I heard both Congressmen Paul Ryan and Jim Sensenbrenner interviewed on Jay Weber's radio show this morning. (Hour 4 Part 2). Since I trust the opinion of both of these men, I was curious as to why Ryan voted YES and Sensenbrenner NO on the latest bailout bill. 

First Congressman Ryan, who does have a degree in economics. The following are some notes I took from the interview--they are not direct quotes. Listen to the podcast if you can.

Ryan said the bill yesterday was the Paulson plan with quite a bit of tweaks.

The original Paulson bill was 3 pages: Give me a blank checkbook with $700billion.

We wrote a [Republican] alternative. Ours said, Let's make the firms buy insurance.

We rewrote the bill, added stock options--warrants to taxpayers, so the taxpayer is first in line to get money back (if there are profits--that means ACORN would not be getting funding as the orig. Paulson bill stated.) Executives won't get a Golden Parachute.

This bill was $350 billion: $250b immediately and $100b later. An additional $350b would need to be voted on in the future.  

Over the weekend, credit markets went crazy. The problem is not just on Wall Street. Credit markets are shutting down. [That means cash flow for payrolls is unavailable.] There is a fear of recession.

"I'm now sincerely worried this could lead to recession."

Jay Weber: Can we move slowly or do we need to move quickly?

Ryan: Tax money goes out the door either way, this way (bailout) or from FDIC (if banks fail.) Paulson mishandled this so badly.  We added 107 pages to his bill. 

I have never seen things like this [credit freezing up]--ever. Businesses won't be able to cash flow payrolls.

Weber: There is a deep distrust of Congress.

Ryan: 2,300 calls [to my office] almost all against the bailout. [That is changing a little now.] We have to corral Wall Street so it doesn't spill to Main Street.

Weber: Why aren't Republicans hammering this?

Ryan: I am. Since 2002 I have voted against Freddie and Fannie every time.

I think Paul Ryan voted for this measure because he is genuinely worried about our economy shutting down. He knows that if businesses cannot get credit to meet their payrolls, that means workers do not get paid. With many Americans just a paycheck away from being broke, we cannot afford to let that happen. Businesses also use credit to purchase supplies and equipment for future production.

Then it was Congressman Jim Sensenbrenner's turn:

Paulson [Barney Frank] plan fatally flawed from the beginning. That money all came from taxpayers.

The word was, $700billion would not be enough.

America can't afford this. We are wealthy, but there is a limit. 

All of this is inflationary. Interest rates will shoot up. [Remember] 20% prime rates during Carter? 

We should go back to the regular order [of crafting legislation] with committee meetings, rather than Paulson saying we have to do this.

Weber: We're racing against the clock.

Sensenbrenner: When markets opened [today] they were up 200, so hopefully the markets have calmed down.

Paulson is pushing for now. It bailed out the people who caused the problem.

I'm prepared to go back when Pelosi calls us back.

This is a case of Congress serving the people. 

Weber: What angers people is Frank and Dodd in charge of the fix. Is there any mechanism to say when you failed the people, get off the committee!

Sensenbrenner: The Community Reinvestment Act was a significant factor [to what is going on.] 

The process worked yesterday. The speeches like from Pelosi need to stop. She also knew there were not the votes to pass. Why did she bring the bill to the floor? [To fix blame on the Republicans]

Weber: Would you change the Community Reinvestment Act?

Sensenbrenner: Repeal of that law should be in the new package now.

The Security and Exchange Commission dropped the ball--enforcement was not vigorous. 

The Justice Department should investigate if any fraud was committed. [Imprisonment would serve as a deterrent.]

So there you have the Yea and the Nay. Where is Solomon when you need him? 

Conservatives would hope the next version of the bailout bill would be better for taxpayers, that it keeps money from ACORN and repeals the Community Reinvestment Act. With this crew I don't have much hope.

My fear is that the next version will included ACORN funding again or worse. The Democrats will vote for it, and President Bush, who is really over a barrel here, will have to sign it.

Calls from Americans running 500 against, to 1 in favor, of the bailout might be the only thing that saving us from an UGLY pig of a bill.

Post Script: Along the lines of Sensenbrenner's request that they craft this bill carefully, 165 Economists rip bailout plan:

The economists say they are well aware of the current financial situation and agree there's a need for bold action but ask Congress "not to rush."

They urge lawmakers to hold appropriate hearings and "to carefully consider the right course of action." 

Right now the market is up 307 points from yesterday's close. You can check anytime on USAToday. (If you leave it open, it automatically refreshes.) 

Please, comment content should relate to the subject of the post. Although I try to respond to many, do not interpret my lack of a response as agreement.

Links: 

Last night I heard Senator Inhofe (R-Oklahoma) on the Mark Levin Show.  They were discussing S. 2191, the Senate "Lieberman/Warner Global Warming Bill and the disastrous effect this would have not on just the country as a whole, but the individual." (My emphasis throughout post.)

Wall Street Journal referred to Cap-and-Trade as Cap and Spend

As the Senate opens debate on its mammoth carbon regulation program this week, the phrase of the hour is "cap and trade." This sounds innocuous enough. But anyone who looks at the legislative details will quickly see that a better description is cap and spend. This is easily the largest income redistribution scheme since the income tax.

The Washington Post said, Just Call It "Cap-and-Tax" 

"...One of the bad ways [to control greenhouse gas] is cap-and-trade. Unfortunately, it's the darling of environmental groups and their political allies.

The chief political virtue of cap-and-trade -- a complex scheme to reduce greenhouse gases -- is its complexity. This allows its environmental supporters to shape public perceptions in essentially deceptive ways. Cap-and-trade would act as a tax, but it's not described as a tax. It would regulate economic activity, but it's promoted as a "free market" mechanism. Finally, it would trigger a tidal wave of influence-peddling, as lobbyists scrambled to exploit the system for different industries and localities. This would undermine whatever abstract advantages the system has.

...Call this "environmental pork," and it would just be a start. The program's potential to confer subsidies and preferential treatment would stimulate a lobbying frenzy. Think of today's farm programs -- and multiply by 10.

After listening to Senator Inhofe, I think we could also refer to it as Cap-and-Raid! If it passes, it will raid every worker in America's wallet!

Senator Inhofe said, Senator Barbara Boxer insists this is not a tax bill. But if you have looked into the bill itself and at the linked articles, it is difficult to understand how this could not be considered a tax bill.

Inhofe then quickly listed some points to ponder. He mentioned the Wall Street Journal referring to it as the most extensive reorganization since the 1930s. He called it worse than the Kyoto Treaty for the economy. Cap-and-Trade will need 45 more Big Government Bureaucracies to enforce the standards.

Using Boxer's figures, Inhofe pointed out that Cap-and-Trade would collect $6.7 Trillion dollars from industry (those costs will be passed onto us!). The maximum rebate to customers is $2.5 Trillion dollars. Do the math: That means $4.2 Trillion goes where?

That sounds like a tax to me!

He went on to remind us that the Democrats have killed every domestic drilling bill. The US relies on coal for 53% of all of its electricity production. Cap-and-Trade will tax coal fired electricity production. Consider that China "cranks out a new coal electric plant" every 3 days (?). (I think he said 3 days, which fits with this - certainly between India and China it would be true.)

Manufacturing jobs will go where there is (cheap) energy/power, Inhofe said. This is also what Congressman Sensenbrenner talked about at his Town Hall Meeting when he called Cap-and-Trade "Catastrophic for Wisconsin". I would add that manufacturing jobs will also go where environmental regulations are more lax.

Senator Inhofe suggested people take a look at Liberman-Warner Opposition Resource Center; Impacts of Costly Climate Bill Exposed  It is chock full of quotes, links and articles.

The Senate is debating this bill this week. While some say the bill will not pass, as you know, once the foot is in the door, the issue will not go away.  Considering all 3 Presidential candidates support the concept of Global Warming, I would just say, the bill probably won't pass...yet.

Our Senators' response to my emails: Not much hope of a NO vote here--unless they feel the heat from constituents.

This is important! Please contact them both: Senator Kohl (Phone: (414) 297-4451, (202) 224-5653) and Senator  Feingold (Office of Senator Russ Feingold | 202/224-5323) and let them know what you think about this bill.

More reading:

George Will's Cap-And-Trade: A Devious Tax Plan

Good chart of key players and terms explained at end: Senate taking up key climate-change bill 

The Heritage Foundation's Morning Bell: Carbon Capping in Bizarro World 

Links:

If you've ever planned a road trip, mapping your route ahead of time makes a big difference: which way will allow you to travel with the least amount of traffic, major city rush hours, or road construction? Often a little planning ahead can save hours being stuck in a traffic jam. Certainly there is no sense to chart a course leading to a bridge closed for repairs. No reasonable person would say, the only bridge ahead is closed, but we'll make such good time before the bridge, we'll pick that route anyway.

Yet this is what our government is doing by ignoring the coming Social Security/Medicare crisis. Politicians don't want to deal with that reality. They know it is going bankrupt, but their attitude is, we'll cross that bridge when we come to it. "There is a growing, bipartisan consensus about the greatest threat to our nation's long-term economic prosperity: the explosion of entitlement spending." (Ryan)

Last week, Congressman Paul Ryan proposed his "Roadmap for America"--a very practical and pretty painless way to shore up Social Security, Medicare, and the tax code. Ryan is planning the future path for America that allows us to make good time and still cross that bridge in the future, and he does it without massive tax increases. He said in an interview:

I am raising the same rate of tax revenue as today, but I am preventing them from doubling in the future. I am proposing to tax 18.5 cents out of every dollar to run the government as opposed to 40 cents out of every dollar. Spend the money more intelligently. The 1st $39,000 (after deductions) for family of 4 is tax free. After that, the first $100,000 is taxed at 10%.

Ryan also bravely addresses Health Insurance and Medicaid in addition to Social Security, Medicare, and Tax Reform. Simply ignoring these pending problems will not make them go away. Ignoring these entitlements just increases the problems and costs. Hopefully Ryan's route will Not be A Road Less Traveled:

There is no threat to our nation’s fiscal health greater than the coming deficits from unrestrained growth in Social Security, Medicare, and Medicaid. Already Social Security and Medicare consume 7.5% of our GDP. Unless changes are made that figure will jump to 13% by 2030.

Bravely stepping in to offer a policy solution, Rep. Paul Ryan (R-WI) has introduced a plan he calls “A Roadmap for America’s Future.” 

Read through Congressman Paul Ryan's plan in the Wall Street Journal: How to Tackle the Entitlement Crisis for Health Insurance, Medicaid and Medicare, Social Security, and Tax Reform.

We cannot afford to ignore this any longer. Our children are the ones who will pay for our failure to deal with these growing problems. Ryan writes:

According to the Congressional Budget Office, Social Security, Medicare, Medicaid and the rest of government will consume nearly 40% of the economy by the time my [Paul's] three young children reach my age (38). This will require more than doubling the average tax burden of the past 40 years just to keep the government afloat. Continuing down this path will eventually strangle our economy.

Once we come to that "bridge", there is no easy way to cross it. The time to deal with it is NOW! The question is: Do we have any politicians brave enough to do the right thing?

Congressman Paul Ryan is a member of the Congressional Budget Committee and the Ways and Means Committee.

Don't forget the Music Concert to Benefit Chinese Quake Victims, Saturday, May 31st, 10AM - 1PM, Brookfield Civic Plaza

Links:

The Assembly narrowly approved the state budget bill fix, 51 - 46. So now what?

Representative Leah "Vukmir said she hoped Doyle would veto the entire bill."

Rich Zipperer, in his Statement on the Budget 'Repair' Bill, stated, "The solution to the current mess is simple. Control spending...With the state facing a $1.7 billion structural deficit, we can ill afford to knowingly make the problem worse."

Doyle's preference, the AP article stated, was "to take more money from the state's transportation fund, to be replaced with additional borrowing, to help balance the budget. He also proposed $111 million in cuts to state spending while the plan that passed had just $69 million."

Mike Huebsch, Assembly Speaker said in response to criticism from both Republicans and Democrats, "Frankly, if any of these were good ideas, we would have done them already. All of us would prefer changes."

I am inclined to agree with Vukmir, Zipperer, and even Spencer Black (D). "All the deal does is push off the state's financial problems into the future, he [Black] said."

But our Speaker Huebsch infers the budget repair bill is the best we could do? Certainly we could have come up with a better plant than just to delay payment of pending responsibilities. Until we cut spending, we are just postponing our problems.

So now we wait to see what Gov. Doyle does with his veto pen. 

Links:

I heard the state is close to "balancing" our state $527 million budget deficit. Problem is, there are no real budget cuts, just plenty of bookkeeping tricks. Only 1/5th of 1% of the total budget is considered a cut.

One of the areas of bookkeeping magic that really makes me see red is the hijacking of $22 million from Federal Real ID into state budget coffers. Congressman Sensenbrenner doesn't like it either. "The law authored by Sensenbrenner is designed to create a more secure identification card in all 50 states. A $10 fee was placed on Wisconsin driver's licenses starting this year to start paying for it." The state is raiding this fund.

Another budget trick is to delay the $125 million payment of state aid to schools into the next budget session. Much like someone running a little short on funds one month delaying their mortgage payment into their next payday cycle, the state is looking at postponing their yearly obligation into the next budget cycle. This solves nothing and creates a big problem for next time.

One good piece of the budget deal is that the hospital tax is not part of the fix.

Without cutting spending and programs, all this fix does is delay the pain. I am not the only one annoyed by our legislature's failure to cut spending. Take a look at an email one reader fired off to their representatives:

Vote NO on BUDGET FIX

I continue to be really angry with the actions of our State legislators and their failure to cut spending in WI. The taxpayers wallet is almost empty.  I urge you to vote NO on the budget fix, to work TO CUT SPENDING, to take the provision out of the bill that would allow municipalities to tax assisted living and nursing homes, DO NOT take federally mandated monies and use them for something else, PUSH FOR VOTER ID, ignore pressure from special interest groups and listen to your constituency.

How you or anyone else in Madison can justify the huge budget shortfall without cutting spending is beyond me.

I am 58 years old and our family is seriously considering leaving WI when we retire.  Honestly, with the actions of the legislature and Gov. Doyle we may be forced to leave sooner ... I can't afford to live here much longer.

And this is an email sent to Rep. Huebsch, Assembly Speaker

Mike Huebsch --   CUT SPENDING, VOTE NO on the Budget Fix, PUSH for Voter ID, PUSH to take out the right of municipalities to tax nursing homes and assisted living facilities, do not take federally mandated monies and use them for something else.  I think you are the most ineffective leader the Republicans have ever put in power.  I no longer will support the Republican Party in WI because of your liberal views and ineffectiveness in striking a compromise with the Democrats.  AGAIN the way to fix the budget shortfall is not to rob money from other programs BUT TO CUT SPENDING. [Previous email included.]

Contact your representatives! They will be voting soon.

Senate votes today:
State Senator Jim Sullivan, Democrat, 5th District
Sen.Sullivan@legis.wisconsin.gov  608-266-2512,  866-817-6061

State Senator Theodore Kanavas, Republican, 33rd District
Sen.Kanavas@legis.wisconsin.gov  608-266-9174, 800-863-8883

Sen. Scott Fitzgerald (Senate Minority Leader), from Juneau. Counties: Columbia, Dane, Dodge, Jefferson, and Waukesha   Email: Sen.Fitzgerald@legis.wisconsin.gov   608-266-5660

Assembly: 
State Representative Leah Vukmir, Republican, 14th District
Rep.Vukmir@legis.wisconsin.gov  608-266-9180

Representative Rich Zipperer, Republican, 98th District
Rep.Zipperer@legis.wisconsin.gov  608-266-5120 

Rep. Jeff Fitzgerald (Assembly Majority Leader), from Horicon. Counties: Columbia and Dodge Rep.Fitzgerald@legis.wisconsin.gov   608-266-2401

Rep. Michael Huebsch (Assembly Speaker), from West Salem. Counties: LaCrosse and Monroe

Rep.Huebsch@legis.wisconsin.gov    608- 266-3387

Governor Doyle
608-266-1212, 414-227-4344

Links:

Congressman Sensenbrenner brought up Senate bill S. 2191, the Lieberman/Warner "America's Climate Security Act of 2007" at his Town Hall meeting Sunday. He described it as a "disaster for Wisconsin."

Information on S. 2191 from Congressman Sensenbrenner's website:

“S. 2191 proposes a nationwide cap-and-trade program for the emissions of greenhouse gases, like carbon dioxide, an important component of the manufacturing industry.  By setting a limit and capping carbon dioxide emissions by businesses, the Lieberman/Warner bill would thrust a highly regulatory regime on our nation’s economy, making electricity more expensive for businesses and consumers.  In Wisconsin, which relies heavily on the use of coal for electricity, this bill would have a catastrophic effect as we would be especially hard hit.

“This point is underscored in a study commissioned by the National Association of Manufacturers to assess the potential impacts of S. 2191 on Wisconsin’s economy…and the results are scary.

The Congressman discussed that study at the meeting and on Charlie Sykes show. The predictions were "scary."

“According to the study, electricity rates in Wisconsin could increase by as much as 163% in 2030 - nearly tripling today’s costs - and gas prices could increase by as much as 176% in 2030, again, almost tripling today’s cost of natural gas.

Not only will we be paying more for utilities, a figure of a 145% increase in gasoline prices was also given on Charlie Sykes show Monday, April 28, Ready for $10 a gallon gas?

So not only do we get to pay for higher energy costs for our own use, but we will pay more for every item and service produced in Wisconsin too.  

Who would ever want to live in Wisconsin or locate their business here if that is the case?

The National Association of Manufacturers report estimated that by 2030, 74,000 jobs would leave Wisconsin and a whopping 4 million jobs would leave our nation, because businesses naturally seek the cheapest and easiest place to manufacture their products.

What exactly is a cap-and-trade and why does it have such a negative impact on Wisconsin? 

Cap-and-trade is another term for Carbon Credit (or indulgences). Congress or bureaucrats set a cap or maximum on greenhouse gases that can be emitted by a company--be it a corporation or a utility company. Companies that do not comply with the standard must then have to purchase carbon offsets from companies that do comply. It is like a type of stock market that deals in these special credits.

According to Congressman Sensenbrenner, since Wisconsin gets 2/3 of its electrical power from coal fired plants, but Illinois obtains 60% of its electric power from clean nuclear power plants that emit 0 CO2, we will have to purchase these carbon offsets from Illinois just to keep producing our needed electricity! Illinois in effect gets their energy costs subsidized by Wisconsin residents. Wisconsin ends up paying 176% more for our electricity. OUCH! (At present, only 20% of Wisconsin electric comes from nuclear plants.)

Think no one in their right mind would agree to a system like this? Think again. Europe has been doing this for nearly 3 years now. Europe's greenhouse gases continue to rise as do their electricity rates. It has done nothing to lower emissions according to a publication from Sensenbrenner's office. I believe Australia just signed on to a system of carbon credits too.

Since businesses will just relocate to third world countries to manufacture their goods, these carbon credits will do nothing to lower CO2 emissions worldwide. The pollution will just move to the far east.

The increase in costs due to cap-and-trade fees are estimated at $1,300 a year / household for Wisconsinites.

Please contact Senators Kohl (Phone: (414) 297-4451, (202) 224-5653) and Feingold (Office of Senator Russ Feingold | 202/224-5323) and let them know what you think about this bill. 

Representative Zipperer informed the Town Hall meeting atendees that the Wisconsin Assembly recently passed legislation that lifted the moratorium on nuclear power plants last session. The Senate however did not. He said they would try again next time. 

Contact your state representative and senator about the moratorium.

State Representative Leah Vukmir, Republican, 14th District
Rep.Vukmir@legis.wisconsin.gov  608-266-9180

Representative Rich Zipperer, Republican, 98th District
Rep.Zipperer@legis.wisconsin.gov  608-266-5120

Congressman Sensenbrenner's contact info:Email  Telephone: (262) 784-1111, (202) 225-5101  

Links: Upcoming events in Brookfield

4th Annual Weed Out, May 3rd, Mary Knoll Park