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Posts Tagged ‘marxism’

Letter from the Capitol has a piece describing how Obamacare is just the first step in transitioning America’s citizens into paying a Value Added Tax (VAT) on goods on top of income tax in order to support our new Democratic Socialist future.  The last section on describing Obama’s impact on history is a lot nicer than I would have put it.

March 31, 2010

ObamaCare: Stalking Horse for VAT Taxation

Indiana Gov. Mitch Daniels says we must live “like good Europeans” as ObamaCare stifles choice & raises costs.  Which may explain why Fidel Castro called ObamaCare “a true miracle” and compared it to Cuba’s CastroCare….

Charles Krauthammer divines the true method behind ObamaCare’s fiscal madness: force adoption of a European-style Value Added Tax, creating a womb-to-tomb European Welfare State, with high taxes, high unemployment & high benefits allocated by government:

American liberals have long complained that ours is the only advanced industrial country without universal health care. Well, now we shall have it. And as we approach European levels of entitlements, we will need European levels of taxation.

Obama set out to be a consequential president, on the order of Ronald Reagan. With the VAT, Obama’s triumph will be complete. He will have succeeded in reversing Reaganism. Liberals have long complained that Reagan’s strategy was to starve the (governmental) beast in order to shrink it: First, cut taxes — then ultimately you have to reduce government spending.

Obama’s strategy is exactly the opposite: Expand the beast and then feed it. Spend first — which then forces taxation. Now that, with the institution of universal health care, we are becoming the full entitlement state, the beast will have to be fed.

And the VAT is the only trough in creation large enough.

As a substitute for the income tax, the VAT would be a splendid idea. Taxing consumption makes infinitely more sense than taxing work. But to feed the liberal social-democratic project, the VAT must be added on top of the income tax.

One reason for a VAT is that, as economist Alan Reynolds writes, the administration’s plan to extract $1.2TR from rich taxpayers over the next decade will not work.  Such filers already pay over 50 percent of income taxes.  Reynolds explains:

President Barack Obama’s new health-care legislation aims to raise $210 billion over 10 years to pay for the extensive new entitlements. How? By slapping a 3.8% “Medicare tax” on interest and rental income, dividends and capital gains of couples earning more than $250,000, or singles with more than $200,000.

The president also hopes to raise $364 billion over 10 years from the same taxpayers by raising the top two tax rates to 36%-39.6% from 33%-35%, plus another $105 billion by raising the tax on dividends and capital gains to 20% from 15%, and another $500 billion by capping and phasing out exemptions and deductions.

Add it up and the government is counting on squeezing an extra $1.2 trillion over 10 years from a tiny sliver of taxpayers who already pay more than half of all individual taxes.

It won’t work. It never works.

The maximum tax rate fell to 28% in 1988-90 from 50% in 1986, yet individual income tax receipts rose to 8.3% of GDP in 1989 from 7.9% in 1986. The top tax rate rose to 31% in 1991 and revenue fell to 7.6% of GDP in 1992. The top tax rate was increased to 39.6% in 1993, along with numerous major revenue enhancers such as raising the taxable portion of Social Security to 85% of benefits from 50% for seniors who saved or kept working. Yet individual tax revenues were only 7.8% of GDP in 1993, 8.1% in 1994, and did not get back to the 1989 level until 1995.

Put simply, taxpayers alter their investment, tax & work strategies to minimize the impact of punitive levies.

Herb London warns of ObamaCare’s threat to liberty.  A WSJ 3/30 editorial explains what I missed last week; ObamaCare does not explicitly call for hiring 16,500 IRS agents.  The figure is a GOP extrapolation from the IRS budget, to derive an estimate of what will be needed to enforce compliance on the new levies; if the IRS is left at present levels of resources revenues will be lost.

A WSJ editorial last week offered emerging examples of diminished health care choice, already underway due to ObamaCare.  At NRO Rich Lowry warns that deteriorating finances will force choosing between guns and butter, and that Obama clearly will choose to preserve the latter.  Nobel economist Gary Becker’s WSJ interview presents an optimist, but one who fears, as in the old joke about optimism & pessimism, that his optimism may be unjustified.

A WSJ editorial notes major companies already writing down their asset values due to anticipated ObamaCare impact–$14B during 2010, according to one consultant.  Naturally, a senior Obama administration hack calls these “irresponsible” while California thug-Rep. Henry Waxman (D-Beverly Hillbillies) plans an April 21 kangaroo-court show trial of major CEOs.  NRO’s Rich Lowry adds detail on Waxman’s efforts to muzzle companies hit by ObamaCare.

A WSJ editorial today describes just how outrageous this pressure is–companies are required by law to do what Waxman warns them not to do:

So the wave of corporate writedowns—led by AT&T’s $1 billion—isn’t caused by ObamaCare after all. The White House claims CEOs are reducing the value of their companies and returns for shareholders merely out of political pique.

A White House staffer told the American Spectator that “These are Republican CEOs who are trying to embarrass the President and Democrats in general. Where do you hear about this stuff? The Wall Street Journal editorial page and conservative Web sites. No one else picked up on this but you guys. It’s BS.” (We called the White House for elaboration but got no response.)

In other words, CEOs who must abide by U.S. accounting laws under pain of SEC sanction, and who warned about such writedowns for months, are merely trying to ruin President Obama’s moment of glory. Sure.

Presumably the White House is familiar with the Financial Standard Accounting Board’s 1990 statement No. 106, which requires businesses to immediately restate their earnings in light of their expected future retiree health liabilities. AT&T, Deere & Co., AK Steel, Prudential and Caterpillar, among others, are simply reporting the corporate costs of the Democratic decision to raise taxes on retiree drug benefits to finance ObamaCare.

Mark Steyn notes that one firm is heading for incorporation in Canada, no less–yes, CANADA:

In 2003, Washington blessed a grateful citizenry with the Medicare prescription drug benefit, it being generally agreed by all the experts that it was unfair to force seniors to choose between their monthly trip to Rite-Aid and Tony Danza in dinner theater. However, in order to discourage American businesses from immediately dumping all their drug plans for retirees, Congress gave them a modest tax break equivalent to 28 percent of the cost of the plan.

Fast forward to the dawn of the ObamaCare utopia. In one of a bazillion little clauses in a 2,000-page bill your legislators didn’t bother reading (because, as Congressman John Conyers explained, he wouldn’t understand it even if he did), Congress voted to subject the 28 percent tax benefit to the regular good ol’ American-as-apple-pie corporate tax rate of 35 percent. . . . I refer you to the decision last year by the doughnut chain Tim Hortons, a Delaware corporation, to reorganize itself as a Canadian corporation “in order to take advantage of Canadian tax rates.” Hold that thought: “In order to take advantage of Canadian tax rates”—a phrase hitherto unknown to American English outside the most fantastical futuristic science fiction.

Another little-noticed provision in ObamaCare: Money for long-term care will be automatically deducted from worker paychecks unless employees opt out; it is an estimated $146/month payment to give $75 daily care; some cost estimates peg the deduction at $240/month.  Cost at the lower figure is estimated at $100B.

Weekly Standard editor Matthew Continetti sums up what ObamaCare will do to Obama’s historical reputation:

The liberal line is that President Obama has secured his place in history by signing into law the Patient Protection and Affordable Care Act of 2010. And secured it he has. Henceforth Obama will be remembered as the man who accelerated America’s mad dash toward bankruptcy. He will be remembered as the leader who promoted a culture of dependency. He will be remembered as the figure who sacrificed a dream of national unity upon the altar of big government liberalism. It’s true: Obama is now a president of consequence. And almost all of those consequences are bad.

The fiscal picture was bleak before Obama made it worse. Government debt is 60 percent of the gross domestic product and climbing. The deficit is projected to remain above 4 percent of GDP for the next decade. The week before the president signed his health care reform into law, Moody’s warned that America’s AAA bond rating may be downgraded. The day before the signing ceremony, the nation learned that Warren Buffett is a safer investment than U.S. treasuries. One needn’t look across the Atlantic, where a penniless Greece is a supplicant to the IMF, to see our future. Look to California, where the economy is crippled by high taxes, high spending, and burdensome debt….

Gone is the charismatic young man who told the 2004 Democratic National Convention in Boston that there was no Blue America and no Red America, only the United States of America. All that remains is a partisan liberal Democrat whose health care policy bulldozed public opinion, enraged the electorate, poisoned the Congress, and set into motion a sequence of events the outcome of which cannot be foreseen.

This tarnished White House complains incessantly about the crises it inherited from its predecessor. Crises? You ain’t seen nothing yet.

The latest public health care horror show from the UK–presaging America’s ObamaCare future: nurses declining to bring a dying patient a glass of water.

CAN’T WAIT, CAN YE?

Bottom Line.  Coupled with America’s rapidly deteriorating financial position, ObamaCare is a massive, potentially fatal economic train wreck in the making.

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WorldNetDaily tells us that the Association of American Physicians and Surgeons (AAPS) has brought a lawsuit against the passage of the health care bill H.R. 3590.

Physicians group sues over health-care law

Says it violates Constitution in several ways


Posted: March 29, 2010
11:09 pm Eastern

© 2010 WorldNetDaily

WASHINGTON – The Association of American Physicians and Surgeons became the first medical society to file suit to overturn the newly enacted health-care law.“If the [law] goes unchallenged, then it spells the end of freedom in medicine as we know it,” said Dr. Jane Orient, executive director of AAPS. “Courts should not allow this massive intrusion into the practice of medicine and the rights of patients. There will be a dire shortage of physicians if the [new law] becomes effective and is not overturned by the courts.”

The law requires most Americans to buy government-approved insurance starting in 2014, or face stiff penalties. The AAPS says insurance-company executives will be enriched by this requirement, but it violates the Fifth Amendment protection against the government forcing one person to pay cash to another.The group also charges violations of the Tenth Amendment, the Commerce Clause, and the provisions authorizing taxation.

AAPS asks the U.S. District Court to enjoin the government from promulgating or enforcing insurance mandates and require Health and Human Services Secretary Kathleen Sebelius and Social Security Commissioner Michael Astrue to provide the court with an accounting of Medicare and Social Security solvency.

The group bills itself as “a voice for patient and physician independence since 1943.”

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A quote from Norman Mattoon Thomas, six-time Presidential candidate of the Socialist Party of America:

“The American people will never knowingly adopt socialism, but, under the name of ‘liberalism’, they will adopt every fragment of the socialist program until one day America will be a socialist nation without knowing how it happened.”

He went on to say, “I no longer need to run as a Presidential Candidate for the Socialist Party. The Democratic Party has adopted our platform.”

Related Posts: An Experiment On Socialism

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MSN has an article that explains how the 8.5% figure we hear from the Government should actually be about 15.6%.

The real unemployment rate? Try 15.6%

The official US jobless rate, now 8.5%, excludes millions of people — among them those who have given up on finding work and those forced into working fewer hours than they’d like.

By Catherine Holahan

MSN Money

An 8.5% unemployment rate is unmistakably bad. It’s the highest rate since 1983 — a year that saw double-digit unemployment, nearly 30 commercial bank failures and more than 15% of Americans living below the poverty line.

But the real national unemployment rate is far worse than the U.S. Department of Labor’s March figure, announced today, shows. That’s because the official rate doesn’t include the 3.7 million-plus people who are reluctantly working only part time because of the poor labor market. And it doesn’t include the workers who have given up scouring want ads for seemingly nonexistent jobs.

When those folks are added to the numbers, the unemployment rate rises to 15.6%. In March 2008, that number was 9.3%. The Bureau of Labor Statistics began tracking this alternative measure (.pdf file) in 1995.

“The situation out there is very grim,” says Heather Boushey, a senior economist at the Center for American Progress, a left-leaning think tank. “We have seen the mounting of job losses faster than any point since World War II. I have never seen anything escalate this bad.”

Even the Department of Labor’s expanded unemployment measure doesn’t fully capture how difficult the job market is for American workers. It doesn’t include self-employed workers whose incomes have shriveled. It doesn’t look at former full-time staff employees who have accepted short-term contracts, without benefits, and at a fraction of their former salaries. And it doesn’t count the many would-be workers who are going back to school, taking on more debt, in hopes that an advanced degree will improve their chances of landing a job.

Here’s another way to look at the unemployment figures: More than 5 million people have lost their jobs since the start of the recession in December 2007. And more than 13 million people are unemployed. That’s the highest number the U.S. has seen since it began tracking unemployment after World War II. For every job out there, more than four people are competing for it, says Boushey.

Mitch Feldman has seen the results of such intense competition firsthand. As president of New York executive placement firm A.E. Feldman Associates, he has watched lawyers accept paralegal jobs after failing to find any companies that are hiring. He has seen Ivy League-educated financial professionals accept lower-paid contract work after searching in vain for banking jobs.

“When some of the big investment banking firms had layoffs a year ago, those people were looking for permanent jobs,” but now they’re taking six-month and yearlong contracts, says Feldman. “And they’re competing with other contractors who were on contract before. More supply, less demand, and the prices go down.”

Some unemployed workers have become so frustrated by the difficulty of landing a job that they’re exiting the labor market altogether. Prior recessions saw a spike in the number of women choosing to be stay-at-home moms rather than continue to compete for work. This recession has seen a large spike in the number of laid-off men opting to become stay-at-home dads — or at least stay at home.

Once people stop looking for work, they’re no longer entitled to unemployment benefits.

Unemployment to worsen?

The employment situation on the horizon looks even worse. Typically, unemployment peaks six months to a year after the economy starts to recover, says Rebecca Blank, an economist with the Brookings Institution, a Washington, D.C., public policy think tank. Boushey believes the unemployment rate could reach double digits by the end of the year.So, even if the recent stock market rally is a harbinger of economic recovery, that doesn’t mean that unemployment rates will fall soon. Nor is an economic recovery a guarantee that unemployment will drop below 4%, as it did during the boom in 2000.

The way some economists see it, the U.S. has entered a downward spiral that could result in higher unemployment for the foreseeable future.

Right now, unemployment has helped fuel consumer cutbacks that have, in turn, pinched businesses’ revenues. That has forced them to cut jobs in an effort to stem profit losses, continuing the cycle. Eventually, the hope is that government spending will employ more people and give businesses more revenue, leading to more spending and more hiring — reversing the cycle.

But it might not happen that way. Spooked consumers, still reeling from an attack on all their assets, may simply not spend like they once did — regardless of how much money the government pushes into the economy. Instead, they might save money in preparation for the tax increases they assume are inevitable or put it in safe assets like long-term Treasury bonds.

Businesses might also curb their spending. Instead of responding to sales increases with hiring, they could invest in relatively cheaper technology to replace eliminated positions.

Economists don’t have to go back very far to find an example of a recovery that didn’t push unemployment back to its prior lows. The lowest unemployment fell after the 2001 recession was 4.4% in December 2006 (it hit that number again in March 2007). That was significantly lower than the 6.5% high in 2003. But it wasn’t close to the sub-4% rates seen in 2000.

That sort of recovery was what economists call a jobless recovery. “We weren’t really growing wages and income for people in the bottom half of the economic distribution,” says Alan Berube, an economist with the Brookings Institution.

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WorldNetDaily has a post with images from the TEA party in West Palm Beach, Florida.

Obama slammed: ‘Chains we can believe in’

Americans thrash president for perceived pursuit of socialism


Posted: April 15, 2009
10:22 pm Eastern

By Joe Kovacs
© 2009 WorldNetDaily WEST PALM BEACH, Fla. – A sign with President Obama’s famous “O” logo stating, “Chains we can believe in” welcomed hundreds of protesters to a tea party event here this evening in one of the nation’s most affluent regions.


The well-known “O” logo of President Obama is combined with a play on his “Change we can believe in” slogan at a tea party protest April 15, 2009, in West Palm Beach, Fla. (WND photo / Joe Kovacs)

Those braving rain showers to sound their objections to Obama’s policies voiced a common theme, one suggesting America is rapidly racing toward socialism.

“We’re headed toward socialism, and socialism is anathema to everything this country’s ever stood for,” said Fritz Breland, a self-employed yacht broker from Boynton Beach, Fla. “I’m essentially unemployed because no one’s buying.”

Bearing a simple cardboard sign equating Obama with socialism and evil, Breland was outspoken in his disgust for the direction in which he believes the U.S. is now headed.


Fritz Breland of Boynton Beach, Fla., displays a sign associating President Obama with socialism and evil at a tea party protest in West Palm Beach, Fla., April 15, 2009 (WND photo / Joe Kovacs)

“I see through you, Mr. Obama. You’re a socialist, and I will fight you with my last dying breath,” he said.

(Story continues below)

A West Palm Beach police officer monitoring the event from several stories up in a parking garage estimated the crowd to be approximately 500 before a downpour began to disperse some participants.


Carole Buell of Wellington, Fla., holds sign protesting government spending at West Palm Beach’s tea party April 15, 2009 (WND photo / Joe Kovacs)

Among those seeking shelter from the weather was Cheri Goldberg of Boca Raton, Fla., who admitted this was her first political rally.

“I have never in my entire life demonstrated, and I’m in my mid-sixties,” she told WND. She said she was upset because lawmakers are “signing these bills giving out money. They haven’t even read them.”


An unidentified girl braves rain showers to display a sign at West Palm Beach’s tea party April 15, 2009 (WND photo / Joe Kovacs)

Her message to Obama and Congress was simple: “Obey the Constitution, stop the bailouts and stop spending. Spend only what we have.”

Tom and Carol Dekker of Palm Beach Gardens, Fla., said they fled California five years ago, closing their construction business because of a high tax burden there.

“In California, we were paying upwards of 70 percent of our income to the government in taxes,” said Mrs. Dekker. “Seventy percent! That’s socialism.”


Two unidenitified girls hold signs while relaxing during West Palm Beach’s tea party April 15, 2009 (WND photo / Joe Kovacs)

She said if she could talk to the president in person, her advice to him would be, “Step down. He’s ruining our country.”


A sign calling the Federal Reserve Bank a terrorist organization is displayed at West Palm Beach’s tea party protest April 15, 2009 (WND photo / Joe Kovacs)

Tom Dekker said Obama’s mantra of “change” and his new direction are not where America has been since its inception, and says it’s unfortunate the former state lawmaker and congressman hasn’t had “any knowledge of running businesses to appreciate what it’s like to be able to pay your taxes, pay your employees, pay all your bills.”

“He thinks that he’s got an endless pot of money that he can continue to spend, and he’s mistaken. He does not. People are just at the tipping point right now, and if they don’t change their ways in Washington, people are going to stop … maybe they just stop paying taxes. If everyone stopped paying their taxes, I think that would really impact what’s going on.”

Related Posts: Media Covers Anti-Prop 8 Activists, Dismisses TEA Parties

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CNSNews brings us the expected news, at least expected to those of us who can see through the Democrats’ ploys, that they want to increase taxes on those making as little as $104,425.

The Democrats are trying to squeeze money for the Government anywhere they can, despite any “promises” they made during the “election”.  They’ve already tossed the ball around cutting VA benefits, but were batted down after such an outcry.  They’re getting ready to introduce the “cap-and-trade” crap that will only increase the cost of goods and services for everyone in America.  The tax on cigarettes hit today as well as the “stimulus” money in our paychecks, which is actually netting them more money on joint filers like myself.  I’ve had to increase my withholding, and I’ll probably still end up owing at the end of the year.

I can say one thing:  this is definitely “change”, but this “change” is killing America.

Senate Tax Chair Wants Vote This Year to Raise Taxes on People Making as Little as $104,425

Wednesday, April 01, 2009
By Matt Cover


(CNSNews.com) – Sen. Max Baucus (D-Mont.), chairman of the Senate Finance Committee which has jurisdiction over federal tax law, is seeking a vote this year on legislation that would  increase the income tax rates on some Americans who earn as little as $104,425 per year.

The bill, which Baucus introduced Thursday, would fulfill many of President Barack Obama’s promised tax changes, including making most of the tax cuts enacted under former President George W. Bush permanent while raising taxes on Americans making more than $250,000 per year.

But those making more than $250,000 per year would not be the only ones to see their taxes go up if Baucus’s bill becomes.

The proposed legislation would raise the rates on the top two income brackets, from the current levels of 33 percent and 35 percent respectively, to 36 percent and 39.6 percent. The new rates would become effective after 2010.

The increase in the rates for these two brackets will affect all taxpayers who fall into these two brackets regardless of their filing status, according to Heritage Foundation Senior Policy Analyst Curtis Dubay, who reviewed the legislation.

That means some taxpayers earning as little as $104,425—far less than half the $250,000 threshold President Obama set for raising income taxes—would see their income tax rate increased.

According to the Internal Revenue Service, the second highest income bracket—currently set at 33 percent—kicks in at an income level of $104,425 for a married person filing separately; $171,550 for someone filing as a single person; $190,200 for someone filing as a head of household; and $208,850 for a married couple filing jointly.  Under Baucus’s proposal, the tax rates for all these people would jump to 36 percent.

The highest income bracket—currently 35 percent—kicks in at an income level of $186,475 for a married person filing separately; and $372,950 for all other filing statuses.

After studying the bill, Dubay of the Heritage Foundation told CNSNews.com that unless Congress changes the income levels that the top two tax rates kick in for each filing status, taxes will be increased on many more Americans than previously indicated by the Obama administration. (A spokesman for Baucus confirmed to CNSNews.com that the tax proposal does not change the taxable income levels of each filing status–it raises the two top tax rates across the board.)

For a chart showing the current tax rates and income brackets for all filing statuses in 2009 click here.

The income levels in question are indexed to inflation–meaning they will almost certainly be slightly higher by the time the new tax rates take effect in 2011 if Baucus’s bill passes.

Since 2007, the income level for a married person filing singling in the 33-percent tax bracket has gone up only $6,500, from $97,925 to $104,425.

Related Posts: ‘Cap-And-Trade’ Bill Introduced, Hearings Begin April 20
An Experiment On Socialism

House Majority Leader Doesn’t Know Where Obama Got Authority For Auto Bailout

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CNSNews is reporting that, in an interview with House Majority Leader Steny Hoyer, the Democrat said, “I don’t know technically where that authority would be,” referring to how the Obama Administration is using TARP funds for the auto companies.

Hoyer: ‘I Don’t Know’ Where Obama Got Legal Authority for Auto Plan

Wednesday, April 01, 2009
By Fred Lucas, Staff Writer


(CNSNews.com) – House Majority Leader Steny Hoyer (D-Md.) told CNSNews.com on Tuesday that he does not know where President Barack Obama gained legal authority to oversee a restructuring of General Motors and Chrysler.  But if authority is a question, he said, then Congress will grant it to the administration.

However, when Congress  tried to enact an auto industry bailout plan in December, the legislation was approved by the House but failed in the Senate where, under the rules, it needed 60 votes.

Senate Banking Chairman Chris Dodd (D.-Conn.), meanwhile, toldCNSNews.com he was somewhat surprised that the administration did not consult with him at all about its auto industry plan despite his key committee chairmanship and that he had “been reading about it in the papers basically.”

Hoyer was similarly candid about his inability to cite the administration’s legal authority for the plan.

“The administration clearly believes it does have the authority to use some of the remaining TARP funds for the automobile industry,” Hoyer told CNSNews.com Tuesday.

“I don’t know, technically. I would be kidding you to mouth some words on that, because I don’t know technically where that authority would be,” Hoyer said. “But my own view is that if it is perceived they don’t have that authority and it is perceived by the Congress they need to have that authority, the Congress would probably be willing to give that authority. But I don’t know technically the answer to that question.”

The White House is implementing its plan under the $700 billion Troubled Assets Relief Program (TARP) that Congress enacted last year specifically to bail out financial institutions—and not other businesses such as auto manufacturers.  When President Bush asked Congress last fall to approve legislation authorizing him to use TARP money to bailout the auto industry, Congress rejected the legislation.

Even though the legislation was defeated, President Bush’s Treasury Department went ahead and loaned $17.4 billion in TARP funds to General Motors and Chrysler.

Critics ranging from Clinton Administration Labor Secretary Robert Reich to the conservative Heritage Foundation criticized Bush for acting unlawfully in doing so.

The TARP law specifically says, “The Secretary is authorized to establish the Troubled Asset Relief Program (or ‘TARP’) to purchase, and to make and fund commitments to purchase, troubled assets from any financial institution, on such terms and conditions as are determined by the Secretary, and in accordance with this Act and the policies and procedures developed and published by the Secretary.”

The law does not include auto companies under the category of “financial institution.” The law says the following: “The term ‘financial institution’ means any institution, including, but not limited to, any bank, savings association, credit union, security broker or dealer, or insurance company, established and regulated under the laws of the United States or any State, territory, or possession of the United States, the District of Columbia, Commonwealth of Puerto Rico, Commonwealth of Northern Mariana Islands, Guam, American Samoa, or the United States Virgin Islands, and having significant operations in the United States, but excluding any central bank of, or institution owned by, a foreign government.”

Dodd, like Hoyer, expressed uncertainty when asked where the president got the authority to further fund the auto industry and oversee its restructuring given that TARP only authorizing federal aid to financial institutions.

“I don’t know whether there is legislative action needed regarding all this,” Senate Banking Chairman Christopher Dodd (D-Conn.) told CNSNews.com Tuesday. “There may be. I just don’t know enough details of this and obviously we’re going to be talking about it.”

On Monday, President Obama announced certain conditions that General Motors and Chrysler would have to meet to get additional government funds. These included requiring both automakers to produce more “fuel efficient” vehicles, and requiring Chrysler to merge with the Italian auto maker Fiat.

Additionally, the administration “asked” General Motors President Rick Wagoner to resign.

“I wasn’t consulted at all on the process, not that I expected to be necessarily, but as the committee of some jurisdiction on this matter, I kind of expected I might hear something. I’ve been reading about it in the papers basically,” Dodd said.

Dodd also said he had questions about the president’s proposal regarding Chrysler.

“One piece that has me somewhat perplexed is whether or not we are providing funds to Chrysler in order to make their position attractive to Fiat,” Dodd said. “That’s going to raise questions in people’s minds.”

Using TARP money to finance a government-driven restructuring of GM and Chrysler as announced by Obama would not be legal without a congressional authorization, said Rep. Trent Franks (R-Ariz.).

“No, it’s not legal without congressional approval,” Franks told CNSNews.com. “The language is clear. The money is directed toward financial institutions. But that may be the least of our challenge. The president finally seems to realize that bankruptcy may be the best option. The notion that government could specify what vehicles to make is ridiculous.”

Sen. Orin Hatch (R-Utah) said he found the treatment of GM President Rick Wagoner troubling.

“It’s my understanding that the CEOs voluntarily agreed to really be the scapegoat here and I think it’s very difficult to say that the president did anything wrong there,” Hatch told CNSNews.com. “But I do not want the federal government dictating who runs corporations in this country. Now there is no question there is a lot of leverage with the federal funds. But it’s a very troubling thing that people think politicians can fire a leader of a company.”

Hatch added he was skeptical about the government’s ability to guarantee warrantees on vehicles.

“It’s tough to guarantee a warrantee if a company is out of business,” Hatch continued. “You can guarantee maybe parts, but ultimately, it is very difficult to do that without getting the government in a difficult position. It’s easy to say things like that. It’s another to do them.”

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