No Runny Eggs

The repository of one hard-boiled egg from the south suburbs of Milwaukee, Wisconsin (and the occassional guest-blogger). The ramblings within may or may not offend, shock and awe you, but they are what I (or my guest-bloggers) think.

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Monday Hot Read – Jon Ward’s “Paul Ryan explains his votes for TARP, bailouts and tax on AIG bonuses”

by @ 9:20 on February 15, 2010. Tags:
Filed under Politics - National.

Last week, Matt Lewis hit Paul Ryan on a trio of “not exactly” fiscally/small-government conservative votes at the end of the previous and the start of the current Congress. Jon Ward asked Ryan directly about each of the three votes (quotes from Ryan, with interjections from me breaking up the blockquotes):

You know I don’t hear it here at home that much. You’ve got to remember Obama won my district. Dukakis and Gore won my district. Clinton won my district. So I don’t come from, you know, a red area. So I think it’s important to keep in mind where I come from. I don’t hear that here.

It may not exactly be “that much”, but I will verify that Ryan has heard it from the district (specifically me). I will point out that before Mark Neumann finally broke through in 1994 (after failing miserably in 1992 and narrowly losing in a special election in 1993) and before Ryan made it a “safe R” district, the district was a very-safe Democratic district represented for years by Les Aspen.

TARP. I’ll take one at a time. I believe we were on the cusp of a deflationary spiral which would have created a Depression. I think that’s probably pretty likely. If we would have allowed that to happen, I think we would have had a big government agenda sweeping through this country so fast that we wouldn’t have recovered from it. So in order to prevent a Depression and a complete evisceration of the free market system we have, I think it was necessary. It wasn’t a fun vote. You don’t get to choose the kind of votes you want. But I just think as far as the long term objectives that I have — which are restoring the principles of this country — I think it was necessary to prevent those principles from being really kind of wiped out for a generation.

I know a lot of people don’t like to hear it (especially those with short memories), but support for/opposition against TARP, at least in its originally-conceived form of being a very-temporary holding of real assets that could not be dumped on the open market without the open market crashing, was a far closer call than the 20/10 vision of history made it.

Auto. Really clear. The president’s chief of staff [Josh Bolten] made it extremely clear to me before the vote, which is either the auto companies get the money that was put in the Energy Department for them already — a bill that I voted against because I didn’t want to give them that money, which was only within the $25 billion, money that was already expended but not obligated — or the president was going to give them TARP, with no limit. That’s what they told me. That’s what the president’s chief of staff explained to me. I said, ‘Well, I don’t want them to get TARP. We want to keep TARP on a [inaudible]. We don’t want to expand it. So give them that Energy Department money that at least puts them out of TARP, and is limited.’ Well, where are we now? What I feared would happen did happen. The bill failed, and now they’ve got $87 billion from TARP, money we’re not going to get back. And now TARP, as a precedent established by the Bush administration, whereby the Obama administration now has turned this thing into its latest slush fund. And so I voted for that to prevent precisely what has happened, which I feared would happen.

It’s a question of semantics here. Does one see that particular vote (which died in the Senate) as a “limit the damage” attempt or an opportunity to stand in complete opposition? Do remember that, at the time, Ryan’s hometown was home to a GM truck assembly plant, and that Chrysler had an engine plant in the district.

Would “limiting” the cash available for that bailout to $25 billion stopped the government takeover of GM and Chrysler? I don’t know. However, it would have prevented the Treasury from providing the debtor-in-possesion financing that greased the nationalization skids.

The whole AIG thing, you know that was — you know I obviously regret that one. I was angry at the time because I was worried that all these companies were jumping into TARP thinking they could use TARP as a way to best their competitors, as a way to get cheaper credit, to get money at cheaper rates, at the expense of their smaller competitors. And so I was seeing TARP as sort of a new tool of crony capitalism, and I thought it’d be a good signal to send to the large banks who were jumping into this thing, who really didn’t need it: ‘Stay away from this, don’t get in bed with the government, even though it might in the short term give you a leg up on your competitors, you’ll be burned. That was what was running through my mind at the time, given the fact that we had about six hours notice on the vote, and our lawyers were telling us that it was not a bill of attainder. Now when a week went by, and our lawyers had a chance to read it more clearly and carefully, they reversed their opinion of the bill and said it was in fact a bill of attainder, which therefore should not have passed…. The other thing that bothered me was the Democrats were in a real political pinch, because Chris Dodd wrote in the exemption for those bonuses in the bill, and they were on the hook for it. And they were trying to get themselves off the hook and Republicans on the hook. And that bothered me too, was just the political cynicism behind it bothered me and I didn’t want to give the Democrats that as well. So those were the thoughts running through my mind when I had to make more or less the snap judgment on that bill.

The “don’t get in bed” portion of that was the off-the-record answer I alluded to last week (which, going back through the archives, was not exactly off-the-record). The fact that Ryan admitted he made a mistake is new, and refreshing.

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