Anger at Obama roils hearings on banking bills
WASHINGTON - Growing discontent over the economy and frustration with efforts to speed its recovery boiled over yesterday on Capitol Hill in a wave of criticism and outright anger directed at the Obama administration.
Episodes in both houses of Congress exposed the raw nerves of lawmakers flooded with stories of unemployment and economic hardship back home. They also underscored the stiff headwinds that the administration faces as it pushes to enact sweeping changes to the financial regulatory system while also trying to create jobs for ordinary Americans.
President Obama’s allies in the Black Congressional Caucus, exasperated by the administration’s handling of the economy, unexpectedly blocked one of his top priorities, using a legislative maneuver to postpone the approval of financial reform legislation by a key House committee.
Two buildings away, at a session of the Joint Economic Committee, Republicans escalated their attacks on Treasury Secretary Timothy Geithner, including a call for his resignation.
“Conservatives agree that as point person, you failed. Liberals are growing in that consensus as well,’’ said Representative Kevin Brady, a Texas Republican. “For the sake of our jobs, will you step down from your post?’’
Representative Michael Burgess, another Texas Republican, took a different tack. “I don’t think that you should be fired,’’ he told Geithner. “I thought you should have never been hired.’’
Across Capitol Hill, a stream of senators signaled their opposition to rushing regulatory reform. While some Democrats said they had reservations, Republicans went further, faulting Senator Christopher Dodd, a Democrat from Connecticut, for pushing ahead before the roots of the crisis were understood.
Perhaps most troubling for the administration was that one of the few measures to succeed yesterday was an amendment by Representative Ron Paul, a Republican from Texas who ran for president last year. That amendment, which won bipartisan support in the House Financial Services Committee despite the reservations of administration officials, would subject the Federal Reserve to unprecedented scrutiny. It would allow the Government Accountability Office to audit all of the Fed’s operations, including its decisions on interest rates and its transactions with foreign central banks.
Paul and allies in both parties - more than 300 members of Congress have endorsed the amendment - are looking to increase oversight of an institution they view as partly responsible for the financial crisis. Federal officials and many private economists worry that the amendment could make future policy makers more reluctant to take unpopular steps to prevent inflation or support the economy in the long term for fear of second-guessing by Congress.
The House Financial Services Committee had been set to vote to send the final piece of its financial regulatory overhaul package to the House floor after months of debate. That is, until the committee’s chairman, Representative Barney Frank, a Democrat from Massachusetts, told a shocked committee room that passage of the bill would be delayed until Dec. 1 because the Congressional Black Caucus wanted the administration to do more to help African-American communities suffering in the economic decline.
Frank told committee members that black lawmakers were “frustrated by the response to the economic situation by the administration.’’
Frank said the caucus had concerns about whether minorities were being fairly represented in helping carry out efforts to resolve the financial crisis. The government has contracted out much of the work to Wall Street firms. “You’re talking about people whose constituents have been badly hammered by this,’’ Frank said. “Given the nature of this recession, there needs to be some more conversations.’’
Congressional aides said the caucus’s concerns are similar to those of the Democratic Party’s liberal wing.
Meanwhile, Geithner was taking a beating as he urged Congress to pass regulatory reform as quickly as possible, arguing that delay would create uncertainty for businesses. Lawmakers sharply criticized him for his role in the crisis during the Joint Economic Committee meeting.
Geithner lashed back. Republicans “gave this president an economy falling off the cliff,’’ he told Brady. “I can’t take responsibility for the legacy of crises you bequeathed the country.’’
