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Thread: Romney calls Obama’s handling of the economy ‘a moral failure of tragic proportions’

  1. #21
    SiriuslyLong is offline
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    Quote Originally Posted by Havakasha View Post
    Bush produced negative job growth over 4 years, helped to throw the country into its second worst recession, got us into 2 wars
    and paid for them off the books, all leading to massive unemployment and increasing debt. Brilliant.
    I'll give you the wars and even unfunded prescription drug plans, but the housing bubble (which caused the recession) had a lot of causes going back to Clinton deregulation, and of course, this........

    Ron Paul in the House Financial Services Committee, September 10, 2003

    Mr. Chairman, thank you for holding this hearing on the Treasury Department's views regarding government sponsored enterprises (GSEs). I would also like to thank Secretaries Snow and Martinez for taking time out of their busy schedules to appear before the committee.

    I hope this committee spends some time examining the special privileges provided to GSEs by the federal government. According to the Congressional Budget Office, the housing-related GSEs received $13.6 billion worth of indirect federal subsidies in fiscal year 2000 alone. Today, I will introduce the Free Housing Market Enhancement Act, which removes government subsidies from the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the National Home Loan Bank Board.

    One of the major government privileges granted to GSEs is a line of credit with the United States Treasury. According to some estimates, the line of credit may be worth over $2 billion. This explicit promise by the Treasury to bail out GSEs in times of economic difficulty helps the GSEs attract investors who are willing to settle for lower yields than they would demand in the absence of the subsidy. Thus, the line of credit distorts the allocation of capital. More importantly, the line of credit is a promise on behalf of the government to engage in a huge unconstitutional and immoral income transfer from working Americansto holders of GSE debt.

    The Free Housing Market Enhancement Act also repeals the explicit grant of legal authority given to the Federal Reserve to purchase GSE debt. GSEs are the only institutions besides the United States Treasury granted explicit statutory authority to monetize their debt through the Federal Reserve. This provision gives the GSEs a source of liquidity unavailable to their competitors.

    The connection between the GSEs and the government helps isolate the GSE management from market discipline. This isolation from market discipline is the root cause of the recent reports of mismanagement occurring at Fannie and Freddie. After all, if Fannie and Freddie were not underwritten by the federal government, investors would demand Fannie and Freddie provide assurance that they follow accepted management and accounting practices.

    Ironically, by transferring the risk of a widespread mortgage default, the government increases the likelihood of a painful crash in the housing market. This is because the special privileges granted to Fannie and Freddie have distorted the housing market by allowing them to attract capital they could not attract under pure market conditions. As a result, capital is diverted from its most productive use into housing. This reduces the efficacy of the entire market and thus reduces the standard of living of all Americans.

    Despite the long-term damage to the economy inflicted by the government's interference in the housing market, the government's policy of diverting capital to other uses creates a short-term boom in housing. Like all artificially-created bubbles, the boom in housing prices cannot last forever. When housing prices fall, homeowners will experience difficulty as their equity is wiped out. Furthermore, the holders of the mortgage debt will also have a loss. These losses will be greater than they would have otherwise been had government policy not actively encouraged over-investment in housing.

    Perhaps the Federal Reserve can stave off the day of reckoning by purchasing GSE debt and pumping liquidity into the housing market, but this cannot hold off the inevitable drop in the housing market forever. In fact, postponing the necessary, but painful market corrections will only deepen the inevitable fall. The more people invested in the market, the greater the effects across the economy when the bubble bursts.

    No less an authority than Federal Reserve Chairman Alan Greenspan has expressed concern that government subsidies provided to GSEs make investors underestimate the risk of investing in Fannie Mae and Freddie Mac.

    Mr. Chairman, I would like to once again thank the Financial Services Committee for holding this hearing. I would also like to thank Secretaries Snow and Martinez for their presence here today. I hope today's hearing sheds light on how special privileges granted to GSEs distort the housing market and endanger American taxpayers. Congress should act to remove taxpayer support from the housing GSEs before the bubble bursts and taxpayers are once again forced to bail out investors who were misled by foolish government interference in the market. I therefore hope this committee will soon stand up for American taxpayers and investors by acting on my Free Housing Market Enhancement Act.


    http://www.lewrockwell.com/paul/paul128.html

    If only the sheeple really knew what caused the recession. Democratic talking points are no match for this truth. In fact, those "blame Bush" talking points are really hiding the fact the KEY DEMOCRATS scoffed at the FREE HOUSING MARKET ENHANCEMENT ACT OF 2003.

    Most democrats typically employee and avoidence / diversion strategy when faced with the reality above. Truth is, THOSE DEMOCRATS ARE TO BLAME FOR THE ECONOMY. They were provided a chance TO ACT, but their RIGID IDEOLOGY rendered them useless TO ACT.

    Let's all pray that Romney makes note of this in his campaign.

  2. #22
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    Reich's solution...

    How? We might learn something from history. During the 1920s, income concentrated at the top. By 1928, the top 1 percent was raking in an astounding 23.94 percent of the total (close to the 23.5 percent the top 1 percent got in 2007) according to analyses of tax records by my colleague Emmanuel Saez and Thomas Piketty. At that point the bubble popped and we fell into the Great Depression.

    But then came the Wagner Act, requiring employers to bargain in good faith with organized labor. Social Security and unemployment insurance. The Works Projects Administration and Civilian Conservation Corps. A national minimum wage. And to contain Wall Street: The Securities Act and Glass-Steagall Act.

    In 1941 America went to war – a vast mobilization that employed every able-bodied adult American, and put money in their pockets. And after the war, the GI Bill, sending millions of returning veterans to college. A vast expansion of public higher education. And huge infrastructure investments, such as the National Defense Highway Act. Taxes on the rich remained at least 70 percent until 1981.

    The result: By 1957, the top 1 percent of Americans raked in only 10.1 percent of total income. Most of the rest went to a growing middle class – whose members fueled the greatest economic boom in the history of the world.

    Get it? We won’t get out of first gear until the middle class regains the bargaining power it had in the first three decades after World War II to claim a much larger share of the gains from productivity growth.


    Dear professor Reich (yet ANOTHER "liberal" professor?). This was nearly 80 years ago. Don't you think things have changed just a bit since then? Should we advocate warfare? Is that your message?

    Or are you suggesting a welfare state like your fellow professor Krugman openly prefers? I would call the WPA and CCC welfare programs though at least the actually built assets for society to use.

    The Glass Steigal Act? Didn't Clinton do away with it? Ah, nevermind, it's all Bush's fault LMFAO.

  3. #23
    Havakasha is offline
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    T 11:06 AM PDT
    Romney's Big Lie on the Economy Now Bigger than Ever
    byAvenging Angel

    If nothing else, you have to admire Mitt Romney's persistence. After he formally announced his candidacy a year ago by declaring when President Obama "took office, the economy was in recession, and he made it worse, and he made it last longer," fact checkers quickly demolished Romney's obvious falsehood. But despite his subsequent denial just days later that "I didn't say that things are worse," Governor Romney has never stopped regurgitating some version of his "Obama made the economy worse" lie.

    Now in advance of the President's major address on the economy Thursday in Cleveland, Mitt Romney is back with a new formulation of his fraud. Unfortunately for Romney, the facts and the overwhelming consensus of economists - including the nonpartisan Congressional Budget Office and John McCain's 2008 brain trust - flatly contradict Mitt's slander Wednesday that Obama "is not responsible for whatever improvement we might be seeing, instead he is responsible for the fact that it's taken so long to see this recovery and the recovery is so tepid." Instead, they insist, President Obama saved the American free-enterprise system from the abyss and averted Great Depression 2.0.


    http://www.dailykos.com/story/2012/0...gger-than-Ever

  4. #24
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    14 Jun 2012 02:04 PM
    Live-Blogging Obama's Cleveland Speech
    by Andrew Sullivan

    http://andrewsullivan.thedailybeast....nd-speech.html



    3.05 pm. My bottom line? A home run. Simply constructed, carefully reframed, aggressive while positive: the Obamaites have been listening to critics and are responding. If this is his message, and if he is able to keep articulating it this clearly, he will win. And in my view, the experience of the last thirty years is that he should win. If I have to choose between a governing philosophy espoused by Bill Clinton or one espoused by George W. Bush, it's a no-brainer. And I can't stand Bill Clinton.

    3.03 pm. Finally a vote of confidence in the American future. He says he sees even in deep economic distress "a stubborn hope and a fierce pride and a determination to overcome whatever challenges we face." It's a stem-winding patriotic ender - and a call for unity against the allure of cynicism. We have gone from "change you can believe in" to "change we need right now."

    2.58 pm. He redirects the attacks on him. "That may be a way to win an election. It is not a way to grow the economy." I love the phrase "the scary voice in the commercials." His position is that he wants a real debate about these two visions, a defining moment between 1980s conservatism or 1990s liberalism as the way forward. We're watching a fusion of Obama and Clinton here in his case for a second term. And there is the inevitable unstated pairing of Romney and Bush.

  5. #25
    SiriuslyLong is offline
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    Daily Kos............. LMFAO. Partisan drool that is simply based on timing.


    A poll --- in Lloyd's mind a poll is a scientific fact. Yes Lloyd, I know what the sheeple think; hence the comment below.

    "If only the sheeple really knew what caused the recession. Democratic talking points are no match for this truth. In fact, those "blame Bush" talking points are really hiding the fact the KEY DEMOCRATS scoffed at the FREE HOUSING MARKET ENHANCEMENT ACT OF 2003."

    People like you like to cover up this kind of stuff; brush it aside as if it is inconvenient. Like I've said in the past, say it enough and it becomes true. It is sad that liars and deniers like you are effective.

  6. #26
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    Why did Bush ask/order fannie mae to make 440 BILLION in home loans to minorities in 2002?
    I keep seeing the same lies being posted by republicans.
    The govt can not force a bank to make a risky loan.
    Republicans controlled congress 12 years from Jan 1995 to Jan 2007. They write or change the laws that banks have to follow.
    Republicans controlled the entire government 6 years from Jan 2001 to Jan 2007 when all the sub-prime loans were made. Dems had nothing to do with it...even bush's own banking experts have said this.
    Bush appoints the management of freddie mac and fannie mae and "asked" his appointees to make 440 BILLION in loans to poor minorities. He also asked for 2.4 billion in tax credits (corporate welfare) for homebuilders who build low income housing. And he asked for 200 million per year to pay the mortgage closing costs. (If the president appoints you to your job and asks you to do something, that is pretty much an order if you want to keep your job)

    http://georgewbush-whitehouse.archiv.../20020617.html

    This is what Bush's official press release states on June 17, 2002:
    "Today, President Bush announced a new goal to help increase the number of minority homeowners by at least 5.5 million before the end of the decade. The President's aggressive housing agenda will help dismantle the barriers to homeownership by providing down payment assistance, increasing the supply of affordable homes, increasing support for self-help homeownership programs, and simplifying the home buying process & increasing education.

    The President is issuing "America's Homeownership Challenge" to the real estate and mortgage finance industries to join in his effort to increase the number of minority homeowners by 5.5 million families by the end of the decade. Many organizations have already responded to the President's challenge by committing to:
    "Substantially increase by at least $440 billion, the financial commitment made by the government sponsored enterprises involved in the secondary mortgage market, specifically targeted toward the minority market"...
    "The President wants to dramatically increase the supply of homes available to low and moderate income families. The President has proposed the Single-Family Affordable Housing Tax Credit, which will provide approximately $2.4 billion to encourage the production of 200,000 affordable homes for sale to low and moderate income families."


    Did you know that bush's top donors were subprime mortgage lenders, real estate developers, and his campagin finance chairman is one of the biggest homebuilders in america...his name is dwight scharr and he lives in a 70 million mansion in palm beach.
    Did you know that Bush's cousin, Herbert Walker, was vice president of the Goldman Sachs department that placed TRILLIONS in bets that these people would not repay their loans.

    In 2003 the fbi warned of widespread mortgage fraud...ny attorney general spitzer started to sue predatory lenders but was stopped by the bush administration's Office of Comptroller of Currency who said banking regulation was soley a job of the federal government. All 50 state attorney generals, including many republicans, filed a lawsuit against the bush administration and they lost!

    Bush used the fed govt to stop ALL 50 states from investigating and prosecuting illegal mortgage fraud.

  7. #27
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    Quote Originally Posted by SiriuslyLong View Post
    I'll give you the wars and even unfunded prescription drug plans, but the housing bubble (which caused the recession) had a lot of causes going back to Clinton deregulation, and of course, this........

    Ron Paul in the House Financial Services Committee, September 10, 2003

    Mr. Chairman, thank you for holding this hearing on the Treasury Department's views regarding government sponsored enterprises (GSEs). I would also like to thank Secretaries Snow and Martinez for taking time out of their busy schedules to appear before the committee.

    I hope this committee spends some time examining the special privileges provided to GSEs by the federal government. According to the Congressional Budget Office, the housing-related GSEs received $13.6 billion worth of indirect federal subsidies in fiscal year 2000 alone. Today, I will introduce the Free Housing Market Enhancement Act, which removes government subsidies from the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the National Home Loan Bank Board.

    One of the major government privileges granted to GSEs is a line of credit with the United States Treasury. According to some estimates, the line of credit may be worth over $2 billion. This explicit promise by the Treasury to bail out GSEs in times of economic difficulty helps the GSEs attract investors who are willing to settle for lower yields than they would demand in the absence of the subsidy. Thus, the line of credit distorts the allocation of capital. More importantly, the line of credit is a promise on behalf of the government to engage in a huge unconstitutional and immoral income transfer from working Americansto holders of GSE debt.

    The Free Housing Market Enhancement Act also repeals the explicit grant of legal authority given to the Federal Reserve to purchase GSE debt. GSEs are the only institutions besides the United States Treasury granted explicit statutory authority to monetize their debt through the Federal Reserve. This provision gives the GSEs a source of liquidity unavailable to their competitors.

    The connection between the GSEs and the government helps isolate the GSE management from market discipline. This isolation from market discipline is the root cause of the recent reports of mismanagement occurring at Fannie and Freddie. After all, if Fannie and Freddie were not underwritten by the federal government, investors would demand Fannie and Freddie provide assurance that they follow accepted management and accounting practices.

    Ironically, by transferring the risk of a widespread mortgage default, the government increases the likelihood of a painful crash in the housing market. This is because the special privileges granted to Fannie and Freddie have distorted the housing market by allowing them to attract capital they could not attract under pure market conditions. As a result, capital is diverted from its most productive use into housing. This reduces the efficacy of the entire market and thus reduces the standard of living of all Americans.

    Despite the long-term damage to the economy inflicted by the government's interference in the housing market, the government's policy of diverting capital to other uses creates a short-term boom in housing. Like all artificially-created bubbles, the boom in housing prices cannot last forever. When housing prices fall, homeowners will experience difficulty as their equity is wiped out. Furthermore, the holders of the mortgage debt will also have a loss. These losses will be greater than they would have otherwise been had government policy not actively encouraged over-investment in housing.

    Perhaps the Federal Reserve can stave off the day of reckoning by purchasing GSE debt and pumping liquidity into the housing market, but this cannot hold off the inevitable drop in the housing market forever. In fact, postponing the necessary, but painful market corrections will only deepen the inevitable fall. The more people invested in the market, the greater the effects across the economy when the bubble bursts.

    No less an authority than Federal Reserve Chairman Alan Greenspan has expressed concern that government subsidies provided to GSEs make investors underestimate the risk of investing in Fannie Mae and Freddie Mac.

    Mr. Chairman, I would like to once again thank the Financial Services Committee for holding this hearing. I would also like to thank Secretaries Snow and Martinez for their presence here today. I hope today's hearing sheds light on how special privileges granted to GSEs distort the housing market and endanger American taxpayers. Congress should act to remove taxpayer support from the housing GSEs before the bubble bursts and taxpayers are once again forced to bail out investors who were misled by foolish government interference in the market. I therefore hope this committee will soon stand up for American taxpayers and investors by acting on my Free Housing Market Enhancement Act.


    http://www.lewrockwell.com/paul/paul128.html

    If only the sheeple really knew what caused the recession. Democratic talking points are no match for this truth. In fact, those "blame Bush" talking points are really hiding the fact the KEY DEMOCRATS scoffed at the FREE HOUSING MARKET ENHANCEMENT ACT OF 2003.

    Most democrats typically employee and avoidence / diversion strategy when faced with the reality above. Truth is, THOSE DEMOCRATS ARE TO BLAME FOR THE ECONOMY. They were provided a chance TO ACT, but their RIGID IDEOLOGY rendered them useless TO ACT.

    Let's all pray that Romney makes note of this in his campaign.
    Blame Bush LMFAO. Clinton ended the Glass Steagall Act....... Democrats $hit on tougher GOVERNMENT oversight of Fannie Mae and Freddie Mac. Democrats $hit on THE FREE HOUSING MARKET ENHANCEMENT ACT OF 2003 even though Dr. Paul explained how a bubble was being inflated and that ORDINARY AMERICANS WILL GET HURT... It was clearly explained to Maxine Waters and Barney Frank IN 2003.

    Imagine if they the democrats acted??

    Keep on denying. The truth will eventually be found BY ALL.

  8. #28
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    http://www.huffingtonpost.com/2012/0...n_1609089.html
    If Mitt Romney is elected president, the U.S. will experience an economic disaster the likes of which have been recently seen in Ireland, according to Paul Krugman.

    "Ireland is Romney economics in practice," the Nobel-Prize winning economist and New York Times columnist said on the Colbert Report on Monday. "I think Ireland is America's future if Romney is president." (h/t Politico.)

    "They've laid off a large fraction of their public workforce, they've slashed spending, they've had extreme austerity programs, they haven't really raised taxes on corporations or the rich at all, they have 14 percent unemployment, 30 percent youth unemployment, zero economic growth," Krugman said.

    Romney, the likely Republican nominee for president, recently suggested that the government should lay off more firemen, policemen, and teachers, according to CNN. Romney's campaign website says that if elected president, Romney would aim to slash federal spending at least 18 percent by the end of his first term.

    Conservatives like Romney loved Ireland's economic program before the country fell into a depression, in part because it had "the lowest corporate tax rates," Krugman said on the Colbert Report. Ireland fell into recession again at the end of last year.

    After Krugman finished his criticism of Romney's economic plan, there was a pause as Colbert tried to think of a good retort. "Well the Irish can handle it, OK? The Irish do very well in bleak, depressing times," Colbert said. "They've got those jigs and everything that they do."

  9. #29
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    Krugman is a democrat. Democrats and their rigid ideology are just about SOLELY responsible for the housing crisis of 2008 (see previous facts). Clearly, any democrat who casts doubt on their rival party cannot be trusted for the reason of their record, and their clear partisanship.

    A healthy, profit generating private sector is the key to the economy. Period. Commerce generates taxes.

    The democrat solution: more public sector jobs. Yes, the government pays the public employee $1.00 and the employee returns $0.15 in taxes. What a wonderful economic model!!!

  10. #30
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    Krugman looks at the example of Ireland, which followed the austerity program pushed by the Germans and so valued by advocates of things like the Ryan budget proposal. THe Irish lost 28,000 public sector jobs, which when extended proportionally to the population ratio between Ireland and the U. S. would equal laying off 1.9 million public sectors workers here, and the result? Ireland's unemployment rate (U-3 model) is at 14% -

    Ireland’s experience shows that austerity in the face of a depressed economy is a terrible mistake to be avoided if possible.
    Krugman also notes that the US has the ability to borrow right now, and at historically low rates, to fund stimulus. We can do what the Irish, as part of the Euro zone, could not do on its own. This would allow the Federal government to help states and local governments who cannot run deficits maintain or even increase public sector employment and thus blunt the impact of the recession. Why more public sector employees? How about serving the additional folks on unemployment, needing food stamps, etc.?
    Romney's words about teachers, fireman and police are an honest representation of his thinking. He doesn't want the federal government to do this.

    So the former governor of Massachusetts was telling the truth the first time: by opposing aid to beleaguered state and local governments, he is, in effect, calling for more layoffs of teachers, policemen and firemen.
    Actually, it’s kind of ironic. While Republicans love to engage in Europe-bashing, they’re actually the ones who want us to emulate European-style austerity and experience a European-style depression.

    Read that last sentence carefully - Krugman is being blunt - that the austerity approach in Europe is creating a European-style depression.
    Those watching the Euro Cup competition have heard about it. Traditionally in the round-robin portion of international soccer competitions there is the toughest group of four out of which to be one of two qualifiers, and it is called the Group of Death. This year, in addition, there is a group which contains Croatia (not part of the Euro Zone), Italy, Spain, and Ireland - it has been tagged with the moniker of the Group of Debt, since already Ireland and Spain have had major financial issues and the economy of Italy is not that far behind.

    People are waiting to see how those in Greece vote in the next round of elections, whether the Greeks will pull out of the Euro. Certainly there is anticipation they will - there has been a severe run on banks in Greece this week.

    In the meantime, many people around Europe and around the world are coming to the conclusion that the austerity approach insisted upon by the Germans is the wrong path. Krugman writes

    almost everyone following the situation now realizes that Germany’s austerity obsession has brought Europe to the edge of catastrophe — almost everyone, that is, except the Germans themselves and, it turns out, the Romney economic team.
    One could in fact look at the counter example of Iceland, one of the earliest economies in trouble, which took a different path and which has seen its economy return to stability.
    Krugman concludes by noting the implications if Romney wins being disastrous, because

    all indications are that his idea of smart policy is to double down on the very spending cuts that have hobbled recovery here and sent Europe into an economic and political tailspin.
    Romney and Ryan and people like that do not seem to care. They seem to think that the health of an economy is measured at the top. At least since Andrew Jackson, as Jim Webb likes to point out, most Democrats have instead measured the health of the economy by how those at the bottom are doing.
    Except for Romney, the top is very narrow - he would gain personally at least $5 million in tax cuts while most Americans, certainly those in the bottom 80%, would see their overall tax burden increase, while the government services they receive from all levels of government - Federal, state and local - would be severely slashed.

    You may not be happy with the Obama administration on many fronts. Certainly I am not on policies ranging from education to civil liberties. But as Van Jones pointed out at Netroots Nation last weekend, when we look at the President

    We have stopped comparing him to the Almighty ... and started comparing him to the alternative.
    Krugman's column reinforces this. Economically Romney's approach would destroy this nation, the hopes and futures of most Americans, and turn us into a basket case as bad as the worst of Europe.

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