The so-called “Big Three” domestic automakers, General Motors, Chrysler, and Ford have kicked into overdrive to lobby Congress to salvage what is left of their business operations using taxpayer funds. General Motors, which has entered negative cash-flow territory, is widely predicted to go belly-up unless it receives massive infusions of money. Analysts predict that GM’s demise would drag the other two down as well. After two days of contentious hearings on Capital Hill on November 18 and 19, auto executives departed without a deal and, at least for now, Congress has slammed the brakes on a straight bailout. Instead, lawmakers have tasked automakers with furnishing a detailed plan for long-term industry “viability and sustainability” before any legislative action is taken.
The 111th Congress: House of Card Check
Ironically, as Congress debates a bailout for the auto industry partly as a result of its massive, union-stimulated legacy costs, there are widespread expectations that Congress and the Obama administration will quickly try to push though the so-called “card check” legislation after the inaugural parties wind down.
ACORN: Taxpayer Seed Money Underwriting Corruption and Voter Fraud?
Voter registration and vote fraud is once again front and center as November 4 approaches. As in previous elections, the Association of Community Organization for Reform Now, or ACORN, is at the center of political and legal storms.
Treasury’s Toxic Waste Dump…on Taxpayers
The move is unprecedented and historical; the price tag, up to $700 billion, is staggering; reaction in the nation’s capital has been fluid, chaotic, enraged and, now, perhaps obstructionist.
Incensed Over Incentives
H.R. 3221, the housing bailout bill that President Bush signed on July 23, 2008 is a $300 billion handout to home builders, mortgage companies who made bad loans and borrowers who took loans for homes they could not afford. The bill was exacerbated by the last-minute inclusion of a potential $25 billion (or more) taxpayer subsidy for the nation’s two mammoth government-sponsored enterprises, Fannie Mae and Freddie Mac. Despite claims that the money would not be used, the taxpayers may be on the hook sooner rather than never. It turns out that there were other nasty surprises tucked into the bill as well.
GSE Monster Mash-up
On Friday, July 11, the nation’s two largest housing government-sponsored enterprises (GSE), Fannie Mae and Freddie Mac, began a precipitous stock slide that stirred a mini-panic on Wall Street and among government officials. There was a frantic bid to craft a government rescue plan over the weekend. On Monday, federal officials rushed to the nearest open microphone to reassure the nation that these mortgage behemoths were in no real danger of going belly up.
Coconut Road Outrage
An update on the ongoing drama associated with what CAGW has dubbed “the immaculate earmark.”
IRS Still Plagued By Security Vulnerability
The Government Accountability Project (GAO) released a report on January 8, 2008 documenting the mediocre progress made by the Internal Revenue Service (IRS) toward tightening its information security systems. The GAO said: “The IRS is at increased risk of unauthorized access to and disclosure, modification, and destruction of financial and taxpayer information, as well as inadvertent or deliberate disruption of system operations and services.”
Big Time ARM Wrestling
The country continues to experience uncertainty and volatility in the financial markets as a result of the crisis in the mortgage industry. Financial services companies have been hit hard. For example, Merrill Lynch announced an $8.4 billion writedown in October, and Citigroup received a $7.5 billion infusion of cash from investors in Abu Dhabi, United Arab Emirates.
For its part, Congress has been trying to help homeowners who face foreclosure or need help refinancing homes they can no longer afford. Developments in the mortgage market are fluid and the industry began taking corrective action to mitigate problems for some subprime borrowers. One housing advocate told The Wall Street Journal that some loan-service providers are “already freezing rates for five to seven years.”
Lawmakers Choose Pork Over Bridge Safety
The I-35 Bridge collapse in Minneapolis, Minnesota, which resulted in the deaths of 13 people, dominated several news cycles and gave politicians the kind of somber photo ops they can rarely resist. Some, including House Transportation and Infrastructure Committee Chairman Jim Oberstar (D-Minn.), called for an increase in the federal gas tax to pay for the long-standing unmet need for bridge repair. Congress went back to business as usual, earmarking billions of tax dollars for frivolous projects in the Senate Transportation, Housing and Urban Development Appropriations bill.