Addison and Short Fuse report that today is the day they will be sending a copy of companion book to I.O.U.S.A. to every member of Congress. Many of our dear readers wrote in with...well, not necessarily words of encouragement. Turns out most think that the members of Congress (with a few notable exceptions - see today's guest essay) don't read anything at all. And to further prove that point, we got this note from Dan Denning, from the helm of the DR Australia:
"I'm sure you've all had a chance to go through the bill the Senate passed last night 74-25. You can find it here.
"Of course, a spending Bill cannot originate in the Senate because as we know, Article 1, Section Seven of that useless piece of paper (the Constitution) says: 'All bills for raising revenue shall originate in the House of Representatives; but the Senate may propose or concur with amendments as on other Bills.'
"So the Senate lobotomized a Bill already passed by the House, which included, among other ridiculous spending provisions, Section 503 (EXEMPTION FROM EXCISE TAX FOR CERTAIN WOODEN ARROWS DESIGNED FOR USE BY CHILDREN.)
"According to Bloomberg : 'Senators attached a provision repealing a 39-cent excise tax on wooden arrows designed for children to an historic $700 billion bank rescue that is likely to pass tonight. The provision, originally proposed by Oregon senators Ron Wyden and Gordon Smith, will save manufacturers such as Rose City Archery in Myrtle Point, Oregon, about $200,000 a year.'
"Funny.
"But...there are some other portions of the Bill that look surprisingly bold, perhaps even illegal. I wonder.
"First, the totally legal but absurd increase in the statutory limit on the public debt, from Section 122: Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting '$11,315,000,000,000'.
"Seriously.
"Thank god for statutory law. If you don't like it, you can just change it.
"Other sections you might want to have a gander at include section 115, detailing the Secretary's 'Graduated Authority to Purchase.' Passage of the bill gives him $250b to play with. Then, if the President requests it and Congress approves, he can request as much as $350b. After that, it's $700bn, again subject to a request by the President and approval by the Congress.
"Please note, however, that $700bn is not the ceiling on the Plan. The language says $700bn is the most the President and the Secretary can request...at any one time.
"So this is bailout by installments. But $700bn is not the end. It is just the beginning, provided Congress signs off.
"And the rest of the section makes it hard for them to not sign off by severely limiting debate on the requests submitted by the President. You don't often see Congress agree on rules for floor behaviour in the House and the Senate in a Bill. The rules committee does that in the House and the Senate sort of makes it up as it goes along.
"But this bill specifies the entire process by which a request from the President (Bush or Obama) MUST be handled by the House and the Senate. No motions to reconsider. No debate.
"And Congress is even trying to cut out judicial review. That's in Section 119.
"It starts out promisingly enough by saying that 'Actions by the Secretary pursuant to the authority of this Act shall be subject to chapter 7 of title 5, United States Code, including chapter 7 of title 5, United States Code, that such final actions shall be held unlawful and set aside if found to be arbitrary, capricious, an abuse aside if found to be arbitrary, capricious, an abuse of discretion, or not in accordance with law.of discretion, or not in accordance with law.'
"But what is law anyway?
"Either way, Congress is severely limiting the circumstances under which the Treasury can be challenged. Is that legal? Just asking...not that it matters anymore."
Bill Bonner
for The Daily Reckoning Australia
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About the Author
Best-selling investment author Bill Bonner is the founder and president of Agora Publishing, one of the world's most successful consumer newsletter companies. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail The Daily Reckoning.
