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Barack Obama refers to "failed Bush-McCain policies" so often that I think he may have a kind of Bush Tourette's Syndrome. No matter what the issue is, Obama blames Bush and his separated-at-birth twin brother John McCain. Yesterday's e-mail from the Obama campaign was no different:
For eight years, Bush-McCain economic policies have favored reckless deregulation and huge tax loopholes for big corporations. Now, as these corporations crumble, American taxpayers are facing costly bailouts. More of the same failed ideas are not going to solve our economic problems. I'm calling for a $1,000 tax break for middle-class families -- not just because they need help dealing with the rising costs of gas, food, and health care, but also because our economy needs to be reinvigorated from the bottom up, not the top down. I'm proposing a second stimulus package to save over one million jobs and provide immediate relief to struggling families. And I'll end the "anything goes" culture on Wall Street with real regulation. We can see clearly that our economy is stronger when we protect investments and pensions, and avoid devastating bankruptcies and bailouts.
But what are these "failed Bush-McCain economic policies" that have "favored reckless deregulation" ???
Bush Administration Press Secretary Dana Perino also wants to know. Here's an exchange she had with reporters yesterday following Bush's statements about the economic situation:
REPORTER: Well, I want to give you a chance to respond to what Speaker Pelosi is saying [Pelosi blamed Bush for the mortgage crisis, while exoneration Democrats], because it really seems like the -- at least the sort of finger-pointing is ratcheting up, accusing Republicans, and it sounded like the White House, of mismanagement of financial-market regulation. It really seems as though there's a accusation that the White House is to blame in some way, or the Bush administration policy is to blame in some way. Your response?
PERINO: Well, unfortunately -- unfortunately, I don't think that the reaction of finger-pointing from Democrats to the White House is anything new. I would ask you to go back and look and ask Speaker Pelosi or any of the other Democrats who are pointing fingers, what specific regulation did they want that we blocked? What specific regulation did we eliminate? In fact, it was the White House that worked to try to get them to act on GSE reform as early as 2003. Unfortunately, they did not act on that until most recently when there was a crisis and we got the authorities that we needed in August of 2007. What we were looking for in that GSE reform was a strong regulator. That's what we wanted. It was more regulation, more transparency, and a stronger independent regulator who could actually look at the books of the GSEs, Fannie Mae and Freddie Mac, and tell us exactly what was going on. In addition to that, we wanted FHA modernization so that more low-income people could have their mortgages backed by the FHA. They didn't move on that until there was a crisis at hand. We wanted rules -- they're called RESPA rules, I can't remember what it stands for, it's Real Estate Settlement Act -- but it would help people understand what they're getting into when they have a loan. Unfortunately they didn't act on that. Hank Paulson's regulatory blueprint that he laid out early last spring fell on deaf ears to the Democratic members of Congress.
As I discussed in my last post, the Bush administration only attempted to REGULATE the financial industry. It proposed no deregulation. John McCain also attempted to regulate Fannie Mae and Freddie Mac in 2005. Democrats united to shoot down all those measures.
The U.S. Constitution empowers Congress with controlling monetary matters. Regulation of the financial industry must go through Congress. President Bush can't do it. Can anyone point me to any regulation that Democrats proposed prior to the mortgage crisis ? Anyone ? Inquiring minds want to know.
When Barack Obama, Nancy Pelosi, and pretty much all the rest of the Democrats blame the mortgage crisis entirely on Republican deregulation, they dishonestly ignore their own involvement. The last significant deregulation of the financial industry, the Gramm-Leach-Bliley act, which has been pointed to as a significant contributing factor to the subprime crisis, occurred in 1999 and was signed into law by Democatic president Bill Clinton. Gramm-Leach-Bliley passed the Senate by a vote of 90-8, so it had wide bipartisan approval. Obama's VP nominee, Joe Biden, voted for it, as did nearly the entire Democratic leadership. John McCain did not vote on the final version of that legislation. The Democrats hailed the passage of Gramm-Leach-Bliley at the time, saying that it would significantly boost the availability of low-income housing. It certainly did that. Unfortunately, we've since discovered that low-income people often can't afford expensive housing, so may of those loans are in default.
I ask you - had Barack Obama been in the Senate in 1999, how do you think he would have voted on a measure to boost low-income housing ? This is the Barack Obama who has been ranked as the most liberal Senator by the National Journal, the Barack Obama who votes with the Democratic leadership an astounding 97% of the time (so much for him being a "new kind of politician who works across party lines". The guy who really does that is John McCain). Is there ANY doubt that Obama would have voted in favor of that legislation ? I certainly think he would have.
Obama also favors a second stimulus package, that will only add more to the national debt, because it's not paid for. Is this what we need after the pols in D.C. have put taxpayers on the hook for hundreds of billions of dollars in bailouts, with god only knows how much more to come ? No, it's precisely what we don't need. It is nothing but a further abandonment of responsibility, designed solely to get votes in november by pandering to the public.
Thus far, I've heard no real ideas from our politicians for solving this crisis, outside of maybe Ron Paul (that's the guy the other GOP presidential candidates thought was a mere curious oddity during the primary debates). The rest have their heads buried in the sand. All those bad loans held by the bailed out companies are still bad loans. There has been no reckoning. The only way bad debt is resolved is thru liquidation. Little of that is occurring. Our politicians are taking every measure possible to avoid that reckoning, which is only going to lengthen the mortgage crisis and cost the taxpayers a bundle in the process.