Trimming Down the Bailout, Adding Oversight
Statement
Yesterday I introduced legislation that essentially will cut the $700 billion bailout in half. This measure (H.J. Res. 101) disapproves of the second half of the bailout funding, which must be requested by the president (whether Bush or Obama).
If passed, this measure will save taxpayers $350 billion and significantly reduce our future national debt.
Media General reports:
Rep. Virginia Foxx, R-N.C., introduced a bill Wednesday to cut in half the $700 billion Wall Street bailout package.
Under the program, which was designed to shore up the financial system by allowing the government to purchase toxic mortgage-backed securities, the Treasury Department has injected nearly $290 billion into troubled banks.
If Treasury wants to spend more than $350 billion, it must submit another request to Congress. If that happens, it would trigger a vote on the legislation introduced by Foxx, which would deny that request.
I also penned an op-ed for Human Events yesterday, explaining just how this legislation works and why it is necessary:
The whole bailout concept is now completely different than the bailout that was sold to America back in September (a concept I didn't buy in the first place). After this bailout "bait-and-switch," why should anyone believe that the next round of $350 billion in taxpayer money is necessary or even that it will be used judiciously?
With this question in mind, I thought it was time to exercise one of the checks and balances in the bailout law. The bailout law gives Congress the power to "disapprove of" the second half of the $700 billion in bailout cash.
Treasury was allowed to use $250 billion in bailout funds upfront and another $100 billion kicked in when the President requested additional funding. Now $350 billion is in the hopper waiting for the next industry or company the government deems "too big to fail."
Congress can stop the madness. According to the new bailout law, Congress can withhold the next $350 billion of the bailout within 15 days of when the President whether it's Bush or Obama requests the second half of the money.
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