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  • Guest Blogger: Senator Mike Johanns (R-NE)

    Mike Johanns

    WHY TARP NEEDS OVERSIGHT

    The announcement that the government would provide $30 billion dollars more in TARP funds to General Motors in exchange for a 60 percent ownership interest in the company is unprecedented and almost unbelievable.

    Who ever imagined the taxpayers would wake up Monday morning and find out a deal was cut behind closed doors to make them majority owners of General Motors? If you add all of the government aid GM has or will receive, the taxpayers, with zero input, have invested $50 billion dollars in a high risk bankrupt company. That’s almost one million dollars per job retained by GM.

    Sadly, there is no longer a dividing line between these private companies and the government.

    The government is now running or deeply involved in major industrial sectors of the economy: housing, banking, insurance, and automobiles. This is extremely troublesome and marks a fundamental shift in the way business is conducted in America.

    I believe this is the wrong approach and I am adamantly opposed to it. Some of my colleagues disagree with me. They believe the government should bail out the autos. Right now, none of us – whether for it or against it – has any say in whether the action goes forward. The legislative branch has effectively given the executive branch a free pass to do as it wishes with seven hundred billion dollars.

    TARP has become a license for government to experiment with private business. How do you think the original TARP vote would have gone back in September if members knew then what they know now? Remember, TARP was first presented as a toxic asset purchasing program to revive financial markets and to get credit flowing to consumers. That is what Congress approved. That’s all Congress approved. Then it became a blank check for failing banks; and the struggling insurance giant AIG; and the floundering housing market.

    Despite a December vote by Congress that rejected a bailout of the auto industry, TARP is now being used to bankroll the auto industry. How could anyone have predicted that an original plan to buy up toxic assets would be warped and twisted into the revolving slush fund it is today? People would have looked at me in disbelief if I had said – just a few months ago – that TARP funds would be used to buy General Motors. All this is happening without Congressional approval.

    The Free Enterprise Act would fix that. It’s simple and straightforward. It says any release of TARP funds that results in the government owning common or preferred stock will be allowed only if there is prior Congressional approval.

    Congress must reclaim its voice and duty to provide proper oversight of TARP. Let me be frank. I was not in the Senate when the first TARP vote occurred nor was I in office yet for the vote against providing emergency funds to the automobile industry. I was present in January and voted to disapprove President Bush’s request to release the second tranche of TARP. I did not agree with the way the first half of TARP was used, and I did not have faith that the second half would be spent in a more responsible manner, or that taxpayers would be fully protected.

    It passed anyway, and now the Administration has a blank check – actually, a stack of blank checks – to use TARP as a revolving fund for risky experiments in nationalizing private enterprise.

    As of right now, there are no checks and balances planned before we dole out $30 billion more to GM. My bill would ensure that Congress provides the oversight we were elected to deliver. It asks only for a simple majority, applying the regular rules of the Senate. But it makes a very significant statement: that Congress has not fallen asleep at the switch.

    The views expressed by guest bloggers on the Foundry do not necessarily reflect the views of the Heritage Foundation.

    Posted in Energy [slideshow_deploy]

    25 Responses to Guest Blogger: Senator Mike Johanns (R-NE)

    1. Carole Nemy says:

      So where, sir, is the outrage from your collegues? Where is this information out in the public sector? The liberal media would not dare to publish anything negative about Mr. Obama, his administration, or his Democratic followers in Congress. If the executive branch is overstepping their bounds then, I repeat, where is your public outrage?

    2. Jim Flud, Glen Rose, says:

      I'm 49 years old and have been self employed most of my life. I sold a buisness 2 yrs. ago and took a job with that company but the economy has taken it's toll and we are closing doors July 18th.

      I would like to start my own company again but don't trust this adminitration to let me keep any of my own money

      Thanks—-Jim

    3. Spiritof76, New Hamp says:

      Senator Johanns,

      This whole TARP thing is criminal. It is tyranny perpetrated by the federal government.

      I want you to introduce a bill to outlaw any activity by any federal government arm to interfere with private property and markets. I want you to criminalize any such action as a felony. The only way the government gets involved in our capitalistic system (the very little left of it)is if there is a breach of contract or fraud, both of which would involve law enforcement agency.

      I am afraid without any stern measures we will have a fascist state with dictator Obama in charge.

      It is disgusting to think that Sunday is our Flag day and shortly thereafter,July 4th. Would you explain to me what meanings do those important days carry in 2009 in the US other than they represent historical dates? We have become USSR (United States of Socialist Republic)thanks to the Washington cabal.

    4. Pingback: » Financial News Update - 06/10/09 NoisyRoom.net: “Extremism in the defense of liberty is no vice. Moderation in the face of tyranny is no virtue.” Barry Goldwater

    5. Chris Pedersen Nixa, says:

      Why is it that the Republican Party FAILS and REFUSES to advocate tirelessly,relentlously, at the top of their lungs, for the passage of the Fair Tax Plan [FTP]? (H25/S1025).

      Why is it that Obama {who is aware of the FTP and stated in a "sound bite" he needed to "study it closer"] fails every African American community and the American people as a whole by and through his intentional, willful , wanton surpression of the true "material facts" of the FTP?

      No demagoguery , no lies ,no twisting the ironclad boilerplate research where the three private citizens invested "their resources" of $22 million dollars to develop it.

      The Honorable Congressman John Linder (R-Georgia) introduce the Plan as the pending legislation, including the required "co-sponsers". Many in Congress have joined in, however most democrates refuse. As do Republicans.

      Mr. Linder , and radio talk show host Mr. Neal Boortz authored their two books entitled "The Fair Tax Book" & Fair Tax The Truth Answering The Critics".Read the darn books for a clear and convincing perspective.

      The fact of the matter is, as Boortz has stated, (paraphrasing)"The passage of the Fair Tax Plan with the "repeal" of the Sixteenth Amendment, abolishing the IRS's stanglehold over the American People, would be the largest transfer of "Power" from Congress back to the American People in the History of this Country"! In other words the Members of Congress are nothing more than Power hungry, the American People and the financial slavation of America be damned ! Where is the faith in "We The People" gone?

      It is obvious the people who voted for Obama voted for their wallets attached to the keys of the U.S. Treasury. Therefore, it is my contention the Republican Party MUST advocate nonstop for the financial salvation of the Nation by making the FTP its "Central Theme" for the 2010-2012 elections. This opens "Tent" all the way for the "inclusion of all" Americans and all consevatives. [ who are needed and must return to the Party ]

      If obama called for its passage, the democrats the lamestream media would be all over it faster than the Jackass [as their political symbol] would be on a feed bucket of sugar oats.

      Demagoguery wouldn't exist. It would be the greatest thing sense sliced bread. [because it is].

      If the Republician party can't out think the White House in this regard, for everyones wallet [no winners & loosers ant longer. Just Equality] then we the America people are in deeper trouble than we even know. A consumtion tax and not a "VAT" is the only method in which to save the Country. Abolish the IRS, the punisher of success!

      I'm convinced hands down, the "Tea Parties" & Fair Tax Rallys demonstrate it, while being demegogued by hatered and abuse towards those who participate in their attempt to save "their Own Money". How bright is that of the lamestream media? They can't even grasp the concept of saving themselves from themselves, and we are to believe they have creditability?

      It is my further contention, the democrats are so out of touch by their intentional silence to educate the American people of all the benefits afforded by the FTP. They're so wrapped up in their Power, they continue their "class warfare" status quo with those of K-Street (Kill The American people's Dream Street) picking the winners and loosers. Gaming the system. Therefore, everyone looses. The TARP proves that, on our backs as taxpayers. Here we go again !

      One legislative Bill, after another, the waste of our money never ends just to keep the lights on. It would help if the Bills were at least read before they were passed. I wonder if the Members of Congress done their homework in high-school and collage in this manner?

      I coined this phrase;

      "Liberty Equals Freedom–Financial Freedom Equals True Liberty". Also the "IRS equals: The Internal Racketeering Service of The United States Government". I guess Obama is the "Chicago Godfather". Go Figure, Ya Think ?

    6. Barb -mn says:

      The public outrage is ignored. The government continues to overstep it's boundaries setting anybody they can up for failure. The government needs more oversight of government's actions and words and their waking moments more then any private sector business. EVERYTHING THE GOVERNMENT HAS AND CONTINUES TO DO IS CORRUPT!!!!!!!!

      If any members of government want to compete with the private sector businesses of those mentioned, they have to follow the rules. Use their salaried money and not the money of the public who has no interest in ownership or whom lack the knowledge necessary of what the government is stealing from them to accomplish.

    7. Pingback: Instapundit » Blog Archive » HOW DO WE KNOW THAT THE OUTRAGEOUS SPENDING IS BECOMING A PROBLEM FOR OBAMA? Well, there’s the poll…

    8. Pingback: Round-up of recent Republican legislative intiatives « Wintery Knight Blog

    9. Grace, Florida says:

      I agree with Carol – where exactly is the outrage from the Republican Party? When are you all just going to stand up and say "enough". You are the voices for us and right now all I hear is silence. Being quiet is not working – start spending some money and purchase airtime – gosh do something. If it weren't for talk radio and a few publications we would have no clue what's going on.

    10. Lloyd Scallan - New says:

      OK, we all know what's going on under Obama. However, no one has an answer. In Louisiana we are

      stuck with Demo like Landrieu and Melancon that vote the way the national party tells them to vote. When election day rolls around, Acorn keep them in office. The Senator just says what we all feel, but he gives us no answers. Who has the answers?

    11. Tim AZ says:

      All I have read here are excuses to evade culpability to advance or get elected once again. Johanns pretends not to know that lending institutions were forced on threat of discriminatory lawsuits to give loans to people who would never be able to repay them. We the people have not been represented since the first bailout. The TARP legislation resulted in a shut down of communications from the citizenry to the government. The American citizenry demanded that capitalism be allowed to correct itself. All branches of government with extreme contempt for the Amercan citizen despite the oaths they have taken pursued their own agendas. Every elected official in Washington D.C. has disgraced them selves and their country by action or inaction and denial of the truth. We citizens can leave no incumbents in Washington D.C. over the next two elections. The People do not whant to own GM. The disgraced current government own their failures not the citizenry.

    12. James Carter, San An says:

      I have been outraged since the onset of this foolishness, but have no where to turn. I write my Senators (Cornyn and Hutchison) and get form letters in reply (sometimes on different subjects). I write President Obama and don't even get the courtesy of someone saying we heard you (I know they didn't). Transperency does not; repeat, does not, exist in this Administration.

      I salute Senator Johanns for this effort to and support his effort to gain some oversight. God Bless American.

    13. lee benson says:

      The Senator has made some good points. The readers have illustrated the amount of frustration being felt by the public. My point is that Republican polticians may have a window of opportunity to regain power, if they speak to the heart of true conservatives. But one more round of Republicans acting like Democrats and all bets are off. The Republicans will lose the support of conservatives while we look for an alternative and the Democrats will be in power for what ever little time my beloved country can hang together.

    14. LW, Newport News VA says:

      With all due respect to Senator Johanns who was not in office when the lst TARP was approved, what did anyone expect? The very purpose of that bill is stated in the opening lines—the Secretary of the Treasury to promote the general economic welfare of all Americans has unlimited power to distribute the money as he sees fit. Yes, the bill actually surrenders this unconstitutional authority to the Secretary. For lawmakers to now cry foul seems a little like the chickens running for cover when they discover the fox inside the hen house. TARP was a disaster that Americans overwhelmingly opposed. But what good did it do us to write or call Congress? None. I blame Bush for listening to bad advice. Now the mistake has been compounded through TARP II and the stimulus package, not to mention this huge porkulus budget.

      The Republican party MUST speak out on a united conservative front against these liberal policies. Today we hear there is to be a "pay czar" to cap pay, not just in the financial institutions but in all areas of business. (This administration doesn't even bother to consult Congress. Sadly most of its members would probably think this is a great idea. But can't this administration understand that by capping pay, they are penalizing the IRS? Less salary equals less taxable income. No, I doubt they've considered it, because if money coming into the federal coffers slows, they just raise taxes on all of us.)

      Can you see Oprah or Spielberg accepting $500,000 a year? Worse, they shouldn't have to, any more than a CEO or CFO should be penalized. If someone in charge of a company makes decisions that produce large profits, then that person deserves his/her bonus.

      We should all be working to achieve success (no matter how you define it) and to persue excellence. Compensation follows success and excellence. In the past we have been free to achieve (or fail). Now, our government will arbitarily decide the maximum we can earn. I mourn the death of our great free enterprise system which has produced the highest standard of living in the world and advances in inventions, technology, and medicine. Where will be the incentive now? Please, House & Sentate Republicans speak up.

    15. Ron Thompson says:

      The republicans are too afraid of the media to launch an outrage! Inside the beltway, drive people to not pay attention to anyone outside of the beltway. Even when the support for their outrage would be fully supported for the America outside the beltway! No answers is a trait of inside the beltway folks, because of their fear of the media and associates. So, Amercia dies because of silence!

    16. David E Aldridge, Da says:

      They(Congress) are too afraid of Obama pulling the porkulus to their district to speak up! Maybe, just maybe, we will get a voice to stand out and speak up for what the silent majority believe. This social experiment is going to ruin this country. Even the Chinese are laughing at our Sec. Treasury for telling them the dollar was "sound".Everybody in the world sees what is happening and yet not one of our "Congressional Leaders" has the guts to stand up and really fight Obama.

    17. Whicket Williams Kin says:

      I do not know what we can do to be heard I was shocked very badly at this last election I thought at least 1 congressman that was behind the collapse would lose, but I was wrong That is why they ignore us. We are to stupid to vote them out, even when they pass a 750 dollar bill that everybody was screaming" don't do it" so we voted for them The american voter is the dumbest animal on the planet, and, as all dumb animals is being consumed by predators. I have been saying " never re-elect any incubent" ever since I heard Kinky Freedman say it, and I have only seen it posted one time by anybody else. It seems to me that this is the best and most logigal solution, but nobody else seems to. So, you tell me, how do you get them to listen? writing letters is usless. All you get is a form letter telling you how they are doing exactly oppostite of what you say, and thank you for your support. Which is insulting.

    18. Al, The Villages, Fl says:

      Oversight!!! we need to cancel TARP and get the government out of the bail out business. This progressive movement will destroy this country. We need new leadership in congress and a republican president in 2012. Hopefully, the people will vote out dems/incumbents in 2010 and put in a congress that will stop the Obama socialist, progressive train. If the government was serious about doing something about the economy, we would see entirely different bills going forward – an energy policy, drilling for oil/gas, tax breaks, fair tax implemented, cut in spending etc.

    19. Julie Condon, Ogalla says:

      Senator Johanns-

      If you truely want accountability in what is happening in DC then I suggest that you co-sponsor S 604 that will require the audit of the Federal Reserve. All Americans deserve the right to know how our money is being spent. This is a privately owned company and yet $9 Trillion dollars are missing from it's balance sheets! Why can't the US Federal Govt issue the money and that way we won't have to pay interest on it like we do on the Federal Reserve?

      When are we going to get back to the Constitution? As long as Republicians stay asleep at the switch, huge amounts of spending is going to happen. I appreciate your efforts on The Free Enterprise Act but I fear that is only the beginning. We must abolish all laws that are unconstitutional! We are ready for you to "stand up" for Nebraskans and Americans!

    20. Steve M. Saginaw, MI says:

      I fully respect the comments of sen. Johanns and I hope that his constituents in his home state support him in the next election.

      As far as cars go. I just bought a Cadillac CTS last Thursday, just before the buy out. It will be the last GM car I ever buy.(every member of my family older than me…my father, father-in-law, uncles, in-laws, and others, are all GM retirees. Now that GM is OM (Obama motors) I am done!

    21. Jerry from Chicago says:

      I am happy to see the number of responses to this issue and even happier with the tone of them. I nolonger feel like the lone ranger. For too long I have been hearing and reading "Where's the outrage?". Well, I think I'm seeing a fair amount of it in these responses. We all may preaching to the choir, but I believe our choir is getting louder.

      Mr. Obama is being found out for who he really is. He is starting to be judged more on what he does and less on what he says. It's about time.

      One need only recall candidate Obama's campaign promises to post all proposed legislation on the Internet for five days before voting on it, so as to provide the American public the opportunity to view and react to it. Remember his campaign promises to review proposed legislation and exercise line item vetos on "earmarks" and pork barrell projects and that there would be no room for lobbyists in his administration. These are the things he promised. Now let's take a look at how President Obama's actions have fulfilled those promises. The $800 billion, 1,100 page "Stimulous" legislation was not posted on the Internet for five days of public review. It contained 8,500 "earmarks" and pork barrell expenditures, not a single one of which was vetoed by President Obama. In fact, neither President Obama, nor the Democrat controlled Congress bothered to read it before he signed it into law 24 hours later. Had President Obama bothered to read this legislation, he wouldn't have been surprised to learn that Senator Dodd had included language in the "Stimulous" bill that called for bonus payouts. The act of not reading the provisions of so expensive a piece of legislation before signing it into law is worse than simple arrogance, it's criminally stupid. And as for no lobbyists in his administration, well if we don't count the first three hiring exceptions to this promise, here he comes closer to keeping his word than any other promise.

      Yesterday, in Green Bay, WI., Mr. Obama assured his audience that "no one in government wants to take over the health insurance industry", they merely want to 'stimulate' a little competition. I seem to recall a very similar state made by Mr. Obama two weeks ago about no one in government wanting to take over the automobile industry.

      In the first six months of his Presidency, Mr. Obama has turned his 'inherited deficit' into something four times larger than what it was when he took office, and that doesn't include the cost of "healthcare reform". Almost unbelievably, President Obama and Speaker Pelosi are now attempting to cloak themselves in the mantle of fiscal conservatism, calling for "pay as you go". Apparently, these two are looking at the polls and discovering that more than a few Americans are fed up with the unending government spending spree. It also the prelude of the upcoming tax hikes to pay for it. If this weren't so monumentally hypocritical it would be funny.

      Some may recall that prior to taking on the job of turning around a failing Chrysler Corporation, Lee Iacocca was second in command of the Ford Motor Company, behind Henry Ford,III. Mr. Iacocca was the man behind the development of the Ford Mustang, one of the most popular and best selling model ever produced by the company. At the hight of his success, he was summonded into Henry Ford's office and was summarily dismissed. Reportedly, Mr. Ford was a little uncomfortable with Mr. Iacocca's success and fame, and with nowhere to promote Mr. Iacocca except into his own seat as C.E.O., Mr. Ford felt that Mr. Iacocca was expendable. Mr. Iacocca said "Henry, your timing is lousy. We have just come off the most successful year in the company's history and the sad thing is, you have no idea of how in the hell we did it."

      America over the past 200 years has grown to be the economic envy of the world. Yes there have been bad times, recessions and even a depression. We have always managed to come out of these bad times without a government takeover of business. We maintained our belief in capitalism and of free enterprise and it worked. Like Henry Ford, III, I don't think Mr. Obama knows how the hell we did it. I don't necessarily blame him for that. He is young and inexperienced. He has never run a business, never had to rely on bank loans to produce goods or services and never had to meet a payroll. He has never had to do these things under the constant and ever changing laws, rules and regulations of the government and its various agencies. Mr. Obama needs to learn; we are paying his tuition; it's getting to be prohibitively expensive.

      As Ronald Regan said, "The problem isn't so much that our opponents don't know things, but rather it's that so much of what they do know just isn't so."

    22. Pingback: The Destructive Fiscal Policies Of A Radical President : Conservative Nation

    23. Byren Stowe SLC, Uta says:

      The Obama administration after this facist act, has used its own controling interest to place more control over GM into the hands of the very union that caused GMs woes in the first place. Why? Because they (the UAW) are in the tank with Obama. Then they disenfranchise dealerships all over the country and simultaneously trade Hummer to china for incurred debt used to advance their agenda. WE GAVE A MILITARY BASED PRODUCT TO A COMMUNIST COUNTRY!!! Then there is the environmental hipocracy of that move. Absoloute hipocracy!

      As an American, I find this Government overtaking of one of the most enduring PRIVATE SECTOR US entities as nothing less than a blatant and agressive facist act and as such I am appauled, disgusted, and very much concerned!

      I have been a GM guy since the 60's. Ive owned numerous GM trucks, cars and suvs. I currently own a 2006 HHR and a 2006 Cobalt as well as a '65 Chevelle. A good friend of mine used to call me "the chevy guru". But no more! I will not support the downtown debacle that has assumed control of General Motors, not willingly, not with my wallet! Im moving on and I hope other Americans do as well. Time to check out autos made in "right to work" states. What has become of America?

    24. Byren Stowe SLC, Uta says:

      Incidentaly, how many jobs is this administration generating by cutting out fee paying dealerships and moving divisions of GM to other countries?

      Lies! Lies and treachery! Color me angry!

    25. Pingback: Senator: Free Trade Is All Well And Good, But Who Will Protect Americans From The Yellow Peril? | Popehat

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