By Iowa Congressman Tom Latham
Iowa’s 4th Congressional District
American taxpayers are once again being played for fools on Capitol Hill as the president and members of Congress shed crocodile tears and gnash their teeth over the fact that American International Group (AIG) used part of its $170 billion grant from the Troubled Assets Relief Program (TARP) for hefty employee bonuses.
As you know, the TARP was created last fall and is often referred to as the Wall Street bailout. For those of us in Congress who voted against creating the Wall Street bailout-TARP mess, this theater of the absurd is playing just as we had predicted last fall.
The executive bonuses are an insult to taxpayers, but we can’t lose sight of how AIG got its hands on the taxpayers’ wallets in the first place. The American people can pin the blame on the Washington politicians who ignored taxpayer demands for accountability and voted in favor of the Wall Street bailout plan last October.
I voted against the Wall Street bailout each of the three times it came before the U.S. House of Representatives, and I spoke out against the inherent risk in propping up financial institutions that were crumbling under the weight of their own irresponsibility. In my official statements last fall, I noted that the $700 billion bailout granted largely unchecked power to one person to spend that money. At the time, it was Treasury Secretary Henry Paulson. Now, President Obama’s Treasury Secretary, Timothy Geithner, exercises that no-strings-attached authority. But most egregiously, the bailout bill lacked any guarantees for success, and it contained no measures to close the taxpayers’ checkbook if the plan failed.
Some have criticized my vote against the Wall Street bailout, and much of that criticism has come from those very same members of Congress who supported it last fall but this past week have loudly decried executive bonuses. These critics are now learning why some of us fought so vehemently against the Wall Street bailout – TARP scheme in the first place: the legislation approved by Congress in October lacked any restraint or control to protect the American taxpayer.
I faced similar criticism for my opposition to the $787 billion stimulus package approved in February of this year, and I worry that we may be in for even more embarrassing stories as the American people find that the stimulus legislation shares the same shortcomings as the bailout legislation. Just like the Wall Street bailout, the stimulus package comes with a huge price tag but contains little in the way of taxpayer accountability or oversight. I voted against both bills for similar reasons, and I suspect both will end with more stories of massive waste and uncertainty.
I stand shoulder-to-shoulder with the millions of Americans who are demanding accountability in how their taxes are spent. We can’t send a message to failed Wall Street executives that the American people will always be there to save them when they’re faced with tough decisions.
Likewise, we must remind Washington and Congress that it breaks faith with the American people when we fail to work toward solutions based on sound economic principles that address the real needs of America. These are the principles on which our nation was founded, and these are the principles that we have a duty to protect. It’s time we put the American taxpayer first.
To listen to an mp3 of Congressman Latham answering questions on this issue, please visit CLICK HERE.
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