Update on the Bailout: Hearing 11/14/08

Posted on November 18, 2008


Treasury Department Use of Bailout Funds


Watch the Hearing that took place Friday, November 14, 2008

*Transcript also available at the link.

Chaired by Dennis Kucinich

Treasury Dept. has been managing the Bailout Money. The key issue is how is the Treasury spending the Bailout Funds. It appears they are not helping homeowners, but buying Preferred Stock in banks instead. 350 billion has been spent and the next installment of 350 billion is due soon. The reason for the Hearing is to determine whether the Treasury should continue to be the manager of the fund as they have not followed through on the main section in the Emergency Economic Stabilization Act which is to prevent Homeowners from losing their homes.

We have heard about AIG giving 503 million in bonuses and providing Junkets for their constituents. AIG has received $154 Billion out of the Bailout Fund and rumor has it they are wanting more. Part of this hearing’s goal is to get the information as to why this is happening.

Senators and Representatives involved in questioning Neel Kashkari, Interim Assistant Secretary of the Treasury for Financial Stability were Dennis Kucinich, Rep. Darrell Issa, Rep. Elijah Cummings, Rep. Brian Bilbray. Neel Kashkari is Henry Paulson’s “right hand” guy.

More on who Neel Kashkari (don’t let this photo scare you): http://en.wikipedia.org/wiki/Neel_Kashkari

Henry Paulson, Secretary of Treasury http://en.wikipedia.org/wiki/Henry_Paulson announced on Wednesday that the Troubled Asset Relief Program would not buy mortgage assets. Instead Treasury would exclusively continue along the path of providing preferred equity injections to handpicked companies.

-From Dennis Kucinich: I think it’s fairly obvious that Congress would have never passed the Emergency Economic Stabilization Act had it known how Treasury would marshal the resources it was given.

It would be helpful to the members of Congress and to the next administration to understand the view points and assess the judgment of the current troubled Asset Releif Program leadership before deciding to entrust them the remainder of the Bailout Funds.

It would appear that Secretary Paulson has gutted Section 109 of the ACT

-From Brian Bilbray: Is the Adminstration ready to shift and go back now and tighten up the enforcement of the Rico Provision on who and where people get loans in this country? Are we willing to say that we want to make sure that people getting loans are actually legal in the system and have viable identification?

This Administration has specifically told lending institutions they do not have to follow a guideline every previous Administration has followed to stop racketeering. I think that has opened up a lot of problems. Now is the time that the American people want to go back and reform and change our operational motives.

Since 2005/2006 the Administration has not been enforcing the Rico Provision on who and where people get loans in this country.

-From Dennis Kucinich: By my calculation, out of the first $350 billion, $250 billion has already been spent or pledged. You have another 40 billion for AIG, another 60 billion for capital purchase of non-bank institutions.

-From Elijah Cummings: Mr. Kashkari, when I grew up in the inner-city of Baltimore, you wanted to make sure you were not a chump. That meant ther you did not want people to see you as somebody they could get over on. I’m just wondering how do you feel about AIG, giving $503 million worth of bonuses and excepting the $154 billion from hard-working taxpayers? I’m trying to make sure you get it. . .

There’s something wrong with this picture. Does that go through your head? We can’t afford to be chumps. People are hurting.

-LAST WORD From Dennis Kucinich: I don’t think anyone questions Mr. Kashkari that you are working hard. Our question is who are you working for?

There is a huge amount of information in the video of the proceedings. What is the basis of the Treasury not fulfilling their obligation attached to the approval of the Emergency Economic Stabilization bill? Let’s ASK the Questions!

PANEL 2: http://www.c-spanarchives.org/library/index.php?main_page=product_video_info&products_id=282411-2

. . . Next Hearing on this is Thursday