Executives try to keep egg off their faces

On Wednesday the heads of several of the largest lending institutions in the United States were called to testify before the House Financial Services Committee. All of the individuals testifying represented lending institutions which received financial assistance from the federal government several months ago under the Troubled Assets Relief Program (TARP). Committee members inquired about the use of the TARP money thus far.

Committee Chairman Barney Frank (D-Mass) said that the aim of the hearing was to adopt rules to make sure this situation did not happen again in the future, while restoring the system of extending credit in the United States. Frank said that although the hearing would focus on what transpired in getting the country into this situation, his committee would be “looking forward” at what progress can be made. Congressman Paul Kanjorski (D-Penn)said that when these lending institutions took taxpayer money, they “moved into a fishbowl”, and that all eyes are justifiably on how they use the money. Recent public outrage at the seeming misuse of taxpayer money in the form of executive compensation (anger which Chairman Frank called “justifiable”) has left many asking what role the federal government should play in overseeing the use of these funds to make sure that the taxpayer money is being used wisely.

Lloyd Blankfein of Goldman Sachs said that the TARP bill was important to maintaining the overall stability of the financial system. Most of the executives testifying said that their institutions are still lending, but after and extended amount of inquiry from committee members, it is uncertain if the TARP money has actually encouraged these institutions to lend more than they have in the recent and distant past, respectively. Jamie Dimon of JP Morgan Chase & Co. said that his company is committed to helping homeowners avoid foreclosure and stay in their homes. Vikram of Citi said that taxpayers have a right to expect a return on their investments, and said that he personally has volunteered to have his salary set at one dollar per year until the company returns to a profitable state. Chairman Frank asked the members of the lending community to withhold any new foreclosures until Treasury Secretary Tim Geichner’s program could be put into place, but at present it is uncertain whether than will happen.

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

Hoyer: Conference Committee will be a “consensus seeking process”

While speaking at a pen and pad session on Tuesday, House Majority Leader Steny Hoyer stated that the Conference Committee on the Economic Stimulus package is going to be about seeking consensus. Since the Senate amended the economic recovery bill which came out of the House, the House and Senate need to settle on a final version in a Conference Committee. Hoyer would not specify what the House’s priorities in the Conference Committee would be, but said that he hopes to pick up votes in the House. He continued that he hopes Republicans in the Senate will be willing to compromise further, because they have been “gambling” with America’s future, and have been more concerned about rebuilding the Republican Party than in rebuilding the economy. Hoyer said he has not spoken with Senators Spector, Snowe, or Collins, the Senate Republicans who supported the bill, and that their stated unwillingness to negotiate about certain portions of the bill in Conference was not reasonable.

When asked if the price tag of the bill will be larger once it comes out of Conference, Hoyer said no, and highlighted that the original House bill was less expensive than the Senate version by several billion dollars, and created half a million more jobs. Job creation is the main focus of the House in this stimulus package, according to Hoyer, who said that helping those hurt by the crisis was a top priority. The final question during the session asked if $1.5 trillion dollars was enough money to invest in the recovery package, and Hoyer said that the fact that we are talking about numbers of this magnitude really says something about the sorry state that we let our economy slide into.

Hoyer said that the Conference Committee is expected to start immediately, and says he thinks the president would sign the House version of the bill “enthusiastically”.

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

Russia dominates Central Asia through oil policies

Dr. Stephen Blank, Professor at the U.S. Army War College, speaks about Russia's domination of Central Asia's oil markets through the use of pipelines.

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

Oil a political tool for Russia

On Monday the American Foreign Policy Council held a conference on the United States’ foreign policy towards Russia. Steven Pifer of the Brookings Institute said that Russia is engaging in a policy which is meant to keep the West out of the former soviet states, while reasserting its own power and expanding its sphere of influence.

Oil is the principle tool Russia has for accomplishing these goals, according to US Army War College Professor Stephen Blank. Blank called oil a “Swiss army knife” for advancing Russia’s interests, and said that Russia’s protected and subsidized energy market has risen to power because of pipeline control. He continued by saying that Russia’s move to own pipelines and distribution centers is a plan to dominate Europe through “forced dependence” on Russian gas and oil. Dr. Blank recommended that the U.S. and the E.U. reduce their respective dependence on Russian oil, and that the E.U. strive for internal political unity.

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

Gingrich criticizes Obama's approach to Economy

Former Speaker of the House Newt Gingrich criticizes President Barack Obama's approach to the economic stimulus bill. He specifically says that "governing is not campaigning", and that Obama may be approaching the bill too hastily, because it's a bill he will have to live with for the rest of his presidency.

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