GOP lawmaker was for ‘Wall Street bailout’ before he was against it

Simpson “voted to repeal the Wall Street bailout and repay taxpayers”

–voiceover of new ad for Rep. Mike Simpson (R-Idaho)

This is an intramural Republican fight, but it’s an interesting one. Facing a tea party challenger who has financial backing from the conservative Club for Growth, Rep. Simpson has fought back against the attacks with what he calls “the truth.” A Web site sponsored by his campaign, called idahofactcheck.com, amplifies the message of the ad:

Club for Growth claim: Simpson voted for the taxpayer bailout of Wall Street

Idaho Facts: Mike voted to REPEAL Troubled Asset Relief Program and require the money be repaid to taxpayers (Roll Call Vote 25, 2009)

This seems to be a sharp disagreement. What actually happened?

The Facts

Lawmakers must cast many votes, often on bills with slight variations in language, which allows lawmakers (and their opponents) to pick and choose what they want to highlight. As former Sen. John F. Kerry once unartfully put it: “I actually did vote for the $87 billion before I voted against it.”

There’s no doubt that Simpson voted for the $700 billion Troubled Asset Relief Program (TARP), which was initially proposed by the George W. Bush administration in the midst of the 2008 economic crisis. The Associated Press reported that Simpson chided his fellow Idaho Republican lawmaker, then-Rep. Bill Sali, for hesitating to back congressional action.

“What’s his answer, to let the economy go down?’’ Simpson said. ‘‘Sometimes Bill puts himself in a philosophical position that’s untenable that he can’t get off of. We got into this mess because of the failure of government oversight. Consequently, I think there’s a role for government to play in trying to get us out of this, as much as I don’t like it.’’

Subsequently, in 2010, Simpson continued to back his vote, in a town hall meeting and in a primary debate—moments recorded in video clips that Club for Growth has posted on You Tube.

As Simpson put it in the debate:

“The financial system depended on this. This was not a bank bailout, this was a financial and credit system bailout. We had credit being frozen in this country and we were looking at potentially and I think most economists will agree probably 25-30 percent unemployment in this country if we did nothing. I’m unwilling to accept that. So we did what we thought was necessary. If there are other ideas out there that we could’ve done to free up this credit situation, we would have looked at those options also. But to just sit back and say ‘Let em fail.’ That was not an option I was willing to accept.”

Oddly, though in 2010 Simpson said it “was not a bank bailout,” now his own campaign ad calls it a “Wall Street bailout.”  And it says that in 2009 he voted to repeal the law. So what is that about?

This is yet another vote, which took place on Jan. 21, 2009, when Democrats controlled the House of Representatives. It was a failed procedural vote to direct a committee to terminate half of the funding and develop a repayment plan for the money that had been spent.

In other words, it was not an actual vote on a piece of legislation, though that did not stop the Club for Growth from offering a “scorecard” rating of the motion, which is described in Club for Growth literature as “Repeal & Repay TARP.”

Not coincidentally, those are the same words used in the campaign ad. In other words, Simpson voted exactly as Club for Growth had demanded in 2009.

“That’s amusing, but it ultimately doesn’t change the substance of the actual vote or the obvious intent in the present day TV commercial,” said Barney Keller, communications director for the Club for Growth. “It’s just shorthand.”

Simpson spokeswoman Nikki Watts, saying the lawmaker has been “constantly consistent,” provided a copy of a statement that Simpson issued a few days after this vote, regarding a related resolution that disapproved additional TARP funding (but which was not binding). In the statement, Simpson said he was “disgusted” that the funds were being used differently than originally intended, adding: “I cannot support any continuation of this program without clear and fundamental changes to ensure that the taxpayers’ investment pays long-term dividends.”

This is a thin needle to thread, but essentially Simpson voted for TARP and at times has defended the vote as absolutely necessary at the time, but gave himself wiggle room to say that the money was not properly spent and should be rescinded. However, as far as we can tell, he did not emphasize his 2009 vote against TARP until recently. He also has not said he regretted the initial vote; he is just silent on it.

ProPublica, which has closely tracked the spending of government bailouts, reports that so far the U.S. government has earned nearly $15 billion in profit on TARP, having disbursed $421 billion and received $436 billion in refunds, dividends, interest and other proceeds. (In 2010, the $700 billion spending cap for TARP was reduced to $475 billion, but not even all of that was spent.)

In other words, there’s a bit of irony here. The “long-term dividends” Simpson demanded in that 2009 statement have actually been received. He could have kept defending his vote and called it a success story, though apparently that’s not a message that resonates among Idaho Republicans.

The Pinocchio Test

Simpson, by picking and choosing what votes he wants to highlight, is misleading Idaho voters. He should not emphasize the vote to end TARP without acknowledging that he voted for the program in the first place. At the same time, it is noteworthy that Club for Growth at time signaled the 2009 vote against TARP was significant enough to be counted on its scorecard. So, in the context of this campaign, the group cannot dismiss the vote as insignificant.

The bottom line: Simpson was for TARP before he was against it. Thus his ad and his campaign Web site are missing important context.

Two Pinocchios

 


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Glenn Kessler has reported on domestic and foreign policy for more than three decades. He would like your help in keeping an eye on public figures. Send him statements to fact check by emailing him, tweeting at him, or sending him a message on Facebook.
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