Updates Below – McCain ads

Now we know why Obama wants to raise taxes – to bail out those jerks who tanked our mortgage markets and nearly sent us into a real depression. First off it is good to get a little history on what led to this mess. Michael Reagan does a good job of laying out the story, but this part is worth noting and remembering:

To find the donkey, you need to go back to the Clinton administration, which decided that everybody and his kid brother was entitled to a mortgage even when they didn’t begin to qualify for a home loan.

In saner days, banks designated certain areas as no-loan zones — depressed neighborhoods where lending money to potential home buyers was not just a risky investment, but a certain future foreclosure.

Critics of the practice called it “redlining,” and President Clinton and his chums on Capitol Hill decided that banks should no longer act like banks and lend money only to home buyers who could afford to handle the monthly payments. 

Remember, Clinton left office with the economy a mess after the dot.com bubble burst too. This is what happens when you let inexperienced people with radical and naive ideas become president. One of the people key to this mess is Franklin Raines – who has ties to both Clinton and Obama:

Franklin Delano Raines (born January 14, 1949 in Seattle, Washington) is the former chairman and chief executive officer of Fannie Mae who served as White House budget director under President Bill Clinton.

…

 In 1991 he became Fannie’s Mae’s Vice Chairman, a post he left in 1996 in order to join the Clinton Administration as the Director of the U.S. Office of Management and Budget, where he served until 1998. In 1999, he returned to Fannie Mae as CEO, “the first black man to head a Fortune 500 company.”^[1]

In 2006, the OFHEO announced a suit against Raines in order to recover some or all of the $50 million in payments made to Raines based on the overstated earnings [2] initially estimated to be $9 billion but have been announced as 6.3 billion.^[2].

As everyone noted this guy was the first black CEO of a fortune 500 firm it becomes clear we cannot select leaders based on their race, or whether it advances their race. We need to pick leaders based on the content of their character, judgement and plans. Anyway, after setting up this mess and stealing a few million Raines ended giving advice to the Obama campaign.

Even more troubling is the fact that the two top beneficiaries of political donations from failed Fannie Mae and Freddie Mac over the last 9 years were Sen Chris Dodd  (#1) and Barack Obama (#2). First off, I cannot fathom how a quasi-government company controlling 100’s of millions of dollars in mortgage payments from Americans across this country can line the pockets of the politicians supposedly overseeing them.

This is criminal. They take our mortgage payments and send some of it to the politicians – all the time running the entire thing into the ground?  Folks, they took our mortgage payments, got rich, bribed some pols and sit fat and dumb in million dollar homes – paid for by us. And now we will pay more to fix the mess they left behind. Obama is in this up to his neck, since he got more money than any other senator save one, and he did it while in office only three of the 9 years covered.

And how much campaign money is he getting from this debacle? I tell you what, I thought I was angry about how the Political Industrial Complex was ripping me off through taxes. But now that I see they took my mortgage payments and did this with them really steams me.

Obama’s connections don’t stop there. He has another ‘leader of industry’ on his team who led his company to ruin and voter buy-outs: Jim Johnson of Fannie Mae:

Big Democrat Jim Johnson, recently on Obama’s VP search committee, has hauled in millions from his Fannie Mae CEO job.

BTW, Neal Bortz had a front row seat to the debacle and also does a good job reviewing it. A snippet:

Washington made it clear to banks and other lending institutions that if they did not do something .. and fast .. to bring more minorities and low-income Americans into the world of home ownership there would be a heavy price to pay. Congress set up processes (Research the Community Redevelopment Act) whereby community activist groups and organizers could effectively stop a bank’s efforts to grow if that bank didn’t make loans to unqualified borrowers. Enter, stage left, the “subprime” mortgage. These lenders knew that a very high percentage of these loans would turn to garbage – but it was a price that had to be paid if the bank was to expand and grow. We should note that among the community groups browbeating banks into making these bad loans was an outfit called ACORN. There is one certain presidential candidate that did a lot of community organizing for ACORN. I won’t mention his name so as to avoid politicizing this column.

So this is change? Outright stealing our money to give to Pols until the bottom falls out, and leaving us the tab? I don’t think we can affort any more of team Obama’s hands on the economy.

Update: McCain has come out with a biting ad on this very topic today:

And the Washington Post comes out today debunking Obama’s claims about McCain’s record on calling for reform:

John McCain’s record on Wall Street oversight gets some misleading spin from Barack Obama.

It is an extensive smack down on Team Obama. One could easily conclude Obama’s ad is ignorant or outright false. Clearly it is not ‘presidential’.

Update: The Raines connection has always be a bit weak, but the connection to Jim Johnson, another Fannie Mae ‘leader’ who made millions is much more obvious since he did join the Obama campaign (until Fannie Mae blew up in his face and he quit). McCain’s new ad just reminds Americans who really is allied with those who cost us, our children, and our children’s children so much financial strain in our lives.

Tags: 2008 Election, Fannie Mae, Financial Crisis, Freddie Mac, Johnson, Obama, Raines