THE DOUBLE TALKING DONKEY
With superb rhetorics and media-backed double talk, the Obama-led Democratic presidential campaign has been zeroing in on economic issues and putting the blame squarely on Bush and the Republicans. With the everyday American feeling the sting of this solely sub-prime triggered crisis, the Democrats are cashing in on the ordinary citizen's misery and exploiting the situation to their advantage by finger-pointing Bush. But what is really the truth about this crippling financial crisis we are all experiencing now? Is Bush really to be blamed for all the suffering every American is encountering now-a-days, and for this reason junk the Republican's candidate McCain?
A factual and revealing editorial by the Investor's Business Daily entitled "America's Second Wake-up Call (http://ibdeditorials.com/IBDArticles.aspx?id=308530236252361) cited the following documented events leading to the current financial crisis we are presently experiencing:
• April 2001: The Bush administration's fiscal budget stated that the size of Fannie and Freddie was "potential problem because financial trouble of a large Government-Sponsored Enterprise could cause repercussions in financial markets, affecting federally insured entities and economic activity."
• May 2002: The Office of Management and Budget wanted disclosure and governance principles in Bush's 10-point plan for corporate responsibility to apply to Fannie and Freddie.
• February 2003: A federal housing oversight report warned that unexpected problems at Fannie Mae could immediately spread into financial sectors.
• September 2003: Treasury Secretary John Snow, in testimony to the House Financial Services Committee, recommended that Congress enact legislation to create new agency to regulate and supervise financial activities of housing-related government entities to set prudent and appropriate minimum capital requirements.
Rep. Frank, the committee's ranking member, strongly disagreed, saying: "Fannie Mae and Freddie Mac are not facing any kind of financial crisis . . . . The more people exaggerate these problems, the more pressure there is on these companies, the less we'll see in terms of affordable housing."
• February 2004: The president's new budget again highlighted risks of the explosive growth of these government enterprises and the then-low levels of required capital. It also called for the creation of a world class regulator. The administration determined that housing regulators of government agencies lacked the power and stature to meet their responsibilities and should be replaced with a strong new third regulator.
• February 2004: Greg Mankiw, chairman of Bush's Council of Economic Advisers, cautioned Congress against taking the strength of financial markets for granted. He too called for reducing the risk by ensuring that housing GSEs are overseen by an effective regulator.
• April 2004: Rep. Frank ignored warnings, accusing the administration of creating an "artificial issue." "People pay their mortgages," he told a group of mortgage bankers. "I don't think we are in any remote danger here. This focus on receivership, I think, is intended to create fears that aren't there."
From 2004 to 2008 the Bush administration made 12 more attempts to get Congress to pass legislation to have safer, sounder regulatory oversight of Fannie and Freddie and capital rules. You can see them for yourself on the White House Web site. But here are a couple of examples that show how Democrats resisted:
• July 2005: Senate Majority Leader Harry Reid rejected legislation on reforming Fannie and Freddie. "While I favor improving oversight by our federal housing regulators to ensure safety and soundness, we cannot pass legislation that would limit Americans from owning homes and harm our economy in the process," he said.
• August 2007: Sen. Dodd, another Democrat, ignored President Bush's emphatic calls for Congress to pass Fannie and Freddie reform legislation and called for him to immediately reconsider his ill-advised position.
The Democrats have conveniently swept under the rugs the fact that the very roots of this current financial crisis were the new regulations mandated by Clinton in 1995!
"In 1995, President Clinton mandated new regulations that coerced banks to make significantly more subprime loans to inner-city residents previously viewed as unqualified buyers in high-risk areas. Banks were rated on how well they complied and faced big fines if they didn't do what government regulators wanted." (-IBD Editorial)
Wake up America! The economic woes crippling us today is in truth and in fact the unintended result of a Democrat-initiated and Democrat-supported program which allowed Freddie and Fannie to undertake their anything-goes lending activities.
And who profited from all these but the Democrats led by Barney Frank, Chris Dodd, and Barack Obama who defended these two agencies to the hilt while receiving sizeable political donations from them.
Political double-talk? .... The whole Democrat presidential campaign is a classic!