When Harry Reid and Barney Frank are spitting mad displaying partisan acrimony by flipping their tops in public interviews blaming our financial debacle on Republicans, and feigning indignation because John McCain came to town, you know those House Republicans must have done something right by giving the Paulson plan a big emphatic NO.
That Democrats supported the plan should have raised an eyebrow, and true to their stripes, the plan included one particular disgusting earmark that would have given (and still may) twenty percent of any realized profits to the Housing Trust Fund instead of back to taxpayers.
Chris Dodd, the largest recipient of campaign contributions from beleaguered Fannie Mae and Freddie Mac (second is Barack Obama), added this little jewel to the bailout plan:
TRANSFER OF A PERCENTAGE OF PROFITS:
1. DEPOSITS. Not less than 20 percent of any profit realized on the sale of each troubled asset purchased under this Act shall be deposited as provided in paragraph (2).
2. USE OF DEPOSITS. Of the amount referred to in paragraph (1)
1. 65 percent shall be deposited into the Housing Trust Fund established under section 1338 of the Federal Housing Enterprises Regulatory Reform Act of 1992 (12 U.S.C. 4568); and
2. 35 percent shall be deposited into the Capital Magnet Fund established under section 1339 of that Act (12 U.S.C. 4569).
REMAINDER DEPOSITED IN THE TREASURY. All amounts remaining after payments under paragraph (1) shall be paid into the General Fund of the Treasury for reduction of the public debt.
The prospect of any profits coming back from this bad paper is dubious at best, however, it depends how we interpret the law.
Focus on that magic word each. Adding each to the stipulation means the government could still lose billions in the aggregate of which taxpayers would be responsible, all the while still giving money to the Housing Trust Fund by examining the individual transactions, cherry picking the ones that actually make money and reserving those for Dodd’s politically friendly associates.
What this measure really does is give the United States Government and the taxpayers, the garbage, while keeping the few valuable assets there are and investing those profits into the areas that got us into this mess to begin with.
This is fiscal malfeasance at its worst, and the brazenness with which it is attempted is breathtaking. Republicans can get blame for this financial mess for being stupid while Democrats are flat out criminal.
What is the Housing Trust Fund anyway?
It is a federal body which diverts money to organizations supporting Democrat causes while proclaiming to develop affordable housing for low and middle income people. ACORN, the group where Barack Obama began his political career, has been a large beneficiary of theses funds and its members have been prosecuted and found guilty of voter fraud.
The Housing Trust Fund is a bureaucratic liberal political action group that up until their failure was supported by Fannie Mae and Freddy Mac. A percentage of all profits from these institutions went to the Housing Trust Fund. One more example of how the liberal establishment uses its power in bureaucracy to promote its own interests.
And what about those Fannie Mae and Freddy Mac political contributions?
While Barack Obama tells voters John McCain is George Bush who didn’t do anything to regulate the corruption and bad loan policies at Fannie and Freddy, those organizations were making their greatest political contributions to Chris Dodd, Barack Obama, and John Kerry, all democrats, to make sure no regulation of those organizations occurred.
While Republicans ridicule the whole incestuous and corrupt relationship, Democrats accuse them of playing politics.
Franklin Raines, former CEO of Fannie Mae, overstated earnings by nearly 3 billion dollars to maximize his own bonus rewards. He is friend and advisor to Barack Obama. Raines was sued civilly and agreed to settle out of court for a few million dollars. A paltry amount, considering he made nearly 100 million during his tenure at Fannie.
Ostensibly, we have the greatest financial minds in America trying to figure out how to fix our banking fiasco. We would get further along with one kid out of high school possessing common sense answering simple questions.
Should we give loans to people who can’t pay them back?
Should we imprison executives who falsify financial statements to line their own pockets while sticking taxpayers with losses?
Should we enable corrupt politicians authority to favor Wall Street executives who give generous contributions to their political campaigns?
Should a 700 billion dollar taxpayer bail out include provisions which siphon off funds which ought to go to pay down our debt, and instead give that money to community organizers who endeavor to rig elections with fraudulent voter registration drives?
Should we embrace the central planning sort of system that sunk the Soviet Union while they embrace the free-market principles which conquered them?
Should we vote for the candidate who wants to control spending and eliminate earmarks, or the candidate who wants to spend more?
Copyright 2008 Jim Pontillo