During the last serious economic downturn in 2008 and 2009, Presidents George W. Bush and Barack Obama pushed forward more than $1 trillion in spending designed to revive the economy by doing everything from buying up toxic assets from financial institutions and spending more on public infrastructure to bailing out state and local governments. Much of it was controversial. Many political conservatives complained bitterly about this level of federal government involvement in the private sector, and there continues to be debate about how many jobs that effort saved (although the general consensus remains that American Recovery and Reinvestment Act of 2009 likely saved 1.5 million jobs or more).
But the one thing those programs had was some degree of independent oversight. Whether one approved of the Troubled Asset Relief Program or not, those banks and other financial institutions that benefited from taxpayer-funded bailouts were identified for all to see. Not only was some level of transparency mandated under TARP, but there was a well-funded watchdog, a “special” inspector general assigned to monitoring the asset transfers and who reported directly to Congress. More than once, that particular individual, former prosecutor Neil Barofsky, produced reports critical of the Obama administration’s handling of the program it had inherited. President Obama did not fire Mr. Barofsky. Nor did Congress. His involvement helped Americans have confidence in the fairness and legality of the government’s actions.
That experience ought to inform how the United States moves forward now, but there are worrisome signs it isn’t. The $2.2 trillion Coronavirus Aid, Relief and Economic Security (CARES) Act does not require disclosure of the names of businesses that receive Small Business Administration loans, a program that has already received about a half-million applications. Other CARES programs do require such disclosures, but the names can be withheld if the Federal Reserve chairman deems it appropriate. And while the CARES Act does include an inspector general and a committee of Congress conducting oversight (although less well-funded than under TARP), the Trump administration has already attacked that provision. Administration officials now insist that any reports to Congress would have to be first scrutinized by the White House and a key candidate for the watchdog role was demoted by President Donald Trump who has, instead, nominated one of his own lawyers, associate White House counsel Brian Miller, for the post.
Such meddling leaves open the possibility that taxpayer money might be used for self-serving purposes, with the Trump administration potentially directing the enormous sums toward political allies and away from those the president perceives as foes. Certainly, Mr. Trump’s dislike of independent oversight was illustrated by his decision earlier this month to fire Michael Atkinson, the intelligence community’s top watchdog, because Mr. Atkinson did his job by informing Congress about the whistleblower report on Mr. Trump’s infamous Ukraine phone call. More recently, the president has been critical of the Department of Health and Human Services’ inspector general for daring to point out that the country’s hospitals were ill-prepared for the coronavirus outbreak. House Democratic leaders say they are now looking into ways they can restrict Mr. Trump’s authority over inspector generals.
No doubt the White House relishes the opportunity to cast their disagreements in matters of oversight as a purely partisan exercise. But even Republican voters are going to notice if, whether deliberately or through circumstances, it becomes clear that Mr. Trump’s closest allies have directly benefited from stimulus spending denied others. Senate Republicans must not allow the president to continue down this path.
Congress needs to stick to its guns and strengthen CARES Act oversight. At the very least, Americans need the assurance that the supervision will be as robust as the scrutiny given TARP. That can start with a truly independent inspector general, not someone beholden to the president. That person also requires adequate resources and a guarantee he or she won’t be fired if untoward behavior is uncovered. This is not too much to ask, not when such an enormous amount of money is involved. A lot of people are hurting right now and scared. A global pandemic and a crashing economy will do that. The last thing we need is the added worry that there’s no check on potential public corruption in the nation’s capital.
The Baltimore Sun editorial board — made up of Opinion Editor Tricia Bishop, Deputy Editor Andrea K. McDaniels and writer Peter Jensen — offers opinions and analysis on news and issues relevant to readers. It is separate from the newsroom.