The Foxes

The most annoying thing about this financial crisis is the feeling that the foxes are in charge of the chicken coop, the foxes being Barney Frank, Chris Dodd and Chuck Schumer, among others.

Today’s Wall Street Journal on its op-ed page, quotes what the foxes said “back in the day.”

Here’s an excerpt:

House Financial Services Committee hearing, Sept. 10, 2003:

Rep. Barney Frank (D., Mass.): I worry, frankly, that there’s a tension here. The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios. . . .

Rep. Maxine Waters (D., Calif.): Secretary Martinez, if it ain’t broke, why do you want to fix it? Have the GSEs [government-sponsored enterprises] ever missed their housing goals?

* * *
House Financial Services Committee hearing, Sept. 25, 2003:

Rep. Frank: I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . .

* * *
House Financial Services Committee hearing, Sept. 25, 2003:

Rep. Gregory Meeks, (D., N.Y.): . . . I am just pissed off at Ofheo [Office of Federal Housing Enterprise Oversight] because if it wasn’t for you I don’t think that we would be here in the first place.

And Freddie Mac, who on its own, you know, came out front and indicated it is wrong, and now the problem that we have and that we are faced with is maybe some individuals who wanted to do away with GSEs in the first place, you have given them an excuse to try to have this forum so that we can talk about it and maybe change the direction and the mission of what the GSEs had, which they have done a tremendous job. . .

Ofheo Director Armando Falcon Jr.: Congressman, Ofheo did not improperly apply accounting rules; Freddie Mac did. Ofheo did not try to manage earnings improperly; Freddie Mac did. So this isn’t about the agency’s engagement in improper conduct, it is about Freddie Mac. Let me just correct the record on that. . . . I have been asking for these additional authorities for four years now. I have been asking for additional resources, the independent appropriations assessment powers.

This is not a matter of the agency engaging in any misconduct. . . .

Rep. Waters: However, I have sat through nearly a dozen hearings where, frankly, we were trying to fix something that wasn’t broke. Housing is the economic engine of our economy, and in no community does this engine need to work more than in mine. With last week’s hurricane and the drain on the economy from the war in Iraq, we should do no harm to these GSEs. We should be enhancing regulation, not making fundamental change.

Mr. Chairman, we do not have a crisis at Freddie Mac, and in particular at Fannie Mae, under the outstanding leadership of Mr. Frank Raines. Everything in the 1992 act has worked just fine. In fact, the GSEs have exceeded their housing goals. . . .

Rep. Frank: Let me ask [George] Gould and [Franklin] Raines on behalf of Freddie Mac and Fannie Mae, do you feel that over the past years you have been substantially under-regulated?

Mr. Raines?

Mr. Raines: No, sir.

Mr. Frank: Mr. Gould?

Mr. Gould: No, sir. . . .

Mr. Frank: OK. Then I am not entirely sure why we are here. . . .

Rep. Frank: I believe there has been more alarm raised about potential unsafety and unsoundness than, in fact, exists.

* * *
Senate Banking Committee, Oct. 16, 2003:

Sen. Charles Schumer (D., N.Y.): And my worry is that we’re using the recent safety and soundness concerns, particularly with Freddie, and with a poor regulator, as a straw man to curtail Fannie and Freddie’s mission. And I don’t think there is any doubt that there are some in the administration who don’t believe in Fannie and Freddie altogether, say let the private sector do it. That would be sort of an ideological position.

Mr. Raines: But more importantly, banks are in a far more risky business than we are.

* * *
Senate Banking Committee, Feb. 24-25, 2004:

Sen. Thomas Carper (D., Del.): What is the wrong that we’re trying to right here? What is the potential harm that we’re trying to avert?

Federal Reserve Chairman Alan Greenspan: Well, I think that that is a very good question, senator.

What we’re trying to avert is we have in our financial system right now two very large and growing financial institutions which are very effective and are essentially capable of gaining market shares in a very major market to a large extent as a consequence of what is perceived to be a subsidy that prevents the markets from adjusting appropriately, prevents competition and the normal adjustment processes that we see on a day-by-day basis from functioning in a way that creates stability. . . . And so what we have is a structure here in which a very rapidly growing organization, holding assets and financing them by subsidized debt, is growing in a manner which really does not in and of itself contribute to either home ownership or necessarily liquidity or other aspects of the financial markets. . . .

Sen. Richard Shelby (R., Ala.): [T]he federal government has [an] ambiguous relationship with the GSEs. And how do we actually get rid of that ambiguity is a complicated, tricky thing. I don’t know how we do it.

I mean, you’ve alluded to it a little bit, but how do we define the relationship? It’s important, is it not?

Mr. Greenspan: Yes. Of all the issues that have been discussed today, I think that is the most difficult one. Because you cannot have, in a rational government or a rational society, two fundamentally different views as to what will happen under a certain event. Because it invites crisis, and it invites instability. . .

Sen. Christopher Dodd (D., Conn.): I, just briefly will say, Mr. Chairman, obviously, like most of us here, this is one of the great success stories of all time. And we don’t want to lose sight of that and [what] has been pointed out by all of our witnesses here, obviously, the 70% of Americans who own their own homes today, in no small measure, due because of the work that’s been done here. And that shouldn’t be lost in this debate and discussion. . . .

The Journal also has a compendium of its Fannie Mae/Freddy Mac editorials. My favorite is the one on “patron saint” Barney Frank.

And another grand slam from Ms. Coulter.

An excerpt:

…Being interviewed by Katie Couric on the “CBS Evening News,” [Joe] Biden said: “When the stock market crashed, Franklin D. Roosevelt got on the television and didn’t just talk about the, you know, the princes of greed. He said, ‘Look, here’s what happened.'”

For those of you who aren’t hard-core history buffs, Biden not only named the wrong president during the 1929 stock market crash, he also claimed a president who wasn’t president during the stock market crash went on TV before Americans had TVs.

Other than that, the statement holds up pretty well. At least Biden managed to avoid mentioning any “clean” Negroes he had met.

Couric was nearly moved to tears by the brilliance of Biden’s brain-damaged remark. She was especially intrigued by Biden’s claim that FDR had said the new iPhone was the bomb!

Here is Couric’s full response to Biden’s bizarre outburst about FDR (a) being president and (b) going on TV in 1929: “Relating to the fears of the average American is one of Biden’s strong suits.”

But when our beauteous Sarah said that John McCain was a better leader on the economy than Barack Obama, Couric relentlessly badgered her for evidence. “Why do you say that?” Couric demanded. “Why are they waiting for John McCain and not Barack Obama? … Can you give us any more examples of his leading the charge for more oversight?”

The beauteous Sarah had cited McCain’s prescient warnings about Fannie Mae and Freddie Mac. But Couric, the crackerjack journalist who didn’t know FDR wasn’t president in 1929, demanded more examples from Palin.

We are currently in the middle of a massive financial crisis brought on by Fannie Mae. McCain was right on Fannie Mae; Obama was wrong. That’s not enough?

Not for the affable Eva Braun of evening TV! “I’m just going to ask you one more time,” Couric snipped, “not to belabor the point. Specific examples in his 26 years of pushing for more regulation?”

This would be like responding to someone who predicted the 9/11 attacks by saying: OK, you got one thing right. Not to belabor the point, but what else?

Obama was not merely wrong on Fannie Mae: He is owned by Fannie Mae. Somehow Obama managed to become the second biggest all-time recipient of Fannie Mae political money after only three years in the Senate. The biggest beneficiary, Democratic Sen. Chris Dodd, had a 30-year head start on receiving loot from Fannie Mae — the government-backed institution behind our current crisis.

How does the Democratic ticket stack up on other major issues facing the nation, say, gas prices?

Shockingly, Sen. Joe Biden was one of only five senators to vote against the first Alaskan pipeline bill in 1973. This is like having been a Nazi sympathizer during World War II. If Sarah Palin does nothing else, she has got to tie that idiotic pipeline vote around Biden’s neck.

The Senate passed the 1973 Alaskan pipeline bill by an overwhelming 80-5 vote. Only five senators voted against the pipeline on final passage. Sen. Biden is the only one who is still in the Senate — the other four having been confined to mental institutions long ago.

The stakes were clear: This was in the midst of the first Arab oil embargo. Liberal Democrats, such as senators Robert Byrd, Mike Mansfield, Frank Church and Hubert Humphrey, all voted for the pipeline.

But Biden cast one of only five votes against the pipeline that has produced more than 15 billion barrels of oil, supplied nearly 20 percent of this nation’s oil, created tens of thousands of jobs, added hundreds of billions of dollars to the U.S. economy and reduced money transfers to the nation’s enemies by about the same amount.

The only argument against the pipeline was that it would harm the caribou, an argument that was both trivial and wrong. The caribou population near the pipeline increased from 5,000 in the 1970s to 32,000 by 2002.

It would have been bad enough to vote against the pipeline bill even if it had hurt the caribou. A sane person would still say: Our enemies have us in a vice grip. Sorry, caribou, you’ve got to take one for the team. But when the pipeline goes through and the caribou population sextuples in the next 20 years, you really look like a moron.

We couldn’t possibly expect Couric to ask Biden about a vote that is the equivalent of voting against the invention of the wheel. But couldn’t she have come up with just one follow-up question for Biden on FDR’s magnificent handling of the 1929 stock market crash?

Or here’s a question the public is dying to know: “If Obama wanted a historically delusional vice president, why not Lyndon LaRouche?” At least LaRouche didn’t vote against the Alaskan pipeline.

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