The Libertarians’ Lament

What do you really know about Obama???s economic philosophy? Since he has never run a town, state or business, he has no record to look at. Oh, he has made lots of promises, but given that he broke his promise to be limited to public campaign funds, you can???t put much faith in that, and there will be means to keep those promises anyway.

But you do know that Obama, along with his democratic buddies in Congress, personally and professionally advocated for a residential housing policy favoring forced sub-prime lending, which subsequently resulted in massive defaults and foreclosures, leading to your loss of significant equity value in your home, to the point that it destabilized your banks, which panicked the stock market, which wiped out your savings.

Look and listen to Obama for yourself. Obama in this video, addressing his community activist work and his work representing ACORN in litigation against the banks and relating to the Community Reinvestment Act, and addressing the failure of Freddie Mac and Fannie Mae as those actions relate to the destruction of our economy by causing the current real estate and subsequent financial crisis, states that, and I quote:

"Subprime lending started out as a good idea, helping Americans buy homes who previously could not afford to. Financial institutions created new financial instruments that could securitize these loans, slice them into finer and finer risk categories, and spread them out among investors and around the country, as well as around the world. In theory, this should have allowed mortgage lending to be less risky, and more diversified."

Acknowledging the catastrophe, but as apologist for the Democrats, Obama then offers this justification.

"The original idea was a good one, which was, lets see if we can distribute risk more broadly, and make it easier to provide loans to people who otherwise might not be able to get one."

Yah, great idea. Economically unsound, but embraced by Obama. Listen for yourself. You cannot dispute the mans on words recorded live:

http://www.youtube.com/watch?v=Lr1M1T2Y314&feature=related

Below is a link to C-SPAN video clips of the Congressional hearings at roughly the time McCains attempt at S.190. to fix Fannie and Freddie. See for yourself who said what.

http://www.youtube.com/watch?v=_MGT_cSi7Rs

See also
http://www.newsweek.com/id/164732 from this web site. (oops!) stating that Freddie Mac was spending tax payer money to target Republicans in 2005 who were trying to regulate Fannie and Freddies fraud. Democrats were not targeted, as the were all in the tank with Fannie and Freddie to kill the regulations. Hear that, the article admits that Republicans were trying to regulate Freddie and Fannie, and Democrats were trying to stop it from happening as a means to facilitate the Community Reinvestment Act.

See also: http://www.newsweek.com/id/164972
Stating that Gramm-Leach-Bliley Act wasn't what caused the meltdown, and noting that "economists on both sides of the political spectrum have suggested that the act has probably made the crisis less severe than it might otherwise have been."

In the exchange with "Joe the plumber" we find out that Obama really is as radical as his early political acquaintances, Davis, Ayers, Wright, etc., and that he is into the failed economic policy of wealth redistribution. Obama's tax and spending plans alone would be bad enough, but add Reid and Pelosi to the mix, with the three of them controlling both houses of Congress and the executive branch without any effective restraint, and you have something that should causes concern even among moderate Democrats.
See Wall Street Journal: A Liberal Supermajority:

http://online.wsj.com/article/SB122420205889842989.html

Their failed policies are what brought us to ruin. Even Bill Clinton says so. Obama and a supermajority of Democrats simply is not the change we need, nor is it change we can afford.

And that???s the punch line for this entire sad affair: every bad assumption and bad faith deal I???ve discussed was rooted in Government regulation and the moral hazards those regulations induced. And every single one of them was correct. All of this set the most dangerous precedent conceivable: next time ??? and there will be a next time, guaranteed ??? every entity involved will demand that the Government bail them out, just like they did in 2008.
Maybe Mr Weisberg needs to study harder. While he may find leveraged hedge funds and credit market derivatives ???unfortunately esoteric,??? they are actually quite simple responses to a ridiculous failure in government regulation that sets liquidity limits for banks and brokerages, but not insurance companies. But therein lies the crux of the matter. Bureaucracies are no match for the intelligent individual. While bureaucracies decry the use of ???loopholes,??? what they fail to point out is that every loophole is a flaw in a bureaucracy???s rulemaking that an individual has already found a way to exploit. The use of loopholes is not against the law even when it is against the spirit of the law. That it takes the average bureaucracy 3 years to close a loophole proves that they are immobile targets in their war against virtually infinitely mobile individuals. It???s no wonder they almost always lose. Or am I just being intellectually immature?

Compare the default rate for conforming mortgages against the default rate for so-called ???jumbo??? mortgages that can often not be sold and are usually held by the issuing bank. As Joseph Hu wrote in Basics of Mortgage Backed Securities, ???since non-conforming loans have a lower delinquency rate, it stands to reason that they have a lower default rate than conforming loans.??? Where sub-prime conforming mortgage default rates have never been below 5% and had previously peaked above 10% (in November 2001 and February 2007), jumbo mortgages requiring documentation continue to show default rates that hover between 2% and 3%. This is despite the fact that jumbo loans have the largest values and their collateralized properties are the most difficult to sell in a bad market. When the most expensive loans have the lowest default rates, this would seem prima facie evidence of a moral hazard in the conforming market.
Critics like Weisberg would most likely comment that this was proof that the banks were cherry picking the best loan opportunities and selling the rest, pocketing the origination fees. To some extent he would be right. Fannie Mae and Freddie Mac helped make this possible when they established acceptance criteria that made it easy for banks to meet the letter of the law without having to worry about the spirit of the law ??? whether or not the borrower was likely to repay the loan. This is the origin of the moral hazard.
Fannie Mae and Freddie Mac further exacerbated the situation when they set rigid criteria for loan approval. In a war of financial mobility, they were sitting ducks. Entire cottage industries were built around getting loans approved. If it didn???t look like your loan would be approved, banks would steer you into the no documentation required loans, in effect winking and saying ???Don???t show us any proof of income ??? we trust you.??? Don???t worry that your prospective home won???t appraise for enough money ??? ???We have appraisers who specialize in this kind of appraisal.??? Wink, wink. No one seemed to care. Should the borrower later default, the loan would be far away from the banks portfolio and, since the business model was based on origination fees rather than interest over the life of the loan, everyone had already been paid. The bond-holder would be reimbursed by Fannie Mae or Freddie Mac.
Except that not everyone got paid. The taxpayers had to keep sinking money into Fannie Mae and Freddie Mac. Despite what Weisberg would probably tell you, Fannie Mae and Freddie Mac were not private businesses ??? they were Government Sponsored Enterprises (GSEs) and widely believed to be ???government guaranteed.??? ???Too Big to Fail??? is no longer an anti-capitalist battle cry ??? it is the new goal of every financial entity in the country.

The Liberals??? Lament
Their socialist view of capitalism makes it difficult for them to accept that financial systems with vigorous government oversight constitute a recipe for disaster.

A source of mild entertainment amid the financial carnage has been watching liberals scurry to explain how the financial crisis is the result of too little government intervention, not too much. One line of argument ignores the Community Reinvestment Act, which prevents banks from "redlining" minority neighborhoods as not creditworthy. Another theory ignores Fannie Mae andFreddie Mac for subsidizing and securitizing mortgages with an implicit government guarantee. An alternate thesis is that past bailouts didn't encourage investors to behave recklessly in anticipation of a taxpayer rescue. But liberal apologists fall wildly short of providing any convincing explanation for what went wrong. Like all true ideologues, they interpret mounting evidence of error as proof that they were right all along.

To which the rest of us can only respond: haven't you people done enough harm already? We may have narrowly avoided a global depression and are mercifully pointed toward merely the worst recession in a long while. This is thanks to an economic meltdown made possible by liberal ideas. I don't have much patience with the notion that trying to scapegoat how we got into this mess is somehow pointless???Al Gore's view of global warming. As with any failure, inquest is central to improvement. And any competent forensic work has to put the liberal theory of government regulated financial markets at the scene of the crime.

The best thing you can say about liberals is that, because their views derive from dogmatic ideology, they tend to be unprincipled and irrational in their logic. Those outside of government at places like the CATO Institute and Reason magazine are more consistent in their opposition to government bailouts and to the kind of regulation that caused one to be seen as necessary. "Let failed banks fail" is the purist line. This approach would deliver a wonderful lesson in how markets correct themselves without government central planning while government bailouts will only end up creating thousands of new jobs in the soup kitchen and food-pantry industry.

The worst thing you can say about liberals is that they are intellectually immature, frozen in the worldview many of them absorbed from Marx. Like other ideologues, liberals react to the world failing to conform to their model by asking how government can spend more and exert more control. Their distorted view of capitalism makes it difficult for them to accept that markets can be rational, deal with risk and allocate resources???or that financial systems with vigorous government oversight constitute a recipe for disaster. They are bankrupt, and this time, there will be another bailout.

Never blame Americans. Always blame someone else. Congress represents PEOPLE. They do what we allow them to do. Unfortunately, people would rather hear about Britney Spears, American Idol and other trivia rather than knowing the intricate facts about economics. Blaming "libertarians" is just as simplistic as any of the arguments you critique. http://dissentingjustice.blogspot.com/2008/10/12-incredibly-lame-news-stories-that.html

What a joke. Regulation is the liberal's answer to everything. Lets regulate sub-prime lending to prevent people from getting loans they can???t afford. Sounds like a good idea. Now lets regulate school curriculum nation wide to better educate children about the dangers of credit and debt. I guess educating students on financial issues wouldn???t be so bad. After Mr. Weisberg gets done telling you what loans you should be allowed to pursue and what you are required to teach your children maybe he would be kind enough to draw up a ???proper??? diet for the rest of us. That way we don???t end up with a country of unhealthy fatties. After that he can tell us what literature would be more in line with the new progressive movement. He might even be willing to give us a run-down on the virtues of a federal eugenics program. Of course to implement a eugenics program we will have to disarm the citizenry, they certainly wont take kindly to being forcibly sterilized. Now that we have a well-regulated police state it shouldn???t be hard to move into the final stage of the fascist overhaul. Just have to round up those last few freethinking stragglers. They will just never understand, will they? We are all extremely lucky to have Mr. Weisberg and his friends looking out for us. Without their willingness to step in take the reins, we might never reach that utopian dictatorship we all dream about. I just saw the ghost of Eugene Debs walk past me.

Maybe we do need some protection from catastrophic financial crisis. Maybe what we don???t need is a bunch of D.C. lawyers and lobbyists deciding what loan an independent U.S. Citizen should be allowed to enter into of their own free will.

Libertarians are not lamenting, we are getting ready to batten down the hatches and ride out the storm ushered in by fascist do-gooders.

A former Newsweek reporter admitted in an article this week that he has no objectivity and imagined disabling Rudy Giuliani so he wouldn't run in the presidential primary race last year.
Michael Hastings wrote in GQ magazine that he had a "recurring fantasy" that he could somehow stop the former New York City mayor in his tracks.
"I quickly realized Rudy was a maniac. I had a recurring fantasy in which I took him out during a press conference (it was nonlethal, just something that put him out of commission for a year or so), saving America from the horror of a President Giuliani. If that sounds like I had some trouble being 'objective,' I did. Objectivity is a fallacy," he said.

http://men.style.com/gq/features/full?id=content_7484&pageNum=2

http://www.rasmussenreports.com/public_content/politics/election_20082/2008_presidential_election/55_say_media_bias_bigger_problem_than_campaign_cash

55% Say Media Bias Bigger Problem Than Campaign Cash

http://www.mediaresearch.org/cyberalerts/2008/cyb20080819.asp

Media Credibility Plummets, Just 30% Believe 'Most Trusted' CNN

Spread the wealth how. Look at his past. Obama in this video, addressing his work with ACORN litigation against the banks and relating to the Community Reinvestment Act and the failure of Freddie Mac and Fannie Mae, as they relate to the current real estate and financial crisis, states that, and I quote:

"Subprime lending started out as a good idea, helping Americans buy homes who previously could not afford to. Financial institutions created new financial instruments that could securitize these loans, slice them into finer and finer risk categories, and spread them out among investors and around the country, as well as around the world. In theory, this should have allowed mortgage lending to be less risky, and more diversified."

"The original idea was a good one, which was, lets see if we can distribute risk more broadly, and make it easier to provide loans to people who otherwise might not be able to get one."

Listen for yourself. You cannot dispute the mans on words recorded live:

http://www.youtube.com/watch?v=Lr1M1T2Y314&feature=related


Obama in this second video is campaigning at a convention of Acorn and I believe two other ???Community Activist's organizations. Ask if he will be their ally if he becomes President, Obama says, quote:

"Yes, but let me say that before I even get inaugurated, during the transition we are going to be calling all of you in to help us shape the agenda."

See and hear it for yourself. Obama promised that Acorn and other groups like it will setting his agenda if elected:

http://www.youtube.com/watch?v=8vJcVgJhNaU
Below is a link to C-SPAN video clips of the Congressional hearings at roughly the time McCains attempt at S.190. to fix Fannie and Freddie. See for yourself who said what.

http://www.youtube.com/watch?v=_MGT_cSi7Rs
See also
http://www.newsweek.com/id/164732 from this web site. (oops!) stating that Freddie Mac was spending tax payer money to target Republicans in 2005 who were trying to regulate Fannie and Freddies fraud. Democrats were not targeted, as the were all in the tank with Fannie and Freddie to kill the regulations. Hear that, the article admits that Republicans were trying to regulate Freddie and Fannie, and Democrats were trying to stop it from happening as a means to facilitate the Community Reinvestment Act.

See also: http://www.newsweek.com/id/164972
Stating that Gramm-Leach-Bliley Act wasn't what caused the meltdown, and noting that "economists on both sides of the political spectrum have suggested that the act has probably made the crisis less severe than it might otherwise have been."

Also worth checking out as a more detailed rebuttal to Weisberg's ridiculous allegations is this piece from George Reisman of the Ludwig von Mises Institute -- http://mises.org/story/3165 . Reisman's article is not written specifically in response to Weisberg's, but rather in response to the whole current media trend of creating a new myth that "our present financial crisis is the result of economic freedom and laissez-faire capitalism." A short excerpt:

"Government spending in the United States currently equals more than forty percent of national income, i.e., the sum of all wages and salaries and profits and interest earned in the country. This is without counting any of the massive off-budget spending such as that on account of the government enterprises Fannie Mae and Freddie Mac. Nor does it count any of the recent spending on assorted "bailouts." What this means is that substantially more than forty dollars of every one hundred dollars of output are appropriated by the government against the will of the individual citizens who produce that output. The money and the goods involved are turned over to the government only because the individual citizens wish to stay out of jail. Their freedom to dispose of their own incomes and output is thus violated on a colossal scale. In contrast, under laissez-faire capitalism, government spending would be on such a modest scale that a mere revenue tariff might be sufficient to support it. The corporate and individual income taxes, inheritance and capital gains taxes, and social security and Medicare taxes would not exist."

Matt Welch of Reason Magazine explains here -- http://www.reason.com/blog/show/129561.html -- why Weisberg simply doesn't know what he's talking about. A short excerpt:

"Weisberg, despite his world-weary, just-the-facts shtick ('as with any failure, inquest is central to improvement'), has a political need to pin the whole blame for the would-be Great Depression 2.0 on 'libertarian ideas.' And nothing says 'unlibertarian ideas' more than Washington bailouts and the mother of all subprime lenders.

"Other subjects absent from Weisberg's self-described 'forensic work': The Sarbanes-Oxley Act (which, you know, regulated financial markets, and had some impact on current events), and the thesis-harshing fact that the Bush administration has increased regulatory spending by more than 60 percent in real terms."

The reality is that big government got us into this mess, and now the politicians and their apologists are desperately looking for scapegoats.

Jacob Weisberg's The Libertarian Lament reminds me that "insanity is doing the same thing over and over and expecting different results." Mr. Weisberg and other apologists for The Nanny State, continue to call our sorry excuse for an economy "capitalism," and continue to call for more and more misguided regulations, which, of course would not exist under capitalism. Not obvious? I do not understand why.

Obama in this video, addressing his work with ACORN litigation relating to the community reinvestment act and the failure of Freddie Mac and Fannie Mae, as they relate to the current real estate and financial crisis, states that, and I quote:

"Subprime lending started out as a good idea, helping Americans buy homes who previously could not afford to. Financial institutions created new financial instruments that could securitize these loans, slice them into finer and finer risk categories, and spread them out among investors and around the country, as well as around the world. In theory, this should have allowed mortgage lending to be less risky, and more diversified."

He further states:

???"The original idea was a good one, which was, lets see if we can distribute risk more broadly, and make it easier to provide loans to people who otherwise might not be able to get one."

Listen for yourself. You cannot dispute the mans on words recorded live:

http://www.youtube.com/watch?v=Lr1M1T2Y314&feature=related

Obama in this second video is campaigning at a convention of Acorn and I believe two other "Community Activist" organizations. Ask if he will be their ally if he becomes President, Obama says, quote:

???Yes, but let me say that before I even get inaugurated, during the transition we are going to be calling all of you in to help us shape the agenda. We???re going to be having meetings all across the country with community organizations so that you have input into the agenda for the next presidency of the United States of America.

See and hear it for yourself. Obama promised that Acorn and other groups like it will setting his agenda if elected:

http://www.youtube.com/watch?v=8vJcVgJhNaU
See also: http://www.newsweek.com/id/164972
Stating that Gramm-Leach-Bliley Act wasn't what caused the meltdown, and noting that "economists on both sides of the political spectrum have suggested that the act has probably made the crisis less severe than it might otherwise have been."
See also:
http://boards.msn.com/MSNBCboards/thread.aspx?threadid=808692&boardsparam=Page%3d2

Below is a link to C-SPAN video clips of the Congressional hearings at roughly the time McCains attempt at S.190. to fix Fannie and Freddie. See for yourself who said what.

http://www.youtube.com/watch?v=_MGT_cSi7Rs
See also
http://www.newsweek.com/id/164732 from this web site. (oops!) stating that Freddie Mac was spending tax payer money to target Republicans in 2005 who were trying to regulate Fannie and Freddies fraud. Democrats were not targeted, as the were all in the tank with Fannie and Freddie to kill the regulations. Hear that, the article admits that Republicans were trying to regulate Freddie and Fannie, and Democrats were trying to stop it from happening as a means to facilitate the Community Reinvestment Act.

Three surveys -- from the Associated Press-GfK, George Washington University and an Investors Business Daily/TIPP poll - - show McCain closing the gap with Obama.

The AP poll puts Obama at 44 percent to McCain's 43 percent, compared with a 7 percentage point advantage for Obama in their September survey. The GW Battleground poll showed Obama's edge at 2 points, down from 7 points in the middle of October, while the IDB/TIPP tracking survey has the margin for the Democrat narrowing to 1 point from 5 points at the start of the week.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aWRlkNLTILM8&refer=home


http://www.msnbc.msn.com/id/27324419/

AP poll: Candidates running nearly even 10/22/08

Neck-and-neck results are a departure from many recent national polls
WASHINGTON - The presidential race tightened after the final debate, with John McCain gaining among whites and people earning less than $50,000, according to an Associated Press-GfK poll that shows McCain and Barack Obama essentially running even among likely voters in the election homestretch.

The poll, which found Obama at 44 percent and McCain at 43 percent, supports what some Republicans and Democrats privately have said in recent days: that the race narrowed after the third debate as Republican-leaning voters drifted home to their party.

Using the word libertarian in a sentence on a single occasion, does not make Alan Greenspan a Libertarian. Alan Greenspan has never condemned the unconstitutional, 35 year-old Zero Tolerance War On Drugs, the unconstitutional Zero Tolerance Global War On Terror, or the ongoing Undeclared War On Individualism.

The fallout in the wake of the subprime mortgage flim-flam was not caused by too much or too little Government oversight. It was caused by criminal, capitalist co-conspirators who accepted regulators' tacit invitation to abuse the relatively free system of commerce they claim to revere, thus inviting increased scrutiny and regulation. As a life-long American Entrepreneur, social liberal and economic conservative, I condemn them.

The Ivy Leagues Best and Brightest on Wall Street use our 401(k) to fund no-money-down, stated-income mortgage loans to individuals who are not creditworthy. What do we do? We print hundreds of billions of dollars, write ourselves an I.O.U, dole it out among the perpetrators and call it equity. Clearly, there is nothing our Government can do that would cause a majority of Americans to affirmatively reject the known Democrat and Republican Brands. China sells us toys with lead paint. We sell them fraudulent securities. Everyone's a winner!

On a good day, the 30 year-old failed experiment that is the Libertarian Party has 25,000 dues paying members. As long as the Average American thinks Lehman Brothers makes really great cough drops, the politicians in Washington and Mr. Weisberg certainly have nothing to fear from Libertarians, to say nothing of the American people.

Using the word ???libertarian??? in a sentence on a single occasion, does not make Alan Greenspan a Libertarian. Alan Greenspan has never condemned the unconstitutional, 35 year-old Zero Tolerance War On Drugs, the unconstitutional Zero Tolerance Global War On Terror, or the ongoing Undeclared War On Individualism.

The fallout in the wake of the subprime mortgage flim-flam was not caused by too much or too little Government oversight. It was caused by criminal, capitalist co-conspirators who accepted regulators' tacit invitation to abuse the relatively free system of commerce they claim to revere, thus inviting increased scrutiny and regulation. As a life-long American Entrepreneur, social liberal and economic conservative, I condemn them.

The Ivy League???s Best and Brightest on Wall Street use our 401(k) to fund no-money-down, stated-income mortgage loans to individuals who are not creditworthy. What do we do? We print hundreds of billions of dollars, write ourselves an I.O.U, dole it out among the perpetrators and call it equity. Clearly, there is nothing our Government can do that would cause a majority of Americans to affirmatively reject the known Democrat and Republican Brands. China sells us toys with lead paint. We sell them fraudulent securities. Everyone???s a winner!

On a good day, the 30 year-old failed experiment that is the Libertarian Party has 25,000 dues paying members. As long as the Average American thinks Lehman Brothers makes really great cough drops, the politicians in Washington and Mr. Weisberg certainly have nothing to fear from Libertarians, to say nothing of the American people.

Yeah, wow. I can't even stop laughing long enough to criticize this junk.

Perhaps the most wrong-headed rant I've ever read. Would banks, BEFORE the disaster of govenment intervention, have made loans with payment far less than certain? Irrationality was introduced by the first government intervention, so why accuse Libertarians of being against regulation to regulate the first regulation. Before Weisberg the party hack dismisses Rand, read her prediction of the Soviet Union's future.......and when she made it. But I sadly have to agree, we are all socialists now. They have won. And Atlas has shrugged.

FactCheck.Org is owned by the Annenberg group of Chicago! Talk about a conflict of interest! And Obama has been telling people on the trail to check out the site to verify his opponents claims. Funny, every time that he endorsed something, it turns out to be a part of his spin machine! Like he raised objections in the primaries when Indiana required photo I.D. to vote. He Protested that It took away people's right to vote! I
knew then and there that he was up to no good! America, wake up from the MASS HYPNOSIS!
http://www.youtube.com/watch?v=pWTs1YyhFRg&feature=related