For your consideration; Chuck DeVore, republican candidate for Senate is the most conservative candidate among the republican primary field in California. Glenn Beck will be interviewing Chuck on Monday’s program, and I will be posting that show. I look forward to comments about Mr. DeVore from LM’s California readers.
Mr. DeVore on the issues.
Who will bailout the taxpayers?
By Chuck DeVore
Monday, September 22, 2008 at 5:50pm
One trillion dollars and counting – about $3,300 in new debt for every person in America – this is the price of bailing out Wall Street, we are told by our leaders.
I’m not buying it. Since when was it my responsibility to clean up someone else’s financial mistakes? Is it now my job, as a taxpayer, to assume risk in all situations, whether it’s to rebuild coastal cities in hurricane-prone areas, pay farmers for crop damage, or help someone stay in a house they cannot afford that they bought with a risky loan that should not have been made backed up by my tax dollars?
America was built on the free market with its attendant risk and reward. Our leaders appear intent on replacing the risk portion of that formula with regulation, debt, and taxation. Instead of “risk and reward” we’ll have “reward failure” and America will be the poorer for it – much poorer.
That this current mess started with government-created and taxpayer-backed mortgage giants Fannie Mae and Freddie Mac is telling. Even more telling is that Fannie Mae’s former CEO, Franklin Delano Raines (”FDR,” how appropriate), settled civil charges for $25 million that he illegally overstated Fannie Mae’s earnings by more than $7 billion resulting in his getting multi-million dollar bonuses. Not surprising that FDR served Bill Clinton as White House budget director from 1996 to 1998. Also not surprising is that the Washington Post reported in July that FDR was advising Barack Obama on “mortgage and housing policy matters.”
It’s not like we didn’t see this crisis coming. The Securities and Exchange Commission (SEC) accused Fannie Mae of overstating earnings almost four years ago now, then initiated a civil complaint more than two years ago – showing the world that SEC Chairman Chris Cox was doing his job long before Washington, D.C. took serious notice.
The problem in this current crisis is not a lack of regulation. Rather, it is that our government encouraged bad loans backed up with our tax money. The whole subprime fiasco had its roots in leftwing complaints about the mortgage industry’s so-called “redlining.” Banks refusal to lend to people with bad credit, a poor employment history, and low earnings looked to liberals an awful lot like banks refusing to lend to minorities. Hence, the subprime market was born – then, when financial institutions saw how much money they could make on these risky loans, they went wild – pushing the housing market into overdrive as homeownership rates hit all-time highs. In the end, millions of people who, with a real assessment of risk, would have remained renters, qualified for loans.
Now the bidding war has commenced in Washington, with Democrats insisting that any bailout of mortgage tycoons and financial bosses get larded up with billions more for homeowners in over their heads.
Heck, with our politicians wanting to assume all risk I think I should buy a 15-bedroom mansion sitting on a 500-acre sugar plantation outside of New Orleans. Then when a hurricane hits I can get federal relief for my ruined crop, my damaged house, and my defaulting loan. After all, why should I take the hit on a risky failure when my fellow taxpayers are there to help me?