Senate bailout bill hits the Internet; Update: File added; Update: Not earmarks?

posted at 10:24 am on October 1, 2008 by Ed Morrissey

The Senate will begin debate within minutes on their attempt to revive the bailout bill rejected by the House.  They have released the bill text this morning, and the Senate Conservatives Fund website has it for public perusal.  The new version has no allocations going to the Housing Trust Fund, which the Dodd version originally did, so ACORN will get no money from the bailout.

However, the Senate did add a few winners to this new version:

New Tax earmarks in Bailout bill
- Film and Television Productions (Sec. 502)
- Wooden Arrows designed for use by children (Sec. 503)
- 6 page package of earmarks for litigants in the 1989 Exxon Valdez incident, Alaska (Sec. 504)

Tax earmark “extenders” in the bailout bill.
- Virgin Island and Puerto Rican Rum (Section 308)
- American Samoa (Sec. 309)
- Mine Rescue Teams (Sec. 310)
- Mine Safety Equipment (Sec. 311)
- Domestic Production Activities in Puerto Rico (Sec. 312)
- Indian Tribes (Sec. 314, 315)
- Railroads (Sec. 316)
- Auto Racing Tracks (317)
- District of Columbia  (Sec. 322)
- Wool Research (Sec. 325)

I love the auto racing tracks in particular.  I can see the headlines now: “Global financial markets melt down, NASCAR, Caribbean rum hardest hit”.  As many people have said now, I’d be more inclined to take this crisis seriously if people on the Hill didn’t use it to butter up their favored constituencies.

The Senate will vote at around 7:35 PM tonight on this bill.  I’d expect an easier passage, thanks to provisions to expand FDIC insurance and an added authority to suspend mark-to-market rules that may make some of the rest of this bill unnecessary.  Senate leadership isn’t taking any chances; they’ve added this as an amendment to a bill containing some legislation sought by both liberals and conservatives, making it difficult to oppose from any direction.

Update: My friend Sean from Everything I Know Is Wrong returns to blogging on this issue, and takes issue with Arianna Huffington’s analysis of the crisis.  We need more people pushing back on the notion that a lack of government action caused this collapse; it was a government distortion of lending and investment sectors that caused the problem.  But to the extent that government inaction contributed to it, it’s good to recall exactly who the obstructionists were.

Update II: Apparently the load on the SCF server has created some problems.  I’ve loaded the PDF file here.

Update III: I’m being told from multiple sources that the term “tax earmarks” is incorrect and misleading.  Americans for Tax Reform has sent out a memo explaining the difference (and note that the “Ed” in this does not refer to me but a staffer on the Hill):

The language Ed uses below here is very unhelpful and completely wrong from a fiscal conservative perspective.  There is no such thing as a “tax earmark.”  Earmarks are spending.  There are appropriations earmarks.  There are authorization earmarks.  There are no “tax earmarks.”  To claim that there are puts tax deductions and credits (which is what we’re talking about here) on the same par as bridges to nowhere.  Was the creation of HSAs a “tax earmark?”  How about the home mortgage interest deduction?  One might call for lowering the rates and broadening the base, but we should not fall into the trap of equating tax cuts and spending increases.  That’s how some Senate Republicans got in such massive trouble over health care last year and energy this year vis-à-vis taxes.

This is precisely the same logic that Treasury’s Steve Surrey used in the 1960s to create the “tax expenditure” concept.  This faulty doctrine treats tax exclusions, adjustments, deductions, and credits as if they were the same as a federal appropriation.  They are not.  They might not be ideal tax policy, but they are federal revenue reductions—not budget increases.

I would exempt from my statement the outlay effects of refundable tax credits.  Those are, indeed, spending and could rightly be sullied with the term “earmark.”

I’m sorry to be so firm about this, but it’s this confusion between tax cuts and spending increases that I’ve found is the number one cause of well-meaning offices slipping into Taxpayer Protection Pledge violations.  When I see things communicated that would contribute to this confusion (and I know Ed meant no harm by it), I try to jump all over it.

So these are tax breaks, not earmarked spending.  Perhaps some of them are unwisely added to this bill, but this tax extenders bill passed the Senate with overwhelming support, including the anti-pork Tom Coburn.  It didn’t pass the House initially because of the lack of tax increases to accompany it through Pay-Go.


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Which racetrack? If bailing out Wall Street, spending $700B on overvalued property and guiding us further down the road to socialism brings back Formula One to the Indy Motor Speedway then I’m all for it!

grdred944 on October 1, 2008 at 11:14 AM

BTW, the new bill cuts taxes and raises the FDIC limit to 250K.

phronesis on October 1, 2008 at 11:14 AM

And these people want us to allow a s#itload of money to go to more government control when they come up with ideas like this.

I am dumbfounded. It’s beyond belief. 451 pages!

I have something really awful to say that I will keep to myself.

tru2tx on October 1, 2008 at 11:15 AM

Look, there was a clean bill. It was defeated. Now they will do what they must to get the votes. So be it.

phronesis on October 1, 2008 at 11:01 AM

If a clean bill can’t pass, then we don’t need a bill.
This phoney crisis is nothing more than an excuse for another Washington power grab.

MarkTheGreat on October 1, 2008 at 11:15 AM

McCain needs to hold a presser NOW to rip Congress, and sunlight these earmarks.

hippie_chucker on October 1, 2008 at 11:15 AM

They are like addicts. They can’t stop themselves.

ronsfi on October 1, 2008 at 11:15 AM

This smells like a test to see how McCain reacts to the added pork to the bill.

connertown on October 1, 2008 at 11:15 AM

I just don’t buy the whole ‘emergency’ idea. If I had an emergency, say taking someone bleeding to the hospital, I wouldn’t go to the drive through on the way and pick up a couple burgers. But our masters, oops, my bad, I mean elected officials, expect us to pick up the tab for all the pork they’ve slipped into the crap sandwich. I don’t want the crap sandwich to begin with, and I want it even less with all the additions.

Mulligan on October 1, 2008 at 11:15 AM

Hey, wait a sec… this Bill spends a bunch of money… doesn’t it have to start in the House of Reps?

Romeo13 on October 1, 2008 at 11:17 AM

I’ll bet the Nascar provision includes govt interference – particularly on fuel.

OldEnglish on October 1, 2008 at 11:19 AM

Hey! Wait! Does this mean if I work for a rum producer in Puerto Rico and I ride my bike to work, I get a big pile of money? Or do I have to start having relations with sheep as well?

CC

CapedConservative on October 1, 2008 at 11:20 AM

it’s official. The American people are getting smoke blown up their collective asses.

Pcoop on October 1, 2008 at 11:24 AM

Romeo13 on October 1, 2008 at 11:08 AM

Fiscal conservatism isn’t a suicide pact.

phronesis on October 1, 2008 at 11:24 AM

If they weren’t screwing everything up so badly this government and its wormy politicians would be a knee slapping joke.

rplat on October 1, 2008 at 11:25 AM

Dear Senator_________,
When I read this I couldn’t believe the unserious nature of the senate approach.
New Tax earmarks in Bailout bill
- Film and Television Productions (Sec. 502)
- Wooden Arrows designed for use by children (Sec. 503)
- 6 page package of earmarks for litigants in the 1989 Exxon Valdez incident, Alaska (Sec. 504)
Tax earmark “extenders” in the bailout bill.
- Virgin Island and Puerto Rican Rum (Section 308)
- American Samoa (Sec. 309)
- Mine Rescue Teams (Sec. 310)
- Mine Safety Equipment (Sec. 311)
- Domestic Production Activities in Puerto Rico (Sec. 312)
- Indian Tribes (Sec. 314, 315)
- Railroads (Sec. 316)
- Auto Racing Tracks (317)
- District of Columbia (Sec. 322)
- Wool Research (Sec. 325)

I cannot stress how strongly I am against this action. You were sent to the capitol with our trust.
Vote no.

Tony Soprano on October 1, 2008 at 11:27 AM

Which racetrack? If bailing out Wall Street, spending $700B on overvalued property and guiding us further down the road to socialism brings back Formula One to the Indy Motor Speedway then I’m all for it!

grdred944 on October 1, 2008 at 11:14 AM

I believe that the bulk of the money is to be spent on designing tyres that work, this time. :)

OldEnglish on October 1, 2008 at 11:28 AM

What would be better is if pseudo analysts who in reality have no idea what actually happened didn’t constantly offer their two cents. Allah knows just slightly more about what happened than does Arriana Huffington, and frankly, Michelle Malkin knows just slightly more than two other two. All three combined know just about absolutely nothing.

Neither deregulation nor CRA caused this and it is very irritating to have you pseudo analysts act like you know.

Maybe one of you pseudo analysts should talk to someone that was working in the market while all of this occurred and you all might be slightly more educated. What has happened is that each political ideology has picked their favorite target and they each demonize them. Fannie/Freddie and social engineering on one side, and deregulation on the other side. In reality it was none of those as the main culprit and in reality these played minimal roles in the crisis.

The next time someone blames deregulation ask them about the one hundred documents a borrower signs at closing and ask them how much more regulation we can have.

The next time someone points to CRA, I would point out that most of the foreclosures were in affluent or at least middle class areas. The reality is that boom hit in places like Boca, Vegas, and Phoenix. Those didn’t have booms because of CRA. They had booms because that’s where the heat of the market mostly went to. Fannie and Freddie responded to CRA by creating My Community and Home Possible. Those two loans were completely separate of their main portfolio. Those are two tiny loans that had a blip if that on the overall market. Both sides need to stop using this for partisan gain.

Here is how I saw the development of the crisis.

mike volpe on October 1, 2008 at 11:28 AM

I wonder who is pulling Bush’s strings?

http://www.democracynow.org/2004/11/9/confessions_of_an_economic_hit_man

Dr Evil on October 1, 2008 at 11:30 AM

Romeo13, on the constitutionality question,
here’s a link
, see Q125. It seems to be
constitutional, but controversial.

Mulligan on October 1, 2008 at 11:32 AM

The bailout will not work and will only inspire other bailouts.

Angry Dumbo on October 1, 2008 at 11:32 AM

Excuse me, Senators, but is this a fucking joke????

alwyr on October 1, 2008 at 11:34 AM

mike volpe on October 1, 2008 at 11:28 AM

That was a good description of the causes of this crisis.

phronesis on October 1, 2008 at 11:36 AM

Well, McCain says he’ll be voting for the pork laden senate bailout bill.

He has now lost the moral authority on the issue that is the foundation of his campaign.

Today is the day he effectively loses the election.

This is going to be a very strange four years.

Dorvillian on October 1, 2008 at 11:36 AM

Osama Bin Laden is pissed off because the USA is destroying itself on its own and he WON’T GET ANY CREDIT.

Sapwolf on October 1, 2008 at 11:36 AM

I’ve emailed every single one of my representatives at all levels – and demanded that they reject every attempt to pass any form of bailout.

Let the market claim its dead.

LimeyGeek on October 1, 2008 at 11:38 AM

Mulligan on October 1, 2008 at 11:32 AM

Two points…

This directly affects the AMT tax. This bill directly affects revenue.

Also, spending 700 billion plus all the entitlements… where is the money coming from? Is that in a seperate bill? (I can’t seem to get to the text of the bill, overload).

Romeo13 on October 1, 2008 at 11:39 AM

McCain has lost the election due to him voting for an earmark.

It’s over.

Get ready for Obama and even more intrusive government. He is gonna try to fight free speech as he stumbles during his one and only term because he is so insecure and cannot handle legitimate constructive criticism.

Get out of the USD before inauguration.

And, Israel, you better bomb those nuke facilities now while you can.

Sapwolf on October 1, 2008 at 11:39 AM

They are like addicts. They can’t stop themselves.
ronsfi on October 1, 2008 at 11:15 AM

Funny you should mention that, the Senate bill contains:

Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008

Is everybody happy?

Nichevo on October 1, 2008 at 11:44 AM

The next time someone blames deregulation ask them about the one hundred documents a borrower signs at closing and ask them how much more regulation we can have.

The next time someone points to CRA, I would point out that most of the foreclosures were in affluent or at least middle class areas.

mike volpe on October 1, 2008 at 11:28 AM

They sure were… I live in Cape Coral, Florida. These were the famous sub-prime “liar loans” possible as a DIRECT RESULT of pressure on lenders to reduce their standards. If the standards had remained one of 20% down, GOOD appraisal, and GOOD credit, this would never have happened..

CC

CapedConservative on October 1, 2008 at 11:45 AM

If McCain were truly against “pork” he’d poop-can this entire bailout…..business as usual from both Senator candidates. This is what they know: we (government) are the solution.

Palin/Palin ’08

ex-Democrat on October 1, 2008 at 11:49 AM

Hogwash. If they have time in a moment of “crisis” to throw all this pork into a bill that supposedly is a last ditch effort to save our economy, i say the “crisis” itself smells like 9 day old fish. NO NO NO. Let the chips fall where they may (or where they would if you or I mismanaged a business for years). What we really need is a bailout program for Congress to get rid of all these deadbeats and start over again. Disgusting. What kind of approval rating do they have now, – one trillion?

scalleywag on October 1, 2008 at 11:52 AM

Anyone else find it ironic that we’re getting pork on Rosh Hoshanna (sp?)?

Pcoop on October 1, 2008 at 11:52 AM

Just called my Congressman Jeff Flake 6th District Arizona. He is against using taxpayer $ for the bailout.

That was kinda cool actually. First time caller for me. I highly recommend the experience.

I also emailed John Boehner from his web site.

Mr_Magoo on October 1, 2008 at 11:53 AM

Congress, in the midst of this pseudo-issue, still cannot see its way past padding a bill.

Nice.

madmonkphotog on October 1, 2008 at 11:53 AM

Just called my Congressman Jeff Flake 6th District Arizona. He is against using taxpayer $ for the bailout.

That was kinda cool actually. First time caller for me. I highly recommend the experience.

I also emailed John Boehner from his web site.

Mr_Magoo on October 1, 2008 at 11:53 AM

Vote tonight is in the Senate… not the house.

CC

CapedConservative on October 1, 2008 at 11:54 AM

re: “the crisis”: My wife works for a bank that has conservative, diverse portfolio and has weathered the storm and is now shopping around for an acquisition. This week, their stock has gone up because they are considered stable and will get “flight to quality” deposits and new accounts.

The Chairman said he felt like a kid in a candy shop. He’s not looking to borrow trouble but is looking for the right fit for his bank.

We will get through this…

Mr_Magoo on October 1, 2008 at 11:57 AM

We are turning into europe…..ever met a european?

They are, for the most part, what we’d call dishonest or at the least scammers of the “system.”

In their defense though, that’s what the “system” has forced upon them. To survive in the “system” one learns to scam it.

Elites at the top in Brussels, “working” a day a week….collecting huge salaries and bennies….this is what our own Democrats (Socialists) pine for and strive for…

….the problem for all….

Socialism canNOT stem the tide of Isslam.

The socialist “elites” do not have the motivation to fight isslam. They will throw in with them and not miss a beat, except for the towel wrapped around their heads.

And you ladies out there? bend over

And you gay folks out there? here comes the scimitar

Dhimmis, the lot of you.

ex-Democrat on October 1, 2008 at 11:59 AM

Vote tonight is in the Senate… not the house.

CC

CapedConservative on October 1, 2008 at 11:54 AM

Thanks and oh crap! It still has to go through the House if it gets passed, right? Ok, so I guess I’ve got to get back on the phone.

Mr_Magoo on October 1, 2008 at 12:00 PM

These people have not a clue about life outside washington and if they did they would not care.The only way for us to change anything is to replace all 100% of them and start over!

thmcbb on October 1, 2008 at 12:00 PM

I also emailed John Boehner from his web site.

Has he grown a spine since Monday?

ex-Democrat on October 1, 2008 at 12:01 PM

Which racetrack? If bailing out Wall Street, spending $700B on overvalued property and guiding us further down the road to socialism brings back Formula One to the Indy Motor Speedway then I’m all for it!

grdred944 on October 1, 2008 at 11:14 AM

I’m almost inclined to agree. Almost.

fourstringfuror on October 1, 2008 at 12:01 PM

LimeyGeek on October 1, 2008 at 11:38 AM

____________________

LimieyGeek, any chance you can post what you sent so I can shamelessly copy and send as well?

(My quote, strong etc buttons are not showing, anyone know what I screwed up to make them disappear?)

VikingGoneWild on October 1, 2008 at 12:01 PM

it was a government distortion of lending and investment sectors that caused the problem.

Ed Morrissey

GOVERNMENT CAUSED THE PROBLEM, THAT’S A FACT !!

To date Congress has not repealed the act that caused the crisis, why trust them to fix anything with a huge stack of our money?

Maxx on October 1, 2008 at 12:01 PM

With funding comes regulation.

A NASCAR race, running on hydrogen fuel cells will be exciting, won’t it.

[yawn]

franksalterego on October 1, 2008 at 12:02 PM

PUSH BACK FOLKS!!!!!

This is wrong. Period.

tickleddragon on October 1, 2008 at 12:03 PM

There’s a great story in Newsweek that explains the mess
http://www.newsweek.com/id/161199/page/1

scalleywag on October 1, 2008 at 12:04 PM

Wooden Arrows designed for use by children (Sec. 503)

Real children right? Not just the ones in Congress.

highhopes on October 1, 2008 at 12:05 PM

They are like addicts. They can’t stop themselves.

ronsfi on October 1, 2008 at 11:15 AM

No, they are like criminals robbing a bank and they are still carrying out the sacks of money. There are no police to stop them.

Maxx on October 1, 2008 at 12:05 PM

This smells like a test to see how McCain reacts to the added pork to the bill.

McCain has already publicly endorsed it on Fox News. FAIL.

Fletch54 on October 1, 2008 at 12:06 PM

ugh He has lost the election!

becki51758 on October 1, 2008 at 12:07 PM

Maybe this whole thing is a ploy to rig an election. That’s how much I trust anything Pelosi/Reid say. I wonder how many times we’ll hear “remember folks, this is all a result of “Bush’s failed policies” in the next few days?

scalleywag on October 1, 2008 at 12:09 PM

I just called my two senators, Kyl & McCain. I finally got VM for Kyl at his AZ office, the DC number has been busy! I have to bet they are getting smoked! I got VM for McCain as well.

I asked for some extreme hardcore leadership to eliminate these earmarks and to call out anyone trying to add them in.

LimeyGeek, misspelled! Sorry.

VikingGoneWild on October 1, 2008 at 12:09 PM

Good Lord on High…. WTF does Exxon have to do with this Bailout? And HTW did it get on there? Who put it on there?

Anyone know.. because if it was MY Senator’s.. they are done!

upinak on October 1, 2008 at 12:13 PM

The next time someone points to CRA, I would point out that most of the foreclosures were in affluent or at least middle class areas. The reality is that boom hit in places like Boca, Vegas, and Phoenix. Those didn’t have booms because of CRA.

mike volpe on October 1, 2008 at 11:28 AM

The CRA lending rules were applied to everyone, not just to lower income neighborhoods, because of ‘fairness’ and the opportunity to make more money. The CRA, changes in accounting rules for Fan and Fred, and MTM are at the heart of the mess.

Vashta.Nerada on October 1, 2008 at 12:14 PM

simply unbelievable!!!
Earmarks???? Again?????
And McCain is supporting this?????
Well, thats it for me. Third party, here I come.
Republicans can kiss my donations goodbye!!!
See ya at the Obama coronation. I’m sure Gwen Ifill will be invited. sheesh

gordo on October 1, 2008 at 12:19 PM

McCain votes for this, he loses the election.

Vashta.Nerada on October 1, 2008 at 12:20 PM

Once Again

http://www.fee.org/library/books/notyours.asp

scalleywag on October 1, 2008 at 12:22 PM

upinak on October 1, 2008 at 12:13 PM

They took a bill that passed the Senate a week or so ago, and just spliced it into the bailout…

So the pork from the last bill is still in their.

Problem is that the bill also changes the AMT, which changes Tax policy, which changes REVENUE, and because it did not start in the House, this whole bill is Unconstitutional.

Romeo13 on October 1, 2008 at 12:22 PM

DOA. No reform, no bailout. Blame must be fixed because if Congress cannot agree how we got into this mess, they cannot lead us out of it. The bailout will have to wait until the NEXT Congress. This Congress is toast.

The bailout will not work and will only encourage more bailouts.

Angry Dumbo on October 1, 2008 at 12:23 PM

There’s a great story in Newsweek that explains the mess
http://www.newsweek.com/id/161199/page/1

scalleywag on October 1, 2008 at 12:04 PM

The truth starts to come out… when they get around to naming names of those holding the swaps and are faced with having to cough up the bucks when a given debt fails, we will TRULY know who they are trying to bail out.

Until then, it is just a big lie.

CC

CapedConservative on October 1, 2008 at 12:24 PM

Let me answer a few things. First, again, Fannie and Freddie made special loans to respond to CRA. They didn’t apply to everyone. Furthermore, Fannie and Freddie didn’t get in trouble through CRA. They got in trouble when sub prime began to take a serious chunk of their market share. They responded by lowering their guidelines en masse.

Second, so called liar loans were the creation in response to an overheated real estate market, not in response to any government regulation. Their prevalence in sub prime had nothing to do with anything that Fannie did. Their prevalence had everything to do with the fact that MBS’ were selling like hot cakes.

mike volpe on October 1, 2008 at 12:24 PM

Is it possible McCain hadn’t even read the bill yet? Hopefully he’ll call a presser later to expose it…..

anniekc on October 1, 2008 at 12:28 PM

mike volpe on October 1, 2008 at 12:24 PM

Do I understand you correctly? You are saying that CRA had ZERO to do with lowering credit standards and no pressure was placed on lenders using CRA as the hammer to provide loans to those “less credit worthy”?

CC

CapedConservative on October 1, 2008 at 12:29 PM

I just called my two senators, Kyl & McCain. I finally got VM for Kyl at his AZ office, the DC number has been busy! I have to bet they are getting smoked! I got VM for McCain as well.

I asked for some extreme hardcore leadership to eliminate these earmarks and to call out anyone trying to add them in.

LimeyGeek, misspelled! Sorry.

VikingGoneWild on October 1, 2008 at 12:09 PM

Yes! We need to put down our keyboards and pick up our phones. I submitted Kyl’s and McCain’s online forms but I think I need to call instead.

Mr_Magoo on October 1, 2008 at 12:32 PM

Second, so called liar loans were the creation in response to an overheated real estate market, not in response to any government regulation. Their prevalence in sub prime had nothing to do with anything that Fannie did. Their prevalence had everything to do with the fact that MBS’ were selling like hot cakes.

mike volpe on October 1, 2008 at 12:24 PM

This is truly rich… the “overheated real estate market” was the cause of all that money available… naaa.. I’m sure it wasn’t all that money available that ran up the demand (and prices) of houses… naaa… couldn’t be. Sure sounds like sound economic theory to me. Let me see… Supply-Demand…. Raising Prices Increases Demand… yeah, that’s it.

CC

CapedConservative on October 1, 2008 at 12:32 PM

Man, the Senate is broken.

Y-not on October 1, 2008 at 12:34 PM

Is it possible McCain hadn’t even read the bill yet? Hopefully he’ll call a presser later to expose it…..

anniekc on October 1, 2008 at 12:28 PM

Me think he’s wearing his “reach across the aisle” hat today. Me thinks he sees the bill passing and wants to say he voted to help avoid “the crisis.” He’s gone over to the dark side for today.

That’s the problem with McCain. As Rush says, McCain thinks it’s hard to be bi-partisan, but actually it’s hard to be partisan and stand on your prinicples no mater what the cost.

Mr_Magoo on October 1, 2008 at 12:36 PM

Sapwolf on October 1, 2008 at 11:36 AM

doginblack on October 1, 2008 at 12:36 PM

CapedConservative on October 1, 2008 at 12:32 PM

Yea, and I’m sure the drug pusher gives the first hit out for free because he’s a nice guy. Doesn’t have anything to do with getting the user hooked or anything…

Mr_Magoo on October 1, 2008 at 12:38 PM

Every one needs to see what Flyfisher posted in another thread:

Should we take Karl Denninger seriously?

In his latest video screed he shows a clip of Congressman Brad Sherman last night on Kudlow’s show saying this: Hundreds of billions of dollars are going to bail out FOREIGN INVESTORS. They know it, they demanded it, and the bill has been carefully written to make sure that can happen.

I’ve known for days that foreign banks were included, but is it true this bill is a result of foreign demands? If that’s true, how should we respond? Should we cover the bad investment decisions of foreign investors just because they were investing in US products? Denninger points out that the underlying troubled assets that could be purchased by Paulson do not have to be located in the United States.

Denninger also wrote this: “Note also that Representative Sherman said on Kudlow last night that when this was raised with Secretary Paulson he was told that if Congress tried to restrict the ability of the Secretary to purchase assets “laundered” in this fashion from foreigners, that the bill would be vetoed.”

I believe we have real problems, but I am having trouble knowing exactly whom the taxpayers can trust. Are any of you confident we have been told the real truth? I certainly don’t trust the rats in congress or Hank Paulson. And to me President Bush seems like a deer in the headlights. It appears to me that all of this is beyond him and he is trusting untrustworthy men.

flyfisher on October 1, 2008 at 12:07 PM

If you watch that videoclip it will make your blood boil. I don’t know what’s true and what’s not.

Stayright on October 1, 2008 at 12:38 PM

mike volpe on October 1, 2008 at 12:24 PM

No the liar loans were the direct result of Fannie and Freddie BUYING these loans from the initial lender.

Once the loan was complete, Fannie and Freddie considered due diligence complets… as the origional lender had completed the deal. They’d just buy huge chunks of loans, some good, some bad… and the Originator would walk away with a smaller profit, but no risk.

Romeo13 on October 1, 2008 at 12:38 PM

There’s a link on the main page saying that the calls are turning in favor of this. One sure way to tell the truth is to see which way the 1/3 of the Senate that is up for re-election votes compared to all the rest. If they vote for, that may be true. If they favor against, it will be yet another attempt by the media to shape opinion.

CC

CapedConservative on October 1, 2008 at 12:39 PM

That’s the problem with McCain. As Rush says, McCain thinks it’s hard to be bi-partisan, but actually it’s hard to be partisan and stand on your prinicples no mater what the cost.

Bingo. Once a senator, always a senator. He simply can’t/won’t make the transformation to Presidential stature, even with the overwhelming will of of the people staring him in the face.

Fletch54 on October 1, 2008 at 12:39 PM

Zero is a strong word, however CRA is a blip that is turned into something that it never was. Credit standards were lowered because the market for MBS became so heated that to satisfy the demand for MBS, banks and Wall Street needed to create more and more loans. CRA is nothing more than a red herring used by conservative ideologues to try and make it appear as though this crisis was created becaue of social engineering and government interference.

The fact is that, in my opinion, it was government interference that created this crisis but that government interference had nothing to do with CRA. When Greenspan dropped the Fed Funds Rate below one, he created artificial liquidity that was then flooded into the real estate market and that turned into a speculative market that created these loans.

It’s so silly to blame CRA. It was created in 1977. There was a larger emphasis in 1995. Yet, this crisis started to materialize in 2003. Why did it take so many years for one action to cause a reaction? It didn’t, that’s why.

mike volpe on October 1, 2008 at 12:40 PM

This is also helpful from a historical standpoint.

DrSteve on October 1, 2008 at 12:42 PM

Once a senator, always a senator. He simply can’t/won’t make the transformation to Presidential stature, even with the overwhelming will of of the people staring him in the face.

Fletch54 on October 1, 2008 at 12:39 PM

Follow the logic: Which is why Governors make better Presidents than politicians.

Mr_Magoo on October 1, 2008 at 12:43 PM

Romeo13 on October 1, 2008 at 12:22 PM

Romeo I understand that but the Exxon part wasn’t in any of the bills, so where did it come from? AND, whomever put it in… was it deliberate or was it for lobbying?

Think about it. How much money have Alaska gotten from (still haven’t seen the money though) from Exxon concerning the Spill? Putting this in is going to make people scream that Sarah asked for the Exxon part to be put in.

So I want to know where it came from.

upinak on October 1, 2008 at 12:47 PM

So… errrr…

How come no one is talking about the 500 pt. stock surge yesterday, in stunning contrast to the “sky falling” meme?

And hmmm… talk resumes on the new and more pork laden 300 page barrel of BS and stock go down 22 pts. today.

Who’d of thunk it… the government intervention has been yet again been proven to play a negative role in the market.

Message to Feds: shut up, step aside and stop with all the Armageddon scare tactics. Sit down with people who have a clue, come up with a legitimate plan without pork and implement it without the drama.

According to Congress and the President, we should have had everyone on Wall St. jumping out of windows by Friday of last week and the rest of the world would have begun construction on Thunderdome by Monday evening. Rise and repeat for the doom and gloom messages from the prior week and the week before that.

Guess what? You were all wrong.

I will say it again- UNCERTAINTY is the primary problem and that uncertainty is coming 100% from Washington, not Wall St.

Damiano on October 1, 2008 at 12:48 PM

What was the cause of all that money being available was Greenspan dropping the Fed Funds Rate below one percent? At the time he did this, the only sector that was moving was real estate. As such, banks went all into real estate and with them went all the financial services companies. That caused the real estate market to overheat. Once the real estate market began to overheat Wall Street simply couldn’t get enough of these MBS’ and so they continually began to lower standards including these so called liar loans. They lowered them with reckless abandon and here we are.

Look, there is the truth and there is partisan spin. If you all want to believe what your partisan ideology tells you to believe that is fine, but it won’t make it true. If you want to know the truth cut through the partisan spin and talk to folks that worked in real estate while all this happened and you will hear the truth.

I started in mortgages in early 2002. I have worked in mortgages through the refinancing boom and through the real estate boom. I saw what happened. I saw sub prime banks trying to one up each other with ever more ridiculous loans. Every time I asked a rep why their standards were so aggressive they told me that was what wall street wanted. Wall Street were the folks packaging these loans and selling them as bonds.

I saw sub prime banks tell me to check them out on high loan to value loans if I wanted to take the loan to Fannie/Freddie. I saw this. I also did several loans in 2006 that were low and no money down through fannie/freddie that were split 80-20 or 80-15. This crisis is not that hard to put together once you see it from the inside.]

If it makes you all feel better it isn’t as though the Democrats have any less responsibility. Fannie/Freddie were making irresponsible loans. The Democrats were looking the other way because they thought these were going to low income folks. In fact, its worse. They let Fannie/Freddie act irresponsibly because they thought that irresponsibility was going to low income housing and in fact, they were spreading it throughout the market place.

mike volpe on October 1, 2008 at 12:50 PM

Time to invoke the Krauthammer Policy, except we don’t need to limit it to CEO’s and Wall St fat cats.
What part of no earmarks don’t they get? Don’t they realize what is causing all the outrage on Main St is their willie nillie use of our tax dollars? Or do they just not care? This is bordering on OCD, Obsessive Compulsive Disorder.

Just A Grunt on October 1, 2008 at 12:50 PM

It’s so silly to blame CRA. It was created in 1977. There was a larger emphasis in 1995. Yet, this crisis started to materialize in 2003. Why did it take so many years for one action to cause a reaction? It didn’t, that’s why.

mike volpe on October 1, 2008 at 12:40 PM

Oh and the videos of the hearings of people trying to point out the problems with Fannie/Freddie pumping out these low standard loans, again, using CRA as the hammer to justify pressure for lower standards are all fiction… the revision of history on this is beginning… that plastic grass hurting your feet?

CC

CapedConservative on October 1, 2008 at 12:52 PM

Crisis? What crisis? The strong will survive.

• Wells Fargo still waiting for right deal
• JDA says Wells Fargo unit joins finance group
• Ahead of the Bell: Wells Fargo shares upgraded
• Citigroup to buy Wachovia banking operations

Mr_Magoo on October 1, 2008 at 12:57 PM

I didn’t say that Fannie/Freddie shouldn’t have been overseen or that they didn’t make a lot of bad loans. Worse yet, they bought a whole bunch of risky MBS for no reason but the pursuit of extreme profit. I am not even saying that democrats weren’t looking the other way because they thought that fannie/freddie were making a bunch of bad loans to low income folks. All of that is true, however fannie/freddie’s problems had almost nothing to do with CRA, and the crisis had even less.

mike volpe on October 1, 2008 at 12:57 PM

fannie/freddie’s problems had almost nothing to do with CRA, and the crisis had even less.

mike volpe on October 1, 2008 at 12:57 PM

Hilarious. You just can’t fix stupid.

LimeyGeek on October 1, 2008 at 1:01 PM

Like I said, you can either believe what your partisan ideology wants you to believe or you can try to learn the truth. Most of you had never even heard of CRA until a month ago. You probably hadn’t even heard of Fannie/Freddie until two months ago, and now it appears that you are all experts and more experts than me who was working in the business for the entirety of the crisis.

mike volpe on October 1, 2008 at 1:04 PM

mike volpe on October 1, 2008 at 12:57 PM

Try a more direct linking….

http://www.lewrockwell.com/dilorenzo/dilorenzo125.html

You still didn’t tell me how that plastic grass under you feet feels…

CC

CapedConservative on October 1, 2008 at 1:04 PM

*puts on tin foil hat*

I have never been one for conspiracies, but this entire thing stinks to high heaven, even to a devout skeptic like me. Anyone who looks at the market and the news cycle can see that the entire doomsday scenario is manufactured BS. Couple that will the complete blackout of all Republican responses and the MSM’s insistence in playing up the “it’s the Booosh/ McCain Republican’s fault” angle, in spite of nearly a decades worth of evidence to the contrary, Pelosi’s first-in-history support of a White House plan, adoption it as her own (while a week earlier, all she and Reid could talk about was adjournment by last Friday and Reid was running in circles babbling “no one knows what to do”)and Pelosi’s absolute failure to do anything to ensure the bill’s passage with her caucus while doing everything possible to lay blame and piss of the Republicans…

This is nothing by a manufactured crisis build on long-standing corruption and ignorance. One look at the polls and you see the motivation behind it. If were not for the “sky falling”, McCain would be blowing Obama off the map by now; like the irrelevant, worthless piece of shit that he is.

Damiano on October 1, 2008 at 1:05 PM

I can find a thousand stories on the internet like the one you linked. That doesn’t make them accurate. It’s amazing how quickly anyone will believe anything on some site they had never heard of prior to the first reading as long as it affirms their ideology.

The difference between me and everyone arguing with me is that I don’t need a website to tell me what happened I have nearly seven years of experience in the business that I use as “my source” for what happened.

Now, if this was thirty years of bad policy, why did it all materialize only five years ago? What was different five years ago from the first 25 years? That’s something no one can explain. What was different was the excessive fed action that lowered rates so much that the market was flooded with cash. That’s what.

mike volpe on October 1, 2008 at 1:10 PM

mike volpe on October 1, 2008 at 1:10 PM

I see, so we’re supposed to believe a single poster on a single sight instead?

Interesting arguement.

Romeo13 on October 1, 2008 at 1:17 PM

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