Thank You Czar Paulson, May We Have Another! Examining The 58 TARP Flippers

Video:  Kevin Bacon - Animal House - Thank You Sir, May I Have Another!

Earlier this morning we took a look at 'TARP yes voters' who were sent home from Congress last week and in 2008.  We supplement that story now with an election analysis of the 58 turncoats who ignored the overwhelming will of the American people, and switched their original 'NO' votes to:

• "Yes Esteemed Paulson, we are your loyal subjects, you are the most kind of all Dictators, so righteous and clever with leverage and the SEC, the Taxpayer cupboard belongs to you, Great Hammer!  Thank you czar, may we have another!"

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Huge thanks to Cheyenne who researched and submitted the following...

Examining the 58 TARP Flippers

When TARP came up for a vote the first time, the House shot it down 228-205.  The Senate took the 3-page bill, added hundreds of pages of pork, passed it overwhelmingly, and then kicked it back to the House for another vote just four days later.  Thus bloated with waste, TARP somehow passed by a wide margin of 263-171, meaning 58 congressional representatives switched their no vote to a yes.

57 of the 58 ran for reelection in 2008.  Jim Ramstad (R-MN) had already announced he would retire in 2007.  Out of this field of 57 cowardly dumbshits, 55 were reelected.  Joe Knollenburg (R-MI) and John "Randy" Kuhl (R-NY) were the only two who lost.

Flash forward to 2010 and break down the 55 remaining TARP flippers:

Two announced their retirements in early 2010, John Shadegg (R-AZ) and Diane Watson (D-CA).

One was appointed Secretary of Labor by Obama, Hilda Solis (D-CA).

Four were clipped in the primaries (in one way or another) and thus didn't run, Gresham Barrett (R-SC), Peter Hoekstra (R-MI), Carolyn Kilpatrick (D-MI), and Zach Wamp (R-TN).

So 48 TARP flippers were up for reelection a second time in 2010.  Out of 48, just two lost their seats, Harry Mitchell (D-AZ) and Solomon Ortiz (D-TX), the latter of whom lost an extremely close race.  Check out the margins for most of the 46 "winners" over their challengers...

Incumbent ("I") I (%) C (%)
Abercrombie, Neil D-HI
 58 41
Alexander, Rodney R-LA
 79 21
Baca, Joe D-CA
 66 35
Berkley, Shelley D-NV
 62 35
Biggert, Judy R-IL
 64 36
Boustany, C. R-LA
 100 0
Braley, Bruce L. D-IA
 50 48
Buchanan, Vern R-FL
 69 31
Carson, Andre D-IN
 59 38
Cleaver, Emanuel D-MO 53 44
Coble, Howard R-NC
 75 25
Conaway, K.M. R-TX
 81 15
Cuellar, Henry D-TX
 56 42
Cummings, E. D-MD
 75 23
Dent, Charles W. R-PA
 54 39
Edwards, D. D-MD
 84 16
Fallin, Mary R-OK
 60 40
Frelinghuysen, R. R-NJ
 67 31
Gerlach, Jim R-PA
 57 43
Giffords, Gabrielle D-AZ 49 47
Green, Al D-TX
 76 23
Hirono, Mazie K. D-HI
 72 25
Jackson, Jesse Jr. D-IL 81 14
Jackson-Lee, Sh. D-TX
 70 27
Lee, Barbara D-CA
 83 12
Lewis, John D-GA
 74 26
Mitchell, Harry E. D-AZ
 43 52
Myrick, Sue W. R-NC
 69 31
Ortiz, Solomon P. D-TX
 47.1 47.9
Pascrell, Bill Jr. D-NJ
 63 36
Pastor, Ed D-AZ
 66 28
Ros-Lehtinen, I. R-FL
 69 31
Rush, Bobby L. D-IL
 80 16
Schiff, Adam B. D-CA
 65 32
Schmidt, Jean R-OH
 59 35
Scott, David D-GA
 70 29
Shuster, Bill R-PA
 73 27
Sullivan, John R-OK
 77 23
Sutton, Betty D-OH
 55 44
Terry, Lee R-NE
 61 39
Thompson, Mike D-CA
 63 32
Thornberry, Mac R-TX
 87 9
Tiberi, Patrick J. R-OH
 56 41
Tierney, John F. D-MA
 57 43
Welch, Peter D-VT
 65 32
Woolsey, Lynn C. D-CA
 65 30
Wu, David D-OR
 55 42
Yarmuth, John A. D-KY 55 44 

In four days you're telling me that 58 representatives just upped and changed their minds about the most massive single transfer of money in human history?  It's an issue that deserves, well, further scrutiny.

A few things jump out.  First, the bailout was clearly a bipartisan con job.  Second, I figured the flip-floppers would've come from up-for-grab districts - the ones that could be bought with some well-timed pork. 

Not the case at all.  You can see from the voting margins that many of the flippers are locks, not in danger of going down in a general election.  If they didn't need pork to stay in power, and didn't get any, it makes you wonder what exactly motivated them to change their votes.

Must have been a case of the fear mongers.

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DB here.  Make sure to read this story from the NY Times on Henry Paulson's role in the SEC rule change (2004) that allowed leverage to expand from 12:1 to 100:1 for only the 5 largest investment banks. 

It is the single most important piece to understanding the financial crisis.  And it is also the event most ignored by CNBC and the rest of the mainstream news media.

From the New York Times:

• Paulson SEC Rule Change -- The Secret Details

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Related clips...

Watch this one!

A Daily Bail Original Film: Hank The Hammer

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• EXPOSED: The Lies Of Hank Paulson (WATCH)

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• Kanjorski Reveals Paulson's Closed-Door TARP Threats

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More detail on this clip:

• And Now A Word From Henry Paulson

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More reading:

• CNBC's Becky Quick is a bailout apologist and believer in Paulson's myth of societal breakdown if TARP hadn't passed (Run For Your Lives!)

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Comments

[DailyBail]

terrific research cheyenne..

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[DailyBail]

Paul Kanjorski Goes Down In Flames - Hank Paulson Cries

http://dailybail.com/home/paul-kanjorski-goes-down-in-flames-hank-paulson-cries.html

[DailyBail]

Persons of Interest: Congresspeople Who Switched TARP Vote Then Left Office

http://consultingbyrpm.com/blog/2010/01/persons-of-interest-congresspeople-who-switched-tarp-vote-then-left-office.html

[DailyBail]

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[G Street]

Maybe one of the 58 I-was-against-it-before-I-was-for-it flippers could tell us exactly what was so compelling. Kanjorski raised more questions than he answered in his description of Paulson's $700B hold up. If $550B had been withdrawn from money market accounts within an hour or two, WHO was doing the withdrawing? Was it a terrorist attack? Furthermore, he makes the odd extrapolation that $5.5T would have been withdrawn by the end of the day. By whom, to where? Was it an electronic run on banks by each other - thus each withdrawal becoming a deposit somewhere else? And Paulson claims they did a $150B intervention and "closed down the accounts". So, afterwards these accounts were reopened with money taken from ordinary Americans to cover over-leveraged bankers? Aren't the bankers and insurance companies, by definition of their roles, supposed to be able to cover the losses?

Hank Paulson's role deserves much closer scrutiny, and no one can demand immunity during the commission of a crime.

[Cheyenne]

Great points, G Street. Kanjorski's "explanation" doesn't pass the smell test.

Even taking everything Kanjorski said as true, he still fails to explain why $700B was necessary at all. By his own account, the problem of the $550B draw-down was solved when Treasury shut down the accounts and then guaranteed them for $250K. According to Kanjorski, the run began on September 15 (a Monday) and was resolved by that Thursday.

So why did TARP have be passed two weeks later, on October 3 (a Friday, following TARP's initial rejection by the House on Monday, September 29)? More to the point, how did the $700B fix the problem? What exactly is contained in the TARP legislation that will prevent future electronic runs? Again, that problem was fixed, according to Kanjorski, two weeks prior to TARP passage.

To circle back to our 58 TARP flip-floppers, why didn't they put these and other questions to Paulson and Bernanke when presented with these apocalyptic scenarios? Do these representatives and their advisors suffer from a wholesale lack of critical thinking skills? The reps themselves, yeah. Maybe their advisors too. But I think something else was at work.

One possibility is that these representatives were panicked as they watched the stock market plunge that began on September 19 continue unabated through October 3. Over that span, the DJIA dropped from 11,400 to 8500. Having watched a quarter or more of their wealth disappear in two weeks, they may have believed anything. Who knows?

At a minimum, these people should be asked what went on that week to change their minds, and whether TARP did a single goddamn thing to forestall a repeat performance. On this score, it's worth pointing out that no one in the fourth estate asked the right questions.

[robertsgt40]

You're forgetting they still cook the vote when needed

[DailyBail]

One possibility is that these representatives were panicked as they watched the stock market plunge that began on September 19 continue unabated through October 3. Over that span, the DJIA dropped from 11,400 to 8500. Having watched a quarter or more of their wealth disappear in two weeks, they may have believed anything.

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Here's what i wrote cheyenne...it's from the original kanjorski video...

http://dailybail.com/home/kanjorski-reveals-paulsons-closed-door-tarp-threats.html

As readers know, several Congressional members have alluded to a private meeting with Paulson and Bernanke in which vague economic Armageddon was threatened if Congress did not immediately hand Hank $700 billion, with no oversight. As the political debate raged over the next 15 days, several members expressed a sense of shock over the severity of the secret warnings, while refusing to divulge the details to a concerned public. Representative Sherman of California later accidentally revealed that members were warned that Martial Law would follow if the $700 bailout plan were not approved quickly. Days later it was confirmed that the warning was delivered by Treasury Secretary Paulson. Listen while Kanjorski relates the fear about an electronic run on the banks that was apparently part of the Congressional scare tactics employed by Paulson and staff. You will notice that he says members were told that within 24 hours, the entire political structure of the United States would collapse. Talk about hitting a Congressman where it hurts, Paulson went straight for their political testes.

I don't doubt Kanjorski's telling the truth. And I have been very curious to know exactly what was said in the private meeting, that turned the entire sad lot of them ashen with fear. Kanjorski's statement supports the thesis that the Fed and Treasury were not playing by the rules, and that they dissembled and utilized apocalyptic fear-mongering to frighten Congressional leaders who were already intimidated by the seeming complexity of the financial issues. Tell me in comments if you think we were at Armageddon's doorstep that day. Without some show-me, I'm not buying it. The truth is they utilized the panic for political benefit and hoisted cataclysm upon already cowering Congressional members.

Furthermore, it's not plausible that an outflow of the proportion described above could have been slowed by the enhanced money market guarantee that was announced. A mid-afternoon boost of the FDIC insurance limit from 100k to 250k is not enough to assuage a market that has seen $550 billion evaporate in 2 hours. Even if you shut it down early for the day, it still doesn't pass the smell test. Kanjorski has unwittingly revealed evidence that Treasury and the Fed embellished (lied) to members of Congress to further their case for TARP approval. And though never punished directly for their dissembling nature, they have been exposed in the aftermath as fear-mongering apologists and protectors of the failed banking class. The integrity of both federal institutions is now openly questioned by taxpayers and elected officials. This is not a good place.