Contact: Matt Lahr

WALBERG WEEKLY WRAP-UP

Chelsea Coffee Hour

Share This Page Slashdot Del.icio.us Google Digg Reddit Newsvine Furl Yahoo Facebook

Washington, Oct 25 -
Examination Needed of AIG’s Spending Sprees
Recent news reports have surfaced that executives from AIG recklessly spent money shortly after the federal government bailed the giant insurance company out.

As you may recall, I opposed recent taxpayer bailouts of the financial sector, and I recently joined a delegation of members concerned about AIG’s reckless spending and sent a letter to Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke asking the two leaders to ensure taxpayer dollars were not used by AIG on these spending sprees.

I have strong concerns about AIG’s possible misuse of federal taxpayer funds. After the federal government provided a loan of $85 billion to AIG, AIG executives hosted a lavish $440,000 retreat at the St. Regis Resort in Monarch Beach, California. Even more troubling, the day after this was revealed to the House Oversight and Government Reform Committee, the New York branch of the Federal Reserve announced it will borrow $37.8 billion in investment-grade securities from AIG in exchange for cash.

At a time when many of my constituents have serious concerns about their own financial security, we must ensure that no taxpayer funds were used by AIG to host this retreat. If taxpayer funds were used, AIG should repay the American people in full. It is crucial that the American people be able to trust the actions of the Federal Reserve and the Treasury.

From the outset, I had deep reservations about the financial bailout bill. President Bush, Treasury Secretary Henry Paulson and a frenzied media climate eliminated the possibility of further debate to work on a deal that would protect taxpayers. During the debate about the bill, I stated that one of my principal reasons for not supporting the legislation was because the bill contained little oversight and was ripe for corruption.  I will continue to demand more taxpayer safeguards, more transparency and more accountability.

Nationwide Mortgage Fraud Task Force
One positive piece of legislation I supported before Congress adjourned in early October was the Nationwide Mortgage Fraud Task Force Act (H.R. 6853). This bi-partisan bill would establish a Nationwide Mortgage Fraud Task Force within the Federal Bureau of Investigation (FBI).  Specifically, the bill would establish regional branches in the ten states with the highest concentration of mortgage fraud, solicit participation from federal, state, and local law enforcement and prosecutors, organize initiatives to address mortgage fraud, collect and disseminate mortgage fraud data and establish a toll free mortgage fraud hotline.

Currently, there is no single federal agency in our government that monitors mortgage fraud. As we’ve seen in south-central Michigan, mortgage fraud is a real problem that needs to be addressed. It is my expectation that this bill will help crack down on those who have brazenly broken our rules and stop abuses in the mortgage lending industry.

We Must Protect Retirement Security For Seniors
It is critical that Congress preserves the solvency and promise of Social Security and Medicare. It is the least we can do for the millions of American seniors who have paid into these programs throughout their lifetime and are currently receiving benefits or scheduled to receive Social Security benefits. With record federal deficits and an ever growing national debt, we need to address the future solvency of Social Security.

Our country has made important commitments to programs like Social Security and Medicare that we must keep. Currently, the Social Security system is generating surplus tax revenues, but by 2017, it is expected to enter into a deficit. The benefits of retirees who will collect Social Security and Medicare are expected to grow by 76 percent while the number of workers paying into the system is expected to grow by only 6 percent.

I introduced the Social Security and Medicare Lock Box Act to help safeguard these funds for future retirees and help ensure accountability for our seniors, future retirees and children.  For the past 30 years, surplus Social Security dollars have been raided by Congress and spent on unrelated programs.  We need to lock away these funds to ensure our future retirees receive the promises that have been made to them.

Masking the general government fund deficit by borrowing from the Social Security and Medicare surpluses is wrong and only extends the future pain our nation will have to confront.  Congress should not be spending these Social Security and Medicare surpluses on questionable new programs and pork-barrel spending. We need to protect Social Security and Medicare for our parents and grandparents and ensure a safety net for future generations.