House Dems To Answer GOP With Budget Proposal Of Their Own

By Anna Cameron

During a speech at the Center for American Progress Tuesday, Rep. Chris Van Hollen (D-Md.), the House Budget Committee’s ranking member, revealed that Democrats will introduce a FY 2012 budget plan of their own on Wednesday in response to the GOP proposal released last week.

Chastising the Republican budget drafted primarily by House Budget Chairman Rep. Paul Ryan (R-Wisc.), Van Hollen referred to the proposal as a “yellow brick road for the already prosperous, and a dead end for the rest of the country.”

“The Republican budget dismisses much of the American experience,” said Van Hollen. “It recognizes the importance of individual self-reliance…but it fails to recognize…that out of many we unite as one…to advance the common good.”

Van Hollen noted that the Democratic proposal would reach a similar fiscal balance target as that of the GOP blueprint, while still managing to maintain a commitment to outbuild, out-educate, and out-innovate.

In order to reduce the deficit and foster economic growth, Van Hollen alluded to cuts in military spending, as well as a tax hike for the wealthy.

“Our budget will reduce the deficit and remain true to our values…in a steady, predictable way,” said Van Hollen. “It is a sensible and balanced approach.”

Though the Democratic proposal will gain no traction in a Republican-controlled House, the initiative will demonstrate the party’s commitment to balancing the budget and reducing the deficit - an important notion in light of attacks from the right that state otherwise.

President Barack Obama is expected to release his own plan for deficit reduction Wednesday. The GOP proposal attempts to cut $6.2 trillion over the next decade by reforming the Medicare and Medicaid models, freezing discretionary spending and altering the tax code. 


Congress questions Lehman Brothers CEO

Chairman and CEO of Lehman Brothers Holdings Richard Fuld Jr. said that his company's fall could have happened to anyone because "nobody expected such decline" in the housing market. Rep. Jim Cooper (D-Tenn.) said that while Fuld claimed this could have happened to any company, "it didn't happen" to other companies.

Fuld said that Lehman Brothers's capital was in good shape on September 10, five days before the company filed for bankruptcy. Rep. John Sarbanes (D-Md.) called Fuld's account of the fall of the company "implausible."

Fuld said closing the mortgage business of Lehman Brothers down would have been a good idea in retrospect, but others would have considered that "irrational" at the time. Rep. Peter Welch (D-Vt.) said that companies had taken the business of mortgage lending, and "put it on steroids."

Rep. Chris Van Hollen (D-Md.) said that the previous compensation packages Fuld had accumulated (Fuld said he received about $350 million in compensation while at Lehman Brothers) should be given to the shareholders of the company. Fuld said he suffered financially from his company's bankruptcy considering he was "the single largest shareholder."

Fuld said that while he gave the U.S. Securities and Exchange Commission (SEC) high marks, "the overall regulatory system has to be redone." Rep. Diane Watson (D-Calif.) said that the SEC was either "unable or unwilling" to regulate companies such as Lehman Brothers.