Boehner on President’s budget: It is time for a do-over

By Suzia van Swol-University of New Mexico-Talk Radio News Service
House Minority Leader John Boehner (R-Ohio) spoke today about the news conference President Obama will hold this evening. A lot of Americans believe that our economy is in a crisis and they are looking to Washington for solutions, said Boehner. “I believe that Republicans are offering better ideas to the president in hopes of building a better budget.”

Republicans plan to release an alternative budget sometime next week and Boehner said that, “Our alternative will create jobs by allowing American families and small businesses to keep more of what they earn.” He went on to explain that it will ensure that the federal budget doesn’t grow faster than the family budget as well as expand access to healthcare while preserving Social Security and Medicare and reform the financial system.

“This isn’t the first time we’ve offered better solutions, and the resident knows that,” stated Boehner. He explained that he and Congressman Eric Cantor (R-Va.) personally delivered the president a stimulus proposal at the White House in January, “and what was the response? The White House pretended they never even saw it,” said Boehner.

Boehner said that the president’s budget spends too much, taxes too much, and borrows too much from our kids and grandkids. In a time when our economy is in serious recession, “I think Americans deserve better,” stated Boehner.

Boehner said that the President’s budget hurts our economy and destroys the very jobs that we are trying to save and create. “It includes irresponsible levels of spending reaching 5.1 trillion (dollars) ten years out,” and it doubles the debt on our kids and grandkids over the next six years said Boehner.

“I just think that this may be the most irresponsible piece of legislation I’ve seen in my legislative career,” and “It is time for a do-over,” concluded Boehner.

Geithner, Bernanke & Dudley defend AIG

by Christina Lovato, University of New Mexico-Talk Radio News Service


“This is an extraordinary time and the government has been forced to take extraordinary measures. We will do what is necessary to stabilize the financial system, and with the help of Congress, develop the tools that we need to make our economy more resilient and our system more just,” said Treasury Secretary Timothy F. Geithner at a House Committee on Financial Services hearing.

Today, William Dudley, the President and Chief Executive Officer of the Federal Reserve Bank of New York along with Ben S. Bernanke, Chairman of the Board of Governors of the Federal Reserve System and Treasury Secretary Timothy F. Geithner testified in front of Congress and were hammered with questions regarding the American International Group, Inc. (AIG), a company at the center of the economic crisis.

Bernanke said that the Federal Reserve along with the Treasury made their decision to lend $85 billion to AIG in September 2008 because they agreed that AIG’s failure under the conditions then prevailing would have posed unacceptable risks for the global financial system and for the economy. “Global financial markets were experiencing unprecedented strains and a worldwide loss of confidence.... At that time, no federal entity could provide capital to stabilize AIG and no federal or state entity outside of a bankruptcy court could wind down AIG,” said Bernanke. When it came time to talk about AIG’s payout of retention bonuses to employees at AIG’s Financial Products Unit (FP), Bernanke stated, “It was highly inappropriate to pay out substantial bonuses to employees of the division that had been the primary source of AIG’s collapse.... I asked that the AIG-FP payments be stopped but was informed that they were mandated by contracts agreed to before the government’s intervention.”

Dudley stated that he believes AIG’s Chief Executive Officer, Edward Liddy, weighed a number of factors in when deciding not to attempt to prevent payment of retention awards owed to AIG-FP employees. Dudley said that the factors include “the likely negative effects of disruption in staffing at FP in managing its multi-billion dollar exposures, legal advice that the contracts were valid, meaning that breaking them would likely increase the amount of company funds ultimately paid to the covered employees and the negative consequences to AIG’s business that could result from the public abrogation of these contracts.”

Geithner said that the Treasury is working to promulgate rules and to develop a program under the original TARP legislation to review certain bonus awards already paid. Geithner stated, “The proposed resolution authority would allow the government to provide financial assistance to make loans to an institution, to purchase its obligations or assets, to assume or guarantee its liabilities, and purchase an equity interest.... This proposed legislation would fill a significant void in the current financial services regulatory structure in respect to non-bank financial institutions. Implementation would be modeled on the resolution authority that the FDIC has under current law with respect to banks.” Geithner concluded the hearing by saying, “This plan will work. This plan because of the authority provided by the Congress, not just of the Treasury, but the fed, gives us broad ability to do what you need to get through a financial crisis like this.”

Congressmen urge Obama to reconsider troop surge in Afghanistan

By Michael Ruhl, University of New Mexico – Talk Radio News Service

Today a league of congressmen sent a letter to President Obama asking him to reconsider his military policy in Afghanistan before committing 17,000 new troops in a surge. The letter said, “As the goals of our seven year military involvement remain troublingly unclear, we urge you to reconsider such a military escalation”. This letter came from a bipartisan group of 14 members of Congress.

Congressman Ed Whitfield (R-Ky.) said that he is “perplexed” by the president’s troop increase, considering that his administration has stated it is presently reviewing its strategy in Afghanistan. Congressman Jim McGovern (D-Mass.) said that America is getting deeper into a “war without end” and that we need an exit strategy in Afghanistan.

Both Ron Paul (R-Texas) and Dennis Kucinich (D-Ohio) expressed concern on waging an endless war in such a time of economic peril. Kucinich said what the country needs is a healthcare surge, a home ownership surge, and an employment surge.

Republicans move for stimulus package free of spending

By Michael Ruhl, University of New Mexico - Talk Radio News Service

It may seem like magic to some these days that one could stimulate the economy without spending a nickel, but that’s exactly what Senator David Vitter (R-LA) and 40 other Congressmen are proposing. A bill to be introduced concurrently in both the Senate and the House would provide revenue and create jobs by drilling for oil domestically. The focus of The No Cost Stimulus Act of 2009 would be primarily energy, because in addition to further tapping domestic gas and oil reserves, it would streamline the process for creating nuclear power plants, which the bill sponsors say would create jobs. According to the sponsors, it would also lessen EPA regulation of CO2 under the Clean Air Act, which the Congressmen claimed would save 500,000 jobs annually and saves over $7 trillion in GDP over the next 20 years.

Congressman John Shadegg (R-AZ) said that currently we are outsourcing our energy production, providing jobs to regimes such as Russia, Venezuela, and Saudi Arabia, when these very same jobs can be done domestically with our reserves.

The specific regions to be further tapped for their energy potential include the Outer Continental Shelf (OCS) and ANWR, which the Congressmen estimate alone would create nearly 2 million long term high paying jobs.

Pelosi: Stimulus creates jobs, jobs, jobs, and jobs and jobs

By Suzia van Swol, University of New Mexico-Talk Radio News Service

Following a Democratic Steering and Policy Committee listening session on the economy, Speaker of the House, Nancy Pelosi (D-Calif.) said that, “we just had a very productive session with some leading economists who for over a year now have been giving us advice and guidance and an assessment of the state of our economy and some judgments about how we should go forward.” She went on to state that, “it is very clear that as we implement our recovery package, we must make sure that it works. And again, confidence is a big part of that investment that we have made. And we also must make sure the public understands this is a very fiscally sound package. The choices that were made in it were to create jobs, jobs, jobs and jobs and jobs as soon as possible and jobs over a period of time to stabilize the economy.” Pelosi emphasized that the baseline for spending has not been raised, but rather the stimulus is targeted in a timeframe to make the difference.

Congressman Barney Frank (D-Mass.) said that this is not some effort to supplant the private market, and he believes that what we are doing is actually very pro market. “We are halting the erosion and laying the foundation for things to get better,” stated Frank.
He expressed that one of the things the market suffers from today is a lack of investor confidence, “I think there is this danger that people will look at the mistakes that were made in the administration of the TARP funds in the past administration inpute them to the current administration,” said Frank.

Congressman George Miller (D-Calif.) said that we cannot discount the amount of time that was lost during the previous administration. “What we now see is a concentrated effort to refine those programs, to make sure that they are accountable, to make sure that in fact there is a response to the actions we are taking,” said Miller. He stated that the first release of the TARP money really discouraged the public because they saw billions of dollars flow to the money center banks and nothing loosening up.

The Speaker and members of Congress will continue to call on economists to provide expertise on the best way to move forward during this long term process of restoring the economy.