Americorps

Federal Government Wastes Millions on Vacant, Run-Down Buildings, Including a Pink Monkey House

by Hans Bader on September 2, 2010 · 1 comment

in Economy, Legal, Politics as Usual, Sanctimony, Stimulus to Nowhere, Zeitgeist

The Department of Veterans Affairs is spending millions annually on 314 run-down, vacant buildings, including a pink monkey house. “The buildings are home to rats, lead paint, wall-to-wall fungal growth, mold, radon, and spare tires,” notes the Washington Examiner.

“Billions of stimulus dollars have been wasted on programs” highlighted by Citizens Against Government Waste, such as “$554,763 for new windows in a visitor’s center that closed in 2007 in Washington. In several instances, stimulus spending has actually reduced private sector employment; in Normandy Park, Washington, $3.8 million was spent on a ‘streetscaping’ project that drove customers away from local businesses, causing a local restaurant to fire two employees.”

As noted earlier, money from the stimulus package is being wasted on things such as “Saturday night ‘pervert’ revues.”   “Join your fellow pervs for some explicit, twisted fun,” urged one  recipient of stimulus money.

Earlier, Obama fired an inspector general, Gerald Walpin, who uncovered fraud by an Obama supporter in the federal AmeriCorps program, whose budget Obama has massively increased.  AmeriCorps money has been wasted in the past on ideological causes, like paying young people to lobby for rent control.

Obama Fires Inspector General Who Uncovered Fraud, and Honors Defrauder Instead

by Hans Bader on June 11, 2010

in Economy, Employment, Energy, Environment, Legal, Nanny State, Personal Liberty, Politics as Usual, Sanctimony, Stimulus to Nowhere, Trade, Zeitgeist

Earlier, President Obama fired the inspector general for the AmeriCorps program after he uncovered fraud by Obama crony Kevin Johnson.  (Johnson did not receive even a slap on the wrist for his fraud; an organization Johnson ran was required to pay $350,000, but it never did so because it was insolvent; and Johnson himself was not ordered by the Obama administration to pay anything.)

Now, the Obama administration is honoring Johnson despite his fraud, inviting him to be a featured speaker at an event for AmeriCorps, the program Johnson defrauded.

The Obama administration fired the inspector general who uncovered the fraud, Gerald Walpin, falsely claiming he was a senile right-winger, even though Walpin was a successful lawyer with recent high-profile court victories who had uncovered millions in fraud against taxpayers, and even though Walpin, a northeastern moderate Republican, was sufficiently non-partisan that he endorsed Obama’s Supreme Court nominee, Sonia Sotomayor.  (The Obama administration even trumpeted Walpin’s endorsement of Sotomayor to push her nomination.)

“How ACORN Destroyed the Housing Market”

by Hans Bader on November 16, 2009

in Bailout Watch, Economy, Legal, Personal Liberty, Politics as Usual, Precaution & Risk, Sanctimony

Federal affordable-housing mandates were a major factor in the mortgage crisis, fueling the housing bubble and the subsequent collapse of the housing and financial markets, which helped bring down the economy.  Even the liberal Village Voice has admitted that.  Who drafted those awful mandates?  ACORN, reports the Washington Examiner, in “How ACORN Destroyed the Housing Market.”

How did ACORN cause the “housing bubble” and “financial collapse”?  ACORN lobbyists drafted “affordable-housing” mandates to pressure the mortgage giants to buy up more risky loans and mortgages from low-income communities, loans that banks in turn were pressured to make by the Community Reinvestment Act, explains The Wall Street Journal.

ACORN also helped spawn the mortgage crisis by promoting “liar loans.”   It has a long history of  financial fraud, vote fraud, tax evasion, waste, and mismanagement.

Lawmakers and the Obama administration have studiously ignored ACORN’s role in spawning the financial crisis, because many liberal lawmakers have long had close ties to ACORN.  ACORN is a left-wing group that launched Obama’s career as a community organizer.  (ACORN stands for Association of Community Organizations for Reform Now.)  Obama has long-standing ties to ACORN, and an ACORN affiliate received received $800,000 from Obama’s campaign.

In recent months, lawmakers distanced themselves from ACORN, and cut off its federal housing funds, after it was caught on videotape in a child prostitution promotion scandal.  (ACORN is now suing the federal government in court, to force it to resume funding ACORN.  Earlier, it sued the private citizens who exposed its role in the scandal for $2 million).

However, in the long run, ACORN is likely to continue to benefit from its close ties to liberal lawmakers and the administration.  Entities related to ACORN stand to reap millions from Obama’s financial regulation proposals and health-care reform proposals.

Meanwhile, the Obama administration is busy promoting the junky, risky mortgages that fueled the housing bubble, showing that it has learned nothing from history.  One result is that the Federal Housing Administration, which is making many such loans, has gone into a “nose dive” and may need a multibillion-dollar taxpayer bailout, reports the Washington Post.

Obama wants to create a bureaucracy called the Consumer Financial Protection Agency. “The agency would be in charge of enforcing the Community Reinvestment Act, a law that prods banks to make loans in low-income communities.” The Community Reinvestment Act was a key contributor to the financial crisis.  Yet Obama’s plan would empower the CFPA to enforce the Community Reinvestment Act without regard for banks’ financial safety and soundness.

The mortgage crisis was also caused by the reckless government-sponsored mortgage giants (”GSEs”) Fannie Mae and Freddie Mac, and by federal affordable-housing mandates.

But Obama’s proposed financial rules overhaul does absolutely nothing about Fannie Mae and Freddie Mac, admits Obama’s Treasury Secretary, tax cheat Timothy Geithner, even though he admits that “Fannie and Freddie were a core part of what went wrong in our system.”

Worse, Obama’s plan is “largely the product of extensive conversations” with two lawmakers responsible for the corrupt status quo, Chris Dodd and Barney Frank, and it expands the reach of regulations that have been used by left-wing groups to extort pay-offs from banks.

Recently, the administration got rid of the inspector general for Fannie Mae and Freddie Mac, after making Freddie Mac run up $30 billion in losses from the Obama administration’s mortgage bailouts, which bailed out even high-income borrowers who irresponsibly mismanaged their finances.  Earlier, Obama fired an inspector general, Gerald Walpin, who uncovered misuse of funds by a prominent Obama backer, smearing the inspector general with allegations that turned out to be false.

Stimulus Packages Don’t Work; Obama’s $800 Billion Stimulus Will Shrink the Economy

by Hans Bader on October 1, 2009

in Economy, International, Labor, Legal, Politics as Usual, Sanctimony, Stimulus to Nowhere, Trade

“Stimulus” packages that increase government spending don’t work, notes Harvard economist Robert J. Barro in the Wall Street Journal.

The administration claimed that Obama’s $800 billion stimulus package would deliver a short-run “jolt” that would quickly lift the economy, but unemployment rose rapidly after its passage, and the package has actually destroyed thousands of jobs in America’s export sector.

Countries that refused to adopt big stimulus packages have fared better than those that imitated Obama. And the biggest-spending countries have suffered worse in the recession.

Obama claimed his stimulus package was needed to prevent the economy from falling into an “irreversible decline,” but the Congressional Budget Office repeatedly admitted that the stimulus package will shrink the economy “in the long run.” The stimulus package subsidized lots of government waste and corruption.

Obama’s welfare-filled stimulus package largely repealed welfare reform.  That will result in lower employment and a smaller economy over the long run.

Earlier this year, Obama fired an inspector general, Gerald Walpin, who uncovered waste and fraud in the AmeriCorps program, including by a prominent Obama supporter, affecting his access to stimulus money.

The stimulus package imposes on state governments wasteful racial set-asides and union-backed prevailing-wage requirements. The prevailing-wage requirements will cost $17 billion. Racial set-asides are very costly.

Economies are like children: they naturally grow, unless they are subjected to especially severe abuse and neglect by the government.  So the U.S. economy will turn around by November 2010, despite Obama’s economic mismanagement and wasteful spending.

But long-run economic growth is likely to be much slower thanks to his harmful economic policies, which will massively increase the national debt even while raising taxes.

More Government Waste, Corruption, and Corporate Welfare, Thanks to the Obama Administration

by Hans Bader on June 14, 2009

in Odds & Ends

Rapidly-rising Medicare spending already threatens “to crush the federal budget,” and much Medicare spending is wasteful, yet the Obama Administration claims it can somehow save money by creating Medicare-like programs to cover all Americans. In the New York Times, economics professor Tyler Cowan calls it “the new voodoo economics.” Washington Post columnist Robert Samuelson concludes that Obama’s health-care plan “is naive, hypocritical or simply dishonest. Probably all three.”

Obama is firing an inspector general who exposed wrongdoing by one of his supporters, and previously uncovered millions of dollars in waste and fraud in the troubled AmeriCorps program, whose budget is being dramatically increased by the Obama Administration. Inspector General Gerald Walpin was fired after he uncovered misuse of Americorps funds and sought to keep the wrongdoer from accessing federal “stimulus money.” The recently-passed stimulus package repealed welfare reform, and it subsidizes waste and corruption.

Congress is moving towards passing a “cash for clunkers” bill that would give people tax credits, but only if they own an old gas-guzzler that they are trading in for a new car. So if you bought a fuel-efficient car in the past, your tax dollars will be used for welfare for people who bought inefficient cars (cars with less than 18 MPG). The bill will increase the national debt (and thus future taxes) by billions of dollars. As Mike Budnick notes in the Wall Street Journal, “This type of legislation rewards people who have made poor decisions and penalizes only people who have already made good choices. Not the kind of incentive that we should propagate. Let the market work.”

Taxpayers are being ripped off to the tune of hundreds of billions of dollars to enrich wealthy buyers of so-called “toxic assets.” Meanwhile, the Obama Administration’s $787 billion stimulus package is actually killing jobs and shrinking the economy.

Congress passed an FDA tobacco regulation bill, but not without adding insidious provisions that will reduce competition in the tobacco industry, and actually make it harder to introduce products that reduce the harms and health risks of tobacco, notes the Wall Street Journal. We earlier described the bill’s pitfalls and counterproductive provisions. Obama has said he will sign the bill into law.

Billions of tax dollars are being spent on bailing out carmakers, but the primary beneficiaries of this corporate welfare are not the car companies themselves, which could have survived without federal bailouts by simply abrogating their collective bargaining agreements and dealer-contracts in a standard bankruptcy-court reorganization, but the United Auto Workers Union, which spent millions electing Obama and is now calling the shots. Taxpayers and pension funds are being ripped off to enrich the UAW, which enjoys wages much higher than the average American.

A similar government bailout of the auto industry actually backfired in England in the 1970s, destroying its carmakers by leaving them with excessive wages, inefficiency, and political meddling in car design.

Now, even liberal commentators are questioning whether the mushrooming auto bailouts pass constitutional muster, such as Charles Lane in today’s Washington Post. (Lane is so liberal and pro-government that in a front page article in 2003, he characterized the Supreme Court’s 2003 decisions as collectively being great for “civil liberties,” even though he admitted that the Supreme Court had rejected free speech claims in 7 out of its 8 First Amendment cases that term, largely because Lane approved of its decision upholding the University of Michigan Law School’s race-based affirmative action plan — even though legally permissible affirmative-action plans are a discretionary government function, not an individual right or civil-liberty).

Conservative columnist George Will also has a column today criticizing the auto bailouts. He points out that the Administration’s current claim that it can use TARP bank-bailout money for an auto bailout is at odds with the Treasury Department’s past admissions to the contrary: “Last September, Treasury Secretary Henry Paulson testified to the Senate that TARP money was necessary for ailing ‘financial institutions.’ Nowhere in the bill’s 169 pages was there any reference to government funding of ‘automobile’ or ‘manufacturing’ companies. In November, Paulson told a House committee: ‘I’ve said to you very clearly that I believe that the auto companies fall outside of [TARP's] purpose.’”

Earlier, commentators like the Heritage Foundation, Clinton Administration Labor Secretary Robert Reich, and liberal journalist Andrew Sullivan all agreed that the auto bailouts are illegal or unconstitutional.

In Cover-Up, Obama Fires Inspector General to Shield Crony and Waste Taxpayer Money

by Hans Bader on June 12, 2009 · 1 comment

in Employment, Legal, Politics as Usual

Obama is firing an inspector general, Gerald Walpin, who uncovered wrongdoing by a prominent Obama supporter and opposed letting him off the hook.

Ironically, when Obama recently nominated a liberal judge to the Supreme Court, his Administration trumpeted Walpin’s support for her.

Walpin is the Inspector General for the Americorps program, which is riddled with waste, fraud, and ideological misuse of taxpayer funds. Walpin “has been doing a good job” and he has “identified millions of dollars in AmeriCorps funds that were wasted or misspent,” notes Senator Grassley.

But when Walpin recently exposed wrongdoing by a prominent Obama supporter, Kevin Johnson, Obama moved to fire Walpin. Walpin protested the Administration’s failure to hold Johnson, a liberal mayor, accountable for using taxpayer money to pay for “political activities” and pay volunteers to run “personal errands for” Johnson “and even wash his car.”

Obama staffers and supporters are now falsely claiming that Walpin, whom the Obama Administration recently quoted as an authority (given his stature as a highly-respected former federal prosecutor and big-name law firm partner with clients across the political spectrum), is a right-wing nut (a ridiculous claim).

Walpin notes that although he uncovered massive wrongdoing by Johnson, it has led only to a sham settlement: $350,000 that is supposed to be paid back to the taxpayers never will be, since the entity that Johnson used to receive taxpayer money and spend it on himself now “is insolvent,” and its “settlement agreement was carefully drafted so that no obligation is imposed on” Johnson for that money, only the defunct entity he controlled. That’s so even though it was Johnson who used Americorps money to pay volunteers to “wash his car” and run “personal errands” for him.

Obama to Sign $6 Billion National Service Boondoggle; Mandatory Service Mulled

by Hans Bader on April 21, 2009 · 1 comment

in Bailout Watch, Economy, Nanny State, Politics as Usual, Stimulus to Nowhere

President Obama will sign into law a $6 billion “national service” boondoggle. In the March 31 Washington Examiner, I described how the “Americorps plan will waste money on ideological causes” like rent control and more lenient sentences for violent criminals:

“Despite exploding deficits, President Obama and congressional leaders are backing a $5.7 billion “national service” boondoggle. Obama’s proposed budgets, which break his campaign promise of ‘a net spending cut,’ will already increase the national debt by $9.3 trillion, according to the Congressional Budget Office (CBO), making even the Bush administration look thrifty by comparison. Where will the new money come from? The CBO says Obama’s $800 billion stimulus package will actually shrink the economy ‘in the long run.’ Much of the ‘national service’ funds will be wasted on ideological causes. In the past, they were used to pay young people to lobby for rent control and against anti-crime legislation, such as ‘three-strikes’ laws.”

This $6 billion may be just the beginning. In 2008, Obama promised “a civilian national security force that’s just as powerful, just as strong, just as well-funded” as our military.

Soon after the election, Obama’s web site announced plans to require students to perform unpaid community service every year. “Obama will call on citizens of all ages to serve America, by developing a plan to require 50 hours of community service in middle school and high school and 100 hours of community service in college every year,” announced Obama’s change.gov web page. Community organizers would no doubt welcome all the unpaid labor this makes available to them.

It is unclear if any federal power authorizes such a requirement: the Supreme Court’s decision in United States v. Lopez (1995), which struck down the Gun-Free School Zones Act as unconstitutional, made clear that private citizens and education are not inherently commercial enterprises subject to federal regulation under the Commerce Clause. (That decision was reaffirmed in United States v. Morrison (2000), which dismissed a federal lawsuit alleging violence between college students, as beyond federal jurisdiction).

My guess is that Obama will try to get around those decisions by conditioning federal grants to school districts on their mandating unpaid service by students. (The Supreme Court hasn’t struck down a spending-condition since United States v. Butler (1936)). Prior to the election, Obama supporters also spoke of sweetening the pot for college students (but not other students) by giving them a tax-credit in exchange for the community service.

The Obama Administration has temporarily put these plans for mandatory service on the back-burner.

Legal commentator Walter Olson of Overlawyered writes that after he publicized the Obama community-service requirement, and his post “began drawing thousands of visitors, the Obama website administrators at change.gov silently replaced the ‘require’ language with something new and different: ‘Obama will call on citizens of all ages to serve America, by setting a goal that all middle school and high school students do 50 hours of community service a year and by developing a plan so that all college students who conduct 100 hours of community service receive a universal and fully refundable tax credit ensuring that the first $4,000 of their college education is completely free.’”