McCain goes on offense, links Obama to credit crisis

posted at 1:20 pm on September 18, 2008 by Ed Morrissey

John McCain shifted gears in Iowa today and reminded voters in Cedar Rapids that he predicted the outcome of the credit crisis two years ago, and few bothered to act.  McCain also aggressively painted Barack Obama as a prime example of do-nothing politicians co-opted by lobbyist money.  His speech pointed out the amount of money Obama has received from Fannie/Freddie donors and the advisers he uses that helped create the crisis (emphases mine):

Senator Obama talks a tough game on the financial markets but the facts tell a different story.  He took more money from Fannie and Freddie than any Senator but the Democratic chairman of the committee that regulates them.  He put Fannie Mae’s CEO who helped create this disaster in charge of finding his Vice President. Fannie’s former General Counsel is a senior advisor to his campaign.  Whose side do you think he is on? When I pushed legislation to reform Fannie Mae and Freddie Mac, Senator Obama was silent.  He didn’t lift a hand to avert this crisis.  While the leaders of Fannie and Freddie were lining the pockets of his campaign, they were sowing the seeds of the financial crisis we see today and enriching themselves with millions of dollars in payments.  That’s not change, that’s what’s broken in Washington.

He also goes after the Brave Sir Robin Congress:

Those same Congressional leaders who give Senator Obama his marching orders are now saying that this mess isn’t their fault and they aren’t going to take any action on this crisis until after the election.  Senator Obama’s own advisers are saying that crisis will benefit him politically.  My friends, that is the kind of me-first, country-second politics that are broken in Washington.

And he rips Joe Biden and his comment this morning about taxes being “patriotic”:

Today Senator Obama’s running mate said that raising taxes is patriotic.  Raising taxes in a tough economy isn’t patriotic.  It’s not a badge of honor. It’s just dumb policy.

This shows a rapid response capability that could turn this into a solid campaign theme for McCain.  Today is Thursday.  If Team McCain hammers on Biden’s inept comment, especially as a way to show that Obama/Biden would raise taxes as a matter of first recourse in any situation, then he could own the weekend news cycle with both that and Obama’s inaction to, and coziness with, the Fannie/Freddie people who in large part created the problem in the first place.

Full speech follows

I’m happy to be introduced by Governor Palin, but I can’t wait until I introduce her to Washington. Let me offer an advance warning to the big spending, greedy, do nothing, me first, country second crowd in Washington and on Wall Street: change is coming.

We need reform in Washington and on Wall Street. The financial markets are in crisis. Times are tough. Enormous strain is being put on working families and individuals in America. I know that the events unfolding can be difficult to understand for many Americans. The dominos that we have seen fall this week began with the corruption and manipulation of our home loan system. The reason this crisis started was the abuses that took place within our home loan agencies, Fannie Mae and Freddie Mac and within our home loan system.

Two years ago I warned this Administration and Congress that regulations for our home loan agencies, Fannie Mae and Freddie Mac, needed to be fixed…

But nothing was done.

Senator Obama talks a tough game on the financial markets but the facts tell a different story. He took more money from Fannie and Freddie than any Senator but the Democratic chairman of the committee that regulates them. He put Fannie Mae’s CEO who helped create this disaster in charge of finding his Vice President. Fannie’s former General Counsel is a senior advisor to his campaign. Whose side do you think he is on? When I pushed legislation to reform Fannie Mae and Freddie Mac, Senator Obama was silent. He didn’t lift a hand to avert this crisis. While the leaders of Fannie and Freddie were lining the pockets of his campaign, they were sowing the seeds of the financial crisis we see today and enriching themselves with millions of dollars in payments. That’s not change, that’s what’s broken in Washington.

There was no transparency into the books of Wall Street banks. Banks and brokers took on huge amounts of debt and they hid the riskiest investments. Mismanagement and greed became the operating standard while regulators were asleep at the switch.

The primary regulator of Wall Street, the Securities and Exchange Commission (SEC) kept in place trading rules that let speculators and hedge funds turn our markets into a casino. They allowed naked short selling — which simply means that you can sell stock without ever owning it. They eliminated last year the uptick rule that has protected investors for 70 years. Speculators pounded the shares of even good companies into the ground.

The Chairman of the SEC serves at the appointment of the President and has betrayed the public’s trust. If I were President today, I would fire him.

We cannot wait any longer for more failures in our financial system. Structures like the resolution trust corporation that dealt with the failed savings and loan industry were designed to clean up the system and worked. Today we need a plan that doesn’t wait until the system fails. I am calling for the creation of the mortgage and financial institutions trust – the MFI. The priorities of this trust will be to work with the private sector and regulators to identify institutions that are weak and take remedies to strengthen them before they become insolvent. For troubled institutions this will provide an orderly process through which to identify bad loans and eventually sell them.

This will get the treasury and other financial regulatory authorities in a proactive position instead of reacting in a crisis mode to one situation after the other. The MFI will enhance investor and market confidence, benefit sound financial institutions, assist troubled institutions and protect our financial system, while minimizing taxpayer exposure. Tomorrow I will be talking in greater detail about the crisis facing our markets and what I will do as President to fix this crisis and get our economy moving again.

Senator Obama has never made the kind tough reform we need today. His idea of reform is what his party leaders in Congress order him to do. We tried for bipartisan ethics reform and he walked away from it because his bosses didn’t want real change. I know how to make the change that Senator Obama and this Congress is afraid of. I’ve fought both parties to shake up up Washington and I’m going to do it as President.

Those same Congressional leaders who give Senator Obama his marching orders are now saying that this mess isn’t their fault and they aren’t going to take any action on this crisis until after the election. Senator Obama’s own advisers are saying that crisis will benefit him politically. My friends, that is the kind of me-first, country-second politics that are broken in Washington. My opponent sees an economic crisis as a political opportunity instead of a time to lead. Senator Obama isn’t change, he’s part of the problem with Washington.

When AIG was bailed out, I didn’t like it, but I understood it needed to be done to protect hard working Americans with insurance policies and annuities. Senator Obama didn’t take a position. On the biggest issue of the day, he didn’t know what to think. He may not realize it, but you don’t get to vote present as President of the United States.

While Senator Obama and Congressional leaders don’t know what to think about the current crisis, we know what their plans are for the economy. Today Senator Obama’s running mate said that raising taxes is patriotic. Raising taxes in a tough economy isn’t patriotic. It’s not a badge of honor. It’s just dumb policy. The billions in tax increases that Senator Obama is proposing would kill even more jobs during tough economic times. I’m not going to let that happen.

I have seen tough times before. I know how to shake-up Wall Street and Washington. I will get this economy moving. I will lead us through this crisis by fighting for you, and when I am President we will be stronger than ever before.


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Janos Hunyadi on September 18, 2008 at 5:12 PM

Hallo again Janos…

Hey; I trek more than 5.5 kilometers a day, up hill and down dale.

The elevation change is more than 250 vertical meters…

Are you keeping your aerobic capacity copasetic, Janos…?

I’m an olde hill and gulley rider…?

You…?

J_Gocht on September 18, 2008 at 5:46 PM

Sarah Palin was born in February, Abe Lincoln was born in Feb;
I think Reagan was born in that month too. Hmmmm….there might be a pattern here.

Christine on September 18, 2008 at 5:47 PM

I almost jumped up out of my seat and cheered as I read this post. It’s about time McCain pointed out what everyone else has been pointing out since the bail-out happened. He needs to make that a bigger point and stop Obama from shifting the financial blame over to the Republican side.

sockpuppetpolitic on September 18, 2008 at 5:48 PM

Well the bad news is Obama has now mocked McCain and said why stop at Cox let’s fire the whole Republican administration. Including McCain. McCain has got to tie Obama to this debacle hard and fast or he is going to lose this thing. Obama is getting mean and scared people like mean.

petunia on September 18, 2008 at 5:57 PM

This must pounded and pounded into the heads of msm. Maybe some one will report it.

oakpack on September 18, 2008 at 6:01 PM

We shouldn’t be too critical about that, however; McSame after all, was holding forth at a German restaurant in Ohio with 27 reporters, while Obama was addressing a quarter million Germans overseas.

I’d be damn pissed too…!

J_Gocht on September 18, 2008 at 4:14 PM

You really must be a foreigner. I related to McCain at a German resturant because that’s where I eat my brats with sour kraut.

And 200,000 screaming Germans do not impress Americans. Sort of like the spiders from that other thread on Hot Air today. We understand the insult and threat of electing the guy the Germans like.

petunia on September 18, 2008 at 6:11 PM

Levin is excoriating McCain for demanding Cox should be fired and brings up some good points.

Why slam the SEC head when it was Frank, Dodd, et al who blocked reform legislation? Cox is limited in his power by the law, which is passed by Congress; he doesn’t control companies. McCain isn’t calling for Congress and lobby ties to be investigated.

McCain is just trying to look like a big man by singling out Cox.

linlithgow on September 18, 2008 at 6:18 PM

FeralCat on September 18, 2008 at 5:41 PM

I’ve pretty much dedicated the latter years of my humble existence to making folks happier than they’ve been sad.

Wildcat, if I can make you smile, that makes my day!

Ferinstance, if I go shopping and tell the cute checker she’s the prettiest thing I’ve seen all day…that’s real fun!

Mind you… only an olde geezer like my own self can get away with a good karma compliment like that; unless you’re really committed…!

Understood..?

Keep ‘er between the ditches, wildcat…!

J_Gocht on September 18, 2008 at 6:18 PM

I’ve pretty much dedicated the latter years of my humble existence to making folks happier than they’ve been sad. – J_Gocht on September 18, 2008 at 6:18 PM

Then why are you still here?

ManlyRash on September 18, 2008 at 6:53 PM

Tap tap tap. Is this thing on?

I vote for Sarah to get John alone and look him in the eyes from about one foot away and tell him:

I’ll play along and be the good little woman. But you have to do the following: (1) Stop slamming Bush; (2) say you’ve changed your mind on ANWR since it’s an emergency; (3) call BHO what he is – socialist and friend of corrupt democrats; (4) blame the country’s economic woes on democrat leaders; and (5) say that the fence comes first before reform.

If you refuse, I want you to look at Hillary’s political position and ask yourself what will happen if I quit and go back to Alaska.

You’ll lose and Obambi will screw up so bad that Hillary will be the dem nominee by acclamation in 2012. Heck, they might even impeach him if he messes up bad enough.

Guess who the Repubs will acclaim in 2012 in response to Clinton.

That’s right – moi.

Now if Sarah would do that, I can guarantee that McCain will obey (he’s had a lot of practice obeying Cindy) and we won’t have to experience four years of Obamanation before we can have Reagan’s successor in the White House.

Now let’s watch the trolls and the defenders go at it. :)

platypus on September 18, 2008 at 7:08 PM

McCain is just trying to look like a big man by singling out Cox.
linlithgow on September 18, 2008 at 6:18 PM

Where’ve I been..?

I thought Mc Same was a big proponent of an RTC bailout like he sponsored in 1990…?

J_Gocht on September 18, 2008 at 7:15 PM

Kind of on topic is that I just saw The Donald publicly endorse McCain on television. Does anyone have an opinion on this?

sonnyspats1 on September 18, 2008 at 7:21 PM

Kind of on topic is that I just saw The Donald publicly endorse McCain on television. Does anyone have an opinion on this?

sonnyspats1 on September 18, 2008 at 7:21 PM

I wouldn’t let him anywhere near Cindy if I were John.

platypus on September 18, 2008 at 7:24 PM

ManlyRash on September 18, 2008 at 6:53 PM

Manly my man, you’re exceptional…!

I’m gonna hang out as an “out of body experience” [OBE] in your life, long after my mortal body has assumed “room temperature”…!

I’m gonna be sittin’ on your shoulder every time you post a “wingnut” dispensation on Hot Aire…!

That little voice of consciousness whispering in your ear…
“reality Manly”…”reality”…

Count on it…!

J_Gocht on September 18, 2008 at 7:27 PM

Ed, I know you and McCain want to try to blame this all on Fannie Mae and Freddy Mac but the truth is different (although they deserve part of the blame).

What killed Merrill Lynch, Lehman Brothers and AIG were credit swaps, credit guarantees and collateralized debt obligations. Yes, they were generally tied to residential and commercial real estate and yes, the housing bubble and resulting pop were to some degree caused by the FM’s, but no one forced the investment banks and AIG to go out and sell those products on a 20:1+ leveraged basis.

No one from outside those companies had the ability to monitor or otherwise oversee the risk they had taken on or to monitor the amount of cushion the firms had in case things went south. And when Hank Paulson proposed a plan last spring to try to get a handle around those things, Bush didn’t want to hear it.

P.S. About 95% of Obama’s political contributions apparently came from individual employees at the FMs, rather than the FM’s Political Action Committee. I don’t think Ford Motors, for instance, is responsible for the contributions made by their employees, so I’m not sure why the Fannies should be responsible for the political contributions made by their employees.

jim m on September 18, 2008 at 7:59 PM

Juan needs to do more of this. It’s tora tora tora from now till November. He’s an old combat pilot so he should have no trouble with the mission.

Tango!

Mojave Mark on September 18, 2008 at 8:00 PM

ManlyRash on September 18, 2008 at 6:53 PM

I’m gonna hang out as an “out of body experience” [OBE] in your life, long after my mortal body has assumed “room temperature”…!

Count on it…!

J_Gocht on September 18, 2008 at 7:27 PM

He may come from hell
Or maybe just from somewhere around the dell

But he will be here and he will be there
You could see him most anywhere

He meddles with your Circle Revolution
Popping in and out throughout each week
Spoiling every mob elocution
Ah, what cheek!

Tav on September 18, 2008 at 8:14 PM

McCain needs to drive this point home hard. He needs ads as well as speeches.

Hawthorne on September 18, 2008 at 8:41 PM

jim m on September 18, 2008 at 7:59 PM

+1

While I’m no fan of George Soros I respect his understanding of markets. I’ve just started his new book and find it to be interesting and timely.

The New Paradigm For Financial Markets:
The Credit Crisis of 2008 and What It Means
George Soros

His description of the exotic instruments, the role of the Fed and use of leverage strikes me as being spot on as it relates to the underlying and systemic problems we are facing.

moxie_neanderthal on September 18, 2008 at 8:48 PM

Ah, what cheek! Tav on September 18, 2008 at 8:14 PM

So clever by so much less than half, my belief…!

J_Gocht on September 18, 2008 at 9:47 PM

We understand the insult and threat of electing the guy the Germans like.

petunia on September 18, 2008 at 6:11 PM

petunia FTW — J_Gocht: pwned

Harpazo on September 18, 2008 at 11:54 PM

I see a real strong “fox guarding the henhouse” theme developing that could actually help McCain. He needs to take it there, and tag Dodd, Frank and Obama’s advisors as the proverbial “fox”. In so doing he also inoculates himself in the process against the temptation of Obama to try and smear *him* as the “fox”.

Well the bad news is Obama has now mocked McCain and said why stop at Cox let’s fire the whole Republican administration. Including McCain.

Yep, and I suppose that’s always a risk in this type of situation – that your opponent will try to make this kind of argument against your entire party. Luckily for McCain there’s a jujitsu remedy here.

McCain has got to tie Obama to this debacle hard and fast or he is going to lose this thing. Obama is getting mean and scared people like mean.

petunia on September 18, 2008 at 5:57 PM

Especially effective is a redirect of Obama’s righteous indignation right back onto himself: “If you’re so outraged, why didn’t you and your cronies do anything about it *before* now? You all could’ve, and yet you didn’t. Instead, you got in *my* way.”

Perfect. Leads right into the “fox guarding the henhouse” meme: would you send Obama and his Freddie/Fannie advisors to guard Washington? Didn’t think so.

RD on September 19, 2008 at 9:10 AM

Awesome. Oblammo may want to hack into some of McCain’s emails to find some dirt now. Oh wait…he can’t do email?!

Badger40 on September 19, 2008 at 10:07 AM

Why, oh why haven’t we seen a commercial making the same points McCain made in this speech? “I’ve been trying for years to get Congress to act on Fannie and Freddie — while Obama has just been collecting their money, more than all but one other Senator even in his short tenure in office.” Or whatever will fit in a 30-second TV ad and some longer Internet ads. Given the media’s bias, what’s said in a speech isn’t going to reach a wide enough audience.

kawyle on September 19, 2008 at 2:31 PM

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