Just a few hours before President Barack Obama signed the $787 billion economic stimulus plan into law, U.S. Sen. Bob Corker, R-Tenn., heaped criticism on the package.
“I think it’s a huge mistake to have done what we did,” the former Chattanooga mayor told the Kiwanis Club of Chattanooga at a Tuesday luncheon.
Sen. Corker, speaking in the Sheraton Read House, said Tennessee will get $4.2 billion out of the stimulus, “more money than it can possibly spend.”
* On energy: Sen. Corker said he hopes the price of gas dropping below $2 does not mean “we will lose sight of how important energy is.” He said he’s proud of Tennessee’s contributions to alternative energy technology.
* On foreign policy: He said he has “tremendous hope” for the Obama administration’s foreign policy. “You just would not believe the effect that this election has had on the rest of the world,” he said.
* On unions: He said so-called “card check” legislation — which he said would eliminate secret balloting for unions — is “a disaster.” He said it would “exacerbate tensions between management and labor.”
He said Gov. Phil Bredesen, a Democrat, has managed the state well. Though the governor faces about a $900 billion budget shortfall, he could manage through it without the stimulus, Sen. Corker said.
“Our state is really subsidizing states across the country that have not been managed well,” the senator said.
Lydia Lenker, spokeswoman for Gov. Bredesen, said the stimulus money will help address current economic issues, but she said it’s “no silver bullet.”
“Difficult cuts will still need to be made,” she said. “This is one-time money that will disappear in two years and, at that time, we’ll have to fund these projects with state dollars.”
Sen. Corker criticized the stimulus for spending he said was “inside government,” that is, it goes from the federal government to the states. Mr. Obama has said, however, that 90 percent of the 3.5 million jobs expected to be created or saved by the stimulus would be in private businesses.
Still, Sen. Corker, who serves on the Senate Banking Committee, said federal lawmakers instead should have looked at restoring confidence to the nation’s ailing credit market.
“You would not believe the upstanding people all across this community and across this state that are teetering,” he said.
Financial institutions are looking at no less than $1 trillion in additional losses in the near future due to still-outstanding loans, Sen. Corker predicted. He said quick action is necessary to free up the credit market.
One option he suggested was that the nation’s four largest banks — JPMorgan Chase, Bank of America, Citibank and Wells Fargo — may have to split their holdings into “good banks” and “bad banks” to get people investing in the good holdings.
“There will possibly and probably be some level of apportionment for all of us to play in dealing with that bad bank,” he said.