Rewind several years ago and Louisianians would have laughed if someone said the federal government would bail out a Wall Street bank if it was about to fail. We would've chuckled if we were told that the federal government was going to bail out a failing auto maker. And we'd never take seriously the idea that the federal government would give a $108 billion bailout to a foreign country like Greece.
Unfortunately, more than a trillion dollars later, the Wall Street bank and auto bailouts not only happened, but are in the rearview mirror. But it's not too late to stop the spending train before the U.S. makes a common practice of bailing out bankrupt foreign countries.
At a joint press conference in the White House with German Chancellor Angela Merkel on June 7, 2011, President Obama addressed the debt crisis in Greece by saying, "We have pledged to cooperate fully in working through these issues both on a bilateral basis but also through international and financial institutions like the [International Monetary Fund]."
Last week I joined U.S. Sens. Jim DeMint (R-S.C.), Orrin Hatch (R-Ut.) and John Cornyn (R-Tx.) in offering an amendment to the Economic Development Revitalization Act to roll back the International Monetary Fund's (IMF) ability to use $108 billion in taxpayer dollars to bail out foreign countries, including Greece, which is now heavily in debt thanks to years of irresponsible spending decisions.
According to information available on the IMF website, the debt of Greece as a percent of GDP for 2009 was over 126 percent and in 2010 was over 142 percent. And, according to CMA DataVision, a credit default monitor, the costs of insuring against default on government debt sold by Greece skyrocketed to record highs this week. As a result, I believe that it's highly unlikely that Greece will ever be able to repay any loans provided to it by the IMF.
Quite frankly, the federal government needs to get out of the bailout business altogether. Bailing out Greece while America is nearing bankruptcy is just puzzling to me, but rest assured that some of us in the Senate are working to actually address our increasing deficit and finally end bailouts.
I am interested in hearing your thoughts on how we can help more Louisiana families prepare for hurricane season. Please contact me with your ideas at any of my state offices or in my Washington office by mail at U.S. Senator David Vitter, U.S. Senate, 516 Hart Senate Office Building, Washington, D.C. 20510, or by phone at 202-224-4623. You can also reach me on the web at http://vitter.senate.gov.