Garrett Spins Again

Due to a number of reasons, I've been away from covering Representative Scott Garrett for longer than I ever would have imagined. However, after receiving an e-mail from a reader, I was snapped back to reality. Garrett has spinning again, big time.

At issue, is this week's Garrett Gazette, with it's title "Has Stimulus Failed New Jersey?" Here's the offending statement:

As President Obama prepares for his State of the Union address, unemployment remains at record highs for Americans. The White House claims their stimulus bill “has already created or saved up to 2 million jobs,” but the table below compares the White House's recent claims of state-by-state job creation with the actual change in state payroll employment through December 2009, using data announced on Friday by the U.S. Department of Labor. According to the data, 49 States have lost jobs since stimulus was enacted in February 2009. Only North Dakota and the District of Columbia have seen net job creation, and even those levels fall short of White House claims.

Garrett's playing semantics games again. The White House has never claimed that the stimulus eliminated job losses, only slowed them down. Here's what the White House actually reported:

Citing its own analysis plus a range of private sector summaries, the council estimated the annual growth rate last year would have been roughly 2 percentage points lower, and there would have been 1.5 million to 2 million fewer jobs.

So while Garrett would like you to believe the promise was job growth, all that was promised and delivered was that things would be better than without the stimulus. And that's what happened. Less unemployment and greater GDP.

Whether or not you agree with the stimulus, the least we should expect of Garrett and the Republicans is that they discuss the results honestly.

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Just a quick note to readers: As I've started getting e-mails from a few of you asking what's going on, I'm healthy, just super busy. I have a number of side projects going on that have gotten in the way.

Garrett vs. Unemployment Extension

Representative Scott Garrett was one of 12 Representatives to vote against extending unemployment benefits to the unemployed. If Garrett ever releases a statement on his reasoning I'll post it.

Garrett Opposes Medicare

So, after taking a weeks vacation and working to get another project off the ground, I decided I should see what's been cooking in the health care debate with Representative Scott Garrett. Unfortunately, not much has changed in the two weeks of my hiatus.

His staff, apparently in response to pointed criticism from Representative Steve Rothman, decided to put the following statement on his website:

That's a pretty bold statement. As Medicare is government health care, I'm sure the seniors of the District would find that nugget slightly terrifying. One would have to think the sentiment could be fodder during the general next year if applied properly.

Garrett and Rothman faced off on CNN. Herb Jackson posted Rothman's critique:

You know, Scott, I looked on your website tonight. I saw that we share the same concerns and you were criticizing the Democrats' ideas, but you didn't offer one specific program on your website of how to address the problem of insurance companies dropping people with insurance when they get sick or providing competition so the insurance companies can't raise rates, double and triple, as we've seen them happen before.

Garrett does have the e-mail he's sent out before now posted, and although rather nice on platitudes, doesn't list any of the bills he claims he handed the President last week. It also, and I think this is disingenuous, links to Op-Ed pieces as "general news". Call it what it is, the opinions of people Garrett agrees with.

The bottom line is not much has changed during the health care debate. Even if everything Garrett says he supports were in the final bill, and what he isn't saying is that much of it was in the initial bill, he's going to vote against it. Garrett's not even taking the discussion or constituents' concerns seriously, as he was in Europe defending European hedge funds instead of holding town halls.

The sad thing is, Garrett isn't alone on this. Republicans are using this as a building block for 2010, at the expense of the American people and our economic recovery. Petty and partisan, my hope is that before November 2nd next year, people will start to realize that's exactly what's going on.

Garrett Lectures EU on Hedge Funds

A hallmark of conservative principles used to be that we don't interfere with other nations, because we don't want them interfering with us. However, in this new world, our Representative Scott Garrett decided he should join in defense of hedge funds with Representative Paul Kanjorski in criticizing what is essentially a European Union decision. From Bloomberg:

Paul Kanjorski, a Pennsylvania Democrat, told EU lawmakers today that proposed EU rules “scared the living bejesus” out of the industry. (London Mayor) Johnson said that the proposals threaten London’s role as a leading financial center.

The rules under consideration would limit the amount of borrowing hedge funds can use and require the use of European- domiciled banks. The initiative was designed amid the fallout from the financial crisis, in which the decline of the U.S. housing market triggered bank losses and triggered the first worldwide recession since World War II.

“Your focus should be elsewhere,” Congressman Scott Garrett, a Republican from New Jersey, told members of the European Parliament’s economic and monetary affairs committee. He said hedge funds weren’t the cause of the global financial crisis.

While Garrett has a history of defending hedge funds, one has to hope the characterization of Garrett's comments weren't actually Garrett saying they played no part in the problem. It would be the height if irresponsibility for him to suggest hedge funds played no part in artificially inflating the bubble.

However, Garrett's "focus elsewhere" comment is very much in line with his thinking. Readers have to remember, he voted against having hedge fund managers taxed like normal people, which would lay the groundwork for a permanent AMT fix for the 20% of our District who have to pay it.

Yes, apparently the opposition to the proposals are bi-partisan, but why are our Congressmen over in Europe telling them how to run their markets? What jobs are they costing our financial sector, if in fact hedge funds would move, should the regulations go into place?

Nearly 10% of NJ's Lost Jobs Are Back

Correction: It was pointed out that the 150,000 jobs lost was total, not simply private sector. Therefore, with the public sector losses, the overall gains are actually about 5%.

In a conference call that just finished up a little bit ago, Governor Jon Corzine touched on something that probably is getting lost in all of the press about Chris Christie's apparent violation of the Hatch Act and the overall politicization of our Justice Department under Karl Rove and George Bush.

We here in NJ gained 13,000 private sector jobs last month. Since 2007, we've lost about 150,000, so we've gained 8.6% back. It's still a long way to go, but 9% in a month is progress.

Since the beginning of the recession in December 2007, New Jersey has lost 150,100 jobs (-3.7%). Nationally, employment has declined by 6.7 million jobs (-4.8 %).

Considerable over-the-month job gains occurred in the leisure and hospitality (+6,200), construction (+3,400), professional and business services (+3,200), and manufacturing (+3,100) supersectors. Hiring in the arts, entertainment and recreation component (+5,300) was responsible for the gain in leisure and hospitality, while most of the growth in professional and business services employment was due to gains in the administrative support/waste management/remediation segment (+2,900). In construction, the job gains were mainly due to hiring by specialty trade contractors.

So not only did we add jobs, we've lost fewer jobs as a percentage than the nation. As someone who regularly reads the reports, and chastised those who ignore them, the fact we actually added manufacturing jobs is, well, shocking. When you consider that since the recession began in 2007 as a nation we've lost 2 million, and in New Jersey we've been losing them for months, the gain is definitely a positive sign.

With Christie's ethics armor getting dented (daily at this point), if New Jersey can get a few months like this before the Election, Corzine will definitely be in a stronger position.

It's good to have some good news for a change.

Garrett's Big Day

Representative Scott Garrett is going to have a big day today. H.R. 3269 is on the floor, which is going to give shareholders a greater say in compensation packages and disclose their incentives. As by the Wall Street Journal and Bloomberg, Garrett is on a mission to stop this from happening.

Garrett has introduced an amendment that's now being debated to basically re-write the entire bill. You can watch the proceedings on CSPAN.

Garrett helps Corzine

Representative Scott Garrett and Transportation Secretary Ray LaHood (a Republican) are not the closest of friends, at least in the media. I had written about one dust up two years ago between Garrett and the unapologetic moderate. Recently, they revisited their "good will" toward each other. From The Hill:

LaHood got into a heated argument over the $787 economic stimulus package Friday with Rep. Scott Garrett (N.J.) while offering testimony to the House Budget Committee.

The debate was related to attempts by some Republican governors to refuse stimulus money, and ended up with LaHood offering praise to New Jersey’s Democratic governor, Jon Corzine, who faces an uphill reelection battle this year.

[snip]

"Sen. Kyl is not in charge of the money, congressman," LaHood told Garrett. "The governor is. I wanted to be sure that the governor was not in the same line of thinking."

When Garrett wondered whether his state would receive a similar letter, LaHood backed Corzine, the embattled New Jersey governor, noting that he had secured millions in stimulus funding from Congress. Corzine this year is facing a tough re-election race against Republican Chris Christie.

"Your governor has been a real leader in this, by the way," LaHood said during an exchange in which the two former GOP conference members talked over one another.

Garrett and his people were so pleased by the exchange, they made a video of it and put the testimony up on Garrett's YouTube Page:



By Garrett persisting as he did, and feeling it was worth posting, Governor Corzine was able to get this nice little web video made:



Nothing like a respected moderate Republican sitting and giving sworn testimony that a Democratic Governor has created jobs during an election year. Corzine should probably call and thank Garrett.

Garrett's Statement On His Mortgage Vote

As noted earlier today, if Representative Scott Garrett decided to shed some light as to why he joined 14% of voting Members in opposing cracking down on predatory lending and fraud I'd post it. It's roughly the same "if we take the fraud and dishonesty out of the process, you the consumer will be hurt" line of logic he used justifying being opposed to credit card reform.

Here's his statement:

“At a time when millions of Americans are still feeling the pain from the credit crisis, this bill will further restrict credit options for consumers and decrease liquidity in our nation’s mortgage markets.

“Additionally, it’s unfortunate that this bill does not do anything to reform Fannie Mae and Freddie Mac. As these two entities have been identified among the leading causes of the financial crisis, it should be a top priority to address the problems with them as soon as possible.

Garrett had issued this statement on an earlier version of the bill that I had missed:

“The intent of the Mortgage Reform and Anti-Predatory Lending Act is to improve mortgage lending regulation. Unfortunately, this legislation has the potential to limit the accessibility of home financing options for consumers, while increasing the cost of credit. Due to its breadth in scope, there is the potential for many unintended consequences in the marketplace, as the legislation affects everyone from the mortgage originators that make loans to the securitizers that package the loans in the secondary market.

“I do appreciate the intent of the bill, which is to increase underwriting standards and protect borrowers. In actuality, though, this bill is flawed in many ways, as it contains a weak safe harbor provision, increases the liability for assignees and securitizers and places a larger class of loans under the Home Ownership and Equity Protection Act’s (HOEPA) high-cost provisions.

“In addition, the risk retention requirements as structured will force lenders to markedly increase their capital, which will further narrow credit choices and increase the cost of borrowing for consumers. I applaud Chairman Frank for his efforts in trying to address the important issue of risk retention, however, I believe there are ways to construct this provision more effectively. I look forward to working with him to find solutions for this matter, possibly in the form of covered bonds, which have the potential to aid in returning liquidity to the mortgage market with their high underwriting standards and may also serve as an alternative to securitization.”

Garrett Hearts Predatory Lenders?

Well, Representative Scott Garrett was one of 59 Representatives to vote against providing the resources to crack down on predatory lenders. Garrett's vote really, to me at least, makes no sense.

I can understand him standing with the hedge funds, he always has. I can understand him standing with the credit card companies that double bill, his opinion is that those taking cards have the responsibility to know they're getting ripped off.

But not prosecuting fraud?

What's the logic causing one to vote against providing the money to investigate and prosecute those predatory lenders who assisted in the financial markets melting? If there aren't prosecutions, does that validate his perception it's the borrowers fault? I realize Garrett usually doesn't want to blame lenders, but he has to recognize predatory lenders exist.

And the bill deals with sniffing out fraud with TARP funds. For a guy that spends a lot of time talking about waste fraud and abuse, I would have thought when the opportunity to throw those folks in jail came along he would have been on board. Not providing funding to crack down on TARP fraud?

If Garrett posts a statement regarding this vote, I'll put it up.

Bye Bye Pontiac

I was rather sad to see the news that GM is going to be shutting Pontiac down. My first car was a 1976 Grand Le Mans (similar to one pictured above), and I've had many many Pontiac rental cars (I ask for them). Even though I drive a Chevy, I've always had a soft spot for Pontiac.

The ones who follow these sorts of things have often speculated it would be Pontiac or Saturn to go down, another brand I'm fond of.

As sorry as I am to see the brand go, my heart really goes out to the 21,000 folks who are going to lose their jobs. Unfotunately, many of these people are the victims of "this quarter's all that counts" mentality that's dominated the American auto-industry for decades now.

Farewell, old friend.

Garrett on Geithner's Plan

Representative Scott Garrett got a lot of press today for his involvement in the hearing with Treasury Secretary Tim Geithner and Fed Chair Ben Bernanke yesterday. You can read his opening statement here.

Here's my personal favorite comment he made in an interview, as reported by the National Journal:

Rep. Scott Garrett (R-NJ): "We've heard the story before under the prior secretary of Treasury, where he said he had a plan, it is the only plan, and that plan will work. ... I guess he's suggesting that it's something to do with will that has to get it done. No. I think it really has to get down to what's in the weeds of the plan and whether the plans are actually good ideas from day one"

We're talking trillions of dollars, and people have to ask questions.

Garrett Gets a Favorable Op-Ed

While it's not uncommon for Representative Scott Garrett to find himself the focus of editorials, columns, and blog posts (clammyc rips him today on Blue Jersey); it's rather uncommon for him to get 1,500 words of praise.

However, that's happened over at PolitickerNJ, where former EPA Region 2 Administrator Alan Steinberg talked about bailouts and credit default swaps. Here's a taste:

I first met Scott Garrett when I began my service as Senior Policy Advisor on the Assembly Republican Staff in June, 1992 while he was serving in his second term as an Assemblyman. Over the past 17 years, both in his capacity as an Assemblyman and as a member of the U.S. House of Representatives, I have had the good fortune to work with Scott on numerous issues, and my respect for his intellect, character, ethics, integrity, and courage has grown.

[snip]

Every two years, the Trenton insiders of both parties talk of the ultimate electoral demise of Scott Garrett. To paraphrase Mark Twain, reports of Scott’s political death continue to be exaggerated. I recently had a conversation with a prominent New Jersey political journalist in which he stated that key Republicans want to sacrifice Scott’s 5th District seat in the next reapportionment. Nothing could be a more politically suicidal move for the New Jersey GOP than that.

Although not a constituent, or donor, Steinberg is obviously starting the fight of 2011 now on Garrett's behalf.

Stewart vs. Cramer

Wow. Daily Show host Jon Stewart gets his claws into Jim Cramer. It gives some fascinating insight as to how the market has been manipulated and how we the people were hurt by the Wall Street regulars. It also speaks directly to the need for real journalism.

Representative Scott Garrett found himself on TV with Donnie Deutsch talking about the TARP and other things. It's an interesting session, that Donnie starts off by ripping, albeit nicely, some of Garrett's previous statements.

It's Good to Be Ranking

As I had mentioned when he got the nod, our Representative Scott Garrett is likely to get more opportunities to talk about the financial crisis now that he is Ranking Member of the committee which oversees the capital markets, as well as Fannie Mae and Freddie Mac. Well, as derided as it is at times, there is no more widely read newspaper than USA Today.

Today, they published an Op-Ed from Garrett about his opposition to further bailouts of the banks. Once again, he showcases his sarcastic/snarky side. Who knew?

Here's the Op-Ed:

President Obama's address to Congress on Tuesday night foreshadowed the next development in the Troubled Asset Relief Program (TARP) blockbuster series — TARP II: Bigger and Badder.

Unfortunately, as tends to be the case with most sequels, this one promises to be worse than the original. The lead characters might have been replaced with different actors (Barack Obama is now playing the role of the president, and his dutiful Treasury secretary sidekick is Timothy Geithner, who played a supporting role in the first feature), but the plot and outcome, like most sequels, has the potential to be even worse than the first.

Supporters of further government intervention shout cries of "government responsibility." They claim it's the government's "responsibility" to use as much money as needed to correct the ills of the marketplace.

Well, so far, we've had a government bailout of Bear Stearns, Fannie Mae and Freddie Mac, American International Group, the automakers and banks in general — through TARP. We've also spent about a trillion dollars in various "stimulus" packages over the past year. At the signing of the stimulus package last week, the president hinted that this spending might not be enough, leading to the rise in speculation about stimulus II.

If the first three or four trillion dollars didn't do the trick, what makes us think the next trillion will fix things?

Japan spent an entire decade in the 1990s chasing that level of "enough" spending. The Japanese accumulated a massive level of debt, but it never was quite "enough" to reach the magic level to trigger an immediate economic turnaround. If more money were simply the answer, we'd already be out of this mess.

Additional government intervention does nothing to strengthen our financial markets or encourage private investment. By sending mixed signals to Wall Street, Washington is causing capital to remain on the sidelines. We don't need, nor can we afford, continued ad hoc government interference.

Until investors are clear about the government's intention with regard to future market interference, including ceasing the selection of winners and losers in the market, confidence will not be restored to the financial sector. Government should unleash the potential of private capital by getting out of the way.

Garrett Hearts Beer Brewers and Drinkers

Here's a measure I hope Representative Scott Garrett can help get passed, and a tax break I think most of us can get behind. The day before Valentine's day, Garrett joined a number of Representatives in co-sponsoring a bill calling for the Federal Excise tax on beer to be slashed in half (Rep. Bill Pascrell was an original co-sponsor).

This is much more about jobs and fairness than the penny or two per bottle the tax costs us as consumers. Using the most recent numbers I could find, as it stands now, the average micro-brewery in the US is paying an average of about $16,584 in federal excise taxes on their product, in addition to their income taxes and myriad of state, county and local taxes.

Beer is easily one of the most overtaxed consumer products in America.

Having known more than a few people that have worked at breweries, especially the micro variety, they are often times staffed by part-timers passionate about the craft and the product they produce. Kids working their way through college. Parents making a little income on the weekend. This kind of targeted tax break could be a huge boost to these small, passionate, job producing businesses.

Garrett and Pascrell taking up this cause now comes at important time for all of us who like well crafted beer. In a time of economic downturn and increased raw material costs, states like Oregon have gone off the deep end by considering increasing their excise tax 1,900% ($49.61 per barrel from $2.61). Other states like Idaho, Kentucky and New York either have or are thinking about increasing excise taxes even further.

With breweries as close as New York threatening to close due to their state's actions, New Jersey's relatively low excise tax could attract new business. If breweries really do close their doors, it's not hard to imagine their equipment finding it's way to New Jersey. Every time I see an abandoned factory here, I think about a brewery I used to frequent in Michigan that was able to turn an eyesore into a community gathering place.

Granted, we'd have to deal with our regulatory mess that somehow has only fostered 14 breweries in a state with almost 9 million people, but that's another post for another day.

In the meantime, cheers to Garrett for joining Pascrell in this effort.

Garrett Still Doesn't Get Housing Crisis

With President Obama announcing his latest plan to stop foreclosures, by allowing certain people to refinance their mortgages through Fannie Mae and Freddie Mac, it makes sense Representative Scott Garrett would find himself in the news. Seeing as he's the Ranking Member of the subcommittee that oversees Fannie and Freddie, it makes perfect sense. Here's Garrett's quote on the plan from CQ Politics:

“I think that this plan will only delay inevitable future waves of the foreclosure crisis, rather than stem the tide,” said New Jersey Republican Rep. Scott Garrett , a member of Frank’s panel. “It provides no incentives or rewards to those homeowners who have been diligently making their mortgage payments, or to those who recognized their financial constraints and chose to rent a home rather than buy one.”

CQ should have given him the proper title, but that aside, it gives another example of why Garrett simply does not get a major factor in the housing crisis. I've never understood why the Republican party has taken the stance the housing crisis was caused solely by people who failed to recognize "their financial constraints".

The bottom line is that the numbers so many mortgage brokers showed people did work, at first, but that they didn't have to worry about when they wouldn't because they'd be able to refinance before then.

I know, because I was at one point trained to do this as a loan originator. It's one of the things I'm absolutely the proudest about being a complete and utter failure at; I never closed a loan and actually talked people out of refinancing. However, lots of people found this was an easy way to make money, and I suppose I could have, too, if I didn't have a conscience.

60 minutes had an amazing piece on the system and the bank that ultimately brought down Wachovia: World Global.


Watch CBS Videos Online

While I doubt Garrett will actually watch it or believe it, it's how it worked. It concerns me greatly that to this date I have yet to see a substantial press clipping or speech acknowledging the systemic practice of getting people into these loans. Garrett sits at the crossroads of our economic recovery, yet seems unwilling to look at where we really were in order to prevent us from ever traveling that path again.

Garrett Gets His Susan Powter On

Maybe I'm dating myself slightly, citing the slightly scary woman screaming at us to "Stop the Insanity", but that's the first thing that came to mind when reading the opening of the latest Op-Ed by Representative Scott Garrett published by the Record.

AN APHORISM most often attributed to Albert Einstein goes: "The definition of insanity is continuing to do the same thing over and over again, and then expecting different results." By this definition, then, the "stimulus" package approved by the House Friday (and which also seemed headed toward Senate approval late Friday) is fiscal insanity.

It's amazing how the arguments of the minority party mirror each other in such a bi-partisan manner. Democrats were saying the same things about Iraq and all of the budgets Garrett voted for over the years. Let's not dwell on that, shall we, because Garrett's own words in essence shoot down the entire Op-Ed a bit further down.

Among economists who study fiscal policy closely, the evidence is conclusive: Massive increases in deficit spending during a recession do not stop a recession and can, in fact, be very harmful to a nation's finances in the long run.

The odd thing about this is that Garrett goes on to cite the tax cuts passed around the 1981 and 2003 recessions as what should be given credit for pulling us out of those recessions. This is a bit misleading.

The tax cuts Reagan passed in 1981 led to our national debt exploding 186% by the time he left office. The interesting thing is that the Bush tax cuts "only" led to 48% explosion in the national debt. If you went to the Midwest, you'd find plenty of people that would say we've never recovered from 2003.

The bottom line is that both parties are addicted to deficit spending, they just have different names for it. Garrett and his gang want you to believe you're getting something for nothing, while your grandchildren will be asking you what they're paying for. Meanwhile, the Democrats are telling you what you're getting, and hoping you'll explain it to your grandchildren for them.

For another take on Garrett's piece, check out clammyc's post over on Blue Jersey.

Feeling Stimulated?

As expected, Representative Scott Garrett voted against the stimulus package yesterday. What was surprising, at least to me, was that so did the entire Republican delegation. Maybe it was a case of being political sore losers; or maybe all of the Democrats touting the "we won" mentality hurt their feelings. Or maybe both.

Granted, this is only the first vote and we won't know what the actual stimulus package is going to look for a couple of weeks, but it's kind of a tragic statement on politics that they're all still acting like a bunch of seventh graders down there. Symbolic vote or not, it really was a bad example for all of those new to politics. More than anything else, America voted for not only a change in policies but a change in tone.

There's no proof the stimulus will work. We'd like to think it would, but there's no proof. People talk about the jobs it will create and the money that will flow back into the economy, but unless people spend their money on made in the USA products it's little more than a one off.

Then there's the matter of corruption and waste. Herb Jackson over at the Record did a great write-up on what New Jersey would be getting from the bailout. One giant red flag for all of us should be the $420 million that will go into the coffers of the at times corrupt and often wasteful New Jersey School Construction Corporation. That's just one example, but it's something we'll have to be vigilant over. Pouring money we're borrowing from ourselves into corrupted hands won't help recovery.

Granted, President Obama will attempt to use Recovery.gov to help us see where the money is going, but as with the money we've poured into the quicksand in Iraq, knowing it's gone and getting it back are two different things. I don't know how many people they're going to staff it with, but our state alone will probably need a small army to watch over and report on the progress and use of our funds.

I hope the eventual package works, I really do. I just wish that the politics of it all could be put aside. Democrats being boastful and Republicans pouting isn't going to solve our economic crisis.

We need the best solutions, no matter where they come from.

Garrett Makes a Funny

Last night, Representative Scott Garrett took to the floor to explain all of the reasons he doesn't like the Democrats' Stimulus package. During the exchange with Rep. Gingrey, Garrett made a bit of a joke at Treasury Secretary Tim Geithner's expense:

We could have our new Treasury secretary, if he wanted to, he could go out and buy a TurboTax for every American in this country so those people would be able to figure out how their taxes are done and make sure that they pay their right taxes. That is what we basically granted when we passed last Wednesday an additional $350 billion, again, over my objection, and I believe over your objection as well, when that TARP bill went through.

For those that had missed it, one of Geithner's excuses for not paying his taxes was that he had used TurboTax.