Finally, a voice of sanity in the US Senate. Republican Sen. Mike Johanns of Nebraska, and former Governor of that State, has introduced a bill that is co-sponsored by 26 other Republicans in the the Senate to require Congressional approval for any use of TARP funds that would result in government ownership of private businesses through obtaining common or preferred equity stock shares.
He is calling it the "Free Enterprise Amendment." No Democratic Senator has signed on so far.
As Johanns rightly points out, the President and the Administration are operating unchecked in this arena. In my view, this is contrary to Constitutional provisions.
We certainly don't need more bailouts or public ownership of failing corporations. I've contacted my Senators. Calling on all free marketers to do the same.
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26 of the Senators sponsoring? 100 members of the Senate? Mathematically, I do not think that bill will go anywhere. I do not think we should be owning companies and if we have to it should be very short term. However, I do not think we should just hand them money without ever having a chance of repaying the taxpayers either
Linda,
It was just introduced yesterday. Let's give it a little time. We shouldn't own comapnies and we are not a bank. If they need money let them talk to a bank. I have seen models project that it is impossible for GM to ever pay back what it has and will be given. :)
Steve
Steve - I am almost lockstep with what Linda has said. We are damned if we do and damned if we don't with these bailouts. Some of these companies have become so large, that losing them becomes systemic to the remainder of our economy. As much as I hate pouring money into any failed company with lousy business practices, if we do so, we need to have our "loans/bailouts" securitized so the taxpayer has some opportunity to recoup it's losses. I think any ownership interest we take needs to be short term, transient, and ultimatly back in private enterprise as soon as possible.
Here's my wish for the day - I hope many of these corporations we have bailed out and now have a "temporary" stake in, will begin to recover, turn profit and we can actually make a few coins in the deal. When we bailed out Chrysler over a decade ago, that is what happened. The American taxpayers not only got their money back, we made interest as well. . .But, Chrysler obviously didn't learn the lessons from that era.
Myrl,
That is the beauty of capitalism and that's the lie that has been inculcated. Businesses can fail. It's OK. What about the 500,000 or whatever number of people are displaced if it happens? First of all people loose their jobs due to business closures or downsizing on a regular basis. Regardless of where people have been employed, there are alternatives. Let other companies hire them. Let them start their own business. Let them teach school. Let them get government jobs if they want. The "general welfare" clause in the Constitution does not pertain to keeping companies (just the hand-picked ones) afloat although many try to make that argument. :)
Steve
Steve- Nice post. I am featuring it in Tea Party.
Kevin,
Wow. Thank you. I am honored to have it featured in your group. :)
Steve
This looks good. I think that having 26 other sponsors within one day of being introduced is a positive sign. I agree with you totally.
Jim and Maria,
Thanks for your agreement and support. Let's follow this one and see if there's anything we can do. :)
Steve
Steve think of this, Lets say an average GM car is 25,000 we are pouring in 50 billion at that raet we cound have purchased 2 million cars and distributed them to American families. The whole thing is absurd. Look how many years we have been subsidizing Amtrak.
Hugh,
Direct payment to the American people was preferable - and more economically viable - than TARP, bailouts, GM, Citi, Chyrsler, and all the others. :)
Steve
Steve - now if we could only get a bill passed that would mandate common sense, rather than knee jerk reactions. Like a few have said, this bill won't get anywhere, but it should at least get some publicity.
Mike,
Unfortunately, it's not even getting the publicity like I thought it might. :)
Steve
Hi Steve
You may see support build for the bill; people are very upset about the wasteful government spending and many of the Senators and Congressman Seats could be in jeopardy.
Good luck and success.
Lou Ludwig
Lou,
I sure hope there are a lot of people in Washington househunting by this time next year. :)
Steve
Steve - I get the public ownership of infrastructure such as bridges, airports, light rail systems, etc. (even though I prefer privatization of even these businesses). I even get government guarantees on loans (again to a limited extent). However, the use of TARP funds to bankroll private for profit entities doesn't pass my sniff test. If you got a bad business model, call it quits - but don't ask the taxpayers to fund your bad decisions.
Ryan,
This is why the Constitution gave the federal government specific, limited powers - which over the years they have sought to expand - often when there is an "emergency." :)
Steve
I just don't see how the whole TARP be itself wasn't unconstitutional. And this law happened while Bush was in office, not Obama. Obama sure took the handoff and ran with it though.
Rob,
There is so much wrong with this. If it's not unconstitutional, it's got to be criminal in the way it was and continues to be handled. :)
Steve