“Congress is only adding to the national debt, now totaling $10.7 trillion,” said Wilson. “And they do so knowing full well that the money to pay for their extravagant spending spree needs to be borrowed from elsewhere.”

The national debt of $10.7 trillion includes $4.3 trillion owed in the form of unfunded obligations to Social Security, Medicare, and other commitments, and $6.4 trillion held privately, $3 trillion of which is held overseas.

Forty percent of the debt held privately comes due this year, and most economists agree that the only way for the government to pay it is to borrow more money.

“The problems with the economy started in large part because of government excesses: too much credit, too much borrowing, too much spending, and too much debt,” Wilson said. “Only a madman would now suggest that borrowed money on this sort of scale—which needs to be paid back—would provide any long-term economic stimulus,” Wilson added.

“Instead, because of this $819 billion boondoggle, paying down the national debt will eat up an ever-larger share of the overall economy in the years to come, diverting capital from creating new jobs and enterprises,” Wilson explained.

“And, instead of fixing the problems government created, the House has now voted to make things worse by adding another $1.2 trillion to the debt when interest and other considerations are calculated,” Wilson noted.

The House voted 244 in favor, and 188 against.

Wilson believes that extraordinary government interventions to date have discouraged savings, investment, and capital creation. According to the Congressional Budget Office, even without the $819 billion spending bill, the federal deficit will rise to $1.2 trillion, or 8.3 percent of GDP, in 2009, an all-time high.

“Markets will not recover any time soon unless the government generates a real plan to pay off the debt and get rid of wasteful spending,” said Wilson.

“Instead, the House voted to increase the deficit, increase all of our children’s and grandchildren’s financial burden, increase future interest rates and taxes, and once again shackle the American taxpayer to a mountain of debt,” Wilson concluded.

# # #

“Congress is running the serious risk that the United States will default on the national debt, now nearly $10.7 trillion,” said Wilson. “Today’s bill will only add to it, and the nation’s creditors overseas may be unable to continue funding our unsustainable government spending.”

The national debt of $10.7 trillion includes $4.3 trillion owed in the form of unfunded obligations to Social Security, Medicare, and other commitments, and $6.4 trillion held privately, $3 trillion of which is held overseas.

40 percent of the debt held privately comes due this year, and the only way for the government to pay it is to borrow more money.

“The current economic downturn was caused in large part because of government policies: easy credit and loose dollar policy by the Fed, the government sponsored enterprises Fannie Mae and Freddie Mac pushed loans on those who could not afford them, and the trillions of dollars of bailouts to date have only made it worse,” Wilson said.

“Now, government returns to the scene once again, not to fix the problems it created, but to exacerbate them by adding another $1.2 trillion to the debt when interest and other considerations are calculated,” Wilson added.

Wilson believes that extraordinary government interventions to date have completely spooked markets and discouraged savings, investment, and capital creation.

“The United States will not be able to get off the road to serfdom until the government actually constructs a plan to retire the debt and put an end to big government programs that hinder economic growth,” said Wilson.

Wilson warns of hyperinflation should creditors stop lending to the United States and the nation therefore defaults on the national debt.

“This is a catastrophe waiting to happen,” Wilson warned.

“Right now, countries overseas are trading real goods for paper. But that trend will reverse should the U.S. default, because a run on the dollar will ensue rapidly. Those dollars will come back home, and the people here will want to turn those dollars into real goods, but there will be too many dollars chasing too few goods,” Wilson explained.

“That’s the perfect recipe for hyperinflation. Prices would soar, and the economy would be wrecked,” Wilson added. “America would no longer be an economic superpower.”

“This must not come to pass. Congress must stop the madness by voting ‘no’ on the so-called ‘stimulus,’” Wilson concluded.

# # #

“The Treasury and Federal Reserve have failed to accurately and satisfactorily account for the first $350 billion that has been disbursed. And Congress cannot with confidence now release the rest of the funds with no strings attached,” said Wilson.

A joint letter sent by 26 free market and limited government organizations today, which Wilson signed, also called upon Congress to pass a TARP disapproval resolution “to preserve some of the taxpayers’ assets and… spend the necessary time studying the underlying causes of the economic down-turn…”

The letter criticizes the Troubled Asset Relief Program’s execution by the Treasury. “The stated purpose of the TARP was to purchase toxic mortgage assets,” the letter reads. “Secretary Paulson abandoned this concept immediately after the signing ceremony. The TARP was also designed to reintroduce the flow of credit into the market and help stabilize Wall Street. To date, neither has been accomplished.”

Wilson believes that too easy credit and loose dollar policies, combined with too low interest rates and a desire by policymakers to give loans to those who could not afford to repay them caused the credit crisis originally.

“It was government that created the problems facing the economy today by creating asset bubbles that, once they popped, endangered the very survival of the financial system,” Wilson said.

Wilson also believes that government actions in response to the economic crisis have been based on flawed premises.

“Since the downturn began, more than $8 trillion has been pledged by government to prop up the economy, and yet, unemployment is rising and likely to rise well into this year, and government has done nothing to reform the policies that led to the crisis in the first place,” said Wilson.

“Instead, Fannie Mae and Freddie Mac were nationalized, as was AIG, the auto industry, the banks and other financial institutions, and the national debt has exploded to over $10 trillion, with no end in sight,” he added.

The letter from 26 conservative and limited government leaders criticizes Treasury Secretary Henry Paulson as having “invaded the free market, propping up some companies to the detriment of others and purchasing stock in banks without requiring accountability or transparency about the use of taxpayer funds.”

“It is up to the incoming Administration to, as the letter states, to provide ‘an accounting and detailed explanation on how the initial TARP funds have been used and the prospect of a taxpayer recovery of these funds,” said Wilson.

“Until then, if they cannot account for the last $350 billion, there is no way Congress should release the next $350 billion,” Wilson concluded.

# # #

“The House Democratic caucus has chosen to serve Nancy Pelosi over the people in their own districts by voting for rules changes that have but one intent: to gag the House Republican Minority and reduce it to the relative status of abject acquiescence no matter what shenanigans the Majority decides to pull,” said Wilson.

Included in the rules changes were the repeal of the “motion to recommit” that allowed the Minority to offer alternatives to controversial legislation and the elimination of the six-year term limit for committee chairs.

The vote was 242 in favor and 181 against.

The elimination of the “motion to recommit” was condemned by legislative watchdogs across the country as a defeat for the nation’s two-party system.

“Unfortunately for all Americans, Nancy Pelosi and House Democrats have decided to silence the House Minority from offering any alternative to the unpopular legislation that is certain to be thrust down everyone’s throat in the coming session: budget-busting national healthcare, cap-and-trade, draconian tax increases, and more bailouts for the Majority’s favored industries,” said Wilson.

“Without any legislative alternatives, the American people will not be presented with any choice but to continue down the road to serfdom,” Wilson added.

Wilson also condemned the repeal of committee chair term limits.

“In 1995, when Republicans came into power, they enacted term limits for committee chairs to put an end to an era when chairs were serving for decades,” said Wilson. “Now, it is clear that Congressional Democrats wish to simply solidify their holds on power and merely serve themselves.”

Wilson called on residents in districts across the country to express their displeasure to their representatives’ office.

“Nancy Pelosi and the House Democrats deserves nothing but scorn for deliberately undermining the spirit and the letter of the two-party system that has served our democracy so well,” he said, adding, “They obviously only think we need one party. And that’s a bitter recipe for totalitarian rule.”

# # #

Wilson’s call came in a letter to the Secretary hand delivered on Tuesday, December 30th. In the letter, the ALG executive warned that the announced union/environmentalist action directly violates Employment Retirement Income Security Act (ERISA) provisions by draining working pension funds to wage a political war on global warming. The letter specifically cites the Investor Network on Climate Risk (INCR) as culpable in what he terms an “elaborate shell game.”

The INCR’s global warming Action Plan has 49 signers, including leaders of pension funds, union officials, state treasurers, state and city comptrollers, financial service firms, asset managers, and foundations. Included among the signatories are Andrew Stern, President of Service Employees International Union, and Bruce Raynor, President of UNITE HERE, together representing over 2 million workers and retirees nationwide.

“Union officials are putting the retirement security of workers at grave risk to pursue a dubious political agenda. This is more than irresponsible, it may in fact be a crime in violation of ERISA,” said Wilson.

ERISA explicitly limits the investment of worker pension funds to the “exclusive purpose of providing benefits to participants and their beneficiaries; defraying reasonable expenses of administering the plan.” Dating back to December of 2007, the Department of Labor has repeatedly informed union officials that it rejects “a construction of ERISA which would rend the Act’s tight limits on the use of plan assets illusory, and which would permit plan fiduciaries to tap into ERISA trusts to promote myriad public policy preferences ….”

Wilson’s letter to Secretary Chao calls upon the Department of Labor to ensure that the union/environmentalist coalition properly acts in the best interests of participants and beneficiaries under the plan. It states, “We urge you to take the actions necessary to ensure the fiduciaries within your jurisdiction are complying with ERISA… and are investing solely for the benefit of the participants and beneficiaries of their plans.”

Wilson noted that that the success of the investment strategy, by its own admission, is actually necessarily tied to restrictions in carbon emissions that the federal and state governments have yet to enact, thus posing greater uncertainty and risk to investors.

“The INCR with its Big Labor and state participants create the very financial risks to investors its own action plan portends to reduce,” said Wilson in a statement. “In the process, it is putting the retirement savings and investments of thousands of investors, workers, and retirees in jeopardy by tying financial returns to projected government actions that have not yet taken place, and to a disputed science that may not be factual.”

The union/environmentalist plan ostensibly seeks to “reduce climate risks” in investor portfolios by requiring investments to consider climate risk, investing capital in “developing and deploying clean technologies”, reducing by 20 percent energy use in real estate portfolios, and to support policy actions to enact a “mandatory national policy to contain and reduce national greenhouse gas emissions economy-wide, making sizable, sensible, long-term cuts in accordance with the 60-90% reductions below 1990 levels by 2050 that scientists and climate models suggest are urgently needed to avoid the worst and most costly impacts from climate change.”

Wilson contends that “reducing climate risk” is not the real intention of the investment plan, nor should it be allowed even if it were. “This amounts to an elaborate shell game to reduce carbon emissions by endangering retirements,” he said.

“All of which has nothing to do with protecting the savings of investors from risk to their portfolios,” Wilson added.

Wilson warned that left unchecked, “[t]his green-union pension raid will not only endanger workers’ retirement benefits, but the greater economy. The American people have yet to seriously question the cost of going green.”

# # #

There is a growing consensus in the Republican caucus against the bill. Top Capitol Hill sources suggest that the votes simply are not there to get the $15 billion in emergency loans to Ford, Chrysler and GM passed before year’s end.

“It’s about time that the Senate stood against the bailout madness that has permeated Washington this year,” said Wilson in a statement. “These Senators are heroes for fighting against this bill.”

“The American taxpayer cannot and must not be forced to perpetuate the mismanagement of the Big Three by financing failure. There is no excuse for putting taxpayers on the hook for keeping failed companies afloat that could much better be reorganized under normal Chapter 11 bankruptcy,” Wilson added.

Under Chapter 11 bankruptcy protection, companies have the ability to broadly restructure the scope of operations, redo labor contracts, and otherwise scale back in order to emerge from bankruptcy with a profitable business model.

“Everything that Congress says it is attempting to do, to create a deal to reorganize these companies, to return them to profitability, is precisely the purpose of Chapter 11 bankruptcy protection. The $15 billion bailout is just a reason not to go into Chapter 11. In fact, the real intention is to perpetuate bad management and Big Labor excesses at taxpayer expense,” said Wilson.

Wilson also suggested that a “structured” bankruptcy deal that has been floated in the media is just another excuse not to reopen labor contracts, “The Senators shilling for this bailout will stop at nothing to prevent normal Chapter 11 proceedings from occurring, because then the labor contracts would have to be reopened, management might be fired, etc.”

“Anything else that is being put forth by the companies or by Congress is just spin to mask this truth,” added Wilson.

The automakers have suggested that American consumers will not want to buy cars from companies undergoing bankruptcy proceedings. “That is just false,” responded Wilson. “The people are not buying the cars now, which is why they’re in this mess.”

Wilson believes that without bankruptcy, the companies are doomed to failure. “The real question everyone should be asking is, ‘Who is going to want to invest in a company that has to beg the government for loans that cannot be paid back every few months just to keep up its excessive operations?’”

“If these companies really are in that much trouble, then bankruptcy is their only option,” said Wilson.

“The American people owe a debt of gratitude to Senators Ensign, Coburn, DeMint, Vitter and Shelby for their courageous, principled stand. Any Senator who votes for this bailout will have to answer to their constituents and history for their destructive action,” Wilson added.

###

The letter, with 18 signatories from the heads of movement conservative, limited government, and free market organizations to every member of Congress, called upon members to reject the automakers’ request for new government loans to stay afloat. It, instead, urged members to encourage the automakers’ to file for Chapter 11 bankruptcy protection if they cannot remain solvent.

“The $34 billion taxpayer bailout for which the Big Three are now asking is an unfair imposition upon the American people who are in no way responsible for, and should not face the consequences of, the profligate behavior of Big Three corporate and UAW union management,” read the letter.

Wilson believes that bankruptcy is the only option for the Big Three. “The nation’s bankruptcy laws were written with companies like GM, Ford, and Chrysler in mind,” said Wilson in a statement. “These companies have built-in, so-called legacy costs—pensions, health and other benefits—whose out-of-control growth have rendered the companies’ unprofitable.”

“The companies blame the current economic downturn, and not their own incompetence, for the current malaise they face,” Wilson added. “The fact is, any company that cannot withstand an economic downturn through the normal scaling back of operations that one would expect to occur may not be properly structured.”

“Things are so bad for these companies that Chapter 11 is the only way they can with confidence work out new contracts with labor, slow down production, close operations at their multiple dealerships, and otherwise readjust their business models to be able to adapt to economic conditions,” said Wilson. “Without going through bankruptcy, the Big Three will probably be hopelessly tied down by the contracts they have with Big Labor.”

According to the letter, the average unionized worker working for the Big Three makes on average $75 per hour in wages and benefits, nearly triple what other workers on average make in the private sector, has a JOBS Bank Program that entitles them to nearly a full salary not to work, and offers a generous 30-and-out pension program.

Wilson believes these costs have become “unsustainable.” In his statement, he said, “The current problems faced by the Big Three are the same crisis many holders of pensions will be facing in the coming years. Clearly, the taxpayer cannot afford to bail out every pension in the country, and for that reason, Congress must not create a new entitlement of guaranteeing every retirement plan in the country.”

“If Congress cannot draw a line in the sand here, there is no telling when and where the bailouts might ever stop,” added Wilson.

# # #

December 1st, 2008, Fairfax, VA—Americans for Limited Government president Bill Wilson today called upon President-elect Barack Obama to resist state calls for federal bailouts unless several key reforms are implemented both at the federal and state levels.

In a letter to the President-elect, Wilson called upon Obama to consider “reasonable, prudent measures to rein in the irresponsible budgeting that threatens to leave the next generation of Americans shackled to a mountain of debt.”

Specifically, Wilson urged that before any federal bailout for state and local governments is considered, budgets must be reassessed in light of falling home values. In addition, Wilson urged all contracts with organized labor be abrogated and set to “reasonable pay rates that are less than or equal to the private sector for the same work.” He further urged that all liabilities to employee pension funds be disclosed, budgets be trimmed back to no more than the rate of inflation over the past ten years, and all unfunded mandates imposed on the states by the federal government over the past ten years be repealed by Congress.

“The states have been hit with a double whammy,” wrote Wilson in his letter, “their own reckless spending—based in part on caving in to the demands of greedy public sector unions that clearly disdain the taxpayers, as well as sound fiscal policy—and the mandates imposed by a reckless Congress.”

Wilson said that the federal bailouts this year, totaling some $7.7 trillion according to Bloomberg News, have become uncontrolled, and that bailouts for state and local governments ought not to be added to the mix.

“The American taxpayer is going to be reeling for decades to come by the decisions being made by government today,” said Wilson in a statement. “To create a new federal entitlement to balance state budgets that grew well beyond any reasonable rate with federal tax dollars will eliminate any semblance of federalism in our Union.”

According to Wilson, the current requests for federal aid by state governors are an “end-run around constitutional, state requirements to balance budgets” and that it would be the start of “yet another federal welfare program.”

In his letter, Wilson advocated that state and local budgets be reassessed to take into account falling home values. “[C]learly the decline in home values has also fueled the decline in [property tax] revenue. The solution, however, is not to attempt to put a floor under home values or to encourage their values be overstated by assessors.”

Wilson alleges that state and local governments may attempt to overstate current property values in order to keep the tax revenues flowing. “If property is overvalued, legislators need not raise the rate of taxation on property and face the wrath of the public at the polls. Instead, property values must be allowed to find their market bottoms. No homeowner ought to be forced to pay extraneous taxation just to keep overinflated state and local budgets afloat,” said Wilson in his statement.

“President-elect Obama would do well to take note of the demands that current state budgets entail and that governors are requesting be funded by federal tax dollars,” he added. “It may be more than he bargained for.”

# # #

“This is an important moment for conservative bloggers nationwide,” said Bill Wilson, president of ALG. “In fact, it is not an overstatement to say that NetRightNation.com (NRN) provides bloggers a revolutionary new weapon in the Web’s far-reaching arsenal of democracy.

“With the advent of NetRightNation.com conservative bloggers across the country now have a free central location on which they can post their views and from which they can draw vital information about today’s most critical issues.”

Using a proprietary aggregating system, NetRightNation.com for the past three months has been systematically gathering conservative bloggers from throughout the United States. Starting with a core list of 1,500 bloggers, the system “spidered” out to where it now includes more than 60,000 conservative bloggers. And, according to Wilson, that number will continue to grow.

“We want every conservative blogger in America to know that he or she is no longer fighting an isolated battle,” Wilson said. “With NRN, bloggers now have a centralized location to feature their work. Mainstream media journalists can now have instant access to the conservative blogosphere’s latest thinking. And grassroots conservative activists will know who the key bloggers are in every town and city throughout the nation.”

NetRightNation.com, which describes itself as an “omnibus service bureau” provides a massive outlet for conservative bloggers unlike any ever offered in the private, public, or political sectors. No other website has ever ventured to feature such an extensive and inclusive bloggers showcase.

Said Wilson, “It is important for those in and out of the blogosphere to understand that NRN is not some sort of exclusive portal where bloggers are forced to become part of ALG and pay to publish. We’re not asking that bloggers to join us – we are asking that they allow us to join them. And the NRN service is free.”

The NRN omnibus portal allows visitors to the website to instantly access blogs by “Top National Blogs, “Top State Blogs,” and “Top Blog Issues.” The site’s technology continually updates the topics under each heading 24 hours a day, seven days a week. The site also provides a “Top Blog Story, which changes throughout the day with topics selected from large and small blogs nationwide.

“We have tremendous respect for the individual blogger who often slugs away for hours a day, who writes some brilliant analyses, but who too often goes unheralded,” Wilson said. “They are like the British miners Churchill praised at the height of World War II – they ‘cut the coal.’ Now, with NetRightNation.com, they can begin to get the credit they deserve.”

According to Adam Bitely, the editor of NetRightNation.com, the new bloggers portal features “the perfect combination of the canary in the mine and the 800-pound gorilla.”

“Like the canary in the mine,” Bitely said, “the new NRN portal will allow visitors to the site to see what bloggers are most concerned about long before it becomes an issue of national import. And, like the proverbial 800-pound gorilla, it will allow bloggers to coordinate their activities in fighting – and winning – the most critical battles at the local, state, and national levels.”

“NetRightNation.com has the ability to change the nature of the game of politics by shifting the field upon which it is played.”

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