The Obama Administration's bailout of General Motors this week is one of the greatest power grabs by the federal government in forty years, but no one has asked where the White House got the authority to do it. GOP Senators Jim DeMint, Mike Johanns and Jeff Sessions asked those thorny questions on Wednesday at a press conference to "stop the nationalization." In an interview, Mr. DeMint told me: "When we voted for TARP, no one envisioned that this money would be used for buying up car companies." He blames then-Treasury Secretary Hank Paulson for seeking a blank check back in October during the height of the financial crisis. "No one knew how the money was to be spent. We gave the Treasury department a $100 billion line of credit forever," he complains.
For his part, Senator Sessions argued that the actions to nationalize GM were "illegal" and "extra-constitutional." All three noted that no Senate or House vote authorized Treasury's actions that in effect forced taxpayers to purchase 60% ownership in GM. "The first action we take as senators is to swear to uphold the Constitution," Mr. DeMint notes. "But the Constitution was never consulted here. It's amazing no one even asked the question, 'Where is the authority to do this?'"
Senate Republicans are especially concerned that when banks begin to repay their federal loans from last year, Treasury will end up getting a new slush fund to finance further acquisitions of assets. It's almost as if the feds are operating a venture capital firm inside the Treasury Department.
Senator Johanns plans to introduce an amendment to require Congressional approval for any release of TARP funds that would result in the government taking ownership stakes in private companies through common or preferred equity shares. He says: "Congress has a responsibility to provide oversight before a decision is made to allow the federal government to own portions of companies."
Usually this kind of funding for big projects has to go through the powerful appropriations committees in the House and Senate, but now the power of the purse has been commandeered by the executive branch. It isn't executing the laws, it's making the laws. "Why haven't the appropriators raised a stink and where is Senator Robert Byrd protecting Congress's power of the purse?" wonders DeMint spokesman Wesley Denton.
Good question. If a Republican president were asserting these imperial powers, you can bet Senator Byrd, that stickler for the separation of powers, would be howling all the way from West Virginia.
-- Stephen Moore
No comments:
Post a Comment