Barack Hussein Obama II is the 44th and current President of the United States.
He is the first African American to hold the office. Born in Honolulu, Hawaii -
August 4, 1961? (No birth records available or issued at time of birth). Obama is a
graduate of Columbia University and Harvard Law School, where he was president
of the Harvard Law Review. He was a community organizer in Chicago before
earning his law degree. He worked as a civil rights attorney in Chicago and taught
constitutional law at the University of Chicago Law School from 1992 to 2004.
He served three terms representing the 13th District in the Illinois Senate from 1997
to 2004, running unsuccessfully for the United States House of Representatives in 2000. Elected President of the US, November, 2008.
By Felicity Blaze Noodleman
This is a rather lengthy article; coming in at over 7,000 words and reprints 8 news articles from the past few years, but I think you can keep up with it. The
Presidential campaign of 2012 is now in full swing with the announcement of
Paul Ryan as Mitt Romney’s VP running mate and there are already
fireworks. The Revelation of the $716
Billion cuts to Medicare budget through Obamacare. It appears the Presidents hand has been in the Medicare cookie jar removing $716 Billion and using it to fund his “Health Care” initiative.
Romney’s
right: Obamacare cuts Medicare by $716 billion. Here’s how.
Posted by Sarah Kliff on August 14, 2012
at 4:54 pm
The
Romney campaign has gone on the offense on Medicare, charging that the
Affordable Care Act “cuts $716 billion” from the entitlement program.
That
$716 billion figure is one you’ll probably be hearing a lot about during this
election cycle. It’s worth understanding where it comes from and what the
spending reductions mean for the Medicare program.
First,
where it comes from. On July 24, the Congressional Budget Office sent a letter to House Speaker John Boehner,
detailing the budget impact of repealing the Affordable Care Act. If Congress
overturned the law, “spending for Medicare would increase by an estimated $716
billion over that 2013–2022 period.”
As to
how the Affordable Care Act actually gets to $716 billion in Medicare savings,
that’s a bit more complicated. John McDonough did the best job explaining it in
his 2011 book, “Inside National Health
Reform.” There, he looked at all the various Medicare cuts Democrats made to pay for the Affordable Care Act.
Reform.” There, he looked at all the various Medicare cuts Democrats made to pay for the Affordable Care Act.
The
majority of the cuts, as you can see in this chart below, come from reductions
in how much Medicare reimburses hospitals and private health insurance
companies.
Republican presidential candidate Mitt Romney writes on a white board as
he talks about Medicare during a news conference at Spartanburg International
Airport Thursday in Greer, S.C.
Evan Vucci/AP
The
blue section represents reductions in how much Medicare reimburses private,
Medicare Advantage plans. That program allows seniors to join a private health
insurance, with the federal government footing the bill. The whole idea of
Medicare Advantage was to drive down the cost of health insurance for the elderly
as private insurance companies competing for seniors’ business.
That’s
not what happened. By 2010, the average Medicare Advantage per-patient cost was
117 percent of regular fee-for-service. The
Affordable Care Act gives those private plans a haircut and tethers
reimbursement levels to the quality of care administered, and patient
satisfaction.
The
Medicare Advantage cut gets the most attention, but it only accounts for about
a third of the Affordable Care Act’s spending reduction. Another big chunk
comes from the hospitals. The health law changed how Medicare calculates what
they get reimbursed for various services, slightly lowering their rates over
time. Hospitals agreed to these cuts because they knew, at the same time, they
would likely see an influx of paying patients with the Affordable Care Act’s
insurance expansion.
The
rest of the Affordable Care Act’s Medicare cuts are a lot smaller. Reductions
to Medicare’s Disproportionate Share Payments — extra funds doled out the
hospitals that see more uninsured patients — account for 5 percent in savings.
Lower payments to home health providers make up another 8.8 percent. About a
dozen cuts of this magnitude make up the green section above.
It’s worth
noting that there’s one area these cuts don’t touch: Medicare benefits. The
Affordable Care Act rolls back payment rates for hospitals and insurers. It
does not, however, change the basket of benefits that patients have access to.
And, as Ezra pointed out earlier today, the Ryan budget would
keep these cuts in place.
The
Washington Post
President Obama has
been making the kind of wild and baseless charges against the Republicans. Charges that
Democrats love to hear and truth doesn’t seem to be an issue with him. If some other Democrat has made the claim in the
past over issues back then the President will use it again. Asking Romney to release his Tax Returns for example. The Problem for the President is that Romney has already done so.
Romney Says He Paid at Least 13% in Income Taxes
By MICHAEL D. SHEAR
Published:
August 16, 2012
WASHINGTON — Mitt Romney said
Thursday that he paid at least 13 percent of his income in taxes each year
during the past decade, again confronting a vexing issue that Democrats have
used to portray him as out of touch with middle-class values.
Calling the
interest in his personal tax returns “small-minded” in light of the nation’s
problems, Mr. Romney said that he had nonetheless examined the last 10 years of
his personal tax returns after Democrats suggested that he might not have paid
anything at all in some years.
“Every year,
I’ve paid at least 13 percent,” he said, referring to his effective federal
income tax rate, which is a higher effective rate than most people pay.
Mr. Romney’s
decision to address the tax question on Thursday appeared to be an off-the-cuff
attempt to put the nettlesome issue behind him once and for all. But at least
initially, it had the opposite effect. Democrats seized on his comments to
revive the issue and to once again demand proof of his claims by releasing
multiple years of his tax returns.
The
re-emergence of the tax issue consumed another day of the campaign and added to
the sense of a shift in direction for a candidate who had once steadfastly
refused to talk about anything other than job losses during Mr. Obama’s tenure,
the unemployment rate and the nation’s growing debt.
Now, after
Mr. Romney’s decision to name Representative Paul D. Ryan of Wisconsin as his
vice-presidential choice, the campaign is instead waging an aggressive battle
on Medicare, welfare and Mr. Obama’s character. That change in focus can
be seen in the campaign’s ads and in Mr. Romney’s speeches. And it stands in
contrast to the approaches of some Republican Congressional candidates, who
said Thursday that they intended to wage their own campaigns strictly on
economic issues.
“We are
staying on our message,” said Chris Collins, the Republican candidate in New
York’s 27th District, near Buffalo. Mr. Collins said that Republicans should
welcome the Medicare debate, but that in his own campaign, “every time anything
comes up, I bring it back to the economy, the economy, Obamacare.”
Richard
Tisei, a Republican running in Massachusetts’ Sixth District, said that for Mr.
Romney and Republicans, “ultimately, the campaign is going to be about the
state of the economy.”
Mr. Romney
made the remarks about his taxes on Thursday at a hastily arranged news
conference at an airport in South Carolina, where he sought to amplify the
Medicare argument he has been making in earnest since selecting Mr. Ryan. To
drive home his point on the difference in the approaches to Medicare by the
Republican ticket and the Obama administration, Mr. Romney drew numbers on a
white board positioned on an easel before television cameras.
It was a
moment that delighted aides back at his campaign headquarters in Boston — until
Mr. Romney answered a reporter’s question about his income taxes. For the rest
of the day, his statement that he has paid at least 13 percent in federal
income taxes over the past decade received more attention than his original
statement on Medicare.
Democrats
have hounded Mr. Romney for months about his tax returns. Senator Harry Reid of
Nevada, the Democratic leader, has asserted — without providing any proof —
that Mr. Romney paid no taxes in some years, presumably by using offshore tax
shelters and other legal accounting measures.
Mr. Romney
had already denounced the remarks as false. But he has steadfastly refused to
release more than his full return for the 2010 tax year and a short summary of
taxes he paid in 2011. In an interview on NBC’s “Rock Center” that was
broadcast Thursday night, Ann Romney stood by her husband’s refusal, saying
that further releases would simply provide “ammunition” for Democrats.
“The more we
get attacked, the more we get questioned, the more we get pushed,” Mrs. Romney
said. “There’s going to be no more tax releases given. Mitt is honest. His
integrity is just golden.”
In an
interview last month, Mr. Romney was asked whether he had ever paid a tax rate
lower than the 13.9 percent he paid in 2010.
“I haven’t
calculated that,” he told David Muir of ABC News. “I’m happy to go back and
look, but my view is I’ve paid all the taxes required by law.”
In saying
that he paid a tax rate of at least 13 percent, Mr. Romney and his wife would
still have had a higher income tax rate than most households. More than 46
percent of households did not pay any federal income tax in 2011 because their
income was low enough that deductions and credits reduced their bill to zero.
Even a typical household making $100,000 a year would pay closer to a 10
percent average federal income tax rate than a 15 percent rate, Congressional Budget office data suggest.
For many
middle-class households, however, other taxes — like payroll taxes and state
and local taxes — typically cause their total annual tax rate to rise to 20
percent of their income and higher. For Mr. Romney, these other taxes most
likely had only a small effect on his total tax rate, because much of his
income came from investments, which is generally taxed at a lower rate than
wage income.
In 2011, Mr.
Obama and his wife reported an effective federal income tax rate of 20.5
percent. In 2010, their rate was just over 26 percent.
In the brief
exchange with reporters in South Carolina, Mr. Romney used a black marker to
sketch out his assertion that the president had cut $716 billion out of the
Medicare program “to fund Obamacare.” But the tax question came a few moments
later, and he eagerly answered it.
“Campaigns don’t
control their own destiny,” said Dave Carney, a Republican strategist who
managed the presidential campaign of Gov. Rick Perry of Texas. “You can talk
about what you want, but you have to be relevant to the ongoing discussion.”
The New York Times
5 scandals that could undo Obama's re-election bid
For the most part, the Obama
administration has successfully avoided bad publicity, but it's now being faced
with a string of scandals at the worst possible time
posted on April 19, 2012, at 1:50 PM
Best Opinion: Atlanta J-C, Wash. Post, Buzzfeed ...The Obama administration has largely been heralded as the most scandal-free in modern history. But now, right in the middle of an election year, President Obama is being saddled with a string of embarrassing — and potentially damaging — incidents. Most recently,The Los Angeles Times released photos of U.S. soldiers posing with the corpses of Afghan insurgents. While the revelation was deeply troubling, that scandal has mostly reflected poorly on the military. Obama hasn't been so lucky, though, with respect to the still-unfolding Secret Service prostitution scandal that blew up in Colombia as the president headed there for the Summit of the Americas on April 14. Will the storm of bad publicity hurt Obama? Here, five scandals that could hurt the president's chances for a second term:
President Obama's reputation for
a clean administration is being
tainted by a string of scandals
involving everything from the State
Department to the Secret Service.
Photo: CC BY: The White House
President Obama's reputation for
a clean administration is being
tainted by a string of scandals
involving everything from the State
Department to the Secret Service.
Photo: CC BY: The White House
1. The Secret Service
prostitution mess...
"One Secret Service scandal in Colombia, by itself, will not undermine
Obama's re-election chances,"
says Kyle Wingfield at The Atlanta
Journal-Constitution.
But if the list of "known scandals grows much broader or deeper or
seedier, at some point some voters may conclude their government isn't being
well-run. And that could only be bad news for an incumbent who promised
competence in government, and who will be opposed by a managerial
businessman-turned-politician in Mitt Romney."
2. ...Combined with the
General Services Administration mess
So what makes the Colombia fiasco potentially harmful is that it comes as
Americans are still digesting another bombshell, says Chris Cillizza at The Washington Post, "the lavish spending of the General Services Administration on a wild Las Vegas retreat." Romney is already "starting to ramp up his rhetoric on the subject," suggesting that he'd be more forceful in keeping his bureaucrats in line. "I'd clean house," the presumptive GOP nominee told conservative radio talk show host Laura Ingraham.
3. Alleged sexual
hijinks at the Baghdad embassy
A "State Department gadfly," foreign service officer Peter Van Buren, dropped another potentially embarrassing "bombshell" this week, says Michael Hastings at Buzzfeed. Van Buren — who's locked in a "protracted legal battle with Foggy Bottom over the publication of his memoir, We Meant Well" — suggested on his personal blog that another potential scandal is in the offing for the administration. "What if a video existed that showed a prominent State Department VIP on the roof of the Republican Palace in Baghdad receiving, um, pleasure of an oral nature from another State Department officer?"
4. The "Fast and
Furious" gun-running fiasco
"Republicans can bring the campaign war to American's television sets," says Thomas Grier at The Daily Caller, by shining a spotlight on the "Fast and Furious" scandal at the Justice Department. The DOJ's Bureau of Alcohol, Tobacco, Firearms and Explosives came under fire in early 2011 for pushing gun shops to sell weapons to "straw" buyers who were funneling guns to Mexican drug gangs. The ATF's goal was to trace the weapons to the upper echelons of Mexico's deadly drug cartels, but the botched sting ended in the murder of a U.S. Border Patrol agent and the shootings of some 200 Mexican civilians. "Of all the myriad scandals of the Obama administration," this one is the worst, and "bloodiest," says David Limbaugh at News Busters.
"Republicans can bring the campaign war to American's television sets," says Thomas Grier at The Daily Caller, by shining a spotlight on the "Fast and Furious" scandal at the Justice Department. The DOJ's Bureau of Alcohol, Tobacco, Firearms and Explosives came under fire in early 2011 for pushing gun shops to sell weapons to "straw" buyers who were funneling guns to Mexican drug gangs. The ATF's goal was to trace the weapons to the upper echelons of Mexico's deadly drug cartels, but the botched sting ended in the murder of a U.S. Border Patrol agent and the shootings of some 200 Mexican civilians. "Of all the myriad scandals of the Obama administration," this one is the worst, and "bloodiest," says David Limbaugh at News Busters.
5. The Solyndra boondoggle Republicans have also "attempted to capitalize on the failure of Solyndra," says Felicity Carus at PV Tech. Congress is still investigating the case, that involved a $535 million Department of Energy loan to the now-defunct solar-panel manufacturer. Although Solyndra filed for bankruptcy last September with little to show for the huge investment, a recent survey suggests that the GOP's "attempt to use the Solyndra story to political advantage has failed to achieve the effect desired." Republicans who accuse Obama of reckless spending are ticked off about Solyndra, but the rest of the American public increasingly sees solar energy, which Obama was pushing with the Solyndra loan, as "a no-brainer."
The "Presidential Approval Tracker" from "USA Today". See how the
President is below the 50% rating for a large part of his first term.
A Brief Look at Candidate Obama's 2008 Campaign Promises
by Jake Gibson | April 05, 2011 - Fox News
With the news that President Obama is officially running for re-election in 2012, we thought it would be interesting to take a look at where some of candidate Barack Obama's 2008 campaign trail promises stand today.
The president has said he keeps a check list of promises he made during the campaign in his pocket. Last fall Mr. Obama told "Rolling Stone" he figured his administration had "probably accomplished 70 percent of the things that we said we were going to do."
The watchdog organization Politifact.com* has been keeping
track and puts candidate Obama's list of promises at a staggering 506, of those
they say the president has kept 122, or 24 percent. Coincidentally, of the 25
selected as the most significant promises, politifact.com says Obama has
followed through on six, for a 'promise-kept percentage' of 24 percent.
Here is a selection we thought worthy of inspection:
1) Guantanamo Bay
As a candidate, Barack Obama repeatedly stated his
intentions to close the Guantanamo Bay detention center, calling the facility a
recruitment tool for al Qaeda. With Monday's announcement by Attorney General
Eric Holder that Khalid Sheikh Mohammed and four other alleged plotters in the
September 11 attacks would be tried in military courts, it has become even more
obvious that Gitmo will not be shutting down anytime soon.
However, some Obama supporters say they don't see Guantanamo
Bay shaping up as a huge problem for the president in 2012.
"President Obama is still trying to shut down Gitmo as
soon as possible, it's just turning out that it's not possible," said
Democratic strategist Joe Trippi. "But I don't see that promise really
hurting him in 2012, his base probably won't abandon him over that."
2) Letting Bush-Era Tax Cuts Expire
As a candidate, Barack Obama said he opposed tax cuts for
the wealthiest Americans and if elected to the highest office in the land, he
would let the Bush-era tax cuts expire. However as president, Obama found that
he had to compromise in order to avoid raising taxes for most Americans. In the
end, the only way for the president to keep the Bush-era tax rates for couples
making less than $250,000 was to also extend current tax rates for what he
called "the wealthiest two percent of Americans."
Once again, Democrats don't see this as a deal breaker.
"He fought against extending the Bush tax cuts the whole
way, he just lost. But once again I don't think his base will desert him for Mitt
Romney or Newt
Gingrich over this," said Trippi.
3) Foreclosure Prevention Fund
During the campaign, candidate Obama said he would create a
$10 billion fund designed to come to the aid of homeowners at risk of
foreclosure. "Too many families are unable to refinance because no one
will lend to them, and they are unable to sell their homes because the housing
market has fallen," said Obama in 2008.
The president actually tried to go above and beyond the
initial promise by creating a fund that totaled $75 billion. This money came,
in part, from the Troubled Asset Relief Program (TARP). The problem is the
program, for a myriad of reasons, has failed to deliver. As of January 2011,
the program had helped only about 500,000 homeowners.
4) Immigration Reform
As a candidate out on the campaign trail, Mr. Obama promised
to provide a path to citizenship for undocumented immigrants. However, during
his first two years in the White House, the president spent just about all of
his hard earned political capital on passing health care reform and the
economic stimulus. So by the time Obama went back to the well for immigration,
he was politically broke.
The DREAM act, a bill aimed to provide a path to citizenship
for immigrants brought to the U.S. as children, passed in the House but died in
the Senate during the lame duck session. With that chance missed, it could be a
long time before Democrats and immigration reform backers have the numbers in
Congress to make another run at it.
Obama called the failure to pass immigration reform
"maybe my biggest disappointment" of the lame duck session but
maintains he is still committed to the goal.
5) Restricting Former Lobbyists from Serving in Obama
Administration
As a candidate, Barack Obama deplored the prevalence of
lobbyists in and around the White House. "No political appointee will be
able to lobby the executive branch after leaving government service during the
remainder of the administration," said Obama in 2008.
However, according to politifact.com, the administration has
granted waivers to several former lobbyists, allowing them to serve. The
administration also allows "recusals," in which a former lobbyists
can recuse themselves from discussions surrounding interests they used to
lobby.
6) Iraq War
As a candidate out on the trail, Mr. Obama made the Iraq war
one of his main issues and hammered his Republican rival Sen. John McCain over
and over on the subject. Obama said he would work with military commanders on
the ground in Iraq and in consultation with the Iraqi government to end the war
safely and responsibly within 16 months.
Here is one that is widely considered to be a promise kept
for President Obama. Although about 48,000 U.S. troops remain in Iraq as a
transitional force, the bulk of the combat forces were headed home by the end
of summer 2010.
7) Repeal "Don't Ask, Don't Tell"
In the final weeks of a lame duck session, Congress
overturned a 17-year-old policy known as "Don't Ask, Don't Tell"
which banned gays and lesbians from serving openly in the military. The repeal
calls for a transition period so that the Department of Defense can train all
forces by this summer and implement the repeal in the fall.
By signing the repeal of "Don't Ask, Don't Tell"
into law on December 22, 2010, President Obama kept another campaign promise.
8) Sign a ‘Universal' Health care Bill
Last but certainly not least is the promise Mr. Obama made
to sign a universal health care bill. Although the Patient Protection and
Affordable Care Act has many detractors, this has to be considered a major
promise kept by President Obama.
On March 23, 2010 after months of political battles on
Capitol Hill, President Obama signed Democrat-passed health care reform into
law, triggering a firestorm that is still working its way through the courts.
Many legal scholars and pundits expect the matter will ultimately be resolved
in the Supreme Court
Trippi adds that no president can keep all of his campaign
promises, yet on the biggest issues, such as Iraq and health care reform, Obama
did make good on pledges he made on the trail.
"More importantly the 2012 presidential election will
be won on issues of the day, not promises from 2008," Trippi said.
"The buck stops on President Obama's desk now, you can't blame President
Bush anymore. So if the economy is good and we feel safe as a nation in November
of 2012, he's looking good, however if unemployment is at nine percent, the
president could be in trouble."
The president meanwhile seems eager to talk about his
accomplishments rather than specific promises. During a conference call with
thousands of grassroots supporters Monday night Obama ticked off some of his
signature accomplishments such as health care legislation, Wall Street reform
and the repeal of "Don't Ask, Don't Tell." The president told
listeners that in only two years his administration had produced "the most
successful legislative initiative" of any president over the last 50
years. "I think it's important to remind people what we have
accomplished."
*PolitiFact calls itself "a project of the St.
Petersburg Times to help you find the truth in American politics. Reporters and
editors from the Times fact-check statements by members of Congress, the White
House, lobbyists and interest groups and rate them on our Truth-O-Meter."
Fox News
Fox News
ACORN Scandal Could Embarrass Obama
By
Peter Roff, Thomas Jefferson Street blog
During
the 2008 presidential campaign, Democrats portrayed Barack Obama's background
as a "community organizer" as a plus, something to be admired,
something that established his connection to regular people. Even though most
people were unable to explain in any meaningful way what a "community
organizer" actually did.
You
don't hear too much about that aspect of his life these days, possibly because
of the questions that keep coming up about ACORN—the Association of Community
Organizations for Reform Now—and its affiliates: What they do, how they do it,
where they get their money, how they spend it, and where the funds that
apparently went missing have gone to?
The
latest series of questions involves an embezzlement scandal that the News Orleans Times-Picayune says could involve amounts as
high as $5 million. "An internal review by the board of directors of the
community organization ACORN determined that the amount allegedly embezzled
from the community organization was $5 million, well more than the previously
reported amount of nearly $1 million," the paper reported Monday, citing a
subpoena issued by Louisiana Attorney General Buddy Caldwell, a Democrat.
The
news has Republicans fighting mad, especially over Congress's refusal to
investigate the matter.
David
Norcross, chairman of the Republican National Lawyers Association, accused
Congress today of shirking its responsibility to the U.S. taxpayers and called
on congressional leaders to increase their oversight of the organization.
"ACORN
has in great likelihood defrauded the U.S. government and, by extension, the
American people," Norcross said in a statement. "While some in
Congress may view allegations of ACORN abusing the public trust as an
unfortunate inconvenience, the public understands the severity of the
accusations, and will hold public officials—who are unwilling to do their
jobs—accountable." Going further, Norcross raised the specter of a
"special prosecutor" to look into the matter, saying that—with
respect to ACORN—the idea now merits "serious consideration."
It is
highly unlikely that U.S. Attorney General Eric Holder would take such a
step—but it may be unnecessary. The investigations currently underway in Louisiana
and elsewhere may uncover more than a Washington-centered investigation
conducted by nominal "friends of ACORN" ever could. And which could
potentially prove embarrassing, very embarrassing, to President Obama and some
of his closest aides inside the White House.
This article was just one of many articles upon articles which report, analyze, and tried to explain the dynamics of the housing bubble crash in 2008. I've looked for one article which comprehensively explains how the whole scenario evolved and played out which brought us to the financial dilemma we now face today. The dilemma President Obama likes to blame the Bush administration for. The most exhaustive chronology is documented on "Wikipedia", but if you research as I have on "Google" you will turn up the names of Democrats like President Clinton and Congressman like Chris Dodd and Barny Frank who drove legislation to encourage financial lenders to make home mortgages available to low income buyers. You may also run across legislation like the 1977 Community Reinvestment Act (CRA) and the 1992 Federal Housing Enterprise Financial Safety and Soundness Act (GSA).
You also may run across blogs and emails posted by President Bush warning of what he saw as problems with these practices. As for my research of the subject and having lived through the crisis, I can say the crash was precipitated by the Democrats. I found legislation going back to the 1970's which was connected to the crash and I can see how big the problems with "Affordable Home Loans" was and how no one saw it coming, with maybe the exception of President Bush. So for President Obama to make statements like the recession happened before he became president and blame it on the previous administration is just unacceptable. That's why he was elected. To lead! I would like to reprint another article from the "Atlantic" for consideration:
Hey, Barney Frank: The Government Did Cause the
Housing Crisis
By Peter Wallison
Dec 13 2011, 11:20 AM
A member of
the Financial Crisis Inquiry Commission responds to our interview with Barney
Frank, arguing that without the government's intervention, there would be no
housing crisis
On December
9, The Atlantic published online an interview with Congressman Barney
Frank. In it, he called me a "real extremist." This name-calling was
not only false but also inappropriate to the seriousness of the issue -- which
is whether government housing policy, and not the banks or the private sector,
caused the 2008 financial crisis. I decided to respond to both Congressman
Frank's statements and the questions he was asked about government housing
policy and the financial crisis.
We're
hearing Republicans in the presidential primary blame the housing crisis on the
Clinton-era push to lend more to poor people. In your view, what caused the
mortgage crisis and subsequently the financial crash?
Congressman
Frank, of course, blamed the financial crisis on the failure adequately to
regulate the banks. In this, he is following the traditional Washington
practice of blaming others for his own mistakes. For most of his career, Barney
Frank was the principal advocate in Congress for using the government's
authority to force lower underwriting standards in the business of housing
finance. Although he claims to have tried to reverse course as early as 2003,
that was the year he made the oft-quoted remark, "I want to roll the dice
a little bit more in this situation toward subsidized housing." Rather
than reversing course, he was pressing on when others were beginning to have
doubts.
It is government's fault for offering a housing
finance program without making an effort to maintain underwriting standards.
His most
successful effort was to impose what were called "affordable housing"
requirements on Fannie Mae and Freddie Mac in 1992. Before that time, these two
government sponsored enterprises (GSEs) had been required to buy only mortgages
that institutional investors would buy--in other words, prime mortgages--but
Frank and others thought these standards made it too difficult for low income
borrowers to buy homes. The affordable housing law required Fannie and Freddie
to meet government quotas when they bought loans from banks and other mortgage
originators.
At first,
this quota was 30%; that is, of all the loans they bought, 30% had to be made
to people at or below the median income in their communities. HUD, however, was
given authority to administer these quotas, and between 1992 and 2007, the
quotas were raised from 30% to 50% under Clinton in 2000 and to 55% under Bush
in 2007. Despite Frank's effort to make this seem like a partisan issue, it
isn't. The Bush administration was just as guilty of this error as the Clinton
administration. And Frank is right to say that he eventually saw his error and
corrected it when he got the power to do so in 2007, but by then it was too
late.
It is
certainly possible to find prime mortgages among borrowers below the median
income, but when half or more of the mortgages the GSEs bought had to be made
to people below that income level, it was inevitable that underwriting
standards had to decline. And they did. By 2000, Fannie was offering
no-downpayment loans. By 2002, Fannie and Freddie had bought well over $1
trillion of subprime and other low quality loans. Fannie and Freddie were by
far the largest part of this effort, but the FHA, Federal Home Loan Banks,
Veterans Administration and other agencies--all under congressional and HUD
pressure--followed suit. This continued through the 1990s and 2000s until the
housing bubble--created by all this government-backed spending--collapsed in
2007. As a result, in 2008, before the mortgage meltdown that triggered the
crisis, there were 27 million subprime and other low quality mortgages in the
US financial system. That was half of all mortgages. Of these, over 70% (19.2
million) were on the books of government agencies like Fannie and Freddie, so
there is no doubt that the government created the demand for these weak loans;
less than 30% (7.8 million) were held or distributed by the banks, which
profited from the opportunity created by the government. When these mortgages
failed in unprecedented numbers in 2008, driving down housing prices throughout
the U.S., they weakened all financial institutions and caused the financial
crisis.
Congressman
Frank makes assertions about who was responsible, but he, like all those who
hold his position, have no data. He says that the banks were responsible, but
cannot challenge the numbers I have outlined above. These numbers show, beyond
question, that it was government housing policy that caused the financial
crisis. Even he has admitted it. In an interview on Larry Kudlow's show in
August 2010, he said "I hope by next year we'll have abolished Fannie and
Freddie ... it was a great mistake to push lower-income people into housing
they couldn't afford and couldn't really handle once they had it."
Have the
Republicans "blame the housing crisis on the Clinton-era push to lend more
to poor people" as The Atlantic's question to Frank suggested? Of
course not. Those who took advantage of the opportunity offered by the
government's policies are not to blame for the crisis, just as those who make
use of Medicare or other government programs are not responsible for the
government's current debt problems. It is the government's fault for offering a
housing finance program without making any effort to prevent the deterioration
in mortgage underwriting standards.
Finally,
Congressman Frank calls me an "extremist" and says that I blamed the
housing crisis on the Community Reinvestment Act. That just shows he hasn't
read anything I've written, but remains chained to his partisan prejudices. I
was a member of the Financial Crisis Inquiry Commission, appointed by Congress
to investigate the causes of the 2008 financial crisis. I dissented from the
FCIC's majority report, and in my dissent, I used the data above to indict
government's housing policy. The Community Reinvestment Act (CRA)--which
required banks to make mortgage loans to borrowers that were riskier than their
normal loans--was certainly a part of the same government-quota approach that
underlay the affordable housing requirements and was strongly supported by
Congressman Frank. However, as far as I can tell, CRA was a relatively small
contributor to the crisis, when compared to the GSEs and the affordable housing
requirements. In any event, the FCIC acquitted the CRA from any responsibility
for the crisis before it even began its study, and resisted all my efforts to
find out more about the effect of the Act.
You said
Fannie Mae and Freddie Mac did have a role in pushing this along. How heavily
do you think they contributed?
Congressman
Frank's response was "They were not the major factor. Let's put it this
way: I think you would have had a crisis without them." Once again, Frank
makes assertions without numbers. Of the 19.2 million subprime and low quality
loans that were on the books of government agencies in 2008, 12 million (about
62%) were held or guaranteed by Fannie and Freddie. No one who has grasped the
significance of these numbers--and there is much more data in my dissent--could
believe that Fannie and Freddie were "not a major factor." It was the
unprecedented number of delinquencies and defaults among these mortgages, as I
noted above, that drove down housing prices all over the country and caused the
financial crisis. The data and my analysis led me to a conclusion that is
exactly the opposite of Congressman Frank's: if it hadn't been for the
government's housing policy, there would not have been a financial crisis.
In the
presidential race, how would you grade Republicans' grasp of the history of the
financial crisis, and would you say they're distorting it?
Congressman
Frank's response was that Republicans have been distorting the history of the
crisis. However, the real history of the deterioration of mortgage underwriting
standards, and the reasons for it, are outlined above. For most of his career,
Congressman Frank was one of the leaders of the effort in Congress to meet the
demands of activists like ACORN for an easing of underwriting standards in
order to make home ownership more accessible to more people. It was perhaps a
worthwhile goal, but it caused the financial crisis when it was done by
lowering mortgage underwriting standards. In the end, it was a colossal policy
error by Congress and two presidential administrations. Frank admitted this in
the Kudlow interview above. To his credit, Frank recognized his error by 2007,
but by that time it was too late. Fannie and Freddie were nearing insolvency
and the housing market was so engorged with subprime and other low quality
mortgages that nothing could save it.
The Atlantic Dec, 13 2011
Eric Holder is in the news again - something about being held in contempt of Congress over something to do with guns? Some how it reminds me on the "Iran Contra" scandal during the end of the Regan administration. I think when your house is dirty you should clean it!
House
votes to hold Attorney General
Eric Holder in contempt
Eric Holder in contempt
By , The Washington Post
The vote — 255 to 67,
with 108 Democrats abstaining — capped weeks of partisan sniping over Holder’s
decision not to turn over a set of documents that lawmakers had sought as part
of their 18-month-long probe into “Fast and Furious,” as the case was known.
As part of the
operation, run by the Bureau of Alcohol, Tobacco, Firearms and Explosives, agents
watched as more than 2,000 guns hit the streets. Two guns tied to the operation
were found at the scene of the death of a U.S. Border Patrol agent.
As part of the
operation, run by the Bureau of Alcohol, Tobacco, Firearms and Explosives, agents
watched as more than 2,000 guns hit the streets. Two guns tied to the operation
were found at the scene of the death of a U.S. Border Patrol agent.
In a statement,
Holder described the vote as “the regrettable culmination of what became a
misguided — and politically motivated — investigation during an election year.”
He accused Republicans leading the investigation of focusing “on politics over
public safety.”
House Speaker
John A. Boehner (R-Ohio) disputed such accusations. “I don’t take
this matter lightly and, frankly, hoped it would never come to this,” he said
from the House floor before the vote. “The House is focused on jobs and the
economy. But no Justice Department is above the law, and no Justice Department
is above the Constitution, which each of us has sworn an oath to uphold.”
Although the
GOP-led House was widely expected to sanction Holder, it’s not clear whether
the vote will get Republicans the documents they had requested. In the coming
days, lawmakers will press to have criminal charges filed against the attorney
general. But the decision of whether to do so will be made by the U.S. attorney
for the District, Ronald C. Machen Jr.,
who ultimately reports to Holder.
The House also
voted Thursday to authorize civil action against Holder, a move that paves the
way for a federal court challenge to President Obama’s decision to invoke
executive privilege over some of the documents being sought.
For Republicans,
however, the citation served as a symbolic blow to the nation’s highest law
enforcement officer, who, by some accounts, is the first sitting Cabinet member
to ever have been held in contempt of Congress.
Before the vote,
several Democrats walked off the House floor to protest what they characterized
as an investigation, backed by the National Rifle
Association, to embarrass Holder and the White House. Led by House
Minority Leader Nancy Pelosi (D-Calif.) and House Minority Whip Steny H. Hoyer
(D-Md.), about 100 members exited through the main center door of the House
floor and then walked solemnly and silently down the front steps of the U.S. Capitol
with television cameras rolling and tourists looking on.
Under the hot
summer sun, member after member denounced the vote as a sham. “This is a
terrible day for the House of Representatives,” said Rep. Emanuel Cleaver II
(D-Mo.), chairman of the Congressional Black Caucus. “We are declaring, by
walking out, we are not participating.”
The Washington Post
This is not only a problem with the President but seems to be a problem with Democrats in general. If you will remember President Clinton was impeached for "Perjury and Abuse of Power" during the Paula Jones law suite with Monica Lewinsky which stemmed from sexual misconduct between President Clinton and Ms. Lewinsky in 1998.
Personally; there are two rules which I follow when I am confronted with confusing issues, but before I apply these rules I ask myself why is there a controversy in the first place? That question brings the issue into much clearer focus. If I'm still confused or uncertain then the two rules come into play.
- Rule # 1: If it walks like a duck and quacks like a duck - then it's a duck!
- Rule # 2: If the snake bites you once it's his fault - If he bites you twice then it's your fault!
Next week we will be looking at the "Romney Files" and also coincidentally "The Republican National Convention", Aug 27 -30, 2012 in Tampa FL. So until then, I'm Felicity Blaze Noodleman.
* Photography courtesy "Google Images". Photography contained
within the below article reprints originated from those articles.
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