Bush: A Socialist

Michael Koppelman

Reports the BBC:

US President George W Bush has defended a rescue package to tackle the worst financial markets crisis for decades.
…
Mr Bush said the measures required the US “to put a significant amount of taxpayer dollars on the line…But I’m convinced that this bold approach will cost American families far less than the alternative,” he said.

When times are good the profiteers on Wall St. reap the benefits. When times are bad, instead of letting market forces adjust, all the rich folks suddenly become socialists. The government must step in with billions!

The real alternative, Mr. Bush, was tighter regulations to prevent this sort of catastrophe in the first place!

Bush: A Socialist

7 thoughts on “Bush: A Socialist”

  1. nope.
    what troubles me is that you have no clue how the legislature works. they did not have a filibuster proof majority and nothing happens without the consent of both parties. notice how the dems won’t vote for the rescue plan even thought they know they have the votes? why don’t they just pass it? your dem leadership and bush are on the same side of this one, how does that happen?

    watch this, you might learn something (but i doubt it).

    so even though the dems are in contropl now, i’m guessing you think everything bad that happens is because of the repubs?

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  2. Gee, Micadelic, in 2005 the White House and Congress were both controlled by the Republicans. It’s amazing how you guys can blame the inaction of a Republican-controlled Congress on the Democratic minority! Truly amazing. Even when Republicans are in control, every bad thing that happens is because of the Democrats.

    Doesn’t that logic ever trouble you?

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  3. Please read this, you might learn something…

    How the Democrats Created the Financial Crisis: Kevin Hassett
    By Kevin Hassett

    The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.

    Fannie and Freddie did this by becoming a key enabler of the mortgage crisis. They fueled Wall Street’s efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.

    In the times that Fannie and Freddie couldn’t make the market, they became the market. Over the years, it added up to an enormous obligation. As of last June, Fannie alone owned or guaranteed more than $388 billion in high-risk mortgage investments. …

    The problem was that the trillions of dollars in play were only low-risk investments if real estate prices continued to rise. Once they began to fall, the entire house of cards came down with them. Take away Fannie and Freddie, or regulate them more wisely, and it’s hard to imagine how these highly liquid markets would ever have emerged. This whole mess would never have happened.

    It is easy to identify the historical turning point that marked the beginning of the end.

    Back in 2005, Fannie and Freddie were, after years of dominating Washington, on the ropes. They were enmeshed in accounting scandals that led to turnover at the top. At one telling moment in late 2004, captured in an article by my American Enterprise Institute colleague Peter Wallison, the Securities and Exchange Commission’s chief accountant told disgraced Fannie Mae chief Franklin Raines that Fannie’s position on the relevant accounting issue was not even “on the page” of allowable interpretations.

    Then legislative momentum emerged for an attempt to create a “world-class regulator” that would oversee the pair more like banks, imposing strict requirements on their ability to take excessive risks. Politicians who previously had associated themselves proudly with the two accounting miscreants were less eager to be associated with them. The time was ripe.

    The clear gravity of the situation pushed the legislation forward. Some might say the current mess couldn’t be foreseen, yet in 2005 Alan Greenspan told Congress how urgent it was for it to act in the clearest possible terms: If Fannie and Freddie “continue to grow, continue to have the low capital that they have, continue to engage in the dynamic hedging of their portfolios, which they need to do for interest rate risk aversion, they potentially create ever-growing potential systemic risk down the road,” he said. “We are placing the total financial system of the future at a substantial risk.”

    What happened next was extraordinary. For the first time in history, a serious Fannie and Freddie reform bill was passed by the Senate Banking Committee. The bill gave a regulator power to crack down, and would have required the companies to eliminate their investments in risky assets.

    If that bill had become law, then the world today would be different. In 2005, 2006 and 2007, a blizzard of terrible mortgage paper fluttered out of the Fannie and Freddie clouds, burying many of our oldest and most venerable institutions. Without their checkbooks keeping the market liquid and buying up excess supply, the market would likely have not existed.

    But the bill didn’t become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn’t even get the Senate to vote on the matter. We now know that many of the senators who protected Fannie and Freddie, including Barack Obama, Hillary Clinton and Christopher Dodd, have received mind-boggling levels of financial support from them over the years.

    Throughout his political career, Obama has gotten more than $125,000 in campaign contributions from employees and political action committees of Fannie Mae and Freddie Mac, second only to Dodd, the Senate Banking Committee chairman, who received more than $165,000. …

    There has been a lot of talk about who is to blame for this crisis. A look back at the story of 2005 makes the answer pretty clear.

    Oh, and there is one little footnote to the story that’s worth keeping in mind while Democrats point fingers between now and Nov. 4: Senator John McCain was one of the three cosponsors of S.190, the bill that would have averted this mess.

    Barack sure has a lot more of that Fannie/Freddy dough in his coffers then Johnny Mac. How you gonna ‘splain that away?

    But your right, Bush does have his socialist tendencies. I hate that about him. But from everything I’ve read this rescue by the Fed is the only way out.

    Peace. 😉

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  4. I don’t agree with the notion that markets run best when entirely unregulated. The rich and powerful write the rules to their favor and the markets are not really free anymore after a while. I don’t understand the libertarian view that somehow the little guy is going to do just as well as the rich powerful guy in unregulated markets. The rich and powerful have a long, long history of fucking us over.

    Right now, though, we have the worst of all worlds, the rich fuck us in good times and get billion dollar handouts in bad times. It’s bullshit, but I agree with Nader more than Ron Paul on the solution.

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  5. imagine says:

    The Peoples Republic of Wall Street has a trillion dollar check from the citizens of the United States. Chairman of the SEC states that there is still “no guarantee” that this will work.
    Fast acting was needed to stem the panic. I commend the admin. for acting fast. The coming weeks and months will tell if this was a prudent move as no one has a clue as to what they are buying for that trillion dollars.

    Bonehead comment of the week was when McCain stated just a few short days ago that the US economy was in ‘good shape’.

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  6. I would say “yes” to your observation. These people are obviously not capitalists. However I would say your solution sounds wrong.

    I’m not exactly sure what kinds of regulations you had in mind but…

    1. If we try to regulate ethical behavior those regulations will always fail.
    2. If we try to regulate people from making stupid mistakes those regulations will always fail.

    Having such regulations creates an environment where people are encouraged to be unethical and stupid. Then when they start reaping what they have been sowing they run to the government asking to get bailed out because the government was supposed to protect them from their unethical behavior and stupid decisions.

    So, if you are suggesting regulations that do not fit into either of those two categories, you might have a good idea, but if you do not, I think you are trying to fix a problem with more of what caused it in the first place.

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