The Bush Administration is pushing through one of the biggest scams ever foisted on the American taxpayer. The $700 Billion “bailout plan” is little more than welfare for Wall Street Investment Banks and Hedge Funds. It is an aid package for the Crack Addicts of speculation and leverage. The plan goes way beyond the home mortgage market and rescues rich people and businesses from their own bad decisions.
In the past several weeks the U.S. taxpayer has already bailed out Bear Sterns, Fannie Mae, Freddie Mac, and AIG – to the tune of hundreds of BILLIONS of dollars. And to what end? An ever collapsing market for speculative investment banks. These are not regular banks but the Captains of Greed. In fact several of the largest traditional banks are still making a NET PROFIT, among them Wells Fargo, Bank of America, and JP Morgan Chase. In fact these banks will still loan you money to buy a house if, surprise, you have income, good credit, and some money to put down. Imagine that!
There is no crisis in the regular economy where you produce something that the market place wants or needs. Certainly the regular economy is slow but not in crisis. What is in crisis is the world of hedge funds and corporate rip-off artists, where you suck 10s of millions from companies for producing NOTHNG! These companies and people do NOT deserve a bailout.
Please contact your Representative and Senators and tell them to say no to a bailout for the Robber Barons of the 21st Century.
District 1 – Rick Renzi
District 2 – Trent Franks
District 3 – John Shadegg
District 4 – Ed Pastor
District 5 – Harry Mitchell
District 6 – Jeff Flake
District 7 – Raul Grijalva
District 8 – Gabrielle Giffords
One problem with the $700 bailout program is that there is no guarantee that it will solve anything. The other problem is that the U.S. Government cannot afford the tab. The national debt is already above 10 Trillion dollars. The last thing we need to do is add another trillion dollars to the tab. This bailout plan will not only transfer bad debt – it will move the eventual bankruptcy from private firms to the U.S. Government.
I see Sonoran Alliance is taking a firm stand in the closing of barn doors after the horses have left.
Now you care about debt? Now you care about corporate welfare? Want me to order you up some Che Guevera hats and “Buck Fush” t-shirts?
So Klute, are you for the bailout, against it, or just being snaky?
Have you called Gabby yet and told her to vote no on hedge fund welfare?
NOW do you see WHY I say RINOs and moderates are the death of our party? In fact, they’re the death of this NATION. Can ANYBODY tell me how this bailout is small government or free market? Or WHY they nominated Bush as opposed to some of the more conservative alternatives? Or WHY we’ve nominated McLame rather than Fred Thompson or Ron Paul? Thanks to moderate scum, we’re on the hook for another $700 billion in junk assets, we’re $10 TRILLION in debt, we’re running deficits, we have a looming crisis in entitlement spending and we’ll be looking at either draconian cuts to spending (I can only PRAY this is the choice we make!) OR soclialistic tax rates. THANKS, Bush! Thanks, McLame! Thanks RINOs! Thanks moderates! You guys ROCK!
Moderates and RINOs should all be tried as enemies of the state, found guilty, and executed. They’ve economically ruined this country from the inside. They’ve accomplished what the Soviets, the Nazis and Imperial Japan couldn’t do: defeat us. I’m so angry right now I can’t see straight.
Antifederalist – You are claiming Bush is a RINO? The same Bush that has been so embraced by the base of the party. Maybe this is the actual Republican Party and you should think about finding a new party (like LIbertarian).
At first blush, I’m a’gin it, but to be honest, I haven’t read up on all the details (the last two weeks I’ve been travelling to shows between Albuquerque and Fremont, NE).
Unfortunately, from what I’ve read of the debate itself, we’re being told that it’s this or Great Depression II: Electric Boogaloo, so it’s going to pass regardless, lest anyone look indecisive in an election year.
And I’m CD-5, so it’s actually Harry Mitchell, although Schwiekert’s HQ is down the street from me, maybe I should go over there and deliver my message personally (and steal some pens).
“Or WHY they nominated Bush as opposed to some of the more conservative alternatives?”
Because everyone just wanted to have a beer with him, Antifederalist! He lived on a ranch and drove a pickup truck! He said Jesus was his favorite philospher! He pressed all the right buttons, and y’all went for him hook, line, and sinker.
Antifederalist, I am not much of a McCain fan but he has a fairly credible record opposing out of control deficits. Hopefully McCain will communicate his record more clearly on the issue and do something to address the deficit once in office.
Josey, you forgot to mention the Trilateral Commission the Council of Foreign Relations and the CIA plot for 911.
Boneheads like you with a minimal understanding of business fundamentals just cant accept that there are things like credit markets that make our economy work. I am not saying that this whole crisis isnt bad, it is almost a freaking financial apocolypse. And the big corp failures on wall street were driven by traders that were making money on short sales (betting on a down side market) and destroyed Lehmans and all the rest. Did you notice they went 1 by 1 and not all at once? Thats because traders concentrated on each one and then the rest of the vultures piled on and made it an unnatural market. Capitalism does involve some amount of responsibility. What they did was akin to taking a life insurance policy out on a neighbor, and then putting arsenic in his water so you could collect on the policy.
But seriously, watch that screaming Cramer guy on cable or something,so you can learn about the market and how wall street affects main street. And just try to have a more intelligent conspiracy theory.
Bush tried to fix Fannie and Freddie back in 2003, which is at the root of the mortgage mess. Of course the Dems and a handfull of liberal Republicans opposed it (just like Social Security). Now the system is crashing. We got to bite the bullet and fix it. The alternative is worse.
every country that started printing money out of thin air has had their economy crash.
end the fed!
Todd,
Yer darned right I’m telling you and everyone else that Bush is a RINO. Have you been paying attention to the last 8 years? Need I spell it out for you? OK, since you seem to be news-deprived: Bush has accumulated MORE debt than ALL Presidents put together all the way up to Reagan. Can you tell me, Todd, how that’s adhering to fiscal responsibility, a Republican Party principle? How is No Child Left Behind a small government, strict constructionist program? Republicans are supposed to be the party of small governmnet, right? How is the LARGEST entitlement program in HISTORY, the prescription drug benefit, small government? Have you bothered to read the Bush Treasury’s blueprint for financial industry reform? Well, let me inform you that the RINO Bush wants to NATIONALIZE the regulation of the entire financial industry. Can you tell me, Todd, how that adheres to the principles federalism enshrined in Article 1 and the Tenth Amendment? And Republicans claim to honor the constitutin, right? Well, Todd, if that’s not enough proof for you that Bush is a RINO, I’ll come back and bash you over the head with more evidence until it sinks in: Bush is without a doubt a RINO scumbag. You cannot HONESTLY argue otherwise. If you do, you’re a kool-aid drinker and a party tool.
And, I really don’t care whether or not the cattle low praises at Bush. Need I remind you that our Foundes were NOT fans of democracy? That’s why they handed us a REPUBLIC. We’d serve this country WELL by returning to a limited franchise like we had at this country’s founding to weed out all the idiots from having a say in who our leaders are. With the unlimited franchise, we end up with leaders like Bush, McLame, and all the clowns in Congress. Let me ask, Jeff, if lemmings are jumping off a cliff, should I follow? If the unwashed masses are proclaiming NObama the savior of all mankind, should I vote for the communist? By your argument, because idiots embrace Bush, I should unthikingly embrace him too as a Republican. What a lame argument you’ve made. You’ve gotta come up with better kung fu than that, hombre.
This brings me to Klute (I’ll refrain from hanging him with a certain title I know he loathes because I agree with him on this point). I maintain that the old Jacksonian vs. Hamiltonian analysis is still VERY alive and well when it comes to politics. Bush DID look like the everyman as compared to Republican hopefuls. Bush also looked far more Jacksonian than the Hamiltonian Kerry. To prove my assertion, I can, and will work this analysis back several elections with respect to Presidential politics. Despite this analysis that gives insight as to who will win an election, it doesn’t mean that the winner is the best choice.
Josie,
I’ve heard that McLame is supposedly for smaller budgets and against pork-barrel spending…however, I’ve read in the past that he’s brough home plenty of pork to Arizona. I haven’t looked at his voting record on this issue, but it would be EASY to look up, but I’d wager that McLame has NEVER (or almost never) voted against a Budget Resolution or a single appropriations bill. Nevertheless, I remind you that McLame was involved in the Keating 5 scandal…and I maintain that he’s STILL saying his mea culpas by setting himself against “special interests”, whether those interests seek pork or other influence, as proof that he’s clean on the issue. I don’t buy his charade.
Antifederalist – my point is that perhaps Bush (and Reagan, BTW) is a perfect example of the Republican party, a party that claims it will do one thing and then invariably does the opposite.
Josey, you wrote, “One problem with the $700 bailout program is that there is no guarantee that it will solve anything.”
This weekend, Senator Kyl said this was a “Temporary” (his word) solution to this problem. Kyl has already said that the guarantee anyone is looking for isn’t worthless than the paper it is written on.
Maximus reveals his own lack of understanding by blaming short sellers. This is total scapegoating.
This story started a few weeks ago as a 200 B bailout, then a 500 B bailout, now it is a 700 B bailout, and now I am reading stories that it will cost $1.2 T –
Hold onto your hats, folks, this ride ain’t over for a long time…
Maximus, I understand markets quite well. I am not sure how you drifted off to the conspiracy side. What I had to say is fact.
When considering markets you must agree that deficits cannot grow forever, especially at the rate of the last 7 years. Too Big to Fail has become Too Expensive to Rescue.
There is another important economic rule that you are forgetting. Don’t throw good money after bad. The traditional banks are going to make it. The real threat is from Wall Street Investment Banks and Hedge Funds. I contend that their debts and obligations are mostly worthless. One house of cards stacked upon another, default credit swaps on top of each other, some leveraged 60 to 1. There is nothing there to bail out. It is all rot.
Liquidity….how do you maintain it so that the Wells, B of A and Chase have a source to loan from?
DCW’s had a huge role but the outcome remains the same regardless of the why and how….
So how do you restore and retain liquidity in all markets?
Using trillions of dollars of taxpayer money to purchase illusory short-term security, the government is actually ensuring even greater instability in the financial system in the long term.
Kim, those 3 banks will attract capital because they know how to correctly use it. If well run banks get in a short-term bind then maybe the government should help them, not the firms that destroy capital.
It is all up to McCain. If he votes yes, the Democrats and many Republicans will go along. If McCain votes no, the Democrats will not go along.
Many liberal Democrats are just as upset about the bailout as many conservative Republicans, perhaps for some different reasons, but also for some of the same reasons: unfettered authority for the treasury secretary, lack of accountability, the moral hazard that is obvious, rewarding Wall Street gamblers at the expense of Main Street regular people.
If it is a socialist plan, then why is our one socialist U.S. senator, Bernard Sanders of Vermont, opposed to the bailout? This opposition isn’t entirely ideological.
On the other hand, failure to pass the bailout could cause the credit markets to seize up totally. Already today Bank of America refused a loan to McDonald’s. It’s hard to get car loans or mortgages. If no one can sell cars, for example, thousands more auto workers will be laid off. At least that is what we are told…
After reading all the articles in today’s Wall Street Journal and New York Times and Forbes and Business Week and I don’t know what to think.
Josey,
All the traditional banks played this game at some point. They may not have given sub-prime loans, but they participated in the “creative” bundling of those mortgages as they went up the line to Wall street. If there is no bailout, the credit markets freeze, for everybody, including the big banks.
Democrat talking points right now are that Republicans (Bush, McCain, Gramm) caused crisis because they have supported deregulation. This is a bunch of hooey! The crisis was caused by the greed of homebuyers getting in over their heads, and the greed of finance gurus that created the cbo’s and other consolidation tricks to bundle mortgages on a large scale and hide the bad loans. Lots of people thought they were getting something for nothing and now we all are on the hook.
Maximus,
It started well before greed. The government made the financial environment for greed very attractive. First, the leftists in Congress have been pushing the communist goal of housing for everyone for quite some time now. Second, in the New Deal and the `70′s, the leftists set up Fannie and Freddie to get mortgages off the books of banks so they could continue to make more and more mortgages. This puts great demand pressures on the housing market, artifically driving home prices up. This is how bubbles are created. Additionally, the idiot Greenspan kept interest rates artifically low to drive lending even harder. When Clinton got into office, Fannie and Freddie started buying junk mortgages, encouraging the origination of junk loans because banks knew they could get them off their books and lend again. So, now the fairy tale that housing prices will always go up, fueled in part by the idea that lefists would never give up on their goal of a house for everyone, has been shown to be false. Despite obvious flaws in left-wing-created distortions in the housing market, they’re STILL at it, trying to get the uncreditworthy poor into homes.
So, Max, as always, it’s the GOVERNMENT’s fault. They encouraged the housing bubble and greed. The answer is to get government OUT of the housing market altogether, because al they do is distort the market and create asset bubbles.
Antifederalist – problem with you theory is that Community Reinvestment Act, the program that seeks to get mortgages for low-income borrowers, were actually less likely to be foreclosed on than other mortgage loans and were only a small share of foreclosed loans
http://www.traigerlaw.com/publications/traiger_hinckley_llp_cra_foreclosure_study_1-7-08.pdf
I would also add that the housing for everyone has not been just a goal of leftists but of many on the right as well, as a population that owns property is likely to act quite different than one that does not.
We are know finding out that the FBI has been conducting an investigation of massive fraud on Wall Street. How about we put the blame were it belongs, on the people who created this environment by deregulation and wanton disregard for public good.
Todd,
That’s just a pitifully weak argument. Banks can get CRA credit for a lot more than just making loans to low-income individuals. Banks only worry about CRA credit when it’s time for a regulator to pour over their books. Banks get graded on their CRA performance. Those laons made for CRA credit are only a small portion of the mortgage market as a whole, as is admitted by the report. The problem lies, as Bernanke’s quote states, with the originate-to-distribute model. A model championed by government and the Government-Sponsored Enterprises Fannie & Freddie. That is where the government had the greatest hand in creating the housing asset bubble and it’s collapse. I remind you that the GOVERNMENT sets what Fannie and Freddie’s conforming loans look like, and as is typical with incompetent government, they failed to write sound underwriting standards and still allowed originators to get bad loans off their books. The government eroded sound underwriting…now as is typical of liberals, the government has created a problem with regulation, now they want MORE regulation to fix the problem they started in the first place. It’s best for them to just stay out of our business because they ALWAYS create a mess.
Antifederalist – the government gives mortgage interest deductions – is that “interfering with the market?” Would the larger financial industry even exist without federal deposit insurance and SEC oversight – no. I agree the government is at fault as well, but it doesn’t come down to big bad liberals using government to ruin markets, it is that the companies and their allies in government rigged things to serve their interests with toss-all to the rest of us. Now that the private profits have been made, they want to socialize the losses. Blaming it all on government just backs their excuse.
Todd, a case could be made that the mortgage deduction actually is a distortion. I believe that some versions of the Flat Tax would do away with all deductions. Either way it is useless for most families because of the large size of the Standard Deduction. I do not deduct my sizable interest payments because the Standard Deduction is much larger and you cannot take both.
Josey – I guess the point is, what does the government do that does not distort the market? Like massive military spending, or charging or not charging tariffs or many other things that people would not even think about. I just am not sure where this market free of government distortion could exist. So the real arguments are actually about who the distortions help or hurt. I know it is dogma around here to believe it would be desirable, but I doubt most people would want to live that way even if it were.
Todd,
Military spending, setting tariffs, and control over interstate commerce are all powers delegated to Congress. Meddling in the mortgage market is not. I agree with Josey. By giving tax breaks, Congress IS trying to engineer the economy. In this case, they’ve failed so badly that they’ve frozen our credit markets. And TBH, the Founders gave us a REPUBLIC to insulate the country from what the masses want. Whether they like it or not, the USG should stick to ONLY what’s in the consitution and that’s it. If they don’t like it, there’s an amendment process. However, the unthinking masses quite often want what they want when they want it no matter what the constitution says. That’s why democracy and the rule of law are mutually exclusive. The masses are incapable of disciplined thinking…that’s why we have Democrats, and RINOs, and moderates, and neo-cons.
Antifederalist – arguing about “intrusion” is one thing, claiming it is being done by liberals is another. Both sides want to meddle with the market – if our think the GOP doesn’t your way off. I would add that just because the constitution allows something doesn’t mean it isn’t an intrusion with the market. The free market and the US Constitution are two separate sets of ideas.
BTW, I find your highly elitist opinion about the masses and your opinion about the constitution quite interesting considering you handle as “antifederalist.” Antifederalists were opposed to the constitution and wanted more direct democracy.
Great Post, this stuff really is the next wave of the future.
Is there a way to become a content writer for the site?
I wish there was an easier choice for this.