Republicans Say Recovery Act Jobs Claims Misleading
Earl Devaney, chairman of the Recovery Accountability and Transparency Board, charged with tracking stimulus dollars, said that there are several inaccuracies in the statistics on jobs saved or created through the Recovery Act and errors in filing reports submitted by stimulus fund recipients on how the money has been spent. Testifying before the House Committee on Oversight and Government Reform on Thursday, he said he could not certify whether the job numbers were correct.
Republicans on the panel used the hearing as an opportunity to criticize the Obama administration for making what they believe to be misleading jobs claims. Recalling a statement made by Secretary LaHood that the Recovery Act has saved or created direct 640,000 jobs so far, Rep. Darrell Issa (R-California) said to Devaney, “To characterize, he may be a little overzealous in saying real, identifiable, direct and, in fact, it’s just a damn estimate, isn’t it.â€
A Government Accountability Office report released on Thursday also identified “a range of significant reporting and quality issues†regarding recipient data on the Recovery Act Website. It found more than 3,000 reports that “showed no dollar amount received or expended but included more than 50,000 jobs,†the report said.
During a conference call that evening, the White House senior advisor Ed DeSeve reminded reporters that Vice President Joe Biden had warned all along that the tracking system was an unprecedented undertaking and would not be perfect but the overall impact of the stimulus is irrefutable.
The hearing can be viewed here. GAO Finds Millions in Contract Fraud
The House Committee on Small Business convened a hearing on fraud, waste, abuse and mismanagement of programs under its jurisdiction on Thursday. The House has adopted a requirement for all committees to do so on a quarterly basis.
“These hearings are an important tool for reassuring progress and gathering information. In the past, they have been enormously useful not just for spotting SBA’s problem areas, but also for solving them,†said Rep. Nydia Velazquez (D-New York), who chairs the panel.
Gregory Kutz, speaking on behalf of the Government Accountability Office, submitted a report that found that the Service-Disabled Veteran-Owned Small Business Program (SDVOSB) is vulnerable to fraud and abuse, which could cause veterans to lose contracting opportunities to ineligible firms. The program was created to provide government-wide sole-source contracts to honor the service and sacrifice of veterans with service-related disabilities.
Ten case-study firms that were ineligible to participate in the program received approximately $100 million in contracts through fraud or abuse. The GAO’s investigation also found that the government doesn’t have effective fraud-prevention controls for the program in place.
“The culture of the SBA is that we will not be the agency of fraud, waste, abuse and mismanagement,†said SBA administrator Karen Mills. “We have an aggressive, new attitude towards this; it is explicitly one of our priorities.â€
Rep. Sam Graves of Missouri, the committee’s ranking Republican, said, “I am outraged that fraud in this federal program, intended to benefit our brave soldiers, means that fewer opportunities are available to our service-disabled veterans.†He vowed to take “aggressive legislative action†if the SBA and Veterans Administration don’t move quickly to prevent the abuses.
To view excerpts from the hearing, click here. Senate Banking Committee Examines Overdraft Fees
During a hearing this week to examine the fees charged to customers enrolled in overdraft coverage programs, the Senate Banking Committee took financial institutions to task about not asking customers’ permission when adding coverage.
“Let’s be clear.  It is a responsibility each one of us has to manage our personal accounts as well as we possibly can and to spend within our means,†said Sen. Christopher Dodd (D-Connecticut), who chairs the panel.  “But lending institutions often add overdraft coverage to consumer accounts without informing consumers or giving them a choice.â€
Dodd has introduced a bill called the Fairness and Accountability in Receiving Overdraft Coverage Act, which aims to protect consumers by limiting the number of monthly and annual overdraft coverage fees banks can charge; requiring that fees be proportional to the cost of processing the overdraft; and stopping institutions from manipulating the order in which they post transactions in order to rack up extra fees. Customers would have to be notified when they’re overdrawn and be given the option of being notified by email, text or traditional mail. It also would require that customers be warned if an ATM or branch teller transaction will overdraw their account, and be given the chance to cancel the transaction.
“After it came out in the press that I was working on this legislation, a few of the large institutions took steps toward responsible reform,†said Dodd.
John Carey, chief administrative officer at Citibank, testified that his bank has instituted a cap of four fees per day, which also includes insufficient funds fees.
“We believe that consumers need
transparency, especially at the transaction point in order to make informed choices about incurring such fees. That is why we support additional efforts to improve consumer awareness regarding overdraft protection and alternative payment options to help people be smart and responsible about money management,†he said.Rev. Jackson Slams Black House Member
In an attempt to make peace with Rep. Artur Davis, the Rev. Jesse Jackson has backed away from statements he made Wednesday night calling out the Alabama Democrat for voting against the healthcare reform bill that passed earlier this month.
“We even have blacks voting against the healthcare bill,†Jackson said at a Congressional Black Caucus reception in celebration of the 25th anniversary of his presidential bid. “You can’t vote against healthcare and call yourself a black man.â€
However, by Thursday night Jackson had spoken to Davis, according to news reports, to “assure him of my abiding admiration of him as a leader who is engaged in a huge challenge. I offer no challenge to his integrity as a leader. Representatives should all vote their conscience in the interest of their constituency.â€
Before their conversation, Davis, who is running for governor of his home state, said he has a lot of respect for Jackson, but he’s not running to be the leader of or spokesman for one community and has to demonstrate that he can represent Alabama’s “entirety of viewpoints.â€
But more important, he said, he thinks the House bill is a bad bill, which he’s said numerous times since July. He said he was surprised that others are surprised by his decision.
“I think the Senate bill is better in a lot of respects and we’ll get a better bill in conference than the one the House [passed],†said Davis, adding that the final conference bill is the one that will actually determine the fate of healthcare reform.
According to Rep. Emanuel Cleaver, who was at the CBC reception, Davis’s controversial vote is being “widely discussed†among civil rights leaders and black elected officials around the country behind closed doors.
He’s also not buying the “politics is local†argument. “I think all members of Congress are obligated to vote their districts,†Cleaver said.
Former CBC Member to Appeal Prison Sentencing
William Jefferson, the Louisiana representative who lost his seat last year after being indicted on bribery and racketeering charges, will remain free on bail while he appeals the 13-year sentence he received last Friday. He was convicted in August of federal charges of bribery, racketeering, depriving citizens of honest service, and money laundering.
Does the time fit the crime or is this an example of disproportionate sentencing? Some people have questioned whether Jefferson, 62, got a fair deal given that other disgraced former lawmakers have received lighter sentences.
In 2006, former Rep. Randy “Duke†Cunningham of California got eight years and four months after pleading guilty to accepting $2.8 million in bribes from defense contractors, the highest sentence ever given a former member of Congress.
Now Jefferson, nicknamed Dollar Bill because of $90,000 found in his freezer during a 2005 raid on his house, holds that record. The prosecution had asked for a minimum sentence of 27 years, while Jefferson’s defense attorneys had hoped for no more than 10.