Article by Mike Reagan (conservative columnist) re. mortgage crisis

[Halftime Hope]

Forewarned: if you read this, it's because you've got your big kid pants on, and you can take it. :)

 

 

 

 

 

Democrats Own the Wall Street Debacle

 

 

Thursday, September 18, 2008 4:22 PM

 

By: Michael Reagan Article Font Size <IMG border=0> <IMG border=0>

 

 

 

 

When I was a little boy, we used to play a game where we wore a blindfold and tried to put a slip of paper on a drawing of a donkey we couldn't see. I thought of that as I watched the chattering class, blindfolded and frantically trying to pin the blame for the Wall Street debacle on everything but the real donkey, the Democrats, whose symbol is . . . guess what?

 

Right — a donkey, and that's where the blame lies, on Barack Obama's Democratic Party.

 

To find the donkey, you need to go back to the Clinton administration, which decided that everybody and his kid brother was entitled to a mortgage even when they didn't begin to qualify for a home loan.

 

In saner days, banks designated certain areas as no-loan zones — depressed neighborhoods where lending money to potential home buyers was not just a risky investment, but a certain future foreclosure.

 

Critics of the practice called it "redlining," and President Clinton and his chums on Capitol Hill decided that banks should no longer act like banks and lend money only to home buyers who could afford to handle the monthly payments. Now all bets would be off and people not the least bit creditworthy — and speculators — would be entitled by law to obtain mortgages even when it was obvious they couldn't afford to handle them.

 

Enter those now infamous quasi-government banking instruments known as Fannie Mae and Freddie Mac, which poured fresh money into the banking system by buying mortgages from banks. Over the long haul, they managed to load up their portfolios with billions upon billions of dollars of risky mortgage paper that banks had been forced to offer and then dumped on them.

 

The scandal of Fannie Mae and Freddie Mac dwarfs the Enron debacle. In Enron, people went to jail. With the Fannies, some just walked away with millions.

 

The collapse of Lehman Brothers can be blamed on Fannie Mae and Freddie Mac, the two big mortgage banks that the Feds recently bailed out with big bucks. As Fox News has pointed out, they used huge lobbying budgets and political contributions to keep regulators off their backs.

 

According to the Center for Responsive Politics, the top three U.S. senators getting big Fannie and Freddie political bucks were Democrats, and No. 2 was Sen. Barack Obama, who as Fox noted had only been in the Senate four years but still managed to grab that No. 2 spot ahead of longtime colleagues John Kerry and Chris Dodd, the chairman of the Senate Banking Committee.

 

According to Fox, Fannie and Freddie were where big-time Washington Democrats went to work and pocketed millions. Franklin Raines, Clinton's White House Budget Director, ran Fannie and collected $50 million.

 

Jamie Gorelick, an official in Clinton's Justice Department — the woman who built the "wall" that prevented the FBI from targeting terrorists before 9/11 — worked for Fannie Mae and took home $26 million. Big-time Democrat Jim Johnson, who headed Obama's VP search committee, also hauled in millions from running Fannie Mae.

 

Obama brazenly blames John McCain and the GOP for the current Wall Street mess when it's clear none of it was due to Republican policies. The truth of the matter is that it was McCain and three GOP colleagues who sought to reform the government's lending policies three long years ago after the Bush administration had failed two years earlier. On May 25, 2006, McCain spoke on behalf of the Federal Housing Enterprise Regulatory Reform Act of 2005, and warned against the debacle we are now facing if it failed to pass.

 

He told the Senate that a report by the Office of Federal Housing Enterprise Oversight charged that "Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives."

 

McCain warned, "If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole."

 

McCain predicted the entire collapse we now are suffering through. He stressed the falsification of financial records to benefit executives, including Obama advisers Franklin Raines and Jim Johnson.

 

Now Obama has the nerve to try to pin the blame on McCain and the GOP when the facts show that the blame must be pinned on the Democratic donkey.

 

 

 

© 2008 Mike Reagan

[Mamagistra]

Jamie Gorelick, an official in Clinton's Justice Department...

 

OK, is that really a name?! :smilielol5:

[Moxie]

Thanks for the article!

[laylamcb]

I'm less interested in who is to blame (as far as I can see it, there's PLENTY of blame to go around) than in what we're going to do about it. And as far as I can tell, the current plan is to take my hard-earned money and throw as much of it at Wall Street as possible, hoping that some of it will stick. We're going to use just about all the money we have left to buy up "assets" that are deemed so worthless that they caused the Cascading Credit Catastrophe that we're in now.

 

I think this is a BIGGER recipe for disaster than the current crisis itself.

 

:chillpill: (This is for me, by the way. Been popping 'em like mad since this bailout plan first reared its ugly head.)

[Michele B]

I'm none too happy about the current mess either, and I am glad my name is not Gorelick. Anne Coulter ( I know, flame thrower extordinaire) had a similar take on it. When you lend to people who don't have the income and securities to pay, you are asking for trouble. What to do now?

 

And we have no gas in Georgia right now -please ! someone in the government - stop grandstanding and do something!

[Academy of Jedi Arts]

I live in an area where the trend is to build new new new. The older parts of town, the houses in neighborhoods with yards, sidewalks, and other features which make them look like real neighborhoods are being left to decay. One reason they are decaying at such a rapid rate is because of so many people renting out the homes. Nice, large houses are being turned into boarding houses and are not well kept. The homes that people are buying have a nicely kept lawn, flowers in the flower boxes, etc. I think it should be EASIER for people to get loans to buy in these areas (providing their income has been verified and they can pay these loans back).

[Vida Winter]

I would love to see Fannie Mae and Freddie Mac just die rather than bail them out. In any event I think the next few years are going to be rough and I'd rather our country not go into an extra trillion dollars in debt. I agree with the article posted although Mike Reagan is not my favorite conservative. Actually my favorite conservatives are Thomas Sowell and Walter Williams, both economists.

 

This mess is the result of government monkeying with the free market. Any time the free market is altered, there are repercussions. We are seeing the result of two extremely powerful quasi-governmental agencies that were not subject to free market rules. The market has spoken; it is a huge cough.

 

If the bailout happens, it too will have results that are hard to predict. The market will cough again, and the bailout money will be lost as well.

 

:chillpill: Takin' my pill now.

 

~Dana

[RebeccaC]

Thanks for posting this. Dh and I were talking about what McCain tried to do a bout this in 05 and his going back to DC to help or at least vote on this just confirmed that we are voting for the right guy.

[Halftime Hope]

Sorry -- this was supposed to go under laylamcb's post. I agree with there being blame enough to go around.

 

I appreciated this article, because the mainstream media is sure not handing out primers on how we got here.

 

BTW, I disagree with the notion of "the poor banks" who *had* to lend. No, they took advantage of it. They tried to tell dh and I how much we could "afford", and it was nearly twice what we thought would be prudent, and we had good credit! In the meantime, if I were to try to sell my house now, I'd likely get $25-30K less than what we paid last summer.

Thank goodness I don't have to move.

 

Here's what I think really stinks:

 

We still have some years before dh hits traditional retirement age. For those who are within a couple of years of retirement, whose money is locked in their 401Ks, who have been fiscally responsible all their lives, the situation really, really stinks! They've taken a huge hit in the market, and many of them don't have much choice where to put their retirement savings.

 

We have friends who lost a huge amount in the market in the aftermath of the dot-com bust and 9/11. They decided to move to Belize for their retirement, because that's where they could afford to live. My heart aches for them, not being a part of their grandchildren's lives, but that's the choice they made. ?? I think I'd rather try something else, but who know what options I'll have as a retiree.

[Moxie]

I'm less interested in who is to blame (as far as I can see it, there's PLENTY of blame to go around) than in what we're going to do about it.

 

Yes, there are plenty of people to blame, but I really do think we need to examine what went wrong and who is to blame so we can make sure it doesn't happen again and that the same people no longer have power.

[Slartibartfast]

http://www.motherjones.com/mojoblog/archives/2008/09/9718_mccain_lehman_crisis_gramm.html

 

As Mother Jones reported in June, eight years ago, Gramm, then a Republican senator chairing the Senate banking committee, slipped a 262-page bill into a gargantuan, must-pass spending measure. Gramm's legislation, written with the help of financial industry lobbyists, essentially removed newfangled financial products called swaps from any regulation. Credit default swaps are basically insurance policies that cover the losses on investments, and they have been at the heart of the subprime meltdown because they have enabled large financial institutions to turn risky loans into risky securities that could be packaged and sold to other institutions.

[Jenny in Atl]

Sorry -- this was supposed to go under laylamcb's post. I agree with there being blame enough to go around.

 

I appreciated this article, because the mainstream media is sure not handing out primers on how we got here.

 

BTW, I disagree with the notion of "the poor banks" who *had* to lend. No, they took advantage of it. They tried to tell dh and I how much we could "afford", and it was nearly twice what we thought would be prudent, and we had good credit! In the meantime, if I were to try to sell my house now, I'd likely get $25-30K less than what we paid last summer.

Thank goodness I don't have to move.

 

 

 

 

Bingo... In my area there are tons of huge houses (600K- 1mil). Many of these folks got zero down or balloon loans and now foreclosures in GA are way up in these upper income areas. Flipping has also been very popular with investors buying homes with short term no money down loans, hoping to fix them up and sell for a profit before payments came due. Banks and mortgage brokers made a ton on these loans, selling them as soon as the closing ink dried. Oh the fees! The rates were dirt cheap and the credit was flowing.

 

I honestly believe the so-call section 8 folks buying homes they could not afford was a tiny percentage of this mess. And to say it's all the donkeys fault is hilarious. The Dems only got control of the congress a little under two years ago. It was a Republican controlled congress even under Clinton. Remember Newt? They all stink, Dems and Republicans alike. Finger pointing is the last thing we need. But, if it makes you feel better to look down your noise at others, just make sure there is no mirror near by.

[elegantlion]

I live in an area where the trend is to build new new new. The older parts of town, the houses in neighborhoods with yards, sidewalks, and other features which make them look like real neighborhoods are being left to decay. One reason they are decaying at such a rapid rate is because of so many people renting out the homes. Nice, large houses are being turned into boarding houses and are not well kept. The homes that people are buying have a nicely kept lawn, flowers in the flower boxes, etc. I think it should be EASIER for people to get loans to buy in these areas (providing their income has been verified and they can pay these loans back).

 

I totally agree. One needs only to watch a little bit of HGTV to see that people only seem to want the latest and greatest and complain because a bathroom or kitchen is outdated.

 

We used to live in an area where there were plenty of old two story homes full of character and unbelievable woodwork. Instead they would strip the homes and their qualities and leave the building to be demolished.

 

As to the original discussion, I'm more than a tad bitter about the whole situation. People have been having financial issues for years, companies had been warned. Some mortgage companies made it easy to get the loans but were never there to help the consumer understand the process in full and were not there to answer questions afterward, instead selling off their loan after closing. The whole things just stink, imo. There is enough blame to go around.

[Mrs Mungo]

Since you have your big kid pants on, I won't hesitate to inform you that Mike Reagan is more than a conservative columnist, he is a strategist who works for the Republican party and is the son of President Ronald Reagan. The same Ronald Reagan whose economic plan was called "voodoo economics" by the first President Bush. The same President Reagan whose economic plan had four pillars:

 

1. reduce the growth of government spending,
   
2. reduce marginal tax rates on income from labor and capital,
   
3. reduce government regulation of the economy,
   
4. control the money supply to reduce inflation.

The second President Bush was a big fan of Reaganomics as most of you may realize. Trickle down economics, cut taxes for the rich so they give to the poor, etc.

[Jenny in Atl]

Since you have your big kid pants on, I won't hesitate to inform you that Mike Reagan is more than a conservative columnist, he is a strategist who works for the Republican party and is the son of President Ronald Reagan. The same Ronald Reagan whose economic plan was called "voodoo economics" by the first President Bush. The same President Reagan whose economic plan had four pillars:

 

 

The second President Bush was a big fan of Reaganomics as most of you may realize. Trickle down economics, cut taxes for the rich so they give to the poor, etc.

 

And both Reagan and Bush have left us with huge deficits. It's one thing to cut taxes and deregulate in order to grow the economy, but when you spend every last penny of the profits and then some... it leaves all of us with one major hangover. :tongue_smilie:

[Lisa]

Good article. Thanks for sharing.

[RebeccaC]

It really is too bad that President Clinton signed away the depression era regs that would have kept this from happening. The idea of more home ownership in American sounded good but it sure has not played out well. It would have been nice if President Bush or McCain attemps to stop this would have gotten through the congress but OH well. Most of the folks in congress on both sides of the ilse were too busy being short sighted. It was nice that McCain saw ahead and tried to stop it to bad it didn't work. Wasn't Obama in the senate in when McCain tried to stop this...... Wonder how he voted on McCains bill. Think I'll try and find that bit of info and see if it sheds any more light on what he is saying now.

[Halftime Hope]

And both Reagan and Bush have left us with huge deficits. It's one thing to cut taxes and deregulate in order to grow the economy, but when you spend every last penny of the profits and then some... it leaves all of us with one major hangover. :tongue_smilie:

 

Agreed. That's one area in which I believe both parties have it wrong.

 

Is there no one in Washington who believes in fiscal responsibility? Sigh.

[Mrs Mungo]

It really is too bad that President Clinton signed away the depression era regs that would have kept this from happening.

 

You're kidding, right? President Clinton served as president from 1993-2001. The Republicans gained control of Congress in 1995. They continued to control Congress during most of President Bush's tenure. Blaming Clinton is a JOKE.

[Halftime Hope]

<snip> he is a strategist who works for the Republican party and is the son of President Ronald Reagan. <snip>

 

I know; I wasn't trying for a comprehensive list first thing this morning.

...

...

...

 

<<...President Reagan whose economic plan had four pillars:

 

1. reduce the growth of government spending,>>

 

Both parties have gone wrong in not following this pillar.

 

<<The second President Bush was a big fan of Reaganomics as most of you may realize. Trickle down economics, cut taxes for the rich so they give to the poor, etc.>>

 

That's an interesting take. I've never heard anyone say that trickle-down econ was so the rich could *give* to the poor. Now that's a novel idea! :)

 

 

 

Sincere thanks for your "other side of the issue" input, Mrs. Mungo.

[jubilee]

OK, is that really a name?! :smilielol5:

 

http://en.wikipedia.org/wiki/Jamie_Gorelick

[RebeccaC]

You're kidding, right? President Clinton served as president from 1993-2001. The Republicans gained control of Congress in 1995. They continued to control Congress during most of President Bush's tenure. Blaming Clinton is a JOKE.

 

 

No President Clinton signed the bill that did away with depression era regs in 99. As another Dem President often stated the Buck stops in the Oval Office. President Bush tried to turn it back and failed due to both parties and then McCain tried and failed again due to both parties.

 

Do your home work and you will see it was President Clinton's misguided desire to give home ownership to more folks in American that started this whole thing. Regs were brought down and signed by President Clinton and banking was loosened up so that his ideas could become reality. This will be in high school history books in 15 or 20 years. How Fannie and Freddie's present path were set in motion by the Clinton administration and how President Clinton signed away regs to make his idea of more home owners possible in America. Being near 50 I remember the debate at the time and I remember the signing away of the the regs.

 

Do a search for what the history behind this whole mess is. It will be quite eye opening. Not every thing in the world is Reagan and Bush's fault :001_smile:

[Jennifer in NH]

Good article, thanks...

[Mrs Mungo]

No President Clinton signed the bill that did away with depression era regs in 99. As another Dem President often stated the Buck stops in the Oval Office. President Bush tried to turn it back and failed due to both parties and then McCain tried and failed again due to both parties.

 

Do your home work and you will see it was President Clinton's misguided desire to give home ownership to more folks in American that started this whole thing. Regs were brought down and signed by President Clinton and banking was loosened up so that his ideas could become reality. This will be in high school history books in 15 or 20 years. How Fannie and Freddie's present path were set in motion by the Clinton administration and how President Clinton signed away regs to make his idea of more home owners possible in America. Being near 50 I remember the debate at the time and I remember the signing away of the the regs.

 

Do a search for what the history behind this whole mess is. It will be quite eye opening. Not every thing in the world is Reagan and Bush's fault :001_smile:

 

I've read quite a lot about the subject. I'm not putting the blame on Reagan, I'm saying to blame the Democrats is misleading *at best*.

[CLHCO]

Here is an interesting flashback from the L.A. Times, May of 1999. Get part way through the article and we'll get lots of yippies and good jobs for Fan and Fred, to President Clinton. Yes, congress was republican, but this one was his baby. He pushed for this as did the democrats.

 

There is plenty of blame to go around for the whole mess, but as for this particular issue, I don't buy that we get to land the blame equally on the republican congress. The republicans did not have a huge majority. Let's not forget that a very large number of those in congress were democrat at the time and stood behind this. I find it hard to believe that the democrats stood by helplessly as the republicans pushed through this mess, at least regarding Fannie and Freddie then hoodwinked Clinton into signing it. More likely, they manged to get enough republicans to agree to pass it through because it was the "nice thing to do" to make things fair and all. The democrats were happy to pat themselves on the backs for it back then and now they want to pretend they hold no blame in the short sightedness.

 

Forgive me if I don't get back on to check into how comments to this article play out. I'm borrowing my husband's computer because mine is broken and I was simply going through withdrawals when I happened by this thread. :tongue_smilie:

[Haiku]

No President Clinton signed the bill that did away with depression era regs in 99.

 

You mean Clinton did this all by himself? While the Republican Congress stood up in unison shouting, "No! Wait! Stop! This is Not A Good Thing!" And Clinton did it anyway?

 

Wow, I must have been asleep (or too young :confused:) when this all went down to not remember that part of it ... ;)

 

I was under the impression that this was a bipartisan act of idiocy.

 

Tara

[laylamcb]

I was under the impression that this was a bipartisan act of idiocy.

 

Tara

 

Bingo! :001_smile:

[RebeccaC]

I've read quite a lot about the subject. I'm not putting the blame on Reagan, I'm saying to blame the Democrats is misleading *at best*.

 

 

Well, I am not so sure that President Clinton signing away regs is misleading or a joke. It was his policy that started this mess and of course both parties are to blame but President Clinton had the last say and what president vetoes his own policy........ President Bush and Senator McCain both saw this coming and tried to stop it, neither man got much help from either party and so here we are.

 

I was fired up about the contract with America and for a very short season it lasted. My congressman, Speaker Hastert had a lot to do with Republicans going bad, they got drunk with power. I have often wondered if the republicans would have staid on line if Newt had not fallen, the contract with America was his idea and with out him they sure did tank.

 

As far as I am concerned both parties are corrupt but it was Clinton policies that got this bad ball rolling just as it was Clinton policies that help 9/11 along. Jamie Gorlick has her hands in both tragedies. It was she who created the wall to be more than it should be between the FBI and CIA, etc.... which helped lead to 9/11 and she was Vice Chairman of Federal National Mortgage Association (Fannie Mae) from 1997 to 2003. Seems like some one mentioned her in this thread....... and as it is she happens to be a Democrat. So I am not so sure blaming the dems is misleading........ both parties are at fault but ........ it was a Democratic President's policies and several democratic bureaucrats who headed up Franie and Freddie making millions and millions off of this whole mess..... it was Harry Reid a dem who said within the last week that they had no idea what to do.......

[Slartibartfast]

No President Clinton signed the bill that did away with depression era regs in 99. As another Dem President often stated the Buck stops in the Oval Office. President Bush tried to turn it back and failed due to both parties and then McCain tried and failed again due to both parties.

 

Do your home work and you will see it was President Clinton's misguided desire to give home ownership to more folks in American that started this whole thing. Regs were brought down and signed by President Clinton and banking was loosened up so that his ideas could become reality. This will be in high school history books in 15 or 20 years. How Fannie and Freddie's present path were set in motion by the Clinton administration and how President Clinton signed away regs to make his idea of more home owners possible in America. Being near 50 I remember the debate at the time and I remember the signing away of the the regs.

 

Do a search for what the history behind this whole mess is. It will be quite eye opening. Not every thing in the world is Reagan and Bush's fault :001_smile:

 

You mean that law that McCain supported?

 

McCain was asked if he regretted supporting a 1999 law that removed barriers between investment banks and commercial banks that were erected in 1933, in response to the 1929 stock market crash.

"No," McCain said. "I think the deregulation was probably helpful to the growth of our economy."

http://ap.google.com/article/ALeqM5htjyz7Bk_GOPn0uXonsBuSqkAE7gD93BDAH80

 

A decade ago, Sen. John McCain embraced legislation to broadly deregulate the banking and insurance industries, helping to sweep aside a thicket of rules established over decades in favor of a less restricted financial marketplace that proponents said would result in greater economic growth.

http://www.washingtonpost.com/wp-dyn/content/article/2008/09/16/AR2008091603732.html?hpid=topnews

 

"You are interviewing the greatest free trader you will ever interview, and the greatest deregulator you will ever interview."

http://blogs.wsj.com/dnotebook/2007/05/29/mccains-high-tech-cabinet/ (contains video)

 

 

"

I'm always for less regulation.

But I am aware of the view that there is a need for government oversight. I think we found this in the subprime lending crisis -- that there are people that game the system and if not outright broke the law, they certainly engaged in unethical conduct which made this problem worse. So I do believe that there is role for oversight.

 

 

"As far as a need for additional regulations are concerned, I think that depends on the legislative agenda and what the Congress does to some degree, but

I am a fundamentally a deregulator. I'd like to see a lot of the unnecessary government regulations eliminated, not just a moratorium

."

 

 

 

http://online.wsj.com/article/SB120431596193503527.html?mod=Leader-US

 

"I have a long voting record in support of deregulation," McCain said.

http://findarticles.com/p/articles/mi_qn4176/is_/ai_n14547240

 

 

MCCAIN: I am a deregulator. I believe in deregulation

http://transcripts.cnn.com/TRANSCRIPTS/0307/13/cnnitm.00.html

 

 

 

 

 

 

And in case you don't believe that..

 

 

here is video

 

 

http://www.youtube.com/watch?v=Q0a6aGa1CoE

 

 

http://www.youtube.com/watch?v=SpVir1EAcRc&feature=related

 

 

http://www.youtube.com/watch?v=0ycPJr7YWmQ&NR=1

 

Now, I am not trying to state that Republicans are responsible, I don't believe that but I am not going to sit idly by while John "Deregulator" McCain tries and paints himself as "pro-regulation" when he has been ANYTHING but.

[RebeccaC]

You mean that law that McCain supported?

 

Now, I am not trying to state that Republicans are responsible, I don't believe that but I am not going to sit idly by while John "Deregulatory" McCain tries and paints himself as "pro-regulation" when he has been ANYTHING but.

 

Even if McCain voted for the law it was a Democratic President's policy, was it not? It was a Democratic policy, Democratic bureaucrat's in charge of Freddie and Fannie that has gotten us where we are. McCain tried to fix this mess a few years ago once he saw how ill advised it was after President Bush tried, neither man succeeded. Folks often later see that they were wrong and it would appear that McCain did and tried to fix it.

 

I am not sure why you are responding to me as you are...... and yes I can read that you are not sitting idly by....:001_huh:..... I understand that you don't like McCain but..... point to one democrat who tried to fix this....... one in leadership who has an idea of how to fix this...... It was after all the a Democratic President, his policies, who deregulated and got this bad ball rollin.

 

So who is pro-regulation when it came to the economy? Was it the Dems? Was it the Republicans? For the most part no but it was Bush and in small part McCain in the 2000's.

[Slartibartfast]

Even if McCain voted for the law it was a Democratic President's policy, was it not? It was a Democratic policy, Democratic bureaucrat's in charge of Freddie and Fannie that has gotten us where we are. McCain tried to fix this mess a few years ago once he saw how ill advised it was after President Bush tried, neither man succeeded. Folks often later see that they were wrong and it would appear that McCain did and tried to fix it.

 

Please cite McCain and Bush trying to fix it as well as it was "Democrat Bureaucrats" that got us into this.

 

I am not sure why you are responding to me as you are...... and yes I can read that you are not sitting idly by....:001_huh:..... I understand that you don't like McCain but..... point to one democrat who tried to fix this....... one in leadership who has an idea of how to fix this...... It was after all the a Democratic President, his policies, who deregulated and got this bad ball rollin.

 

So who is pro-regulation when it came to the economy? Was it the Dems? Was it the Republicans? For the most part no but it was Bush and in small part McCain in the 2000's.

 

How am I responding? I wasn't being rude. :001_huh: I disagreed and offered several citations stating quite clearly McCain opposed regulation. I like to offer articles or other media to back my points. I do not engage in "Nuh UH!!" "Uh huh!!" type of discussion.

 

Who said I don't like McCain? I did like McCain when this campaign started and considered voting for him. He has since had serious ethical problems that I do not agree with and he lost my vote due to that.

[Alenee]

So...jumping off a cliff here.

 

Nobody is winning any argument here in this thread. One says, "It's not the Republican's fault, it's the dems!" And the other, vice versa. Do any of you realize that you sound just like "the other side" you so vehemently detest? We've had thread after thread talking about bi-partisanship, partisanship, hate, tolerance... This isn't a logical discussion anymore. It isn't changing our country's financial situation. It's purely a pointless thread now that has many of you all fired up at eachother for nothing.

 

From one who loves a good debate, take a :chillpill:.

[RebeccaC]

Please cite McCain and Bush trying to fix it as well as it was "Democrat Bureaucrats" that got us into this.

 

 

 

How am I responding? I wasn't being rude. :001_huh: I disagreed and offered several citations stating quite clearly McCain opposed regulation. I like to offer articles or other media to back my points. I do not engage in "Nuh UH!!" "Uh huh!!" type of discussion.

 

Who said I don't like McCain? I did like McCain when this campaign started and considered voting for him. He has since had serious ethical problems that I do not agree with and he lost my vote due to that.

 

Maybe I miss-read your post.....

 

As for Democratic bureaucrats we could start with Jamie Gorlick, since she has already been mentioned and made 10 million off of Frannie, or Democrat Jim Johnson who was on the team to vet Obama's vp.... I could list others if you really want.

 

Take a look at September 11 2003 New York Times article and President Bush then tried to fix this, I am not good at posting links so if you want it direct google it :001_smile: McCain tried something similar in 2005.

September 11, 2003

New Agency Proposed to Oversee Freddie Mac and Fannie Mae

By STEPHEN LABATON

The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

 

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

 

The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

 

The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac -- which together have issued more than $1.5 trillion in outstanding debt -- is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors, and critics have said Fannie Mae does not adequately hedge against rising interest rates.

 

''There is a general recognition that the supervisory system for housing-related government-sponsored enterprises neither has the tools, nor the stature, to deal effectively with the current size, complexity and importance of these enterprises,'' Treasury Secretary John W. Snow told the House Financial Services Committee in an appearance with Housing Secretary Mel Martinez, who also backed the plan.

 

Mr. Snow said that Congress should eliminate the power of the president to appoint directors to the companies, a sign that the administration is less concerned about the perks of patronage than it is about the potential political problems associated with any new difficulties arising at the companies.

 

The administration's proposal, which was endorsed in large part today by Fannie Mae and Freddie Mac, would not repeal the significant government subsidies granted to the two companies. And it does not alter the implicit guarantee that Washington will bail the companies out if they run into financial difficulty; that perception enables them to issue debt at significantly lower rates than their competitors. Nor would it remove the companies' exemptions from taxes and anti fraud provisions of federal securities laws.

 

The proposal is the opening act in one of the biggest and most significant lobbying battles of the Congressional session.

 

After the hearing, Representative Michael G. Oxley, chairman of the Financial Services Committee, and Senator Richard Shelby, chairman of the Senate Banking Committee, announced their intention to draft legislation based on the administration's proposal. Industry executives said Congress could complete action on legislation before leaving for recess in the fall.

 

''The current regulator does not have the tools, or the mandate, to adequately regulate these enterprises,'' Mr. Oxley said at the hearing. ''We have seen in recent months that mismanagement and questionable accounting practices went largely unnoticed by the Office of Federal Housing Enterprise Oversight,'' the independent agency that now regulates the companies.

 

''These irregularities, which have been going on for several years, should have been detected earlier by the regulator,'' he added.

 

The Office of Federal Housing Enterprise Oversight, which is part of the Department of Housing and Urban Development, was created by Congress in 1992 after the bailout of the savings and loan industry and concerns about regulation of Fannie Mae and Freddie Mac, which buy mortgages from lenders and repackage them as securities or hold them in their own portfolios.

 

At the time, the companies and their allies beat back efforts for tougher oversight by the Treasury Department, the Federal Deposit Insurance Corporation or the Federal Reserve. Supporters of the companies said efforts to regulate the lenders tightly under those agencies might diminish their ability to finance loans for lower-income families. This year, however, the chances of passing legislation to tighten the oversight are better than in the past.

 

Reflecting the changing political climate, both Fannie Mae and its leading rivals applauded the administration's package. The support from Fannie Mae came after a round of discussions between it and the administration and assurances from the Treasury that it would not seek to change the company's mission.

 

After those assurances, Franklin D. Raines, Fannie Mae's chief executive, endorsed the shift of regulatory oversight to the Treasury Department, as well as other elements of the plan.

 

''We welcome the administration's approach outlined today,'' Mr. Raines said. The company opposes some smaller elements of the package, like one that eliminates the authority of the president to appoint 5 of the company's 18 board members.

 

Company executives said that the company preferred having the president select some directors. The company is also likely to lobby against the efforts that give regulators too much authority to approve its products.

 

Freddie Mac, whose accounting is under investigation by the Securities and Exchange Commission and a United States attorney in Virginia, issued a statement calling the administration plan a ''responsible proposal.''

 

The stocks of Freddie Mac and Fannie Mae fell while the prices of their bonds generally rose. Shares of Freddie Mac fell $2.04, or 3.7 percent, to $53.40, while Fannie Mae was down $1.62, or 2.4 percent, to $66.74. The price of a Fannie Mae bond due in March 2013 rose to 97.337 from 96.525.Its yield fell to 4.726 percent from 4.835 percent on Tuesday.

 

Fannie Mae, which was previously known as the Federal National Mortgage Association, and Freddie Mac, which was the Federal Home Loan Mortgage Corporation, have been criticized by rivals for exerting too much influence over their regulators.

 

''The regulator has not only been outmanned, it has been outbid,'' said Representative Richard H. Baker, the Louisiana Republican who has proposed legislation similar to the administration proposal and who leads a subcommittee that oversees the companies. ''Being underfunded does not explain how a glowing report of Freddie's operations was released only hours before the managerial upheaval that followed. This is not world-class regulatory work.''

 

Significant details must still be worked out before Congress can approve a bill. Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.

 

''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''

 

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

 

''I don't see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,'' Mr. Watt said.

 

This of course never happened because of the House and the Senate which is too bad. All of those folks who have been in congress or the senate since 99 new there were problems with Fannie and Freddie and Not One of the them tried to doing anything about it with the exception of McCain...... This is a NT article so I don't know how accurate it is or how much liberal spin is in it..... but it shows that Bush was trying to do something in 2003 about this and McCain tried in 2005 google it and I am sure you will come up with more sorces.