Thursday, October 2, 2008

Response from Fallin

Since the House is supposed to be voting on the Senate's version of the bail-out by Friday, I thought I'd send my Congressperson, Mary Fallin, a reminder that my preference is for her to vote "no".

As I was perusing this week's Objectivist Round Up at The Crucible and Column this morning, I noticed Kendall J's post on the bail-out, "Why Paulson's Money is No Good", which struck me as laying out the essentials of the situation in a fairly clear and straightforward manner, and thought I'd send it along to Ms. Fallin.

I included the following note:

Congresswoman Fallin,

I am writing to you once again to ask that you vote no on the bail-out.

I am including the following to help you understand my reasons. Please note especially point 5:

In the seizure of WaMu, Treasury seized the company and by fiat destroyed all contractual priorities set forth in the capital structure. This act alone has exacerbated the liquidity problem because now any potential lender to a distressed bank risks losing his entire investment regardless of pre-negotiated terms, to arbitrary exercise of force. Henry Paulson's money comes paired with the potential for wholesale rights violations.

The use of government to attempt this function necessitates rights violations, spends money indiscriminately, and preserves the structures which created the panic at taxpayers expense. The proposed bail-out illustrates perfectly the concept of chasing bad money with good. Voluntary action by the free market instead "cleans house". It cannot be otherwise, no matter how well-intentioned the government.
Consider also that Japan once tried something similar and suffered 15 years of stagnation as a result.

Rob Abiera
Oklahoma City
I don't know whether she was responding to the email I sent her on Tuesday, or to this one, but less than an hour later (!!!!!!!!) I received the following:
October 2, 2008

Mr. Rob Abiera

Dear Mr. Abiera:

Thank you for contacting me about ongoing efforts to confront the crisis in our financial system. I share your deep concerns over this crisis. First, rest assured that Congress and the administration are continuing to work to develop legislation that will be both effective and prudent - and I am working with my colleagues in the House to that end. Our goal is to craft a bill that addresses both the immediate crisis and assures stability and responsibility in the out years. It is also absolutely vital that this legislation protects the taxpayers.

After much deliberation, I voted against the initial bill presented to the House on Monday, September 29. I felt - as did 227 other representatives from both parties - that the bill contained serious flaws and that it failed to shield taxpayers from being placed in a position of underwriting a massive bailout of organizations that had acted unwisely and irresponsibly. Our goal should not be a bailout; it needs to focus on a productive workout, plus reforms that will prevent such a crisis from happening again. As your representative, I cannot in good conscience sign a blank check without appropriate safeguards and assurances that those funds will return to the treasury once the crisis has passed.

In the end I agreed with the overwhelming majority of Fifth District residents who contacted me to express their views. They believe that government has a duty to act, but not at the expense of basic principles like common-sense financial discipline and individual responsibility. Our work is not yet done here in Washington, but I am confident we will be able to craft a bill that protects taxpayer interests and preserves the fiscal integrity and continued freedom of our financial markets.

Mary Fallin
Member of Congress
Which strikes me as being code for "I know I voted 'no' before, but this time I'm going to vote 'yes'. Please re-elect me, anyway?"

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