I was going to dedicate my column today to the reappointment of Ben Bernanke.
It was absolutely the right thing to do to reconfirm him, and it boggles my mind that 30 senators failed to grasp this.
If time allows in the coming days I will elaborate.
I normally have my column prepared at night. In the morning I make sure the world has not blown up, and hit the publish button.
Today I woke up and saw that President Obama was having an exchange with house Republicans.
Initially I was pleased with this. I thought it reflected an open-mindedness on the president’s part.
Then I realized that this president has zero interest in what others think.
Listening to him lecture a pair of house Republicans who are doctors about health care is ridiculous.
Yes, he took questions. Yes, he gave answers.
Do not confuse this with actually listening.
He insisted that his health care bill was a centrist bill. This fits into the pattern of something being true simply because he says so.
When asked about his reversals on promises such as transparency, C-Span, and lobbyists, he simply said that he kept his promises.
He claimed to be in favor of clean coal. No he isn’t. He has made remarks in the past about punishing coal owners. He is not in favor of anything involving coal, oil, or nuclear power.
None of this is new. The only news is that he keeps insisting things that are just not so.
He wants us to work together, but keeps bashing his predecessor.
Why the hell should I work with him when he keeps disrespecting his predecessor? Why should he be treated better than the way he acts?
When he won the election, he kept quiet during the 10 week transition period. He was very polite. I returned that politeness. Only when he turned into a hyper-partisan perpetual campaigner did I return fire.
Republicans did not block his agenda. He had 60 Democrats in the Senate, a filibuster proof majority. It was his own party that failed to get the job done.
President George W. Bush had a 50-50 Senate and he got his agenda passed.
Barack Obama has tried to blame Republicans, Wall Street, and even the voters.
He had the “audacity” the other night to tell people that he did not explain his health care bill well enough.
He explained it ad nauseum. The people are not stupid. We saw the plan and did not like it. He keeps talking about change, but refuses to change himself.
This press conference this morning was not about reaching out or coming together. It was about him lecturing his opponents on why they need to come to the table, shut up, and do what he says.
The man just likes talking. He is mesmerized by his own voice.
Until he backs up his words with deeds, my criticism remains.
I will back President Obama when he is right. He was right to renominate Ben Bernanke. Had he fired Bernanke I would have lit into him. So yes, President Obama got that right.
He gets too much wrong, and needs to start actually listening and stop talking.
eric
A friend of mine used to tell me, “These are empty words”.
Friends, and all those thousands who come to this website daily,
Herr Obama, (the do-nothing President) says a lot, smiles, reads from
his scrip and has empty words.
Reading this week’s LA Times, tells us more about him and the liberal
who almost control this country, then the more biased NYTimes.
First of all, where are you Herr Obama on the right of a doctor, who
commited no crime according to State or Federal law, to live out his (her), normal life span? Why the silence about Dr. Tiller, who was murdered
in cold blood in kansas.
For those who don’t know, Dr. Tiller was an abortion doctor, and yes,
he did do late term abortions.
The guy who shot him in the face, had prepared for the murder for years, and did the dastardly deed in both their church. He is now on trial
for murder, in effect, he killed someone and took the law (in his mindset)
into his own hands.
I have been debating this with a friend who is to the right of Ghengis khan, and frankly hates liberals. Yet he perceived his murders as a “killing, similar to that in warfare”.
This is not warfare, according to kanasa law.
In kansas, it is NOT a crime to abort a fetus within a certain time frame,
unless their are mitigating circumstances..included are getting the opinion of two non-financially involved doctors.
The killing of the fetus comes into the perview of the above definition.
Originally the judge allowed manslaughter as a defense, but this has
been changed to only 1st degree murder ( sentencing life imprisonment vs the much lighter 5 years).
The liberals want the manslaughter..and protests are being heard around
the world. (Hear that Obama, where is your take on this? Talk about quiet)
Say something Obama, you are the President of these United States.
But then again, folks, he is recommending to Congress a 25b dollar
windfall to small business, student loaners, people with children and
a few other insignifant “Middle class” tax reductions.
While back in Washington D.C., the guy who is responsible for our
economic crisis (under a Democratic controlled legislature) is having
a second chance at US. I mean, give me a break.
In private industry, if you screw up and lose money for the firm, you
lose your job. ( Conan O Brian, are you there?).
Asked about his new job at the 11:30 slot daily and OBrian’s leaving
NBC, Leno said, its about money, the bottom line, and audience preferences.
Hmmmmmm, I wonder, how is GM making out? Did our tax infusion of
80b make a differenc in THEIR bottom line, or are we Americans still
prefering foreign cars? I wonder?
Herr Obama is reported to be in a long term battle with a Supreme Court
Justice, over sex bias, etc. They purposely miss one another at times.
Our President just blasted the court for it’s decision on corporate financing
of elections. He believes ( wrongly) that only individuals ( ie, individuals) should be allowed to contribute. I disagree. Why you ask, caus this is
freedom of speech through campaign contributions.
IF we are so concerned about unfairness..hows about an automatic
deduction by every employee on their income taxes..lets see, 160 workers @ 10.00 per person, thats..(you do the math). Therefore, every employee,
whether for a labor union, in a labor union, working for a corporation receiving salary/dividends/commissions/bonuses, or at the director’s level, would contribute equally.
Don’t look for the above very soon.
In Pakistan, we are hearing that the army won’t be ready to take
on the Pashtun for 1 year. In Afghanistan, Karzai estimates 10 years
before any progress fighting them, and so has reached out to the militants in his country ( Taliban ). On problem is that they have a habit of flogging
their womenfolk for crimes against Sharia law, or beheading their husbands. And God forbit you are gay…or a women sleeping out of marriage, oy vey!
Al Qaeda is now blaming we Jews (Zionists) for all the worlds ills. They say that if only the US abandons Israel, and allows for the “mother of all battles”, the “final jihad” against the state, everything will be fine and dandy, no more terrorism, no more Al Qaeda, peace and harmony between peoples and nations.
Hmmmmmmmmm, reminds me of the speeches made prior to WW. Hitler said that if Poland allows a German presence, he would leave it alone. He made a pact with Russia, after invading Poland..then attacked Russia, killing 25m people.
For those who don’t know, there were Muslim SS divisions (Waffen SS).
In all, there were 33 SS divisions, including the Totenkup (Deaths Head) in the concentration camps., etc. There was a Hitler division, Das Reich, etc.
He skillfully used the Muslim hatred for the Christian Serbs, to fight the Yugo partisans ( Tito ). Had not Rommel been defeated, he would have, along with a Greek SS division, invaded Western Palestine. The objective,
to take over the nearby oil fields, link up with the SS fighting in the Caucauses AND kill off about 600,000 Palestinian Jews (lead by Moshe
Dayan at the time).
Hitler also used the enmity in Europe to unite his legions of soldiers.
Folks, Romania, Finland and Hungary fought on the side of Hitler.
Oh btw, when the Muslims learned that they were to be sent to the Russian front, they ran away, like the cowards they are (In the Gaza Strip currently, Hamas hides behind children, knowing the Jews won’t fire on them). Unfortunately, the Jewish traitor, Goldstone, doesn’t seem to get it.
Hey guys, guess what? 54 Congressmen-USA, have signed a letter to
Herr Obama requesting he pressure Israel to lessen their security
around the Gaza Strip and Hamas.
Lessen the security? My oh my. (Not one Democrat signed). Hows about
warning Hamas to stop firing rockets into Southern Israel, adhere to
the cease fires agreed to, and end their avowed goal of destroying Israel?
Maybe then, Israel could, justifiably make things easier for the hostile
1.4m Gaza Strip Arabs, and/or Egypt could terminate it’s 59 foot high
steel fence at ITS border?
Sooooo, all in all, health, cap and trade, trade in the Americas, labor union
elections, unemployment ( @ 20%), our relations with our enemies and friends, has gone no where except no where, but worse, since
the man who promised to reach out to his opponants, AND aid the middle class, end Wall Street’s gambing, and talk, engage and use diplomacy to convince our enemies not to nuke us or our friends, is dead on arrival.
Scott Brown….you are NOW the real messiah. Please lead US out of
this mess. Undo the election 1 year ago, please. (Yes I know he posed in the nude when he was in college-but at least he had gonads.) Get it!
I’m pretty sure he just talks to hear his own voice. But really, he acts so disappointed in the GOP during their little “talk”. It kinda felt like he was admonishing a group of unruly school children. Is he really so full of himself that he can’t see past his own teleprompters? His motto, “Okay, let’s talk, but only I get to say anything.”
I know our good host is very partisan, so I’m not surprised by his response to what we both apparently watched today. The GOP house members pretty much just trotted out their party lines, and Obama reacted pretty much as we’d expect. After all, Obama is not a Republican (a little fact that seems to be eluding many of his detractors in the GOP).
Take “clean coal.” Yes, Obama “Supports” clean coal. So do I. I also support telling little children there is a Santa Claus and a Tooth Fairy. But that doesn’t mean there actually is a Santa and a Tooth Fairy. Well ,the same goes for Clean Coal. THERE’S NO SUCH THING AS CLEAN COAL. Sure, Obama and most Dems support investment in developing Clean Coal technology, and he’s made good on that…
THE RECOVERY ACTED INCLUDED 3.4 BILLION IN CARBON CAPTURE AND SEQUESTRATION PROJECTS.
So, either the Republicans are LIARS, or they just never got around to reading the bill they didn’t vote for.
Obama has every right to blame Wall Street, the Republicans, and for that matter the banks, the Democrats in the House and Se4nate, teh SCOTUS, and everyone else who cannibalized this once great nation over the past thirty years. Face reality – THEY WRECKED THE COUNTRY.
JMJ
Jersey, you’re reality is what you make it. Much like I explained yesterday how it doesnt matter how much knowledge you have, its what you do with that knowledge that makes for a functional reality based on existential facts.
You jerks created this housing bubble, you jerks dished out more entitlements than we couls afford, you jerks let our enemies get away with murder for decades until it came to a head that we had to deal with. You jerks took a floundering economy and turned it into the most disasterous outlook for our future the coutry has ever seen with ni fix in sight. You jerks went and elected some smooth talking not knowing his a$$ from a hole in the ground jerk for the simplistic idealistic reason that having our first black president would be ooh so cool and show the entire world just how tolerant and progressive weve become.
You guys are running the show, no one else, you’ve had enough time to get it together and you’re failing miserably to the point your own cant jump ship fast enough because the blame Bush crap just isnt flying anymore.
Spending freeze ?
Good God, you people are as stupid as I’ve always asserted if you really believe that anyone is asstupid as you keep trying to say they are.
PLEASE, PLEASE, PLEASE, PLEASE keep saying Americans are stupid so we can end this BS that much quicker and get your lying stinking rumps outta the way that much faster.
I’m not a big fan of half the crap the right has pulled either but at least were not running around claiming were so much brighter because our views are different
Right now is about the last chance you guys have got at producing some of this bi partisanship you keep crying aboutsayi ng thee country needs and stop all the two faced bold lies that a freeking 12 year old can see thru
Micky, I understand that you don;t know any better about what caused the real estate bubble, but the “experts” giving you the reasons? They are LIARS. It’s not a coincidence WHEN the real estate bubble burst, and it DIDN’T happen after the Dems were in the majoity and the White House. De- and un-regulated markets caused the collapse. WALL STREET CAUSED THE MORTGAGE MELTDOWN. Anyone who says otherwise is either ignorant of the facts, or a liar.
Entitlements are not the problem. A sleazy GOP that didn’t pay the bills nor raise the revenues nor change the programs caused the problem with entitlements.
The GDP grew 5.7% last quarter, Micky.
Grow up. The GOP failed.
JMJ
keep it up jersey. yup, no one understands anything better than jersey.
geez, whos washing your feet for you tonight ?
I know damn well what caused it and how it took decades for the banks to finally not be able to carry all that bad paper anymore
this admin has failed its country in record time and all you guys can do is cry likr babies and blame everyone but yourself.
so, the gdp moved, whopee. were still at 10% unemployment after being told a trillio bucks would hold it off at 8.
you guys are a joke.
liars huh ? I guess the stupid thing aint workin so well ?
Hows this for stupid.
I showed you a couple months back all thee transcripts and documents showing what led up to the buble but you, the genious, thinks your opinion trumps facts.
This gets funnier by the day, keep it up, I’m logging it all. I’m gonna make some serious money off you because you’re so predictable.
You already paid half my mortgage this month
Micky, Obama handed those GOP House members their behinds today. They lied, and lied, and lied, and lied, and he called them out on it. Your ideology – conservative ideology – failed. It is a failure. It doesn’t work. It is nothing but politics for fools and crooks. And it failed right in front of your face but you just refuse to face it. You turn your head and pretend it didn’t happen, and when the wreckage is unavoidably obvious, you blame it on people who had no power whatsoever to cause it. The gall is unending.
JMJ
Jersey, thats the dumbest thing I,ve heard since his SOTU speech.
He was cofronted on what we shpould tell our constituents over this matter that he keeps aying the GOP pffererd no solutins to healthcare. He knew that was a lie and couldnt answer it. He was asked about c span and transparencyh and ran inyoanother wakll because his prompter was not programmed for any such thinkg.What kond of make believe wishful thinking world do you live in that says anyone got their asses handed oi then except for him ?
What lies ? HUH ? You think for once you could be honest and actually tell us what the hell these lies were ? (on the part of the right)
“He accused Republicans of portraying his now-stalled healthcare reform effort as a “Bolshevik plot” and telling their constituents he is “doing all kinds of crazy stuff that’s going to destroy America.”
The only problem here Jersey is that its noy us that are stalling his stuoid heathcare bill, its your own party, the one in power that thrown up so many road blocks the damn thing doesnt even resemble what it started out as. So spare me this regurtitated crap of yours that anyone lied about anything.
All we did was our job, which was to point out what a collosal waste of money it would be that we dont have right now and that if anyone is going to have healthcare someone somwhere is going to have to have a job to support thr revenues for sucgh a massive undertaking. But likre everything else this guy has been doing hes got it backasswards.
JOBS FIRST MORON!!! GET PAST 10% UNEMPLOYMENT AND THEN YOU CAN TALK ABOUT HEALTHCARE FOR 33 MILLION PEOPLE AND SOUND LIKE YOU HAVE A FREAKING CLUE !!!
The guy and your party are screwing up so bad that seats belonging to dems for decades are going to cons that no ones even heard of before and you think were getting our asses handed to us ?
Yup, I was right, this keeps getting funnier by the minute, lik e this really stupid line right here;
“you blame it on people who had no power whatsoever to cause it. The gall is unending.”
Yeah, your congress had no power for the last 2 years of Bushs term, or to create the CRA, or the regulations forcing banks to loan money to minorities who couldnt afford to pay it back. It was the all powerful Cons who did that
Eric,
I’m a bit surprised that you supported Bernanke’s re-nomination. After all, the bailout of AIG, TARP and the huge purchases of MBS (which have escaped scrutiny so far) has created a huge amount of moral risk and might very well end up costing the American taxpayer a huge amount of money yet. It could also be argued that Bernanke and Paulson’s fear mongering regarding the possibility of another Great Depression exacerbated problems in the financial markets (and are the reason why the stock market recovered strongly last year). Even if their actions were justified one still has to argue why the financial system was initially allowed to get into such a mess.
Regarding Obama’s decision to address the House Republicans, it was a stroke of political genius. At the very least, it was a distraction from the re-nomination of Ben Bernanke. It was also a win-win situation. Either the Republicans pulled their punches, in which case Obama could be praised for his courage, or they risked being attacked as too partisan. There was also a possibility of a Joe Wilson moment. Obama is a poor leader and has been unlucky but he is a savvy strategist, as he showed during the election, and should not be counted out just yet.
Finally, I’m not Jewish but I would guess that AIPAC has to avoid antagonising one side of the aisle, or appearing too partisan. In any case, it makes more sense to praise Henry Waxman and Brad Sherman, who could be swayed by such a gesture, than John Kyl and Joe Lieberman who already know what the right thing to do (although Lieberman has far more leverage than Waxman because of his role in the Senate). I also read somewhere that, as a matter of policy, they support incumbent who agree with their goals, even if the challenger is even more pro-Israel. For instance, they supported Weicker over Lieberman in CT-SEN 1988
However, I do agree that the time for sanctions has passed and that the negotiations with Russia and China are simply providing Obama with an excuse for dragging out the process further. Even if are implemented, they could make things worse by delaying an Israeli airstrike.
Here, one more time for the record
Do your research! No one looks this crap up and everyone talks out of their rump. You do realize that when you speak about a topic you don’t know about asserting that your opinion is rhe final word you risk looking dumb.
Clinton passed three legistlative acts so tHat people who could not afford a mortgage could get a mortgage, even if they couldn’t pay it back.
Then he and his administration pressured Fannie Freddie into buying all these newly-termed sub-prime loans.
For anyone who doesnt want to take my word for it (I,m not Jersey) the NYTs of all publications runs it down pretty well …
Fannie Mae Eases Credit To Aid Mortgage Lending
By STEVEN A. HOLMES
Published: September 30, 1999
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WASHINGTON, Sept. 29— In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.
The action, which will begin as a pilot program involving 24 banks in 15 markets — including the New York metropolitan region — will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.
Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.
In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates — anywhere from three to four percentage points higher than conventional loans.
”Fannie Mae has expanded home ownership for millions of families in the 1990’s by reducing down payment requirements,” said Franklin D. Raines, Fannie Mae’s chairman and chief executive officer. ”Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.”
Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to black borrowers, compared to 5 per cent of loans in the conventional loan market.
In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.
”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”
Under Fannie Mae’s pilot program, consumers who qualify can secure a mortgage with an interest rate one percentage point above that of a conventional, 30-year fixed rate mortgage of less than $240,000 — a rate that currently averages about 7.76 per cent. If the borrower makes his or her monthly payments on time for two years, the one percentage point premium is dropped.
Fannie Mae, the nation’s biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.
Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites.
Home ownership has, in fact, exploded among minorities during the economic boom of the 1990’s. The number of mortgages extended to Hispanic applicants jumped by 87.2 per cent from 1993 to 1998, according to Harvard University’s Joint Center for Housing Studies. During that same period the number of African Americans who got mortgages to buy a home increased by 71.9 per cent and the number of Asian Americans by 46.3 per cent.
In contrast, the number of non-Hispanic whites who received loans for homes increased by 31.2 per cent.
Despite these gains, home ownership rates for minorities continue to lag behind non-Hispanic whites, in part because blacks and Hispanics in particular tend to have on average worse credit ratings.
In July, the Department of Housing and Urban Development proposed that by the year 2001, 50 percent of Fannie Mae’s and Freddie Mac’s portfolio be made up of loans to low and moderate-income borrowers. Last year, 44 percent of the loans Fannie Mae purchased were from these groups.
The change in policy also comes at the same time that HUD is investigating allegations of racial discrimination in the automated underwriting systems used by Fannie Mae and Freddie Mac to determine the credit-worthiness of credit applicants. ”
I can do this all day long Jersey, eveb linking the CRA as far back as Carter
Sure, the Fed, which lowered interest rates after 9/11 only sped up the process of issuing loans to sub-prime borrowers (The minority vote), but the damage from the Clinton administration was already done, and this would have happened regardless of the Fed or Bush !!!!
Fannie Mae didn’t create credit default swaps, exotic loans, and all the rest of sleazy criminality that went on on Wall Street and among the banks. Fanny Mae didn’t cover-up irresponsible speculation in the over-developement in southern California, Nevada, Arizona and central Florida. Fannie Mae didn’t unleash piles of cheap capital into high-risk markets. It isn’t “poor minorities” that caused this disaster. It isn’t “poor minorities” who bought over-priced homes in the markets that were at the epicenter of the failure. Yes, I know that conservative always want to blame the little guy – “poor minorities” all the better! – but it wasn’t them that caused this. It wasn’t Clinton or Carter or the CRA, lest all this wouild have collapsed years ago. It certainly wasn’t out of the goodness of Clinton or Bush’s, or the GOP congress’s, hearts to loosen up the FM loan backing criteria. They did it to open up markets for high-risk, knowingly moral-hazardous, for some “liberal” agenda. Only an idiot would believe that. There’s NO coincidfence that we had wide-spread systemic failures accross MANY sectors IMMEDIATELY after 6 years of all-GOP rule. Anyone who thinks otherwise is a fool.
JMJ
” lest all this wouild have collapsed years ago. ”
You tried that BS answer once before and it didnt fly but of course like every other moonbat you gigure if you say it often enough it’ll become truth.
The efects of the cra took decades to accumilate the bubble.Not all the blame goes to Carter or Clinton but they certainly get bo credit for going to thee hill like McCain and Bush did warning Frank and Dodd of the impending explosion.
Unlike your bulldoodoo this documented fact thats been shown to you before in actual congressional transcripts.
You sleazy loons wanted the minority vote so you went and threatened the banks to make mortgages acesible for those that couldnt afford it.
You got the votes, the country is now paying off your bribes.
The numbers and datesare all right there bub.
Now, unless you got something besides name calling and baseless accusations put a lid on iy before you tarnish that intellectusal sheen you’re supposed to have.
Youguys have been running the show for a year now, its your show, it sucks, big time. Your own party cant jump ship fast enough.
None of the math jives, its all BS.
“FOOLS”, “IDIOTS”…. keep it up.
ITS that kind of crap thats got the people pi$$ed at you but you’re too damn stupid to realize that by calling good decent people who know crap when they see it “fools” and Idiots”.
Can you say “Mass a chews it ” ?
This new keyboards gonna take some getting used to, or maybe I’m just stupid.
Its everywhere, even the Heritage Foundation gives the facts that back my claim.
No ones blaming the “little guy” Jersey. Thats the typica predictable liberal MO, or blame the capitalist or anyone who makes a buck.
The blame goes to sleazy little democrat politicians who use race and class warfare to win elections at every chance…. even if it means ruining the country
To avoid an “F” from the CRA, which could jeopardize their viability, the banks were pressured to direct hundreds of billions of dollars in high-risk mortgages to inner-city and low-income neighborhoods. Moreover, under CRA pressure, banks would “hire” radical, non-profit groups like ACORN to find them customers. Once trillions of dollars began to flow, politicians and lobbyists tapped into this stream, and so did left-wing activist groups. According to George Mason University’s Russell Roberts, the CRA was buttressed by other new regulations during the Clinton Administration. As Roberts writes, “For 1996, the Department of Housing and Urban Development (HUD) gave Fannie and Freddie an explicit target — 42 percent of their mortgage financing had to go to borrowers with income below the median in their area. The target increased to 50 percent in 2000 and 52 percent in 2005. For 1996, HUD required that 12 percent of all mortgage purchases by Fannie and Freddie be “special affordable” loans, typically to borrowers with income less than 60 percent of their area’s median income. That number was increased to 20 percent in 2000 and 22 percent in 2005. The 2008 goal was to be 28 percent.” The banks were kept from rebelling by using Fannie Mae and Freddie Mac’s deep pockets to buy these poor-quality loans and take them off the banks’ books. Under-regulation of the GSEs — Fannie Mae and Freddie Mac — allowed the money stream to widen and keep flowing. There has always been an implicit understanding that taxpayers would cover GSE losses and this enabled them to attract money and pour it into the CRA-induced sub-prime market.
The Bush Administration had warned about this for years. Fannie and Freddie, however, could skim enough to pay for political protection, plus pay sky-high executive salaries and bonuses to well-connected political figures. Over the past decade, Fannie and Freddie combined to spend a reported $200 million on lobbying and campaign contributions. Now bailing them out may cost taxpayers $200 billion directly, and far more indirectly. The circle of political back-scratching centered around the theme of affordable housing, which the GSEs marketed heavily. Politicians wanted housing for low-income and poor credit risks, so they used Fannie and Freddie to further that objective, and the GSEs responded with campaign help for those politicians. In return, politicians resisted reforms. This was demonstrated at a 2004 House hearing, where Rep. Maxine Waters (D.-Calif.) denounced attempts to stiffen oversight and regulation of this duo “so as not to impede their affordable housing mission, a mission that has seen innovation flourish, from desktop underwriting to 100 percent loans.” “Desktop underwriting” meant undocumented loans. No proof of income or credit history required. And zero down payment. Members of both parties were involved in protecting the system. But liberal Democrats were the dominant force. Recently, House Financial Services Chairman Barney Frank (D-Mass.) told The Boston Globe, “[Republicans’] failure to regulate sensibly … endangered the economy and … burdened it with bad stuff…. Their own philosophy blew up in their face. They were so extreme in their insistence that there be no government intervention that they have wound up provoking far more government intervention than the Democrats ever would have.” But Frank is covering up his own role because he sang a far different tune in 2003, when the Bush Administration and many Republicans (including Sen. John McCain) tried to require Fannie and Freddie to comply with Securities and Exchange Commission regulations and other additional oversight requirements. Treasury Secretary John Snow, in fact, had specifically warned Congress that Fannie and Freddie needed a new supervisory structure so that both institutions would “maintain capital and reserves sufficient to support the risks that arise or exist in its business.” Rep. Frank was unconcerned. He told a hearing, “Fannie Mae and Freddie Mac are not in a crisis.” Rather, he said, they were “fundamentally sound,” and criticisms of them were unjustified exaggerations and “disaster scenarios.” Then he confirmed why: “The more pressure there is [to regulate] then the less I think we see in terms of affordable housing” He wanted to continue both the giveaway train supplying mortgages to those who couldn’t afford them and the gravy train for politicians. This appealed to liberals and in particular to the Congressional Black Caucus, which received six-figure support from both Fannie and Freddie in 2007. The GSEs’ major campaign largesse went to well-placed friends in key positions. The top six from 1998 thru 2008, according to the Center for Responsive Politics: Sen. Chris Dodd (D.-Conn.) $165,400 Sen. Barack Obama (D.-Ill.) $126,349 Sen. John Kerry (D.-Mass.) $111,000 Sen. Robert Bennett (R.-Utah) $107,999 Rep. Spencer Bachus (R.-Ala.) $103,300 Rep. Roy Blunt (R.-Mo.) $ 96,950 And almost everyone in Congress got something.
The GSEs lobbied hard, too. Their combined lobbying budget averaged $17 million a year. As described by Rep. Chris Shays (R.-Conn.), “They hire every lobbyist they can possibly hire. They hire some people to lobby and they hire other people not to lobby so the opposition cannot hire them.” But friends at the top were not enough. They needed them in every community, too. The Community Reinvestment Act guaranteed a steady stream of low-quality, but highly political, loans. Congress passed the CRA in 1977 to combat “redlining,” a lending practice that prevented loans to minority communities. Clinton Administration regulations in the ’90s added teeth to CRA, requiring banks to show compliance with meeting low-income loan targets or face civil actions that could assess a $500,000 penalty for each violation. Banks were “encouraged” to comply by hiring community groups (including ACORN) who contracted with financiers to steer low-income applicants to their institutions. As the Manhattan Institute’s Howard Husock wrote in 2000: “The Senate Banking Committee has estimated that, as a result of CRA, $9.5 billion so far has gone to pay for services and salaries of the nonprofit groups involved.” The left created the system that paid its community organizers very handsomely, thanks to the regulations on the financial community.
As The Heritage Foundation’s J.D. Foster recently noted, “While a worthy cause, the net effect [of CRA] is often to encourage loans at lower credit standards and to encourage people to buy houses they really cannot afford.” The net effect has also brought the economy to the brink of disaster. But unless the American public is told, re-told, and educated about how we got here, there won’t be reform of the bailed-out-but-still-alive GSEs nor of the CRA. Then we would witness more big government, giving us far more help than we can afford.
Ernest Istook is recovering from serving 14 years in Congress and is now a distinguished fellow at The Heritage Foundation.
Amazing, Herr Obama will propose legislation that will reduce the deficit by a few billion/year and expand opportunities and tax credits for the middle class and small business.
I guess he never heard of the SBA (Small Business Administration), which loans out billions year and most especially to minority groups.
I wonder if he is aware that there are billions owed by the professional
students, who prefer to borrow at low interest rates ( hopefully to never pay the loan back after graduation), than take year off and work, or
do, what many of us did, work part time through college.
Better still, why not reduce graduation time to 2.5 to 3 years, and cut all
the froth ( like letters and science courses which have no importance
whatsoever ) required for a BA, or BS (bs is more aptly put).
I mean why in heavens name does anyone need 60 units of L and S, for
a business degree, which, typically has 4 core courses worth their salt
in business?
Let’s admit that college / university degrees for women are mostly designed to attract more women students who see the MRS. degree after the BA or BS, or even PHD.
Frankly, one of the few courses I took in 16 years which still make
sense was typing ( I was fast, typing 40 wpm ). The geometry, calculis,
biology, chemistry, college English, gym, were worthless, not to mention
physics, trig, and that English author (what’s his name I forgot?).
Obama has accomplished a few good things however. He loaned GM over 50 billion (yet to be paid back). He embolden Mr. Chavez to consider
running the Israeli blockade of the Strip meant to keep Fajr rockets/Kassams out of Hamas hands; he is putting a cap on required
repayment student loans, he has financed sub-prime lenders who never should have borrowed in the first place..
….and now he is authorizing Patriot Missile be placed in 4 Arab (Gulf) countries to protect Israel from Iranian missiles ( soon to be nuclear tipped).
A few facts: Israel has 400 high fusion nukes..mounted on 3 platforms as follows: Jerichos, F-15Is, and Dolphine Class submarine cruise missiles.
If needed, it can also utilize its 400 Phantom 2,000 fighter bombers.
As such, a nuclear attack by Iran for example, will result in virtually no living creature alive in that country within 3 weeks of a total Israeli retaliation. ( See US general report to Congress).
However, one successful rocket hitting Tel Aviv, and it’s all over but
the Shoah memorials and Spielberg’s next movie.
Sooooo, what should Obama do? Well for starters, why wait for Iran
to launch it’s missile? I am recommending a pre-emptive strike, using
US Tomcats (F22s), hundreds of smart missiles, and high flying B1s
joined by 300 Israeli F15Is and F16s.
These could be used to take out Ahmad..his surrounding mullahs, and the Revolutionary Guards. That would free up 60m Iranians yearing for democracy and peace, allow for development of the oil infrastructure
by Western countries, and take the threat of a nuke attack away.
Instead of a few dozen Patriot Missiles..simply use those B1s and B2s guy.
This might also persuade Chavez to forgo his plan on running the blockade, getting arrested, and creating an international incident. It might also send Hamas/Hez a message.
Are you listening Obama?
BTW, has anyone read anything coming from him about the conviction
of Dr. Tillman’s murderer. Oh I forgot, a fetus is a pre-born adult life..and should be treated as if born. Oy vey! Funny, but a fetus never sued anyone at anytime.
The liberals are for abortions, but against murdering the doctor who performs them. Is the world upside down, or what? Can anyone explain?
“Amazing, Herr Obama will propose legislation that will reduce the deficit by a few billion/year and expand opportunities and tax credits for the middle class and small business.
I guess he never heard of the SBA (Small Business Administration), which loans out billions year and most especially to minority groups. ”
The whole point behind establishing redundant offices is to bring legislation allows for more special interests and pork to be slipped in.
Oh, and dont forget ‘ jobs will be created”
I think we should just spike the entire Iranian water supply with pork juices,.
After that no ones going anywhere to meet any Imams or virgins