H.R. 1207 – The Federal Reserve Transparency Act

While the country is enraged over the $160 million that AIG gave its executives, the Federal Reserve, a privately owned institution, has announced that it will be buying up $1.25 trillion of U.S. treasuries and Fannie and Freddie debt.  This is money that will simply be created and put into the economy.  Often times the American government isn’t even aware of what the Fed actually does and what is on their balance sheet, or how much money they create.  With a fiat currency system in place, the last thing we need is a currency crisis.

The Fed is required to answer to no one, and few people even think to question them.  H.R. 1207 is a first step in regaining control over our currency by requiring an audit of the Fed and bringing their actions to light.

The bill currently has 33 cosponsors (none from Nebraska) and has been referred to the House Committee on Financial Services.  Please contact your representative to support this bill!

H.R. 1586 – The AIG bonuses

Lately, news outlets have been rambling about AIG handing out millions of dollars in (contractually obligated) bonus money which was acquired through TARP funds.  On Thursday the House passed its solution: H.R. 1586, which would impose a 90% income tax on all such bonus money over $250,000.

This brings up several issues to consider:

1. Is this a bill of attainder?  It is explicitely prohibited in the constitution to use legislation to target or punish individuals, or a particular group of people.  Many consider this bill to be unconstitutional, although the FISA bill was ex post facto, and that didn’t stop anybody.
2. Congress voted to give the Treasury Secretary control over the TARP funds without any checks or balances.  Had congress simply let AIG file bankruptcy, we wouldn’t be having this discussion.
3. Congress is exercising more control over the inner workings of financial institutions through this legislation.  History has shown that unintended consequences often result from government interference; e.g., limiting the pay of CEO’s of financial companies, which will send the best talent to the companies that weren’t bailed out and have no such restrictions.
4. AIG could simply raise bonuses by 10 times to compensate for the tax.  Congress has already proven their determination to not let them go bankrupt, so they have less incentive to make wise business decisions since the federal government is willing to absorb the losses.

Most concerning is #1, the constitutionality of this bill and Congress going beyond their legal authority.  This sets a scary precedent for what Congress may be able to do in the future by targeting other groups for whatever reason they feel.

Representatives Lee Terry and Adrian Smith opossed this bill, but Rep. Jeff Fortenberry voted in favor of it.

The GIVE Act

It’s been pretty quiet on this blog lately, but that doesn’t mean our representatives haven’t been hard at work in the House.  As today has shown, it is important that we always stay vigilant on the bills being considered and let our reps know what we think.

First off today was H.R. 1388, the Generations Invigorating Volunteerism and Education (GIVE) Act, which passed 321-105.  This act bolsters current federal civil service programs to try to increase volunteerism from elementary students all the way to senior citizens.  Included in this is special funding for schools that implement “service-learning programs” in their curriculum.

A very disturbing thing about this act is a piece at the end which forms the Congressional Commission on Civic Service, which shall address and analyze, among other things:

“(5) The effect on the Nation, on those who serve, and on the families of those who serve, if all individuals in the United States were expected to perform national service or were required to perform a certain amount of national service.

(6) Whether a workable, fair, and reasonable mandatory service requirement for all able young people could be developed, and how such a requirement could be implemented in a manner that would strengthen the social fabric of the Nation and overcome civic challenges by bringing together people from diverse economic, ethnic, and educational backgrounds.

(7) The need for a public service academy, a 4-year institution that offers a federally funded undergraduate education with a focus on training future public sector leaders.

(8) The means to develop awareness of national service and volunteer opportunities at a young age by creating, expanding, and promoting service options for elementary and secondary school students, through service learning or other means, and by raising awareness of existing incentives.

(9) The effectiveness of establishing a training program on college campuses to recruit and educate college students for national service.”

While I feel volunteerism is a good thing, I question the involvement of government, particularly in the school system, which in effect makes it no longer voluntary for students in schools who choose to participate.  Secondly, this is opening doors and paving a way toward a mandatory service in the future, which might prove difficult as long as we remember the 13th amendment:

“Neither slavery nor involuntary servitude, except as a punishment for crime where of the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.”

Representatives Lee Terry and Jeff Fortenberry supported this bill, while Rep. Adrian Smith opposed.

Nebraska Representatives Vote Against Auto Bailout

The House voted to approve H.R 7321 (“The Federal Auto Loan Bill”) today.  Thankfully, Nebraska’s three members of the House voted no.  Thank you Congressmen Fortenberry, Terry and Smith.  Nebraska’s citizens who love liberty appreciate your vote!

Up and Coming

After January 1, we will be trying to keep an eye on what’s happening in the U.S. House of Representatives, and what Nebraska’s three Representatives are up to.