Archive | Bailout Watch
The nation is not only facing an economic crisis, it’s facing a moral and Constitutional crisis. Fears of Wall Street’s collapse have Washington politicians fighting for their political lives, and it may cost the United State dearly. Nearly a trillion dollars in bailouts have been proposed along with hastily planned additional layers of regulation. The biggest takeover of the private sector by government is on the horizon. But big questions aren’t being addressed by the President or Congress. The biggest question: “What was government’s role in this crisis?” At CEI, we believe that over-regulation, government sponsored entities like Freddie Mac and Fannie Mae, and a series of ill-conceived government housing programs have contributed greatly to the current crisis. To make sure the free market voice is heard, CEI is taking on the bailout through podcasting, blogging, and traditional media. Read more on Bailout Watch here.
This morning I read with interest - and amazement - the above headline. Does our president live in the same world that I inhabit? He’s worried about America’s increasing indebtedness and is pushing for a massive expansion of health entitlements (aka wealth redistribution programs) and the cap-and-tax global warming initiatives (aka wealth redistribution programs) and a host of other other wealth-destroying regulatory programs. Yet, he’s worried about America’s growing debt?
Our political system is only now perhaps emerging from a foolish…
Read the full story
Federal affordable-housing mandates were a major factor in the mortgage crisis, fueling the housing bubble and the subsequent collapse of the housing and financial markets, which helped bring down the economy. Even the liberal Village Voice has admitted that. Who drafted those awful mandates? ACORN, reports the Washington Examiner, in “How ACORN Destroyed the Housing Market.”
How did ACORN cause the “housing bubble” and “financial collapse”? ACORN lobbyists drafted “affordable-housing” mandates to pressure the mortgage giants to buy up more risky loans and mortgages…
Read the full story
The House is voting today on a bill to improve transparency in the TARP bailout program. TARP is, shall we say, rather opaque. 25 different agencies administer TARP funds. Each one uses different accounting standards. Keeping track of everything is almost impossible.
I wrote an article not too long ago saying that transparency is welcome symptomatic relief. But TARP itself is a disease. The only way to cure the disease of bailout programs is to abolish them. Russ Roberts said much the same…
Read the full story
by Fred Smith
November 09, 2009 @ 6:31 pm
The Washington Times, “Greedy Autoworkers,” editorializes the overwhelming rejection of the UAW’s proposed labor agreement. Unlike GM and Chrysler, Ford elected to reject the bailout money and benefited from the consumer distrust of our newly nationalized auto sector. Yet, Ford actually went into the black this past quarter. GM and Chrysler, operating as GSEs, are safe from strikes because the government takeover agreement forbids the UAW to strike. Big Government is willing to discipline Big Labor. In the market, odds shift and…
Read the full story
Russ Roberts’ testimony in front of the House Committee on Oversight and Government Reform is superb. Read it (it’s short). Wall Street deserves plenty of blame for the financial crisis. But Washington deserves more:
When your teenager drives drunk and wrecks the car, and you keep giving him a do-over—
repairing the car and handing him back the keys—he’s going to keep driving
drunk. Washington keeps giving the bad banks and Wall Street firms a do-over. Here are
the keys. Keep driving. The story always…
Read the full story
The federal government has no problem paying exorbitant sums of money to people who head failed government agencies like Freddie Mac. Its CEO will receive compensation estimated at $5.5 million. The Federal Housing Finance Agency took direct control over Freddie Mac, a government-sponsored enterprise, after it ran up tens of billions of dollars in red ink buying risky mortgages, without adequate capital reserves. At the direction of the Obama administration, Freddie Mac is now running up $30 billion in losses to…
Read the full story
Question: What do you get when you combine a $700 billion “stimulus” package, $1.1 trillion in wealth-destroying regulatory compliance costs, a mountainous non-discretionary entitlement obligation, bailouts for large manufacturers, an small army of unelected czars, and a $1.4 federal budget deficit?
Answer: Way too much government!
In a new CEI paper, One Nation, Ungovernable?, Clyde Wayne Crews lays out an agenda for setting America on the path to economic recovery. From lifting burdensome regulations and restrictions on executive compensation to fostering competition and…
Read the full story
by Hans Bader
October 23, 2009 @ 4:37 pm
The mortgage meltdown was caused partly by the government, which created an artificial market for bad mortgages. The Washington Examiner cites a recent study by Peter Wallison, who had prophetically warned about risky financial practices for years, finding that two-thirds of all bad mortgages were either “bought by government agencies or required to be bought by private companies under government pressure.” Now, the Federal Housing Administration is ramping up its purchases of low-quality mortgage loans, threatening taxpayers with hundreds of billions of dollars…
Read the full story
The mortgage meltdown was caused partly by the government, which created an artificial market for bad mortgages. The Washington Examiner cites a recent study by Peter Wallison, who had prophetically warned about risky financial practices for years, finding that two-thirds of all bad mortgages were either “bought by government agencies or required to be bought by private companies under government pressure.” Now, the Federal Housing Administration is ramping up its purchases of low-quality mortgage loans, threatening taxpayers with hundreds of billions of dollars…
Read the full story
Bank of America recently announced that it will impose annual fees on some of its cardholders. This is in response to the CARD Act (Credit Card Accountability Responsibility and Disclosure Act of 2009), which effectively shifts costs to responsible people from irresponsible people, forcing banks to increase charges to responsible credit card holders.
The CARD Act has also wiped out many cash-back and rewards programs and rebates on credit cards, something earlier chronicled here. Despite that fact, its passage was trumpeted by President Obama…
Read the full story
Veteran political commentator Michael Barone reports that liberal congressional leaders are pushing policies to “inflate the housing bubble again,” even though “our financial system broke down because we had, thanks to government policies, a housing bubble.”
Congressional leaders are ignoring warnings from experts across the political spectrum, such as conservative Peter Wallison’s October 16 piece in the Wall Street Journal, titled “Barney Frank, Predatory Lender,” and liberal Charles Lane’s recent piece in the Washington Post, “Doubling Down On the Wrong Housing Policy.” (Wallison, a banking expert, prophetically…
Read the full story
George Mason University Professor Ilya Somin explains how the Obama administration is expanding the awful policies that caused the mortgage crisis, like having taxpayers effectively underwrite risky-mortgage loans by bailing out GSEs at a cost of hundreds of billions of dollars. Now, the administration is stepping up Federal Housing Administration subsidies for risky, junky mortgage loans that are likely to default in large numbers.
(The Obama administration doesn’t seem to have learned history’s lessons overseas, either. White House Communications Director Anita Dunn cites as…
Read the full story
Detractors of capitalism decry that it caters to special interests. The opposite is actually true. Just look at what’s happened in the last year.
Most of Wall Street came to government asking for a bailout when the government-created housing bubble popped.
The Big Three automakers also went to Washington for largesse when their customers came to prefer Toyotas and Hondas.
Health insurance companies stand to make a killing if Obamacare passes.
T. Boone Pickens and Al Gore would make millions from environmental legislation.
Ludwig von…
Read the full story
Unemployment has risen to 9.8 percent, a 26-year high.
That’s much higher than the Obama administration predicted unemployment would rise, if Congress had refused to pass his $800 billion stimulus package. The administration claimed unemployment would rise to 8 percent without a stimulus.
Small businesses are finding it more difficult than ever to borrow badly needed money to meet their payrolls. New financial regulations backed by the administration are contributing to a terrible credit crunch. Meanwhile, the wealthy Wall Street investment bank Goldman Sachs, perhaps the…
Read the full story
Tomorrow, 7-Eleven Inc. and other big retail chains will hit Capitol Hill to offer Congress members and their staffs a supersize serving of hypocrisy. Retailers, who rightly complain about costly government mandates in health care and other areas, are now calling for Congress slap price controls on the interchange fees they pay to banks and credit unions for services associated with the credit and debit cards of retail consumers.
7-Eleven has fine stores that offer many conveniences to their customers, but…
Read the full story
Journalists have a tendency to present overly-simple explanations of current events that often turn out to be completely false as well. Part of this is due to journalists trying to present a clear, digestible story to readers, and part is due to the fact that most of them have no formal training or particular expertise on the subjects they write about. Case in point is Barry C. Lynn’s latest piece in The American Prospect, which alleges that concentration of the auto…
Read the full story
While Obama ally ACORN attempts to gag whistleblowers who exposed its role in a recent scandal, the Obama administration is trying to gag critics of its health-care plan, which the Congressional Budget Office says could wipe out many Medicare Advantage programs relied on by the elderly. (”The Obama Administration wants to seriously curtail or end Medicare Advantage.”)
It has issued a gag order to Humana, a health insurer that provides Medicare Advantage services, ordering it not to tell customers about how Obamacare could reduce the availability of…
Read the full story
In his 2008 campaign, Barack Obama talked a lot about “bipartisanship,” but in office, he has governed from the far left, on both domestic and foreign policy, by meddling overseas in favor of left-wing would-be dictators, and at home in support of powerful left-wing unions, at the expense of taxpayers, airline security, the Constitution, and the rule of law. (One possible exception to his left-wing path is his support for the obscene Wall Street bailouts, which disgusted left and right…
Read the full story
People are often surprised to hear how similar President Obama’s policies are to President Bush’s. They shouldn’t be. One may be a Republican and the other a Democrat, but make no mistake. Bush and Obama are two peas in a pod:
-Bush signed a $700 billion bank bailout bill. Obama continued the policy. And he extended it to other sectors, such as the automobile industry.
-Bush tried fiscal stimulus twice while in power. With some help from the Bush team, Obama oversaw the…
Read the full story
The global-warming industry would probably still be solely owned by assoted cranks and romantics (and the odd vice president) if it weren’t for a bunch of CEOs taking a leaf from Enron’s playbook and attempting to monetize the issue. Playing the bootleggers in a classic bootleggers and baptists alliance, these businessmen have realized that they can get the government to increase their profits by means of “cap and trade” and similar regulatory interventions, at the expense of other businesses and the paying…
Read the full story
Loading ...