Politics

House subcommittee chairman: Delphi subpoenas possible, scandal looks like cover-up

Matthew Boyle Investigative Reporter
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Tennessee Republican Rep. Phil Roe told The Daily Caller that President Barack Obama’s administration appears to be engaged in a cover-up of the scandal related to Delphi salaried retirees who lost their pensions during the 2009 auto bailout.

“The idea that after I’ve reviewed this, you’re right,” Roe said of “cover-up” allegations, in a phone interview late last week. “This is the M.O. for this administration. Look at [Operation] Fast and Furious: If you look at any of these documents that we’re trying to get, just to try and — maybe nothing was wrong, and I don’t know because we don’t have the documents yet to find out. We know how the procedure is supposed to work and this is a little bothersome.”

Roe, who chairs of the House Education and Workforce Subcommittee on Health, Employment, Labor and Pensions, leads one of three congressional investigations into how the actions of Treasury Secretary Timothy Geithner and the White House affected 20,000 nonunion Delphi retirees.

While those nonunion retirees lost significant portions of their pensions, health care and life insurance benefits from this deal, their unionized peers saw their benefits fulfilled.

For years since, the Obama administration has claimed the quasi-independent Pension Benefit Guaranty Corporation (PBGC) made the decision, and said its own officials were not involved. Email evidence TheDC obtained and published in early August, however, shows that’s not the case.

One group of emails demonstrated that political officials from the White House and the Treasury Department drove the cutoff of the nonunion retirees’ pension plans. Another tranche of emails showed that the former firms of two different members of the Obama Auto Task Force benefited from that deal.

GOP members on Roe’s committee had asked the Treasury Department to produce documents in Dec. 2009, and although by April 2010 Geithner’s team had agreed to produce those documents, they followed through only this week — after receiving a letter from Roe and full committee chairman Rep. John Kline.

Roe, who wasn’t on the subcommittee leading this probe back in 2009 but is now its chairman, said it was TheDC’s investigative work that brought his attention back to the issue.

“If there weren’t journalists out there … pointing this out, no one would ever know what goes on,” he said. “I mean, no one would ever know.”

Roe said that while union workers and retirees saw their pensions and benefits made whole and the non-union workers and retirees lost theirs, he doesn’t blame the guys who got their benefits. “I don’t blame the employees, union or not. I don’t want anyone out there reading this to think that,” Roe said. “I don’t fault anyone fussing to try to get what they were promised. That doesn’t bother me as much as maybe the fact of how it was done.”

“There’s a process for the PBGC when you have a bankruptcy,” Roe continued. “And the way I understand this worked was that Delphi had a contract with GM that their hourly workers were to be topped up should there be a bankruptcy or they go out of business — they’d make them whole. The salaried folks did not [have such a contract].”

While some documents did reach Roe and Kline’s committee by the Sept. 26 deadline, it’s unclear if those disclosures reflect the complete picture of what happened. Roe told TheDC subpoenas are on the table if the Obama administration doesn’t comply with congressional oversight requests.

“I asked one of my staffers, ‘What recourse do we have if these documents don’t show up?'” Roe said. “They said anything up to a subpoena with them. We do have subpoena power so we’ll get the documents. We may have to wring them out of them, but we’ll get them.”

“I think everything is on the table,” Roe added. “We have to have some kind of carrot and stick — and I asked my staff, ‘What kind of carrot do we have and what kind of stick do we have?’ The carrot is we’ve asked in a nice way for what’s soon to be three years. I think the next thing you use is the stick. My staff thinks that they’re going to be forthcoming: Ways and Means, as I understand it, has already got some of these documents.”

Roe said it’s unlikely that his subcommittee will see any movement on the Delphi case until the next Congress. The House is in recess until after the Nov. 6 election, and the lame-duck session shortly thereafter is filled with make-or-break legislation that’s required to keep the government functioning.

“We’ve got sequestration, the Bush tax cuts, the AMT [Alternative Minimum Tax], the [Medicare] SGR [Sustainable Growth Rate formula], a payroll tax cut extension and the farm bill,” he said. “All that’s going to come up in the lame duck so I think all those five or six things are going to suck all the air out of the room.”

“My bet is this is going to be in the next Congress, and let me tell you why I say that — and again, I don’t make out the schedule. The reason I think there will be hearing in the next Congress, is, first of all, we need the documents. And, it’s going to take a while to round up witnesses [for hearings].”

The auto bailout as a whole, Roe said, “was a success for some, and a disaster for others.”

“It depends on your vantage point. What set of lenses are you looking at it through?” he said. “For the bondholders, the people that I knew that lost everything they had, it was terrible.”

“For people who kept their job, it’s worked out pretty well.” he added.

“And, hey, for full disclosure, I own a Chevy Equinox — I bought a Chevy and I also bought a Ford. I bought one from a company that wasn’t bailed out and one that was. And the little vehicle I got is a great vehicle. They’re making good products and I hope GM is wildly successful, but the economy is going to have to get better.”

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