Bryan Fischer
What if the bailout doesn't work?
By Bryan Fischer
In typical congressional fashion, the bailout bill, which was three pages long last week, expanded to a gargantuan 450 pages by the time it passed the U.S. Senate last night.
Sen. Mike Crapo voted against this monstrosity while Sen. Larry Craig voted for it.
Regardless of all the trinkets that were added, it still at heart is a $700 billion taxpayer-funded buyout for horribly bad mortgages the federal government pressured lenders to underwrite under threat of punishment. Ordinary taxpayers are being forced to bail everybody out because there are no other patsies who can be found to take the fall.
Credit-worthy customers are now being denied loans because the federal government forced lenders to give so much money to non-credit-worthy customers. And no proposal I have seen relaxes the pressure on mortgage lenders to continue making bad housing loans. Have you seen anything like that? I haven't, which means the fundamental problem, the thing that got us into this jam in the first place, isn't getting addressed at all.
As I wrote last week, the FHA is still sending letters, even after the $300 billion bailout of Fannie Mae and Freddie Mac, promising prospective clients that Fannie Mae will back mortgages that will be awarded without consulting credit scores and for which there is no income limitation and no required down payment.
The House will vote on this bailout bill tomorrow. Rep. Sali's spokesman, Wayne Hoffman, indicated that Sali is likely to vote against the bailout again, just as he voted against the original bailout bill on Monday. Rep. Simpson, who could not be reached by the Statesman, will likely vote for it, even though (because?) it is even more expensive and bloated than the first one.
The new and improved bill contains another $20 billion in spending, including a $6 million dollar subsidy for a company that makes wooden arrows.
A bleak Washington Times article details the problems that are being experienced in all sectors of the economy — not just finance and banking but in the housing, automotive and manufacturing sectors as well — and includes an assessment that investors, particularly overseas, are skeptical that the bill will actually provide any substantive help at all.
And, if this indeed is the "rescue" bill we're being told it is, why is the Dow down over 200 points as I write, and why did the Dow go up 500 points when the first bailout bill got flushed by the House? Perhaps investors suspect that the bill will actually do more harm than good to the economy, and the pundits are wrong when they say the bailout will restore confidence to the markets. It may in fact have the opposite effect.
Big government intervention in the wake of the Great Depression extended the depression by almost a decade, when allowing the free market to work would have pulled the economy out of its slump and soon restored it to health.
Dave Ramsey's "Common Sense Fix" plan relies on the free market, by eliminating the capital gains tax, eliminating the mark-to-market accounting mechanism for performing assets, and asking taxpayers to insure bad loans rather than buy them, still not a good deal but something that can be done at just 5% of the cost.
So the question which, in the midst of all this panic and hysteria, no one is asking is this: What if the bailout bill doesn't work? What then? What if you soak taxpayers for a $1 trillion plus and that's still not enough to plug the leak? Do you come after taxpayers again and again to pay for the misdeeds of the federal government, until they are completely bled dry and the future of their children and grandchildren is mortgaged up to their eyeballs? What then?
PALIN'S PROBLEM IN TONIGHT'S DEBATE: SHE'S TETHERED TO MCCAIN
The McCain camp made a significant miscalculation in letting Gov. Palin sit down with Charlie Gibson and Katie Couric. Her stumbling performance with Couric in particular made Couric look like a serious journalist, no small feat in and of itself.
Gov. Palin has conservative instincts, and Sen. McCain does not. But as second on the ticket, Palin is forced to adapt her message so she does not repudiate the positions her boss holds, even though he is wrong on such things as the bailout bill, the cause of the financial crisis, drilling in ANWR, global warming, embryonic stem cell research and a list of other issues.
I fear that Palin will be so hamstrung trying to echo the senator's message that she will perform poorly tonight. I don't see how the McCain campaign can turn her loose to be herself, because she might make McCain look bad, and if she continues to rummage around in her brain trying to retrieve talking points stuffed in there by her handlers, she will continue to look like she's out of her league on the big stage.
To make matters worse, moderator Gwen Ifill has an unconscionable conflict of interest, with her laudatory book on Obama due to come out on inauguration day. She therefore has a financial and intensely personal stake in making Palin look as bad as possible. As one observer said, in court this would be grounds for a mistrial.
Sen. McCain, rather than insisting that Ifill be replaced by an impartial moderator, made soothing noises and said such nice things about Ifill's professionalism that she now has license to go for Palin's jugular. McCain at times makes such an effort to reach out to his political adversaries that he falls off the edge into the chasm he mistakes for an aisle.
If she can manage to focus her remarks on Obama's record and platform, Gov. Palin may survive and even thrive. In the meantime, conservatives will hold their breath and hope for the best.
© Bryan Fischer
In typical congressional fashion, the bailout bill, which was three pages long last week, expanded to a gargantuan 450 pages by the time it passed the U.S. Senate last night.
Sen. Mike Crapo voted against this monstrosity while Sen. Larry Craig voted for it.
Regardless of all the trinkets that were added, it still at heart is a $700 billion taxpayer-funded buyout for horribly bad mortgages the federal government pressured lenders to underwrite under threat of punishment. Ordinary taxpayers are being forced to bail everybody out because there are no other patsies who can be found to take the fall.
Credit-worthy customers are now being denied loans because the federal government forced lenders to give so much money to non-credit-worthy customers. And no proposal I have seen relaxes the pressure on mortgage lenders to continue making bad housing loans. Have you seen anything like that? I haven't, which means the fundamental problem, the thing that got us into this jam in the first place, isn't getting addressed at all.
As I wrote last week, the FHA is still sending letters, even after the $300 billion bailout of Fannie Mae and Freddie Mac, promising prospective clients that Fannie Mae will back mortgages that will be awarded without consulting credit scores and for which there is no income limitation and no required down payment.
The House will vote on this bailout bill tomorrow. Rep. Sali's spokesman, Wayne Hoffman, indicated that Sali is likely to vote against the bailout again, just as he voted against the original bailout bill on Monday. Rep. Simpson, who could not be reached by the Statesman, will likely vote for it, even though (because?) it is even more expensive and bloated than the first one.
The new and improved bill contains another $20 billion in spending, including a $6 million dollar subsidy for a company that makes wooden arrows.
A bleak Washington Times article details the problems that are being experienced in all sectors of the economy — not just finance and banking but in the housing, automotive and manufacturing sectors as well — and includes an assessment that investors, particularly overseas, are skeptical that the bill will actually provide any substantive help at all.
And, if this indeed is the "rescue" bill we're being told it is, why is the Dow down over 200 points as I write, and why did the Dow go up 500 points when the first bailout bill got flushed by the House? Perhaps investors suspect that the bill will actually do more harm than good to the economy, and the pundits are wrong when they say the bailout will restore confidence to the markets. It may in fact have the opposite effect.
Big government intervention in the wake of the Great Depression extended the depression by almost a decade, when allowing the free market to work would have pulled the economy out of its slump and soon restored it to health.
Dave Ramsey's "Common Sense Fix" plan relies on the free market, by eliminating the capital gains tax, eliminating the mark-to-market accounting mechanism for performing assets, and asking taxpayers to insure bad loans rather than buy them, still not a good deal but something that can be done at just 5% of the cost.
So the question which, in the midst of all this panic and hysteria, no one is asking is this: What if the bailout bill doesn't work? What then? What if you soak taxpayers for a $1 trillion plus and that's still not enough to plug the leak? Do you come after taxpayers again and again to pay for the misdeeds of the federal government, until they are completely bled dry and the future of their children and grandchildren is mortgaged up to their eyeballs? What then?
PALIN'S PROBLEM IN TONIGHT'S DEBATE: SHE'S TETHERED TO MCCAIN
The McCain camp made a significant miscalculation in letting Gov. Palin sit down with Charlie Gibson and Katie Couric. Her stumbling performance with Couric in particular made Couric look like a serious journalist, no small feat in and of itself.
Gov. Palin has conservative instincts, and Sen. McCain does not. But as second on the ticket, Palin is forced to adapt her message so she does not repudiate the positions her boss holds, even though he is wrong on such things as the bailout bill, the cause of the financial crisis, drilling in ANWR, global warming, embryonic stem cell research and a list of other issues.
I fear that Palin will be so hamstrung trying to echo the senator's message that she will perform poorly tonight. I don't see how the McCain campaign can turn her loose to be herself, because she might make McCain look bad, and if she continues to rummage around in her brain trying to retrieve talking points stuffed in there by her handlers, she will continue to look like she's out of her league on the big stage.
To make matters worse, moderator Gwen Ifill has an unconscionable conflict of interest, with her laudatory book on Obama due to come out on inauguration day. She therefore has a financial and intensely personal stake in making Palin look as bad as possible. As one observer said, in court this would be grounds for a mistrial.
Sen. McCain, rather than insisting that Ifill be replaced by an impartial moderator, made soothing noises and said such nice things about Ifill's professionalism that she now has license to go for Palin's jugular. McCain at times makes such an effort to reach out to his political adversaries that he falls off the edge into the chasm he mistakes for an aisle.
If she can manage to focus her remarks on Obama's record and platform, Gov. Palin may survive and even thrive. In the meantime, conservatives will hold their breath and hope for the best.
© Bryan Fischer
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