Crimes Against Liberty Read online

  Gerald Walpin was not the only government watchdog that got crossways with President Obama. Neil Barofsky, the special inspector general for the $700 billion TARP program, also ended up in a dispute with Obama’s Treasury Department. According to the Los Angeles Times, the Treasury Department claimed Barofsky’s role as “Sigtarp” was not completely independent from Treasury. There was a “dispute over certain Treasury documents” being withheld from Barofsky by Treasury, over what Senator Charles Grassley called a “specious claim of attorney-client privilege.”

  When he was appointed, Barofsky was praised for his credentials, being a former prosecutor who would rigorously protect the taxpayer’s interest in the bailout funds. But it appears Treasury was withholding information from Barofksy, prompting him to write a memo defending the independence of his position and disputing that attorney-client privilege was a legitimate bar to information he was requesting from Treasury. 32 Grassley observed, “The grassroots is furious about the way TARP dollars have been used and what looks like a lack of accountability for this massive infusion of tax dollars. It’s added injury to hear about the Treasury Department putting up hurdles to slow down the work of the watchdog who’s supposed to track the money. One of the biggest lessons of the last year is that the public deserves more transparency and, in turn, accountability from New York and Washington.”33 Treasury officials said Sigtarp fell under their domain and sought an opinion from the Justice Department’s Office of Legal Counsel.34

  Eventually Treasury backed down. Barofsky, in a letter to Congress, reported that Treasury had withdrawn an earlier request to the Justice Department seeking a legal opinion on the degree of Sigtarp’s independence. Barofksy said, “We view such withdrawal as Treasury’s acknowledgment that Sigtarp is an independent entity within Treasury, and that my office and I are not subject to the supervision of the secretary.” He referred to the now-ended dispute as “this needless distraction.” The episode led Congressman Issa to argue the incident reflected the “arrogance” of Treasury officials “who are wielding immense power over our economy.” While Sigtarp was technically a part of the Treasury Department, there was little genuine legal question as to his access to Treasury documents. Congress, in establishing the office, set clear directives that gave him broad access and placed the burden on Treasury secretary Giethner to explain why he would refuse to follow any of Sigtarp’s recommendations.

  Secrecy, stonewalling, and spurious claims of executive privilege have become the hallmarks of the Obama administration. Notwithstanding his campaign vows to “restore” openness and transparency to the presidency, Obama has treated the office almost as his personal fiefdom, running roughshod over Congress and willfully ignoring vital checks on his authority.

  Gerald Walpin’s firing was just one of many such examples, but it has already set a dangerous precedent. Less than a month and a half after Obama fired Walpin, congressional Democrats proposed to give Obama the power to appoint inspectors general at five financial regulatory agencies, a move that could greatly compromise the independent oversight of portions of the federal bureaucracy. The Washington Times editors warned this move “would only serve to further politicize these positions”: the Federal Reserve, Commodity Futures Trading Commission, National Credit Union Administration, Securities and Exchange Commission, and Pension Benefit Guaranty Corp. Supporters of the move argued, deceitfully, that the IGs’ independence would not be undermined because they would not be investigating the president personally. But with Obama’s governmental powers growing every day, this was not the time to be reducing checks and balances against abuses.35

  Furthermore, in June 2010 a federal judge dismissed Walpin’s wrongful termination lawsuit—incredibly, the judge upheld the administration’s bogus claim that Obama did not technically fire Walpin when Obama removed his authority and placed him on “administrative leave.” As Byron York noted, the decision “means the president can remove future inspectors general immediately, without reason or notice to Congress, simply by placing an inspector general on immediate administrative leave.... The inspector general would be out of his office immediately, stripped of his authority, and the president could claim that he had not actually been fired, and thus the law had not been violated.”36

  In the end, although Obama made room in his administration for everyone from the former Communist Van Jones to the environmental extremist Steven Chu, he could not tolerate the presence of an aggressive watchdog of government malfeasance.

  PART III

  OFFENSES AGAINST AMERICA’S GENERAL WELFARE AND NATIONAL SECURITY

  Chapter Twelve

  TAXING AND SPENDING AMERICA INTO BANKRUPTCY

  CRIMES AGAINST OUR POSTERITY

  It was ironic that during the very week that Obama was, once more, cynically urging a “bipartisan” effort to control our soaring deficits, a survey of economists revealed their belief that Obama’s vaunted stimulus package had not contributed much toward an economic recovery. This “stimulus,” which hemorrhaged borrowed money to prime the economy’s pump, accomplished little more than political payoffs, expanding the public sector, and proving the government was still the king of colossal waste.

  The quarterly survey by the National Association for Business Economics polled sixty-eight of its members who work in economic roles at private-sector firms. About 73 percent of them said employment at their companies was neither higher nor lower as a result of the stimulus act. Backing up their assessment were the hard facts that millions of jobs have been lost since the stimulus bill was passed, and that Obama himself had implicitly admitted its failure when he convened his “Jobs Summit” as a prelude to passing his $17.7 billion jobs bill.1 The same week economic experts inside the Health and Human Services Department confessed that contrary to Obama’s claim, ObamaCare would increase healthcare costs.2

  As if an innocent bystander observing our exploding national debt, Obama piously warned against the deficits that threaten to erode America’s standard of living as he addressed members of the “bipartisan” National Commission on Fiscal Responsibility and Reform. Later he would similarly show his limitless gall in presuming to give Germany’s Chancellor Angela Merkel economic advice—that “Europe needed to try something big,” implying his own “big” actions had restored America’s economy.3 Then, at the G-20 conference in Toronto in June 2010, when other nations were focusing on deficit reduction, Obama urged them to continue reckless deficit spending. Even the Washington Post recognized that Obama’s remarks “tempered the Group of 20’s headline achievement at the summit, a deficit-reduction target that had been pushed by Canadian Prime Minister Stephen Harper, the host of the meeting and a fiscal conservative.”4

  These remarks came from the same guy who refused to let TARP CEOs pay down their debts; who planned a systematic expansion of our national deficits and debt in order to “spread the wealth around” and shore up his reelection efforts; who wasted billions in the stimulus package and the auto bailouts; who was hell-bent on passing the bankrupting cap and trade bill and the financial overhaul debacle; and who rammed through Cash for Clunkers, the mortgage bailout bill, and ObamaCare. It was becoming cartoonish—in a tragic sort of way.

  Obama is the guy who arranged for the U.S. to contribute billions of dollars to an international bailout of Greece over the objections of Congress at a time when we were undergoing the most severe debt crisis in our history. As critics noted, just as with Obama’s various domestic bailout schemes, this would encourage other European countries in financial straits to request even larger bailouts from the United States. Calling the bailout “absurd,” Newt Gingrich rightly asked, “Why should the American taxpayer put up 14 percent of the money, billions and billions of dollars, to bail out a Greek government . . . [that] has terrible work rules, has massive corruption, [and] has government employees rioting in the streets over the idea that they’re going to lose anything? The Greeks are telling us that they don’t want to take care of themselves but they don�
��t mind us sending them more money. I think that’s just fundamentally wrong.”5

  But when it comes to proposed bailouts, there is no satiating Democratic appetites. Democratic senator Bob Casey has introduced legislation to bail out troubled union pension funds to the tune of $165 billion—which would be just the beginning. Obama’s manipulation of the Chrysler and GM restructurings to benefit the unions was apparently not enough payback for their tireless work in getting Democrats elected and promoting their agenda.

  STIMULUS

  Vowing to “jump start the economy,” Obama unleashed on America his stimulus bill—The American Recovery and Reinvestment Act. He claimed it would cost $787 billion—on the heels of the $700 billion TARP bailout program. Even casual students of government knew it would cost more than promised. Less than a year later, the Congressional Budget Office upped its estimate to $862 billion, though some said that with interest the bill would cost $1.3 trillion. The greatest factor contributing to CBO’s miscalculation was its assumption that unemployment would not exceed 9 percent. After all, Obama promised his stimulus would keep unemployment from surpassing 8 percent, but joblessness rose above 10 percent in October and thereafter hovered between 9 and 10 percent. With unemployment numbers dwarfing Obama’s predictions, unemployment compensation costs soared far above CBO’s estimates.6

  Although the bill was pitched as a way to stimulate the economy and create jobs, it was actually a disgraceful boondoggle full of waste, pork, political payoffs, temporary green jobs, and other programs designed to further expand government. Obama and his Democratic allies stuffed years’ worth of their legislative wish lists into this monstrous vehicle, exploiting the economic crisis to covertly enact legislation as sweeping as reversing the successful welfare reforms of the 1990s.

  But even a committed Keynesian would be hard-pressed to describe the stimulus as primarily designed to stimulate. If the only way out of the economic crisis were to infuse nearly a trillion dollars into the economy, then why did Obama intentionally hold back such a great portion of the funds for expenditure in later years? Why did he recklessly waste so much of the money on programs and initiatives that couldn’t conceivably have been expected to stimulate anything, other than liberal euphoria over long-awaited spending on their pet projects and Democratic reelection efforts?

  In early February 2009, Republicans published a list of some of the wasteful items in the bill. Among the items:• $2 billion for FutureGen, a near-zero emissions coal power plant in Illinois from which the Department of Energy pulled funding in 2009 after determining the project was inefficient.

  • A $246 million tax break for Hollywood movie producers to buy motion picture film.

  • $88 million for the Coast Guard to design a new polar icebreaker ship.

  • $448 million for constructing the Department of Homeland Security headquarters and $248 million for the building’s furniture.

  • $600 million to buy hybrid vehicles for federal employees.

  • $400 million for the Centers for Disease Control to screen and prevent STDs.

  • $1.4 billion for rural waste disposal programs.

  • $125 million for the Washington sewer system.

  • $150 million for the Smithsonian museum facilities.

  • $1 billion for the 2010 Census, which has a projected cost overrun of $3 billion.

  • $75 million for “smoking cessation activities.”

  • $200 million for public computer centers at community colleges.

  • $75 million for salaries of FBI employees.

  • $25 million for tribal alcohol and substance abuse reduction.

  • $500 million for flood reduction projects on the Mississippi River.

  • $10 million to inspect canals in urban areas.

  • $6 billion to turn federal buildings into “green buildings.”

  • $500 million for state and local fire stations.

  • $650 million for wildland fire management on forest service lands.

  • $1.2 billion for “youth activities,” including youth summer job programs.

  • $88 million for renovating the headquarters of the Public Health Service.

  • $412 million for CDC buildings and property.

  • $500 million for building and repairing National Institutes of Health facilities in Bethesda, Maryland.

  • $160 million for “paid volunteers” at the Corporation for National and Community Service.

  • $5.5 million for “energy efficiency initiatives” at the Department of Veterans Affairs National Cemetery Administration.

  • $850 million for Amtrak.

  • $100 million for reducing the hazard of lead-based paint.

  • $75 million to construct a “security training” facility for State Department security officers (who can actually be trained at existing facilities of other agencies).

  • $110 million to upgrade computer systems at the Farm Service Agency.

  • $200 million to lease alternative energy vehicles for use on military installations.7

  Is it any wonder this bill was immediately dubbed “Porkulus?” This list illustrates so much of what’s wrong with socialism and expanding government into areas never contemplated by the framers of our Constitution. If you submitted this list to the people and itemized how much each taxpayer’s share would be, few items would be approved.

  There’s also a lot of politically correct environmentalism and make-work projects that are obscenely wasteful, especially on the heels of the similarly extravagant TARP bill. This legislative act was unconscionable, considering that it was largely funded by exacerbating our growing debt problem. That the bill passed both chambers of Congress is a testament to how far Democrats will go if possessed, albeit temporarily, of virtually unchecked power.

  The stimulus proved to be disorganized, out of control, and beyond the ability of government to account for, despite promises from Obama and Biden that they would vigilantly monitor the money.8 The federal government’s Recovery.org website, which is supposed to have tracked the expenditures, listed some $9.5 million in stimulus money as going to fourteen zip codes in Virginia that did not exist or are in other states, according to Old Dominion Watchdog. 9 New Mexico Watchdog discovered $27 million of federal money went to nonexistent zip codes in New Mexico.10 In addition to these disgraceful developments, the Atlanta Journal-Constitution reported that the stimulus delivered some $2.2 billion in tuition grants to massage and beauty schools, online universities, and other for-profit colleges in Georgia and across the nation.11

  As detailed in chapter three, the stimulus did not cause a jobs spurt, but an enormous job loss. A Bureau of Labor statistics chart shows, state by state, that through December 2009, 3,179,328 jobs were lost—while the administration claims 638,825 jobs were “created or saved.” Veronique de Rugy, a senior research fellow at the Mercatus Center at George Mason University, notes this means that for every job “created or saved”—a concept she mocks as “a completely fictitious and unverifiable metric”—six jobs were lost as shown in this chart:

  Impact of the Stimulus Jobs toss Dominates Job Creation

  Source: Bureau of Labour Statistics, Recovery.gov

  Of the few jobs that were actually created, most were in the public sector, contradicting another administration claim. De Rugy said data from Stimulus Watch revealed only 140,765 of the 638,825 jobs the administration claimed to have created or saved with stimulus funds were private sector jobs. To the extent the stimulus was stimulating anything, it was government—the last thing we need. Going from bad to worse, the Bureau of Labor Statistics reported that since the stimulus bill was passed, the private sector had suffered a net loss of 2,610,000 employees, while the government had only lost 46,000 employees. The number of private jobs lost compared to private jobs created is “far greater than 6.” Dr Rugy concluded that since the CBO had recently admitted it was “impossible to determine how many of the reported jobs would have existed” without the stimu
lus, “it seems clear that for the sake of taxpayers and for the sake of job creation, a second stimulus is absolutely the wrong idea.”12 Yet such common sense didn’t deter Obama and Congress, which passed the second stimulus bill, offensively called the “Jobs Bill,” on March 17, 2010.13

  Moreover, the pathetic results of Obama’s stimulus also did not prevent Vice President Joe Biden from declaring the stimulus an “absolute success.” Nor did it keep Obama from deceitfully boasting in a speech in Wisconsin in June 2010 that without his stimulus the economy would have been much worse—an argument that is at odds with the evidence and, at any rate, is impossible to conclusively prove. He also declared, “Every economist who’s looked at it has said that the [stimulus] did its job.” That’s quite an interesting claim in light of the Heritage Foundation’s statement earlier that month that “for objective observers the failure of President Obama’s $862 billion stimulus package has become increasingly difficult to deny.”14

  EXPLODING DEFICITS AND NATIONAL DEBT

  It appears that the only thing the stimulus bill created—other than public sector jobs—was astronomical federal debt. Indeed, the ultimate scandal of the Obama administration—and this is a tough call, given ObamaCare as well as Obama’s virtual surrender in the war on terror—is its exponential growth of the national debt to unsustainable levels that put the nation on a path to bankruptcy. One would have expected that after the extraordinary TARP expenditures, prudent politicians would have pulled the reins in for the sake of the nation’s fiscal stability. But Obama did the opposite with his myriad indulgent initiatives, as listed above. He never intended to pull back government spending, but obviously planned on perpetuating the economic crisis and milking it to redistribute every dollar he could from certain citizens and companies to others. While mouthing phony bromides about fiscal stewardship, he is continuing to spend at a breakneck pace, with the apparent strategy to get us into such debt that our only way out will be to increase taxes, possibly even enacting a Value Added Tax (VAT), as noted in chapter three.