Congress: Oppose the Troubled Asset Relief Program

An Open Letter to Congress

Dear Senator or Representative:

I urge you to vote against Treasury Secretary Paulson's proposed $700 billion Troubled Asset Relief Program.

It is an outrage for the Treasury Department to propose plans, which, without any responsible oversight, allow it and the Federal Reserve to bail out irresponsible banks, investment banks and insurance companies.

We should be both appalled and frightened that in the span of three months, authority to increase the nation's debt ceiling will be increased by $1.5 trillion to $11.3 trillion, not inclusive of the Fannie Mae and Freddie Mac debt obligations (ostensibly $5 trillion) which we now have endorsed with an explicit U.S. guarantee.

As the fiscal year comes to a close with a projected $485 billion deficit, and worst-case estimates of FY 2009 deficits to range between $600 billion and $1 trillion, how can we reasonably believe these irresponsible fiscal actions will not lead to a destruction of the U.S. dollar and surging interest rates required by investors, increasingly foreign governments, to buy our increasingly tenuous debt instruments.

Including Fannie Mae and Freddie Mac obligations, our total nation debt now will exceed, for the first time since World War II, the total GDP of the United States. It has only been the very low interest-rate environment which has kept the cost of our profligate spending somewhat under control. At some point, perhaps sooner than later, buyers of our unending debt obligations may demand much higher interest rates due to the perceived higher risk of owning our debt.

It is not inappropriate to describe our reliance upon foreign governments to continually subsidize our deficit spending, including the TARP plan, as a matter of national security, given the implied opportunity (threat) for such governments to begin dictating terms by which they will continue to purchase our obligations.

Again, you are urged to vote against this plan as crafted, and require the Treasury and the Federal Reserve to rethink the methods by which the nation's financial system can be restructured.