Obama faces congressional anger about economy
Friday, November 20, 2009
Growing discontent over the economy and frustration with efforts to speed its recovery boiled over Thursday 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 Congressional Black Caucus, exasperated by the administration's handling of the economy, unexpectedly blocked one 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 F. Geithner, including a call for his resignation.
"Conservatives agree that as point person, you failed. Liberals are growing in that consensus as well," said Rep. Kevin Brady (R-Tex.). "For the sake of our jobs, will you step down from your post?"
Rep. Michael C. Burgess (R-Tex.) took a different tack. "I don't think that you should be fired," he told Geithner. "I thought you should have never been hired."
Even Sen. Charles E. Schumer (D-N.Y.), a friend of the administration, suggested that Geithner had been inconsistent in addressing China's practice of keeping its currency low against the dollar.
And Rep. Peter DeFazio (D-Ore.) said Wednesday on MSNBC that he thinks Geithner should step down, pointing to his handling of the aftermath of American International Group's meltdown.
Across Capitol Hill, senators signaled their opposition to rushing regulatory reform. While some Democrats voiced reservations about parts of the bill, Republicans went further, faulting Sen. Christopher J. Dodd (D-Conn.) 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 Thursday was an amendment by Rep. Ron Paul (R-Tex.) that would subject the Federal Reserve to unprecedented scrutiny. The amendment, which won bipartisan support in the House Financial Services Committee despite the reservations of administration officials, 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 measure -- are looking to increase oversight of an institution they consider partly to blame for the financial crisis. Federal officials and many private economists worry that the amendment could make future central bank policymakers reluctant to take unpopular steps to prevent inflation or support the economy for fear of second-guessing by Congress and government auditors.
The House committee had been set to vote to send the final piece of its regulatory reform package to the House floor after months of debate. That is, until the committee's chairman, Rep. Barney Frank (D-Mass.), 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.