Crush Liberalism

Liberalism: Why think when you can “feel”?

Barry O trying to be like FDR

But not in the positive sense (i.e. war leadership). From Forbes:

“Fine the lenders!” writes Barack Obama here.

Hoping to prop up his poopy presidential primary campaign, Obama says we should round up “the unlicensed, unregulated, fly-by-night mortgage brokers who are hoodwinking low-income borrowers into taking on loans they cannot afford” and treat them as “the criminals they are.”

Who, exactly, are these criminals? How does one identify them? What laws does one use to punish them? Obama, the lawyer, oddly never answers these questions.

In her wonderful book, The Forgotten Man–the book of the year–Amity Shlaes writes how FDR would tell his minions to ignore or retroactively change the law when going after wealthy businessmen such as Andrew Mellon.

Shlaes writes:

The president told Congress that though Washington had raised its tax rates, the Treasury was still short $600 million. Roosevelt blamed not the arrangement but the wealthy themselves. Roosevelt, [Treasury Secretary Henry] Morgenthau would tell Treasury officials, “wants to say flatly that our estimates and our methods of estimating are correct, but the citizens–that’s the word he used–found a trick way of finding loopholes.” Roosevelt insisted that these “loopholes be closed and that they be retroactive.”

If revenues were wanting, Roosevelt didn’t mind investigating, prosecuting or legislating his way to them.

Panicked for cash, Morgenthau now had his Treasury set about trying to create dozens of Mellons. Roswell Magill of the department audited individual returns in New York and found, according to Morgenthau’s diary, that citizens were using old tax breaks–legally, mostly. But Roosevelt was now set on erasing the old distinction between evasion and avoidance that the Treasury had danced around for so long.

Roosevelt also set out to prove that the intention of the taxpayer who failed to complete complex returns correctly was malign: Where there was ambiguity, taxpayers ought to be presumed guilty.

By 1937, investors and businessmen were sick of FDR’s capriciousness. Capital went on strike. Businessmen stopped investing and hiring. The 1932-1936 recovery collapsed, leaving “a depression within a depression,” writes Shlaes. Consequences were dire. In Brooklyn, in 1937, a 13-year-old boy named William Troeller hanged himself. The boy worried that his parents and five siblings weren’t getting enough food.

When Obama calls mortgage lenders criminals but doesn’t specify the laws broken, he’s playing with fire. Retroactive prosecution, hinted by Obama, is tyranny, plain and simple. 

Pandering to the economic illiterates in this country is the modus operandi of the left. Sometimes it works, sometimes it doesn’t. In BHO’s case, I doubt it works, especially with all of that empty suit’s other gaffes considered.

August 30, 2007 - Posted by | economic ignorance, Obama

3 Comments »

  1. Oddly enough, most of the economically challenged of this nation follow Republicans. I have no idea why, when many policies passed by the GOP seem to hurt the hell out of them. Smaller government is a big theme of the party, which means less funding for government programs, which means less money in their pockets at the end of the day. I’ll never understand it.

    Given, in the past, the GOP was really for the little guy but it’s hard to see exactly how that relationship works now. It’s like people only say “40 years ago they did it!” and vote away. Strange.

    The people applying and accepting the loan deals are responsible for their own shit. Nuff said. No bailouts for them or the companies now going bankrupt because they got greedy and pushed these loans through, knowing full well people would eventually get screwed. The homeowners should have become better informed about the terms and exactly what they mean. Both sides, lender and lendee, are to blame for this situation and neither deserve a handout from the government because of it.

    Comment by wailin | August 30, 2007

  2. we should round up “the unlicensed, unregulated, fly-by-night mortgage brokers who are hoodwinking low-income borrowers into taking on loans they cannot afford”

    Whatever happened to PERSONAL RESPONSIBILITY Hussien? If you’re too stupid to know that if you make $25,000 a year, you can’t afford to buy a $400,000 home, you haven’t been “hoodwinked” – you’re just an idiot!

    Comment by Kanaka Girl | August 30, 2007

  3. Oddly enough, most of the economically challenged of this nation follow Republicans.

    Rural Americans make up most of what you call “economically challenged” Americans, and they tend to have strong moral convictions and religious beliefs. Democrats have crapped on their beliefs for generations now, which is why they don’t pay much attention to the national Democrats. People can be kinda funny about having their core convictions belittled.

    I have no idea why, when many policies passed by the GOP seem to hurt the hell out of them. Smaller government is a big theme of the party, which means less funding for government programs, which means less money in their pockets at the end of the day.

    If I’m properly understanding what you’re trying to say here, then that’s got to be one of the more lame-brained statements I’ve seen from you, Wailin. Less funding for government programs equals less money in people’s pockets?? So people aren’t supposed to work for the money they want? It’s government’s role to give people money? Well, hell, I’ve been busting my hump at a real job for years now, all for naught! You’ve done me a wonderful service, my friend! I’m heading down to my local welfare office right now to get more government money in my pockets! Who needs the lottery? Early retirement, here I come!

    The people applying and accepting the loan deals are responsible for their own shit. Nuff said.

    We agree here.

    No bailouts for them or the companies now going bankrupt because they got greedy and pushed these loans through

    We agree here. But…

    knowing full well people would eventually get screwed.

    We can’t possibly agree here. That’s not a bright thing to say. If a lender knows that borrower will eventually default, why in God’s name would the lender LEND the money?? No, they do NOT make more money foreclosing on a house, because I happen to know that it costs lenders WAY more to recoup their money from a foreclosure or an aucton than they would get from the sale of the foreclosed/auctioned property. If you came to me and said “Can I have $100? I doubt I can pay it back,” do you honestly think I’d give you the money??

    Two things are happening here that get ignored: (1) the vast majority of subprime borrowers are still paying their mortgages on time and as they agreed; but in a slowing housing market, even a small minority of borrowers who default will be felt across the market. However, I heard (and feel free to take this with a grain of salt and research this yourself, since I don’t have the link to back me up) that the subprime defaults make up less than 1% of the total mortgage market. And (2) the sole reason that subprime lenders made these loans is because as with the stock market run in the mid- to late-’90s, people “in the know” never thought the fairy tale run would end, and thus felt that they wouldn’t be at risk of a down real estate market because that day would never come. “Irrational exhuberance”, if you will.

    The homeowners should have become better informed about the terms and exactly what they mean. Both sides, lender and lendee, are to blame for this situation and neither deserve a handout from the government because of it.

    And we’re back to agreeing again.

    But that leads me to a question, Wailin: if you don’t think that the government should be bailing out poor homeowners with bad credit and risk of foreclosure (presumably because that’s not government’s role), then why do you think an appropriate government role should be “putting money into people’s pockets”? Who gets to pick which “disadvantaged” groups get to receive the feds’ confiscated paychecks?

    Comment by Crush Liberalism | August 30, 2007


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