According to an article in the Star-Telegram, Treasury Secretary Timothy Geithner, announced new rules that limit lobbyist influence on the proposed $700 billion financial rescue program for an economy that is facing scores of bankruptcies and foreclosures.
The article said:
Obama administration officials said they go farther than the lobbying rules imposed by the Bush administration and are designed to ensure that bailout money is distributed with the goal of promoting the health and stability of the financial system.
“American taxpayers deserve to know that their money is spent in the most effective way to stabilize the financial system,” Geithner said in a statement. “Today’s actions reaffirm our commitment toward that goal.”
As we mentioned in a previous post this week, lobbyist are hard at work attempting to prevent the bankruptcy law from being changed to allow mortgage loan modification during bankruptcy. I’m not sure if these particular rules will prevent them from changing the “hearts and minds” of our legislators considering bankruptcy reform; but at least the new rules may slow them down a bit.
Here are some of the lobbyist rules being implemented:
Officials overseeing the bail out are required to certify that each investment decision was based only on objective criteria and the facts not lobbyist influence.
The rescue program will be required to publish a detailed description of the review process conducted in making the awards, and no bank will be considered for an award unless it was recommended for the assistance by the firm’s primary regulator.
The new rules come in the wake of reports that as certain companies received bail out money they increased (not decreased) their lobbying efforts despite facing bankruptcy and large profits losses. I don’t know if this is enough to stifle the power of lobbyists; but it is a step in the right direction.