Several people have sent me this very well written article published on Hot Air (*). While everything written is factually correct, there is quite a bit missing that would give voters a better perspective. Therefore, I’m going to add the missing pieces to this article since it is vitally important that people vote INFORMED this election. Before I delve into this, I will disclose a few “disclaimers” with the hope to avert subsequent commentary based on false interpretations of my position and purpose of writing this article.
First, this article is not being written to bash George W. Bush or lay blame solely on him for the current economic situation. The following is being written with the intent to better inform people and demonstrate the danger of putting establishment Republicans back in power.
Second, it is important to note that the “genius” idea of “affordable housing” is solely attributed to leftists. This was the Democrats’ baby from day one; however, it got by with “a little help from their friends” on the other side of the aisle.
Lastly, I am not in any way suggesting that people vote third party, or that a third party is the solution. I have never nor will I ever devote myself to ANY political party. What I am suggesting is to NOT vote the STATUS QUO. If you live in a district that has a solid Republican running (i.e. a Meg Whitman, a Pat Toomey, a Rand Paul); then by all means, vote for that candidate! Sadly for me, Illinois is one of the most corrupt states in the union run by a strong political machine; and there is clearly no difference between Democrats and Republicans. Both parties have run this state into the ground, and the Republican establishment has done an excellent job keeping candidates who are serious about shrinking government off the ballot. Therefore, I will be voting straight Libertarian until I have viable option, or when candidates with a libertarian view can successfully infiltrate the Republican Party.
Now that my position is clear, let’s get into the task at hand…
The first section on Andrew Cuomo, the current New York gubernatorial candidate, is spot on. In a nutshell, leftists had a dream of giving everyone a home, regardless of whether or not they could actually afford it; and they would get taxpayers and the Federal Reserve to finance this dream. Cuomo did play a major role in expanding the power of Fannie Mae and Freddie Mac. (Perhaps his opponent, Carl Paladino, should focus on bringing this issue to light instead of making absurd statements about homosexuals.) The comment Paul Krugman made was also a nice touch to illustrate the insanity of these policies and his ineptness as an economist.
In the next part of the article where props were given to the Bush Administration is where we run into a problem. While it’s true that President Bush and some Republicans tried to pull back the reins on Fannie Mae and Freddie Mac; these attempts were pathetic, misguided and very half-hearted. Why? The answer is that it was very difficult for President Bush to reverse his position after he spent the first two years of his presidency touting these very policies. Need proof? Let’s take a walk down memory lane, shall we?
The following video is part of a speech Bush gave way back in October of 2002. He addressed the gap between Black and Hispanic home ownership relative to overall home ownership. He was proud to announce that Fannie Mae and Freddie Mac will address the “shortage of capital” needed to close this gap and that a low-income home buyer could have “just as nice of a house as anyone else!” Of course, taxpayers will finance all of this, which he alludes to in the next clip.
The first clip, “Video One,” was not one of Will Ferrell’s better impersonations on Saturday Night Live; but for those who doubt that George Bush would actually say what he did, I’ve taken the liberty of finding clips of him in the flesh…
“Video Two” was a speech given by Bush on May 17, 2002. In this video, he talks about not one but TWO government entitlement programs designed to assist people in buying a home they cannot afford. The first was the “American Dream Down Payment Fund” where he actually admits that this program will be funded by the taxpayers! Even the most devout leftists know better than to say that directly! The second was the “Single Family Affordable Housing Tax Credit,” whereby each state received a $1.75 per capita in tax credit dollars in 2002, with an index for inflation. This, of course, was yet another misguided government program designed to encourage real estate developers to build in economically distressed areas.
If that wasn’t bad enough, he talked about the importance of the role of the federal government to provide affordable housing. His intention was to get a “sustained commitment” from the private sector. How was that achieved? That’s where Fannie Mae and Freddie Mac came into play. The idea was to expand capital by having the government put a stamp of approval and guarantee reckless lending. Banks loaned money recklessly because the government guaranteed their idiocy!
If you are getting indigestion, I recommend you stop the video because your stomach won’t be able to take the last part of the clip. Don’t say I didn’t warn you. Not only does he foolishly imply that the federal government empowers people, he goes on to say that we must “use the mighty muscle of the federal government along with state and local governments” to encourage home ownership! I honestly don’t think one would hear that come out of Barack Obama’s mouth. The MIGHTY MUSCLE of the federal government?? Why in the world did the left despise this man? They should have embraced him!
I never took it personally when I was called an “economic charlatan” by a former graduate school professor, as “Video Three” demonstrated the prominent line of thinking at the time. It was very obvious that my opinion would be considered daft, especially when I voiced it long before 2007.
Here we have the Bush Administration, who by this time tried umpteen times to “rein in” Fannie Mae and Freddie Mac, denying the impending economic disaster. At this point in time, it was obvious to many prominent classical liberal economists the magnitude of the disaster that was coming our way. The problem is Bush already slept with the left on this issue. The Democrats, namely Chris Dodd and Barney Frank, who sat on the congressional financial committees, were indeed blocking any attempts for reform. However, Bush couldn’t take it a step further because he was treading on dangerous ground in the sense where he had to “180” his position and admit that the policies he flaunted were going to be responsible for a major economic meltdown. That’s political suicide, especially when the left would jump all over him for reneging on his word to help minorities; and leftists knew very well who they can blame (and still blame) when things came crashing down. Due to the fact that Bush was worried about the post-911 economy, he thought inflating investment in the housing market was the way to go. When it became obvious that disaster was looming, what was his answer? More REGULATION and more government expansion, as the next video illustrates. Oh how that works so well. I wonder if he idolized Herbert Hoover because his legacy is that of a modern day Hoover.
Now, it is time for the grand finale. Please stay with me my Republican cheerleaders! It really is for your own good that we travel backward in time.
“Video Four” takes us to late 2007, where Bush still believes that the fundamentals of the nation’s economy are sound. In the meantime, our dollar is worth less than a roll of toilet paper, gas prices are shooting through the roof and inflation is everywhere. The man still had the audacity to suggest that the subprime market was “innovative.” He cited the problem with adjustable-rate mortgage (ARMS) rates rising, but he didn’t give the real reason why ARMS rates were rising – INFLATION. I also wonder just where Americans got that “overly optimistic assumption” regarding the performance of the housing market.
He then proceeds to demonize those “irresponsible lenders,” who were only playing by the rules the government laid out for them – the very rules he advocated during the first few years of his presidency. On top of that, he has the arrogance to ask lenders to renegotiate the terms of these loans so they could hold paper with sub-par rates of return, which only leads to future economic turmoil. This is certainly not a sympathy vote for the lenders, as they should have moved beyond their short-sighted view of temporary government security. That will cause your demise every time.
The real kicker here is when he clearly stated that it is not the job of the federal government to bail out the lenders and investment houses. Interestingly enough, one year later, he came on national TV and said we had to “abandon the free market to save it.” He ended up signing into law one of the largest financial bailouts on record.
In the latter half of his speech, he talked about more government programs to combat the crisis – specifically “FHA-Secure.” It is important to note that all this program did was keep the prices of homes inflated; and worse, moved MORE people into federally backed loans. Further expanding the role and influence of the government in the housing market was Bush’s answer when it should have been the opposite. So much for reining in the role of government sponsored enterprises! They should have been ABOLISHED.
All I ask of everyone who reads this column is to HONESTLY answer the following questions:
• Can you see President Obama giving these same speeches, and are the positions exactly the same? Do you understand that Obama has simply expanded on these very same policies?
• Are you confident that establishment Republicans will rail against reckless government spending and the current Obama agenda? Have you read the GOP Pledge to America?
• Are you able to now see how establishment Republicans have laid the groundwork for the current economic state?
• Will you admit to the danger of blind partisan voting?
The latter question is probably the most important, as it is ultimately responsible for the current tyrannical government.
Once again, the purpose of this column was not a Bush-bashing session. I am also aware that George W. Bush is not on the ballot this coming election; BUT the establishment Republicans, some who played a role in helping the leftists in this country achieve their dream, ARE on the ballot! For your own sake and for the future of this country, do not vote blindly this election.
Leftists cannot enact their agenda in this country without help, and the Republican establishment gave them plenty of help all through Bush’s eight years. Government interference in the housing market goes all the way back to FDR. The Carter administration resurrected and expanded the role of government in the housing market; and it was former members of the Clinton Administration (all mentioned in the Hot Air article), that are directly responsible for sowing the seeds of the current economic meltdown. It is very true that Democrats were the masterminds of a scandal that would make Bernie Madoff envious; but the beauty of it all for the left was that they had a staunch ally in George W. Bush to keep those dreams alive. They also had a perfect scapegoat to blame when it all came crashing down. Let’s not re-elect more scapegoats.
How many people believe that these policies were solely Republican? The left has done an excellent job in indoctrinating people into believing this foolish nonsense. Note some of the commentary on the videos. However, Republicans are just as guilty for going along with the plan. What ideology does the Republican establishment stand for? We just saw a Republican President talk about the “MIGHTY MUSCLE” of the federal government! With rhetoric like that, why fear Obama? After seeing these clips and understanding the history, one can only conclude that A) establishment Republicans are clueless stooges or B) their ideology is a less extreme form of socialism. Neither sits well with me, and it should be a grave concern for American citizens that all we have is a choice between social engineering of varying degrees. It is important to understand that every economic meltdown that has occurred over the past century has been a result of government social engineering and market steering gone bad.
For all who think that a Republican takeover of Congress is all that is needed to stop the Obama agenda in its tracks had better wake up and smell the coffee and brush up on history. Until we as a nation come to grips with the fact that government will not solve wealth inequality (it will only contribute to it), right social wrongs, pad our retirements and cure all of our ills, government will only work to erode what little liberties we have left. Until people stop falling for these populist tactics and get educated, brace yourself for more of the same.
Please vote INFORMED this election…
Ayn Rand, Capitalism - At Amazon, Ayn Rand, *Capitalism: The Unknown Ideal * (Mass Market Paperback).
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