Way of Life - Obama TV Ad
Veteran - Obama TV Ad
Hunter -- Obama TV ad
Pennsylvania Values - Joe Biden TV Ad
Saturday, September 27, 2008
Thursday, September 25, 2008
Fairfax, VA-Sen. Barack Obama's presidential campaign has sent threatening letters to news agencies in Pennsylvania and Ohio to stop airing ads exposing his anti-gun record sponsored by the National Rifle Association Political Victory Fund (NRA-PVF).
The kicker? NRA-PVF's Ohio’s ads have not yet begun running.
“Barack Obama and his campaign are terrified of the truth,” declared Chris W. Cox, Chairman of NRA-PVF. “Sen. Obama's statements and support for restricting access to firearms, raising taxes on guns and ammunition and voting against the use of firearms for self-defense in the home are a matter of public record. NRA-PVF will make sure that everyone knows of Obama's abysmal record on guns and hunting.”
The Obama campaign sent cease and desist letters to news outlets in Pennsylvania and Ohio, denouncing the ads and demanding their removal from the airwaves. All stations where NRA-PVF has purchased or plans to purchase ads have been provided with documented evidence of Sen. Obama's anti-gun record.
--nra - pvf--
Established in 1871, the National Rifle Association is America’s oldest civil rights and sportsmen's group. Four million members strong, NRA continues to uphold the Second Amendment and advocates enforcement of existing laws against violent offenders to reduce crime. The Association remains the nation's leader in firearm education and training for law-abiding gun owners, law enforcement and the armed services.
Posted by Joyce Kavitsky at 9/27/2008 07:22:00 PM
Words-Lewis Allan, Music-Earl Robinson
What is America to me
A name, a map, or a flag I see
A certain word, democracy
What is America to me
The house I live in
A plot of earth, the street
The grocer and the butcher
Or the people that I meet
The children in the playground
The faces that I see
All races and religions
That's America to me
The place I work in
The worker by my side
The little town the city
Where my people lived and died
The howdy and the handshake
The air a feeling free
And the right to speak your mind out
That's America to me
The things I see about me
The big things and the small
That little corner newsstand
Or the house a mile tall
The wedding and the churchyard
The laughter and the tears
The dream that's been a growing
For more than two hundred years
The town I live in
The street, the house, the room
The pavement of the city
Or a garden all in bloom
The church the school the clubhouse
The millions lights I see
Especially the people
That's America to me
To hear the song press here
Legendary actor Paul Newman dies at age 83
24 minutes ago
Paul Newman, the Academy-Award winning superstar who personified cool as the anti-hero of such films as "Hud," "Cool Hand Luke" and "The Color of Money" — and as an activist, race car driver and popcorn impresario — has died. He was 83.
Newman died Friday after a long battle with cancer at his farmhouse near Westport, publicist Jeff Sanderson said. He was surrounded by his family and close friends.
In May, Newman had dropped plans to direct a fall production of "Of Mice and Men," citing unspecified health issues.
He got his start in theater and on television during the 1950s, and went on to become one of the world's most enduring and popular film stars, a legend held in awe by his peers. He was nominated for Oscars 10 times, winning one regular award and two honorary ones, and had major roles in more than 50 motion pictures, including "Exodus," "Butch Cassidy and the Sundance Kid," "The Verdict," "The Sting" and "Absence of Malice."
Newman worked with some of the greatest directors of the past half century, from Alfred Hitchcock and John Huston to Robert Altman, Martin Scorsese and the Coen brothers. His co-stars included Elizabeth Taylor, Lauren Bacall, Tom Cruise, Tom Hanks and, most famously, Robert Redford, his sidekick in "Butch Cassidy" and "The Sting."
He sometimes teamed with his wife and fellow Oscar winner, Joanne Woodward, with whom he had one of Hollywood's rare long-term marriages. "I have steak at home, why go out for hamburger?" Newman told Playboy magazine when asked if he was tempted to stray. They wed in 1958, around the same time they both appeared in "The Long Hot Summer," and Newman directed her in several films, including "Rachel, Rachel" and "The Glass Menagerie."
With his strong, classically handsome face and piercing blue eyes, Newman was a heartthrob just as likely to play against his looks, becoming a favorite with critics for his convincing portrayals of rebels, tough guys and losers. "I was always a character actor," he once said. "I just looked like Little Red Riding Hood."
Newman had a soft spot for underdogs in real life, giving tens of millions to charities through his food company and setting up camps for severely ill children. Passionately opposed to the Vietnam War, and in favor of civil rights, he was so famously liberal that he ended up on President Nixon's "enemies list," one of the actor's proudest achievements, he liked to say.
A screen legend by his mid-40s, he waited a long time for his first competitive Oscar, winning in 1987 for "The Color of Money," a reprise of the role of pool shark "Fast" Eddie Felson, whom Newman portrayed in the 1961 film "The Hustler."
Newman delivered a magnetic performance in "The Hustler," playing a smooth-talking, whiskey-chugging pool shark who takes on Minnesota Fats — played by Jackie Gleason — and becomes entangled with a gambler played by George C. Scott. In the sequel — directed by Scorsese — "Fast Eddie" is no longer the high-stakes hustler he once was, but rather an aging liquor salesman who takes a young pool player (Cruise) under his wing before making a comeback.
He won an honorary Oscar in 1986 "in recognition of his many and memorable compelling screen performances and for his personal integrity and dedication to his craft." In 1994, he won a third Oscar, the Jean Hersholt Humanitarian Award, for his charitable work.
His most recent academy nod was a supporting actor nomination for the 2002 film "Road to Perdition." One of Newman's nominations was as a producer; the other nine were in acting categories. (Jack Nicholson holds the record among actors for Oscar nominations, with 12; actress Meryl Streep has had 14.)
As he passed his 80th birthday, he remained in demand, winning an Emmy and a Golden Globe for the 2005 HBO drama "Empire Falls" and providing the voice of a crusty 1951 car in the 2006 Disney-Pixar hit, "Cars."
But in May 2007, he told ABC's "Good Morning America" he had given up acting, though he intended to remain active in charity projects. "I'm not able to work anymore as an actor at the level I would want to," he said. "You start to lose your memory, your confidence, your invention. So that's pretty much a closed book for me."
He received his first Oscar nomination for playing a bitter, alcoholic former star athlete in the 1958 film "Cat on a Hot Tin Roof." Elizabeth Taylor played his unhappy wife and Burl Ives his wealthy, domineering father in Tennessee Williams' harrowing drama, which was given an upbeat ending for the screen.
In "Cool Hand Luke," he was nominated for his gritty role as a rebellious inmate in a brutal Southern prison. The movie was one of the biggest hits of 1967 and included a tagline, delivered one time by Newman and one time by prison warden Strother Martin, that helped define the generation gap, "What we've got here is (a) failure to communicate."
Newman's hair was graying, but he was as gourgeous as ever and on the verge of his greatest popular success. In 1969, Newman teamed with Redford for "Butch Cassidy and the Sundance Kid," a comic Western about two outlaws running out of time. Newman paired with Redford again in 1973 in "The Sting," a comedy about two Depression-era con men. Both were multiple Oscar winners and huge hits, irreverent, unforgettable pairings of two of the best-looking actors of their time.
Newman also turned to producing and directing. In 1968, he directed "Rachel, Rachel," a film about a lonely spinster's rebirth. The movie received four Oscar nominations, including Newman, for producer of a best motion picture, and Woodward, for best actress. The film earned Newman the best director award from the New York Film Critics.
In the 1970s, Newman, admittedly bored with acting, became fascinated with auto racing, a sport he studied when he starred in the 1972 film, "Winning." After turning professional in 1977, Newman and his driving team made strong showings in several major races, including fifth place in Daytona in 1977 and second place in the Le Mans in 1979.
"Racing is the best way I know to get away from all the rubbish of Hollywood," he told People magazine in 1979.
Despite his love of race cars, Newman continued to make movies and continued to pile up Oscar nominations, his looks remarkably intact, his acting becoming more subtle, nothing like the mannered method performances of his early years, when he was sometimes dismissed as a Brando imitator. "It takes a long time for an actor to develop the assurance that the trim, silver-haired Paul Newman has acquired," Pauline Kael wrote of him in the early 1980s.
In 1982, he got his Oscar fifth nomination for his portrayal of an honest businessman persecuted by an irresponsible reporter in "Absence of Malice." The following year, he got his sixth for playing a down-and-out alcoholic attorney in "The Verdict."
In 1995, he was nominated for his slyest, most understated work yet, the town curmudgeon and deadbeat in "Nobody's Fool." New York Times critic Caryn James found his acting "without cheap sentiment and self-pity," and observed, "It says everything about Mr. Newman's performance, the single best of this year and among the finest he has ever given, that you never stop to wonder how a guy as good-looking as Paul Newman ended up this way."
Newman, who shunned Hollywood life, was reluctant to give interviews and usually refused to sign autographs because he found the majesty of the act offensive, according to one friend.
He also claimed that he never read reviews of his movies.
"If they're good you get a fat head and if they're bad you're depressed for three weeks," he said.
Off the screen, Newman had a taste for beer and was known for his practical jokes. He once had a Porsche installed in Redford's hallway — crushed and covered with ribbons.
"I think that my sense of humor is the only thing that keeps me sane," he told Newsweek magazine in a 1994 interview.
In 1982, Newman and his Westport neighbor, writer A.E. Hotchner, started a company to market Newman's original oil-and-vinegar dressing. Newman's Own, which began as a joke, grew into a multimillion-dollar business selling popcorn, salad dressing, spaghetti sauce and other foods. All of the company's profits are donated to charities. By 2007, the company had donated more than $175 million, according to its Web site.
"We will miss our friend Paul Newman, but are lucky ourselves to have known such a remarkable person," Robert Forrester, vice chairman of Newman's Own Foundation, said in a statement.
Hotchner said Newman should have "everybody's admiration."
"For me it's the loss of an adventurous freindship over the past 50 years and it's the loss of a great American citizen," Hotchner told The Associated Press.
In 1988, Newman founded a camp in northeastern Connecticut for children with cancer and other life-threatening diseases. He went on to establish similar camps in several other states and in Europe.
He and Woodward bought an 18th century farmhouse in Westport, where they raised their three daughters, Elinor "Nell," Melissa and Clea.
Newman had two daughters, Susan and Stephanie, and a son, Scott, from a previous marriage to Jacqueline Witte.
Scott died in 1978 of an accidental overdose of alcohol and Valium. After his only son's death, Newman established the Scott Newman Foundation to finance the production of anti-drug films for children.
Newman was born in Cleveland, Ohio, the second of two boys of Arthur S. Newman, a partner in a sporting goods store, and Theresa Fetzer Newman.
He was raised in the affluent suburb of Shaker Heights, where he was encouraged him to pursue his interest in the arts by his mother and his uncle Joseph Newman, a well-known Ohio poet and journalist.
Following World War II service in the Navy, he enrolled at Kenyon College in Gambier, Ohio, where he got a degree in English and was active in student productions.
He later studied at Yale University's School of Drama, then headed to New York to work in theater and television, his classmates at the famed Actor's Studio including Brando, James Dean and Karl Malden. His breakthrough was enabled by tragedy: Dean, scheduled to star as the disfigured boxer in a television adaptation of Ernest Hemingway's "The Battler," died in a car crash in 1955. His role was taken by Newman, then a little-known performer.
Newman started in movies the year before, in "The Silver Chalice," a costume film he so despised that he took out an ad in Variety to apologize. By 1958, he had won the best actor award at the Cannes Film Festival for the shiftless Ben Quick in "The Long Hot Summer."
In December 1994, about a month before his 70th birthday, he told Newsweek magazine he had changed little with age.
"I'm not mellower, I'm not less angry, I'm not less self-critical, I'm not less tenacious," he said. "Maybe the best part is that your liver can't handle those beers at noon anymore," he said.
Newman is survived by his wife, five children, two grandsons and his older brother Arthur.
On the Net:
Copyright © 2008 The Associated Press. All rights reserved.
Friday, September 26, 2008
by Elisabeth Meinecke
The Republican Study Committee has released an alternative to the Treasury Department's bailout proposal and will discuss the proposal at a press conference today. Conservatives have expressed concern that the Treasury's proposal will alter the country's free-market system, awards massive authority to the Treasury, and fails to penalize debtholders and shareholders. Here is the committee's free-market alternative as released this morning:
REFORMING A TAX CODE THAT DISCOURAGES CAPITAL FORMATION
Two-Year Suspension of the Capital Gains: Immediately suspend the capital gains rate of 15% for individuals and 35% for corporations. By encouraging corporations to sell unwanted assets, this provision would unleash funds and materials with which to create jobs and grow the economy. After the two-year suspension, capital gains rates would return to present levels but assets would be indexed permanently for any inflationary gains.
REFORMING A FAILURE IN GOVERNMENT INSTITUTIONS
Schedule the GSEs for Privatization: Transition Fannie and Freddie over a reasonable time period to truly private companies without special government privileges and open them up to real market competition. This reform would 1) establish commonsense limits for their capital requirements and portfolio holdings relative their size, 2) focus their mission on affordable housing only, not profit making, 3) require them to pay an appropriate risk-based amount for the government guarantee they enjoy, 4) subject them to state and local taxes and accurate SEC filings like every other private for-profit corporation, and 5) ultimately provide for the phase out their GSE charters once their conservatorship has ended. In a matter of mere weeks, Fannie and Freddie have gone from too big to fail to too dangerous to repeat. This hybrid illusion must not be allowed to continue.
Stabilize the Dollar: Repeal the Humphrey-Hawkins Full Employment Act which diverts the Federal Reserve’s attention from long-term price stability to short-term economic growth. In an effort to fuel the economy, this additional mandate has encouraged the Fed to keep rates artificially low, fueling economic boom and busts, and now a strong up-tick in inflation and the decline of the dollar (as investors free dollars for hard assets). This reform would require the Fed to establish a numerical definition for price stability and maintain a policy that promotes it over the long-term.
REFORMING A FAILURE IN GOVERNMENT REGULATION
Suspend “Mark to Market” Accounting: Suspend the mark-to-market regulatory rules for long-term assets. These rules require financial firms to mark assets at current market levels, even where the no market exists and any immediate transactions would result in fire-sale prices. Instead of allowing firms to mark these assets to their true economic value, these rules contribute to a downward spiral as firms have to evaluate their assets not on the basis of their long-term investment but rather on a short-term mania.
Miss Meinecke was a member of Hillsdale College's Dow Journalism Program, sports editor and beat reporter for the campus newspaper, and also contributed to Life Times, the newsletter for Southern Indiana Right to Life. She interned at Comcast SportsNet in Washington, D.C. through the National Journalism Center before joining Human Events in August 2008.
Posted by Joyce Kavitsky at 9/26/2008 11:01:00 PM
September 26, 2008
Well, it was nice of Barack Obama to take a break from his debate prep to fly to Washington to help address what he calls the biggest economic crisis facing the nation since the Depression. Of course, it did take a presidential invitation to jolt him into action. In contrast, John McCain, on his own initiative, suspended his campaign to offer aid in achieving bipartisan consensus on economic rescue legislation.
What we are talking about here is leadership in a time of crisis. Maybe there was a political calculation in the McCain campaign as the Republican presidential nominee, whose poll numbers have sagged, made his decision. But wasn't his surprise announcement completely in character for the maverick senator? Be it campaign finance regulation, immigration reform or climate change, he has never hesitated to take a leadership position on an issue he sees as critical to the country.
With George W. Bush being a lame duck president whose influence is declining among Republican lawmakers, McCain is the head of the GOP. By the same token, Obama has replaced former President Bill Clinton as the leader of the Democrats. In what everyone believes is a critical governing moment for the country, both men -- who are, after all, members of the Senate -- should be at the center of decision-making. It's a simple matter of all officers on deck in the heat of battle.
As it turns out, McCain was encouraged by forces outside his campaign. The Wall Street Journal reported that in a Wednesday meeting with some of the "financial titans" of Wall Street, he was told of the pressing need to pass the rescue package soon. "We urged John to get all over it, that this is a national security issue," one executive told the Journal.
Also, it was apparent that GOP lawmakers were looking to him for guidance, especially since many of their constituents harbor doubts about the rescue bill. No less a figure than Senate Majority Leader Harry Reid said McCain's support was necessary to pass the bill. But once McCain's announcement came, Reid switched signals and claimed he wasn't needed in Washington. Talk about cynical politics. Reid recognized McCain was exercising leadership that the Democratic nominee wasn't, and he tried to demean it.
Obama was no less dismissive. Calling for the campaign to continue, he said, "It's going to be part of the president's job to deal with more than one thing at once." That's certainly glib. But it ignores the obvious fact that we are in a time of extraordinary challenge that requires concentrated focus by our nation's leaders to meet it.
Obama finally relented and left his preparations for the debate (scheduled for tonight but in doubt because McCain has suspended his campaign) after Bush invited him to join McCain and congressional leaders for a meeting Thursday. The idea of a presidential session to work toward a bipartisan solution was suggested to the White House by McCain. That's a pretty clear picture of the veteran senator trying to play a helpful role.
As for Obama's insistence that the nation couldn't afford a break from politics, let's remember the presidential contest already has stretched over two years. A timeout for a couple of days for the two leaders to help navigate the nation through troubled waters might be welcomed by voters. That's especially true for Americans watching the value of their homes and retirement accounts, their most important investments, being threatened by the mortgage meltdown.
There was some heated rhetoric about presidential politics being injected into the economic rescue deliberations. As if politics is ever far from anything in Washington. Political risks exist for both sides. McCain could end up with little to show for his intervention and Obama could be branded as reluctant to act in a time of national crisis. Whatever the political fallout, the voters will learn something about both candidates as they ponder the decision they must make Nov. 4.
Posted by Joyce Kavitsky at 9/26/2008 04:42:00 PM
Thursday, September 25, 2008
Published: Sep 25, 2008 09:24 AM
Hundreds of cars lined streets this morning as motorists in the Charlotte metro region tried to cope with an ever-worsening gasoline shortage situation.
Some motorists waited up to five hours, and fights were reported as people accused other customers of cutting in line.
Some gas stations that opened this morning with what they thought were ample supplies ran out within a few hours.
Police were called out several times to break up fights among angry customers.
North Carolina Gov. Mike Easley announced late Wednesday night that he had ordered tanker trucks from Tennessee, Wilmington and South Carolina to deliver gas to the western Carolinas. Easley said relief is coming to the area in the next day.
But it is too late to make a difference this morning.
Motorists who had hoped to awaken and find a re-supply of many gas stations were disappointed. The situation looks much the same as it did Wednesday.
At 6 a.m., about 50 cars were in line at the Gate station near the Wal-Mart store off Sardis Road North in southeast Charlotte. By 8:30 a.m., that line had expanded to an estimated 225 vehicles. The lines were even longer, spilling out onto Sardis Road North.
Charlotte-Mecklenburg police brought in a mobile watch tower, installing it in the Wal-Mart parking lot to keep an eye on customers and prevent an outbreak of violence among customers desperate to fill their nearly-empty tanks -- or, in some cases, to top off gas tanks that already were half-full.
The Texaco station on outbound East Independence Boulevard at Sharon Amity Road received a gas supply overnight, and customers lined up along both streets before 6 a.m. today. But about 8:30 a.m., clerks came out of the store and put bags over the pumps. The supply had run out.
It was the same story on Pineville-Matthews Road in south Charlotte, at an Exxon station. Clerks thought they had enough gas from an overnight shipment to last the day. Instead, the gas was gone by 8 a.m.
North Charlotte wasn't immune from the problems. Police report congested traffic on Mallard Creek Road at West W.T. Harris Boulevard -- due to customers waiting in line for gas.
And police in Matthews report the line along Monroe Road stretches for about a quarter-mile approaching Matthews Township Parkway, as motorists wait to get gas at one of few stations with fuel.
Police are directing traffic at a number of locations, where long lines of customers waiting for gas are blocking travel lanes on major highways -- including East Independence Boulevard and Pineville-Matthews Road. Matthews police were monitoring the flow of customer traffic at the Shell and Exxon stations on East Independence Boulevard at Matthews-Mint Hill Road, near Butler High School.
At 8:45 a.m., both of those stations had gas -- at least for a while.
Similar problems are being reported in the Fort Mill-Rock Hill area, in Gastonia, and in Union County. Motorists report all the stations in the Weddington-Wesley Chapel area of southwest Union County were without fuel late Wednesday night.
Abandoned vehicles could be seen this morning along the sides of roads across the area -- apparently the result of drivers running out of fuel.
One abandoned vehicle was reported before 6 a.m. on the right southbound lane of Wendover Road, between Independence Boulevard and Monroe Road. It was cleared a short time later. Other abandoned vehicles were reported before 9 a.m. on Sharon Road at Sharonview Road; Idlewild Road at East W.T. Harris Boulevard; and Eastway Drive at North Tryon Street.
Abandoned vehicles also were reported in parts of Cabarrus, Gaston, and Union counties, and in York County of South Carolina.
Posted by Joyce Kavitsky at 9/25/2008 11:24:00 AM
Wednesday, September 24, 2008
The Mother of All Bailouts has many fathers. As panicked politicians prepare to fork over $1 trillion in taxpayer funding to rescue the financial industry, they've fingered regulation, deregulation, Fannie Mae and Freddie Mac, the Community Reinvestment Act, Jimmy Carter, Bill Clinton, both Bushes, greedy banks, greedy borrowers, greedy short-sellers and minority home ownership mau-mauers (can't call 'em greedy, that would be racist) for blame.
But there's one giant paternal elephant in the room that has slipped notice: how illegal immigration, crime-enabling banks and open-borders Bush policies fueled the mortgage crisis.
It's no coincidence that most of the areas hardest hit by the foreclosure wave -- Loudoun County, Va., California's Inland Empire, Stockton and San Joaquin Valley, and Las Vegas and Phoenix, for starters -- also happen to be some of the nation's largest illegal alien sanctuaries. Half of the mortgages to Hispanics are subprime (the accursed species of loan to borrowers with the shadiest credit histories). A quarter of all those subprime loans are in default and foreclosure.
Regional reports across the country have decried the subprime meltdown's impact on illegal immigrant "victims." A July report showed that in seven of the 10 metro areas with the highest foreclosure rates, Hispanics represented at least one-third of the population; in two of those areas -- Merced and Salinas-Monterey, Calif. -- Hispanics comprised half the population. The amnesty-promoting National Council of La Raza and its Development Fund have received millions in federal funds to "counsel" their constituents on obtaining mortgages with little to no money down; the group almost succeeded in attaching a $10-million earmark for itself in one of the housing bills past this spring.
For the last five years, I've reported on the rapidly expanding illegal alien home loan racket. The top banks clamoring for their handouts as their profits plummet, led by Wachovia and Bank of America, launched aggressive campaigns to woo illegal alien homebuyers. The quasi-governmental Wisconsin Housing and Economic Development Authority jumped in to guarantee home loans to illegal immigrants. The Washington Post noted, almost as an afterthought in a 2005 report: "Hispanics, the nation's fastest-growing major ethnic or racial group, have been courted aggressively by real estate agents, mortgage brokers and programs for first-time buyers that offer help with closing costs. Ads proclaim: "Sin verificacion de ingresos! Sin verificacion de documento!" -- which loosely translates as, 'Income tax forms are not required, nor are immigration papers.'"
In addition, fraudsters have engaged in massive house-flipping rings using illegal aliens as straw buyers. Among many examples cited by the FBI: a conspiracy in Las Vegas involving a former Nevada First Residential Mortgage Company branch manager who directed loan officers and processors in the origination of 233 fraudulent Federal Housing Authority loans valued at over $25 million. The defrauders manufactured and submitted false employment and income documentation for borrowers; most were illegal immigrants from Mexico. To date, the FBI reported, "Fifty-eight loans with a total value of $6.2 million have gone into default, with a loss to the Housing and Urban Development Department of over $1.9 million."
It's the tip of the iceberg. Thanks to lax Bush administration-approved policies allowing illegal aliens to use "matricula consular cards" and taxpayer identification numbers to open bank accounts, more forms of mortgage fraud have burgeoned. Moneylenders still have no access to a verification system to check Social Security numbers before approving loans.
In an interview about rampant illegal alien home loan fraud, a spokeswoman for the U.S. General Accounting Office told me five years ago: "[C]onsidering the size of Los Angeles, New York, Chicago, Houston and other large cities throughout the United States known to be inundated with illegal aliens, I don't think the federal government is willing to expose this problem for financial reasons as well as for fear of political repercussions."
The chickens are coming home to roost. And law-abiding, responsible taxpayers are going to pay for it.
Michelle Malkin makes news and waves with a unique combination of investigative journalism and incisive commentary. She is the author of Unhinged: Exposing Liberals Gone Wild.
Posted by Joyce Kavitsky at 9/25/2008 11:15:00 AM
for government to contract by getting out of the housing business altogether by completely closing the Department of Housing and Urban Development along with every nook and cranny it oversees and runs. As you can see from this August 1996 Public Housing Homeownership Initiative Strategy people were allowed to get grants, mortgages, and loans for houses while on welfare or public assistance. Bad investments were made by companies forced, by law, to make them against their better judgement. The less our overburdensome government gets involved the better things work.
Public Housing Homeownership Initiative - Get more Legal Forms
How A Clinton-Era Rule Rewrite Made Subprime Crisis Inevitable
By TERRY JONES
INVESTOR'S BUSINESS DAILY | Posted Wednesday, September 24, 2008 4:30 PM PT
One of the most frequently asked questions about the subprime market meltdown and housing crisis is: How did the government get so deeply involved in the housing market?
IBD Exclusive Series: What Caused The Loan Crisis?
The answer is: President Clinton wanted it that way.
Fannie Mae and Freddie Mac, even into the early 1990s, weren't the juggernauts they'd later be.
While President Carter in 1977 signed the Community Reinvestment Act, which pushed Fannie and Freddie to aggressively lend to minority communities, it was Clinton who supercharged the process. After entering office in 1993, he extensively rewrote Fannie's and Freddie's rules.
In so doing, he turned the two quasi-private, mortgage-funding firms into a semi-nationalized monopoly that dispensed cash to markets, made loans to large Democratic voting blocs and handed favors, jobs and money to political allies. This potent mix led inevitably to corruption and the Fannie-Freddie collapse.
Despite warnings of trouble at Fannie and Freddie, in 1994 Clinton unveiled his National Homeownership Strategy, which broadened the CRA in ways Congress never intended.
Addressing the National Association of Realtors that year, Clinton bluntly told the group that "more Americans should own their own homes." He meant it.
Clinton saw homeownership as a way to open the door for blacks and other minorities to enter the middle class.
Though well-intended, the problem was that Congress was about to change hands, from the Democrats to the Republicans. Rather than submit legislation that the GOP-led Congress was almost sure to reject, Clinton ordered Robert Rubin's Treasury Department to rewrite the rules in 1995.
The rewrite, as City Journal noted back in 2000, "made getting a satisfactory CRA rating harder." Banks were given strict new numerical quotas and measures for the level of "diversity" in their loan portfolios. Getting a good CRA rating was key for a bank that wanted to expand or merge with another.
Loans started being made on the basis of race, and often little else.
"Bank examiners would use federal home-loan data, broken down by neighborhood, income group and race, to rate banks on performance," wrote Howard Husock, a scholar at the Manhattan Institute.
But those rules weren't enough.
Clinton got the Department of Housing and Urban Development to double-team the issue. That would later prove disastrous.
Clinton's HUD secretary, Andrew Cuomo, "made a series of decisions between 1997 and 2001 that gave birth to the country's current crisis," the liberal Village Voice noted. Among those decisions were changes that let Fannie and Freddie get into subprime loan markets in a big way.
Other rule changes gave Fannie and Freddie extraordinary leverage, allowing them to hold just 2.5% of capital to back their investments, vs. 10% for banks.
Since they could borrow at lower rates than banks due to implicit government guarantees for their debt, the government-sponsored enterprises boomed.
With incentives in place, banks poured billions of dollars of loans into poor communities, often "no doc" and "no income" loans that required no money down and no verification of income.
By 2007, Fannie and Freddie owned or guaranteed nearly half of the $12 trillion U.S. mortgage market — a staggering exposure.
Worse still was the cronyism.
Fannie and Freddie became home to out-of-work politicians, mostly Clinton Democrats. An informal survey of their top officials shows a roughly 2-to-1 dominance of Democrats over Republicans.
Then there were the campaign donations. From 1989 to 2008, some 384 politicians got their tip jars filled by Fannie and Freddie.
Over that time, the two GSEs spent $200 million on lobbying and political activities. Their charitable foundations dropped millions more on think tanks and radical community groups.
Did it work? Well, if measured by the goal of putting more poor people into homes, the answer would have to be yes.
From 1995 to 2005, a Harvard study shows, minorities made up 49% of the 12.5 million new homeowners.
The problem is that many of those loans have now gone bad, and minority homeownership rates are shrinking fast.
Fannie and Freddie, with their massive loan portfolios stuffed with securitized mortgage-backed paper created from subprime loans, are a failed legacy of the Clinton era.
Posted by Joyce Kavitsky at 9/25/2008 09:00:00 AM
Wednesday, September 24, 2008
9:01 P.M. EDT
THE PRESIDENT: Good evening. This is an extraordinary period for America's economy. Over the past few weeks, many Americans have felt anxiety about their finances and their future. I understand their worry and their frustration. We've seen triple-digit swings in the stock market. Major financial institutions have teetered on the edge of collapse, and some have failed. As uncertainty has grown, many banks have restricted lending. Credit markets have frozen. And families and businesses have found it harder to borrow money.
We're in the midst of a serious financial crisis, and the federal government is responding with decisive action. We've boosted confidence in money market mutual funds, and acted to prevent major investors from intentionally driving down stocks for their own personal gain.
Most importantly, my administration is working with Congress to address the root cause behind much of the instability in our markets. Financial assets related to home mortgages have lost value during the housing decline. And the banks holding these assets have restricted credit. As a result, our entire economy is in danger. So I've proposed that the federal government reduce the risk posed by these troubled assets, and supply urgently-needed money so banks and other financial institutions can avoid collapse and resume lending.
This rescue effort is not aimed at preserving any individual company or industry -- it is aimed at preserving America's overall economy. It will help American consumers and businesses get credit to meet their daily needs and create jobs. And it will help send a signal to markets around the world that America's financial system is back on track.
I know many Americans have questions tonight: How did we reach this point in our economy? How will the solution I've proposed work? And what does this mean for your financial future? These are good questions, and they deserve clear answers.
First, how did our economy reach this point?
Well, most economists agree that the problems we are witnessing today developed over a long period of time. For more than a decade, a massive amount of money flowed into the United States from investors abroad, because our country is an attractive and secure place to do business. This large influx of money to U.S. banks and financial institutions -- along with low interest rates -- made it easier for Americans to get credit. These developments allowed more families to borrow money for cars and homes and college tuition -- some for the first time. They allowed more entrepreneurs to get loans to start new businesses and create jobs.
Unfortunately, there were also some serious negative consequences, particularly in the housing market. Easy credit -- combined with the faulty assumption that home values would continue to rise -- led to excesses and bad decisions. Many mortgage lenders approved loans for borrowers without carefully examining their ability to pay. Many borrowers took out loans larger than they could afford, assuming that they could sell or refinance their homes at a higher price later on.
Optimism about housing values also led to a boom in home construction. Eventually the number of new houses exceeded the number of people willing to buy them. And with supply exceeding demand, housing prices fell. And this created a problem: Borrowers with adjustable rate mortgages who had been planning to sell or refinance their homes at a higher price were stuck with homes worth less than expected -- along with mortgage payments they could not afford. As a result, many mortgage holders began to default.
These widespread defaults had effects far beyond the housing market. See, in today's mortgage industry, home loans are often packaged together, and converted into financial products called "mortgage-backed securities." These securities were sold to investors around the world. Many investors assumed these securities were trustworthy, and asked few questions about their actual value. Two of the leading purchasers of mortgage-backed securities were Fannie Mae and Freddie Mac. Because these companies were chartered by Congress, many believed they were guaranteed by the federal government. This allowed them to borrow enormous sums of money, fuel the market for questionable investments, and put our financial system at risk.
The decline in the housing market set off a domino effect across our economy. When home values declined, borrowers defaulted on their mortgages, and investors holding mortgage-backed securities began to incur serious losses. Before long, these securities became so unreliable that they were not being bought or sold. Investment banks such as Bear Stearns and Lehman Brothers found themselves saddled with large amounts of assets they could not sell. They ran out of the money needed to meet their immediate obligations. And they faced imminent collapse. Other banks found themselves in severe financial trouble. These banks began holding on to their money, and lending dried up, and the gears of the American financial system began grinding to a halt.
With the situation becoming more precarious by the day, I faced a choice: To step in with dramatic government action, or to stand back and allow the irresponsible actions of some to undermine the financial security of all.
I'm a strong believer in free enterprise. So my natural instinct is to oppose government intervention. I believe companies that make bad decisions should be allowed to go out of business. Under normal circumstances, I would have followed this course. But these are not normal circumstances. The market is not functioning properly. There's been a widespread loss of confidence. And major sectors of America's financial system are at risk of shutting down.
The government's top economic experts warn that without immediate action by Congress, America could slip into a financial panic, and a distressing scenario would unfold:
More banks could fail, including some in your community. The stock market would drop even more, which would reduce the value of your retirement account. The value of your home could plummet. Foreclosures would rise dramatically. And if you own a business or a farm, you would find it harder and more expensive to get credit. More businesses would close their doors, and millions of Americans could lose their jobs. Even if you have good credit history, it would be more difficult for you to get the loans you need to buy a car or send your children to college. And ultimately, our country could experience a long and painful recession.
Fellow citizens: We must not let this happen. I appreciate the work of leaders from both parties in both houses of Congress to address this problem -- and to make improvements to the proposal my administration sent to them. There is a spirit of cooperation between Democrats and Republicans, and between Congress and this administration. In that spirit, I've invited Senators McCain and Obama to join congressional leaders of both parties at the White House tomorrow to help speed our discussions toward a bipartisan bill.
I know that an economic rescue package will present a tough vote for many members of Congress. It is difficult to pass a bill that commits so much of the taxpayers' hard-earned money. I also understand the frustration of responsible Americans who pay their mortgages on time, file their tax returns every April 15th, and are reluctant to pay the cost of excesses on Wall Street. But given the situation we are facing, not passing a bill now would cost these Americans much more later.
Many Americans are asking: How would a rescue plan work?
After much discussion, there is now widespread agreement on the principles such a plan would include. It would remove the risk posed by the troubled assets -- including mortgage-backed securities -- now clogging the financial system. This would free banks to resume the flow of credit to American families and businesses. Any rescue plan should also be designed to ensure that taxpayers are protected. It should welcome the participation of financial institutions large and small. It should make certain that failed executives do not receive a windfall from your tax dollars. It should establish a bipartisan board to oversee the plan's implementation. And it should be enacted as soon as possible.
In close consultation with Treasury Secretary Hank Paulson, Federal Reserve Chairman Ben Bernanke, and SEC Chairman Chris Cox, I announced a plan on Friday. First, the plan is big enough to solve a serious problem. Under our proposal, the federal government would put up to $700 billion taxpayer dollars on the line to purchase troubled assets that are clogging the financial system. In the short term, this will free up banks to resume the flow of credit to American families and businesses. And this will help our economy grow.
Second, as markets have lost confidence in mortgage-backed securities, their prices have dropped sharply. Yet the value of many of these assets will likely be higher than their current price, because the vast majority of Americans will ultimately pay off their mortgages. The government is the one institution with the patience and resources to buy these assets at their current low prices and hold them until markets return to normal. And when that happens, money will flow back to the Treasury as these assets are sold. And we expect that much, if not all, of the tax dollars we invest will be paid back.
A final question is: What does this mean for your economic future?
The primary steps -- purpose of the steps I have outlined tonight is to safeguard the financial security of American workers and families and small businesses. The federal government also continues to enforce laws and regulations protecting your money. The Treasury Department recently offered government insurance for money market mutual funds. And through the FDIC, every savings account, checking account, and certificate of deposit is insured by the federal government for up to $100,000. The FDIC has been in existence for 75 years, and no one has ever lost a penny on an insured deposit -- and this will not change.
Once this crisis is resolved, there will be time to update our financial regulatory structures. Our 21st century global economy remains regulated largely by outdated 20th century laws. Recently, we've seen how one company can grow so large that its failure jeopardizes the entire financial system.
Earlier this year, Secretary Paulson proposed a blueprint that would modernize our financial regulations. For example, the Federal Reserve would be authorized to take a closer look at the operations of companies across the financial spectrum and ensure that their practices do not threaten overall financial stability. There are other good ideas, and members of Congress should consider them. As they do, they must ensure that efforts to regulate Wall Street do not end up hampering our economy's ability to grow.
In the long run, Americans have good reason to be confident in our economic strength. Despite corrections in the marketplace and instances of abuse, democratic capitalism is the best system ever devised. It has unleashed the talents and the productivity, and entrepreneurial spirit of our citizens. It has made this country the best place in the world to invest and do business. And it gives our economy the flexibility and resilience to absorb shocks, adjust, and bounce back.
Our economy is facing a moment of great challenge. But we've overcome tough challenges before -- and we will overcome this one. I know that Americans sometimes get discouraged by the tone in Washington, and the seemingly endless partisan struggles. Yet history has shown that in times of real trial, elected officials rise to the occasion. And together, we will show the world once again what kind of country America is -- a nation that tackles problems head on, where leaders come together to meet great tests, and where people of every background can work hard, develop their talents, and realize their dreams.
Thank you for listening. May God bless you.
END 9:14 P.M. EDT
Posted by Joyce Kavitsky at 9/24/2008 10:43:00 PM
McCain Puts Country First To Deal Hands On With Finance Burst In Capitol Hill; Obama Walks & Chews Gum On Campaign Trail
John McCain is suspending his campaign and wants to delay the first debate (now scheduled for Friday night) in order to focus on the financial crisis. Here are McCain's remarks as prepared for delivery in New York City today:
America this week faces an historic crisis in our financial system. We must pass legislation to address this crisis. If we do not, credit will dry up, with devastating consequences for our economy. People will no longer be able to buy homes and their life savings will be at stake. Businesses will not have enough money to pay their employees. If we do not act, ever corner of our country will be impacted. We cannot allow this to happen.
Last Friday, I laid out my proposal and I have since discussed my priorities and concerns with the bill the Administration has put forward. Senator Obama has expressed his priorities and concerns. This morning, I met with a group of economic advisers to talk about the proposal on the table and the steps that we should take going forward. I have also spoken with members of Congress to hear their perspective.
It has become clear that no consensus has developed to support the Administrations proposal. I do not believe that the plan on the table will pass as it currently stands, and we are running out of time.
Tomorrow morning, I will suspend my campaign and return to Washington after speaking at the Clinton Global Initiative. I have spoken to Senator Obama and informed him of my decision and have asked him to join me.
I am calling on the President to convene a meeting with the leadership from both houses of Congress, including Senator Obama and myself. It is time for both parties to come together to solve this problem.
We must meet as Americans, not as Democrats or Republicans, and we must meet until this crisis is resolved. I am directing my campaign to work with the Obama campaign and the commission on presidential debates to delay Friday nights debate until we have taken action to address this crisis.
I am confident that before the markets open on Monday we can achieve consensus on legislation that will stabilize our financial markets, protect taxpayers and homeowners, and earn the confidence of the American people. All we must do to achieve this is temporarily set politics aside, and I am committed to doing so.
Following September 11th, our national leaders came together at a time of crisis. We must show that kind of patriotism now. Americans across our country lament the fact that partisan divisions in Washington have prevented us from addressing our national challenges. Now is our chance to come together to prove that Washington is once again capable of leading this country.
Update: An announcement from Obama spokesman Bill Burton:
At 8:30 this morning, Senator Obama called Senator McCain to ask him if he would join in issuing a joint statement outlining their shared principles and conditions for the Treasury proposal and urging Congress and the White House to act in a bipartisan manner to pass such a proposal. At 2:30 this afternoon, Senator McCain returned Senator Obama’s call and agreed to join him in issuing such a statement. The two campaigns are currently working together on the details.
Update II: Obama's campaign says the debate is on.
Posted by Joyce Kavitsky at 9/24/2008 08:27:00 PM
Wednesday, September 24, 2008
Senator Obama is running an ad hitting John McCain for opposing equal pay for women. This is so dishonest. First of all, since the 1963 Equal Pay Act, is has been illegal to pay women differently for the same work. So no matter how much of a Neanderthal you think John McCain is, he can't block equal pay for equal work. It's been the law for 45 years.
The ad cites the statistic loved by liberals that women earn 77 cents for every dollar that men earn. This is such a phony statistic. As Carrie Lukacs pointed out last year, this stat says nothing about women's training and steady presence in the job force.
Yes, the Labor Department regularly issues new data comparing the median wage of women who work full time with the median wage of men who work full time, and women's earnings bob at around three-quarters those of men. But this statistic says little about women's compensation and the influence of discrimination on men's and women's earnings. All the relevant factors that affect pay -- occupation, experience, seniority, education and hours worked -- are ignored. This sound-bite statistic fails to take into account the different roles that work tends to play in men's and women's lives.Women are more likely than men to drop in and out of the job force in order to raise a family. They are less likely to work the overtime hours and travel out of town on business that might be necessary to climb the promotional ladder. Men are more likely to take the yucky or dangerous jobs that have higher salaries as compensation.
So what happens if we examine the statistics and control for such factors? Do women still earn less? Well, no.
When these kinds of differences are taken into account and the comparison is truly between men and women in equivalent roles, the wage gap shrinks. In his book "Why Men Earn More," Warren Farrell -- a former board member of the National Organization for Women in New York -- identifies more than three dozen professions in which women out-earn men (including engineering management, aerospace engineering, radiation therapy and speech-language pathology). Farrell seeks to empower women with this information. Discrimination certainly plays a role in some workplaces, but individual preferences are the real root of the wage gap.Of course, making women feel like victims is part of the liberal playbook so that they can then propose laws to protect the victims. Paying attention to what lies behind those figures would mess up the easy demagoguery of screaming about women earning less than men.
When women realize that it isn't systemic bias but the choices they make that determine their earnings, they can make better-informed decisions. Many women may not want to follow the path toward higher pay -- which often requires more time on the road, more hours in the office or less comfortable and less interesting work -- but they're better off not feeling like victims.
Obama's ad is deceptive. IF you didn't know anything about the issue, you'd think "Oh my gosh, that old geezer, McCain, wants to keep women earning less than men for equal work. What a chauvinist!" Of course, none of that is true.
The Obama campaign is referring to the Lilly Ledbetter case. She got a big play at the Democratic convention and her Supreme Court case has given the left a chance again to posture as the protectors of all those women supposedly earning three-quarters of what a man earns. Erin Sheley explains what is so wrong with the whole Ledbetter storyline.
Three weeks ago at the Democratic National Convention, Lilly Ledbetter delivered a soliloquy on "fair pay" for women--a cause the Democrats are certain to highlight in the coming weeks of this increasingly woman-centric campaign. She's the "grandmother from Alabama" and former supervisor at a Goodyear Tire and Rubber plant who sued the company in 1998 under Title VII of the Civil Rights Act of 1964, claiming gender-based wage discrimination. She was also a timely reminder of Barack Obama's views on judicial activism.Read the rest to understand what a phony issue this is.
In her convention speech, Ledbetter chided the Supreme Court for "sid[ing] with big business" by ruling that she "should have filed her complaint within six months of Goodyear's first decision to pay [her] less." The Lilly Ledbetter Fair Pay Act, a proposed amendment to Title VII that would have overturned the Supreme Court decision, failed in the Senate in April, but only after voting was delayed until 6 P.M. to give Barack Obama and Hillary Clinton time to return from the campaign trail and give impassioned speeches in support of the measure and pose for photo-ops with Ledbetter.
This casting of Lilly Ledbetter as feminist martyr, though, has serious problems. First, the High Court's decision in her case had nothing to do with gender discrimination as a substantive matter. It turned solely on the requirement that an employee must file a charge with the Equal Employment Opportunity Commission (EEOC) within 180 days of the discrimination occurring, which Ledbetter did not. Second, Ledbetter herself would not even have needed her namesake act
to avoid this requirement if her lawyer had pressed Ledbetter's claim under the existing Equal Pay Act of 1963 instead of under Title VII.
The McCain campaign's answer to the Obama ad is to point out that women occupy more senior positions in his senatorial office so that women who work for McCain actually earn more than those who work for Obama. This is also silly. Once again, this uses statistics without controlling for differences in the positions and seniority. And it really is a non sequitur. If women are upset by the Obama ad and thinking that they're getting paid less than a man for equal work, hearing that a few women working for McCain earn more than another anonymous group working for Obama isn't going to be much of a comfort. What matters to them is that they are being told that they earn only 77 cents for what a man earns. I'd much prefer that they answer the ad as it's presented and note all the deceptions contained in one short ad. Sure it takes longer to explain why that statistic is so stupid, but it would be worth it to answer a deception that liberals have been waving around for such a long time. Without that pushback, the fake statistic just sits out there and gets accepted as a fact indicating what a sexist society we live in.
Obama is trying to appeal to women whose support is less strong for him than for most recent Democratic presidential candidates. He's employing phony statistics and deceptive statements to do so. John McCain should take him head on and refute this malarkey.
Posted by Joyce Kavitsky at 9/24/2008 04:20:00 PM
Tuesday, September 23, 2008
Secretary of State Jennifer Brunner has a reputation as the most partisan state official in Ohio. And she works hard to earn it. The Democrat's latest stunt rejected absentee ballots for thousands of Republicans.
But it's not her first rodeo. Almost as soon as Brunner was elected in 2006, she tried to remove several Republican county elections officials, including Ohio Republican Party Chairman Robert Bennett. They accused her of "storm trooper tactics" to silence critics.
Then Brunner spread an alarm that Ohio's electronic voting machines were vulnerable to tampering - a favorite claim of the paranoid left. Elections officials who participated in Brunner's study called her conclusions over-hyped "leaps in logic" and said, "The report itself could be viewed as an attack on the elections system ... (that) planted seeds in the mind of the public to mistrust those who oversee elections."
Brunner also demanded an overhaul of voting methods just before the March primaries, causing meltdowns in some precincts.
And now she's hassling Republicans who want to vote for John McCain.
Two Hamilton County voters have sued, accusing her of "the disenfranchisement of thousands of voters."
The John McCain campaign sent out more than 1 million applications for absentee ballots to Republicans. Each had a line at the top next to a box: "I am a qualified elector."
Brunner sent a memo telling county election officials to reject those applications for absentee ballots if the box was not checked. "Failure to check the box leaves both the applicant and the board of elections without verification that the applicant is a 'qualified elector'," she wrote.
But that's contrary to state law and Brunner doesn't have the authority, according to the lawsuit and an opinion from Hamilton County's Republican Prosecutor Joe Deters.
Ohio law allows voters to request an absentee ballot on the back of a grocery sack if they want to, as long as they include their name, address, date of birth, signature and either a driver's license number, last four Social Security numbers or a valid picture I.D.
There is nothing in the law about checking a box to verify a qualified voter. The voter's signature is enough, because that's what is checked to send ballots, said Hamilton County Clerk of Courts Greg Hartmann, who ran against Brunner in 2006 and is now county chairman for the McCain-Palin campaign. "It's just bald partisanship," he said. "She's trying to disqualify likely McCain voters."
The Deters opinion said "it is equally reasonable that the squares are intended simply as bullet points in an inartfully designed application."
Brunner said, "While state law does not require a check box, the McCain-Palin campaign designed its form to require that voters check a box to affirmatively state they are qualified electors."
Sen. Gary Cates, R-West Chester didn't buy it. "This is not a time to give people the appearance that voters are being suppressed," he said.
Majority Floor Leader Sen. Tom Niehaus, R-New Richmond, said, "Take the politics out and you'd think the state's chief elections official would err on the side of allowing people to vote."
State law requires local officials to notify voters if their applications are rejected. That will cause confusion, especially for elderly absentee voters, Hartmann said. It's also costly and time consuming in an election year.
Since the Florida debacle in 2000, most states have made voting easier. Ohio now lets anyone get an absentee ballot. This year, Ohio could again decide a close election - and Brunner is inviting the kind of lawsuits and suspicions that destroy public trust.
She said Hamilton County "may face other lawsuits or even challenges to the rights of those whose applications they would process" if her memo is ignored.
Brunner's web site says she "wants to ensure that Ohio elections are free, fair, open and honest; and to encourage the highest level of participation in our democracy." So why reject 1,500 voters in Hamilton County and thousands more in Ohio?
An honest mistake? With Brunner's partisan record, not likely.
Laying litigation landmines to lawyer the outcome if Democrats don't win? That fits like a tinfoil hat with her irresponsible attack on Ohio's voting machines.
Raw partisanship? Ring the jackpot bell.
"Well, I tell you what, it helps in Ohio that we've got Democrats in charge of the machines," Barack Obama said on Sept. 3.
I think he was talking about Brunner - the partisan secretary of state who is doing her best to bring Chicago elections to Ohio.
Contact Enquirer columnist Peter Bronson at 513-768-8301 or email@example.com.
Posted by Joyce Kavitsky at 9/24/2008 02:34:00 PM
Posted: 3:51 am
September 24, 2008
HOW did America wind up in its worst financial crisis in decades? Sen. Barack Obama explained it this way last week: "When sub-prime-mortgage lending took a reckless and unsustainable turn, a patchwork of regulators systematically and deliberately eliminated the regulations protecting the American people."
That's exactly backward. Mortgage lending took that "reckless and unsustainable turn" because of regulation - regulation driven by liberals and progressives, not free-market "deregulators."
Pushed hard by politicians and community activists, the regulators systematically and deliberately altered financially sound lending practices.
The mortgage market was humming along just fine when, in the late 1980s, progressives decided that it needed to be "fixed." Their complaint: Some ethnic groups got approved for mortgages at lower rates than others.
In reality, mortgage lenders were simply being prudent - taking care to provide mortgages to those who could best afford to make the payments.
The shift began in 1989, when Congress amended the Home Mortgage Disclosure Act to force banks to collect racial data on mortgage applicants. By 1991, critics were using that data to paint lenders as racist by showing that minority applicants were approved at far lower rates. Banks were "Shamed By Publicity," as one 1993 New York Times headline put it.
In fact, they found a racial disparity only by ignoring relevant data on applicants' ability to make mortgage payments - such as their assets and credit history.
But the political pressure was intense - with few in politics or media eager to speak the truth. And then, in 1992, came a study from four researchers at the Boston Fed, which seemed to bear out the critics' contentions.
That study was, in fact, based on quite flawed data - but the authors' political, media and academic protectors stifled most serious criticism, smearing the reputation of one whistleblower and allowing the Boston authors to avoid answering serious academic challenges (mine included) to their work. Other studies with different conclusions were ignored.
The very next year, the Boston Fed announced new requirements for banks - rules that have now turned out to be monumentally catastrophic: Adopt "relaxed lending standards" or risk being labeled as racists, and face serious penalties under the federal Community Reinvestment Act.
Gone (as "arbitrary" and "outdated") were traditional lending requirements such as requiring a down payment or limiting mortgage payments to 28 percent of income. (Of course, the loosened lending standards weren't limited to poor and minority applicants - that would be discriminatory.)
The new standards performed as intended: Home- ownership rates, stagnant for 25 years, began a rapid 10-year ascent in 1995, with many new homeowners being lower-income and/or minority families.
The large rise in demand for houses, however, fed a run-up in prices starting in 1997 - the infamous housing bubble. And rising prices hid the great vulnerability of these loans to defaults and foreclosures, because refinancing or selling at a profit was the easy alternative.
Soon, these loans began to be sold in the secondary market. Fannie Mae and Freddie Mac were enthusiastic proponents of relaxed lending standards and purchased large swaths of these loans.
Time after time, Fannie and Freddie trumped criticism by pointing to how they were helping broaden homeownership. Because of the subject's racial overtones, they beat back calls for reform even after financial irregularities were found.
Rating agencies such as Standard & Poor's had no experience with such loans - and imprudently used the misleading bubble-induced performance to incorrectly judge the likely performance of financial instruments based on such loans.
In 2002, the "reformers" declared victory. In a Fannie report, four academic supporters of relaxed standards crowed how these changes were "fundamentally altering the terms upon which mortgage credit had been offered in the United States from the 1960s through the 1980s . . . These changes in lending herald what we refer to as mortgage innovation."
Now that the popped bubble has left us swimming in foreclosures, the supporters of loosened credit standards seem shy about taking credit for their "mortgage innovations." Instead, they blame subprime lenders for becoming "predatory" - when they were simply taking the Boston Fed rules to their logical conclusion while broadening the mortgage market.
Investors holding mortgage-based assets now want out. Perhaps they deserve a $700 billion refund - since they were sold a bill of goods by "progressive" politicians, academics and government officials who, in the hope of remaking society, insisted that loans based on relaxed underwriting standards were sound.
Stan Liebowitz is the Ashbel Smith professor of economics at the Business School at the University of Texas at Dallas.
Posted by Joyce Kavitsky at 9/24/2008 02:31:00 PM
FBI investigating companies at heart of meltdown
By LARA JAKES JORDAN, Associated Press Writer
Wed Sep 24, 8:00 AM ET
The FBI is investigating four major U.S. financial institutions whose collapse helped trigger a $700 billion bailout plan by the Bush administration, The Associated Press has learned.
Two law enforcement officials said Tuesday the FBI is looking at potential fraud by mortgage finance giants Fannie Mae and Freddie Mac, and insurer American International Group Inc. Additionally, a senior law enforcement official said Lehman Brothers Holdings Inc. also is under investigation.
The inquiries will focus on the financial institutions and the individuals that ran them, the senior law enforcement official said.
The law enforcement officials spoke on condition of anonymity because the investigations are ongoing and are in the very early stages.
Officials said the new inquiries bring to 26 the number of corporate lenders under investigation over the past year.
Spokesmen for AIG, Fannie Mae and Freddie Mac did not immediately return calls for comment Tuesday evening. A Lehman spokesman did not have an immediate comment.
Just last week, FBI Director Robert Mueller put the number of large financial firms under investigation at 24. He did not name any of the companies under investigation but said the FBI also was looking at whether any of them have misrepresented their assets.
Over the past year as the housing market cratered, the FBI has opened a wide-ranging probe of companies across the financial services industry, from mortgage lenders to investment banks that bundle home loans into securities sold to investors. Mueller has previously said the FBI's hunt for culprits in the nation's subprime mortgage crisis focused on accounting fraud, insider trading, and failure to disclose the value of mortgage-related securities and other investments.
The investigations revealed Tuesday come as lawmakers began considering whether to approve emergency legislation that would give the government broad power to buy up devalued assets from troubled financial firms.
The bailout proposed by the Bush administration is aimed at helping unlock credit and stabilize badly shaken markets in the United States and around the globe.
In the past two weeks, the government has taken over Fannie Mae and Freddie Mac, the country's two biggest mortgage companies, with a bailout plan that could require the Treasury Department to put up as much as $100 billion for each of them over time if needed to keep them afloat as mortgage losses mount.
Last week, the Federal Reserve provided an emergency $85 billion loan to AIG, which teetered on the brink of bankruptcy. Lehman Brothers was forced to file for bankruptcy after attempts to engineer a private rescue fell apart. All the companies were laid low from bad bets on complex mortgage-related securities.
Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke made the joint decision last week that the only way to stop the carnage was to deal with the root cause of all the troubles, billions of dollars of bad mortgage debt sitting on the books of major financial companies. This debt has triggered the worst credit crisis in decades, causing credit markets to essentially freeze up despite the fact that the Fed joined with major central banks around the world to pump billions of dollars of reserves into the financial system.
Additionally, the FBI is investigating failed bank IndyMac Bancorp Inc. for possible fraud. Countrywide Financial Corp., formerly the nation's largest mortgage lender and now owned by Bank of America Corp., is also under scrutiny.
Copyright © 2008 The Associated Press. All rights reserved.
Bill's Comment: I am glad that the FBI is doing something. I feel this way because we all know that the Democrat-controlled Congress will do absolutely nothing, because their fingerprints are all over this. The only reason why they are dragging their feet, in regards to the bailout bill, is because they want to control the money flow of it, and not to leave it to the Treasury Department.
SEPTEMBER 2, 2008
John McCain's tax policies are designed to create jobs, increase wages and allow all Americans -- especially those in the hard-pressed middle class -- to keep more of what they earn. His plan achieves these goals in three important ways.
First, he proposes a package of tax incentives that will create jobs and raise earnings by inducing firms to invest more in the U.S. Second, he is strongly committed to blocking any increase in tax rates while doubling the personal exemptions for families with children, which will reduce the tax burden on working Americans. Third, he proposes a new, refundable tax credit that will increase health-care coverage, reduce the cost of health care, and provide more funds for families and individuals to purchase health care.
Here's how the three components of Sen. McCain's tax plan will work in practice.
To create jobs, Mr. McCain will reduce the corporate tax rate -- now at 35% the second highest among all industrial countries -- to one that doesn't penalize firms for doing business here. To encourage small businesses to expand, he will fight against higher tax rates on their income.
To increase wages, Mr. McCain will provide incentives to raise productivity, which leads to higher wages. To increase productivity, he will provide incentives for developing and applying new technologies by expanding the tax credit for research and development, and by making that credit permanent.
More savings and investment in businesses also raise productivity. Mr. McCain will stimulate saving by keeping tax rates low on the returns to saving in the form of dividends and capital gains. He will also allow faster depreciation of assets, which encourages investment. And he will strengthen the incentive to save by reducing the maximum estate tax rate, with a substantial, untaxed exemption.
In stark contrast to Barack Obama, Mr. McCain believes that tax policy should be used to foster the creation of jobs and higher wages through economic growth, rather than to redistribute incomes. The economy is not a zero-sum game in which some people can enjoy higher incomes only if others are made worse off.
Mr. McCain's plan will significantly ease the tax burden on American families with children by doubling the personal exemption to $7,000 from $3,500. This means a larger percentage tax reduction for families with smaller taxable incomes, and specifically helps families in the middle income levels. And a President McCain will enable people to keep more of their earnings by preventing Congress from raising tax rates.
Mr. McCain's overall tax policy will also expand health-insurance coverage, and make health care more efficient. Most taxpayers will also pay less in tax. Here's how it will work. His plan includes a refundable tax credit of $2,500 for single individuals and $5,000 for couples, if they receive a qualifying health-care policy from an employer (one that includes adequate coverage against large medical bills), or buy a qualifying policy on their own. The credit will replace the current tax rule, which excludes employer payments for health insurance from employees' taxable incomes.
This tax credit will be available to everyone, including the self-employed and the employees of businesses that do not provide health insurance. Thus it will lead to a major expansion of health-insurance coverage. The tax credit will of course be available to people who are between jobs, or have retired before they're eligible for Medicare.
Since any part of the credit not used to pay for insurance could be invested in a health savings account, individuals will have an incentive to choose less costly health-insurance policies. This will improve the efficiency of health care, to everyone's benefit.
Importantly, the tax credit will be a clear gain for most employees. Consider a married taxpayer whose employer now pays $10,000 for a health-insurance policy. Ending the exclusion will raise that individual's taxable income by $10,000 -- but the $5,000 tax credit will exceed the extra tax liability whether the marginal tax rate that individual pays is 10% or 35% or anywhere in between. Indeed, the lower the taxpayer's income, the more of the credit that will be available to pay for health care that's not reimbursed by insurance.
Sen. Obama was at best disingenuous in his convention speech when he criticized the McCain plan for taxing health benefits. The health insurance tax credit exceeds the extra taxes on existing benefits.
Mr. Obama also criticized Mr. McCain on the grounds that he doesn't cut taxes on 100 million families. But this ignores the fact that Mr. McCain's health-insurance credits would benefit most taxpayers and that many people who are not currently eligible for the increased personal exemption will become eligible when they have children. When these features are taken into account, the vast majority of today's 140 million taxpayers would pay lower taxes under the McCain plan.
Tax revenues will increase robustly over the next few years with Mr. McCain's overall tax strategy as the economy grows -- even with conservative economic growth assumptions. And by maintaining strong control over the growth of government spending, Mr. McCain will bring the budget into balance. His long record of fighting against excessive government spending, his plans to veto earmarks and reverse the spending binge of the past few years, and his strong commitment to balancing the budget can make this goal a reality.
Mr. McCain's tax policy stands in strong contrast to Mr. Obama's ever-changing tax proposals. Although it is difficult to know just what Mr. Obama would do if he were elected, it is clear that he wants to raise taxes on personal incomes, on dividends, on capital gains, on payroll income and on businesses -- all of which will hurt the U.S. economy. He regards the tax system as a way to redistribute income, and disregards the resulting adverse incentive effects that reduce employment and economic growth.
Mr. Obama's claim to being a big tax cutter defies credibility. His assertion that he would cut taxes on 95% of families reflects his one-time $1,000 rebate payouts, and a variety of new government spending handed out through the tax system.
Mr. McCain, on the other hand, has been clear that he wants to preserve the favorable incentive effects of the existing low tax rates -- and to reduce taxes in other ways that will strengthen the economy, create jobs and help current taxpayers, including those without health insurance.
Messrs. Feldstein and Taylor are economic advisers to John McCain and professors of economics at, respectively, Harvard and Stanford.
Posted by Joyce Kavitsky at 9/24/2008 10:45:00 AM
Tuesday, September 09, 2008 By: RJC Press Office
Smear: Democrats lie about Governor Palin supporting Pat Buchanan for President
Facts: Gov. Sarah Palin endorsed Steve Forbes in 1996 and 2000, not George W. Bush or Pat Buchanan. While Mayor of Wasilla, AK, Gov. Palin had a policy that if a candidate came to her city, she would wear that button on the day they were there. Pat Buchanan came to Wasilla so the day he came, she wore a button. On July 26, 1999, then-Mayor Palin wrote the Anchorage Daily News to clarify the record because a wire service story the paper had published nine days before "may have left your readers with the perception that I am endorsing" Buchanan because she had welcomed his visit to her town. "As mayor," she explained, "I will welcome all the candidates in Wasilla." (Anchorage Daily News, 7/26/99)
Smear: Democrats lie about Governor Palin endorsing the views of a Jews for Jesus speaker that spoke once in her church.
Facts: Gov. Palin did not know this speaker would be at her church and emphatically rejects his views.
This is based on concerns about a sermon presented last month at the church she usually attends. The Jewish news agency JTA investigated and reported that 1) Palin would have had no way of knowing that this person would be speaking at church that day, 2) Palin rejects the Christian speaker's offensive views, and 3) Abraham Foxman, national director of the Anti-Defamation League, has seen "no evidence" that she shares those views. (JTA, 9/3/08)
Also, this speaker spoke once at Palin's church. Democrats should be cautious when their candidate, Barack Obama, embraced an anti-American, anti-Semitic pastor, Rev. Jeremiah Wright who was both a personal friend and mentor for 20 years. Democrats are absolutely attempting to smear Gov. Palin with distorted facts. Democrats are doing a disservice to themselves if they think with one or two distorted facts that they can fool the Jewish community.
Smear: Democrats lie about Governor Palin censoring library books.
Facts: The Anchorage Daily News found that then-Mayor Palin never proposed to ban a single book. (Anchorage Daily News, 9/4/08) All other rumors and innuendo on this topic are outright smears.
Smear: Democrats lie about Governor Palin seeking to have creationism taught in public schools.
Facts: Gov. Palin took no action to add creationism to the state's curriculum throughout her term in office. The Associated Press investigated and found that Gov. Palin "kept her campaign pledge not to "push the State Board of Education to add creation-based alternatives to the state's required curriculum or look for creationism activists when she appointed members." The AP also quoted a political observer in the state who observed, "She has basically ignored social issues period." (Associated Press, 9/3/08)
Posted by Joyce Kavitsky at 9/24/2008 10:31:00 AM
By TERRY JONES
INVESTOR'S BUSINESS DAILY | Posted Tuesday, September 23, 2008 4:30 PM PT
For those looking for a real start to today's financial meltdown and government rescue, you need to go back — way back — to 1977, and the Jimmy Carter presidency.
IBD Exclusive Series: What Caused The Loan Crisis?
It was then, for the best and purest of reasons, that well-meaning Democratic members of Congress brought the Community Reinvestment Act into being.
The main idea, as the late Democratic Sen. William Proxmire said on the Senate floor in 1977, was "to eliminate the practice of redlining by lending institutions."
That term — "redlining" — seems quaint today. But in the 1970s, it was widely seen as the cause of housing disparities between white and black Americans.
The redlining theory went thus: Banks set up shop in low-income areas, took deposits, then lent the funds to richer areas — leaving poor and minority communities starved of housing and capital.
President Carter, a reformist former governor from the racially aware "New South," embraced the 1977 CRA as a way to end the supposed practice of redlining.
Coming as it did just years after other major civil rights legislation — including the 1964 Civil Rights Act, the Fair Housing Act of 1968 and the Equal Credit Opportunity Act of 1974 — community activists and others viewed it as essential to bringing African-Americans into the American dream.
At the time, the U.S. was in the middle of what came to be known as stagflation. After the first oil embargo in 1973 sent prices spiraling upward, the economy struggled to emerge from a vicious two-year recession in 1974 and 1975.
By 1977, inflation hit 7% — on its way to 14% in 1980. A year earlier, in 1976, 30-year mortgage rates crested 9% for the first time ever.
Meanwhile, the jobless rate stood at 7% — 14% for blacks. Many African-Americans felt frozen out of homeownership. As home prices soared, affordability became a crisis for black families.
In such a nasty economic environment, it's easy to see why something like the CRA got passed.
Good intentions, bad results.
Unfortunately, this well-intended law eventually led to a housing boom based on shoddy loan practices, a subsequent bust, and the financial mess we are in today.
Initially, the CRA was supposed to not just lend to poor areas, but to do so "consistent with safe and sound lending practices." That latter key proviso was ignored as CRA was implemented.
As IBD has already shown, the CRA forced banks and savings institutions — then, far more heavily regulated than today — to make loans to poor, often uncreditworthy minority borrowers.
Banks were required to keep extensive records of their minority lending practices. Those that didn't pass muster could be denied the right to expand their branches, merge with other banks, or boost lending in new markets.
Regulators didn't need to do much policing; they let that job fall to radical community groups, such as ACORN and NACA, which siphoned literally billions of dollars from banks and lent the money in poor communities.
It wasn't entirely altruistic.
The community groups booked thousands of dollars in fees for every loan. And loans often required recipients to become active in radical causes — what's today called "community organizing."
If a community group decided a bank was operating in bad faith, it could affect the bank's "CRA rating" — the scorecard for how well it was doing as a minority lender.
Banks became pliable, easy targets. No bank CEO wanted to be mau-maued as an enemy of the poor. They became shakedown targets, channeling billions of dollars to groups that had, at best, meager results to show for it.
That's how it began. Later, in the Clinton era, Fannie Mae and Freddie Mac got involved — buying up bad loans from banks, and securitizing them for sale on world markets. The seeds of the subprime meltdown were planted.
As of last year, the homeownership rate among all Americans was 68.1% — up from 63% in 1970. For black Americans, it's up from just below 42% in 1970 to 47.2% last year. It's still below 50%, and still the lowest of any minority group.
Today, Americans might rightly ask 31 years after the CRA was passed whether the more than $1 trillion lent under its auspices did what its proponents promised.
Posted by Joyce Kavitsky at 9/24/2008 08:29:00 AM
By INVESTOR'S BUSINESS DAILY | Posted Tuesday, September 23, 2008 4:20 PM PT
Energy Policy: With nearly 70% of voters demanding more domestic oil, the Democratic Congress is about to sneak a new drilling ban into a must-pass government funding bill while claiming it supports drilling.
Read More: Energy
Earlier this month, Rasmussen Reports found that 69% of voters support offshore oil drilling. That's no wonder, with fuel prices still painfully high and widespread concerns that America is becoming dangerously dependent on oil-rich foreign nations with ties to Islamic terrorists in the Middle East and hostile regimes like that of leftist Hugo Chavez in Venezuela.
The do-nothing Democratic Congress may not have passed an appropriations bill all year long, but it's now in a position in which inaction would actually serve the public good.
At the end of this month, the quarter-century-long ban on oil and gas leasing on most of the Outer Continental Shelf (OCS) expires. With 97% of our offshore lands sitting unleased, the United States is in the dubious position of being the only industrialized country in the world that restricts access to so much of its offshore resources.
Considering public outrage over high prices at the pump, you'd think the people's representatives would be eager to carry out the public will and let the outdated ban expire especially since in the 21st century the exploration and extraction of oil is no longer the dirty, ecologically risky business it once was.
In July, President Bush lifted the executive branch's longtime ban on offshore drilling. That placed the ball squarely in the court of the Democratic Congress, which must renew the ban every year in the form of appropriations legislation in order to keep the drilling prohibition in effect.
But when it comes to Democratic Party bosses in Congress, such as House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid, the vox populi always seems to get shouted down by the special interests to which their party is enthralled. In this case, it's enviro-extremists who think Barack Obama was right when he recommended an energy policy of everyone checking the air in their tires.
Wind, sun, corn, hydrogen these forms of energy are obviously in our long-term future as substitutes for petroleum. But Democrats refuse to accept that the desperately needed remedy to our short-term and intermediate-term energy woes is more of our own oil and gas now.
And so they are using the massive, end-of-the-fiscal-year "continuing resolution" to try to get Pelosi's "Kill Drill" legislation enacted into law. By attaching it to a must-pass budget measure, they hope to force President Bush to sign, convince voters that Democrats have "done something" about drilling, and thus neutralize the biggest political issue of the year for John McCain and congressional GOP candidates.
It won't wash. Pelosi's "Comprehensive American Energy Security and Consumer Protection Act" actually bans drilling in places where we know the oil and gas are. It prohibits drilling within 50 miles of our coasts.
The House bill deprives the states from sharing in royalty revenues a strong built-in disincentive for state governments, whose legislatures would have to approve drilling off the state coast separately from Congress.
The measure's provisions for utilizing oil shale reserves in Western states are tepid at best. The legislation does nothing to encourage more use of nuclear power. Yet it will raise oil prices by taxing oil companies to the hilt to pay for subsidies and tax breaks for research into green alternatives to oil that are too expensive and still at the drawing-board stage.
With Congress scheduled to take yet another recess later this week for final campaigning before Election Day, defeat of this latest attempt to pass a drilling-bill-that-isn't would likely mean the matter is being handed on to the next Congress and the next president. That is to be fervently hoped for, because what Sen. Reid and Speaker Pelosi are trying to do is pretend they are responding to the people's demands for more domestic oil when they actually are doing the opposite.
The voters will have to elect a far different Congress this November to see a real drilling bill become law.
Posted by Joyce Kavitsky at 9/24/2008 08:25:00 AM