Senate Should Reject Dodd-Frank Financial Bailout

A group of over two dozen prominent conservatives led by former Atty. Gen. Ed Meese and operating under the umbrella of the Conservative Action Project has issued a highly critical analysis of the Dodd-Frank financial bailout legislation, saying it would increase the size and scope of the federal government, regulating every phase of economic activity.

Here is the case against the measure.

Rep. Tom Price (R.-Ga.):  “As a physician, I fought tirelessly against the Democrats’ government takeover of healthcare because it will do irreparable harm to Americans’ access to quality, affordable healthcare. Tragically, the Dodd-Frank permanent bailout proposal will deliver a far more formidable blow to American families and main street entrepreneurs.  With Dodd-Frank, the Democrats have set out to reorder America’s entire economic system and sever ties with the free-market principles that have guided our nation to unprecedented prosperity.”

The financial reform legislation(also known as Dodd-Frank), agreed to by House and Senate Democrats in a conference committee and then passed by the House of Representatives, not only takes away the freedom of a large Wall Street firm to fail, it also takes away Main Street’s freedom to succeed.  The legislation would increase the size and scope of the federal government, regulating every phase of economic activity.  The legislation would also make permanent taxpayer-funded bailouts of large Wall Street firms. Due to the bill’s excessive taxes and government red tape, families and small business owners would no longer have access to low cost credit, and a bureaucrat would stand between them and living the American dream.

The United States Senate should reject the Dodd-Frank bill because it is a job-killer that will only bail out politically connected firms.  Moreover the Senate should insist that any financial regulatory reform legislation address the taxpayer subsidies of Fannie Mae and Freddie Mac.

Dodd-Frank in Brief:

Institutionalizes Taxpayer Funded Bailouts

Dodd-Frank gives politicians and federal regulators the power to continue to bail out politically connected Wall Street firms with taxpayer money rather than allowing failing firms go into bankruptcy.  Wall Street bailouts become permanent at the expense of Main Street.

Fails to Deal with Fannie Mae and Freddie Mac Debacle

Dodd-Frank continues to finance the bailouts of Fannie Mae and Freddie Mac-despite the central role they played in causing the turmoil that devastated our economy. To date, over $140 billion of taxpayer funds have been spent bailing out Fannie and Freddie.  The Congressional Budget Office (CBO) estimates that, in the final analysis, the taxpayers may lose up to $400 billion on the two firms.

Expands the Size of the Federal Government

Dodd-Frank increases government by creating numerous new federal offices that would regulate every phase of economic activity in the U.S. and create a maze of new regulations, all funded by consumers.  Additionally, the legislation would create a powerful new Office of Financial Research (OFR).  The OFR would, by subpoena if necessary, monitor, record and report on any financial transaction, including any consumer transactions that it deems appropriate (and without consent of the consumer).

Increases Taxes

Dodd-Frank further stifles economic growth and authorizes federal regulators to impose as much as $1 trillion in additional cost on various financial transactions.  As CBO recently noted: “The ultimate cost of a tax or fee is not necessarily borne by the entity that writes the check to the government.  The cost of the proposed fee would ultimately be borne to varying degrees by an institution’s customers, employees, and investors.”
Rewards Liberal Interest Groups 

Liberal interest groups—from Big Labor to radical animal rights groups—will get new power under “proxy access” to nominate Left-wing directors to corporate boards and shake down public companies at the expense of ordinary shareholders. Saul Alinsky envisioned the “proxy tactic” as a strategy for the Left in “Rules for Radicals.”

Signed by,
Fred Smith, President, Competitive Enterprise Institute
Virginia Thomas, President, Liberty Central
William Wilson, President, Americans for Limited Government
Wendy Wright, President, Concerned Women for America
David N. Bossie, President, Citizens United
Karen Kerrigan, President, Small Business & Entrepreneurship Council
Colin Hanna, President, Let Freedom Ring
Becky Norton Dunlop, former Deputy Assistant to President Reagan
Mario H. Lopez, President, Hispanic Leadership Fund
Edwin Meese III, former Attorney General
Duane Parde, President, National Taxpayers Union
Tony Perkins, President, Family Research Council
Craig Shirley, Chairman, Citizens for the Republic
Grover Norquist, President, Americans for Tax Reform
Gary Aldrich, Chairman, CNP Action, Inc.
J. Kenneth Blackwell, former Treasurer, State of Ohio
Jordan Sparks, Executive Director, Young Americans for Freedom
Andrea Lafferty, Executive Director, Traditional Values Coalition
Alfred Regnery, Publisher, American Spectator
James Martin, Chairman, 60 Plus Association
Herman Cain, President, THE New Voice, Inc.
Gary Bauer, President, American Values
Tom Winter, Editor-in-Chief, Human Events
David McIntosh, former Member of Congress, Indiana
Curt Levey, Executive Director, Committee for Justice
Richard Viguerie, Chairman,
Myron Ebell, President, Freedom Action
Mathew D. Staver, Founder & Chairman, Liberty Counsel
T. Kenneth Cribb, former Chief Domestic Advisor to President Reagan
Rev. Louis Sheldon, Chairman, Traditional Values Coalition
Marion Edwyn Harrison, Past President, Free Congress Foundation
John Berlau, Director, Center for Investors & Entrepreneurs, CEI