Congress Returning for Lame Duck Session This Week

This week, Congress is set to return to Washington for a brief lame duck session to consider a proposed $25 billion bailout for Detroit automakers.  The Senate is expected to meet today, while the House is scheduled to come back on Wednesday.

At this time, the details of the package remain undefined, but I am concerned about the impact on hard-working taxpayers already saddled with more than a trillion in debt that was meant to steady the economy but has yet to show any signs of working.  Just last week, Treasury Secretary Hank Paulsen was remarking on how the money thus allocated from that bailout had yet to reach hard-pressed families or quell the credit crunch.  At this point, the money has been used solely to shore up banks and other financial institutions and there hasn’t been much of a trickle down to Main Street taxpayers.

Both the Senate and House automaker bailout packages are expected to carve out $25 billion from that same $700 billion.  You may recall that Congress approved $25 billion in loans specifically for the auto industry back in September, even before Congress passed the financial service sector bailout.  Some have argued that the auto industry should be drawing on that money for help instead of siphoning off additional money from the massive Wall Street bailout.  As Commerce Secretary Carlos Gutierrez said this weekend on CNN, “There’s a line of companies of industries waiting at Treasury just to see if they can get their hands on those $700 billion.”  If we use those funds for the automakers now, will troubled mortgage holders ever see any help?

I opposed the massive Wall Street bailout package in October because I didn’t think it was the right remedy for what ails our economy, and I supported serious and fundamental reforms in its place.  I am similarly skeptical that a new bailout for the automakers is the right answer and I am anxious to see the details of the proposals that will be voted upon.  President-Elect Barack Obama noted this weekend in an interview on 60 Minutes that “we shouldn’t worry about the deficit next year or even the year after,” but I am concerned that it is precisely that type of lax attitude that will pull the taxpayers and the economy into far deeper economic problems.