I’m relatively new to really REALLY watching politics. I guess, in the past, I didn’t care. Mostly I was single, renting and didn’t make enough money to care about taxes. The last decade has seen that ALL change. I am no longer single, I have children, own a home, make more money and am seriously considering starting my own business. I also spend more time at home than I used to spend before all the changes aforementioned. Combine this with the very compelling story of last year’s election; first time in many years that a President or Vice President wasn’t running, and you have good drama. AND we would have the opportunity to see America’s first woman or black Presidential candidate. All good political drama.
Back to my point. I am really pretty new to political theater. So, maybe as I say this, it’s really not so unusual. Could even be par for the course. But to me, this is absolutely stunning. Not only in the hypocrisy of it all, but in the sheer ignorance of any semblance of economic thinking.
WASHINGTON (Reuters) – The Obama administration pledged on Thursday to back beleaguered mortgage finance giants Fannie Mae and Freddie Mac no matter how big their losses may be in the next three years.
Serious? Banks are paying BACK their TARP funds and these guys are asking for, and getting, more money? At least they’ll have to be smart in their use of it, right?
It also jettisoned a demand that the two companies cut the size of their mortgage-related investment portfolios next year, allowing them to provide even more support in the near term for a housing market recovering from its worst slump in decades.
Nope. Business as usual; continue to sell money to people who can’t afford it.
So, how is it that some businesses are capped and controlled and can’t WAIT to get out from under government control while others seem unable to even WANT to get out? Is it political or is it simply a way of life? Is it really possible that the Obama administration is giving political favors to supporters or, perhaps, does he simply think that a fascist* banking system is the most effective method by which to establish financial systems?
The Treasury’s announcement came just hours after the companies said their chief executives would be paid up to $6 million on an annualized basis for 2009.
Fannie Mae and Freddie Mac are congressionally chartered companies that buy up mortgages from banks and other originators to keep mortgage markets liquid. Some of the debt is repackaged as securities and sold off to investors, and the government has been buying an increasing share.
Sadly, for Liberty loving people, it would seem that the answer is “Both”. Obama is both paying political favors, $6 million to the CEOs, AND feels that economic fascism is the preferred method of financial systems.
Like I said, I am new to this. Maybe this is business as usual. But from the cheap seats, this is ugly.
* From wiki: Fascists promoted their ideology as a “Third Position” between capitalism and communism. Italian Fascism involved corporatism, a political system in which the economy is collectively managed by employers, workers and state officials by formal mechanisms at national level. Fascists advocated a new national class-based economic system, variously termed “national corporatism”, “national socialism” or “national syndicalism”. The common aim of all fascist movements was elimination of the autonomy or, in some cases, the existence of large-scale capitalism.
Fascist governments exercised control over private property but did not nationalise it. They pursued economic policies to strengthen state power and spread ideology, such as consolidating trade unions to be state or party-controlled.