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Politics : Liberalism: Do You Agree We've Had Enough of It? -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (76424)	12/16/2009 1:43:49 PM
From: JakeStraw	5 Recommendations Read Replies (1) \| Respond to of 224744

According to CNN polling done after the conclusion of Obama’s second 100 days... Out of four questions asked about Obama, the results were as follows: Obama’s handling of the economy: C- Obama’s handling of health care reform: D Obama’s handling of foreign affairs: C Obama’s overall rating: C- examiner.com

To: Kenneth E. Phillipps who wrote (76424)	12/16/2009 1:49:24 PM
From: FJB	4 Recommendations Read Replies (1) \| Respond to of 224744

CNN/Opinion Research has disapproval at 50%. The numbers continues to plummet with no end in sight. He will be universally reviled this time next year.

To: Kenneth E. Phillipps who wrote (76424)	12/16/2009 1:50:41 PM
From: JakeStraw	4 Recommendations Read Replies (2) \| Respond to of 224744

Like the President Calling the Kettle Black examiner.com There is truly no greater hypocrisy than Washington hypocrisy, and never has that been so true then it has been with the current White House administration. Since taking office, President Barack Obama has made multiple hypocritical statements in his various teleprompter readings and interviews. His weekly address this past Saturday was no exception to that rule. The focus of this week’s address was reforming the financial industry. He noted that the financial crisis was created in part because of “the irresponsibility of large financial institutions on Wall Street that gambled on risky loans and complex financial products, seeking short-term profits and big bonuses with little regard for long-term consequences.” He continued by noting that “their actions…intensified the cycle of bubble-and-bust…” One could argue that Obama could well have been describing his ‘Cash for Clunkers’ program. While that program offered no inherent risk to Obama and/or the auto companies, it was clearly a loss for the American taxpayers who had to pay for that short-term bubble to a dying domestic industry. But that is just the first hypocrisy in Obama’s address, and a minor one at that. Obama later explains that new financial industry rules passed by the House and being currently discussed in the Senate would “bring new transparency and accountability to the financial markets.” How would a president who has allowed the Congressional Democrats and members of his administration to put together nearly all of their major policy proposals behind closed doors know anything about transparency? And his penchant for blaming every problem that has occurred this year on the previous administration raises the issue of what he would know about accountability as well. For anyone in Washington to point a finger at others and question their motives is the absolute highest form of hypocrisy. This current administration is perhaps the biggest but certainly not the only example of that. So far it has passed an $800 billion economic stimulus bill which has failed to accomplish most, if any, of its stated objectives. It has put forth budget plans which will assure the nation of budget deficits in excess of over $1 trillion for the foreseeable future. And it is now engaging in the art of deceit by telling the American people that it can provide universal healthcare coverage to all Americans and cut hundreds of billion from Medicare while simultaneously reducing the cost for everyone and not increasing the deficit. As the White House Press Secretary might say, “Only a third-grader with a crayon would write up something so unbelievably irresponsible.” But the real hypocrisy of Obama’s criticism of the financial industry is in the basic fact that it is untrue. For decade after decade, financial institutions were very responsible and quite conservative in the way they conducted their business dealings. There was the old saying that “Banks only lend money to those who don’t need it.” That is how they were able to maintain profits while also keeping their risk-exposure at a minimum. Of course, that all changed in 1995. That was the year in which the Clinton Treasury Department radically changed the provisions of the Community Reinvestment Act and essentially began forcing banks to make risky loans to consumers who may not be able to repay them. They heavily increased the amount of regulation on banks, but rather than being the kinds of regulations designed to protect consumers and/or banks from themselves these new regulations did the exact opposite. They also allowed community organizations like NACA (Neighborhood Assistance Corporation of America) and the now infamous ACORN to get involved in the banking industry – mainly by further forcing banks to make loans to low-income earners. Obama though, while either ignoring that history to protect his party and his supporters or simply lacking knowledge of it, tries over and over to place the blame for the financial crisis on the previous administration and/or on Republicans. In his weekly address, he even referred to Republicans as ‘agents’ for the financial industry’s special interests. However, clearly those in the financial industry gained far more by Clinton’s actions than they ever did under Republican leadership. As an example, Citigroup’s stock price in February 1984 was $2.03 per share. Shortly after Clinton took office in February 1993, the price had risen to $4.57. In February 1995, it was at $6.48. But from that date until February 2001 when Clinton was out of office, the stock price had risen to $49.18. After six years of the Bush Administration, Citigroup’s stock price was just $50.37 in February 2007, after it should have supposedly exploded due to the housing boom. And then of course by February 2009, it had tanked to $1.50 per share as a result of the financial collapse. Similar results can be seen in the chart below for another major financial institution in J.P. Morgan Chase. Also shown are the stock trends for two of the biggest actual culprits in the financial crisis, Fannie Mae and Freddie Mac. They are of course the two government-backed mortgage clearinghouses which were buying all of those risky loans that the banks were being forced to make. As is the case with any government or quasi-government institution (like the Postal Service or the proposed ‘public option’ healthcare plan), their incentive to be good financial stewards is diminished because they know that they can always use taxpayer dollars to bail them out, which is of course exactly what ended up happening. Keep in mind that the financial institutions could not have made and sold all of those risky loans if they did not have Fannie Mae and Freddie Mac standing ready to guarantee and purchase them. Stock Prices for Various Financial Institutions Citigroup JP Morgan Fannie Mae Freddie Mac Feb -84 2.03 11.14 1.01 --- Feb-93 4.57 13.5 16.61 10.32 Feb-95 6.48 13.38 17.33 13.53 Feb-01 49.18 46.66 79.70 65.85 Feb-07 50.37 49.39 56.76 64.93 Feb-09 1.50 22.85 .42 .42 So Obama can try to blame the financial crisis on the financial industry or on Republicans, but it was clearly intrusive government regulation, under the guise of social engineering, that was the true cause of the collapse. Certainly the banks played a role but it was the Clinton Administration which essentially forced the financial institutions to poke holes in their own floodwalls. When those small holes did not cause the banks any major negative effects, they then opened them completely at their own peril. Back to Obama, in another part of his weekly address he states that “We can’t change that history. But we have an absolute responsibility to learn from it, and take steps to prevent a repeat of the crisis from which we are still recovering.” Of course, his administration has been trying to spur financial institutions, which have resorted back to their old conservative and risk-adverse ways of doing business, to once again open up their lending policies to those who may or may not be able to repay their loans. All that is missing now is the actual enforcement of those directives in the same way the Clinton Administration started doing back in 1995. Instead of giving lectures to and pointing fingers at those who were doing things correctly in the first place, perhaps Obama should first spend a little bit of time brushing up on his economic history and avoid placing blame at those who only did wrong when coerced to do so by the federal government. The financial crisis is just another example of how government intervention is more often the cause of America’s problems rather than being the solution for them (as Reagan so eloquently stated). And Obama trying to lay the blame for the financial crisis at the feet of those in the financial industry is just another example of him using blatant hypocrisy in an attempt to cover-up the mistakes of those in Washington, primarily those from his own party.