Spring Break
Column: Government fails in wake of AIG
Matt Zimmerman / Columnist
Issue date: 3/31/09 Section: Opinions
I'm sure everyone has heard about the recent American International Group bonuses. AIG, a taxpayer-rescued company, gave out about $165 million in bonuses. As bad as that is, the situation reveals something else: as always, the ineffectiveness of the government.
Concerning the bonuses, Congress let its outrage be known. President Barack Obama said he would pursue every legal avenue to retrieve the money.
The House of Representatives, with bipartisan support, then passed a bill that would tax the bonuses at a rate of 90 percent. Unfortunately, the bill wasted a week and is unconstitutional on multiple points. They're easy political points, though.
Sen. Chris Dodd, D-Conn., who came up with that idea, actually inserted an amendment into the stimulus bill, as he says, at the request of the Obama administration, exempting AIG from limits on bonuses. The administration asked for a law allowing these bonuses and then called for an end to greed when they gave them.
More important is that this outcry has diverted attention from much larger battles taking place.
Weeks after warning the country we may never recover from the recession, Obama's chair of Council of Economic Advisers said the fundamentals of the economy are sound, which Sen. John McCain, R-Ariz., was ridiculed for saying. There are rumors that there is another stimulus on the way while the budget being debated predicts recovery by year's end.
Predictions of economic growth are important for many reasons. One such reason is the prediction of future government revenue, which is used to make budget projections.
The Congressional Budget Office predicts the proposed budget will lead to trillion-dollar deficits every year for the next 10 years, doubling the inexcusable Bush deficits. That is the cost of 16 Iraq wars.
This whole thing is another example of the government being utterly incapable of doing anything right. The government did much to create the mess we are in by encouraging risky lending, holding interest rates down because of an obsessive fear of a politically damaging recession, and neglecting even a cursory use of the significant regulatory powers they already possessed.
Now, hypocritical politicians are acting like a mob: Dragging people into Congress, beating their chests, passing irrelevant laws and in the most expensive way possible, doing more of the same by barely addressing broad, critical issues.
It is important to consider the federal government's incoherent response to its own mess over this past year. There are real calls for sweeping new regulatory powers over Wall Street. There are real calls for nationalized health care. The federal government has an ever-increasing role in our lives from the energy we use to kids' educations.
When considering these issues, just ask yourself if you really want Nancy Pelosi to have anything to do with your health care or Mitch McConnell setting standards for your kids' educations. I think there is a better way.
Matt Zimmerman is a senior political science major. He can be reached at 581-7942 or at DENopinions@gmail.com.
Concerning the bonuses, Congress let its outrage be known. President Barack Obama said he would pursue every legal avenue to retrieve the money.
The House of Representatives, with bipartisan support, then passed a bill that would tax the bonuses at a rate of 90 percent. Unfortunately, the bill wasted a week and is unconstitutional on multiple points. They're easy political points, though.
Sen. Chris Dodd, D-Conn., who came up with that idea, actually inserted an amendment into the stimulus bill, as he says, at the request of the Obama administration, exempting AIG from limits on bonuses. The administration asked for a law allowing these bonuses and then called for an end to greed when they gave them.
More important is that this outcry has diverted attention from much larger battles taking place.
Weeks after warning the country we may never recover from the recession, Obama's chair of Council of Economic Advisers said the fundamentals of the economy are sound, which Sen. John McCain, R-Ariz., was ridiculed for saying. There are rumors that there is another stimulus on the way while the budget being debated predicts recovery by year's end.
Predictions of economic growth are important for many reasons. One such reason is the prediction of future government revenue, which is used to make budget projections.
The Congressional Budget Office predicts the proposed budget will lead to trillion-dollar deficits every year for the next 10 years, doubling the inexcusable Bush deficits. That is the cost of 16 Iraq wars.
This whole thing is another example of the government being utterly incapable of doing anything right. The government did much to create the mess we are in by encouraging risky lending, holding interest rates down because of an obsessive fear of a politically damaging recession, and neglecting even a cursory use of the significant regulatory powers they already possessed.
Now, hypocritical politicians are acting like a mob: Dragging people into Congress, beating their chests, passing irrelevant laws and in the most expensive way possible, doing more of the same by barely addressing broad, critical issues.
It is important to consider the federal government's incoherent response to its own mess over this past year. There are real calls for sweeping new regulatory powers over Wall Street. There are real calls for nationalized health care. The federal government has an ever-increasing role in our lives from the energy we use to kids' educations.
When considering these issues, just ask yourself if you really want Nancy Pelosi to have anything to do with your health care or Mitch McConnell setting standards for your kids' educations. I think there is a better way.
Matt Zimmerman is a senior political science major. He can be reached at 581-7942 or at DENopinions@gmail.com.
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