but I think it's a significant bill that would go a long way to help solve the housing crisis and help your members do what they do to serve families.
▶ 1:50:38Sen. Banks: One part of the bill that I authored along with senator warner on the other side is called the reside act. That's fairly common sense, but it would allow communities to compete for grants and take empty warehouses, old factories, dead strip malls, shuttered hotels, and then turn those structures into housing.
▶ 1:51:00Sen. Banks: I had a lot of mayors across indiana, republican and democrat mayors of small towns, big cities, all agree that that would be a new tool for them that they could use to solve the housing shortage in their communities. But I wonder if you agree that it would be helpful. What are some other parts of the road to housing act that you think are significant that will go a long ways to helping us address this issue?
▶ 1:51:28Mr. Brown: I do agree. I think that's an important revision. There's lots of underutilized commercial structures throughout america that are just sitting there vacant. In fact, in my own business, we sold a commercial warehouse in an opportunity zone to a buyer who then developed it into residential units.
▶ 1:51:49Mr. Brown: And I think that that is a great example of how you can take an underutilized structure that's not producing anything, housing or income or anything, convert it to actual living units where people can live. I think that there's a lot of provisions here, especially the streamlining of the process to reduce costs.
▶ 1:52:14Mr. Brown: Helping out with zoning, helping out with environmental, reducing the environmental layers of environmental in terms of developing housing, I think that's very important. This just hits so many areas that's going to reduce time and reduce costs and streamline processes. But back to your original comments, I think that's a very important part, especially as it pertains to opportunity zones.
▶ 1:52:39Sen. Banks: Maybe the bill is not a sell per bullet, but it will go a long way, you believe that?
▶ 1:52:46Mr. Brown: I believe so.
▶ 1:52:47Sen. Banks: Is there a sill per bullet out there?
▶ 1:52:51Mr. Brown: We haven't come up with a silver bullet yet, but I hope that congress looks at the more homes on the market act. I think I made a comment when I first started the hearing that I really believe that if we can double the capital gains, it's going to add instant inventory to the marketplace. In doing so, it's going to reduce some of the housing crisis.
▶ 1:53:18Sen. Banks: Ms. johnson, can you talk about why mortgages are costing more and what are the rules and regulations and fees that are being added that's making mortgages so darn more expensive than what they used to be?
▶ 1:53:34Ms. Johnson: Thank you for the question. The last 10 to 15 years in particular, it's really been a combination of heightened capital requirements, regulatory scrutiny, banks, nonbanks all have to go through. There's litigation risk. There's operational burdens. There's been a focus on, one, the supply issue, which we think is first and foremost. But there's also been an intense focus from the administration of increasing bank participation.
▶ 1:54:00Ms. Johnson: There is a real need to increase bank participation in this market, so that you have more competitive options for bo orers, we're excited about the executive order. We've been very pleased there's a recalibration in the proposal on mortgage. I think that will go a long way to reduce costs.
▶ 1:54:17Sen. Banks: Any big ideas we're missing here?
▶ 1:54:19Ms. Johnson: I think your focus on supply and using the carrot stick approach is the right one.
▶ 1:54:24Sen. Banks: Mr. carbone, in plain terms, can you explain how dollar backed stablecoins lower everyday costs for people who are underbanked or paying too much in transaction and remittance fees?
▶ 1:54:37Mr. Carbone: Absolutely. Thank you for the question. Right now the average remittance fee in america takes 6.5%. For every $100 in america sending overeast, resilient is only getting $93, and it takes three to five days to get there. With the dollar backed stablecoin, they can send it instantly and almost for free. As a huge example, we're already seeing through the genius act pass, cheaper, more competitive payment options for americans.
▶ 1:55:04Mr. Carbone: We're starting to see merchants and gas stations invent views to use cash and credit with dollar-backed stablecoins. Regal cinema is giving 10% off all tickets if you pay in dollar backed stablecoins instead of using credit or cash. The genius act is working. We're seeing more options for payments and remittances.
▶ 1:55:27Sen. Banks: Good to know. Thank you, I yield back.
▶ 1:55:29Chair Scott: Thank you, sir.
▶ 1:55:34Sen. Blunt Rochester: Thank you to the witnesses for being here today. I want to start off by expressing my deep gratitude to the chairman and the ranking member for your leadership and all of my colleagues on the passage of the bipartisan 21st century road to housing bill. This landmark legislation is something that I think americans have been waiting for for over three decades. So I am just grateful to the members here who worked on it.
▶ 1:56:04Sen. Blunt Rochester: I think we took a great step forward in addressing our housing supply crisis. Many of the bills that I secured in the package will empower local communities to tackle housing affordability by encouraging zoning reform, reducing red tape, and unlocking innovation. I'm looking very forward to seeing that become law and also looking forward to road 2.0, just putting it out there. Manifesting that.
▶ 1:56:32Sen. Blunt Rochester: And finally, I want to extend appreciation as well to the house members for passing, because we're going to speak that they're passing it, and we will see it signed into law, and today, as we talk about the housing affordability crisis, we also think about the broader crisis of affordability, and I know the chairman talked about the one big beautiful bill putting forward $250 a month for
▶ 1:57:03Sen. Blunt Rochester: Many american families. But all I could think of were the calls and people I see in my own state, folks who are paying $50 to $80 to fill up their gas tank. Constituents who have written in and said I, because of the lack of a.c.a. Tax credits, I now have chosen to just give up insurance, which means that health insurance could roll into medical debt, and it has an impact on all of our costs.
▶ 1:57:34Sen. Blunt Rochester: I think about folks who are food insecure right now. And the cost of food, whether it's at the supermarket or if you can even go to a restaurant, and I don't think that that covers what people are feeling. For me, yesterday I was able to, with my congressional delegation, senator coons and congresswoman mcbride, we held a roundtable for veterans in our state.
▶ 1:58:02Sen. Blunt Rochester: It was a veterans roundtable, and at the roundtable we had representatives from different veterans organizations. And then we held a resource fair in addition to the roundtable. And we kept coming back to this issue of cost and them not being able afford to live. These are our neighbors, people who have serve this had country and are serving this country.
▶ 1:58:31Sen. Blunt Rochester: And between the issues of homelessness, the issues of suicide, the issues of, again, just being able to make ends meet, it really became clear that they are feeling the brunt in a many of us don't even feel. Dr.
▶ 1:58:49Sen. Blunt Rochester: Morgan, I wanted to ask you about the cfpb, which has historically played an important role in forcing the military lending act and protecting service members from predatory financial practices. Has the cfpb reduced its enforcement of the m.l.a.?
▶ 1:59:10Dr. Morgan: The cfpb has reduced I said enforcement of the m.l.a., yes.
▶ 1:59:16Sen. Blunt Rochester: Has that hurt affordable for family americans and can you talk about how?
▶ 1:59:25Dr. Morgan: Yes, absolutely. There's research that shows the tax cuts are wiped out by the cost of the war with iran. So when people are coming to so when people are coming to yu and saying this doesn't add up, it doesn't add up. But in terms of military members, the cf bb has stepped in over the years many times to protect military service members from predatory practices by lenders, by allotment processors, student loan servicers and others.
▶ 1:59:51Dr. Morgan: And under the trump administration, some of the massive dialing back of enforcement and supervision to the point of nonexistence, and people don't even have a place to file a complaint anymore. And this really lands hard on military service members. In fact, the c pb has actually walked away from lawsuits and settlements that would have put $80 million back into the pockets of military service members who were subject to illegal practices.
▶ 2:00:17Sen. Blunt Rochester: It's my understanding since 2011, service members from all 50 states and every military base have filed more than 400,000 complaints to the cfpb, and that there was a complaint database.
▶ 2:00:34Sen. Blunt Rochester: Can you tell us, why was the office of service member affairs at cfpb created in the first place, and what are the consequences of weakening the protections as well as lessening the staff and shuddering offices?
▶ 2:00:48Dr. Morgan: It's a really good question.
▶ 2:00:49Chair Scott: You only have about 15 seconds to answer this question.
▶ 2:00:52Dr. Morgan: Ok.
▶ 2:00:55Sen. Blunt Rochester: Can I have the time louisiana had?
▶ 2:00:58Chair Scott: No, ma'am.
▶ 2:00:59Dr. Morgan: Financial readiness is a critical component of the military readiness. When people are distracted by dealing with predatory lenders at home, or when their security clearances are held up from a debt collection they shouldn't owe, that affects our ability to fight wars and keep our country safe. This is a really critical component of the overall picture on defense.
▶ 2:01:18Sen. Blunt Rochester: Thank you. These are the people who protect us. They deserve to have our protection as well. Thank you, and I yield back.
▶ 2:01:26Chair Scott: Senator moreno.
▶ 2:01:28Sen. Moreno: Let me start my portion by complimenting you, Mr. chairman, and actually our ranking member. I think what we got here was monumental. It obviously also is an indictment on the person who used to occupy your chair. He was unable to get anything done. To both of you, kudos, to your predecessor, shame on you. In terms of where we've been hearing a lot about today is the word hoax. I learned english ads a second language when I was about 6, 7, 8 years old.
▶ 2:01:58Sen. Moreno: Some would say I still haven't learned it completely. The word hoax can sometimes be made that something is not real. But it actually means deception. That there's a deception going on. Miss johnson, what was the average inflation, cumulative inflation during the wipedden years, do you know?
▶ 2:02:16Ms. Johnson: I know it reached the peak of 9.1%.
▶ 2:02:20Sen. Moreno: Under trump it's cumulative 5%. You represent bankers. Is five less than 21.5?
▶ 2:02:29Ms. Johnson: Yes, it is.
▶ 2:02:31Sen. Moreno: When somebody creates 21.5% of cumulative inflation, and then the next person creates 5% cumulative inflation, and the people who did the first part blame the second one for price increase, it's a hoax. So we got that out of the way. Now, Mrs. johnson, I want to talk about some of the things that have been brought up about banks.
▶ 2:02:57Sen. Moreno: Why do you post withdrawals at most of the financial institutions? Most banks, for example, in ohio most banks, for example, in oh ohio, that receive deposits, those deposits don't credit the person's account until after withdrawals, and a lot of that results in overdraft fees. That's something that you guys can either do voluntarily or you're going to make us pass a law to do that.
▶ 2:03:24Sen. Moreno: Because it's crushing working americans, and it's fundamentally unfair.
▶ 2:03:29Ms. Johnson: Thank you for the question. Look, there's a lot of technology on the back end, and a lot --
▶ 2:03:37Sen. Moreno: Just do it the right way. You shouldn't have people whose paychecks are coming in and you don't take that into account. Just bad practice. Just don't do bad things, and make us have to do that. You were talking about also these zero percent interest offers. Nothing has crushed working americans more than zero percent interest offers. Now you have compounding interest that's due as a result of these offers. These people get absolutely destroyed and crushed. Don't do things like that.
▶ 2:04:08Sen. Moreno: And certainly don't take a victory lap for offering those types of things. All you do is give an opening to the people who think that bad behavior is unnecessary.
▶ 2:04:18Ms. Johnson: Could I give a quick response? A couple of things. One, a.p. R.'s are comprised of a number of different things.
▶ 2:04:28Sen. Moreno: I get all that. I'm talking about compounding interest. The fact that you send people magic checks that make them think there's zero percent interest. They miss the payment by one day, and you pay retroactively for every single month. I'm just telling you, look, if you want to have, if you want to have good cooperation from people who care about working americans, which is republicans and democrats, don't do things like that. That's just my advice. You can take it or not take it. In terms of you, Mr.
▶ 2:04:57Sen. Moreno: Brown, what is the position of the national association of realtors when it comes to the institutional investor?
▶ 2:05:05Mr. Brown: Institutional investor ban?
▶ 2:05:09Sen. Moreno: Yes. Prohibiting large firms buying homes competing with ordinary americans. Is that good or bad?
▶ 2:05:17Mr. Brown: I think institutional investors are a problem in some communities. They're certainly not the cause.
▶ 2:05:22Sen. Moreno: I didn't say it was a cause. Do you support not having institutional investors compete with individuals?
▶ 2:05:29Mr. Brown: Yes.
▶ 2:05:30Sen. Moreno: Ok, perfect. I'll turn it over to you, Dr. morgan. What does a dozen eggs cost today?
▶ 2:05:37Dr. Morgan: At the last time I bought them, it cost like $7.
▶ 2:05:41Sen. Moreno: Oh, you need to move. The average price of a dozen eggs is $2.19. We are going to send the police after the grocery store where you do business. Do you know what it was under biden? Obviously you don't, because you didn't know now. It was $2.65. Is that less?
▶ 2:06:01Dr. Morgan: It is.
▶ 2:06:04Sen. Moreno: Ok, perfect. Prices have gone down. What's the price of a barrel of oil today?
▶ 2:06:10Dr. Morgan: I don't know off the top of my head. It's $100 a barrel.
▶ 2:06:14Sen. Moreno: It's $73. What was it during biden? It was 82. The price has come down. What else the -- what is the most commonly used fertilizer? Nitrogen. What else the cost per ton under biden for nitrogen, fertilizer?
▶ 2:06:32Dr. Morgan: I don't know.
▶ 2:06:34Sen. Moreno: It's a thousand dollars a ton. It's half. Let me just, let me just, you're good, you are not the contestant on the next price is right. You would not do well. In terms of electric vehicles, do you think it's good public policy to offer $7,500 to multimillionaires to lease foreign luxury vehicles?
▶ 2:06:53Dr. Morgan: I don't believe that's happening.
▶ 2:06:55Sen. Moreno: You're exactly right. It's not happening, because republicans got rid of that in the working families tax cuts. It was absolutely happening under the biden years. In fact, 250,000 people got $7,500 to lease luxury electric vehicles. Was that a good decision or bad decision?
▶ 2:07:13Dr. Morgan: Senator moreno, I think these questions are very important, but I have to say, donald trump is the president right now and prices are extraordinarily high.
▶ 2:07:22Sen. Moreno: Not eggs, not oil, not fertilizer. And now we have prescription drugs. Prescription drug prices on trumprx.com are down for commonly use drugs. My point is, when people create a forest fire and then blame the other person for said forest fire, I would call that a hoax. Thank you, Mr. chairman.
▶ 2:07:48Chair Scott: Senator, you now have six minutes. >> thank you so much. To our ranking member who just had a birthday yesterday, you know, this was the saddest exchange that I've seen, and with all due respect, I think it really does underscore the problem that we have in our country right now. Too often in these bodies, I think the people who sit here don't shop light. The people that represent, they clearly are so out of touch.
▶ 2:08:16Chair Scott: With all due respect to my colleague, he just said the price of eggs is $2 and something. I don't know what in the world grocery store, I don't know that people even grocery shop for themselves, because I'm in the grocery store every weekend, and I'm paying $7 for a dozen eggs. And that is the issue that we face right now. So I appreciate the opportunity to talk about affordability. The reality in this administration, we are in an economic disaster in our country.
▶ 2:08:46Chair Scott: The people in america are tired of being told not to believe their lying eyes. Those who shop and buy gas and pay for utilities, we are living a whole different existence apparently than the people who are supposed to represent us. These are the facts. 4.#%, this was may's inflation rate. The prices have risen steadily under president trump's administration. They are the highest that they have been in three years.
▶ 2:09:13Chair Scott: Almost $4, this is the average national price for a gallon of gas. Gas is the most expensive it has been literally in three years. $2,500, this is the estimated cost every american family is paying because of president trump ace tariffs in 2026. This is the wealth controlled. The american people do remember a year ago when this president did promise to end inflation on day one.
▶ 2:09:43Chair Scott: Imagine how ridiculous that was. He promised energy and electricity prices would be slashed. This is not hyperbole. Go pull back the tape and we can see what he said. He insisted that housing prices would decrease. He said that he would make america affordable again, and he said the cost of groceries would go down on day one. But instead, it's harder to afford a down payment, purchase health insurance, take your family on vacation, put food on the table, or buy back the school supplies.
▶ 2:10:10Chair Scott: This is the reality for the average american. Americans should know that this isn't coincidental. They understand it's because of the chaos, cruelty and corruption they have seen with their own eyes. The treasury tariffs continue to make groceries and other goods more expensive for business and for families.
▶ 2:10:28Chair Scott: And last summer, despite rising prices, republicans rubber stamped trump's cruel and callous bill that ripped healthcare and food assistance away from millions of americans in this failed war of choice in iran, it's sown more economic chaos, it has raised gas and fertilizer prices. If you look beyond the chaos and cruelty, you also can see in plain sight the blatant corruption.
▶ 2:10:56Chair Scott: The trump family has made over $1.4 billion from crypto schemes, often leaving regular investors with losses. A trump family business is on the fast track now to become a bank, saddling everyday americans and community banks are more risk. And fraudsters and scammers continue receiving presidential pardons because they are friends of this president. The loot I have to tell you, the smash and grab that happened with this administration means the loot is literally hanging out of their pockets.
▶ 2:11:26Chair Scott: And they're betting that americans won't pay attention. But while this administration continues to fail, we're working to make bipartisan progress. I'm so proud to be on this banking committee. I want to thank our chair and ranking member for the tremendous work that they have done on the road to housing act, which the senate passed last night. What a miracle it was to see it pass by such a large margin.
▶ 2:11:49Chair Scott: The road to housing act is proof that congress really can rise to the occasion and do what's right, and I am particularly proud of the provisions that I championed, which will make it easier for banks to invest in affordable housing and create a federal grant program for people to make essential repairs to their homes so they're not forced to sell or to foreclose.
▶ 2:12:08Chair Scott: While families are priced out of homeownership and the dream of a stable house is slipping away, congress took a big step forward to expand the housing supply, reduce red tape, and make homeownership more affordable. This is worth celebrating. Our kids deserve it. They deserve it. My 21-year-old daughter, who's so different than her grandparents, my parents married at 21 and 22. Within five years of their marriage, they could buy a modest home. The average age of a first-time home buyer is 40 years old.
▶ 2:12:39Chair Scott: So common should continue to step up. While this administration's chaos, cruelty and corruption is occurring at every juncture I will never hesitate along with my colleagues who are willing to roll up our sleeves work in a bipartisan fashion to address our shared goals. Thank you.
▶ 2:13:01Chair Scott: Senator, you done?
▶ 2:13:05Sen. Alsobrooks: Yes, you gave me an extra minute, but thank you so much.
▶ 2:13:08Chair Scott: Let me just say, for senators who wish to submit questions for the hearing record, those questions are due one week from today, tuesday, june 30. Witnesses have 45 days from that day with answers. I will say this has been, frankly, I think a constructive hearing, not always positive, but always constructive.
▶ 2:13:30Chair Scott: However, as it relates to the ranking member and I looked up the price of eggs so we would be on the same page, literally the price of eggs can go from about $1.79 at wegmans, in my neck of the woods, which did I have to look up, because in south carolina you can get eggs for $3 a dozen. Elizabeth, ranking member, did find some for as high as $9 for eggs.
▶ 2:13:57Chair Scott: I will simply say that the ability to compare prices for the trump administrationed to biden administration, I'll take that comparison, even now. Or even in a week on any topic, but the fact of the matter is senator warnock and I had a conversation about having a hearing at the banking committee, which I actually look forward to.
▶ 2:14:21Chair Scott: You read the entire chapter, it does give you some responsibility for those who have talent, but that talent is tier five, also goes into bridesmaids and lots of other conversations, but it does get to the place where we are asking ourselves really important questions about how we treat each other. Really important. I'm not sure that we always remember that when we're having a conversation with others. But I think it's incredibly important for us to recognize the importance of loving your enemy and praying for those who persecute you, at the same time taking a look at those who are struggling. There are multiple ways to try to address the issue.
▶ 2:14:53Chair Scott: I think both sides try to do so. Sometimes I think as a guy who grew up in poverty, because after taking a serious look at the consequences of good policy and bad policy, not good intentions and bad intentions, I decided the best way for me to impact communities that were struggling is by being a republican. However, on this committee, we should continue to have the type of engagement that allows the public to see disagreement without being disagreeable, and ultimately I think we achieved that goal today.
▶ 2:15:22Chair Scott: However, I do look forward to the opportunity to have a discussion about matthew 25 sometime in the near future. Hearing adjourned.