Of all the points raised by different analysts about the economy last week, surely the best was Representative Barney Frank’s reminder on “Charlie Rose” that Ronald Reagan’s favorite laugh line was telling audiences that: “The nine most terrifying words in the English language are: ”˜I’m from the government, and I’m here to help.’ ”
Hah, hah, hah.
Are you still laughing? If it weren’t for the government bailing out Fannie Mae, Freddie Mac and A.I.G., and rescuing people from Hurricane Ike and pumping tons of liquidity into the banking system, our economy would be a shambles. How would you like to hear the line today: “I’m from the government, and I can’t do a darn thing for you.”
In this age of globalization, government matters more than ever….
Those are the kind of words that would get my attention. The last president who challenged his base was Bill Clinton, when he reformed welfare and created a budget surplus with a fair and equitable tax program. George W. Bush never once ”” not one time ”” challenged Americans to do anything hard, let alone great. The next president is not going to have that luxury. He will have to ask everyone to do something hard ”” and I want to know now who is up to that task.
It would be a mite better article if it discussed the 35 years of government “helping” us which brought about this situation. Should you know someone in the banking and mortgage industry, ask them about the “help” in deciding who was worthy of a loan. Then, be afraid. Be very afraid of more government “help.”
Friedman is arguing that the government was not there before the intervention…. a cute argument, but patently false. Another cutey concept Friedman puts out is describing Washington as the “booster rocket” of the economy. I would note to Friedman that the whooshing sound Washington makes is that of flushing taxes down the drain.
Bill Clinton reformed welfare and tightened created a budget surplus like I captured Saddam Hussein. Actually, even that analogy isn’t apt given that I was all in favor of capturing Saddam Hussein and Bill Clinton fought those two accomplishments hammer and tong.
If government hadn’t created and urged on Fannie and Freddie to new heights of irresponsibility, we wouldn’t be bailing them out.
Jeffersonian,
You said elsewhere:
[i]”The current unpleasantness is entirely the result of the meltdown in the mortgage sector, which is itself a result of the ballooning of the same. That is itself the direct result of the swelling of Fannie and Freddie, itself a joined-at-the-hip organization with the DNC, as we’ve discussed. Bush and McCain have both tried to rein in these behemoths and been smeared for doing so.[/i]
And yet McCain says of Wall Street, “Mismanagement and greed became the operating standard†and does not single out Fannie and Freddie as the sole or even primary culprit. As I asked before, What part of the Republican candidate for President’s statement do you disagree with and why?
See:
http://www.youtube.com/watch?v=bIxADYfdpD0
Moreover, as for who is “joined at the hip”, what do you make of this?:
[b]McCain’s Fannie and Freddie Connections [/b]
John McCain railed against Fannie Mae and Freddie Mac on the campaign trail today, saying that the CEOs that led the lenders to ruin “deserve nothing†and should have to pay back their severance packages. In an Wall Street Journal op-ed co-bylined by his vice presidential pick, Sarah Palin, McCain suggested bold reforms for Fannie and Freddie that would “terminate future lobbying, which was one of the primary contributors to this great debacle.â€
If that’s the case, McCain should look first to his campaign staffers as the cause of that debacle. One of them was Fannie Mae’s head of lobbying, and spread tens of millions of dollars around Washington in the form of lobbying contracts. A number of McCain staffers were on the receiving end of those contracts, collecting hundreds of thousands of dollars each from the lenders to rep their interests. And McCain’s campaign manager served as president of a lobbying association that fought to protect Freddie Mac and Fannie Mae from the sort of regulation that McCain is now proposing.
In McCain’s op-ed in the Journal, he and Palin wrote:
For years, Congress failed to act and it is deeply troubling that what we are seeing is an exercise in crisis management rather than sound planning, and at great cost to taxpayers.
We promise the American people that our administration will be different. We have long records of standing up to special interests…
But McCain’s own campaign staffers are those special interests, a fact that casts doubt on both McCain’s hiring judgment and his ability to pursue tough reforms of Fannie and Freddie.
Aquiles Suarez, listed as an economic adviser to the McCain campaign in a July 2007 McCain press release, was formerly the director of government and industry relations for Fannie Mae. The Senate Lobbying Database says Suarez oversaw the lending giant’s $47,510,000 lobbying campaign from 2003 to 2006.
And other current McCain campaign staffers were the lobbyists receiving shares of that money. According to the Senate Lobbying Database, the lobbying firm of Charlie Black, one of McCain’s top aides, made at least $820,000 working for Freddie Mac from 1999 to 2004. The McCain campaign’s vice-chair Wayne Berman and its congressional liaison John Green made $1.14 million working on behalf of Fannie Mae for lobbying firm Ogilvy Government Relations. Green made an additional $180,000 from Freddie Mac. Arther B. Culvahouse Jr., the VP vetter who helped John McCain select Sarah Palin, earned $80,000 from Fannie Mae in 2003 and 2004, while working for lobbying and law firm O’Melveny & Myers LLP. In addition, Politico reports that at least 20 McCain fundraisers have lobbied for Fannie Mae and Freddie Mac, pocketing at least $12.3 million over the last nine years.
For years McCain campaign manager Rick Davis was head of the Homeownership Alliance, a lobbying association that included Fannie Mae, Freddie Mac, real estate agents, homebuilders, and non-profits. According to Politico, the organization opposed congressional attempts at regulation of Fannie and Freddie, along the lines of what John McCain is currently proposing. In his capacity of president of the group, Davis went on record in 2003 and insisted that no further reform of the lenders was necessary, in contradiction to his current boss’s sentiments. “[Fannie and Freddie] are subject to an innovative and stringent risk-based capital stress test,†Davis wrote. “The toughest in the financial services industry.â€
At a campaign rally Wednesday morning in Fairfax, Virginia, John McCain said that the heads of Fannie Mae and Freddie Mac ought to give back the millions of dollars they’ve earned. What about the lobbyists who helped Fannie and Freddie game the system? Maybe McCain can ask them — at the next campaign strategy meeting.[/b]
Stop blowing smoke at us, Albany.
Reformers have been trying to shape up Fannie and Freddie for years. This has primarily been attempted by the current White House, but even Larry Summers was for it. But the Congressional Dems would have nothing to do with it, even as evidence mounted of mismanagement. What problem?, Barney Frank said two years ago.
Also, check out Fannie/Freddie’s campaign contributions: Dodd, Kerry, and Obama are the top three. McCain is on the list too, in the 30’s I believe.
It’s not smoke, it’s clarity. The smoke is all coming from the other direction. Not one of the economic conservative posters on T19 will yet own up to the full complicity and misbehavior of the “free market” in all of this mess from beginning to end, ithe “free market’s” desperate need for regulation — as Bloomberg said today — and the Republican’s hand in this mess from beginning to end quite including Fannie and Freddie — if only milkers of the system. How about some candor on your end? Finally.
St. Bloomberg of the hallowed Tammany Hall, a vision of financial perspecacity!
OK, I’ll fess up abjectly, the GOP is originally responsible for Freddie and Fannie, and for failing to run competent candidates to replace Sen Dodd and Rep Frank, who were the snakes in the garden serviing to beguile the GOP “original sinners”.
Tom, sarcasm is just another dodge. What do you make of McCain’s statement about Wall Street that “Mismanagement and greed became the operating standardâ€? Just lambs led to the slaughter? What do you think about those Freddie and Fannie lobbyists on his campaign staff, quite including its head? Ready to lead….
Look, I don’t want to distort this crisis as coming from one political direction only. But we’ll learn nothing from it if you deregulation free-market types don’t get honest about your side.
[i]”The original sin of this crisis was easy money. For too long this decade, especially from 2003 to 2005, the Fed held interest rates below the level of expected inflation, thus creating a vast subsidy for debt that both households and financial firms exploited.”[/i]
–Wall Street Journal
Who was the President? Who controlled Congress in this period?
The original sin of this crisis was easy money. For too long this decade, especially from 2003 to 2005, the Fed held interest rates below the level of expected inflation, thus creating a vast subsidy for debt that both households and financial firms exploited.
[i]”For most part between 1995 and 2007, the Republicans controlled both houses.” [/i]Wikapedia
For most part between 1995 and 2007, the Republicans controlled both houses.
__________________________________________________________________________________________
[i] The commenter has become excessively partisan in most comments. There is no need to push
your political agenda so strongly on this blog. [/i]
– Elf Lady
RE: “Not one of the economic conservative posters on T19 will yet own up to the full complicity and misbehavior of the “free market†in all of this mess from beginning to end, . . . ”
Uh right.
Because this isn’t a free-market system that’s falling apart.
After all, on another thread Albany was claiming that Fannie and Freddie were “free market”, making it abundantly clear that he doesn’t have a clue as to what a “free market” is.
Elf lady, I am responding — not advancing. You might better address the personal nature of the responses to me.
Sarah,
Let us reason together. Even if I were the stupidest person on earth, it would not change one iota what McCain has said and quoted here (to which you have not responded), nor would it change what the Wall Street Journal has written and has been posted here (to which you have also not responded), nor does it change the public record of McCain’s campaign staff’s ties to Fannie and Freddie (to which you again do not respond).
Like Tom’s sarcasm, your personal mockery is non-responsive to anything substantive here. Sadly, I have come to see this as a pattern. Please don’t respond to me personally, but to what has been posted on this thread. Thank you.