The Executive Compensation Double Standard

The Executive Compensation Double Standard

How is it that the Obama administration can go after executive bonuses from Wall Street banks yet continue to give millions of dollars of our hard earned money to the executives of the two giants now currently on taxpayer funded life support? Hmmm?

Ah, the double standard of Chicago politics…

Geithner’s Gift to America—Unlimited Liabilities for Taxpayers and $42 Million in Wall Street-Style Compensation for 12 Government Employees

“The economic miracle that has been the United States was not produced by socialized enterprises…It was produced by private enterprises in a profit-and-loss system.” –Milton Friedman

BACKGROUND:

On Christmas Eve, the Department of Treasury said that it would remove the $400 billion cap on Treasury’s funding of Fannie Mae and Freddie Mac, the two bankrupt government sponsored enterprises that Secretary Tim Geithner said were at the “epicenter” of the financial crisis. The move gives the failed GSEs unlimited taxpayer funded bailouts to cover losses incurred as a result of their managements’ recklessness and their boards of directors’ oversight failures. Geithner’s Treasury essentially turned the two failed GSEs into full government agencies and further exposes taxpayers to losses that the GSEs may incur in the future. The two GSEs are expected to report losses in the billions for 2009. Also on Christmas Eve, Fannie and Freddie disclosed that they received approval to pay $42 million in compensation packages to 12 top executives (all federal government employees and payable in cash) for 2009. Interestingly, the Democrats, led by Geithner and Rep. Barney Frank (D-MA), have launched an all out attack on capitalism by attempting to restrict the compensation of Wall Street firms they deem to be too profitable.

Fannie Mae and Freddie Mac are government created duopolies charged with providing liquidity to the mortgage market by purchasing mortgages from lenders and either holding those mortgages in their portfolios or packaging the loans into mortgage-backed securities that are sold to investors. Fannie and Freddie were privately held companies that generated big profits for their managements, boards of directors, and shareholders by being beneficiaries of advantages not shared by their competitors, including an implicit federal guarantee (i.e., a taxpayer bailout if the companies failed). Their managements and boards of directors, including former Freddie board member and current White House chief of staff Rahm Emanuel, are textbook examples of recklessness having put Fannie and Freddie in a position to cost taxpayers by chasing compensation targets and carrying out Democrat housing policies without concern for market risks. The taxpayers were left with two failed companies and potential liability of up to $400 billion as a result of the GSEs being put into conservatorship, but due to Geithner’s Christmas Eve spectacular, the taxpayers are now liable for all of Fannie’s and Freddie’s losses.

ISSUES OF CONCERN:

Arbitrarily Rewards Failure: Many would argue that failed firms that receive a taxpayer funded bailout and have not repaid the taxpayers should have their pay packages reviewed and, if necessary, limited until the firm makes a profit and the taxpayers are made whole. For example, the CEOs of failed firms, Citigroup, AIG, GM and Chrysler, should not and will not receive lavish compensation packages. However, the Democrats implemented an unlimited taxpayer funded bailout plan to indefinitely prop up Fannie and Freddie, and the CEOs of the government owned companies will receive millions of dollars in compensation even though the bankrupt companies are expected to report a loss for 2009. Geithner and acting-director of the Federal Housing Finance Agency, Edward DeMarco, should provide taxpayers the rationale for such decisions at Congressional oversight hearings immediately.

Wall Street-Style Compensation: As wards of the state with essentially no stock price, Fannie and Freddie have become government agencies. In fact, Rep. Barney Frank, one of main proponents of the policies that destroyed the housing market recently stated, “They’re not what they used to be-that inappropriately hybrid, private stock company, public policy instrument…They have become the public utility that finances housing in America to a great extent.” As government agencies, Fannie’s and Freddie’s employees are government employees. The president of the United States makes $400,000, but the CEOs of Fannie and Freddie are eligible to receive $6,000,000 each.

Creates Conditions for Another Financial Meltdown: The current financial turmoil was largely caused by the two GSEs. Peter Wallison, writing in the Wall Street Journal stated, “By the end of 2008, Fannie and Freddie held or guaranteed approximately 10 million subprime and Alt-A mortgages and mortgage-backed securities-risky loans with a total principal balance of $1.6 trillion. These are now defaulting at unprecedented rates, accounting for both their 2008 insolvency and their growing losses today. Since 2008, under government control, the two agencies have continued to buy dicey mortgages in order to stabilize housing prices.”

The pubs are correct. From the LATimes, and under the cover of the Xmas Eve health care vote.  Now why would we, as the people footing the bill, be giving bonuses to the men at the helm of failing government enterprises that control $5 Trillion in residential mortgage debt?  And one last note, remember Barney wants to abolish both these giants and start over with some sort of housing system.  Do you trust Barney Frank to come up with a capitalist, free-market based enterprise that isn’t going to collapse the system a few decades from now?

Fannie Mae, Freddie Mac CEOs could each earn $6 million a year

Michael Williams at Fannie and Charles E. Haldeman Jr. at Freddie will each receive a base salary of $900,000 in 2009 and 2010. They could get $5.1 million more if certain targets are met.

BAILOUTS

Reporting from Washington — The chief executives of Fannie Mae and Freddie Mac each could earn as much as $6 million this year and next, despite huge continued losses at the seized mortgage giants and a government bailout tab of more than $100 billion that the Obama administration said could rise even higher.

Fannie Mae Chief Executive Michael Williams will earn a base salary of $900,000 in 2009 and 2010, with a deferred base salary of $3.1 million each year to be paid “only if the enterprise meets performance metrics” set by its board and subject to government review, according to filings Thursday with the Securities and Exchange Commission. An additional $2 million is possible annually, identified as “target incentive opportunity.” Freddie Mac Chief Executive Charles E. Haldeman Jr. will get the same compensation package.

Four additional Fannie Mae executives will earn base salaries above $500,000 and have compensation packages for 2009 and 2010 that could pay each of them at least $2.7 million annually. One other Freddie Mac executive will receive a base salary over $500,000 and could earn as much as $1.15 million a year.

Also on Thursday, the administration said it was prepared to increase the maximum amount it would pay to bail out the troubled institutions

The announcements are likely to provoke outrage in Congress, particularly among Republicans, who have charged that Fannie Mae and Freddie Mac caused the housing boom and financial crisis with lax mortgage standards. Senators headed home for the holidays Thursday, and House members were already out of town, limiting the initial reaction.

“The Obama administration’s decision to write a blank check with taxpayer dollars for the continued bailout of Fannie Mae and Freddie Mac is appalling,” Rep. Scott Garrett (R-N.J.) said. “Not only is this a continued bailout of failed entities that need to be privatized to protect the taxpayer, the timing of the announcement is clearly designed to try and sneak the bailout by the taxpayers.”

The Treasury Department has pumped $60 billion into Fannie Mae and $51 billion into Freddie Mac in exchange for stock since federal officials seized them in September 2008 in one of the largest and most complex federal bailouts. Each company has a lifeline of as much as $200 billion, which administration officials said Thursday they would “increase as necessary” over the next three years as the companies continue to struggle.

The smell of corruption continues to get stronger.

Can We Impeach Him Yet?

Don’t Like The Outcome? Change The Rules

Don’t Like The Outcome? Change The Rules

via Michelle Malkin

Are you getting tired enough yet of the Democrats always changing the rules to suit their agenda and desired outcomes? What about all the changes in the Massachusetts special election laws so that Paul Kirk could be seated to replace Dead Kennedy?

Remember this?

What Ted Kennedy Wants

Senator Ted Kennedy, who is gravely ill with brain cancer, has sent a letter to Massachusetts lawmakers requesting a change in the state law that determines how his Senate seat would be filled if it became vacant before his eighth full term ends in 2012. Current law mandates that a special election be held at least 145 days after the seat becomes available. Mr. Kennedy is concerned that such a delay could leave his fellow Democrats in the Senate one vote short of a filibuster-proof majority for months while a special election takes place.

“I therefore am writing to urge you to work together to amend the law through the normal legislative process to provide for a temporary gubernatorial appointment until the special election occurs,” writes the Senator.

What Mr. Kennedy doesn’t volunteer is that he orchestrated the 2004 succession law revision that now requires a special election, and for similarly partisan reasons. John Kerry, the other Senator from the state, was running for President in 2004, and Mr. Kennedy wanted the law changed so the Republican Governor at the time, Mitt Romney, could not name Mr. Kerry’s replacement. “Prodded by a personal appeal from Senator Edward M. Kennedy,” reported the Boston Globe in 2004, “Democratic legislative leaders have agreed to take up a stalled bill creating a special election process to replace U.S. Senator John F. Kerry if he wins the presidency.” Now that the state has a Democratic Governor, Mr. Kennedy wants to revert to gubernatorial appointments.

Now that the Dems no longer have the supermajority in the Senate, Barney Frank floated the idea that the filibuster wasn’t created by God, and accordingly, the dems want to change rules again to fix their problem.

Whiners, losers…etc…
Filibuster reform bill headed for Senate floor, faces uphill battle

Sen. Tom Harkin (D-Iowa) intends to introduce legislation that would take away the minority’s power to filibuster legislation.

Sen. Tom Harkin (D-Iowa) intends in the next few weeks to introduce legislation that would take away the minority’s power to filibuster legislation.

Harkin has wanted to change the filibuster for years, but his move would come in the wake of Republican Scott Brown’s dramatic victory in Massachusetts. Brown’s victory cost Democrats their 60th vote in the Senate, and may have dealt a death blow to their hopes to move a massive healthcare overhaul. It could also limit President Barack Obama’s ability to move other pieces of his agenda forward.

Harkin believes senators in recent years have abused the procedural move.

Harkin’s bill would still allow senators to delay legislation, but ultimately would give the majority the power to move past a filibuster with a simple majority vote.

His staff said the bill would be introduced sometime before the Senate’s current work period ends on Feb. 13.

Iowa? Do you realize what is happening to the checks and balances in our government, and are you going to dump this asshat first chance?

Barney Frank Pushing To Abolish Fannie & Freddie

Barney Frank Pushing To Abolish Fannie & Freddie

I have been watching the market fall over 400 points this week because of steps that Obama and the socialist dems are taking in the District of Criminals with the bank limits.  Now Barney Frank is pushing to abolish Fannie and Freddie and replace it with something else; not quite sure what that’s going to be though.  That’s true leadership; once again talking about hope and change without a freakin’ plan.

I am assuming that the leftists are going to move toward that public utility idea that was floated earlier in the month.

Is anybody else besides me thinking that the guy that was involved in growing Fannie and Freddie to a point where they are threatening the nation’s stability should not be involved in creating something else to replace his mess?

“The companies now own or guarantee more than $5 trillion in U.S. residential debt, and were responsible for as much as 75 percent of the new mortgages made last year.”

Let that sink in for a minute….and Barney, and the Progressive Socialist Democratic congress are about to ‘do something’ about $5 TRILLION in U.S. Residential Debt. Breathe! Breathe!

Frank to Recommend Replacing Fannie Mae, Freddie Mac (Update3)

Jan. 22 (Bloomberg) — Representative Barney Frank, whose committee oversees Fannie Mae and Freddie Mac, said he will push to do away with the companies in favor of a different model for U.S. mortgage financing.

“The committee will be recommending abolishing Fannie Mae and Freddie Mac in their current form and coming up with a whole new system of housing finance,” Frank, a Massachusetts Democrat and chairman of the House Financial Services Committee, said at a hearing in Washington today. “That’s the approach, rather than a piecemeal one.”

The companies, the largest sources of money for U.S. home loans, were seized by regulators almost 17 months ago because of their risk of failing and have since survived on $110.6 billion in taxpayer-funded aid. Frank said Congress also needs to figure out what to do with the remaining shareholders in Fannie Mae and Freddie Mac as well as investors in the companies’ $5.4 trillion in mortgage bonds and $1.7 trillion in unsecured corporate debt.

“That will be one of the things we will be talking about,” Frank told reporters after the hearing. “The stockholders were of course already pretty much beaten up.”

The U.S. Treasury Department took an 80 percent equity stake in each company as part of the government’s September 2008 takeover, which wiped out the majority of common and preferred share values. Fannie Mae common shares, which peaked at $87.81 in December 2000, fell today 6 cents, or 5.6 percent, to $1.01 at 1:49 p.m. in New York Stock Exchange composite trading. Freddie Mac, which reached an all-time high of $73.70 in December 2004, dropped 9 cents, or 6.9 percent, to $1.22.

Housing Finance

Washington-based Fannie Mae, which dates back to the 1930s, and McLean, Virginia-based Freddie Mac, started in 1970, were chartered by the government primarily to lower the cost of homeownership. They buy mortgages from lenders, freeing up cash at banks to make more loans. They make money by financing mortgage-asset purchases with low-cost debt and on guarantees of home-loan securities they create out of loans from lenders.

The companies now own or guarantee more than $5 trillion in U.S. residential debt, and were responsible for as much as 75 percent of the new mortgages made last year.

Congress hasn’t made any decisions on how to restructure the U.S. home-loan market and will hold hearings before proposing any change, Frank said.

Market Function

“We’re going to look at the whole question of housing finance,” Frank said. “Sorting out the function of promoting liquidity in the market, and also the secondary market in general but then also doing some kind of subsidy for affordability.”

“I don’t know anybody who thinks Fannie and Freddie should continue,” he said.

Mortgage investors “shrugged off the news” today, said Nicholas Strand, a mortgage-bond analyst at Barclays Capital in New York. As Congress begins debating the issue in earnest this year, he said “you might see some concern by mortgage investors reflected in the pricing, but you’re not seeing that today.”

Fannie Mae and Freddie Mac have been run for more than 40 years as shareholder-owned companies that also have a federally chartered mission to promote the housing market. Those dual mandates have collided and contributed to the companies’ failure, Federal Deposit Insurance Corp. Chairman Sheila Bair said in a December interview.

Barney Frank, June, 2005:

How would the markets react?

Barney Frank Not Convinced Compensation Linked To Talent; Limit Bonuses

Barney Frank Not Convinced Compensation Linked To Talent; Limit Bonuses

The Progressive Socialist Democratic Party

In a prime example of a Progressive Socialist Democratic Party “I want my cake, and I want to eat it too” moment, Barney Frank is planning on hearings to limit Wall Street bonuses.  The “I want my cake” moment?  How does one implement a 90% tax on executive bonuses, proceed to limit them, and not understand that it is counterproductive? If the true intention of the tax “was the quickest way to show angry Americans that Congress intended to recoup the extra dollars”, then why limit them?  I know, I know, I’m not even covering the un-American, anti-Capitalist, anti-Free Market angle of this because we all know the democrats have gone off the marxist cliff, and are dragging us into third world, banana republic status with them.

Frank to hold Financial Services hearings on limiting executive pay

Rep. Barney Frank (D-Mass.) is mounting a new effort to limit executive compensation as Wall Street prepares this month to pay out huge bonuses.

Frank, chairman of the House Financial Services Committee, said he is looking at levying new taxes or fees on financial firms as well as ways to further empower shareholders to restrict pay.

“The question of compensation for people in the financial industry is a legitimate cause of concern,” Frank said on Wednesday.

Frank called a hearing for Jan. 22 and said he is not convinced by arguments that restrictions would hurt the industry by forcing well-paid employees to go elsewhere.

“I don’t know where people would go for comparable salaries,” he said, saying that they might need to go to Mars to escape.

“There may be in some of these financial institutions people capable of playing Major League Baseball. I’m not aware of any.”

The heads of the nation’s biggest banks were testifying on Wednesday before the Financial Crisis Inquiry Commission, a panel set up by Congress to investigate the causes and consequences of the financial crisis.

Meanwhile, the Obama administration is moving to impose a new fee on banks to make up the deficit in the government’s $700 billion bailout program for the industry.

WHAT?  How stupid is that? I swear the morons in Washington do not understand the finite concept. There is only so much money in the world (unless you are the Fed) and it is constantly in motion. When Obama fines the banks to recoup the money he took from us to bail them out, the banks charge us higher fees to pay us back for the money we loaned them. WHISKEY TANGO FOXTROT?  Is there an understanding NOW why so many were against the bailouts back in September, 2008?

Obama to announce bank fees to cover billions in TARP losses

The fee on financial institutions would raise up to $120 billion to ensure that taxpayers who bailed out banks are paid back, the official said Tuesday. The figure is at the upper end of a conservative estimate of losses associated with the program and Treasury officials expect the actual number will be much lower.

And in a completely related story; has anyone informed God that Barney is running the universe now? Barney’s first miracle will be to limit bonuses but still be able to tax the initial intended amount by the 90% tax rate and recoup the money that was lost on TARP.  The best financial talent in America will be able to pay the tax with money they never received and will continue to work here in the United States Of Socialist America.

(Has anyone told The Chosen One that Barney has leapfrogged him for the throne, and does the average secular moonbat know that there is a God and Barney has taken his seat?)
Barney Frank: Fannie & Freddie Are Kind Of A Public Utility

Barney Frank: Fannie & Freddie Are Kind Of A Public Utility

I know Barney’s statement comforts all of us and helps us to sleep at night in the knowledge that our government (being run by radical leftists) owns somewhere around 50% of the homes in the country.

Rep. Barney Frank: Lenders Fannie and Freddie now a ‘public policy instrument’

Mortgage giants Fannie Mae and Freddie Mac are now basically a “public policy instrument” of the government, Rep. Barney Frank (D-Mass.) suggested Tuesday.

Frank, the chairman of the House Financial Services Committee, asserted that the companies, which were taken over by the U.S. in September 2008, have become an extension of the government’s policy-making tools.

“Remember now that Fannie and Freddie have been converted,” Frank said during an appearance on CNBC. “Part of the losses of Fannie and Freddie are that since the housing collapse, Fannie Mae and Freddie Mac have become a kind of public utility.”

Frank made that claim in response to reports that the government may lose as much as $400 billion from its conservatorship of Fannie and Freddie, assistance that was made available when the home loan companies were put on the brink of collapse due to the subprime mortgage crisis.

Barney talks about the twins at 4:10.

Barney Frank’s Xmas Present To The Banks

Barney Frank’s Xmas Present To The Banks

When legislation coming from an entrenched Washington democrat is close to 1,300 pages, there are bound to be goodies inside.  Barney Frank is giving away trillions to the Wall Street Banks, and making sure that bailouts are definitely a event in the future should the poor bankers befall hard times again.

From Bloomberg and David Reilly:

Bankers Get $4 Trillion Gift From Barney Frank

Dec. 30 (Bloomberg) — To close out 2009, I decided to do something I bet no member of Congress has done — actually read from cover to cover one of the pieces of sweeping legislation bouncing around Capitol Hill.

Hunkering down by the fire, I snuggled up with H.R. 4173, the financial-reform legislation passed earlier this month by the House of Representatives. The Senate has yet to pass its own reform plan. The baby of Financial Services Committee Chairman Barney Frank, the House bill is meant to address everything from too-big-to-fail banks to asleep-at-the-switch credit-ratings companies to the protection of consumers from greedy lenders.

I quickly discovered why members of Congress rarely read legislation like this. At 1,279 pages, the “Wall Street Reform and Consumer Protection Act” is a real slog. And yes, I plowed through all those pages. (Memo to Chairman Frank: “ystem” at line 14, page 258 is missing the first “s”.)

The reading was especially painful since this reform sausage is stuffed with more gristle than meat. At least, that is, if you are a taxpayer hoping the bailout train is coming to a halt.

If you’re a banker, the bill is tastier. While banks opposed the legislation, they should cheer for its passage by the full Congress in the New Year: There are huge giveaways insuring the government will again rescue banks and Wall Street if the need arises.

Hit the link and read the rest.

Government Growth: IRS Hires Hundreds To Chase Wealthy

The only sector during the recession that is growing is the public sector.  How many caught this story yesterday in USA Today?

Average pay $30,000 over private sector

By Dennis Cauchon

USA TODAY

The number of federal workers earning six-figure salaries has exploded during the recession, according to a USA TODAY analysis of federal salary data.

Federal employees making salaries of $100,000 or more jumped from 14% to 19% of civil servants during the recession’s first 18 months — and that’s before overtime pay and bonuses are counted.

Federal workers are enjoying an extraordinary boom time — in pay and hiring — during a recession that has cost 7.3 million jobs in the private sector.

The highest-paid federal employees are doing best of all on salary increases. Defense Department civilian employees earning $150,000 or more increased from 1,868 in December 2007 to 10,100 in June 2009, the most recent figure available.

When the recession started, the Transportation Department had only one person earning a salary of $170,000 or more. Eighteen months later, 1,690 employees had salaries above $170,000.

Well it isn’t going to stop anytime soon, and now the IRS is getting into the groove since TurboTax Timmie, Barney and Company have made a priority of chasing down tax evaders who use offshore accounts.  The insanity of giving the IRS $387 million to chase down $13 Trillion in hidden offshore accounts instead of changing the tax code so that the wealthy would actually invest it in our economy is dazzling.  Add to that the brazen audacity of a tax cheat implementing this plan, and one has a recipe for expatriation.

IRS Hires Hundreds For New Wealth Unit

WASHINGTON (Reuters) – A new Internal Revenue Service unit set up to catch rich tax cheats hiding their wealth in complex business entities is rapidly taking shape with the hiring of hundreds of employees.

The IRS high wealth unit, part of a broader effort to combat international tax evasion, is focusing on “the entire web of business entities controlled by a high wealth individual,” IRS Commissioner Doug Shulman told a tax conference this week.

Another IRS official told Reuters “hundreds” of people have already been hired to staff the new unit, including some from within the agency.

“We have drawn top talent within the IRS that have expertise involving wealthy individuals as well as examination of their related entities,” said Mae Lew, an IRS special counsel.

The high-wealth unit is focusing on trusts, real estate investments, privately held companies and other business entities controlled by rich individuals.

While use of sophisticated legal structures can be legal, in other instances they “mask aggressive tax strategies,” Shulman said.

Tax authorities in Japan, Germany and the UK have also created similar units.

The U.S. House of Representatives on Thursday approved a $387 million boost for the IRS for the fiscal year that started October 1, in part to fund the high-wealth unit. The Senate is expected to vote on the measure on Sunday. (emphasis mine)

I think I may have mentioned the fact that these Sunday votes were going to become regular occurrences since the Democrats have to push through as much legislation as possible before we start firing them in 2010.

NEW GLOBAL FOCUS, JOINT CORPORATE AUDITS

The IRS is also opening new criminal offices in Beijing, Panama City and Sydney to focus on funds flowing out of Europe and into Asia, in part because of a heightened focus on international enforcement in Europe.

The goal is to get those up and running during this fiscal year, which ends September 30, according to Barry Shott, IRS deputy commissioner for international issues for large and midsized business.

At the center of the agency’s offshore effort is its legal cases against Swiss banking giant UBS AG. UBS agreed to turn over nearly 5,000 names of individual American clients and paid $780 million to settle a criminal case for aiding tax evasion.

Another Nail In America’s Coffin: Barney Frank’s Financial Reform Bill Passes

It is not like we did not see it coming.  We all knew that Barney’s 1,279 page POS was going to pass.  Now is the time to make sure that any semblance of this bill does not pass in the Senate with it’s additional layers of government, arbitrary decision making about companies’ health, and a seat at the table for community organizers like ACORN.

This bill is another 180 degree swinging pendulum away from logic or reality.  I am all for regulation and reform of the financial industry, but putting financial institutions in a straight jacket AND allowing community organizations who know nothing about creating small businesses, jobs, or wealth, a seat at the table is not going to help this economy.

House Passes Financial Overhaul Bill

WASHINGTON — The House has passed a sweeping overhaul of financial regulations that would govern Wall Street and reconfigure the power of the agencies overseeing the nation’s banking system. The vote was 223-202.

The legislation is a priority of President Barack Obama’s. It is designed to address the shortfalls that led to last year’s calamitous financial meltdown.

New powers would give the federal government the right to break up big risky companies. It also would create a consumer agency to police lenders.

Mr. Obama didn’t get everything he wanted. The legislation diluted some of his administration proposals. The legislative activity now moves to the Senate, which is not expected to act on a regulation bill until early next year.

Before the final vote Friday, House members rejected by a vote 223-208 an amendment that would have killed a proposed Consumer Financial Protection Agency. The agency would consolidate consumer lending regulations and enforcement that is now split among several banking regulators.

A bipartisan coalition had proposed keeping the consumer powers within each regulator and creating an oversight council. The U.S. Chamber of Commerce lobbied heavily to kill the agency and ran national television ads against it. Consumer groups said it was essential to the overall regulatory package.

In a separate vote Friday, Democratic leaders failed to revive legislation that would let bankruptcy judges rewrite mortgages to lower homeowners’ monthly payments. The measure was rejected by a 241-188 . (How did that happen?)

House Passes Far-Reaching Bill Tightening Financial Rules

The bill’s principal provisions establish a process for dismantling large, failing financial institutions; set up a council to identify and regulate firms that are so big, interconnected or risky that they need heightened supervision to keep them from bringing down the whole financial system; create a new consumer financial-protection agency to squelch unfair and abusive practices; and for the first time, regulate over-the-counter derivatives markets. The bill also contains provisions on executive pay, investor protection, credit ratings, hedge funds and insurance.

“How many new government agencies are necessary to accomplish this task?” asked Representative Dan Boren, Democrat of Oklahoma.

The argument in the House centered on the Democratic plan that would assess large financial companies a fee to create a $150 billion fund to cover the costs of dissolving companies that pose a threat to the economy. Democrats said the fund would not be used to keep companies afloat but would lead to a more orderly shutdown of businesses.

Republicans, trying to capitalize on public frustration with financial bailouts, said that failing firms should instead go through normal bankruptcy proceedings.

“If bankruptcy is good enough for American citizens, if it is good enough for small businesses, if it is good enough for 99.9 percent of American corporations, it ought to be good for the largest, ‘too-big-to-fail’ institutions,” Representative Spencer Bachus of Alabama, senior Republican on the Financial Services Committee, said.

Michele Bachmann On Barney Frank’s Financial Reform Legislation

I started reading the first draft of the financial regulatory reform legislation back at the end of October when it was 253 pages but it kept changing; first to 379 pages and now 1,279 pages. The latest draft was put out on the house floor a few days ago and guess what, they are voting on it today. Not very many people have been paying attention to the complete takeover of the financial sector by progressive democrats because everybody has been talking about the Senate health care bill. One needs to remember that whoever controls the purse strings, controls the world.

Michele Bachmann has called for Americans to melt the phone lines of their representatives in Washington over this sneaky legislation that gives control of the private sector to the White House. (202-224-3121).  This legislation also has the Waters amendment that gives community organizations (like ACORN) a seat at the table.  Barney and his cronies will tout this as a great bill because it contains the auditing of the Federal Reserve in it.  Go here to watch live streaming coverage of the vote on amendments and this bill.

A very small excerpt concerning an oversight council:

H.R.4173
The Wall Street Reform and Consumer Protection Act of 2009 (Introduced in House)

SEC. 1001. FINANCIAL SERVICES OVERSIGHT COUNCIL ESTABLISHED.

    (a) Establishment- Immediately upon enactment of this title, there is established a Financial Services Oversight Council.
    (b) Membership- The Council shall consist of the following:
    • (1) VOTING MEMBERS- Voting members, who shall each have one vote on the Council, as follows:
    • (A) The Secretary of the Treasury, who shall serve as the Chairman of the Council.
    • (B) The Chairman of the Board of Governors of the Federal Reserve System.
    • (C) The Comptroller of the Currency.
    • (D) The Director of the Office of Thrift Supervision, until the functions of the Director of the Office of Thrift Supervision are transferred to pursuant to subtitle C.
    • (E) The Chairman of the Securities and Exchange Commission.
    • (F) The Chairman of the Commodity Futures Trading Commission.
    • (G) The Chairperson of the Federal Deposit Insurance Corporation.
    • (H) The Director of the Federal Housing Finance Agency.
    • (I) The Chairman of the National Credit Union Administration.
    • (2) NONVOTING MEMBERS- Nonvoting members, who shall serve in an advisory capacity:
    • (A) A State insurance commissioner, to be designated by a selection process determined by the State insurance commissioners, provided that the term for which a State insurance commissioner may serve shall last no more than the 2-year period beginning on the date that the commissioner is selected.
    • (B) A State banking supervisor, to be designated by a selection process determined by the State bank supervisors, provided that the term for which a State banking supervisor may serve shall last no more than the 2-year period beginning on the date that the supervisor is selected.
    (c) Duties- The Council shall have the following duties:
    • (1) To advise the Congress on financial domestic and international regulatory developments, including insurance and accounting developments, and make recommendations that will enhance the integrity, efficiency, orderliness, competitiveness, and stability of the United States financial markets.
    • (2) To monitor the financial services marketplace to identify potential threats to the stability of the United States financial system.
    • (3) To identify potential threats to the stability of the United States financial system that do not arise out of the financial services marketplace.
    • (4) To develop plans (and conduct exercises in furtherance of those plans) to prepare for potential threats identified under paragraphs (2) and (3).
    • (5) To subject financial companies and financial activities to stricter prudential standards in order to promote financial stability and mitigate systemic risk in accordance with subtitle B.

Bad Behavior has blocked 2215 access attempts in the last 7 days.

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