Why The 5th District Could Not Afford This Week's $700 Billion Bailout

Press Release

The last month has seen wild fluctuations in the United States financial markets. With massive taxpayer funded investments in companies like AIG and Bear Stearns, the American public has taken on an unprecedented role as the so-called bailout queen of Wall Street. When a hastily crafted bill came before Congress this week, I was asked to spend $700 billion of your hard earned tax dollars on an idea that had no guarantee of success, had inadequate oversight, and would have saddled American taxpayers with massive amounts of new debt. I could not in good conscience support this plan, and along with a majority of my colleagues, voted no.

While some form of government intervention is likely necessary to stabilize our economy, it is unbelievable to me the amount of new debt and financial risk the government has taken out of the hands of the private sector and saddled on the backs of taxpayers. Since January of 2007, Speaker Pelosi has tried to expand our debt obligations, what you and your children and grandchildren owe, from under $9 trillion to $11.3 trillion. That is a roughly 25 percent expansion of our national debt in less than two years. Thankfully this expansion was rejected by the American people and by the House.

I return home to Florida every weekend, where I speak to my friends and neighbors about what is happening in their lives. I hear stories about the everyday challenges facing Florida families, whether it is the declining value of a home, the hard time their daughter is having finding a good job, or how the high cost of gasoline is keeping them from taking a family vacation this year. These hard working men and women have a difficult time seeing how a taxpayer funded bailout will lower their gas prices and help find them a job. They look to Congress to find solutions, not make yet another problem.

Helping people is what I came to Congress to do, not throw good money after bad. Just a couple of weeks ago the government bought up Fannie Mae and Freddie Mac. This week we learned that the FBI is investigating these two firms and has in fact delivered subpoenas to the companies. This is on top of the massive fraud and accounting scandals that have rocked Fannie and Freddie for the past three years. Instead of a taxpayer funded bailout, we should have a taxpayer funded investigation of what role corporate officials like Franklin Raines, Jamie Gorelick and Jim Johnson played in this massive fraud on the American public.

This week the House rejected a bailout bill that was seriously flawed, and would not have brought about the type of recovery the American public demanded and needs. As I previously mentioned, the bill tried to increase the debt ceiling to $11.3 trillion, a huge amount that your children and grandchildren will be forced to pay back for years to come. The bill also would have made the federal government one of the largest stockholders in the nation, something that I have deep concerns endorsing. While the public should get something in return for our multi-billion dollar investment, do we really want government bureaucrats running Fortune 500 companies?

Perhaps most egregiously, the bill defeated by the House this week would have given the Secretary of the Treasury the blanket authority to bail out foreign banks at the expense of American taxpayers. There was no limit on what type of foreign bank could receive funds, and even those with no U.S. subsidiaries would have been eligible for aid. If American taxpayers are being asked to spend nearly a trillion of their tax dollars on a government backed bailout of the financial markets, the least we can do is to guarantee that only American companies will receive the benefits of the program. Russia, Venezuela and China should not receive one penny of American taxpayer funds.

At a time when the public is crying out for bipartisanship and an end to the class warfare that has so divided this nation, the bailout bill that I voted against yesterday would only have perpetuated that division and driven us further apart. Instead of helping more people achieve the American Dream of homeownership, this legislation creates two classes of homeowners; those who are responsible and those who are irresponsible. The plan bails out the irresponsible at the expense of those who make their mortgage payments, pay every bill, and live within their means.

I also wanted to point your attention to a letter written by a large group of the finest economic minds in the country, including four Nobel Laureates. This group of economists came out in public opposition to the bailout package and outlined their concerns in a letter to Congress. I hope that you find their comments and analysis of the bill worth reading. http://faculty.chicagogsb.edu/john.cochrane/research/Papers/mortgage_protest.htm.

As Congress moves forward and addresses the current economic situation, I will continue to work with my colleagues on the Financial Services Committee to find bipartisan solutions that protect the American taxpayer and stabilize our economy. Placing blame and pointing fingers will get us nowhere in this debate. We need to set aside our Party labels and work toward commonsense solutions that meet the needs of American families and protect our shared interests. At this point, if the legislation comes back for my approval without substantial changes, however, I will not be able to support it.

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