The bankrupting of the nation for political gain

The bankrupting of the nation for political gain

The following is based in part on excerpts from an article by Cliff Kincaid for Accuracy in Media.

A lot will be said and written about the presidential election, but one central fact remains: John McCain was ahead in the polls until the financial crisis emerged and President Bush was pushed by Treasury Secretary Paulson into seeking a $700-billion Wall Street bailout on Sept. 18. The crisis benefited Obama, even though he voted for the bailout, because he was not a Republican, like McCain or Bush. Republicans were blamed because a Republican was in the White House.


The exit polls on Nov. 4 still found the public opposed to the bailout by a 56-39 percent margin.

The panic around mid-September infected the Mainstream Media and even the conservative media, especially Fox News, which became a soapbox for the bailout that now exceeds $1.8 trillion. But rather than bail out or “rescue” anything, the hastily-passed measure, ironically named the “Emergency Economic Stabilization Act of 2008,” started a process that now threatens national bankruptcy.

Because Wall Street has gotten its bailout, the Democrats figure that they can now spend even more, supposedly to benefit Main Street. Which means spending and debt will get even more out of control and more socialist measures, this time under President Obama, will be taken.

The Global Europe Anticipation Bulletin, which predicted the current financial crisis, is warning that the U.S. government will default on its debts by the summer of 2009 and that the “unfolding implosion” of the U.S. economy will result in the dramatic decline of America as a world power.

This is not a natural disaster, like a hurricane or earthquake. It has been brought about by reckless decisions made by people on Wall Street and in the federal government, including Congress. It was man-made, [but] the media has not demanded accountability for how the Bush Administration and the Congress permitted the nation to come to this point?

Incredibly, we still know very little about what happened behind closed doors. Rep. Scott Garrett, Republican of New Jersey, is one member of Congress who wants some answers. One White House official simply shrugged his shoulders when I asked him how this crisis just happened to emerge six weeks before the election. Either they don’t know or don’t care to know, and who from the media are asking any questons?

We do know that the powerful pro-China investment banking firm of Goldman Sachs, which backed Obama and the Democratic Party, has its fingerprints all over this debacle. Not surprisingly, the firm now benefits (so far to the tune of $10 billion) from the “rescue” package forced through Congress by its former chairman, Henry Paulson, and even got $5 billion from Obama booster Warren Buffett.

This would not pass the smell tests were the circumstances and the players different.

It was Paulson, let us not forget, who pushed this deal through as the U.S. Secretary of the Treasury in a Republican administration. His solid Democrat credentials have protected him from the scrutiny of a press corps that has lost all curiosity for anything resembling scandal unless a conservative Republican happens to be involved.

Meanwhile, even before the election results were in, Kimberly A. Strassel of the Wall Street Journal was urging the Republicans “to start elevating the new generation of reformers, folks like Virginia Rep. Eric Cantor or Wisconsin’s Paul Ryan” in the House. She called them intellectuals, never mentioning the fact that they backed the Wall Street bailout that her colleague, Stephen Moore of the Journal’s editorial page, now admits was a big mistake. “I want to apologize,” Moore said. “I drank the Kool-aid.”

Cantor and Ryan, a member of the House Budget Committee, were good conservatives until they drank the Kool-aid and backed the bailout. Now they have lost their credibility on fiscal issues.

Of course, there were a lot of Kool-aid drinkers in Congress, including House Minority Leader John Boehner, Minority Whip Roy Blunt, Cantor, and House Republican Conference Chairman Adam Putnam of Florida. However, in the end, most House Republicans opposed the bailout, objecting to its socialist nature and questioning whether it would even work. By any objective measure, they were right. It hasn’t “stabilized” anything.

This is critical to note: all of the House Republican leaders, including Cantor, Putnam, Blunt, and Boehner, supported the bailout. But they couldn’t get a majority of House Republicans to support them.

Putnam has now resigned as chairman of the House Republican Conference, and Rep. Jeb Hensarling of Texas, the chairman of the conservative Republican Study Committee who opposed the bailout, will run for that post.

Blunt may resign, and Cantor is said to want that post. Boehner says he will seek to remain in his position. On the Senate side, Republican Leader Senator Mitch McConnell not only voted for the bailout but ran for re-election on a platform of bringing home the federal pork to his constituents. He has also lost his credibility on spending issues.

Rep. Thaddeus McCotter, who called the bailout “Fleece in our time,” is beginning to receive more and more attention. He is the chairman of the House Republican Conference Policy Committee, the principal source of legislative initiatives for the party in the House. He won re-election in part because he came across as a leader in a revolt by House conservatives against Bush and Paulson over the bailout plan.

In a discussion with a local newspaper, McCotter was blunt, alluding to McCain’s double talk when he suspended his campaign to come to Washington to address the financial crisis. “McCain put himself in an interesting position,” McCotter said. “At the White House meeting, he said he liked what House Republicans were doing. Then the next day, he decided it was his job to get House Republicans to support the bailout.”

This erratic performance meant that McCain had blown any chance to exploit the financial crisis to his political advantage.

McCotter noted that it was a lot harder for McCain to complain about $70 billion in earmarks when he pushed for a $700-billion bailout. This sealed McCain’s fate, making his warnings about Obama’s socialism ring hollow.

Remaining true to his constituents and his own beliefs, McCotter rejected the notion that we need “just a little socialism to prevent a lot of socialism later” and said Republicans “abandoned principle for expediency” when they supported the bailout.

The same goes for the faux conservatives in the media.

One thing that I have realized, in analyzing the coverage of the campaign, is that the media are populated by many “conservatives” who are not really so conservative. It is a strange phenomenon. It is a form of false advertising.

This category includes the Fox News cheerleaders for the Wall Street bailout, such as Bill Kristol, Fred Barnes, Charles Krauthammer and Bill O’Reilly, and columnists David Brooks (New York Times), Peggy Noonan (Wall Street Journal) and Kathleen Parker (Washington Post Writers Group), who ridiculed Sarah Palin because she doesn’t enjoy the New York Times and appeals to ordinary people.


Chuck Schumer has a lot of explaining to do

Chuck Schumer has a lot of explaining to do

Thomas Lifson
Susan Schmidt of the Wall Street Journal has discovered a disconcerting coincidence: Senator Chuck Schumer took a highly unusual step of publicly criticizing a bank, sparking a run on it, just as big Democrat hedge fund donors were examining assets of the bank in hopes of buying them on the cheap should the bank fail.

Schumer of course denies any impropriety. But the odor from this is very, very bad. If a Republican had done something like this, the headlines and network news features would be screaming for his head.


Read the excellent article here. A few samples:


Sen. Schumer’s office said recently he didn’t know anything about Oaktree’s possible interest in IndyMac until after the bank failed. Oaktree Chairman Howard Marks said he never talked to the senator about IndyMac. [….]


The group of investors led by Oaktree are big political contributors, predominantly to Democrats. They have donated more than $700,000 to Senate Democrats and the Democratic Senatorial Campaign Committee during the four years that Sen. Schumer has chaired the campaign committee.


Oaktree’s Mr. Marks gave the Democrats’ Senate Campaign Committee $20,000 in late March. Executives of his firm and three other equity firms that considered investing in IndyMac along with Oaktree — Thomas H. Lee Partners, Ares Capital Management LLC and Fortress Investment Group LLC — have been generous donors to the DSCC under Sen. Schumer’s chairmanship, as have many Wall Street financial-services firms.


Mr. Marks said he is a longtime Democratic donor and has gotten fund-raising calls from Sen. Schumer. But, he said, “I know him socially. I’ve never talked business with him.” [….]


We were interested in taking a look,” said Mr. Marks. His firm has raised $11 billion this year to invest in distressed assets. “We’re bargain hunters. And we have a long history in distress,” he said.


The investors knew after a few days of due diligence in mid-June that they weren’t interested in buying the bank, said Mr. Marks. He read from a June 22 email from Oak Tree managing director Skarden Baker, who was assessing IndyMac’s business. “I am taking the view of doing enough here to jump in if it goes to receivership,” wrote Mr. Baker.


Four days after the email was sent, Sen. Schumer released publicly letters he sent to bank regulators and to the Federal Home Loan Bank of San Francisco. “I am concerned that IndyMac’s financial deterioration poses significant risks to both taxpayers and borrowers,” the senator wrote, warning that “the bank could face a failure if prescriptive measures are not taken quickly.”


Hat tip: Ed Lasky

The Rise of the United Socialist States of America



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Opposing view: The sky is not falling

Opposing view: The sky is not falling

By John Shadegg


Every Republican who voted against the Emergency Economic Stabilization Act on Monday believes that Congress must address this crisis. They take it seriously and stand ready to vote for reasonable legislation. They were unwilling to give Treasury Secretary Henry Paulson a blank check.

The sky is not falling. The market will return. Secretary Paulson is getting a lesson in civics. The world he has entered is different than the wheeling-and-dealing Goldman Sachs world where he made his fortune.

Members of Congress have a duty to protect the interests of the American people. That is precisely what they did. The vote against the measure was solidly bipartisan.

Paulson’s $700 billion dollar plan was fundamentally flawed. The bill asked for a blank check. It did not specify which assets could be purchased or the procedure by which they would be purchased.

Regrettably, Congressional Democrats inserted extraneous provisions and chose to put groups such as ACORN (a liberal housing advocacy group) and trial lawyers before the American people. After Sen. John McCain, R-Ariz., courageously halted the stampede, most negotiation time was spent removing harmful Democrat language, rather than improving Paulson’s proposal.

House Republicans want to protect the American people and our nation’s financial institutions, enabling them to make the loans needed to run America’s economy. It is also critical to calm public anxiety.

To begin, “mark to market,” the accounting rule that requires mortgage-backed securities to be valued at fire-sale prices, must be suspended. For reasons that are incomprehensible, Paulson and congressional Democrats refused to include such a provision. It’s a systemic reform Congress must insist upon to reduce taxpayer exposure and prevent this crisis from reoccurring. Further, an update to the Federal Deposit Insurance Corp., increasing its $100,000 limit, would relieve the concern of millions of Americans for their life savings. It’s hard to imagine why anyone would oppose such a change.

Many House conservatives do not like the structure of Paulson’s proposal to have the government purchase troubled assets. But there is nothing inherent in this plan that’s inconsistent with the two reforms outlined above.

Americans need to understand that the Senate was not scheduled to vote on this bill until Wednesday evening, as a result of the Jewish holiday of Rosh Hashanah today. We have ample time to reach an acceptable compromise if all parties act in good faith. The Democratic House majority can move to reconsider its bill if Speaker Nancy Pelosi will allow an amendment to improve it by making changes, including those I have outlined.

This problem can be solved in the very near future, and the market will come back.

Rep. John Shadegg, R-Arizona, first elected in 1994, has held a number of Republican leadership positions in the House.

Lest we forget

Lest we forget

By William D. Zeranski

While the Democrats continue in their mad dash to obscure the history of and the responsibility for the failure of Fannie Mae and Freddie Mac, the nation still tiptoes on the edge of an energy disaster.  

The avaricious desire of Democrats to quickly grab control of a huge chunk of taxpayers’ money has pushed energy concerns to the back burner.  So, it seems that the growing energy crisis is another Democrat disaster waiting in the wings as people like Nancy Pelosi and the rest of her dysfunctional cadre showboat on a Titanic of their own making. 


Oh, and winter’s coming and it gets pretty cold in some places.


We, as a nation, can’t forget the incompetence with which the Democrat Congress has handled and mishandled the energy needs of the nation.  High-gas prices continue to plague the economy and endanger the security of the country. 


Well, about a month ago, I expressed my concerns about gas prices and national security to my representative . . . , my Democrat representative.  (Do I hear laughter?)  Oh, I didn’t send an email either, but a paper, an envelope and a stamp.  I was tempted to breakout the manual typewriter, a nice metaphor, but my spelling is horrendous.  So, I word processed instead.  The letter was two pages long so I’ve decided to provide excerpts only:


The Office of Democrat Representative Dunsel* 
Big Government Street
Land of the Political Aristocracy, DC
Dear Representative Dunsel:
Just before you went on vacation, I heard a radio commercial promoting you which was paid for by the Sierra Club.  You’re for alterative fuels such as ethanol?  You’re part of the crowd which instigated a world food crisis?  Some might consider that irresponsible? 
As I write this, you are a member of a Democrat Congress with the worst approval rating in American history.  It’s worse than George Bush’s.  The only way you can possibly win this November is by supporting the people, not by promoting a losing strategy, i.e. no drilling, which will ultimately harm this country.  Your opponent only has to point out this single fact.  […]
Democrats run both houses and no rational voter will accept finger pointing in the direction of the Republicans.  The Made in America Act won’t cut it.  The Democrat Party isn’t known for business tax breaks.  Again, Bush’s approval rates are higher than yours as you are a member of the Congress.  Now, you’re on vacation again, while other Pennsylvanians are at work.
What do you know about Big Oils’ profits?  The government is still getting its tax dollars — the government being you.  Big Oil produces the fuel which makes this nation and its citizens successful.  Like many Americans, I have a retirement plan which has stock in ‘Big Oil.’  I make money for my twilight years from ‘Big Oil.’ 
Until you show me what you really know something about ‘Big Oil’ I don’t want another ignorant commercial showing up on the airwaves.  […]
You have my e-mail and my phone number, do contact me.


What expectations do we have when writing to elected officials?  Deep down, we know the response is like a stock character in a B movie like Copper Chicks Come in Zombie Town or Hell Comes to Frog Town.  We expect a letter stating a position, what the official supported or didn’t support, and how the opposition is very bad.  In short, Republican bad.  Democrat good.  Even if the Democrat is flat-out wrong. 


Many of us know and understand that the response, which may or may to be timely, can be underwhelming.  You know, those three to four pages responses which are almost too tedious to even considering reading.  Still, like the priest in the Exorcist facing down a diabolical force, I was compelled to read the response anyway.  And would you take a look at this:


Drilling for oil in the Arctic National Wildlife Refuge will not lower the price of gas.
According to the nonpartisan and independent Energy Information Administration, there is only a 50% chance of finding a sufficient amount of oil to lower the price by $0.75 per barrel in 2025 – a decrease of less than two cents per gallon.  Even if the production of oil achieved its maximum estimate of 16 billion barrels of technically recoverable oil (a probability of only five percent) the decrease in price per barrel would only be $1.44.  This would lower the price per gallon by approximately 3.5 cents.  In addition, oil found in the Arctic region would not enter the supply market until 2018, based on the EIA’s 8 – 12 year timeline.  The EIA has prepared a conservative timeline, plotting out the process of leasing the drilling exploratory wells, developing a production plan and constructing feeder pipelines. 


Looks pretty bad, don’t you think?  But if you read the actual EIA report, there’s a interesting paragraph in the summary:


Additional oil production resulting from the opening of ANWR improves the U.S. balance of trade. Cumulative expenditures on foreign crude oil and liquid fuels between 2018 and 2030 are reduced by $202 billion dollars (2006 dollars) in the mean oil resource case and reduced by $135 and $327 billion dollars in the low and high oil resource cases, respectively.


And that quote is from the May 2008 report.  Looks pretty good.  Go figure.  Oh, and the real-kicker is here, from page 9: 


The opening of ANWR to oil and gas development includes the following impacts:
    • reducing world oil prices,
    • reducing the U.S. dependence on imported foreign oil,
    • improving the U.S. balance of trade,
    • extending the life of TAPS for oil, and
    • increasing U.S. jobs.


Sometimes you have to seek and find what your representative and his staff don’t know, won’t tell, or will blatantly mislead you about.   I won’t say lie . . .


To Representative Dunsel:


[…], your letter is simply wrong.
Please, have your staff do some fact checking.  Here, go to this site, at this link: or right to the EIA as I wrote above.
Not only can ANWAR provide petroleum, the location can also provide Natural Gas.  By the way, petroleum and natural gas are both fossil fuels.  I note this because Nancy Pelosi apparently doesn’t, and I want to make sure you, as my representative, is as knowledgeable as I am. 


I sent my response off to Dunsel a week or so after I received his.  I haven’t received a response yet.  I’m not sure I will.  Presently, as an elected official, there’s a chance he won’t be around next year.  But then again, he might, and the coming energy catastrophe facing this nation is only one of a growing number of crises our Democrat Congress has decided to over look, wait on, and go on vacation during. 


The Democrat Congress already dictates where oil is drilled for.  When the energy crisis hits its peak, will the Democrats then dictate that oil production needs to be nationalized as well?  I won’t lay any bets, but I will say, “Let’s remember who got us into this mess.”


*”Dunsel … is a term used by midshipmen at Starfleet Academy. It refers to a part which serves no useful purpose.” (Mr Spock, in Star Trek, Episode 53: “The Ultimate Computer”)

Thanks To 3 Democrat Senators Our “Evil Big Oil Co.s” Won’t Be Pumping Iraqi Oil, But China Will Be

Was Schumer’s Attack On Indymac Coordinated with ‘activist’ group?

Was Schumer’s Attack On Indymac Coordinated

with ‘activist’ group?

Clarice Feldman

CNBC is suggesting that Senator Schumer’s unprecedented role in breaking Indymac, a Pasadena bank, was part of a coordinated scheme with The Center for Responsible Lending , as usual, a name from a  far left “public interest” operation which, as is often the case,  disguises its objectives and operations.  It is for anything but responsible klending practices, in my opinion. (See this.)
“The Center for Responsible Lending issued an attack on Indymac within a few days of Schumerʼs letter. CRL is part of a small army of left of center ʽresearchʼ groups, community organizers, and public interest law firms who make their living accusing home lenders of racial redlining and predatory lending. On June 20th the Center accused Indymac of unfair practices regarding minority borrowers.
“A suspicious person might think that a network of lefty attack groups proficient in bank bashing and frequently funded by trial lawyers and short-sellers, coordinated their activities with a law firm on the hunt and a Senator who works closely with the network. “
Just imagine how much damage Schumer and his party will do should they control all three branches of the federal government.

Feds Blame Schumer for Run on Indymac

Feds Blame Schumer for Run on Indymac

Rick Moran

This may be a first in the history of the United States Senate. Federal regulators have cited New York Senator Charles Schumer as the proximate cause for the run on mortgage giant Indymac’s deposits. That run caused the feds to take over the ailing institution to guarantee its remaining deposits.

It seems that while engaging in his favorite pastime of trying to get his mug on TV and his name in the headlines, Schumer released a letter he wrote to the Office of Thrift Supervision and the FDIC 


The OTS has determined that the current institution, IndyMac Bank, is unlikely to be able to meet continued depositors’ demands in the normal course of business and is therefore in an unsafe and unsound condition. The immediate cause of the closing was a deposit run that began and continued after the public release of a June 26 letter to the OTS and the FDIC from Senator Charles Schumer of New York. The letter expressed concerns about IndyMac’s viability. In the following 11 business days, depositors withdrew more than $1.3 billion from their accounts.

“This institution failed today due to a liquidity crisis,” OTS Director John Reich said. “Although this institution was already in distress, I am troubled by any interference in the regulatory process.”

There was absolutely no reason for Schumer to release the letter except to garner headlines. The publicity hound is going to cost the American taxpayer billions.

Maybe we should take it out of his salary…