Federal Bailouts Need Strong Congressional Oversight

Press Release

Like many of my constituents and colleagues, I am dismayed by the total lack of accountability over the numerous bailouts the federal government enacted over the past few months. As you may know, I opposed the $700 billion bailout, as well as the bailout of AIG and Citigroup - the latter two of which did not have any Congressional approval. Yet, with the federal government taking on over $8 trillion in debt and liabilities according to the Wall Street Journal, proper regulatory oversight is not only desirable but absolutely necessary.

On January 14, 2009, Congress began consideration of H.R. 384, the TARP Reform and Accountability Act. Introduced by Rep. Barney Frank (D - MA), Rep. Frank designed the bill to introduce greater accountability and transparency to the $700 billion bailout. While it does have many provisions that do just that, it also contains several provisions that give me cause for worry.

I worry that H.R. 384 is merely a vehicle to grease the wheels for a further $350 billion in funds. At this time, Congress has only made $250 billion available to the Treasury while the White House made available a further $100 billion. For the Treasury to have access to the next $350 billion, Congress must vote on a resolution of disapproval. Rep. Frank introduced the bill to specify how Treasury may spend the next $350 billion, while I believe Treasury should not have access to the next $350 billion.

However, the bill does require the Treasury to set benchmarks that institutions receiving assistance must meet. Additionally, these institutions must report quarterly with regards to whether or not they have increased lending. Such a requirement will force institutions to disclose why, despite billions of dollars in taxpayer funds, they are raising interest rates and reducing loan availability.

Yet at the end of the day, the balance sheet of the federal government is in disarray. The mechanisms used to solve the economic crisis are not working, and will not work under a scheme the Democrat controlled Congress and the administration concocted over one weekend in September. You can introduce as many rules and regulations as you may like, but if the patient is not responding, then the solution is to change the medicine.

Rest assured that I will carefully review the TARP Reform and Accountability Act. Congress is continuing to debate the bill, and it will not come up for a vote before the House of Representatives until January 21, 2009. At that time, I will keep the concerns of my constituents and the best interests of the country in mind.

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