Senate Dems Push Conflicting Messages on McCain
From ABC’s Z. Byron Wolf on Capitol Hill:
Democrats are straddling two, conflicting arguments in their criticism of Sen. John McCain on the economy. With one foot, they’re kicking forward the notion that McCain is a new Herbert Hoover, deluded and talking about a strong economy even as the stock market crumbled. At the same time, they’re telling Americans there’s not depression in the offing and "Don’t panic."
On the Senate floor this morning, the Majority Leader Harry Reid, D-Nev., launched into a lengthy analogy comparing McCain, who Democrats have pounced on for yesterday saying the fundamentals of the US economy are sound, to Herbert Hoover, the Republican President who oversaw the stock market crash in 1929 and the advent of the Great Depression.
"On the morning of October 30, 1929, President Herbert Hoover awoke the day after the biggest one-day stock market crash in American history, surveyed the state of the U.S. economy and declared, "The fundamental business of the country, that is production and distribution of commodities, is on a sound and prosperous basis," said Reid, quoting Hoover.
He went on: "In the coming weeks and months, President Hoover remained in an economic bubble, unaware of the extreme suffering of ordinary Americans — even declaring that anyone who questioned the state of the economy was a "fool." For Herbert Hoover, ignorance was bliss. And it wasn’t until the American people replaced this out of touch Republican president with a Democrat, Franklin Roosevelt, that our nation’s economic recovery began."
Reid, ticked off the woes on Wall Street, "With our financial markets reeling, the American people are wondering whether they will lose their jobs, whether they will be able to pay their child’s next tuition bill, whether their pension and retirement savings will be safe."
But this is a slippery slope. A Pandora’s box. A cat in a bag. If the economy is truly unsound, what’s a taxpaying voter with a 401k and a stock portfolio to do? Panic?
It may be fine to compare McCain (fairly or not… he did clarify his "fundamentals are sound" comment repeatedly over the past day) to Hoover, but Democrats don’t want a run on the skittish market either.
So Reid dialed things back.
"There is no reason to think we are headed into an economic depression," Reid said. "There is no reason to panic. Yet one Senator — John McCain — woke up yesterday morning, surveyed the state of the U.S. economy, summoned the ghost of his fellow Republican, Herbert Hoover, and declared, "The fundamentals of our economy are strong."
Question – if there is truly no reason to think we are headed into an economic depression and truly no reason to panic, aren’t the fundamentals, on some level, strong?
– Z. Byron Wolf
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Harry Reid isn’t exactly on top of things. Is he. I’m not sure he’s even alive. He’s definitely a major reason that this congress is called a ‘do nothing’ congress.
And, he’s truly hateful and bitter!
Posted by: dl | September 16, 2008, 12:17 pm 12:17 pm
Harry Reid is an idiot and a wimp.
He has already stated “I can’t stand John McCain”.
Another famous Reid quote – “Oil makes on sick, sick, sick.”
Well I can’t stand Harry Reid and he makes me sick, sick, sick.
Pelosi and Reid are the very worst leaders there every were in Congress.
Posted by: susie | September 16, 2008, 12:18 pm 12:18 pm
I think McCain is modest. When he said economy is not his strongest suit, he compared with himself. His ‘national security’ maybe the strongest, then ‘economy’. He was NOT comparing with Obama. No matter what, his ‘economy’ is still stronger than Obama. Obama is not strong in anything.
Posted by: golfgirlusa | September 16, 2008, 12:21 pm 12:21 pm
the last line is a false dichotomy. the “fundamentals of our economy” can be something less than strong without it meaning that we are going to be in a full-fledged depression. i don’t think the economic picture is nearly so black-and-white.
Posted by: x | September 16, 2008, 12:22 pm 12:22 pm
Your hard-earned tax dollars at work, America……………
No wonder this Congress has done nothing!!!
Instead of spending their time working on a solution to a problem, they would rather spend their time playing the blame game right on the floor of the U.S. Senate………..
Posted by: SandyB | September 16, 2008, 12:26 pm 12:26 pm
for 6 long years the republicans have led us to this, and during the last two they continued to push their agendas… and now they blame all their bs on the last two years as if the last 6 dont matter
its time for a change in the right direction….
obama!!!!
Posted by: Bhrandon | September 16, 2008, 12:26 pm 12:26 pm
Obama/Pelosi/Biden/Reid 08 is this change?
Posted by: Kitty | September 16, 2008, 12:27 pm 12:27 pm
jpt writes:
“Question – if there is truly no reason to think we are headed into an economic depression and truly no reason to panic, aren’t the fundamentals, on some level, strong?”
Posted by: Belle Starr | September 16, 2008, 12:32 pm 12:32 pm
I am a little more concerned about the conflicting messages John McCain is sending about himself and our economy.
“Our economic fundamentals are sound vs.
we are in a crisis that needs probing by a commission like the 9/11 attack.”
The Bush tax cuts were against his principles but are now OK. Immigration reform was needed vs. throw them out.
With all due respect ABC. two identical posts on Harry Reid’s “contradictions” vs. none on McCain?
Posted by: ricky | September 16, 2008, 12:36 pm 12:36 pm
Bhrandon, the Democrats controlled the Senate during the first 2 years of President Bush’s first term.
Posted by: James Danley | September 16, 2008, 12:43 pm 12:43 pm
It must be noted that Herbert Hoover was a sitting President. Senator McCain is no Herbert Hoover, and Barack Obama is no FDR.
Posted by: John | September 16, 2008, 12:43 pm 12:43 pm
Yes, the FUNDAMENTALS of our economy are strong. Let’s DEMAND TO KNOW what caused this dreadful thing to happen. Let’s don’t panic. We held in after 9/11 and things recovered. We can do it again!!
Harry Reid is total sleaze..Ask folks in Las Vegas about Harry Reid.
Posted by: MEW | September 16, 2008, 12:45 pm 12:45 pm
Senater Dodd and Senater Obama are the 2 largest recepients of campaign cash from Freddia Mac and Fannie. I agree with Senater McCain that an investigation into these companies and their ties to congress should begin. Also the energy bill being considered in congress contains no royalties going to the states were offshore drilling is being considered unlike Alaska. Nancy Pelosi is responsible for the exclusion of royalties to these states because she knows the states will never agree to drilling if they have no stake in the revenues. The Dems “stink like 3 day old fish” when it comes to governent fraud along with the Repubs.
Posted by: Jim | September 16, 2008, 12:45 pm 12:45 pm
Sandy…
Got to admit you are right on this one:
Instead of spending their time working on a solution to a problem, they would rather spend their time playing the blame game right on the floor of the U.S. Senate………..
But you also need someone who can “kick butt” and that ain’t John M.
Posted by: thetruth | September 16, 2008, 12:53 pm 12:53 pm
Jim…can you reference where you got this info?
Senater Dodd and Senater Obama are the 2 largest recepients of campaign cash from Freddia Mac and Fannie.
Posted by: thoughtful | September 16, 2008, 12:54 pm 12:54 pm
Concernd…why do you suppose he said that( if he really did)?
Posted by: formerhillary | September 16, 2008, 12:56 pm 12:56 pm
“Bhrandon, the Democrats controlled the Senate during the first 2 years of President Bush’s first term”
Actually it was more like 1 1/2 years.
Any why? Because Jeffords was so disgusted with the Republican party, he left it.
McCain? He went back to kissing Bush butt and voting with him 90% of the time even after Bush smeared his family.
Posted by: Ryan C | September 16, 2008, 12:57 pm 12:57 pm
I just read where the king of stutter is now taking his teleprompter with him on his campaign. It’s no doubt programed with the words of others because the shallow one doesn’t have enough gray matter to speak intelligently on any subject.
Obama – hot air and BS!
Posted by: dl | September 16, 2008, 12:57 pm 12:57 pm
glfgirl…I LOVE THIS!!!
Obama is not strong in anything.
Ha, maybe that is why he raised 60 million in August and beat Hillary!!!
Posted by: perplexed | September 16, 2008, 1:00 pm 1:00 pm
McCain is now comparing the financial crisis to 9/11 by saying we need that type of investigative commission.
This after saying our fundamentals are strong.
He is clueless.
Posted by: Ryan C | September 16, 2008, 1:00 pm 1:00 pm
boy these blog headings are on overtime trying to patch up McCain
Posted by: watching | September 16, 2008, 1:01 pm 1:01 pm
Lets just get down to the facts here… The fact is…John McCain is a Republican regardless what he wants us to believe. He reminds me of Bush.. He will say and tell you anything to get elected. They have this way about them.. get me in office and I will do as I wish. No thanks McCain…No thanks Sara.
Posted by: beck | September 16, 2008, 1:03 pm 1:03 pm
“Obama is not strong in anything.”
Posted by: Belle Starr | September 16, 2008, 1:06 pm 1:06 pm
Obama is playing the politics of fear – in this case, trying to exploit and amplify people’s fear for political gain.
It’s despicable.
Barack Obama has done NOTHING for the economy, and has no proposals to fix the broken financial world. Instead, he points fingers and heckles, hoping that this is enough to distract Americans so that he doesn’t have to put real plans forward.
Meanwhile, John McCain is saying tax payers shouldn’t bail out AIG – note that McCain has as an advisor someone who sits on the board of AIG – and is proposing a commission to investigate and likely regulate future activity.
Obama is an empty suit.
Posted by: JA | September 16, 2008, 1:12 pm 1:12 pm
It’s not the “fundamentals” that he wants the commission to investigate…
Posted by: SandyB | September 16, 2008, 1:13 pm 1:13 pm
Exactly – don’t panic everyone! followed by How dare he suggest that we are not headed toward a cliff!
Posted by: Wade | September 16, 2008, 1:17 pm 1:17 pm
Bingo, but add to this the fact that market work on perceptions and so responsible politicians need to reassure about the fundamentals even while they show they’re aware there’s a problem that needs to be addressed. The partisan in the Dems is at war with the responsible politician in them. (And the result makes them sound a lot like McCain — there’s a crisis, though the fundamentals are sound.)
Posted by: Judasmac | September 16, 2008, 1:18 pm 1:18 pm
“Financial disclosure reports suggest that some members of Congress may have a stake in AIG’s future. Twenty-seven lawmakers or their spouses owned stock in the company last year, according to the Center for Responsive Politics.
Representative Robin Hayes, a North Carolina Republican, led the way with between $1.8 million and $6.6 million of stock. Senator John Kerry, a Massachusetts Democrat, was the only other lawmaker with at least $1 million, reporting holdings valued at from $1.5 million to $2.1 million. House Speaker Nancy Pelosi, a California Democrat, reported owning between $250,000 and $500,000.”
Posted by: JA | September 16, 2008, 1:19 pm 1:19 pm
Does anyone know whether Obama is for or against bailing out AIG? McCain has openly stated he is against having ordinary tax payers bail out the wealthy.
link pls thanks
Posted by: JA | September 16, 2008, 1:22 pm 1:22 pm
“Senator John Kerry, a Massachusetts Democrat, was the only other lawmaker with at least $1 million, reporting holdings valued at from $1.5 million to $2.1 million.”
Posted by: Belle Starr | September 16, 2008, 1:24 pm 1:24 pm
Everyone with employer paid health benefits needs to be aware of McCain’s radical new approach that will result in millions more becoming uninsured. I will put in the link, but abc tends to censor these – please don’t censor abc, I’m trying to source my comments:
Posted by: Kate Mom of Twins | September 16, 2008, 1:25 pm 1:25 pm
Come on, someone has to know where Obama stands on the AIG issue.
Or has he not taken a position yet? Waiting for the outcome then will make a Monday morning quarterback call.
Posted by: JA | September 16, 2008, 1:28 pm 1:28 pm
“Everyone with employer paid health benefits … “
Posted by: Belle Starr | September 16, 2008, 1:31 pm 1:31 pm
When looking into campaign contributions from Freddie Mac, Fannie,Lehman Brothers, 2 names were at the top of the list consistantly Senater Dodd and Senater Obama, with Hillary and Kerry giving a win, place, show sffort also. John McCain appears on these lists, but much further down and much less money.
Posted by: Jim | September 16, 2008, 1:32 pm 1:32 pm
“Come on, someone has to know where Obama stands on the AIG issue.
Or has he not taken a position yet? Waiting for the outcome then will make a Monday morning quarterback call.”
Posted by: Belle Starr | September 16, 2008, 1:33 pm 1:33 pm
Please tell me I am wrong here…..
McCain has taken an stand on AIG.
Even Hillary Clinton has taken a definitive stand saying that bailing out these wealthy firms won’t solve the problem (and that instead we should freeze rates and help prevent foreclosure)
Not that you have to agree with one or the other, but where is Obama on this???
He’s busy pointing hte finger and trying to egg on fear rather than address the nation with proposals and ways to solve this dilemma???
Please tell me I’m wrong, because if I’m not this basically disqualifies Barack Obama as a serious candidate.
Posted by: JA | September 16, 2008, 1:36 pm 1:36 pm
The only community Obama has been organizing is the one on Wall Street. The banks, and investment firms have been pro Dodd and Obama.
Posted by: Jim | September 16, 2008, 1:38 pm 1:38 pm
OIl down to $92, unemployment 6% (almost the same level as Clinton years), no inflation.
Aren’t these enough to say that economy fundamentally in a good situation. So, what’s wrong with what McCain has said.
Dems are playing a dishonorable game, if they try to picture the economy as a depression so they can just win the White House!
Posted by: Frieda | September 16, 2008, 1:44 pm 1:44 pm
JA:
Obama is in the process of analyzing McCain’s position on AIG as we speak.
As soon as he and his 300 advisors can come up with the perfect synonym for McCain’s position, he will be voicing “his” stand on the issue.
Posted by: SandyB | September 16, 2008, 1:55 pm 1:55 pm
The Dems sound like chicken little. Not a winning image. Instead of running around prattling that the sky is falling, they should offer a calm and reassuring voice and talk about what they are going to do.
Posted by: NJH | September 16, 2008, 1:57 pm 1:57 pm
Seriously, Obama has to have said something on AIG.
There is no way he’s wasting time making half truths while the economy is in disaster.
WHERE DOES OBAMA STAND ON BAILING AIG OUT?
Posted by: JA | September 16, 2008, 2:03 pm 2:03 pm
“Seriously, Obama has to have said something on AIG.”
Posted by: Belle Starr | September 16, 2008, 2:07 pm 2:07 pm
beck: Of course McCain is a republican. What were you thinking. He’s not one of those underhanded inexperienced candidates running for office like Obama Hussein who has made people like you believe he is the best candidate for the white house even though he doesn’t have the capabilities to run this country or the knowledge of politics or foreign policy. He’s a know nothing, do nothing and says nothing. If he is elected you will see the dictatorship come out in him and the enemies he will make.
Posted by: Mariann Pepitone | September 16, 2008, 2:09 pm 2:09 pm
You will have your answer from Obama re:AIG bailout when McCain gives us
his solution….that will be the Obama
answer.
Posted by: MEW | September 16, 2008, 2:11 pm 2:11 pm
Kitty: Your right. They are the change, the change is to get rid of them for good. Especially Nancy Pelosi the troublemaker of the DNC along with the mouth Dean. Nancy was the cause of Hillary not winning the nomination when she practically had it in the bag. Nancy was so jealous of Hillary she could spit. Now we have Palin and she keeps her mouth shut. Palin would certainly put her in her place. Hillary was too soft on Nancy and let her step on her with the superdelegates.
Posted by: Mariann Pepitone | September 16, 2008, 2:13 pm 2:13 pm
One good move in Pelosi’s corner!!
Stepping on Hellery was great.
The eight years we had to have her hanging around in the WH was enough to puke your stomach linings out. Talk about an empty suit!!! That woman is dangerous.
Posted by: MEW | September 16, 2008, 2:19 pm 2:19 pm
Isn’t ACORN a community org., maybe Obama worked for them and that is why
we haven’t heard of his work.
Posted by: MEW | September 16, 2008, 2:25 pm 2:25 pm
This is not newsworthy since it calls into question the integrity and intelligence of a Democratic candidate (no response expected): In an article entitled “Biden’s Belly Flop”, Newsweek printed Joe Biden’s yearbook picture from his college days and a copy of his law school transcripts with the big “F” in his transcripts circled. Biden was given a chance to repeat his legal methods course, and above the “F” his retake grade of 80% was eventually penciled in. Being a repeat offender when it came to plagiarism made things much, much worse for Biden than they might have been otherwise in his failed bid for the Democratic presidential ticket in 1987.
Posted by: DuskyDakota | September 16, 2008, 2:38 pm 2:38 pm
The fundamentals of our economy are not strong as you pointed out Jake in an earlier post.
But this is not 1929. I seriously don’t think the majority of Americans will be lining up for free soup in the near future.
But for McCain to repeat that the fundamentals are strong after being hammered by the Dems for it shows he has lost his ability as a politician. And then to come back and say he meant “American workers” are the fundamentals just looks stupid.
Posted by: cincyr | September 16, 2008, 3:13 pm 3:13 pm
Fundamentals means basics, they way our economy is set up is strong if the dems/libs would stay out of it it would be fine.
How much money are the Obama making off this economy!!
How can Obama say the economy is anything when his elitist friend are buying 31,000 dollar dinners!!
Thats an Average American!! yes we all buy 31,000 dinners!
Posted by: spock | September 16, 2008, 3:30 pm 3:30 pm
Jake,
Thank you for this opportunity to help you get over yourself. The fundamentals of the American economy are not strong, they are weak — currently. It is true that America is a massive economic engine, but like any engine it’s the fuel and the destination that determine how far you go and where you end up.
John McCain believes in bad fuel (trickle-down policies and little or no government regulation of markets that are not transparent) and wants to her our contry in the wrong direction (private SS accounts held by the same Wall St. idiots who just blew up Lehman Brothers, etc.). The Democrats are saying that if John McCain is elected, he’ll screw things up so bad you won’t believe it.
That’s not a contradiction. But in the world of press reporting, journalistic spin is the new black. And may I say, you look fabulous….
Posted by: The Phantom | September 16, 2008, 4:17 pm 4:17 pm
“Question – if there is truly no reason to think we are headed into an economic depression and truly no reason to panic, aren’t the fundamentals, on some level, strong?”
Now there you go again making sense. That’s not going to go well with the left.
Posted by: drjohn | September 16, 2008, 4:29 pm 4:29 pm
The Phantom, if the fundamentals of the American economy are so week explain two facts:
(1) GDP grew in the first half of the year (0.9% in the first quarter; and 3.3% in the second quarter).
(2) Both candidates and both political parties raised a total of $152 million JUST IN AUGUST (Sen. Obama–$66 million; the DNC–$17 million; Sen. McCain–$47 million; and the RNC–$22 million).
Posted by: James Danley | September 16, 2008, 5:37 pm 5:37 pm
susie: those two are the worst hypocritical individuals in American polotical history.
Posted by: bombem | September 16, 2008, 6:05 pm 6:05 pm
James Danley:
If you haven’t noticed…THREE OF THE FIVE LARGEST INVESTMENT BANKING FIRMS HAVE BEEN BLOWN TO SMITHEREENS IN THE PAST FEW MONTHS…AND COUNTRYWIDE MORTGAGE WAS BOUGHT OUT BY BofA TO AVOID A SIMILAR PUBLIC FATE…AND BEAR STEARNS WAS EUTHANIZED BY THE US GOVERMENT…AND NOBODY HAS ANY FREAKING IDEA HOW MUCH DEBT IS REALLY OUT THERE…AND THE US ECONOMY, INCLUDING THE MARKETS, HAS BEEN GOING SIDEWAYS FOR SEVEN FREAKING YEARS…AND OUR DOLLAR IS BLEEDING…AND WE’RE LIVING OFF OVERSEAS CREDITORS…AND THE AVERAGE PERSON IS WORKING MORE FOR LESS, WITH LITTLE OR NOT HEALTHCARE, LITTLE OR NO RETIREMENT SAVINGS, AND LITTLE OR NO HOPE THAT THINGS WILL GET BETTER.
And you show me your numbers like it means something. It means nothing. GDP will always be calculable, and rarely look horrifying. As for the amount of money raised by the candidates, that’s a joke, right? You could take all the money that all candidates have ever raised in American politics and throw it at the cost of the Iraq War and it would buy us a couple of weeks.
A COUPLE OF FREAKING WEEKS!!!!!!!!!!
Posted by: The Phantom | September 16, 2008, 6:33 pm 6:33 pm
Gosh, Reps come out like sharks when someone brings up Herbert Hoover and McCain in the same paragraph ;-)
Posted by: Mario | September 16, 2008, 8:10 pm 8:10 pm
I think McCain’s response was exactly what a president does. First he reassures, then he builds hope and confidence that we can get through this crisis, then he lays out a plan for fixing it.
Obama and the democrats used the occasion to gain politically and make everyone more anxious. Now that isn’t the kind of leadership I want. Don’t jump into the panic and take advantage of a crisis. McCain knows there are big problems–he just didn’t want everyone nose diving.
Posted by: rafraf | September 16, 2008, 8:36 pm 8:36 pm
Oh, for pity’s sake. McCain’s “clarifications” about his comments were that American workers were still teh awsum. This is what he meant by the fundamentals of the economy are strong. This is not what, let’s just say economists, mean by the fundamentals of the economy are strong, but okay. The economy is only bad when American workers suck. I am starting to believe John McCain when he said he didn’t know much about the economy.
Posted by: jibeaux | September 16, 2008, 9:02 pm 9:02 pm
Because there is nothing whatsoever in between “strong economy” and “run on the banks! panic! Depression!”
Posted by: jibeaux | September 16, 2008, 9:03 pm 9:03 pm
The Liberal anti-McCain Press have a new name called “CELESTINES Woes”. They woe in the morning,they woe at midday and they woe at sunset.Seems they have their hands full.
Posted by: MFB | September 16, 2008, 10:27 pm 10:27 pm
Biden’s on the road throwing his friend of 30 years John McCain under the bus. Would you throw a close friend of 30 years under the Bus? In Public? Obama threw his Spiritual leader and Grandmother under the bus. These two are throwing the average man and woman under the bus with their incessant blaming of the republicans with the failing economy. Pelosi and Reed promised all kinds of changes when they came to power two years ago and headed the do nothing congress thus throwing the electorate under the bus. Gasoline was two dollars a gallon two years ago but you and yours as well as me and mine got thrown under the liberal bus. Wake up America before you and yours get run over by the liberal bus.
By HKettlehake
Posted by: HKettlehake | September 16, 2008, 11:10 pm 11:10 pm
Does Harry Reid have ANY credibility? The man is total partisan hack loser.
He and Pelosi are just the leftwing versions of Tom “The Hammer” DeLay. People that put PARTY before COUNTRY.
Pelosi and Reid have presided over the most worthless Congress in history. McCain should take it as a COMPLIMENT anytime Pelosi and Reid badmouth him.
Posted by: Delia Reid | September 17, 2008, 2:10 am 2:10 am
If economy is not strong nor sound, should I sell off my stocks now to be safe? Obama should know better what he is saying, he makes me nervous. Seems Obama is the one out of tocuh this time. Scary.
Posted by: carl | September 17, 2008, 7:37 am 7:37 am
The Phantom, the free market works best when government leaves well enough alone. The downturn in the housing market was a cyclical thing. When prices got too high, people stopped buying. There are plenty of buyers out there, but now they are waiting for the best buys. Eventually the buyers will begin buying again, and prices will go back up. Under normal circumstances this should have been a fairly smooth ride down and a fairly quick return back up.
HOWEVER, the crisis that we now have is because for years many of the banks were giving mortgages to just about anyone who applied; and the investment firms began buying many of these mortgages. No longer did you have to prove the ability to pay back the loans. And to compound this these same banks pushed the high risk, subprime flexible rates onto their customers. And with these low flexible rates, speculators began purchasing homes left and right. This was all working out well until the housing market turned south. Soon many of the homes were worth half or even a third of the amount of the mortgage. So the interest rates skyrocketed. All of a sudden mortgage payments were doubled and even tripled. The speculators with multiple mortgages just simply walked away. The poor individual who was living in his home and now unable to make the mortgage payments lost his or her home. And then these investment firms and banks were stuck with hundreds of thousands of foreclosed properties worth a fraction of the original purchasing price.
While greed had a hand in causing this crisis, the culprit was the federal goverment’s interference. Investor’s Business Daily, on Monday, posted the following on their website: “Tough new regulations forced lenders into high-risk areas where they had no choice but to lower lending standards to make the loans that sound business practices had previously guarded against making. It was either that or face stiff government penalties.”
There are now tens of thousands of individuals in the market to purchase a home. But due to the mortgage crisis, loans are almost impossible to obtain. Without the subprime mortgage fiasco, we would already be on our way back. Now it could take several years to recover.
The sad thing is Congress doesn’t even understand the role it played in all of this. And now Congress wants to meddle into the free market again regarding the skyrocketing energy prices. Let the free market correct itself.
Posted by: James Danley | September 17, 2008, 9:04 am 9:04 am
The Democrats apparently had their collective heads in the sand 5 years ago:
The NY Times five years ago reported that the Bush administration proposed increased oversight and regulation of Fannie and Freddie, but Democrats pushed back. “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.” Democrats pushed back: “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.”
Posted by: Jane Becker | September 17, 2008, 5:18 pm 5:18 pm