Why Obama cannot be trusted to make necessary economic reforms.
Just over one week ago, we learned that the US Treasury took control of the mortgage giants, Fannie Mae and Freddie Mac to keep them from going bankrupt. This week, Lehman Brothers went broke, Merrill Lynch was bought by Bank of America, and AIG, the country largest insurance company, was loaned billions of dollars by the treasury to keep it from going under. And although Barack Obama blames John McCain for failing to recognize the economic problems, he has not been honest with the public—and for good reason.
The so-called government enterprises, Fannie Mae and Freddie Mac have been run as private companies, but are guaranteed by the US taxpayers, a disastrous relationship by definition and design. They have both been cash cows for their top executives, but not for the taxpayers.
Clinton appointee, Franklin Raines made $90 million dollars during the few years he was the CEO, but was fired once it was discovered that he had overstated Fannie’s earnings by $10.8 billion. Former Obama aid, Jim Johnson took a $5 million-dollar-a-year salary from Fannie Mae, and was hired by Obama to vet his VP pool. Fannie has also been a reliable source of campaign contributions for Democrat and Republicans. Obama received the largest campaign contribution of any Congress member, $120,000, followed closely by Chris Dodd and John Kerry.
Fannie and Freddie have been used as a slush fund by unscrupulous Democrat politicians like Connecticut Senator Chris Dodd and North Dakota Senator Kent Conrad who are supposed to be providing oversight. The mortgage backers have been used to fund a number of liberal non-profits tied to them. To his credit, President Bush has tried many times to reform Freddie Mac and Fannie Mae, but has been blocked from doing so by the Democrats in both houses. And now we know why Fannie and Freddie shares plummeted.
In the first years of the Bush administration, the President touted that home ownership was at a historic high. This caused Democrat members of Congress to whine that there were not enough mortgages being given in “low income and minority communities.” So the rules were changed in order to give mortgages to people who were known to be unable to pay for them. In some cases, they were given sub-prime mortgages. And now, Congressional Democrats want to use even more federal tax dollars to keep those same people in houses that they should never have been given in the first place. Meanwhile, they continue spending money as if it was worthless—and before long, it will be.
In his so-called economic policy, Obama promises to give "middle-class taxpayers" a $1000 stimulus, adding to the already bloated national debt. And the tax increases he has planned will cost many thousands more, leaving you with a net loss. The media has been hiding this little "detail." In light of Obama’s incestuous relationship with Fannie Mae and Freddie Mac, does anyone really believe that he will do anything to reform them? And when is the media going to ask Obama to return the $120,000 in campaign cash to the taxpayers? Don’t hold your breath.