Ron Paul is considered by many to be a flake (myself included at times). But he was 100% right about one thing, folks. The fellow totally predicted the housing/financial crisis. Here is a portion of his direct testimony before the House Financial Services Committee on September 10th, 2003 (forewarning us on the destructive consequences that an unchecked Fannie and Freddie would eventually level on the U.S. economy)............: "Ironically, by transferring the risk of a widespread mortgage default, the government increases the likelihood of a painful crash in the housing market. This is because the special privileges granted to Fannie and Freddie have distorted the housing market by allowing them to attract capital they could not attract under pure market conditions. As a result, capital is diverted from its most productive use into housing. This reduces the efficacy of the entire market and thus reduces the standard of living of all Americans.
Despite the long-term damage to the economy inflicted by the government's interference in the housing market, the government's policy of diverting capital to other uses creates a short-term boom in housing. Like all artificially-created bubbles, the boom in housing prices cannot last forever. When housing prices fall, homeowners will experience difficulty as their equity is wiped out. Furthermore, the holders of the mortgage debt will also have a loss. These losses will be greater than they would have otherwise been had government policy not actively encouraged over-investment in housing."............I ask you, folks. Compare this testimony of Mr. Paul's to that of dullards like Barney Frank and Maxine Waters (circa the same time) and tell me, who's the real flake now?
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So you are letting the banksters off the hook and blaming the dynamic duo,Freddie and Fannie, instead?
There are a whole host of villains, Jerry; Greenspan, Bush, Clinton, etc.. If I had to pick the one/worst, though, I'd probably have to go with Franklin Raines. At least from what I can gather, a major portion of the toxicity has his fingerprints written on it.
And the bankers (not to necessarily absolve them, mind you) were basically just doing what the government agencies wanted them to do - extending more in terms of home ownership.
The banksters were only doing what the government agencies Freddie and Fannie were encouraging them to do. Sure, the banksters didn't have to do it, but Freddie and Fannie made irresponsible lending by the banks lucrative and risk-free.
Ah yes, Franklin Raines. A government employee who raked in many millions a year in order to do a very bad job.
And yes, Will, in response to your last comment. This was not a problem caused by lack of government regulation/intervention. It was instead caused by destructive government regulation. No Freddie or Fannie? The crisis would have been hardly much at all.
I will say that this post is awkwardly timed with his comments on the hurricane reflief.
Will: Compare this testimony of Mr. Paul's to that of dullards like Barney Frank...
What the hell are you talking about Will? Barney Frank deserves credit for seeing (and trying to warn Congress) of the potential danger of a deregulated subprime lending market.
Rep Frank says, "I worked together with Republican Chairman Mike Oxley on the only bill that the Republicans considered during that period to restrict Fannie Mae and Freddie Mac, and the bill was defeated because, in the words of Mr. Oxley, the Bush administration gave his efforts the one-finger salute" [the bush administration and the Republican controlled House BLOCKED Rep Frank and colleague's efforts in reign in F&F]..
Will: There are a whole host of villains... [the] worst [is] Franklin Raines.
And you'd be dead wrong with your selection of him as the worst. The worst were Greenspan, Gramm, Clinton and the bush administration. They were the ones who pushed for, authored and signed the deregulatory legislation that set up the housing bubble.
Then the bush administration stepped in and took advantage of the deregulation to push their "ownership society" BS in a successful attempt to enrich their Wall Street buddies.
How the hell can someone who merely took advantage of the deregulation be MORE to blame then those who deregulated? Your selection of FR as worst makes absolutely no sense!
dmarks: No Freddie or Fannie? The crisis would have been hardly much at all.
This is utter and complete nonsense. Economist Dean Baker says pinning the financial meltdown on Fannie and Freddie is, "obviously not true".
According to Baker, "Fannie and Freddie got into subprime junk and helped fuel the housing bubble, but they were trailing the irrational exuberance of the private sector. They lost market share in the years 2002-2007, as the volume of private issue mortgage backed securities exploded....
In short, while Fannie and Freddie were completely irresponsible in their lending practices, the claim that they were responsible for the financial disaster is absurd on its face".
Will: But [Ron Paul] was 100% right about one thing, folks. The fellow totally predicted the housing/financial crisis.
No, he didn't. F&F didn't cause the housing bubble. Like dmarks Mr. Paul saw one of the symptoms of the Conservative-championed deregulation (signed by Conservative Democrat Clinton) and wrongly concluded it was the cause.
The only thing I'd give Ron Paul credit for is perpetuating the myth dmarks believes in... that "this was not a problem caused by lack of government regulation/intervention. It was instead caused by destructive government regulation".
Nothing could be further from the truth.
I have a suggestion, wd. Instead of quoting after-the-fact press-releases from Mr. Frank and his handlers, you actually quote Mr. Frank's testimony during these 2003-2004 hearings. The man was absolutely clueless. How clueless was he? He was so clueless that even a partisan as far out on the extremes as Alec Baldwin recognizes that Mr. Frank let us down. Alec frigging Baldwin!!
And wd, the bankers were doing EXACTLY what the Federal government (the philosophy of loosening lending standards basically permeated all levels of government) and it's central bank wanted them to do. How does that constitute deregulation?......And Fannie and Freddie WERE major players. They, along with the Department of Housing and Urban Development (Henry Cisneros - yet another villain) and the Fed, were constantly trying to push for a loosening of lending standards. The record is the record, dude.
"signed by Conservative Democrat Clinton)"
Actually, in fact Clinton was a liberal Democrat. No need for you to rewrite history.
And yes, read what Will wrote. F&F, which are government agencies, were the major cause and trigger of the meltdown. And they did this through over-regulation (not lack of regulation). Specifically policies to force banks to behave badly.
We would do well to remember how Barney Frank and other liberal Democrats resisted efforts from Republicans to stop F&F from doing this.
Google
barney frank fannie mae regulation
and educate yourself about the history and origins of this significant fiasco.
dmarks: educate yourself about the history and origins of this significant fiasco.
Actually, I did educate myself on the topic by writing several posts on the topic for my blog (and doing a lot of research in the process).
What I found is that the spin you've swallowed is completely false. DEREGUALTION caused the housing bubble, and F&F, while participants, absolutely were NOT the major cause or trigger of the meltdown.
BTW, Clinton most certainly was a Conservative Democrat. The fact that he signed the deregulatory legislation that caused the financial crisis PROVES this!
Finally, Barney Frank did warn Congress that F&F might be a problem. The bush administration and the Republican-controlled congress ignored him... because they saw an opportunity to make a pile of money (and if things went wrong they knew the government would bail them out).
I think you need to educate yourself regarding the facts and stop blindly following the Republican spin on this dmarks.
"Clinton most certainly was a Conservative Democrat. The fact that he signed the deregulatory legislation that caused the financial crisis PROVES this!"
A left-wing liberal democratic President occasionally signs legislation you don't like. This proves nothing.
"...and stop blindly following the Republican spin on this dmarks."
You are once again resulting to hollow baseless insults. I haven't referred to any Republican spin. So you are pulling this out of thin air.
The last reference I recall casually coming across on the media referring to this was when NPR News, during "All Things Considered", mentioned how F&F caused the meltdown as background to one of their current new reports. This was news, not commentary. And NPR is hardly "Republican spin".
Regulation caused the housing bubble. Specifically, the regulator behavior through F&F which forced banks to behave irresponsibly.
From the Village Voice, again hardly Republican spin.
"There are as many starting points for the mortgage meltdown as there are fears about how far it has yet to go, but one decisive point of departure is the final years of the Clinton administration, when a kid from Queens without any real banking or real-estate experience was the only man in Washington with the power to regulate the giants of home finance, the Federal National Mortgage Association (FNMA) and the Federal Home Loan Mortgage Corporation (FHLMC), better known as Fannie Mae and Freddie Mac. "
This instance of bad government regulation "tells us about how we got in this hole"
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WD, you are the only one bringing any kind of "spin" into this, and you are likely the only one wrapped up in it, also.
wd, show me one piece of testimony (actual in-time testimony) in which Barney Frank warned ANYBODY about the perilous state of Fannie and Freddie. I'd really like to see one (this, in that every piece of in-time testimony that I've seen has him saying the opposite; that Fannie and Freddie were absolutely peach-keen).
dmarks, wd is psychologically incapable of accepting any liberal culpability in this or any other issue.......Van Jones was never a 9/11 truther. ACORN never petitioned the State of California to pay their worker below minimum wage. Michael Moore hires lots of African-Americans. And Nancy Pelosi hires lots of union personnel. This is the alternative world that he lives in.
On WD's "...Conservative Democrat Clinton..."
WD, I'd like you to meet this guy. He thinks Bush is a socialist. You two have a lot in common. In particular, you have a radical fringe view of political definitions that you both are so incredibly wide of the mark in describing the politics of past Presidents. You both are incapable of steppingout side of your personal "I am the real political center; everything to the side of me is an extreme" viewpoint. How else can anyone call Clinton a Republican, or Bush a socialist?
Will said: "...Van Jones was never a 9/11 truther...."
Never mind that. Van Jones' views are the worst of the worst, at least as bad as Nazism. He's a Maoist. You know, the political ideology that demands execution of a large percentage of the population in order to achieve political reform. He's the equivalent of David Duke. Based on his professes political ideology, he's the kind of guy who could look around a crowded room and think of who he'd send to the death camps if he were leader.
Will: dmarks, wd is psychologically incapable of accepting any liberal culpability in this or any other issue.
Bullshit. I assign blame where it is due. I have no psychological incapability. Van Jones said he didn't sign the petition and I believe him. Although I would not care if he had. It's a non-issue as far as I am concerned because I don't give a shit either way.
I don't know how many African Americans Michael Moore hires. I do know the guy who wrote that liberal hypocrisy book is a liar and Michael Moore is a good man and not a racist. But I don't flat out deny that one... I'd say I don't have enough info to determine what the truth is.
What you say I believe about Nancy Pelosi is a flat out lie. You know it, and if you have any integrity you will retract it. Her vineyard isn't unionized so OF COURSE she doesn't hire union members.
As for ACORN, it appears as though they did do that, but that was under the old management. Apparently they had some problems before Bertha Lewis took over.
As for YOU, clearly you are psychologically incapable of not getting on your high horse and proclaiming yourself superior to those who have opinions that differ with yours.
dmarks: Never mind that. Van Jones' views are the worst of the worst, at least as bad as Nazism.
Now you're just making stuff up for the hell of it. Everything you said about him is a lie. Personally, I've got nothing but deep respect and profound admiration for Mr. Jones.
dmarks: I'd like you to meet this guy. He thinks Bush is a socialist.
bush wasn't a socialist. Unless you're talking about socialism for the rich. Which is what the deregulation bills Clinton signed were all about... enabling the rich bankers to get even richer.
Bill Clinton WAS NOT A LIBERAL!!! Disagree with me if you like about him being conservative, but it's common knowledge that he was a THIRD WAY Democrat. The third way BY DEFINITION embraces Right-wing economic policies!
According to the DLC website, "Starting with BILL CLINTON's Presidential campaign in 1992, Third Way thinking is reshaping progressive politics throughout the world..."
Also, according to Wikipedia "The Third Way refers to various political positions which try to reconcile right-wing and left-wing politics by advocating a varying synthesis of RIGHT-WING ECONOMIC and left-wing social policies..."
A Liberal, BY DEFINITION, would NEVER advocate "a varying synthesis of right-wing economic and left-wing social policies".
You continuing to call Clinton a Liberal is utterly moronic.
wd, give me one specific lie that Mr. Schweizer told. He accused Mrs. Pelosi of not hiring union pickers for her vineyard AND SHE DIDN'T. No lie there. He accused Michael Moore of only hiring 3 African-American producers/directors out of over 100 (this, after Mr. Moore criticized the industry as a whole for only hiring 5% African-Americans). No lie there. What do ya' got? It sounds like nothing to me.
Will: wd, give me one specific lie that Mr. Schweizer told.
I already did. Go back and read my prior comment on this topic. You pretending I didn't doesn't mean Peter isn't a liar.
He did not lie about Pelosi. You're lying. He accused her of not hiring union pickers and SHE DID NOT. No lie.
WD said: "Now you're just making stuff up for the hell of it. Everything you said about him is a lie. Personally, I've got nothing but deep respect and profound admiration for Mr. Jones."
Actually, you've done no research into this. Van Jones was a member of STORM, and explicitly Maoist hate group. This is a prime example where you are saying something just because it sounds good to you but you've never researched it.
I can no more admire Jones than I can admire David Duke. They are cut from the same cloth.
"Bill Clinton WAS NOT A LIBERAL!!!"
You can continue to redefine political definitions all you want. Or at least attempt to. But all the !!! in world won't change the facts of Bill Clinton being a liberal Democrat.
"You continuing to call Clinton a Liberal is utterly moronic."
I am not 'Calling' him a liberal. I am merely pointing out the fact that he is one. A large number of liberals embraced the 'Third Way'.
Denying Clinton is a liberal is exactly the same as denying that Obama was born in the US. Sure, there's a tiny few who have no idea what they are talking about who will insist on one or the other. But.. come on, get real.
My feelings on Clinton are that the guy was basically whatever he needed to be AT THAT MOMENT. If he was talking in front of a bunch of liberals, he'd pull out that bag of tricks. If he was talking in front of a bunch of conservatives, he'd pull out that bag of tricks. Quite frankly, fellows, I'm still not entirely sure what he was. If I HAD TO put a political label on him, I'd probably have to say that he was more or less a centrist. I wouldn't bet the farm on it, though (realizing, of course, that one's perceptions are largely determined by where they themselves are on the political spectrum).
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