Gifts and Loans


The NYTimes editorial page (which endorsed the $700 billion bailout one month ago) now bemoans the behavior of recipient banks.
Now, lo and behold, with $250 billion in bailout funds committed to dozens of large and regional banks, it turns out that many of the recipients of this investment from taxpayers are not all that interested in making loans
Shockingly, the banks are not using the government's gift to extend loans, but to... wait for it.... buy up smaller, more profitable banks. That way, if JP Morgan Chase fails, an even bigger chunk of the banking industry goes down with her. Banking executives naturally want to protect their own futures, and ensure that everybody in the industry keeps getting a paycheck. Getting a big fat check from Uncle Sam is not going to turn them into philanthropists.

As I wrote to my Congresswoman last month,
Remember, what brought on this crisis was exuberant lending. No amount of bailing out is going to make bad loans look good to bankers now. An unsound business model is still going to be unsound, even if a government handout allows it to be solvent for a few extra weeks or months.
Banks behavior is perfectly rational. And perhaps politicians' behavior is also rational: they want to protect their jobs and benefit those who donate to their campaigns.

Will voters be rational next Tuesday, and throw out da bums? Here's a clarion call to voters of both parties: if the incumbents in your district and state voted for the bailout, vote against them on Tuesday. Let them know that we disapprove in real polls, not just the ones pollsters conduct.

Posted by Chops at October 29, 2008 12:58 PM
Comments
Comment #268755

Chops,

Considering Paulsen’s “plan” will loose Paulsen in 3 months, I’m not sure voting against incumbents will have much effect, since the incumbent that really matters here is GW Bush. Am I to take this as an endorsement of Obama, even though he was for the plan as well?

Posted by: googlumpugus at October 29, 2008 9:50 PM
Comment #268764

Are we blaming the New York Times for the bad bailout plan?

Posted by: Max at October 29, 2008 11:01 PM
Comment #268777

I think the lesson from all this, that we ignore at our peril, is that in spite of what ideologue free-marketers would have us believe the unbridled free market hasn’t done, doesn’t do and never will do the “right thing”.

The only thing the free market is capable of is immediately making a ton of money and/or taking advantage of circumstances in order to eventually make a ton of money.

Free-market ideologues would have us all believe that it is always a benefit to society at large for the free market to do the only thing it is capable of doing.

This might be partially true if everyone from top to bottom of the capitalist structure had the same opportunity for enrichment within the structure, but we all know that’s not true: the ratio of income accrued to the highest-paid employee and the lowest-paid employee in most organizations has never been greater (i.e. more inequitable or less fair).

Consequently, as we have seen again and again and yet again (Enron, Worldcom, Lehman, Bear Stearns), it is clear that the captains of industry gladly dash the ship upon the reef if it means more millions of dollars in their personal pockets.

Personally, at this point I have contacted all my representatives (congressmen, Senators, the White House) asking them to demand the immediate resignation of the incompetents Cox, Bernanke and Paulson.

They need to stop the hare-brained schemes that are merely getting this economy in more trouble and enriching their cronies.

I’ve also called on Bush and his entire administration to resign effective November 5, or whenever a clear winner of the presidential election has been determined, whichever comes first.

Posted by: EJN at October 30, 2008 8:42 AM
Comment #268802

Googlumpugus -
The way you tell it, GW Bush is responsible for the actions of Congress. But which party really pushed this through? Bush is certainly guilty of supporting (and signing) a lousy bill. But that doesn’t exonerate Congress from passing it!

Max -
Uh, no. The NYTimes is now balking at how badly the plan is working. They look dumb for flip-flopping on the plan, but I wish more Congressmen would flip-flop along with them!

EJN -
What we need is more and freer markets. This crisis arose because of government intervention (Fannie and Freddie, anyone?) and has been exacerbated by government intervention (the bailout). If markets were allowed to work smoothly, people who want to take risks could make or lose a lot of money, and people who don’t want to take risks wouldn’t be asked to clean up the mess in taxes!

Posted by: Chops at October 30, 2008 11:01 AM
Comment #268814

Chops,

Why do continue to insist that Fannie and Freddie are the culprits here? Fannie and Freddie were mere pawns in the scheme of things. Think Derivative, think Bundling, etc., think two steps above F&F for the problems facing our economy…left on their own F&F would have caused a blip on the radar of stock markets…not caused the destruction of them.

The totally free, unsupervised market in the rarefied atmosphere of super finance caused the collapse, and that was as a result of Gramm,et al.

The ‘Free Market’ ate itself.

Posted by: Marysdude at October 30, 2008 11:55 AM
Comment #268818

Free? LOL

More accurately, the Market ate itself.

F&F had as much to do with it as the Graham bill that you reference. Meaning both were partial players.

Posted by: Rhinehold at October 30, 2008 12:11 PM
Comment #268826

Chops, more than that, Bush’s administration is the originator of the bill, or are you saying he bears no responsibility for what his administration proposes?

Posted by: googlumpugus at October 30, 2008 12:47 PM
Comment #268829

I was against these God-awful socialist bail-outs from the start as it was not difficult to perceive where they would lead.

Now, we have the big 3 automakers lining up at the trough as well as the majority of our state governments. Well…since Washington has already taken over Mae and Mac, and purchased stakes in banks and insurance companies…some automaker shares might balance out the federal portfolio. Before long, we’ll see other industries added to government holdings and perhaps eventually find the federal government listed on the NASDAQ.

Posted by: Jim M at October 30, 2008 12:59 PM
Comment #268842

Perhaps we should have the oil companies bail out the banks, or perhaps the government should buy stock in the oil companies to balance their portfolio?

Exxon Mobil posts biggest US quarterly profit ever

Posted by: womanmarine at October 30, 2008 1:46 PM
Comment #268849

womanmarine,

Now, that’s a GOOD idea…

Posted by: Marysdude at October 30, 2008 2:29 PM
Comment #268851

Rhinehold,

We will never agree on this, but making bad loans did not cause this fiasco…buying bundles of bad loans and having them insured without the funds to pay them off and not knowing the value of the bundles and speculating as to their worth and forgetting they could not be paid off if there was a downturn…on and…on and…on. You just don’t seem to be able to comprehend that bad loans, well insured, were still an asset as long as the value was known. It was in the rarefied atmosphere of BIG money that the system failed, and that part was, and is still not regulated or supervised. That lack is directly a result of Gramm.

Posted by: Marysdude at October 30, 2008 2:36 PM
Comment #268858

Chops, restoring confidence in the future after having our economic system shaken to its core, is never as simple as making more money available, though in this case, that is prerequisite.

It will take time, this is not a TV 22 minute sitcom in which the world’s problems can be defined and resolved in one episode.

Simplistic views like yours and those you quote, “Oh, Well, it hasn’t worked”, before all the money has even been made available, and all the fronts of attack have even been launched, is a bit of an adolescent approach to major and complex scenarios like we face now in reality.

This isn’t TVLand. This is real life, where things take time, work, effort, patience, and persistence, and some luck, to achieve desired goals.

Posted by: David R. Remer at October 30, 2008 2:55 PM
Comment #268859


If there is an ism at play here, it certainly isn’t socialism. Fascism is more appropriate. It is rather obvious that the government does as it pleases irreguardless of the wishes of the people.

The republicans play the national defense and freemarket cards. The democrats play the freemarket with regulation and the redistribute the wealth cards. Both conspire to silence other voices.

The democrats and the republicans joined forces to create the conditions that led to the housing bubble bust and the banking crisis. Now rather than take responsibility for what they have done, they throw the taxpayers money at the problem and blame each other.

The people are in a catch 22 quagmire. Replace the democrats with republicans, replace the republicans with democrats, it makes little difference, the game goes on.

No matter which candidate wins the election, two things are a certainty. Our people will be deeper in debt and worse off when the next one leaves office.

Posted by: jlw at October 30, 2008 2:57 PM
Comment #268861

Marysdude, making bad loans WAS a major component of this fiasco, in terms of mortgages equaling the then market value of the property. Texas is relatively free of this debacle for one simple reason, a law requiring ALL mortgages be written for NO MORE than 80% of the market value of the property. This common sense and prudent measure by Texas Lawmakers prevented an enormous number of foreclosures on Texas homes as property values dropped.

Posted by: David R. Remer at October 30, 2008 2:58 PM
Comment #268863

womanmarine wrote: “Perhaps we should have the oil companies bail out the banks, or perhaps the government should buy stock in the oil companies to balance their portfolio?”

I would assume this was written in jest. How about this…have the current surplus of premiums over benefits in the SS fund buy stock in the oil companies? OH WAIT…we can’t do that as Obama and his socialist dominated congress is going to confiscate the “obscene profits” from the oil companies to spend for something more worthwhile than SS. Of course, without profit the oil companies will stop exploring and drilling and we can buy even more oil from our enemies and send billions more of our wealth to them to fund terrorist organizations.

I read that the obscene profit by Exxon you linked to paid somewhere in the neighborhood of $500 million in taxes on that profit. But, how can that be? Nearly every day on this blog I read that these corporations don’t pay taxes because of all the loopholes.

Posted by: Jim M at October 30, 2008 3:09 PM
Comment #268864

Jim M:

The funny part of all this is your suggestion that SS buy into the market (oil company stock). We’ve seen how dependable and failure-proof the market is. Bad idea.

And had it not been for loopholes how much more would they have paid in taxes? How do the taxes they paid compare to the subsidies they were given?

Posted by: womanmarine at October 30, 2008 3:15 PM
Comment #268865

Subsidies, BTW, that they testified before congress that they didn’t need? I didn’t see them giving them back.

Posted by: womanmarine at October 30, 2008 3:16 PM
Comment #268869

Remer wrote; “This isn’t TVLand. This is real life, where things take time, work, effort, patience, and persistence, and some luck, to achieve desired goals.”

Shhhhh, Remer, should the Obama disciples discover that he has no magic TV wand to wave over the problem there will be rioting in the streets. Obama socialists followers believe in the Fake Monoply Money we’re spending today for bailouts and that this same Fake money will be mailed to them as a tax refund on taxes they don’t pay.

For decades we have paid farmers not to grow crops, encouraged the poor to remain on the public dole and increase their numbers, welcomed the illegal aliens to flow into our country to suck up unearned welfare benefits, and promoted class envy. And Remer doesn’t think we are already living in TVland? Remer and others never tire of telling us that we could tax our way out of the oil shortage that existed before our current crisis and now are telling us that we can also tax our way to “fairness” and prosperity.

And…he and his fellow believers would have us believe that only higher taxes can save the planet from MMGW. Is there a common theme here? For them, higher taxes are the answer to every problem.

Posted by: Jim M at October 30, 2008 3:28 PM
Comment #268872

womanmarine wrote; “Subsidies, BTW, that they testified before congress that they didn’t need? I didn’t see them giving them back.”

Glad you found the intended humor in my spoof. My question is; why didn’t the liberal democrat congress takes those loopholes away? Does anyone voluntarily give money to Washington beyond what they legally must? Do Gates, Soros, Buffet and many other billionaires give money to Washington that isn’t required in our tax code? Do you?

Hell, Obama won’t even share some of his substantial wealth with his own family. As usual, liberal socialists want to spend someone else’s hard earned money to further their goals and keep theirs in their pocket.

Posted by: Jim M at October 30, 2008 3:39 PM
Comment #268873

DRR,

Sure F&F had some impact on the mess-at-hand…but that impact was insignificant compared to those un-valued bundles and the non-backed insurance that covered them and the…and the…

Posted by: Marysdude at October 30, 2008 3:59 PM
Comment #268883

Chops: What we need is more and freer markets.

No, you’re wrong. It is the failure of the Bush administration to perform any regulation until the market got to a critical point that caused this crisis.

In any given situation, companies will always do the one thing to enrich the wallets of the guys running the company, not what is in anyone else’s best interest.

If you really think that less regulation would have helped prevent this crisis, you are exactly like person in the parable who expects something different to happen everytime he takes the same action.

Chops: This crisis arose because of government intervention (Fannie and Freddie, anyone?)

Nope. Everybody on the right, even McSame, says “Hey, I tried to make them slow Fannie and Freddie down because they were making bad, risky loans. But the Dems wouldn’t let me”, right? McSame and Palin both have said the same thing out on the campaign trail. Remember Barney Frank, saying everything’s fine, don’t regulate them anymore? If you really believe that Frannie and Freddie were OVER-regulated, you are the first person in the world who has admitted that in public.

Chops: has been exacerbated by government intervention

The bailout was a botched response by the Bushies to protect the assets of their rich buddies. But it had nothing to do with causing the problem or making it worse - some say the bailout has helped loosen up the commercial paper market. More regulation could have prevented the crisis or made it less severe. Not doing the bailout would not have prevented it and would not have made it less severe.

Chops: If markets were allowed to work smoothly, people who want to take risks could make or lose a lot of money, and people who don’t want to take risks wouldn’t be asked to clean up the mess in taxes!

The markets were working too smoothly, especially when they were loaning hundreds of thousands of dollars to people on variable-rate mortgages with no down payment and no proof of income, with the only hope of success being that the prices of real estate never dropping.

They were shoveling the money out the door faster than it was coming in because they didn’t stop to take an honest look at the risks they were taking. Had they been reulated, the regulators would have looked at their books one month or quarter and said “WHOA!! WHOA!! This has got to stop!!!”

The only reason the bailout took place is that your fellow free-marketers, the Bushies, were too fr—-ing dumb to think of anything else to do. You can’t blame too much regulation on that.

The way it was put to the US taxpayer by the thieves Bernanke and Paulson is that we had no choice - we could not let these banks fail or it would have destroyed the economy.

Now I didn’t believe them for a second but are you telling me you know better than they do what would have happened had they let the banks fail?

I’d be interested in knowing how you came up with this theory that less regulation would have prevented the current economic crisis or made it less severe. Who else that anyone’s ever heard of shares your view?

Posted by: EJN at October 30, 2008 4:42 PM
Comment #268888

It’s really funny: for 66 years from 1933 to 1999, we had this little thing in this country called the Glass-Steagall Act which put a wall between the unregulated activities of investment banks like Bear Stearns and Lehman, and commercial banks like mine, Commerce Bank. The investment banks were relatively unregulated and could take big risks. The commercial banks were FDIC guaranteed, regulated and were not generally allowed to take on much risk.

The along came the Republicans, (led by Phil Gramm, who is John McCain’s economic advisor and a leading candidate for Sec. of Treasury if McCain becomes president; you may remember Gramm for calling the US a “nation of whiners” because many were experiencing the effects of an incipient recession) who proposed and ramrodded a bill which repealed Glass-Steagall, i.e. de-regulated banking.

Most people who are not deranged primarily blame that one fateful move for our current crisis.

So Chops, you want to explain how it is that more de-regulation would have prevented this crisis?

Posted by: EJN at October 30, 2008 5:05 PM
Comment #268930

Womanmarine said:

“Perhaps we should have the oil companies bail out the banks, or perhaps the government should buy stock in the oil companies to balance their portfolio?

Exxon Mobil posts biggest US quarterly profit ever”

Here we go again, attacking those mean old oil companies. Jim M is right, we should invest the SS money in Exxon. Wouldn’t it have been nice to have some of that $14.83 billion in SS?

Jim M

“I read that the obscene profit by Exxon you linked to paid somewhere in the neighborhood of $500 million in taxes on that profit.”

Actually, They paid higher taxes: “The company paid a 43.3% tax rate. It paid $11.33 billion in income taxes,$9.33 billion in sales taxes and $11.85 billion in other taxes. That means it paid total taxes of $32.51 billion in the current quarter.”

Exxon made $9.32 billion in the first quarter and paid a total of $29.3 billion in taxes.

http://seekingalpha.com/article/75132-exxon-s-record-9-32-billion-q1-income-taxes-update

I believe the left on this website are the only ones who don’t know Freddie and Fannie were the cause of the financial crisis and not just here, but globally. They deny this because it points the blame at the democrats.

“Sure F&F had some impact on the mess-at-hand…but that impact was insignificant compared to those un-valued bundles and the non-backed insurance that covered them and the…and the…”

This is the closest I have ever come to seeing a lib agree. The undervalued bundles were picked up by CEO’s of F&F to boost their investments and qualify for a bigger bonus.

Posted by: Oldguy at October 30, 2008 10:09 PM
Comment #268946

Vote for which presidential nominee you want to walk the plank:

http://www.pursuitofinfamy.com/mccain-vs-obama/

http://www.pursuitofinfamy.com/mccain-vs-obama/

Posted by: Mike Rodgers at October 31, 2008 5:24 AM
Comment #268962

David -

I agree that the problems we face are long-term, not instant, and we can’t expect instant resolution. So why did you and others support the snap judgment in Washington to spend 5% of GDP on an unconsidered plan? This isn’t TV - but Washington’s bailout was precisely made-for-TV. They were more concerned with “appearing to do something big” than with the mechanics of what they actually did.

The burden of proof is on bailout supporters, not opponents. If it was so vital that the bill be passed within a couple days - without research, public discussion, etc - that ought to mean there were short-term benefits that we should have seen. I’m not seeing those benefits, and the burden of proof remains with bailout proponents.

Why a burden of proof? Because Congress and Bush are charging taxpayers 5% of their income this year. It’s not too late to stop some of those payments. Before “buying” any more of what Washington is selling, I think we should take a good, long, nonpartisan look in the horse’s mouth.

When you see the bailout accomplish something good, please, please for all of our sakes, write it up. Explain (with data, of course) how this huge increase in government debt and future taxes is helping me!

Posted by: Chops at October 31, 2008 9:45 AM
Comment #268973


Chops: This problem and many others that we face, energy, health care,etc. was not caused by government intervention. All of these problems are being caused by a government takeover. These so called free market corporations have bought themselves a government and they are buying more governments every day.

Not only did the corporations write the laws that got us into this mess, they also wrote the bailout plan, enhanced with pork for the reluctant politicians, that is supposed to get us out of the trouble.

In the past 30 yeras, nearly all of the important legislation that has been passed was heavily influnced by or actually written by industry executives or industry lobbyists. Take your pick, the energy bill, the banking bills, the perscription drug act, even Obama’s universal healthcare plan.

Rather than call for the ouster of the corrupt politicians in their own party, both parties play the blame the other party game. This has created a reality in which both parties, including their voters and many independent voters have capitulated to rule by corporations.

If the voters continue to ignore the problem, claim that the problem is something else, it will get worse.

The primary reason we as a people refuse to recognize the true problem is we have become a nation that idolizes an ideology called capitalism.

Let’s all bow our heads and pray for the swift recovery of our God. Let’s hope that God recovers enough to grant us that new car loan before the end of the year sales.

Posted by: jlw at October 31, 2008 1:00 PM
Comment #268976

Thanks to oldguy for doing the research. “Exxon made $9.32 billion in the first quarter and paid a total of $29.3 billion in taxes.”

http://seekingalpha.com/article/75132-exxon-s-record-9-32-billion-q1-income-taxes-update

Posted by: Jim M at October 31, 2008 1:35 PM
Comment #269020

Oldguy and Jim M -

Gotta be careful with your stats. For one thing, your numbers seem to indicate Exxon had a $20B LOSS for the first quarter. I think we all know that’s not the case. Try to be more careful next time, please.

And when it comes to Fannie and Freddie CAUSING the meltdown, NO, that is NOT the case.

Here is some interesting data:

“Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent”

Not only that, but according to Federal Reserve Board data:

* More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions.
* Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year.
* Only one of the top 25 subprime lenders in 2006 was directly subject to the housing law (the Community Reinvestment Act (CRA)) that’s being lambasted by conservative critics.

The CRA was weakened initially under Clinton (the bill was sponsored by McCain economic adviser Phil Gramm), and weakened further in ‘05.

No, Fannie and Freddie are NOT to blame - how could they be when they controlled so little of the market? Fannie and Freddie are NOT blameless…but the majority of the blame rests with the reckless deregulation of the industry…and part of the blame rests with Bill Clinton who agreed with the economic theory put forward by Phil Gramm and Alan Greenspan.

At least Greenspan had the courage and intestinal fortitude to admit he was wrong. Clinton hasn’t, Gramm hasn’t, and the vast majority of the Republican party still believes in the ‘trickle-down and deregulation’ gospel.

Posted by: Glenn Contrarian at October 31, 2008 8:07 PM
Comment #269021

And remember, as I’ve posted SEVERAL times on this blog, in 2003, the Attorneys General of ALL FIFTY STATES (Dem AND Republican) sent a letter to Bush to tell him that the lack of regulation of the lending industry would lead to dire economic consequences…and the Bush administration not only ignored the letter, but used a Civil War-era law to not only prevent any further regulation of the lending industry but also to negate any regulation the states had already implemented by that time.

The Attorneys General AND the Banking Superintendents of ALL FIFTY STATES (Dem AND Republican) protested the Bush administration’s action…to no avail. You see the result.

Oldguy and Jim M - unless you feel you know more than the Attorneys General AND the Banking Superintendents of ALL FIFTY STATES, please open your minds to reality, please.

Posted by: Glenn Contrarian at October 31, 2008 8:12 PM
Comment #269033

GC

It’s not really that hard to understand, if you would open your eyes to reality.

From the link you posted, you forgot to recognize one thing:

“Conservative columnist Charles Krauthammer wrote recently that while the goal of the CRA was admirable, “it led to tremendous pressure on Fannie Mae and Freddie Mac — who in turn pressured banks and other lenders — to extend mortgages to people who were borrowing over their heads. That’s called subprime lending. It lies at the root of our current calamity.”

So subprime loans were the cause of the problem. Freddie and Fannie pressured banks to make subprime loans to low-income and minorities without any security or even proof of employment. Not only did F&F pressure the banks, but Clinton’s Attorney General Janet Reno also pressured the banks, under fear of legal action.

1.http://findarticles.com/p/articles/mi_m1355/is_n19_v86/ai_15779827?tag=content;col1

2.http://newsblaze.com/story/20081003083414zzzz.nb/topstory.html

This is from your link and incorrectly states the truth,

“Federal housing data reveal that the charges aren’t true, and that the private sector, not the government or government-backed companies, was behind the soaring subprime lending at the core of the crisis.”

The private sector WAS behind the soaring subprime lending, but it was F&F with Reno who pressured them to loan.

Again, from your link,

“Fannie, the Federal National Mortgage Association, and Freddie, the Federal Home Loan Mortgage Corp., don’t lend money, to minorities or anyone else, however. They purchase loans from the private lenders who actually underwrite the loans.
It’s a process called securitization, and by passing on the loans, banks have more capital on hand so they can lend even more.
This much is true. In an effort to promote affordable home ownership for minorities and rural whites, the Department of Housing and Urban Development set targets for Fannie and Freddie in 1992 to purchase low-income loans for sale into the secondary market that eventually reached this number: 52 percent of loans given to low-to moderate-income families.”

HUD set targets for F&F to purchase packaged loans from the banks and loan institutions. The pay and bonuses for F&F’s managers was based upon the increase of loans bought:

Again, in my link #2,

“In 1997, The Clinton administration, pushing the socialist idea that home ownership is a right of all Americans, placed even more pressure on banks to grant even more mortgages to the poor, minorities and people with bad credit. Reacting to the pressure applied by the Clinton Administration and the threat of federal lawsuits by Janet Reno, American banks began making thousands of bad loans, many with no money down, no documentation and even loans for up to 120% of actual values. Executives at Fannie Mae started to receive huge bonuses when mortgage loans targets were met. To help push the program, Franklin Raines and Jamie Garelick, from the Clinton Administration, were given top positions in Fannie Mae.

In 1998, Fannie Mae reported the following bonuses to some of their executives: chairman and chief executive James A. Johnson received $1.932 million; Franklin D. Raines, chairman-designate, received $1.11 million; Chief Operating Officer Lawrence M. Small received $1.108 million; Vice Chairman Jamie S. Gorelick received $779,625; Chief Financial Officer J. Timothy Howard received $493,750; and Robert J. Levin, an executive vice president, received $493,750. These bonuses increased in future years as fraudelent entries were made in the financial records.”

Your article incorrectly states it was in 1999 that the Clinton Administration pressured Banks, but in reality Clinton through HUD did the pressuring on F&F in 1997.

Next move from #2:

“In 2003, President George Bush called for legislation to give the government more oversight of Fannie Mae and Freddie Mac, but his proposal fell on deaf congressional ears, many of whose members were receiving substantial bribes (I mean campaign contributions) from Fannie Mae and Freddie Mac. In 2004, the Office of Management and Budget, found that massive fraudulent bookkeeping practices were occurring at Fannie Mae and that these practices were very similar to the fraudelent practices in the Enron Corp case. The OMB determined that these annual false mortgage statistics were used to justify the top executives getting excessive bonuses every year.

The Gramm-Leach-Bliley Act merely allowed commercial and investment banks to consolidate. It did not change the pressure that was being placed on banks to make subprime loans.

“The Gramm-Leach-Bliley Act, which passed the U.S. Senate in one form on a party-line vote of 54 (53 Republicans and 1 Democrat) to 44 (all Democrats) and on a 343-86 vote in a different form in the House of Representatives, before being resolved by a joint conference committee; the conference report was approved by both houses of Congress (Senate: 90-8-1, House: 362-57-15) and signed by President Bill Clinton.”

http://en.wikipedia.org/wiki/Glass-Steagall_Act

The last point I would like to make is the involvement of ACORN in this scam, link #2:

“Another socialist Racist group ACORN (Association of Community Organizations for Reform Now) demanded “affirmative action” in all lending practices and programs. They pressured banks to make subprime loans to poor people of color with bad credit. Madeline Talbott, a Chicago ACORN leader, has even boasted of “dragging banks kicking and screaming” into these dubious loans. As conservative community activist Robert Woodson put it, “The same corporations that pay ransom to Jesse Jackson and Al Sharpton also pay ransom to ACORN.” The ACORN organization actively supports candidates of the Democratic Party and many ACORN people have also been arrested on various charges involving voter fraud.

To make matters worse, The most recent House and Senate Democratic bail-out legislation contained a well-hidden provision that would forward some of the profits, indirectly, to help fund organizations like LaRaza and ACORN. If this provision is included in the final versions, the American taxpayer will be giving more cash to the very groups that helped create the lending mess in the first place.”

To add to that, BHO was involved up to his neck with ACORN and the whole scam.


Posted by: Oldguy at October 31, 2008 9:49 PM
Comment #269076

Oldguy -

You and I will agree to disagree on Fannie and Freddie…but please note that I blamed Clinton, too.

But when it comes to ACORN and ‘voter fraud’, you, sir, are a victim of the right-wing propaganda machine. ACORN turned in about 1.3 million forms. Of those, about 400,000 were rejected. Why? Was it MASSIVE VOTER REGISTRATION FRAUD as the right-wing pundits claimed?

Of the 1.3 million, about 400,000 were new registrations. Here’s what the New York Times investigation found:

“The remainder are registered voters who were changing their address and roughly 400,000 that were rejected by election officials for a variety of reasons, including duplicate registrations, incomplete forms and fraudulent submissions”

“Most of the registrations that were rejected were duplicate forms, followed by incomplete forms. The Acorn officials said their investigation found about 9,000 voter registration cards that were determined to be fraudulent. A lawyer for the group estimated that perhaps 5,000 to 6,000 more cards employees turned in were fraudulent. Acorn officials said that 20 percent to 25 percent of the applications it submitted were likely duplicates, 5 percent were incomplete, and 1 percent to 1.5 percent were fraudulent.

1 to 1.5 percent, Oldguy. And was ACORN encouraging voter registration fraud in any way?

“The group also said it was forced to fire 829 of the 10,000 canvassers it hired during the election for job-related problems, including falsifying registration forms. Acorn officials say they pay canvassers an hourly wage and not by the number of forms they obtain.

And are those duplicate registrations fraudulent? No.

If one doesn’t have the means to check to see if they are already registered, is one going to take time off from work to go to the Elections Commission or wherever during work hours to double-check their registration status? Especially if they do NOT have access to the internet or their local commission doesn’t have registration status online?

No. They will just fill out another one, just to make sure they can vote.

Just wanted to clear this up for you before you go thinking that duplicate registrations are automatically fraudulent. They aren’t unless the one filling out the registration already knows one is already registered.

Try looking at both sides of the story next time, please. ACORN did not commit ‘massive voter registration fraud’…and committed NO voter fraud at all (note the difference, please). If you want to talk voter suppression, voter fraud, and the far more serious ELECTION fraud, Oldguy, then let’s talk…’cause your Republicans have committed voter suppression and election fraud to a far greater extent than most people think.

On economic subjects you might prove me wrong…but not on Universal Health Care, and not on voter suppression and election fraud. The evidence and numbers are almost entirely against you.

Posted by: Glenn Contrarian at November 1, 2008 1:26 PM
Comment #269080


Glenn: Are you saying that if Clinton would have opposed the Gramm bill, the democrats in Congress would not have voted, in overwhelming numbers, for the bill or that enough of those democrats would not have voted with the republicans to override his veto?

Posted by: jlw at November 1, 2008 2:18 PM
Comment #269081

Glenn,

If you told Old that F&F were just a small part of the current meltdown, you did not lose to him. It is true, F&F were just a small part of it…if left alone, the part F&F played in it would have been quickly solved, and the meltdown would never have occurred.

If he has a problem with what you say about voter suppression, tell him to drop down to Georgia, where the Republican governor and the Republican Secretary of State, have done just about everything except sic the dogs on early voters to get them to go home. Some voters have stood outside, in cold weather, for up to eight hours in order to vote ‘because the state computers had a problem’…yep, you guessed it, the Secretary of State is in charge of those computers…and when Governor Sonny Purdue was asked to copy the Florida emergency program to increase the numbers of open voter precincts, he refused.

Remember that Georgia is the state the Social Security Administration had to turn in for exceeding common decency the numbers of SSN’s requested for voter registrations (about 2 million requests).

I can tell you one thing…they haven’t driven voters off in significant numbers. Voters are getting in line before 7pm, and standing in line until they get to vote, sometimes after 1am the next day.

If mccain wins Georgia, we’ll know the biggest reason. mccain is a small, weak willed man, who allows mean spirited things to be said and done in his name.

Posted by: Marysdude at November 1, 2008 2:34 PM
Comment #269083

>Glenn: Are you saying that if Clinton would have opposed the Gramm bill, the democrats in Congress would not have voted, in overwhelming numbers, for the bill or that enough of those democrats would not have voted with the republicans to override his veto?
Posted by: jlw at November 1, 2008 02:18 PM

jlw,

Clinton did not want to sign Gramm…but knew he’d lose a veto fight. What else needs be said? A president has to pick the fights he can win, or lose his greatest strengths.

One of the reasons he had a successful double term is he stole ideas from the right, compromised with the right and sneaked around and got things done for the left…I think it’s called being a good president. He lost on Gramm, and I doubt if there is anyone in the world who regrets that loss more than he…

Posted by: Marysdude at November 1, 2008 2:42 PM
Comment #269087

Marysdude

So, what is Clinton’s legacy?

Posted by: Oldguy at November 1, 2008 3:09 PM
Comment #269104

>So, what is Clinton’s legacy?
Posted by: Oldguy at November 1, 2008 03:09 PM

Old,

He got things done…most of them good…Gramm and NAFTA are exceptions.

His legacy? Historians determine that. My guess is he’ll go down as one who accomplished much while bedeviled on all sides by a a group of Republican thugs and their puppit-masters.

Posted by: Marysdude at November 1, 2008 5:48 PM
Comment #269109

dude:

I’m thinking “bluedress” and oval office.

Posted by: Oldguy at November 1, 2008 7:06 PM
Comment #269114

Oldguy,

You conveniently forgot the aggressive actions of the Bush administration in promoting the sub-prime market. In 2002, Bush initiated the “Affordable Housing Challenge” which requested among other things: additional mortgage assistance from the private sector for minority and low income groups; passage of the “American Dream Downpayment Act” and a larger commitment by the the GSEs in providing mortgage assistance to those populations, even if that required imposing such standards by regulatory action.

Bush proudly reported in 2003 and 2004 that the “Challenge” had resulted in the passage of the American Dream Downpayment Act providing up to $200 million per year in downpayment assistance for 40,000 low income minorities, 1.1 trillion dollar commitment by the private sector to minority mortgage assistance and 440 Billion in additional GSE assistance. There were additional actions such as tax incentive credits for investments in low income housing.

The attempts by the Bush administration in 2003 toward additional requlation of Fannie Mae were motivated by accounting irregularities not its involvement in minority mortgage assistance. Indeed, at that time, the Bush administration was presuring the GSEs to do more in minority mortgage assistance.

Posted by: Rich at November 1, 2008 7:37 PM
Comment #269121

I hate to be labeled a conspiracy theorist, but I think Cheney/Bush had killing Social Security and Medicare on his mind from the first day. Everything that has happened bad to America during the last seven years, with the exceptions of 9/11 and Katrina, have been intended to that end. I wonder if that isn’t why he lied us into Iraq.

Posted by: Marysdude at November 1, 2008 9:15 PM
Comment #269122

>I’m thinking “bluedress” and oval office.
Posted by: Oldguy at November 1, 2008 07:06 P

Old,

Teehee, teehee…what a jerk, and I ain’t talkin’ about Clinton…

Posted by: Marysdude at November 1, 2008 9:18 PM
Comment #269132

Rich:

Now you know the rules, provide links for proof of what you say.

Dude:

You’re reaching on that one.

Posted by: Oldguy at November 2, 2008 12:12 AM
Comment #269142

Old,

You were reaching on the stain…if we are going to become children, playing nyanyanyananyana, I can do that, just as well as you…

Posted by: Marysdude at November 2, 2008 3:05 AM
Comment #269147

Sorry Oldguy about failing to provide specific references to my assertions.

http://www.whitehouse.gov/infocus/homeownership/toc.html This document, released in 2002, outlines the initial plan of the Bush administration for increasing minority and low income home ownership by 5.5 million by providing downpayment assistance and encouraging private and GSE mortgage assistance. It contained the following statement regarding GSEs: “The government-sponsored corporations created to increase the liquidity of mortgage markets, so more capital would be available for mortgage loans, are supposed to lead the market in reaching underserved populations. While these corporations have increased their commitments to these efforts, they lag behind private lenders in this regard, according to government studies. The Administration will revisit the regulatory goals for these corporations’ purchases of affordable housing loans, which are set to expire in 2003. The federal government should demand more and should hold such publicly-chartered corporations accountable for better performance.”


http://www.whitehouse.gov/news/releases/2004/09/20040902-5.html This document released in 2004 reviews the accomplishments of the administration and proposes additional actions to increase the original goal of 5.5 million new minority homeowners to 7.7 million. The accomplishments included: passage of the American Dream Downpayment Act providing for 200 million dollars per year for 40,000 low income buyers; private sector pledges of 1.1 trillion dollars in mortgage assistance; 440 billion increased commitments by GSEs; tax incentives for low income housing, etc.


Posted by: Rich at November 2, 2008 7:51 AM
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