Reckless Endangerment by Gretchen Morgenson

This post from Powerline contains a brief (less than 5 minutes) video of an interview by Sean Hannity with Gretchen Morgenson who wrote this book "Reckless Endangerment".  The book chronicles the events which led to the financial meltdown that has left our economy in shambles.  There are several other books out there on the meltdown but it appears this one is the most complete at least in terms of holding all the various players involved over many years to account.  A must read.

Acorn and Obama -- one more time yet again

Democracy is susceptible to highly organized and motivated minorities no matter how venal or destructive these groups may be.  Below is an example of how one such group, Acorn, can and did pervert the democratic process and made a highly destructive contribution to the downfall of our financial system from which we are still trying to recover.  The only way to prevent this kind of outcome is to rally the general public to the real danger these groups are to the general wellbeing of the democracy.  Herein lies the problem.  At this point in time we have in this country a media incapable, or worse yet, unwilling to fulfill its fourth estate role of informing the general public about threats presented by extralegal and even criminal organizations.  We are finding out what its like to live in a country in which the media is captive of one political party.  Until the American public wakes up to the destructive bias of the mainstream media, organizations like Acorn will have free reign to distort and corrupt our democracy.

By STANLEY KURTZ

Still pushing to protect junk mortgages at any cost: ACORN continues to march and rally to get Congress to support its radical agenda, as with this demonstration in Washington, DC, in March.

Posted: 4:09 am
October 13, 2008

TO discover the roots of to day's economic crisis, consider a tale from 1995.

That March, House Speaker Newt Gingrich was scheduled to address a meeting of county commissioners at the Washington Hilton. But, first, some 500 protesters from the Association of Community Organizations for Reform Now (ACORN) poured into the ballroom from both the kitchen and the main entrance.

Hotel staffers who tried to block them were quickly overwhelmed by demonstrators chanting, "Nuke Newt!" and "We want Newt!" Jamming the aisles, carrying bullhorns and taunting the assembled county commissioners, demonstrators swiftly took over the head table and commandeered the microphone, sending two members of Congress scurrying.

The demonstrators' target, Gingrich, hadn't yet arrived - and his speech was cancelled. When the cancellation was announced, ACORN's foot soldiers cheered.

Editorial writers from Little Rock to Buffalo condemned ACORN's action as an affront to both civility and freedom of speech. Editorialists also pointed out that the "spending cuts" the protesters railed against were imaginary - Gingrich proposed merely to slow the growth in some welfare programs and turn control back to the states.

Yet ACORN had only just begun. Two days later, 50 to 100 of the same protesters hit their main target - a House Banking subcommittee considering changes to the Community Reinvestment Act, a law that allows groups like ACORN to force banks into making high-risk loans to low-credit customers.

The CRA's ostensible purpose is to prevent banks from discriminating against minorities. But Rep. Marge Roukema (R-NJ), who chaired the subcommittee, was worried that charges of discrimination had become an excuse for lowering credit standards. She warned that new, Democrat-proposed CRA regulations could amount to an illegal quota system.

FOR years, ACORN had combined manipulation of the CRA with intimidation-protest tactics to force banks to lower credit standards. Its crusade, with help from Democrats in Congress, to push these high-risk "subprime" loans on banks is at the root of today's economic meltdown.

When the role of ACORN and congressional Democrats in the mortgage crisis is pointed out, Democrats reply that banks subject to the CRA represent only about a quarter of the loans that led to our current troubles. In fact, the problem goes way beyond the CRA.

As ACORN ran its campaigns against local banks, it quickly hit a roadblock. Banks would tell ACORN they could afford to reduce their credit standards by only a little - since Fannie Mae and Freddie Mac, the federal mortgage giants, refused to buy up those risky loans for sale on the "secondary market."

That is, the CRA wasn't enough. Unless Fannie and Freddie were willing to relax their credit standards as well, local banks would never make home loans to customers with bad credit histories or with too little money for a downpayment.

That is, the CRA wasn't enough. Unless Fannie and Freddie were willing to relax their credit standards as well, local banks would never make home loans to customers with bad credit histories or with too little money for a downpayment.

So ACORN's Democratic friends in Congress moved to force Fannie Mae and Freddie Mac to dispense with normal credit standards. Throughout the early '90s, they imposed ever-increasing subprime-lending quotas on Fannie and Freddie.

But then the Republicans won control of Congress - and Rep. Roukema scheduled her hearing. ACORN went into action to protect its golden goose.

IT struck as Roukema aired her concerns at that hearing. Pro testers, led by ACORN President Maud Hurd, stood up and began chanting, "CRA has got to stay!" and "Banks for greed, not for need!" The protesters then demanded the microphone.

With the hearing interrupted and the demonstrators refusing to leave, Roukema called the Capital Police, who arrested Hurd and four others for "disorderly conduct in a Capital building" - a charge carrying a penalty of a $500 fine, six months in prison or both. As the police arrived, two of the protesters menacingly approached Roukema's desk, still demanding the hearing microphone.

Requests to the Capital Police to release the activists from Sen. Ted Kennedy (D-Mass.) and Rep. Joe Kennedy (D-Mass,) failed. Then Rep. Maxine Waters (D-Calif.) showed up at the jail and refused to leave until the protesters were released; the Capital Police relented.

Meanwhile, instead of repudiating ACORN's intimidation tactics, Rep. Kennedy berated Roukema for arresting one of his constituents and accused the Republicans of preparing for "an all-out attack on CRA." He also promised to introduce legislation to expand the CRA's coverage to mortgage bankers and large credit unions.

THIS little slice of political life from 1995 had a variety of ripple effects. Above all, ACORN's intimidation tactics, and its alliance with Democrats in Congress, triumphed. Despite their 1994 takeover of Congress, Republicans' attempts to pare back the CRA were stymied.

Instead, Democrats like Rep. Barney Frank (D-Mass.) and Reps. Kennedy and Waters allied with the Clinton administration to broaden the acceptability of risky subprime loans throughout the financial system, thus precipitating our current crisis.

ACORN had come to Congress not only to protect the CRA from GOP reforms but also to expand the reach of quota-based lending to Fannie, Freddie and beyond. By steamrolling the GOP that March, it had crushed the last potential barrier to "change."

Three months later, the Clinton administration announced a comprehensive strategy to push homeownership in America to new heights - regardless of the compromise in credit standards that the task would require. Fannie and Freddie were assigned massive subprime lending quotas, which would rise to about half of their total business by the end of the decade.

WHEN the ACORN-Democrat alliance finally succeeded in blocking Republicans from restoring fiscal sanity in 1995, the way was open to virtually unlimited lending quotas - and to a whole new way of thinking about credit standards.

Urged on by ACORN, congressional Democrats and the Clinton administration helped push tolerance for high-risk loans through every sector of the banking system - far beyond the sort of banks originally subject to the CRA.

So it was the efforts of ACORN and its Democratic allies that first spread the subprime virus from the CRA to Fannie and Freddie and thence to the entire financial system.

Soon, Democratic politicians and regulators actually began to take pride in lowered credit standards as a sign of "fairness" - and the contagion spread.

And when financial institutions across the board saw that they could make money by trading what would once have been considered junk loans, the profit motive kicked in. But the bad seed that started it all was ACORN.

HOW does Barack Obama fit into all of this? Obama has been a key ally of Chicago ACORN going back to his days as a community organizer.

Later, as a young lawyer, he offered leadership training to the activists who were forcing Chicago banks into high-risk subprime loans. And when he made it on to the boards of Chicago's Woods Fund and the Chicago Annenberg Challenge, he channeled money ACORN's way.

Obama was perfectly aware of ACORN's intimidation tactics - indeed, he oversaw a Woods Fund report that boasted of managing to fund the radical group despite its shocking behavior.

And as a lawmaker, in Illinois and in Washington, he has continued to back ACORN's leglislative agenda.

ACORN's high-pressure tactics live on. And congressional Democrats are still covering for ACORN, funneling it money and doing its legislative bidding. ACORN also continues its shady ways, using a vast network of technically separate but in fact quite interconnected organizations to evade federal laws on the politicized use of government money.

Perhaps most disturbing of all, the Obama campaign appears to have little more regard for freedom of speech than Reps. Kennedy or Waters did when they backed up ACORN's thugs in 1995. The campaign actually practices ACORN-style tactics, sending out "action wires" that call on supporters to block Obama critics from radio appearances (a tactic once applied to me) and demanding legal actions against unfriendly political advertisers.

As a presidential candidate, Obama promises a massive national-service program closely allied with the nonprofit sector. He wants to remove "barriers for smaller nonprofits to participate in government programs."

In other words, he plans a massive effort to funnel America's youth into volunteer work alongside the likes of ACORN. So Obama's favorite community organizers may soon be training your child.

ACORN's alliance with the Democratic Party is at the root of the current financial meltdown. And Barack Obama has stayed true to ACORN's ways.

Pretty soon, the folks who poured into the Washington Hilton to shut down Speaker Gingrich in 1995 may no longer need to take over the microphone. They'll be in charge of it.

Stanley Kurtz is a senior fellow with the Ethics and Public Policy Center in Washington.

Read more: http://www.nypost.com/p/news/opinion/opedcolumnists/item_2apJAuC2tslB4no8AK15iO#ixzz1SIOEJUuV

Obama -- an analysis via the Claremont Institute

How to get the truth about Obama's past and his socialist roots, which are deep and wide, is the key to defeating him in 2012.  As can be seen from this Claremont Institute series here, much of Obama's past was disguised during and since the last election, but in the meantime there have been a number of books written that actually shed some light on who this guy is and where he comes from.  To expand on this information and get it out to the public at large is going to be a very big challenge, however it can and must be done otherwise he continues on for another four years doing grave harm to what's left of the Republic.  The Powerline link here provides further access to other important articles and reviews of books that have dealthwith aspects of The One's life.  All of the information available on these sites and through these links should be required reading for anyone who intends to vote in the next election.  Also everyone should be aware that the Communists, just like the Muslims, consider lying to further the interest of each's goals, to be not only justified, but smart policy.  That's why digging out the truth and exposing ist to the public is so crucial.  We can be subjugated to this vile philosophy if we don't react to the lies being perptrated about Obama and his cohorts and where the really want to take this country.  Beware!

OBAMA'S faux offer to Republicans

Keith Hennesey here outlines the Obama response/offer to the republicans in the current debate over extending the debt limit.  Clearly Obama has turned his back on the very commission he appointed, a bipartisan one no less, to come up with a workable solution to the impasse.  Naturally Obama, who wants to pander and play to his base, has rejected the very recommendations his own bipartisan commission has come up with.  Really neat guy.

Tax increases baked in the cake

From the WSJ is a partial list of tax increases thus far under the Obama regime.  Mind you, he want to increase taxes much more on the so-called wealthy and will accomplish an across the board tax increase when the Bush tax decreases expire in 2012.  Sounds like he wants to get us to the 50% of GDP rate of Sweden and other socialist states during his tenure.

Taxpayer cost over 10 years: $210 billion.

• Also starting in 2013 is a 2.3% excise tax on medical device manufacturers and importers. That’s estimated to raise $20 billion.

• Already underway this year is the new annual fee on “branded” drug makers and importers, which will raise $27 billion.

• Another $15.2 billion will come from raising the floor on allowable medical deductions to 10% of adjusted gross income from 7.5%.

• Starting in 2018, the bill imposes a whopping 40% “excise tax” on high-cost health insurance plans. Though it only applies to two years in the 2010-2019 window of ObamaCare’s original budget score, this tax would still raise $32 billion—and much more in future years.

• And don’t forget a new annual fee on health insurance providers starting in 2014 and estimated to raise $60 billion. This tax, like many others on this list, will be passed along to consumers in higher health-care costs.

There are numerous other new taxes in the bill, all adding up to some $438 billion in new revenue over 10 years. But even that is understated because by 2019 the annual revenue increase is nearly $90 billion, or $900 billion in the 10 years after that. Yet Mr. Obama wants to add another $1 trillion in new taxes on top of this.

In addition to the above Steven Haywood offers the following:

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POSTED ON JULY 12, 2011 BY STEVEN HAYWARD IN FEDERAL BUDGET

“MISTER, WE COULD USE A MAN LIKE WARREN HARDING AGAIN!”

Baby-boomers and watchers of the TV Land channel will recall the line from “Those Were the Days”—the custom version written as the theme song for “All in the Family,” not the more familiar Charles Strouse/Lee Adams composition—which runs, “Mister, we could use a man like Herbert Hoover again!”  Norman Lear no doubt thought the invocation of Hoover, the Democratic Party’s go-to whipping boy for decades, would help hammer home his main purpose of mocking conservative middle class Americans.

Of course, he, like most liberals, had Hoover wrong.  For all of Hoover’s virtues, we cannot count sound economic policy among them.  As Dan Mitchell and others have pointed out, Hoover increased government spending 47 percent in his one term, raised taxes, and signed off on the disastrous Smoot-Hawley tariff, which first caused Franklin Roosevelt to run against Hoover’s profligacy, but later caused Rex Tugwell to say later that “practically the whole New Deal was extrapolated from programs that Hoover started.”

If Lear really wanted to raise hackles, he would have changed the lyrics to, “Mister, we could use a man like Warren Harding again!”  Now that would have raised some eyebrows and hackles alike.  No president is held in lower regard than Harding.  Yet watching the Obama Administration’s economic performance makes me think Harding is exactly the kind of president we need today.

I’ve been delving into Harding biographies and histories of his time for my current book project (more about this in due course as it gets closer to publication next year), and most everything you think you know about Harding is wrong, except for the bit about his assignations in a White House closet with one of his mistresses.

Did you know, for example, that Harding was the person most responsible for popularizing the now commonplace phrase, “the Founding Fathers”?  Or that he gave speech in Birmingham, Alabama that shocked the segregated audience when he called for racial equality?

There’s much more in this vein to recommend Harding, but what concerns us most acutely today is Harding’s economic policy, especially his response to the economic crisis of 1920-21 that can only be described as a depression.  World War I had left the nation with runaway inflation and a soaring debt.  The national debt had increased from $1 billion in 1914 to $24 billion by 1920—a spending growth record that Obama must surely envy.  The economic collapse of 1920 saw GDP shrink by a quarter, unemployment rise to about 15 percent (there were no official unemployment statistics in those days), and business bankruptcies soar.

So what did Harding do?  A “stimulus”?  A jobs program?  “Targeted” tax cuts?  Government bailouts for ailing companies?  Nope—he cut government spending sharply and rapidly (by almost 50 percent), began cutting tax rates across the board, and allowed asset values and wages to adjust freely as fast as possible.  Harding’s administration, Paul Johnson observed, “was the last time a major industrial power treated a recession by classic laissez-fairemethods, allowing wages to fall to their natural level . . .  By July 1921 it was all over and the economy was booming again.”  The Cato Institute’s Jim Powell offers a more complete summary of Harding’s soundness on economic policy, but suffice it to say that Harding’s traditional approach prevented the depression of 1920-21 from becoming a Great Depression, and in fact set the stage for the roaring twenties.

All of this comes to mind noting how just about every policy of the Obama Administration has chosen has extended the economic doldrums of the moment.  The Wall Street Journalreminds us again this morning about how Obama recently expressed bewilderment that the housing market “hasn’t bottomed out as quickly as we expected.”  One of the principal reasons for this was Obama’s $8,000 home-buyer tax credit in 2009 and 2010 that, like all Keynesian-style narcotics, juiced the market temporarily, but had the effect of prolonging our pain by delaying the necessary adjustment of housing values to their intrinsic level.  Now the Administration is said to be “ramping up talks on how to revive the housing market.”

Here’s a suggestion.  How about just staying out of the way.  Just stop.  And follow Harding’s lesson in reducing debt, too.  I know, the thought Obama could be half the president Harding was is too much to ask.

FINALLY YET MORE ON TAXATION FROM JENIFER RUBIN ON REP. RYAN'S PLAN

Once again, Paul Ryan takes on Obama

By Jennifer Rubin

Rep. Paul Ryan (R-Wis.) again and again has proved himself to be the most effective proponent of conservative economic principles.

Last night he sent around to budget committee colleagues a memo, a copy of which was obtained by Right Turn, setting forth some key facts and arguments. His central point is that “balance” doesn’t require tax hikes. As he puts it, “The House already passed a budget that puts us on the path to balance, and will vote next week on a Balanced Budget Amendment. To get to fiscal balance, the two critical elements required: spending restraint and economic growth. Tax hikes adversely undercut both of these key ingredients.”

The memo then provides some much needed context for the arguments on the debt ceiling:

A “Balanced Plan”?

l During the past two years Democrats enacted huge tax increases (see today’s Wall Street Journal editorial, “Taxes Upon Taxes”), which were accompanied by unprecedented increases in spending, deficits, and debt.

l While insisting on additional tax increases, the Obama Administration opposed revisiting the huge spending increases in the new health care law or implementing fundamental entitlement reform that would get spending on these programs under control.

l The last time there was a bipartisan budget agreement, it balanced the budget by cutting spending and cutting taxes. The 1997 bipartisan budget agreement between President Clinton and a Republican Congress balanced the budget by bringing spending down to 18.2% of gross domestic product.

Taxes and Revenues (Americans are not under-taxed)

l Expiration of 2001/2003 Tax Relief. Taxes will rise by $3.5 trillion if the 2001/2003 tax relief, the AMT patch, and the estate tax compromise expire at the end of 2012 as scheduled under current law.

l Health Care Law’s Tax Increases. The health care bill adds another $813 billion in taxes over 10 years. In addition to these taxes, other legislation has increased taxes (the SCHIP extension law included tax increases of $75 billion).

l Tax Engineering. The Obama Administration wants to extend the one-year temporary payroll tax cut (total cost of $112 billion), while increasing taxes on small businesses.

l Tax Increases and the Top Rate. As a result, these tax increases push the effective top rate from 35% today to 44.8%.

l Current Tax Burden. Under current law (before expiration of 2001/2003 tax relief and implementation of the new health care taxes), the top 1% of income taxpayers (over $380,000 in annual income) already pay 38% of income taxes. The bottom half of income taxpayers pay 3% of income taxes.

l Revenues Growing Without Tax Increases. Despite a weak economy and the temporary reduction in Social Security taxes, according to CBO, revenues grew by 8.5% through the first 9 months of this year and expect revenues in 2011 will be $75 billion to $85 billion higher than they estimated in March.

l Republican Budget & Revenues. Under the House Republican budget, which extended tax relief and repealed tax increases in the new health care law, revenues still grow by nearly $2 trillion over the next 10 years.

l President’s Budget & Tax Increases. The President’s budget increases taxes by $1.2 trillion.

Democrats and the left punditocracy often argue that “all” President Obama wants is to go back to the Clinton tax rate. If only. And if we are to take Sen. Kent Conrad (D-N.D.) seriously, Senate Democrats want a$2 trillion tax increase.

Ryan makes the case that the problem is spending and the ensuing debt, neither of which Obama is willing to seriously address:

Spending is the Problem

l 24% Increase in Base Spending. Non-defense discretionary spending grew by 24% for the first two years of the Obama Administration, adding $734 billion in spending over the next 10 years.

l Health Care Law Spending Increases. The new health care law included $1.4 trillion increase in spending, including expanding eligibility in Medicaid by one-third and creating a brand new health care entitlement.

l Stimulus. CBO currently puts the stimulus bill’s cost at $821 billion.

l Record Total Spending. The Federal government will spend $3.6 trillion this year, 24% of gross domestic product (GDP) and the highest burden on the economy since World War II. Spending has historically averaged a little over 20% of GDP.

l President’s Budget & Spending. According to CBO, the President’s budget never spends below 23% of GDP and by the end of the decade is right back at 24% of GDP.

l Republican Budget. The House Republican Budget would cut $6.2 trillion in spending from the President’s budget.

Deficits and Debt

l $1 Trillion Deficits. The deficit is on track to exceed $1 trillion this year, the third year in a row that deficits have exceeded $1 trillion.

l President’s Budget & “Framework.” According to CBO, under the President’s budget, annual deficits never fall below $700 billion and end the decade exceeding $1 trillion. When asked about the President’s April 13th new budget framework, Director Elmendorf testified, “We don’t estimate speeches.”

l Debt Explosion. Since President Obama took office, the total debt has grown from $10.6 trillion to $14.3 trillion, nearly a $4 trillion increase. This year total debt will exceed the size of the economy.

l Republican Budget. The Republican budget reduces the deficit by $4.4 trillion, puts the budget on a path to balance, and begins to reduce debt held by the public as a burden on the economy by 2014.

The president in public wants to operate on platitudes and generalities.Work together. A balanced approach. Eat your peas. The White House is avoiding specifics for a reason: The facts reinforce the public’s sense that the real issue is that we are spending too much. Republicans would do well to speak in specifics and to emphasize that real “balance” means spending at a slower rate (you’d think Ryan’s plan would actually halt the upward climb in spending; it merely restrains it a bit more than Obama’s) and keeping the size of the public sector in check so the private sector can grow and create jobs.

Once again we see that Ryan is the most effective spokesman and advocate for Republicans, in part because he is thoroughly versed in the details. Imagine if he were to debate Obama. In the fall of 2012. On national TV. With the presidency at stake. Is there any doubt who would come off better?

NYTimes bias II

For a compendium of examples of the NYT's liberal view of the world and links to comments on their latest excoriation of the right wing media,  here is an excellent piece by Scott Johnson of Powerline.  It's not an exaggeration to say hypocrisy and liberalism are like Frick and Frack and go together like and hand in a glove.

Dodd-Frank, the real culprit according to Robert Tracinski of TIA Daily

 In this article Tracinski blames the Dodd-Frank financial reform act for the uncertainty and confusion in financial quarters that has impeded and virtually stopped the flow of credit necessary for a real recovery to begin.  Tracinski offers no solutions to the implosion on Wall Street that led to our current dilemma but suggests that the Dodd-Frank bill is simply making things worse inasmuch as it blames the financial collapse on venal bankers and proposes bureaucratic means of controlling them in the future.  It is this expansion of the administrative state that democrats so love that keeps the recovery at bay since the rules and regulations required by the new law have yet to be written and agree upon by regulators.  Tracinski sees us as about half way through this process.  But even so once the process is completed, things are not likely to get any better because the rules (already in place in some cases) are so vague as to continue to lead to uncertainty and therefore inaction by the banks to begin extending credit more freely once again.  In Tracinski's view once again the political class has succeeded in shifting the blame for the crises to the private sector and is proceeding to make things worse by further restricting the financial industry from doing its job.  All in all this is a fairly lucid explanation of what's happening now without shedding much light on what would be effective to prevent another such crises in the future short of keeping the government from making things worse, as it always manages to do.

Seven years of near madness -- Victor Davis Hanson

VDH has succinctly summarized here the second Bush term, the irrational behavior of the left media and politicians, the rise and election of Obama and the return to reality in 2010.  As is his wont, Hanson brings the historian's perspective to recent history.  After all his recounting and analysis of this period, one is left to wonder exactly what caused the left to become thoroughly unhinged and irrational.  He offers the partial explanation that after years of out of power they saw the opportunity to  rally voters around the unpopularity of the prolonged conflict in Iraq conveniently forgetting that they had agreed with Bush about going into that country and all the rest.  As they always do, the democrats, with no principles other than the exercise of power, turned the full fury of their captive media and academia against the republicans giving us in the process the Hope and Change presidency.  If Obama is reelected all bets are off on the future of the US, at least as the country we have known in the past.