Senator James Inhofe has called for legislation requiring congressional approval of any further spending of the $700 billion bailout money. Language in the bailout bill, as passed, has given Secretary Paulson sole discretion over how the money is spent—with zero oversight. As I've reported before, the bill says he cannot be investigated, nor even officially asked where the money is going. He has said he won't tell congress who is getting the money.
KFOR
"It is just outrageous that the
American people don't know that Congress doesn't know how much money he
(Treasury Secretary Henry Paulson) has given away to anyone,'' the
Oklahoma Republican told the Tulsa World.
U.S. Sen. Jim
Inhofe said Saturday that Congress was not told the truth about the
bailout of the nation's financial system and should take back what is
left of the $700 billion "blank check'' it gave the Bush
administration.
"It could be to his friends. It could be to anybody else. We don't know. There is no way of knowing.''
What Paulson has said is that he has changed course 180 degrees and will not be buying bad mortgage debt, but will instead be directly purchasing equity stakes in major
financial institutions. Inhofe contends, and rightly so, that this indicates that even Paulson believes that the plan, as originally conceived, can not work.
Via Drudge:
WASHINGTON, D.C. - U.S. Senator Jim Inhofe (R-Okla.), in a letter to
his Senate colleagues, laid out his plan to push for legislation that
will require Secretary Paulson's plan for the remaining $350 billion in
authorized Troubled Asset Relief Program funds to be ratified by an
affirmative vote in the U.S. Congress. In the letter, Senator Inhofe
writes that the lame duck session provides Congress a tremendous
opportunity to change course. Below is the text of the letter.
Dear Colleague,
I write to inform you of the actions I will be taking during the lame
duck session of Congress regarding the funding status of the Troubled
Asset Relief Program (TARP). Given the recent news about Secretary
Paulson's execution of the TARP program, I firmly believe action is
required by Congress. I plan to push for legislation that will require
Secretary Paulson's plan for the remaining $350 billion in authorized
TARP funds to be ratified by an affirmative vote in the U.S. Congress.
In my statement opposing the Paulson Plan last month, I laid out two
primary reasons why I voted ‘no.' The first is that I wasn't convinced
that asset-purchase program was the right way to do this, and the
second is that it would lead to increased lobbying for handouts and
bailouts by any industry facing financial trouble.
I stated at the time that my vote was against the Paulson plan - not
against taking extraordinary action to provide necessary confidence to
financial markets. I stated that "The Paulson plan would have
Washington take $700 billion worth of toxic Wall Street assets from
financial firms' balance sheets and put them on the balance sheet of
the federal government.... I'm not confident in its success."
The critics were right. On October 14th, in a significant shift,
Treasury outlined a plan to directly purchase equity stakes in of major
financial institutions. The Wall Street Journal noted
that "critics...say Treasury should have formulated a comprehensive
plan earlier in the crisis." This past week, Secretary Paulson
announced that he has completed a remarkable about face, as summarized
by November 13th Investor's Business Daily front
page headline, which read, "In Major Reversal, Treasury Won't Buy Bad
Mortgage Debt." This is a complete reversal. Why did Paulson reverse
course? Thursday's Los Angeles Times provides the answer.
"Treasury Secretary Henry M. Paulson's decision to abandon plans to buy
troubled bank assets shows that he has come to two conclusions about
what was once the chief focus of the government's $700-billion bailout:
The first is that it wouldn't work."
I know many of you have serious concerns about how Secretary Paulson
has executed the financial rescue program and I share them with you.
Congress abdicated its Constitutional responsibility by signing a truly
blank check over to the Treasury Secretary. However, the lame duck
session of Congress offers us a tremendous opportunity to change
course. We should take it.
During the lame duck session, I will be taking the following actions.
First and foremost, if Secretary Paulson submits his plan to Congress
in order to access the remaining $350 billion while we are in session,
a doubtful prospect, I plan to immediately introduce the disapproval
resolution pursuant to Section 115 of the EESA and push for its
enactment. I will also introduce and actively pursue enactment of
legislation to do two things: First, it will amend Section 115 of the
Emergency Economic Stabilization Act of 2008 (EESA) to require an
affirmative vote on the part of Congress to approve Treasury's plan for
the remaining $350 billion, instead of the current statutory process
which gives Secretary Paulson far too much latitude. Second, it will
require a freeze on any remaining funds of the first $350 billion. It
is imperative that we not allow that amount of money to be added to a
deficit approaching $1 trillion this year without any input from the
legislative branch.
Secretary Paulson stated in a CNBC interview at 2:00pm on Friday, November 14th
that "the financial markets have been stabilized." If that is the case,
it is Congress's duty to have a say in what happens with the remaining
authorized amount of $350 billion. It is clear that it was a mistake to
sign a blank check to one man for such a tremendous amount of money.
Though there are still significant challenges in financial markets, it
appears that the threat of a catastrophic financial crisis, which was
the justification for the grant of such sweeping authority, has
subsided. Perhaps the additional $350 billion should not be added to
the deficit. Congress should have a debate.
I appreciate your time and attention to this matter and look forward to working with you in the coming week.
Sincerely,
Senator Jim Inhofe