Frightful, in that our so-called elected officials have finally unmasked themselves for the inept cowardly buffoons they truly are, and outraged that “we” the American people tolerate these phony ideologues on both sides of the political aisle.
Watching President Bush, trying to explain the unraveling of the “American Dream”, and the $700 billion bail out, one couldn’t help but wonder, “where the hell was he”, for the last eight years? The outrage I felt, watching this pathetic display of a once forceful leader, distressed me, and I’m sure countless Americans across the nation, felt betrayed.
However, President Bush isn’t the only inept politician in this melodrama; there are others that deserve equal, if not more condemnation, and perhaps a quick history lesson is in order, to put all of this into perspective.
For over 55-years the banking industry was tightly regulated, then in November 1999 under then President Clinton, all that changed, with the repeal of the Glass-Steagall Act, which prevented banks from investing in high-risk Wall Street investments, President Clinton set into motion the beginnings of what we’re now facing. With restrictions eliminated, banks and other leading institutions began buying up and merging with investment banks, swapping assets, creating new loan "instruments" and thus weakening both independent systems.
Of course, the Clinton Administration didn’t stop there, within that same year Clinton appointed Franklin Delano Raines, the CEO, of Fannie Mae giant GSE (Government Sponsored Enterprise), which had been "privatized" and listed on the New York Stock Exchange. Under Raines, the Clinton Administration began lobbying Congress for less regulation and more "flexibility".
Soon a once sound and stable financial institution gave way to radical government intervention and social engineering, the likes of which has never been seen. Within a few short years, thousands upon thousands of home loans were written for marginal and low-income buyers, who traditionally would not have qualified for a home loan. Many lenders simply lent money without any verification as to income or the ability to repay the loans.
Deregulation also set into motion quick “get rich” scams by speculators, who saw an opportunity to pounce into the real estate market, purchase “investment homes”, with no income verification and with little or no money down, and “flip” those homes for a sizeable profit.
This financial feeding frenzy went unabated for years and was actually encouraged by the likes of Senator Chuck Schumer, and Rep. Barney Frank, who still heads up the House Financial Services Committee -- which has key oversight over both Fannie Mae and Freddy Mac.
While all this reckless borrowing and risky speculation was going on, the federal agencies that should have been overseeing this situation were nowhere to be found. Incredibly, the same players (Schumer and Frank), are now on Capital Hill trying to stem this financial crisis.
Of course, there were warning signs of the impending doom, that apparently no one took serious, in the spring of 2001, the Bush Administration had warned that both Fannie Mae and Freddie Mac was “a potential problem” that could “cause strong repercussions in the financial markets”. Then Treasury Secretary John Snow, in 2002, again called for “a strong, world class regulatory agency to oversee the prudential operations of both Fannie Mae and Freddie Mac", and once again echoed this dooms day forecast.
Rather then, heed the warnings of the Administration; Rep. Barney Frank along with Senator Schumer ridiculed the alarm, suggesting that the agencies “are not in crises” and declared that the Bush Administration “exaggerates a threat of safety and soundness” and Frank actually encouraged both agencies to continue providing mortgagees for low-income families.
Of course, not be out done with this “progressive ideology”, Senator Schumer declared that, “Fannie and Freddy over the years have done an incredibly good job…of making America the best housed people in the world”.
Enough of the history lesson, obviously, we’re in the worse financial crises since the “Great Depression”, and we need to solve the problem quickly. However the likes of Barney Frank, Chuck Schumer, the Congress, President Clinton and Bush, need to know like the CEO’s of those bankrupt firms, they will be held accountable.
They all deserve our condemnation, for allowing partisan politics, and ineptness to override the safety and security of this great land. Incredibly, what the terrorists of 9/11 couldn’t accomplish (the destruction of our financial institutions), these inept cowardly buffoons are.
However, our concern should be what transpires next? Obviously, the next president will be presiding over a fragile economy, and in that realization, he must be a caretaker of this economy. He must pledge NOT to raise taxes on anyone, and must reduce wasteful spending, immediately.
Of course, Senator Obama, much like Senator Schumer and Rep. Barney Frank, function on the far left of the political spectrum. They believe in big government, and massive social programs.
The challenge for Obama, (in light of the current financial crises), is have the discipline to curb his instinct for spending and his grand vision for America, and simply stay the course, without driving this economy into a depression...a tall order of a tax and spend liberal.