Posted by
Noam D. Gear on Sunday, March 01, 2009 3:20:01 PM
As we see people evicted from their homes, I ask readers not to get caught up in the false debate as to whether we should blame banks, bankers, home-buyers… for the banking crisis now at hand
None of those is to blame.
A far more deserving target of blame is Barney Frank, the insane US congressman from Massachusetts. He bears great responsibility for advancing the legislation in 1995 that required banks to make loans to people who could not afford to repay them. In the same stroke, he wiped out the regulations that would have stopped the lending when critical thresholds of insolvency were reached. Mr. Frank did this knowing that it could destabilize the banking system of the country, and yet he did it anyway.
This is like cutting the break cables on the car and then removing the guardrails from the road. All of the burning wreckage we have now is a direct consequence of his actions. Amazingly, even after seeing six months of burning wreckage all over the economy, Mr. Frank is proud of his “accomplishment”.
I encourage readers to search for “Community Reinvestment Act” (CRA) and watch the old C-SPAN video of Barney Frank and Andrew Cuomo arguing in favor of wiping out these two important banking regulations for Freddie and Fannie. It is a real eye-opener, and entertaining too.
Thinking back to the happy days of tiny scandals like Enron, I can recall four different Congressional hearings where executives such as Ken Lay (CEO), and Jeff Skilling (CFO) were called upon to explain what they did…and then they were jailed. The crimes of the Enron executives were 8,000 times smaller than the Freddie Mac and Fannie Mae Scandal—in which Frank and his chums discarded the regulation that had required those two institutions (and others) to keep a 4% solvency reserve. Further scandal is that senior executives of Freddie and Fannie and every other financial institution in trouble contributed huge sums of money to the Democrats who ran those committees, and smaller sums to some Republicans who were also on those committees.
Scaling this crime to Enron, we should expect to have seen 16,000 Congressional Hearings by now…with another 16,000 hearings to come soon. Have you noticed one single Congressional Hearing yet? No. There have been none. None are planned.
Like third-world dictators, Democrats never hold themselves to the same rules they create for everyone else. Henry Waxman will never hold Barney Frank to account. Nancy Pelosi will never hold Henry Waxman to account. Journalists at MSNBC will demand to know which newspapers Sarah Palin reads—because they judge her to be ignorant and uninformed.
To stuff the economic wound created by Mr. Frank, the Obama administration has now announced a plan to run a deficit of about $1.8 trillion in 2009, which is about four times larger a deficit than George Bush’s most reckless year. The USA will most likely borrow this money from the government of China. Assuming China takes on the whole deficit for us, that government would need to extract about $720 from every man, woman, and child in China. For a family of five (including one child and two grandparents), that might be a month’s pay. They would use that money to buy food, and other essentials, but we will use it for a high-speed train that will to connect Disneyland to Las Vegas; Obama’s new personal fleet of 28 helicopters; New grass sod in Washington DC…
The list of American folly that Chinese people will be forced to pay for goes on at a pace of $70 million per page, for over a thousand pages.
Meanwhile, Mr. Frank still has his job in Washington, where he lectures us about “fairness” every night via the wonder of television.
A while ago, a popular semantic game was to ask, “Why do Islamic terrorists hate the United States?”
Here in Massachusetts, we should be asking, “Why do people in other States hate Massachusetts?” One answer is that we manufacture and sell politicians like Barney Frank. It would be okay if Frank inflicted his pain only upon those who voted for him, but that is not the case. His insane ideas about “fairness” inflict pain upon the entire country, and now China too.
The people of Massachusetts have eaten far too much mindless liberalism—which is very much like eating far too much broccoli. As a result, Congressman Barney Frank is now a foul cloud of flatulence that only Massachusetts cannot smell. It is time to open the window and let him out, for the sake of the other passengers in the car.