This excerpt from an article by Gregg Eastbrook makes some very interesting points on the Fannie-Freddie takeover, so I figured I'd share it with you guys.

Perhaps Washington had no choice but to take over Fannie Mae and Freddie Mac, considering what we now know about years of self-serving lying by the management of both institutions. But taxpayers have been put on the hook for at least $200 billion in loan guarantees. Buried in the conservatorship declaration is word Congress may add extra subsidies to Fannie and Freddie to keep mortgage interest rates low. Washington has been involved in many loan guarantees, but never in mortgage rates. This all-new subsidy will make mortgage markets political on a permanent basis -- any time rates rise, borrowers seeking mortgages will demand taxpayers subsidize them. By shifting to taxpayers (and to our children, via still more deficit spending) some of the cost of borrowing, this may only further distort the mortgage market, encouraging buyers and brokers to generate imprudent loans and then passing costs along to taxpayers.

Note another aspect of the Fannie-Freddie takeover that politicians don't want to talk about. On paper, the takeover looks like a bankruptcy. In a bankruptcy, creditors receive preference (because they hold a promise of payment) while shareholders are wiped out (because equity positions are speculative and known to buyers to guarantee nothing). The Fannie-Freddie takeover preserves the companies' bondholders, while making shareholders appear to get clobbered -- the government receives a warrant to claim up to 80 percent of shares, which would slash a share in Fannie or Freddie to 20 percent of current value. But the government must exercise that warrant. If not, shareholders are bailed out too. As soon as attention shifts to the next screw-up, lobbyists for the rich quietly will twist White House and Congressional arms for assurances the warrants are never exercised. If this happens, average people will be taxed to protect the wealth of Fannie and Freddie shareholders. "We only wish [Treasury Secretary Henry] Paulson had gone further and erased all private equity holders the way the feds do in a typical bank failure … [share]holders deserve to lose everything." Who said this, some left-wing fanatic? The editorial page of the Wall Street Journal.

Stock prices rise on news that corporate dividends will now be billed directly to taxpayers.
Anyway, get a load of the headline on the Treasury Department announcement of the takeover: TREASURY AND FEDERAL HOUSING FINANCE AGENCY ACT TO PROTECT FINANCIAL MARKETS AND TAXPAYERS. We're reaching into your pockets for hundreds of billions of dollars -- to protect you!

http://rawstory.com/news/2008/Lieberman_praises_pastor_repudiated_by_McCain_0723.html

 

Lieberman is continuing his descent into the dark side as he publicly praised John Hagee.

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Exit polls from the West Virginia primary revealed something very disturbing to me. There are a lot of people in West Virginia that are incapable of determining what is in their best interest.

Of Clinton supporters, 35% said they would vote for McCain over Obama. Of Obama supporters, 31% said they would vote for McCain over Clinton. What this means is that the overall political awareness of a large amount of West Virginia residents is abysmal.

I'm not going to cast any aspersions on either candidate here, but if my candidate of choice doesn't win I will vote for the other in a heartbeat. Clinton and Obama are very similar in their stances on almost every major issue (which is why so much of the campaign has focused on personality). McCain on the other hand is light years away on many issues. Switching sides is obviously a terrible decision for anyone who has any clue what's best for them.


So please, if you are one of the people who would refuse to vote for the democratic candidate if your choice doesn't get the nomination, I implore you to reconsider. The democratic party can not afford to fail in November, especially since it seems we really need the extra money for education that a democratic president would be able to procure by ending the war in Iraq (money that won't be there if McCain wins).

Much has been made about comments made by Wright and his relationship to Obama. There has been disturbingly few attempts to actually examine the issue. With just the sensationalist media stories out there a lot of voters have been swung towards Hillary according to exit polls. I want to clean up the whole debacle.

Firstly, soundbites are a real nuisance in today's media. Jeremiah Wright uttering the phrase "God damn America" has been played many times on TV, including in ads for Hillary. Never do you hear the entire sentence "God damn America for treating its citizens as less than human." His statement is suddenly much less inflammatory. In fact, when you consider things such as delaying aid to New Orleans and the conditions at Walter Reed, it is pretty darned hard to disagree with him.

Secondly, something that I absolutely never hear brought up is that Jeremiah Wright is connected to BOTH candidates. During Bill's impeachment over the Monica Lewinsky scandal, arguably the greatest political and personal turmoil in the Clintons' lives, it was the Reverend Jeremiah Wright who they personally invited to the White House for spiritual guidance.

So consider two things when you go to vote: one, that Jeremiah Wright is not the America hater that he's been made out to be; and two, that even if you disagree with that, he is still tied strongly to BOTH candidates and thus should be a non-factor in your decision anyway.