- Well...whaddya know...Con-gress continues to do things in the dark of night to pass items (remember, Monday @ 1 AM to vote to bring the bill to the floor). But, now they slip to new lows...Christmas Eve, after dinner news cycle, to pass the healthcare reform bill and avoid drawing anymore attention?
- And coming in right behind them as a close second in the "we can be sleazy too" contest...US Treasury announces the Obama administration's decision to cover an unlimited amount of losses at the mortgage-finance giants Fannie Mae and Freddie Mac over the next three years which removed the previous $200 billion loss caps on each. Prepare yourself because it's coming...the next huge bailout has now been made inevitable...the question is simply when. I suspect it will be a slow, steadily increasing bleed just so the unwashed masses don't become outraged at a single huge announcement.
- Which brings me to my next point....
Above picture, I just read a fantastic book that, historically, connects all the dots regarding the mess we're in and how it will continue to result in rolling crises / taxpayer bailouts until government once again frees the free market instead of attempting to coerce the markets into unsustainable and market deforming political mandates. Below is a review of the book....HIGHLY RECOMMENDED (Warning: you will be absolutely sickened by the long slow motion trainwreck that we are still on)!!! I truly hope you read it...if it's not at your library, ask your librarian how to get it through the Inter-Library Loan system.
Architects of Ruin, bestselling author Peter Schweizer describes in riveting detail how a coalition of left-wing activists, liberal politicians, and "do-good capitalists" on Wall Street leveraged government power to achieve their goal of broadening homeownership among minorities and the poor. The results were not only devastating to the economy, but hurt the very people they were supposedly trying to help.
Built slowly, over decades, and agressively expanded in the mid 1990's....The story begins in the 1960s with Saul Alinsky, the legendary Chicago rabble-rouser who trained his acolytes in highly aggressive techniques of community activism. Alinsky's disciples—along with race-baiting activists like Jesse Jackson—seized on the "redlining" controversy of those years to argue that banks were guilty of racial discrimination. In the 1970s, with the help of liberal senators like Ted Kennedy and William Proxmire, legislation was passed that put bankers under the thumb of local activists.
In the Clinton years, a new generation of liberal technocrats came to power in Washington and on Wall Street. Schweizer describes how a powerful phalanx of elite liberals, including Bill Clinton, Robert Rubin, Andrew Cuomo, Barney Frank, Chris Dodd, Janet Reno, Deval Patrick, Henry Cisneros, Barack Obama, Nancy Pelosi, Ted Kennedy, Charles Schumer, and many others, aggressively pushed banks to make trillions of dollars in loans to individuals who should never have received them.
Meanwhile, Clinton forged a new form of state capitalism in which the big Wall Street financial companies were repeatedly bailed out—with their profits intact—from a series of costly errors, leading them to take ever larger risks. Both financial policies had profoundly distorting effects. The result was the bursting of twin bubbles in mortgages and mortgage-backed derivatives, in turn leading to a global economic collapse.
This tale of liberal "Robin Hood capitalism run wild" has never been told. But more than just a story about the past, it is also an urgent warning about the future. For today, the very same people who planted the seeds of the collapse are back in Washington, tasked with cleaning up the mess and determined to use the crisis they caused as cover for a massive overhaul of the American economic system.
These people have learned nothing from their past mistakes and are busy applying the same methods to other sectors of the economy—health care, the auto industry, real estate (again!), and above all the promotion of "green" technologies—inflating bubbles that are sure to bring about another crisis. Ordinary Americans who foot the bill for the last state-capitalist bubble have reason to be afraid—very afraid—of the inevitable result.
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