By Rep. Mike Turner (R, OH-03)
I voted against both the $700 billion in TARP funding last October and the $800 billion economic stimulus in February. I opposed both because I felt they were poorly considered, did nothing to help those who lost their homes and jobs, and lacked specifics to show how these huge taxpayer investments would be spent. The nation is now racking up an enormous budget deficit and adding trillions to the national debt as a result of these hastily-passed spending plans.
As the Administration continues its investment in banks and major corporations under the guise of mitigating risk to the economy, there appears to be no mechanism in place to hold the government accountable or slow its advance into private enterprise. The government has already gone beyond the original intent of Congress’s authorization of funds for the Troubled Asset Relief Program (TARP) last October. Instead of using the funds to purchase so-called toxic assets from financial institutions, the government has plunged headlong into buying preferred stock in hundreds of banks and has even become the majority shareholder of one of the country’s largest automakers.
That is why last week I introduced legislation in the U.S. House calling for a constitutional amendment to prohibit the government from buying stock or equity in corporations. This action is necessary to address the federal government’s deepening involvement in the nation’s private industry and financial sector and its failure to present an exit strategy.
While the government should have a role in regulating business to ensure fair practices and consumer protection, government ownership of business, even with good intentions, crosses the line. Despite the Administration’s statements that it would not seek to exercise undue influence over the operations of the companies in which it has invested, the government has set compensation levels for employees and fired CEOs.
The American public and many in Congress are becoming more concerned about the long-term potential of government control of our private sector businesses. I believe that the most effective method to prevent government intrusion and manipulation of the private sector is through a constitutional amendment.
Joined by 102 original congressional cosponsors, last week, I introduced, H.J. Res 57, the “Preserving Capitalism in America Amendment.” The proposed amendment would prohibit federal government acquisition of any stock or equity interests in corporations. It preserves the government’s right to provide loans to, or acquire equity interests in, any public authority corporation, public use corporation, or investments by any government pension fund.
This legislation, which seeks to focus a spotlight on the federal government’s overreaching into the private sector, comes just days after the Administration announced a sweeping overhaul of the financial industry. In addition to adding further layers of government control over the financial industry, the new government plan would also expand the Federal Reserve’s ability to control financial institutions that it deems pose a risk to the market. Again, the government would continue to pick winners and losers with no indication of any end to this process.
It’s ironic that government overreaching in the name of saving our economy could ultimately undermine the strength of our private enterprise system. The Preserving Capitalism in America Amendment is needed to provide constitutional protection to American free enterprise.