Skip to comments.Paul Ryan explains his votes for TARP, bailouts and tax on AIG bonuses
Posted on 02/14/2010 4:37:15 PM PST by FTJM
A recent column in which blogger Matt Lewis questioned the conservative credentials of Rep. Paul Ryan, Wisconsin Republican, got a lot of attention on our Web site. A number of Daily Caller readers have commented about Ryan, saying he has cast votes they disagree with, particularly in favor of the $700 billion TARP bailout for Wall Street, the auto bailouts and the taxes on AIG bonuses.
Heres how Lewis put it:
Though he talks like Nobel Prize-winning economist Milton Friedman, some of Ryans most high-profile votes seem closer to Keynes than to Adam Smith. For example, in the span of about a year, Ryan committed fiscal conservative apostasy on three high-profile votes: The Troubled Asset Relief Program, or TARP (whereby the government purchased assets and equity from financial institutions), the auto-bailout (which essentially implied he agrees car companies especially the ones with an auto plant in his districtare too big to fail), and for a confiscatory tax on CEO bonuses (which essentially says the government has the right to take away private property if it doesnt like you).
While Ryans overall voting record is very conservative, the problem with casting these high-profile votes is that they demonstrate he is willing to fundamentally reject conservatism when the heat is on.
Because it is impossible to believe the highly intelligent and well read Rep. Ryan was unfamiliar with conservative economic principles, one must conclude he either 1). Doesnt really believe in free market economics, or 2). Was willing to cast bad votes for purely political purposes.
I asked Ryan about these criticisms during a phone interview this week. Heres what he had to say:
The DC: As youre getting more attention, besides the criticism that youre getting from the Democrats, Ive also started to see some critical comments of you from the right over your votes for TARP, the auto bailout, and the tax on CEO bonuses. How often do you hear that in your home state, how often do you hear it on the Internet, and what do you tell people when they criticize you on those things?
Ryan: You know I dont hear it here at home that much. Youve got to remember Obama won my district. Dukakis and Gore won my district. Clinton won my district. So I dont come from, you know, a red area. So I think its important to keep in mind where I come from. I dont hear that here.
TARP. Ill take one at a time. I believe we were on the cusp of a deflationary spiral which would have created a Depression. I think thats 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 wouldnt 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 wasnt a fun vote. You dont 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.
Auto. Really clear. The presidents 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 didnt 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. Thats what they told me. Thats what the presidents chief of staff explained to me. I said, Well, I dont want them to get TARP. We want to keep TARP on a [inaudible]. We dont 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 theyve got $87 billion from TARP, money were 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.
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 itd be a good signal to send to the large banks who were jumping into this thing, who really didnt need it: Stay away from this, dont get in bed with the government, even though it might in the short term give you a leg up on your competitors, youll 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 didnt 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.
In honor of this, will someone please call me a newbie and tell me to go back to DU?
Any Republican who voted for any of the bailouts is a RINO!
A Freudian answer.
What a tool.
I can see where people may have gotten surprised by the TARP bailout and not completely understood what was going on.
I don’t see any excuse whatever for the Government Motors takeover. None. It was a pure union payoff, and it will end up destroying Detroit’s car companies.
Not so sure why people have recently been championing this guy. He sounds like Kerry trying to explain away a vote (well, I voted for it to prevent what I thought would happen and it happened anyway....HUH?!?!?)
Moreover, he basically admitted that he is playing to the crown by saying, “remember what district I’m in”. TARP, Porkulus and GM Bailout are all easy votes; I don’t care what the lawyers were saying the “commoner” had no problem determining that these were pork sandwiches
In other words, he wants to reinflate the bubble. In my mind, Paul Ryan's cautious answers to the questions have not alleviated the concerns Matt articulated. The representative wants it both ways, and for that reason, he cannot be a credible advocate of the free market. If Ryan does not see the virtue in voting in favor of the free market when given the opportunity, at the very least, the sincerity of his convictions must be questioned.
“Any Republican who voted for any of the bailouts is a RINO!”
Yes, by definition!
I still have not seen a credible argument for blocking the price discovery process. The TARP vote was a coward vote.
I agree with you on TARP, that was a most dire time for the markets.
The rest was a terribly misguided group of votes. No excuse at all.
in other words: the govt screwed up so we have to fix it with tarp and since tarp screwed things up, we need to fix it again with the auto bailout and since that screwed things up, we need another govt program to fix all of those problems and...
“Youve got to remember Obama won my district. Dukakis and Gore won my district. Clinton won my district. So I dont come from, you know, a red area. So I think its important to keep in mind where I come from. I dont hear that here.”
yeah I’m sure all those liberals were jumping and down for TARP and the auto bailouts. /sarc
I was against it. But you have your own Republican-appointed Treasury Secretary saying that if you don’t do it, the world will come to an end. It was not evident to everyone at the time that Paulson was a crook. I thought it was a mistake, but a lot of smart people said it was the only possible thing to do.
So, sure, the vote was misguided. But I’d be more incline to forgive it if he hadn’t voted for Obama’s Government Motors takeover.
NO QUARTER for anyone who voted for TARP, signed off on TARP, or had anything at all to do with TARP.
New and Improved CONSERVATIVE RINO!
For all those of you who are so indignant about TARP, just ask yourself one question:
If we hadn’t passed TARP and foreigners had decided to liquidate all their time deposits from our institutions, how much more would it have cost the FDIC to pay off all of the bank deposits that were insured when ALL of the major financial institutions were shut?
All of you forget that the FIRST THING that happened before TARP was that most of the major money center banks raised capital from the foreign sovereign wealth funds, about $20 billion worth. ALL of that capital was lost in less than a month.
It was clearly stated to the US government by these investors who had just been RIPPED OFF by US institutions that if the government didn’t get involved they would withdraw their money from the US banking system.
THAT would have been TRILLIONS in withdrawals. All of you big talkers have any idea who would have replaced that money?
When a bank loses it deposits it either has to call in its loans OR SHUT DOWN IMMEDIATELY.
TARP was clearly the lesser of two evils. The problem with TARP is that it should have been given to the smaller, healthier banks to buy the assets of the schmucks that lost it, not to the large money center banks.
That way, moral hazard would mean something, the loss of power and lifestyle of the NY-centric banking world.
I've seen him speaking on other occasions, and he seems like a strong fiscal conservative, he just got spooked by what was going on at the time.
See what I mean by lemmings and stupidity here ? A member of our party doesn't know what "red" means when he just described his district voted for RED moonbats ?
And this is why I don’t trust Paul Ryan despite so many here on FR Touting him as the Future of the Republican Party in Congress!! He is a useful idiot at best, and fool at worst (at least he doesn’t understand the Constitution).