NC Senate Candidate Jan MacKay comments about the Economic Crisis on Wall Street:
September 23, 2008
I’m not running for Congress, and have no more clout than any of you. However, it is time that the government reaffirms citizens as the highest office on the land. There are serious problems, but the government has no right to take your hard-earned money from the US Treasury to bail out people who gambled and lost their bets. Reform is needed, but no bailouts and bureaucracy. Speak your mind now!
Please contact the US House and US Senate immediately!

For Immediate Release
Sep 25, 2008

The 'Bailout From Hell' Must be Rejected

An OpEd from Libertarian Party nominee Bob Barr

In the name of restoring economic confidence, the Bush administration is demanding unlimited authority to implement a massive financial bailout. The Secretary of the Treasury would become an economic dictator, empowered to re-engineer the economy as he sees fit. These powers fit Kim Jong-il's North Korea, not the American republic.

The economy is in trouble, but the wrong policy could make things much worse. With the public deeply divided over the proposed bailout, and the future structure of our economy at stake, Congress must stop and take a deep breath before rushing such a far-reaching plan into law.

Rep. Barney Frank, Chairman of the House Financial Services Committee, claimed: "The private sector got us into this mess, the government has to get us out of it." In other words, "Let's just put Sen. John McCain or Sen. Barack Obama in charge and everything will be fine."

This is nonsense. This is irresponsibility of the highest order.

The financial crash is not a "crisis of capitalism." It is the result of foolish federal policies manipulated by private interests -- precisely how Washington always operates. Giving Washington more power is no solution.

The federal government cannot eliminate financial losses and should not attempt to do so. It can only shift the burden -- in this case from irresponsible borrowers, lenders and investors -- to taxpayers. Keeping the walking dead on economic life support will only slow down necessary adjustments. The federal government's principal responsibility at a time of financial stress should be to maintain liquidity for use by otherwise sound institutions.

Congress certainly should reject an unrestricted, economy-wide purchase of mortgages and mortgage-backed securities, as well as "other financial instruments" at the Treasury's discretion. Interest groups already are lining up with their hands outstretched, including mortgage lenders and insurance companies, municipalities and foreign banks. The congressional Democrats even want to include home heating assistance and another wasteful "stimulus" package.

If the administration believes there are financial institutions so critical that their failure would put the entire economy at risk, then the president should identify those institutions and make the case for aiding them to Congress and, more important, to the American people.

In any case, Congress should emphasize accountability. The administration has proposed a bare, two-page law including an extraordinary provision declaring: "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."

The secretary would be able to decide which assets to buy from whom at what price and in what manner. Both the Republicans and Democrats would benefit from Treasury's unreviewable power to hire consultants and choose firms to implement the bailout. This is a prescription for extravagant waste, incompetence and abuse.

The Bush administration played this game before, using 9/11 to ram the Patriot Act through Congress, and then misused its authority while resisting court oversight. Never again should Congress allow itself to be duped in this way.

Congress must address the causes of the current crisis; most of which stem from government missteps.

Take the Federal Reserve, for example, which has untrammeled discretion--of the sort being sought by Treasury Secretary Henry Paulson--to mismanage the money supply.

The Fed's easy money policy helped create an economic bubble. Everyone from consumers to investment banks over-extended themselves. Prices for commodities, and especially houses, rose dramatically. We must hold the Fed accountable--or even replace it--to ensure sound money that is safe from political manipulation.

Second, Fannie Mae and Freddie Mac were used by Congress to simultaneously expand mortgage lending and enrich politically influential interests. The two entities must be fully privatized, and left with no federal support, guarantees, or dictates.

The Community Reinvestment Act is used to force banks to make bad loans to poor credit-risks in inner-city neighborhoods. Some of the politicians who now denounce "predatory lending" previously attacked those same banks for not lending. The CRA should be repealed.

Finally, expansive but disjointed regulation has failed to deliver transparency, which allows firms and investors alike to know their exposure. In fact, some regulations have been counterproductive.

For instance, the Securities and Exchange Commission enforces "mark to market" accounting rules that requires firms to write down assets--even those held for income rather than trading purposes, to current values. In today's unstable circumstances, one fire sale of an asset of uncertain value can ruin an entire industry's balance sheet. The SEC should suspend the rule's enforcement until accounting agencies and regulators can reevaluate its impact.

"My first instinct was to let the market work, until I realized, while being briefed by the experts, how significant this problem became," lamented President George W. Bush. So, he would turn capitalism into a government-protected enterprise and Uncle Sam into an ATM machine for economic failures. Congress must say, "No." Why should we, the taxpayer, believe the people who got us into this mess when they say bailing them out is the only solution?

For Immediate Release
Sep 28, 2008

Congress Should Vote ‘No’ on Bailout, Says Bob Barr

“The leaders of both the Republican and Democratic Parties are rushing ahead with their $700 billion bill,” says Bob Barr, the Libertarian Party candidate for president. “Without a single hearing and without considering other solutions, Congress is preparing to put the typical American family on the hook for more than $8,000. Legislators in both parties need to stand up for the American people and say no,” says Barr.

“If bailouts are the answer, why hasn’t the $300 billion housing bailout worked? What of the $100 or more billion bailout of Freddie Mac and Fannie Mae?” Barr asks. “This bailout package doesn’t resolve the underlying problems. It merely transfers the liabilities to the taxpayers,” he observes. “Instead, we need to make Wall Street take the hit for its irresponsible investment decisions.”

“The process will be painful. Some companies will go bankrupt. Some firms will go into receivership. Healthy companies will take over failing institutions,” Barr adds.

“Instead of bailing-out banks and investors, Congress should address the causes of today’s economic mess. The first is to end government pressure for irresponsible lending. That means privatizing Fannie Mae and Freddie Mac and repealing the Community Reinvestment Act. It also means depoliticizing the nation’s money supply. The Federal Reserve cannot continue artificially inflating the money supply, which creates the illusion of a boom that is inevitably followed by a bust,” observes Barr.

“The government needs to investigate and prosecute fraud. It also needs to adjust accounting rules, such as ‘mark-to-market,’ which threaten the balance sheets of sound companies. We need to streamline complicated regulations that have not created transparency for customers and investors. And we need to look at any rules that make it harder for companies to make the necessary adjustments themselves,” says Barr.

“The bailout bill is not only bad because it forces innocent taxpayers to pay off irresponsible bankers and investors, but because the bill creates an excuse for more extensive federal economic meddling—setting corporate salaries, receiving stock in companies, and 'adjusting' mortgage terms. Once the government gets into these areas of the economy, it isn’t likely to get out,” Barr warns.

Finally, Barr explains, “we must force the federal government to get its fiscal house in order. The national debt already is $9.5 trillion. Social Security and Medicare currently threaten us with $100 trillion in unfunded liabilities,” Barr says. “Just where will this new $700 billion come from?”

“With the economic crisis upon us, painful adjustments are inevitable. Instead of bailing-out those who made the mess and slowing down the adjustment process, Congress needs to get out of the way. Its job is to fix government policies that have made things worse. The job of the American people is to replace those politicians who created the failed policies—and who today think the answer is to conscript the public’s money to pay off failed businessmen. Only by voting for Bob Barr and the Libertarian Party will the American people be voting for the change that is necessary."

Libertarian Party presidential candidate Bob Barr represented the 7th District of Georgia in the U. S. House of Representatives from 1995 to 2003.

The Libertarian Party is America's third largest political party, founded in 1971 as an alternative to the two main political parties. You can find more information on the Libertarian Party by visiting www.LP.org. The Libertarian Party proudly stands for smaller government, lower taxes and more freedom.

NC Senate Candidate Battles Safety Nanny Government
Raleigh NC, Bikers USA, September 29, 2008

On April 25th, Jan MacKay says she was nearly run down on Garner Rd, by a highway patrol truck driven by a state trooper, just down the street from Highway Patrol Headquarters. She received a ticket for not wearing a helmet, despite wearing one which she says meets the lawful requirements. Perhaps, it did not appear to conform. Perhaps, it did not meet with the troopers subjective approval. However, Ms MacKay says it was a manufacturer self-certified partial coverage helmet. As such, it is of a type compliant with federal motor vehicle safety standard, FMVSS 218, therefore lawful.

Since then, she has gone to district court four times. The first three times, the court was not ready to proceed. The trooper who is based in Surry and Yadkin counties has driven to Raleigh twice, a 5 hour round trip, and sat in court. The total amount of time the trooper has been away from patrol has been approximately 17 hours, over an infraction which carries a $25 fine. This seems like a travesty not wanted by the taxpayers. Some citizens might also see problems when consumers, rather than manufacturers, are held responsible for complying with federal requirements on motor vehicles and motor vehicle equipment, and in the case of a helmet - what they wear.

On July 1st, Ms MacKay announced her candidacy for NC Senate representing Senate District 15 which is North Raleigh, Wake Forest, and unincorporated areas around Falls Lake, which she says should remain unincorporated despite annexation plans. She is getting lots of well-wishers from all over North Carolina and from other states as well. Her internet campaign is doing well, with a website is top-ranked on Google. "That's good because I do not have money from PAC's and lobbyists in order to support my campaign. I think the pathway to ending corruption in Raleigh is for legislators to stop taking money from special interests. Information, yes. Money, no. I will try to live on the meager $20,659 salary and do my best for the people rather than the well-financed."

On August 27th, she was found guilty in district court and immediately appealed to Superior Court. According to the judge, she was not found guilty due to the leather helmet she was wearing, but because the trooper testified the straps were not tightly cinched under her chin. It was exactly the type of decision she wanted, because an appeal to Superior Court is needed in order to overturn the NC helmet law and stop law enforcement from being overly aggressive in pulling over motorcyclists.

On September 26th, she served a copy of a 26 page legal brief on the Wake County District Attorney Office and filed it with the clerk of Superior Court. Jan is not a lawyer, and is defending herself. "I do not recommend anyone represent themselves pro se in major crimes, but if an intelligent person cannot represent herself in court against a minor infraction, and get a fair trial, then our judicial system has serious problems". If the law is overturned, people will still be able to wear helmets. They will be able to wear any helmet they want, rather than being forced to wear one that someone in China says is compliant, and perhaps they will not be forced to attach any device to their heads. This is all about individual liberties and the right to decide such important matters for themselves rather than rely on a safety nanny government to make all decisions for us. The date for the trial in Superior Court is November 10th, six days after the election. Perhaps it will be the first of many rights and individual liberties "Senator" Jan MacKay will energetically fight for.

This press release can be downloaded in any of the following formats: .pdf .doc .odt

Tags:
nc senate, ncga, safety nanny, safety nanny government, nc helmet laws, nc bikers

For Immediate Release
Sep 30, 2008

Barr Praises House for Rejecting Wall Street Bailout

“Few people thought it could be done, but members of Congress listened to the people rather than the establishment to vote down the proposed $700 billion bailout of Wall Street," notes Bob Barr, the Libertarian Party presidential nominee. “Their courageous action gives us a chance to start over. Our starting point should not be a government bailout. It should be a market work-out,” says Barr.

“The bailout package was flawed from front to back, starting with its price tag,” Barr explains, noting that a Treasury Department spokesman admitted to Forbes.com that the data was 'not based on any particular data point.'

Following the House's vote, New York Times Chief Financial Correspondent Floyd Norris stated that although the bill was supported by Senators John McCain and Barack Obama, "a majority of the House voted along with Bob Barr."

"On this basis the Bush administration would stick every American citizen with a bill for 2,300 dollars," says Barr. "That would cost a family of four more than 9,000 dollars—which is a really large number for the average Americans who pay most of the government’s bills. This is arrogance masquerading as leadership,” adds Barr.

“Moreover, the prospect of a government bailout has discouraged private companies from taking tough steps to improve their financial balance sheets," says Barr.

"Why sell damaged assets in a slow market when the government might take them off your hands?” asks Barr. “Administration and congressional leaders should announce that the bailout is dead and financial institutions will be responsible for their own mistakes. That may mean takeovers for some, work-outs for others, and bankruptcy for the worst off. Government bailouts don’t eliminate the pain of an economic bust. They only shift who pays,” he adds.

Most important, Barr says, “The administration and Congress should get busy addressing the policy mistakes which have gotten us into this mess. We need fraud investigations and prosecutions to police the market. We must privatize Fannie Mae and Freddie Mac so they can no longer be used as political tools to irresponsibly expand mortgage lending. We must adjust accounting rules, like the ‘mark to market’ standard, which have crippled the balance sheets of essentially sound companies.”

Instead of being panicked into voting for a bad bill, “legislators should take a deep breath, stay out of the way as the market continues its painful adjustment process, and start fixing the financial problems that government caused over the years. The best person to oversee this process is someone who hasn’t been part of the problem in Washington. Only a vote for Bob Barr and the Libertarian Party will yield the sort of change necessary to get our financial system back in order,” Barr says.

Libertarian Party presidential candidate Bob Barr represented the 7th District of Georgia in the U. S. House of Representatives from 1995 to 2003.

The Libertarian Party is America's third largest political party, founded in 1971 as an alternative to the two main political parties. You can find more information on the Libertarian Party by visiting www.LP.org. The Libertarian Party proudly stands for smaller government, lower taxes and more freedom.

For Immediate Release
Oct 01, 2008

John McCain’s Actions are not Bipartisan, They are Bipolar

"Sen. John McCain claims he can provide leadership, but he panicked in the face of cries that the sky is falling from Wall Street investors who made bad investments, and the taxpayers are going to pay over $700 billion for his lack of leadership," says Libertarian Party Presidential Nominee Bob Barr.

"Sen. McCain claims he will change Washington by eliminating 'earmarks', but he just voted for more than $103 billion dollars of bold-faced earmarks," says Barr.

"Sen. McCain claims he will change the way things are done in Washington, but he railroaded a $700 billion Wall Street bailout through the Senate with no study or debate, no alternative and no special interest left behind," Barr continues.

"Sen. McCain claims he can act in a bipartisan manner, but his actions on the Wall Street bailout bill shows he acts in a bipolar manner," says Barr.

Libertarian Party presidential candidate Bob Barr represented the 7th District of Georgia in the U. S. House of Representatives from 1995 to 2003.

The Libertarian Party is America's third largest political party, founded in 1971 as an alternative to the two main political parties. You can find more information on the Libertarian Party by visiting www.LP.org. The Libertarian Party proudly stands for smaller government, lower taxes and more freedom.

For Immediate Release
Oct 01, 2008

BARR: No more government guarantees

Just one week ago, Treasury Secretary Henry Paulson was demanding that Congress grant him unprecedented, unreviewable authority to spend $700 billion or more to bail-out Wall Street. But in a major rebuke to the administration and to both the Republican and Democratic congressional leadership, the House voted down the 110-page plan that emerged from last weekend´s frenzied — if not unseemly — effort by Mr. Paulson to salvage a bailout deal.

The Dow dropped some 10 percentage points in reaction to the House vote and, while that was less than a third of the massive percentage drop it suffered in 1987, it shouldn´t surprise anyone that Wall Street was upset at being denied at least $700 billion of taxpayer´s money to practice more of what got it into trouble in the first place — buying up over-valued mortgage-based securities. A majority of members of Congress correctly concluded that the leadership-backed bailout bill was, to put it mildly, bad and that the closed-door sessions that spawned it were deeply flawed as well.

Perhaps at long last, some basic understanding of economics is seeping into the Capitol. Dare we hope that some members now understand the fact that Congress can only redistribute, not eliminate, the pain of an economic downturn? At a minimum now, as a result of the House “no” vote, Congress has time to seriously consider alternative strategies and it needs to press its advantage.

The starting point should be private market adjustment. With the knowledge that an easy government bailout is no longer around the corner, the markets can get serious about working through the mountain of bad debt that imperils homeowners, banks and companies alike.

Unfortunately, artificial booms inevitably lead to painful busts, but these can be productively addressed. Today, this means a mix of bankruptcies, company workouts, and takeovers as we are seeing in the banking sector and outside investors buying large pieces of companies, such as Warren Buffett´s $5 billion investment in Goldman Sachs. This process will reward more responsible firms and encourage them to move early to correct past mistakes.

Many companies also will have to sell mortgage-backed securities. Obviously, companies holding over-valued mortgage-based securities (MBS) prefer to dump bad securities on the government than sell them in a down market. But there is a market even though asset values are uncertain. Merrill Lynch liquidated its MBSs in July.

Bailout advocates simultaneously tell us that these assets are “toxic” and are destroying firms, but which magically at the same time are possessed of value that will ultimately make money for the government if it is allowed to buy them with taxpayer funds. However, good business leaders know that private investors are better able than government officials to dig out that hidden value. Private buyers, too, could participate in reverse auctions and hire asset managers on their dime, not the taxpayer´s. This adjustment process should be carried out in the marketplace — not behind closed doors in Washington.

Both Congress and the administration should focus on cleaning up the mess, not making it potentially far worse. Federal and state authorities need to begin to aggressively prosecute fraud in private markets; fraud that has resulted in trillions of dollars of grossly and deliberately, if not criminally negligently, overvalued mortgage paper. The goal is not to create scapegoats, but to keep markets clean. At the same time, we need a thorough investigation of the misbehavior of public officials in spurring Fannie Mae and Freddie Mac, for instance, to engage in reckless lending. Many of the politicians leading the attack on Wall Street for its failures worked overtime to create the subprime lending debacle.

Congress should rein in the Federal Reserve System. Over the last decade the Fed has followed an easy money policy designed to spur economic growth. But this encouraged irresponsible lending and inflated property values. Increasing the money supply is a bit like mainlining heroin — it´s pleasant while you´re doing it, but it´s extremely painful when you finally stop. Yet as currently configured, the Fed is neither transparent nor accountable.

Congress must say never again with Fannie Mae and Freddie Mac, which lowered mortgage standards and pushed people into new or larger homes than they could afford. These government-sponsored enterprises must be privatized; there must be no more implicit or explicit public guarantees for mortgage lending.

Congress needs to repeal the Community Reinvestment Act. The CRA effectively forces banks to lend to poorer communities irrespective of the creditworthiness of borrowers. Many of the same legislators who demanded increased bank lending in the inner-city now criticize banks for making “predatory loans.” Agencies such as the Securities and Exchange Commission need to suspend the mark-to-market accounting standard and reconsider its application. The rule makes sense for trading assets, especially where values are well established; however, the standard has a perverse impact when applied to long-term income-producing assets in a volatile market. A single major, bad sale can force a major corporate write-down, artificially crippling an otherwise creditworthy firm.

We need better, more streamlined regulation, not more regulation. There are a multitude of government financial regulators, leaving us with expensive controls, but without the transparency most needed by customers and investors.

Finally, we must control federal spending. Where is the $700 billion or more for a bailout supposed to come from, in a government already drowning in deficit spending and a spiraling national debt? Who will bail-out the federal government when investors at home and abroad refuse to buy its paper Instead of attempting to ram through a new version of this bad bill, the president and congressional leaders should announce that a government bailout is off the table. Companies and institutions must focus on systematically working through their problems, in a transparent, focused effort, utilizing the tools in the government´s already-massive quiver of tools.

We must learn from today´s economic disaster lest, to paraphrase George Santayana, we repeat this painful experience in the years ahead.

Bob Barr, a former Republican congressman from Georgia, is the official candidate for president of the Libertarian Party.

Originially published at the Washington Times ...

For Immediate Release
Oct 02, 2008

Barr Blasts House for Caving on Bailout Bill

Senate, White House Pressure Trumped Principle for 58 Members

“It didn’t take much to buy a House vote, only about $130 billion in so-called sweeteners,” says Bob Barr, the Libertarian Party candidate for president, referring to the 58 members of Congress who changed their vote from 'no' to 'yes' in support of the bailout bill. “So now the House has joined the Senate in taking $700 billion-plus worth of Main Street’s money to bail-out Wall Street. Congress spent money it doesn’t have to get reluctant members to vote even more money that they don’t have."

"When will it end?” asks Barr.

“The bailout was supposed to pacify the markets, but the stock market dropped after the bill’s passage," Barr continues. "And no wonder; the 2008 federal deficit ran more than $400 billion. Even without the bailout, Washington will run up a half-trillion in red ink in 2009. The national debt already is $9.5 trillion, with the debt ceiling now pushed to $11.3 trillion. Toss on top of that the total unfunded liabilities for Social Security and Medicare, which exceed $100 trillion,” observes Barr. “Again, when will it end?” Barr asks.

“The bailout will set back the economy’s recovery. It tosses good money after bad. It also punishes companies that attempt to work through their problems without taxpayer largess. Now only a fool will take tough steps to clean up his firm’s balance sheet," Barr explains.

"Instead, they will put in a call to Treasury Secretary Henry Paulson to ask for help,” notes Barr. “Moreover, Congress is creating a bailout culture. No matter how foolish or irresponsible a borrower, lender, or investor may be, they can count on the government to bail them out,” observes Barr.

“Congress already has approved money for the automakers. How long before other industries begin lining up in Washington with their hands outstretched? Congress will have no good argument to use in saying 'no,'” warns Barr.

“Finally, who will bail out Washington when the government can no longer pay its bills?" asks Barr. "What happens when the Chinese stop buying America’s debt? If Uncle Sam can’t learn to say 'no,' the entire financial house of cards will soon collapse,” Barr says.

“Congress must say 'no' more. There must be no more special interest bailouts. Fannie Mae and Freddie Mac must be privatized. There must be no more government pressure on banks to increase lending. We need oversight and transparency at the Federal Reserve. Political meddling in the economy must come to an end,” notes Barr.

“Neither the Republicans nor Democrats can be trusted to protect the taxpayers,” warns Barr. “Sen. John McCain called the bailout a ‘rescue’—a rescue of the most irresponsible and short-sighted borrowers, lenders and investors in America. This is the politics-as-usual railroad, not the Straight-Talk Express. Yet again, those who scream loudest and contribute the most money have their voices heard in Washington. Only a vote for Bob Barr and the Libertarian Party will change the Washington operates,” says Barr.

Libertarian Party presidential candidate Bob Barr represented the 7th District of Georgia in the U. S. House of Representatives from 1995 to 2003.

The Libertarian Party is America's third largest political party, founded in 1971 as an alternative to the two main political parties. You can find more information on the Libertarian Party by visiting www.LP.org. The Libertarian Party proudly stands for smaller government, lower taxes and more freedom.

Tags:
bailout, barr, US House, President Bush, US Senate

For Immediate Release
Oct 05, 2008

Economic Chaos Increases After Congress Passes Bailout

Will Sens. Obama and McCain Claim a Piece of this Rotten Fish They Helped Produce?

Congress passed the $700 billion Wall Street bailout on Friday, supported by both Senators John McCain and Barack Obama. The U.S. stock market promptly dropped. Over the weekend the financial crisis threatened European banks, and stock prices across Asia and Europe tanked.

So much for the argument that the bailout was necessary to calm the markets.

Yet, while politicians were putting the taxpayers ever more at risk, we have seen the possibilities of a market work-out. For instance, Warren Buffet invested $8 billion in investment bank Goldman Sachs and manufacturer General Electric. He imposed tough terms, but he has solidified the financial futures of those two firms.

Both Goldman and Morgan Stanley won permission to become bank holding companies, allowing them to accept deposits along with increased regulatory oversight. Last month, Bank of America spent $50 billion to acquire Merrill Lynch, which had unloaded its bad mortgage backed securities in the summer, well before Congress stepped in.

Even more dramatically, a bidding war has broken out between Citigroup, which had been tapped by the Federal Reserve to save troubled Wachovia bank, and Wells Fargo, which jumped in with an unexpected $15 billion purchase offer. The two are now battling in court over the right to buy a bank seen as financial road kill only last week.
There is much more to be done to clean up the economic mess flowing from the housing market crash, but the ill-considered federal bailout is likely to slow the process.

Companies now will run to the Treasury Department before taking tough steps to clean up their own balance sheets. After the automakers joined insurer AIG and investment bank Bear Stearns in winning their own federal bailouts, what company will not expect a handout from the taxpayer? Who will bail out Uncle Sam when all of his bills--well over $100 trillion in unfunded liabilities--come due?

Far from bringing change to Washington, the election of either Sen. Obama or McCain would mean more of the same: More political interference in the economy; more special interests running government economic policy; more taxpayer bailouts; more politics as usual.

Only a vote for Bob Barr and the Libertarian Party would offer genuine change for the future.

-Bob Barr

Originally published at the Huffington Post ...

For Immediate Release
Oct 06, 2008

Bush Administration Hypes Danger to Justify Intervention

"The Bush administration once again misled Americans into believing extreme danger was imminent and extraordinary U.S. government intervention was required to save our country," says Bob Barr, the Libertarian Party's presidential nominee. "And, once again, the intervention of the Bush administration has made things much worse."

"In 2003, the Bush administration said that if we did not act immediately in Iraq, Americans faced imminent threats, and conjured images of mushroom clouds and terror attacks," Barr explains. "Americans, trusting that our government officials knew what they were talking about, went along with the panicked calls for action, only to be bogged down in an occupation of Iraq for the last five years."

"When financial firms began feeling the impact of years of irresponsible lending, Bush, along with Senators John McCain and Barack Obama, began invoking similar apocalyptic scenarios—like the Great Depression—justifying immediate government intervention in the economy," Barr continues. "Now, taxpayers are $700 billion in the hole, and the economy is continuing its downward slide."

"No longer should Americans look to the government as the fix to today's problems," says Barr. "American voters should throw-out all of these politicians who hyped the danger and put taxpayers on the hook for what will amount to be more than a trillion dollars. No longer can we stand for an alarmist government, which approaches our problems with a quick fix rather than a reasoned solution. Bush, McCain and Obama should have taken a deep breath, and stayed out of the way as the market continues its painful adjustment process," Barr says.

"Instead, they took a bad situation and made it worse—with taxpayers picking up a huge debt," Barr says. "More government is not the answer."

"We've gone from threats of mushroom clouds and alleged vials of anthrax, to threats of massive unemployment and no credit for student loans," Barr notes. "And who is responsible for this alarmism and paranoia? Senators John McCain and Barack Obama, just to name a few people. Senators McCain and Obama are not friends to the taxpayers. They are two faces to the same problem: big government."

"It is time for a change," says Barr. "A change to keeping government small, and the taxpayers protected from the government's greedy hands. This change will not come from big-government types like Senators McCain and Obama. It will only come from outside the political establishment. Only through a vote for Bob Barr and the Libertarian Party will America return to a society with less government, fewer taxes and more individual freedom."

Libertarian Party presidential candidate Bob Barr represented the 7th District of Georgia in the U. S. House of Representatives from 1995 to 2003.

The Libertarian Party is America's third largest political party, founded in 1971 as an alternative to the two main political parties. You can find more information on the Libertarian Party by visiting www.LP.org. The Libertarian Party proudly stands for smaller government, lower taxes and more freedom.

For Immediate Release
Oct 10, 2008

Wall Street Benefits Twice from Bailouts

Senator John McCain attempted to disguise reality by calling the $700 billion Wall Street bailout a “rescue,” but it’s obvious that the only people he and his colleagues were rescuing were the executives who had made bad investment decisions, as well as the politicians who had pushed increased mortgage lending, irrespective of cost, triggering today’s crisis. Now it turns out that the companies getting bailed out will benefit twice.

Most everyone has seen the story of how executives at AIG partied at a resort after the taxpayers were stuck with the bill for an $85 billion bailout—now being supplemented with another Federal Reserve loan of $37.8 billion. But what’s $440,000, including more than $23,380 for spa services, among friends when the taxpayers are paying?

Normally politicians wouldn’t have any business complaining about the cost of a corporate retreat, but what might be unexceptional for high-flying companies in a booming economy becomes outrageous when taxpayers are getting stuck with the bill. In this case they are paying twice, with the company collecting a new loan because its bottom line is even worse than originally thought.

Loan-two to AIG is small change compared to the extra benefits that Wall Street will receive. Many of the largest firms will be going to the spa, figuratively, at least. You see, someone has to manage all of the securities and other assets that the government plans on buying with taxpayer funds. And who better to manage them than the very companies that bought the bad paper in the first place!

The Treasury Department has requested proposals for asset managers, and according to the Wall Street Journal, the government “wants large, established firms with significant assets to work for the government’s program.” That means managing at least $25 billion, and in some cases at least $100 billion, in private assets. There will be a lot of money in fees—typically 1 percent of the assets managed, which could come to as much as $7 billion a year or more if government purchases go past $700 billion, as is widely expected.

Wall Street is looking forward to milking this latest cash cow. Since government jumped into the investment business, the Journal tells us that “a range of firms—from large investment banks to boutique real-estate companies—have been angling to grab some of the advisory business.” Representatives of some companies showed up in Washington to lobby even before Congress approved the bailout. And who can blame them? The Journal reports that “sales, financing and other traditional forms of real estate business have dried up with the credit crisis.”

Of course, most of these firms helped cause that very crisis. Most of the companies bidding for government business are suffering big losses and preparing to unload lots of bad paper on the government. Bad paper that other big companies with big losses and lots of bad paper will manage.

And so the circle will go on endlessly, at taxpayer expense.

The only problem is potential conflicts of interest, since companies will, notes the Washington Post, “be managing the assets while also selling their own troubled securities to the government.” But officials say they will attempt to “minimize” any conflict. No doubt, Washington won’t let a little thing like ethics stand in the way of letting everyone on Wall Street profit.

Indeed, politics are starting even before the president’s signature on the bill is dry. One analyst predicts that the Treasury Department will focus bailout funds on regional banks and thrifts, thereby providing “critical political support for Treasury’s efforts.” After all, “Congressmen who had to swallow hard to vote for this think will feel a lot better about it if they see the impact in their local communities.” Which is just another name for pork, like the spending programs and tax preferences loaded into the $700 billion bailout bill to win votes for passage.

All of this is politics as usual in Washington, and it won’t change whether Sen. Barack Obama or Sen. John McCain is elected president. Both of them supported the $700 billion Wall Street bailout, as well as the many other bailouts that preceded it. Both of them are part of the political establishment that helped create today’s economic problems. Neither of them will take the steps necessary to ensure that this sort of economic crisis doesn’t hit again. Only Bob Barr and the Libertarian Party are offering the sort of fundamental change that the American people need and deserve.

Originally published at Townhall.com...

For Immediate Release
Oct 16, 2008

Time For Real Economic Reform

After several huge, government bailouts, and other measures placing trillions of taxpayer dollars at risk, the nation’s financial system remains far from stable. There is much more work that needs to be done before the economy will return to its growth path, but it cannot be more of the same, heavy-handed government mandates that have failed us time and again.

The ongoing financial crisis demonstrates why, first, we must limit political interference in the economy. It was sustained federal pressure to increase mortgage lending, through Freddie Mac and Fannie Mae, as well as the Community Reinvestment Act, which helped generate the huge economic bubble that just burst at great cost to every American.

Limiting political interference in the economy also requires limiting the ability of the Federal Reserve to manipulate the currency for political purposes. The Fed’s “easy money” policy over the last decade greatly contributed to an artificial increase in lending and property values. Unfortunately, it is the drop in those values which is the basis of today’s crisis. The ill-advised loosening of SEC regulations that had been in place to insure solvency and transparency in the operation of major investment firms, also contributed to the current financial crisis.

We must improve financial regulation to emphasize integrity and transparency. Many government agencies impose many regulations on the financial industry, but the quality of corporate and bank balance sheets remains unclear in too many cases. For instance, inter-bank lending has dropped because banks don’t know which banks are in trouble. We need better, more consistent regulation—not more regulation. Additionally, the laws and regulations on the books – supposed to insure integrity, transparency and soundness in financial institutions – must be enforced (as they have not been in recent years).

Government economic policies need to more effectively emphasize job creation. The best solution to unemployment is increased employment, not creating or expanding social benefits. That means permanently lowering tax rates and simplifying taxes. In contrast, cutting rates or adding credits for a couple of years offers no sustained relief or incentive for growth. Temporary, politically based fixes provide no sound basis on which companies and financial institutions are to able to make sound, long-term plans for hiring, inventory and production.

It is necessary to reform the overall tax system. Adjusting it at the edges with, for example, a deduction here or a credit there always will be less effective than lowering and simplifying overall rates. We must make the U.S. a warmer home for economic entrepreneurship and investment; not a temporary haven.

Moreover, rather than approve new bailouts, the federal government should cut regulatory burdens on hard-hit businesses. Environmental rules are noteworthy for their cost and inefficiency, for instance. It makes more sense to relax, or, better yet, end Corporate Average Fuel Economy standards on vehicles, which have imposed a huge cost burden on the auto industry, than to provide the companies with billions of dollars in loans in order to help them meet ever-increasing regulatory mandates.

Washington should carefully reconsider its regulatory strategies more broadly. Policymakers should initiate a detailed audit of federal rules, relaxing or eliminating any regulations for which costs outweigh benefits.

Fixing federal tax and regulatory policies also is necessary to improve America’s competitiveness in the global economy. The U.S. retains many advantages over other industrialized states, but has fallen well behind in tax policy. With economic turmoil at home, America cannot afford to lose its comparative advantage elsewhere.

Obviously, many of these steps will take time to implement – but we must start. And, in the short-term, government should look for ways to ease the burden on people hit hard by the current crisis. For example, Washington should reduce penalties on people for delayed tax payments and premature withdrawals from IRAs.

Policymakers also need to formally and clearly end the bailouts. This step is critical to promote private economic retrenchment and corporate work-outs. Significant financial cutbacks are painful, but inevitable. However, companies will resist taking these necessary steps if they believe they can count on a federal bailout. Distortions caused by government injecting billions of dollars into certain preferred banks and not others, only further impedes essential market based decisions by banks and other financial institutions to bring the markets back into balance.

Nonessential federal spending must be cut. With the 2008 fiscal year budge deficit close to $500 billion, and the 2009 deficit now expected to run at least $750 billion and as much as $1 trillion, we can no longer afford frivolous special interest outlays.

Over the longer term, we must deal with the mountain of future federal liabilities and obligations—FDIC bank guarantees, Pension Benefit Guaranty Corporation promises, Social Security and Medicare liabilities, and more. So far just in the past few weeks, the federal government has undertaken roughly $2 trillion in bailouts. Total unfunded liabilities for Social Security and Medicare, that is, the excess of promised benefits over expected revenues, exceeds $100 trillion -- more than 50 times as much as these recent, costly bailouts!

Still, nothing is being done to address the looming fiscal catastrophe they portend.

Although the federal government can try to bail-out everyone else, there is no one to bail-out the federal government. We won’t be able to count on the Chinese, Japanese, or anyone else to purchase our increasingly high mountain of debt.

The American people have repeatedly demonstrated their capacity to meet great challenges. The government must stop interfering with their ability to prepare for future challenges. America can and must once again lead the world in economic power and growth, through exercise of a free-market economy; not follow meekly behind the U.K. and our other European friends that for decades have been pushing our country to emulate their model of centrally-managed economies.

- Bob Barr, Libertarian Party Nominee for President

For Immediate Release
Nov 02, 2008

At Last, an Investigation

by Libertarian Party Presidential Nominee Bob Barr

Federal authorities have announced that they are opening an investigation into the collapse of Washington Mutual, the largest bank failure in America. This step is long overdue, and should be the start of a much broader investigation of potential criminal behavior throughout the financial system.

I have been calling for such an investigation since the financial crisis broke publicly. It is heartening to see at least two U.S. Attorneys, as well as the Attorney General of New York, take their responsibilities seriously.

While much of the blame for the current turmoil in our housing and financial markets can be blamed on bad policies advocated by the current and prior administrations, and the current and prior congresses, there appears to have been massive fraud and other misbehavior in the deliberate overvaluing of mortgage-backed assets, reinforced by the failure of ratings agencies to do their jobs. Well-connected VIPs and derivatives traders made money at the expense of common investors and the public. Yet the authorities so far have done little to bring those responsible to account. Markets must be carefully policed to detect and punish fraud and other criminal behavior.

Rather than ensure transparency and enforce laws and regulations to protect financial integrity, public officials manipulated the system to put more people into homes regardless of their ability to pay in order to win political support.

In particular, Congress pushed banks, like Washington Mutual, to make more and riskier loans to people with poorer credit histories. There was pervasive misuse of Fannie Mae and Freddie Mac by politicians, some of who have been leading efforts to stabilize the financial system. Even when problems became evident and analysts began raising the alarm, these same irresponsible politicians killed every attempt to limit taxpayer exposure to bad lending.

Once the entire house of cards collapsed, the Bush administration and Congress, supported by both Senators John McCain and Barack Obama, rushed to put trillions of dollars of taxpayer funds at risk to bail out Wall Street, the housing industry, banks, insurance companies, and many others—who did so much to create the current crisis. Instead, the administration and Congress should have been investigating financial fraud, developing targeted measures to restore financial transparency and encourage normal lending activity, and reforming laws and regulations which failed to protect investors.

Having unnecessarily put the taxpayers at risk, it is critical that Congress and the Justice Department ensure tough oversight of the trillion-dollar-plus bailout program.

Already the Bush administration has engaged in bait and switch, promising to use the money to buy up bad securities, but instead using it to buy stakes in leading banks, which is itself bad policy and bad economics. That much money is an obvious target for fraud and corruption as well as bad faith. Prosecutors must keep investigators on alert and indictments at the ready to ensure that criminals do not fleece the taxpayers as they have been by politicians.

We must act quickly to restore integrity to the financial marketplace by enforcing laws and regulations against fraud and other misbehavior. We also must correct policies that led to Wall Street’s debacle. Congress must rein in the Federal Reserve, since the latter’s ‘easy money’ policy helped create the housing bubble that just popped. Fannie Mae and Freddie Mac must be privatized and Congress must end its interference in the lending markets.

Politicians, as much as Wall Street traders, were responsible for the current mess. The people must hold elected officials accountable.

When government is the problem, more government is not the answer. And when the same politicians who created the mess are reelected to office time and time again, there is little hope that these same people will resolve our problems. True change—not that of which Barack Obama has been championing—will only come from electing officials who have committed to reducing the size of government and its intervention in the economy.

Even just a few days before the election, neither Sen. John McCain nor Sen. Barack Obama has fully committed to keeping the government out of the economy. Both support the same policies of government intervention that created the financial crisis in the first place.

Americans cannot afford more big-government fixes for today's problems. Americans cannot afford Senators John McCain or Barack Obama.