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14 February 2013

Jack Lew's Signature Is Probably The Best Thing About Him...And, Even It Sucks.

Senator Jeff Sessions' outstanding letter on Jack Lew's nomination to be Secretary of the Treasury:

United States Senate
Committee on the Budget
Washington, DC 20510-6100 

February 12, 2013

Dear Colleague: 

Truth matters when Congress and the American people hear our top leaders discuss important issues.  

I am writing today to all of my Senate colleagues, Democrat and Republican, to express my severe reservations about Jack Lew's nomination to be Secretary of the Treasury.  As you know, this position is the premier financial office in the United States, and we depend upon that person for honest and objective information about the financial condition of the country. 

Unfortunately, during his time as Director of the Office of Management and Budget, Mr Lew made statements in a series of media appearances - and repeated before the Senate Budget Committee - that are so false and so outrageous as to disqualify him from serving as Secretary of the Treasury.  Certainly, I know this is a serious charge, but hear me out.  As Senators consider this nomination we much consider the importance we place on truth and how we will react if it is plainly not adhered to.  Is it merely business as usual?  OMB Director Lew looked the American people in the eye and, without any disqualification, made what is surely the greatest financial misrepresentation in history.  A statement like this, if made by a corporate officer, would result in civil and criminal liability.

Attached to this letter is a table from Mr Lew's own FY 2012 budget submission from February of 2011.  Tables S-1 and S-14 clearly show the following to be the case:  the proposal would have increased the gross debt of the United States by $13 trillion, that the smallest annual deficit would have been $607 billion, and that the deficit in the last year of the budget would have grown to nearly $1 trillion.  Also attached is Table S-4, which shows that the plan would have increased total spending by 53% and mandatory spending by 81%.  Under the documents presented to Congress by OMB Director Lew, the debt would have risen from $13.5 trillion to $26.3 trillion.  (CBO's independent analysis found deficits would have been even higher.)

Yet, despite these figures - pulled from his own budget document - Mr Lew made the following comments on national television:  

"Our budget will get us, over the next several years, to the point where we can look the American people in the eye and say we're not adding to the debt anymore; we're spending money that we have each year, and then we can work on bringing down our national debt."  (CNN, 13 February 2011)  

To the millions of Americans listening, the words could have been understood in only one way.  I was shocked by the misrepresentation.

Three says later, before the Budget Committee, I asked him if it was an accurate statement and Mr. Lew replied:  

"It's an accurate statement that our current spending will not be increasing the debt... We've stopped spending money that we don't have."  

This was not a one-time affair.  Mr Lew repeatedly made these false statements, designed to mislead the very people we represent on the most serious issue the nation faces.  For instance, Mr Lew also said:  

"If we're able to reduce the deficit to the point where we can pay for our spending and invest in the future, that is an enormous accomplishment.  This budget has specific proposals that would do that." (NPR, 15 February 2011)  

In another instance, he stated:  "It (the Lew budget) takes real actions now so that between now and five years from now, we can get our deficit under control so that we can stabilize things so that we're not adding to the debt anymore." (CNN, 14 February 2011)

The budget proposal Mr Lew authored was panned by virtually every editorial board in the country.  Erskine Bowles, co-chair of the President's own debt commission, lamented that the plan went "nowhere near where they will have to go to resolve our fiscal nightmare."  

How can we install as our Treasury Secretary a man whose signature financial achievement was presenting a budget that was almost universally repudiated by every major newspaper, commentator, and budget analyst in the country -- as well as by a unanimous vote in this chamber?  How can we support someone who engaged in a purposeful and deliberate campaign to mislead this body about its contents?  Confirmation of Mr Lew would send the message that Congress does not insist on honesty in our public servants, and that such actions are grounds for promotion.  

Other concerns abound as well.  Mr Lew's background is lacking the credentials ordinarily needed for a Treasury Secretary nominee.  As Larry Kudlow wryly observed, "Give me a phone book and I'll find somebody more qualified."

Mr Lew's curiously enriching time at Citigroup only raises more questions.  He led a division (Citigroup's Alternative Investments unit) that was at the center of that institution's multi-billion dollar losses, which ultimately led to it being the largest beneficiary of the taxpayer-funded bailout.  And Mr Lew profited greatly.  He received a million-dollar bonus.  The Wall Street Journal noted that Mr Lew's "only business credential is a stint at the most troubled too-big-to-fail bank."  Indeed, his core experience is as a political staffer and insider whose most notable actions have been to prevent any reform of surging government programs.

Finally, Mr Lew served as a Director of the Office of Management and Budget during 2010, 2011, and part of 2012 when the White House defied the Federal law, authored by Congress just a decade ago, that requires the President to submit legislation responsive to the Medicare Trustees' funding warning.  Forty-four Republican Senators have previously sent a letter to President Obama detailing the Administration's violation of this law and demanding that legislation be sent to bring the Administration into compliance.  That request was ignored.  I, along with House Budget Committee Chairman Paul Ryan, have sent requests for this information as well.  Most recently, members of the Senate Budget Committee wrote to the acting OMB director asking for information pertaining to Mr Lew's role in violating federal law during his tenure at OMB, along with yet another request for the required Medicare legislation.  The Administration has still failed to provide this material.  Given this history of noncompliance, and given that Mr Lew will be Chairman of the Medicare Trustees if confirmed, I believe Congress would be justified in asserting its authority and withholding consent to consider Mr Lew's nomination until such time as the Administration sends detailed legislation directly responsive to the Medicare statute in question.

At the center of this nomination is the question of whether Congress is willing to defend itself as a co-equal branch of government that expects the laws we authored to be enforced and expects the nominees we confirm to tell us and our constituents the truth.  Confirming Mr Lew would also represent a direct threat to the financial well-being of our constituents, and our nation's seniors, given that Mr Lew is apparently under the impression that political considerations are more important than complying with federal law or providing an honest assessment of the financial peril facing our country.

I have been here for more than a few years and heard erroneous statements, twisting of facts, and puffing.  There is a certain politician's license in these matters, but this was not error or puffing.  It was a key moment in a deliberate artifice to cause the American people to believe that our President's budget put us on a sustainable fiscal path when it was nowhere close.  On this issue of our time, Mr Lew dramatically failed in his duty of candor.  He must not be rewarded with a promotion.

My Budget Committee staff is at your disposal for any further information you would like on any of these points.  Thank you for your consideration.  

Very truly yours, 

Jeff Sessions, United States Senator


"He “didn’t know” that his money was being housed in the Cayman Islands? That’s odd; Team Obama didn’t let Mitt Romney get away with that one, no sir!"

Mr Citibank is lying.

 And, THAT'S the problem, Mr Hypocrite!

“This is a corporation that finds itself in financial distress due to recklessness and greed. Under these circumstances, it’s hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. I mean, how do they justify this outrage to the taxpayers who are keeping the company afloat? [I've asked Treasury Secretary Geithner to] pursue every single legal avenue to block these bonuses and make the American taxpayers whole. It’s about our fundamental values. All across the country, there are people who are working hard and meeting their responsibilities every single day, without the benefit of government bailouts or multimillion-dollar bonuses. You’ve got a bunch of small-business people here who are struggling just to keep their credit line open. And all they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules. That is an ethic that we have to demand. I’m choked up with anger here.”

- President Barack Obama, 16 March 2009

He wasn’t “choked up with anger” when Jack Lew accepted a $1 million bonus after Citibank was bailed out nor was he when he nominated an unqualified, disingenuous political hack like Lew.

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