From:  The Press and Guide

SOUTHGATE — During summer recess from one of the most contentious Congresses he has seen, U.S. Rep. John Dingell (D-Dearborn) recently paid a visit to The Press & Guide to discuss several issues on the agendas of federal, state and local governmental units.

Below are excerpts from that conversation.

P&G: What do you think of the new district? Are you happy with it?

Dingell: Oh yeah, like a clam at high tide. Getting Downriver back? That’s like dying and going to heaven.

P&G: How much money have you raised thus far for your re-election bid?

Dingell: I haven’t checked lately. We’ve got about $130,000 or something like that. We’ll have to start doing some more intensive fundraising.

P&G: Standard & Poor’s downgrade of the country’s credit rating was attributed to political factors more so than financial standing. What do you make of this?

Dingell: Political gridlock. Bad behavior. The fact that we appear to, in their eyes, be losing the ability to properly govern ourselves and manage our affairs. That’s a serious matter. It’s sort of like all of a sudden becoming a third-world republic. The good thing about it is that we found the markets didn’t accept those judgments.

It does mean that if we don’t settle down and get down to serious business in Washington, that the markets are liable to accept that kind of thing and then the country is in serious difficulty because it raises in interest rate, it will create inflation, it will affect our trading relations with our partners, it will cost us jobs, it will see to it that our government securities have to pay more interest and raise interest on national debts. The consequences are quite serious.

P&G: Did you think the downgrade was justified?

Dingell: Well, yes and no. The folks that did the downgrading are folks who have a rather bad record in terms of their evaluation and rating of different kinds of investments and investment documents. And, if I don’t misremember, they missed a major economic failure in connection with one of their ratings not too long back. And there have been some questions about their behavior, including some that relate to whether there ought to be more regulations on them because of their a, lack of confidence and b, because of their, quite frankly, sometimes questionable behavior.

P&G: Where do you stand on further regulation of the ratings agencies?

Dingell: Well, we have been moving toward deregulation of the financial markets, and I directly attribute that activity —particularly with the repeal of Glass-Steagall (Depression-era banking regulatory reforms) and things like that — to the collapse of the market that occurred recently and the recession. Most specifically, the repeal of Glass-Steagall allowed the banks almost anything they want. When we repealed Glass-Steagall (1999), I warned that within 10 years we would have this kind of event occur. I was wrong by a year. I was a year early.

They (the ratings agencies) had a part in those events, because they were not rating things well and there were things that appeared to be serious conflicts of interest or opportunities for conflicts of interest because of the way they related to the people that they rated. I think we have to get back to insisting that there is a startling improvement in the ethical behavior of the whole financial structure in New York. I’m talking about the big investment banks. I’m talking about the rating agencies. I’m talking about the ungodly salary they’re getting, the fact that their evading taxes.

And the fact that if you look, we’ve had a rich display of scandals involving insider trading, misbehaving by people, hurting investors and the little people of the market and causing significant in lack of trust in the marketplace.

When I was in charge of the committee that was in charge of regulation of security… I used to make speeches to the securities industry and I’d always get a standing round of applause. I’d say, “You fellas know what we should be doing is recognizing that essentially you hold a public trust. And if people have confidence, the markets will work well. And that the markets do not run on money, they run on public trust and public confidence. And if the public has confidence, you and everybody else in the market will do well and make money.”

But when that’s lost you have trouble. And you saw that when they caused, quite frankly, the market collapse.

I was told by a very, very wise, smart guy who’s been in the business for years that we were about four hours from seeing the entire bank structure of the United States collapse. And, if you saw what happened in the market when they first rejected TARP (Troubled Asset Relief Program), you saw just how serious his comments should be taken.”

P&G: Let’s talk education. Local school districts are in the process of evaluating where they stand financially and otherwise.

Dingell: (Cuts in) They’re all in trouble. And they’re in trouble on everything including the feds and the fact that No Child Left Behind is regulating them too sternly and too strictly and the fact that they are now running, not educational institutions, but quite frankly child testing institutions and that’s the wrong thing.

When I meet with superintendents, and administrators and school boards, I get a constant flow of complaints about that.

And Obama, one of the things he intends to do is, at some point, address some of those concerns. But he is sort of handicapped because of the difficulty he confronts in dealing with the budget matters and the fact that we have an economic downturn. And, of course, the worst thing we have going on is, instead of addressing questions of jobs and the economy, we’re having this huge battle over other things that really are not the most vital, core issues that this country confronts.

If you look down there, social security is important. The budget is important. But the fight over budget is whether Obama is going to get his way or Republicans will get their way. The difference here is Obama wants to make his budget be one which will first of all budget, but a little further down the road. But, in which his budget will also spend money on education, environment, and important public investments like roads and sewers, cleaning up our waters and the Great Lakes and things like that.

With both TARP and ARRA, we have been moving in that direction, but not enough of it.

I’m sorry. I’ve gotten away from your question.

P&G: For the education industry in the area, but also in the state overall, is there any light at the end of the tunnel in dealing with shrinking revenues?

Dingell: The feds don’t do that. The feds provide assistance in meeting important national goals; seeing to it that every kid has an opportunity to a decent education, seeing to it that our educational system provides us the engineers, the technicians and others that we have to have to be competitive in the world.

The actual running of the schools is the responsibility of the state. Well, if you look, they’ve been cutting, cutting, cutting, cutting. And they cut the locals, and they cut the universities, which are tremendous education and technology resource to this nation and to Michigan. The end result of that is that we’re chasing jobs across the borders, because those (universities) will not serve to be spin-offs for new jobs and new opportunities for our people. Now, having said that, we’re hoping that some of the tax moves they’re making up there (in Lansing) are going to make for a responsible situation for us. In other words, I’m hoping that the personal property tax repeal is going to have a replacement for its income because that’s going to kill communities. Can you imagine what’s going to happen if we cut those monies and don’t replace them, what will happen? I’m seeing some articles in the paper saying that some communities could lose as much as 26 percent of their revenue.

P&G: You raise a point there with the personal property tax repeal push. It seems like if there is no replacement, we’re headed to a wave of municipal bankruptcies.

Dingell: Unfortunately, you’re right. Those communities have been cutting, and cutting, and cutting, and cutting. They cut the recreational programs, they’re closing parks, they’re not mowing (grass) and things of that kind.

They’re reducing their employment levels, they’re not filling jobs, they’re laying off police and fire.

The people in Lansing ought to be saying: ‘how much more of this can we do?’ And how much longer before the people say, ‘Look, enough.’

And if you talk about revenue, look at the roads and how we’ve got a bunch of road money coming in to build a bunch of roads Downriver. That’s 80 percent federal. Can you imagine if the feds weren’t pouring that kind of money into things like that what would be the situation?

P&G: On the federal debt, we have two Michigan delegates (Reps. Dave Camp and Fred Upton) who are on the so-called super committee tasked with coming up with a deficit-reduction plan. What are you looking for from the committee and have you spoken to either of them about what they’re going to be advocating for?

Dingell: I work with Upton all the time on different things. He and I together just got a major piece of legislation out of committee on pipeline safety. . .

I’m looking for them to try to do the best they can. I’m hoping these 86 tea partiers we’ve got are going to be willing to work to come up with a sensible conclusion because if we don’t, we got a huge mess coming. Because, the way that bill was written, if they don’t come up with cuts that make sense that can be properly negotiated — that’s the way that we should legislate — you’re going to find that instead we’re going to have a situation where cuts will be put in place.

Read this at the Press and Guide