GM Used TARP to "Repay" Loan

You might recall that on October 3, 2008, Democrats in Congress passed a massive bailout of Wall Street investment firms called TARP (Troubled Asset Relief Program), which the Congressional Budget Office (CBO) optimistically (or disingenuously) estimated would cost "only" $700 billion of your tax dollars. Although President Bush supported the massive TARP bailout of Big Business, not a single Republican in the House or Senate supported it.

Seeing big financial institutions get a government bailout, the Big Three American auto companies, GM, Ford and Chrysler, went begging to the federal government on November 19, 2008 to get their own multi-billion-dollar bailout. Congressional Democrats and President Bush agreed to an auto bailout bill that the CBO again optimistically estimated would cost "only" $15 billion. Conservative Republicans in the Senate, however, filibustered the auto bailout. Of 41 Republicans in the Senate, only 10 liberal or mushy moderates ones voted to kill the filibuster, along with 40 Democrats and the Senate's two liberal "independents" (who caucus with the Democrats). A supermajority of 31 Republicans (just more than three-fourths) joined 4 Democrats in supporting the filibuster. Without 60 votes to kill the filibuster, the Democrats failed to bring this second Big Business bailout to a vote, and it died.

Not to be deterred by Congress, President Bush unconstitutionally used an "executive order" to amend the first massive bailout law, TARP, to allow himself to give to the auto companies some of the money intended to bail out financial firms. GM and Chrysler eagerly took the TARP money, but Ford executives, wanting to keep their jobs, changed their minds. (Once Obama became president, he used the Bush-Democrat bailout of GM to force the old GM CEO to resign.)

On February 18, 2009, GM and Chrysler again approached the federal government, hats in hand, begging for another bailout. On February 24, Obama announced in an address before the joint session of Congress that he would give GM and Chrysler another $15 billion of your tax money. (It amazes me that liberal Democrats still run around claiming that it's Republicans and not liberal Democrats who support Big Business.)

You might have noticed recently that the new CEO of GM has been running TV ads where he crows about how GM has paid back the billions of dollars of your tax money that the federal government gave GM so that the United Auto Workers could continue to be the most overpaid union workers in the world. As Senator Chuck Grassley (R-Iowa) reports in the two stories below, however, Obama's GM CEO should be eating crow instead: TARP's own inspector general, Neil Barofsky, reports that GM merely used more TARP money to "pay back" the subsidies, which came largely from TARP money in the first place! So GM's much-vaunted repayment is half like using your VISA card to pay off your MasterCard--and half like using your VISA card to repay your VISA card! I must say that the Democrats' capacity for blatant deception never ceases to amaze me.

http://newsmax.com/InsideCover/charles-grassley-gm-bailout/2010/04/23/id/356756?s=al&promo_code=9CE6-1

http://www.foxnews.com/politics/2010/04/22/grassley-slams-gm-administration-loans-repaid-bailout-money/

My Fax to Congress: No New Taxes!

Using the "Visible Vote" application on Facebook, I sent the following fax to my members of Congress:

"Dear Senators and Congressman,

Please do not vote for this new 90%. Last year Democrats in both the Senate and the House voted for a provision guaranteeing the bonuses for AIG executives. Senator Dodd put the provision in the bailout bill, and he, Senator Obama and Senator Webb all voted for the bailout with the provision in it (and I voted to put the provision in the bill in the first place). I have little doubt that has Senator Warner and Congressman Connolly been in their current positions at the time, they two would have voted for it along with every other Democrat.

So don't pretend now that you opposed paying those bonuses. AIG made massive contributions to Democrat candidates, largest of all to Dodd and Obama, your feckless leader. I opposed the bailout and contacted Senator Webb at the time by email and fax, but he refused to listen, and went along with the Democrat herd. So now live with what you've done and don't pretend to be "outraged" and impose a 90% tax that will set a precedent for taxing others at a rate not seen since before JFK's big tax cut proposal, passed in the wake of his death in 1963. Instead of raising taxes, try not bailing out anyone anymore!"

For more on Dodd guaranteeing these bonuses, see http://www.newsmax.com/headlines/chris_dodd_bonuses/2009/03/17/192860.html?s=al&promo_code=7C62-1. For more on AIG making massive contributions to Obama and Dodd, see http://www.newsmax.com/insidecover/obama_AIG_bonus/2009/03/18/193222.html. For yet more on the hypocrisy of Dodd, Obama and other Democrats, see http://www.foxbusiness.com/story/markets/industries/finance/dodd-cracks-aig---time/.

AIG Execs Get Millions in Bonuses From Taxpayer Bailout

Late in 2008, Ben Bernanke, chair of the Federal Reserve Board, without any legal authority, bailed out ailing insurance giant, AIG. Bush and Congress approved of the extralegal bailout so much they started bailing out other failing financial giants, and wrote into the law a provision authorizing Bernanke to do what he'd already done. A majority of Republicans in both houses of Congress, however, opposed the bailouts, urging the government to let financial giants suffer from their own foolish policies.

In some sense you can't blame Bernanke, as it was the Keynesian inflationary polices of his predecessor, Alan Greenspan, that encouraged these financial giants, along with a little help from Fannie Mae and Freddie Mac (which "guaranteed" the loans) to make hundreds of billions of dollars in foolish loans to people who couldn't afford to borrow in the first place. Bernanke, Bush and congressional Democrats bailing out the financial giants that government policies encouraged to lend foolishly demonstrates how one government intervention leads inevitably to another. As Yoda said, once you turn to the Dark Side, forever will it dominate your destiny. Keeping in mind Yoda's advice--and the entire history of federal government regulation, starting with the Interstate Commerce Act of 1887, which Congress passed allegedly to lower railroad rates but which actually raised the rates, just like the Cable Reregulation Act of 1992 raised rather than lowered cable rates--it comes as no surprise that Fed inflation and Freddie Mae and Fannie Mae "loan guarantees" would lead to multi-trillion dollar federal bailouts.

Obama and the new, more-Democrat Congress have done a great job of continuing the failed policies of Bush, Bernanke, and the slightly-less-Democrat Congress of 2008. So it should come as no big surprise either that the executives at AIG are taking some of the $170 billion that the Fed and Congress spent to bail out AIG and paying $121 million in bonuses to corporate executives (themselves) and other employees. I mean, what's $121 million anyway, when Obama and Congress plan to spend about $8 TRILLION of your money this year? I mean, heck, that $121 million isn't even 10% of the $170 billion bailout. Why not skim 7% right off the top of the bailout to pay themselves for their good job in securing the $170 billion in the first place? I mean, if they hadn't gotten Bernanke, Bush and Democrats to bail them out, why, they would have had to have declared bankruptcy, and gone into receivership. The bankruptcy judge would have appointed a trustee to run the company, and the trustee surely would have fired all of the executives as part of cutting out the deadwood at the company and slimming it down for continued operations as an actual for-profit business. Those executives worked hard to save their jobs at the taxpayers' expense. They actually had to call Bernanke on the phone and ask for a bailout! That's tough work, no doubt, and worth every penny of the $121 million of your money that they stole from the taxpayer bailout of AIG to bail themselves out.

It's funny--or at least ironic, albeit sad--that liberals routinely rail against "the rich" and "Big Business" and then use taxpayer money to bail out both the rich and Big Business. Obama has already said that he thinks Congress should spend another $1 trillion or so on additional bailouts of the financial institutions wrecked by disastrous government policies, so don't be surprised if on Wall Street, the year 2009, while a horrible year for the stock market (which has, since Obama took office, fallen some 25%, from above its 2003 level all the way down to its 1997 level), shapes up to be the Year of the Big Bonus for executives of failed financial institutions. Ain't socialism grand?


http://www.nytimes.com/2009/03/15/business/15AIG.html?th&emc=th