The Enemy is at Home [Video]

[Denny Crane]

100 x ~$100,000 is on the order of $10M.

Even if it adds up to $1B, it's in the noise.

 

[RipCity]

I consider any waste of tax payer dollars as significant, however I fully understand that the bigger picture is much more disgusting.

 

[Denny Crane]

I think the real points to be made are the lack of good effect, and the massive debt/interest payments we're going to see from that kind of wasteful spending.

 

[deception]

I think the real points to be made are the lack of good effect, and the massive debt/interest payments we're going to see from that kind of wasteful spending.

u do realize that recession spending is a norm throughout the world even with a teabagger hall of famer like stephen harper as our pm north of the 49th? and to attach the appropriate context- this problem was aggravated by bush's military adventurism in mesopotamia and tax cuts that he could never justify. nevertheless, i wouldnt fret too much because the chinese are unwilling to float their yen and appear satisfied with the greenback. and europe might be experiencing another shock with their debt crisis.

 

[Denny Crane]

u do realize that recession spending is a norm throughout the world even with a teabagger hall of famer like stephen harper as our pm north of the 49th? and to attach the appropriate context- this problem was aggravated by bush's military adventurism in mesopotamia and tax cuts that he could never justify. nevertheless, i wouldnt fret too much because the chinese are unwilling to float their yen and appear satisfied with the greenback. and europe might be experiencing another shock with their debt crisis.

Dude,

I fully concur that republicans and Bush spent a lot and even ran up the debt overly so. However, at the time the democrats took over congress, gasoline was $2, unemployment was 5%, housing prices were stable, homes weren't forcelosed on like they are now, the banks were doing fine, etc.

And it was republicans like McCain and Bush who warned us about freddie mac and fannie mae, but democrats (and some republicans) opposed regulating them so there was nothing done.

Bush and McCain Proposed Oversight of Fannie Mae and Freddie Mac

Okay. Now somebody is not telling the whole story here. This September 17, 2008, article in the Washington Post, begins by stating this:

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.

It goes on to state:

In 2002, McCain introduced a bill to deregulate the broadband Internet market, warning that “the potential for government interference with market forces is not limited to federal regulation.” Three years earlier, McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.), who is now an economic adviser to his campaign. The Gramm-Leach-Bliley Act aimed to make the country’s financial institutions competitive by removing the Depression-era walls between banking, investment and insurance companies.

But there is no mention whatsoever of the following from the New York Times in September of 2003 and this is why the credibility of most of the media is at risk because they slant the story to say what they want it to say and not even try to give an overall truthful picture:

New Agency Proposed to Oversee Freddie Mac and Fannie Mae

By Stephen Labaton

September 11, 2003

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.

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.

And it is more than a little disturbing that there was no mention of John McCain’s words before congress in 2006:

Federal Housing Enterprise Regulatory Reform Act of 2005

The United States Senate May 25, 2006 Sen. John McCain [R-AZ]: Mr. President, this week Fannie Mae’s regulator reported that the company’s quarterly reports of profit growth over the past few years were “illusions deliberately and systematically created” by the company’s senior management, which resulted in a $10.6 billion accounting scandal. The Office of Federal Housing Enterprise Oversight’s report goes on to say that Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives. In the case of Franklin Raines, Fannie Mae’s former chief executive officer, OFHEO’s report shows that over half of Mr. Raines’ compensation for the 6 years through 2003 was directly tied to meeting earnings targets. The report of financial misconduct at Fannie Mae echoes the deeply troubling $5 billion profit restatement at Freddie Mac. The OFHEO report also states that Fannie Mae used its political power to lobby Congress in an effort to interfere with the regulator’s examination of the company’s accounting problems. This report comes some weeks after Freddie Mac paid a record $3.8 million fine in a settlement with the Federal Election Commission and restated lobbying disclosure reports from 2004 to 2005. These are entities that have demonstrated over and over again that they are deeply in need of reform.

For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay. I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. 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. I urge my colleagues to support swift action on this GSE reform legislation.

The Democrats killed this measure in Committee preventing the full Senate Vote.

 

[Denny Crane]

And this is obviously interesting for those who understand the emperor wears no clothes:

http://www.opensecrets.org/news/2008/07/top-senate-recipients-of-fanni.html

Fannie Mae and Freddie Mac Invest in Democrats

Published by Lindsay Renick Mayer on July 16, 2008 5:27 PM | Permalink | Comments (27)

(For an updated chart that includes contributions from Freddie Mac and Fannie Mae's PACs and employees to ALL lawmakers back to 1989, including to their leadership PACs, go here.) and data The federal government recently announced that it will come to the rescue of Freddie Mac and Fannie Mae, two embattled mortgage buyers that for years have pursued a lobbying strategy to get lawmakers on their side. Both companies have poured money into lobbying and campaign contributions to federal candidates, parties and committees as a general tactic, but they've also directed those contributions strategically. In the 2006 election cycle, Fannie Mae was giving 53 percent of its total $1.3 million in contributions to Republicans, who controlled Congress at that time. This cycle, with Democrats in control, they've reversed course, giving the party 56 percent of their total $1.1 million in contributions. Similarly, Freddie Mac has given 53 percent of its $555,700 in contributions to Democrats this cycle, compared to the 44 percent it gave during 2006.

Fannie Mae and Freddie Mac have also strategically given more contributions to lawmakers currently sitting on committees that primarily regulate their industry. Fifteen of the 25 lawmakers who have received the most from the two companies combined since the 1990 election sit on either the House Financial Services Committee; the Senate Banking, Housing & Urban Affairs Committee; or the Senate Finance Committee. The others have seats on the powerful Appropriations or Ways & Means committees, are members of the congressional leadership or have run for president. Sen. Chris Dodd (D-Conn.), chairman of the Senate banking committee, has received the most from Fannie and Freddie's PACs and employees ($133,900 since 1989). Rep. Paul Kanjorski (D-Pa.) has received $65,500. Kanjorski chairs the House Financial Services Subcommittee on Capital Markets, Insurance and Government-Sponsored Enterprises, and Freddie Mac and Fannie Mae are government-sponsored enterprises, or GSEs.

Top Recipients of Fannie Mae and Freddie Mac
Campaign Contributions, 1989-2008

Rank Name Office Party/State Total
1. Dodd, Christopher J S D-CT $133,900
2. Kerry, John S D-MA $111,000
3. Obama, Barack S D-IL $105,849
4. Clinton, Hillary S D-NY $75,550
5. Kanjorski, Paul E H D-PA $65,500

 

[deception]

Dude,

I fully concur that republicans and Bush spent a lot and even ran up the debt overly so. However, at the time the democrats took over congress, gasoline was $2, unemployment was 5%, housing prices were stable, homes weren't forcelosed on like they are now, the banks were doing fine, etc.

u do realize that he inherited a 1.3 trillion dollar deficit; 2 wars he had to pay for and the worse economic crisis since the fdr days. and the data suggests a halt: the jobs created, saved and lost numbers are the best since 2007 or prior to the crisis- i think the hemorrhaging has stopped. and if your genuinely concerned about cutting the deficit- i would suspect that u would favour a health care overhaul because that's the largest contributor to the deficit and maybe u might also favour an estate tax as well- both of which the republicans fiercely oppose. and lets not forgot that the president did institute a budget freeze and early on he pledged that he would halve the deficit- so he's actually listening to u guys on the right. thats a departure from his predecessor who only listened to two men: dick cheney and jesus.

the interesting thing about your analysis is that u seem to look at your country in a vacuum but the world is a lot more integrated than u might think and the entire world is hurting.

and a lot of things are said on the campaign trail but lets look at mccain's inner circle:
http://motherjones.com/mojo/2008/09/mccains-fannie-and-freddie-connections

Aquiles Suarez, listed as an economic adviser to the McCain campaign in a July 2007 McCain press release, was formerly the director of government and industry relations for Fannie Mae. The Senate Lobbying Database says Suarez oversaw the lending giant's $47,510,000 lobbying campaign from 2003 to 2006.

And other current McCain campaign staffers were the lobbyists receiving shares of that money. According to the Senate Lobbying Database, the lobbying firm of Charlie Black, one of McCain's top aides, made at least $820,000 working for Freddie Mac from 1999 to 2004. The McCain campaign's vice-chair Wayne Berman and its congressional liaison John Green made $1.14 million working on behalf of Fannie Mae for lobbying firm Ogilvy Government Relations. Green made an additional $180,000 from Freddie Mac. Arther B. Culvahouse Jr., the VP vetter who helped John McCain select Sarah Palin, earned $80,000 from Fannie Mae in 2003 and 2004, while working for lobbying and law firm O'Melveny & Myers LLP. In addition, Politico reports that at least 20 McCain fundraisers have lobbied for Fannie Mae and Freddie Mac, pocketing at least $12.3 million over the last nine years.

For years McCain campaign manager Rick Davis was head of the Homeownership Alliance, a lobbying association that included Fannie Mae, Freddie Mac, real estate agents, homebuilders, and non-profits. According to Politico, the organization opposed congressional attempts at regulation of Fannie and Freddie, along the lines of what John McCain is currently proposing. In his capacity of president of the group, Davis went on record in 2003 and insisted that no further reform of the lenders was necessary, in contradiction to his current boss's sentiments. "[Fannie and Freddie] are subject to an innovative and stringent risk-based capital stress test," Davis wrote. "The toughest in the financial services industry."

 

[Denny Crane]

u do realize that he inherited a 1.3 trillion dollar deficit; 2 wars he had to pay for and the worse economic crisis since the fdr days. and the data suggests a halt: the jobs created, saved and lost numbers are the best since 2007 or prior to the crisis- i think the hemorrhaging has stopped. and if your genuinely concerned about cutting the deficit- i would suspect that u would favour a health care overhaul because that's the largest contributor to the deficit and maybe u might also favour an estate tax as well- both of which the republicans fiercely oppose. and lets not forgot that the president did institute a budget freeze and early on he pledged that he would halve the deficit- so he's actually listening to u guys on the right. thats a departure from his predecessor who only listened to two men: dick cheney and jesus.

the interesting thing about your analysis is that u seem to look at your country in a vacuum but the world is a lot more integrated than u might think and the entire world is hurting.

and a lot of things are said on the campaign trail but lets look at mccain's inner circle:
http://motherjones.com/mojo/2008/09/mccains-fannie-and-freddie-connections

He didn't inherit a $1.3T deficit, he inherited a $450B deficit.

Every president in recent memory inherited an economy in decline, but Obama, and especially his advisor Rahm Emanuel, made it worse and prolonged it for the sake of "never let a good crisis go to waste." Though the times were worse in 1980 after a similar president to Obama (Carter) finished his only term.

If there are 100 total jobs in the economy and 99 or 100 are lost, the hemorrhaging stops! Amazing how that works.

Health care is not the largest contributor to the deficit. People not having jobs and thus not paying taxes is a huge contributor to the deficits.

There is no budget freeze, that's just horse shit. The budget has increased from $3T to $3.6T to close to $4T (the $3T being Bush's last and overly large budget).

 

[deception]

He didn't inherit a $1.3T deficit, he inherited a $450B deficit.

i think u're being a little disingenuous or reading to much drudge report because every independent organization has confirmed that number. and btw- bush jr inherited a fairly robust economy. although, the same couldnt be said for bush sr and clinton.

http://politicalticker.blogs.cnn.co...e-deficit-under-republicans/?fbid=EUNKAX0A9YU

Obama was essentially correct when he said he inherited a budget deficit of $1.3 trillion. Though the budget deficit for 2008 was a then-record $458.6 billion, the CBO issued a projection in January 2009, just days before Obama took office that the budget deficit would reach $1.2 trillion that year, before the cost of any new stimulus plan or other legislation was taken into account.

 

[deception]

Health care is not the largest contributor to the deficit. People not having jobs and thus not paying taxes is a huge contributor to the deficits.

off the top of my head- u guys spend something like 17 or 18% of your gdp on health care and that is by far your largest expenditure. and if your so concerned about tax collection- why dont u just tax high income earners to make up for any shortfalls in unemployment?

 

[RipCity]

off the top of my head- u guys spend something like 17 or 18% of your gdp on health care and that is by far your largest expenditure. and if your so concerned about tax collection- why dont u just tax high income earners to make up for any shortfalls in unemployment?

Because taxing high income earners simply does not work. The people in our nation who fall into that tax bracket are mostly business owners, and they are not going to personally take the hit from higher taxes. They will pass their increased costs right down to consumers.

Secondly, there is no justifiable reason why someone who earns more money should be taxed more. At that rate you are punishing success and taking a massive shit on the American dream.

 

[Denny Crane]

i think u're being a little disingenuous or reading to much drudge report because every independent organization has confirmed that number. and btw- bush jr inherited a fairly robust economy. although, the same couldnt be said for bush sr and clinton.

http://politicalticker.blogs.cnn.co...e-deficit-under-republicans/?fbid=EUNKAX0A9YU

He inherited a deficit of $458B, like I said.

Bush inherited a recession and a massive stock market crash.

 

[Denny Crane]

off the top of my head- u guys spend something like 17 or 18% of your gdp on health care and that is by far your largest expenditure. and if your so concerned about tax collection- why dont u just tax high income earners to make up for any shortfalls in unemployment?

We don't spend 17% or 18% of our GDP on health care. We spend on insurance, which is not at all the same thing. It's because government policies have created a bogus and not-free market for the product. When the consumer has to pay for insurance, like auto insurance, I see the insurance companies advertising they can save you money if you switch to their coverage. A free market would mean we'd see them advertising the same sorts of things for catastrophic health coverage, too.

 

[deception]

He inherited a deficit of $458B, like I said.

Bush inherited a recession and a massive stock market crash.

massive stock market crash? recession? the it bubble burst and the tigr economy collapsed, thats it. if u lived in south korea or japan or even seattle- maybe u should complain because their entire economy burst into flames but u dont.

and the cbo as well as independent news organizations have verified the presidents assertion.

 

[deception]

We don't spend 17% or 18% of our GDP on health care. We spend on insurance, which is not at all the same thing. It's because government policies have created a bogus and not-free market for the product. When the consumer has to pay for insurance, like auto insurance, I see the insurance companies advertising they can save you money if you switch to their coverage. A free market would mean we'd see them advertising the same sorts of things for catastrophic health coverage, too.

insurance companies dont care about competition, no, there only concern is risk minimization. i know- i work for them indirectly as a broker.

 

[Denny Crane]

massive stock market crash? recession? the it bubble burst and the tigr economy collapsed, thats it. if u lived in south korea or japan or even seattle- maybe u should complain because their entire economy burst into flames but u dont.

and the cbo as well as independent news organizations have verified the presidents assertion.

NASDAQ in 2000:

Investors (which was ordinary people) lost several $trillion in wealth.

 

[Denny Crane]

insurance companies dont care about competition, no, there only concern is risk minimization. i know- i work for them indirectly as a broker.

D'oh!

[video=youtube;1aZLw_KBdqc]

 

[deception]

NASDAQ in 2000:

Investors (which was ordinary people) lost several $trillion in wealth.

it was the a bubble and it burst. ppl made speculative risks and they lost big.

 

[Denny Crane]

it was the a bubble and it burst. ppl made speculative risks and they lost big.

And Bush inherited an economy in really bad shape.

I thought at the time it didn't matter if Bush or Gore won that we might have another great depression.

 

[deception]

insurance companies dont care about competition, no, there only concern is risk minimization. i know- i work for them indirectly as a broker.

let me clarify the risk minimization comment for everyone. ill use car insurance as an example: by law in canada every qualified driver is entitled to insurance. however, certain companies will price themselves so prohibitively high for certain types of drivers e.g. male drivers under 25- that it wouldnt make sense to purchase insurance from that particular company and thats legitimate. moreover, insurance companies let it be known informally that they discourage certain kinds of risk e.g. certain geographical areas, new drivers, ppl with a claims history, etc. so sometimes i have this awkward scenario where the best quote might originate from company X but i know that company would get all pissy with me if i binded the risk on their behalf so i quote them company Y instead, even though it might be $1000 more expensive.

 

[deception]

We don't spend 17% or 18% of our GDP on health care. We spend on insurance, which is not at all the same thing. It's because government policies have created a bogus and not-free market for the product.

http://www.nytimes.com/2010/03/12/opinion/12krugman.html?src=me&ref=general

Well, if having the government regulate and subsidize health insurance is a “takeover,” that takeover happened long ago. Medicare, Medicaid, and other government programs already pay for almost half of American health care, while private insurance pays for barely more than a third (the rest is mostly out-of-pocket expenses). And the great bulk of that private insurance is provided via employee plans, which are both subsidized with tax exemptions and tightly regulated.