An Historic Opportunity to Reassert States' Rights

Francis Marion, South Carolina's First Freedom Fighter

If ever there was a time for state leaders to stand up for freedom and the Constitutional rights and sovereignty of their states and say "no" to an increasingly fascist, thug-run federal government, this is it. Is Governor Sanford the only elected leader in South Carolina who sees what is at stake? Is there anyone else who recognizes the historic opportunity and the need to defend the rights and freedoms of our people and institutions? How can anyone reading the following editorial in today's Washington Times not recognize both the dangers and the opportunities that confront us?

South Carolina needs more than websites, transparency and public relations campaigns; it needs bold and decisive leadership.

The Roach Motel

Banks are getting trapped in TARP

Editorial from The Washington Times

Government bailout funds are the roach motel for financial institutions - they check in, but they can't check out.

Banks that were forced to take bailout money are running into political obstacles that prevent them from repaying it. The White House is unwilling to give up the additional control over the banks - the ability to make operational decisions, fire executives and dictate pay scales - that the bailout funds allow. All this has happened as the Congressional Budget Office has raised the estimated cost of the Troubled Asset Relief Program to taxpayers by almost $200 billion to a total bill of $356 billion.

In many cases, this government dependency is not the fault of the banks because many were being run responsibly. According to Fox News judicial analyst and New Jersey Superior Court Judge Andrew P. Napolitano, banks with no financial problems were forced to sell stock to the government or face the threat of costly and harassing public audits. This happened to banks that had "no bad debt, no credit default swaps, no liquidity problems, and no subprime loans" and didn't want or need any government funds. Judge Napolitano called the government actions what they are: "classic extortion."

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Obama's Moves a Step Toward Fascism

From The Chicago Sun-Times
By Steve Stanek

This week has brought two more reasons to be afraid --very afraid -- about what our federal government is up to.

The headline-grabbing reason is, of course, the firing of General Motors chief executive Richard Wagoner by President Obama and his administration's attempt to force a merger of Chrysler with Italy's Fiat. The other reason, all but ignored by the news media, is the declaration by Timothy Geithner that some banks will receive huge amounts of new government Troubled Asset Relief Program money even if they don't want it.

GM and Chrysler have received about $17.4 billion from the federal government over the past few months and want $22 billion more. Obama is holding off on the additional $22 billion to force the moves he wants. Those moves include the removal of Wagoner and remaking of GM's board of directors (with no concern for what GM stockholders want) and giving Chrysler 30 days to merge with Fiat.

Obama, Geithner, et al. tell us they do not want to run companies. But when they fire chief executives, install new ones, remake boards of directors and force mergers, that is exactly what they are doing.

Geithner's announcement that his agency is conducting "stress tests" that could force banks to take more federal money comes just a week after leaders of the nation's largest banks met with Obama and told him they want to pay back the TARP money they have already received, not take more of it.

Last week, Geithner announced he would decide, apparently with no firm guidelines, which companies -- including nonfinancial firms -- could pose "systemic risk" to the financial system. Such a designation would give the government unprecedented powers to inject itself into any business it chooses.

All of us -- not just corporate executives and shareholders -- should be shocked and frightened by these actions. The Constitution gives Congress, not the president, the power to appropriate money, yet trillions of dollars have been spent, borrowed and committed in the form of various guarantees without congressional approval.

The Constitution also blocks the government from interfering in private contracts. Various court rulings since the 1930s have weakened the protections, and now the executive branch is shredding them.

In addition to recent attacks on (admittedly unjustifiable) contractual bonuses at American International Group, the administration has recently moved to impose unjustifiable mortgage "cram downs" that require lenders to rework loans.

These recent actions amount to a fundamental move away from individual rights and toward state corporatism -- better known as fascism.

Steve Stanek is a research fellow at the Chicago-based libertarian Heartland Institute.