Monday, March 29, 2010

Dowd: The Church Needs A Nope!

Healthcare Noise

The GOP already has signaled its intent to wage a guerilla warfare campaign against the healthcare legislation which President Obama signed into law and those who voted for it.

Reports of physical and property threats against Democrats and their families has gone up and frustrated “Tea Party members,” running out of racial and sexual barbs are being challenged by the Republicans to upgrade their opposition as we cruise toward November. Great by me; that’s participatory democracy and should be encouraged, as long as it’s legal and civil.

Thirteen state Attorneys General filed suit in a federal court in Pensacola, Florida, minutes after Obama signed the Patient Protection and Affordable Care Act. The complaint calls the act an "unprecedented encroachment on the sovereignty of the states" and asks a judge to block its enforcement.

"The Constitution nowhere authorizes the United States to mandate, either directly or under threat of penalty, that all citizens and legal residents have qualifying health care coverage," the lawsuit states

The suit was filed by Florida’s AG, former Congressman and House Banking Committee member Bill McCollum and his fellows (including one Democrat).

I love these states rights guys. But where were they in 2000, when Floridians gave their individual and electoral votes to Albert Gore, apparently putting him over the top and making President of the United States?

The Rightists, then, copped the opposite side and asked a GOP dominated US Supreme Court to step in trample the rights of Florida voters and give the presidency to the Florida Governor’s brother. “Please trample this state’s rights,” they effectively wailed.

What a carnage of justice that was and what a resulting 8 year blow to the American people, our economy, international status, and aspirations—and that was before George W. Bush and his team lied to the American people and started a costly, questionable and useless war against Iraq.

How about those states rights’ apples?

Forgive me if I don’t get too excited over political losers crying over spilled milk. Even our right handed Supreme Court will have trouble overturning this act of Congress.

To the D’s

Why be in the majority if you can’t write legislation and policy the way you campaigned? Any Democrat worried about re-election because of his/her healthcare vote or any other past vote doesn’t deserve congressional office.

If you are so squirrelly that you begin to run when the political opposition makes loud scary noises or glassware starts breaking then you need to get into another line of business.

That’s like being a 40 year old virgin. It makes no sense!

Republicans will attack Democrats for their votes, no matter what else happens, so D’s should walk a thoughtful victory walk and light the victory cigar, at least until the “Fat Lady sings” in November, again.

Strut smartly D’s, don’t mince!

Former House Democratic Majority Leader Tony Coelho offered Democrats running in November this advice:

Democratic candidates must make this a debate about the bill’s individual components. Where does your opponent stand? Does he or she want to repeal the reform?
What exactly do Republicans plan on taking away from the American people?
Will they tell small-business owners in their districts that tax credits to provide health care for their employees will be repealed? Are they going to ask senior citizens to give back rebates for prescriptions not covered under Medicare? Will the Republicans throw the young people in their district to the wolves and take away their coverage? Will they tell those who were uninsured or denied coverage because of pre-existing conditions before this reform law passed that they are taking away their new coverage?
Democrats should seize the moment: Go to your base. Be proud of what you have done and tell your constituents what is in the bill. Don’t let your opponent frame the debate.

Fannie and Freddie and the “Truth Teller”

Having watched too many congressional hearings—exposing myself to 10 times the amount of bloviation (I love the word!) the average mind can tolerate--has generated in me a fantasy where I am in the hearing room and play the role of “Truth Teller.”

The TT really doesn’t exist. But it’s my dream and I play him/her, with license to comment on anything I hear which is fatuous, filled with misstatement or ironic enough to demand a response.

My dream role is a role any real Congressman/Senator can play, right now, if he or she is well informed. But so few congressional participants have the facts that they never seem to correct the erroneous/ironic statement which would cause my “Truth Teller” to spring into action.

Flash last week to the first day of House hearings chaired by Barney Frank (D-Mass) to “abolish” Fannie Mae and Freddie Mac.

Treasury Secretary Tim Geithner was committee’s the first witness (but not the best, as I will reveal in a moment). He delivered thoughtful testimony about the future mortgage finance and the GSEs.

Geithner reaffirmed many of the important mortgage finance systemic qualities which I’ve been writing about and he pledged the Obama Administration to hold on to what worked for the GSEs and the country and discard what didn’t, starting with ready availability of the 30 year fixed rate mortgage (which alone will insure Fannie/Freddie like qualities to whatever succeeds them), access to mortgage finance for those with modest incomes, efficiency, competition, and private capital.

While there were many opportunities for my imaginary TT that first day. But for me, Texas R Jeb Hensearling reached the height of pomposity, arrogance, patronization, and idiocy.

The seldom brilliant GOP Rep. Hensearling offered his disdainful two cents worth, questioning Geithner, and commented:

"Of all the dumb regulation and legislation that caused our economic crisis, none was dumber than that which created the [Fannie and Freddie] monopolies and gave them ever-increasing affordable-housing missions," said Rep. Jeb Hensarling (R-Tex.).
OK, “Truth Teller” do your thing!

“ Congressman Jeb. You don’t know me, but I am the “Truth Teller” and you’re in my congressional hearing fantasy. Let me, answer your implicit question. The modern Fannie Mae and Freddie Mac—with their annual national low-mod housing goals responsibilities—were created in 1992, under the Reagan Administration.

“For 24 years, those same structures and responsibilities were affirmed by several congresses and Presidents George H.W. Bush, Bill Clinton, and George W. Bush, until the companies were put into conservatorship by Treasury Secretary Hank Paulson in 2008. (Read Paulson’s recent book, where I think he claims the Russians told him to do that number.)

“Many of those years saw the GOP controlling both the Congress and the Administration, but neither company was “abolished.”—far from it—they were enhanced, encouraged, and given bigger low-mod numbers to hit, as well as fewer tools to do so. Those facts suggest that the former GSEs housing goals, operations and growth, pre-Paulson, has Republican DNA all over them. Ergo, the answer to your question Jeb--with all due respect to Walt Kelly and Pogo--is that the “enemy is us,” meaning you and yours!

“Oh, and TT thinks you’re a fatuous blowhard, who bloviates!”

(I love the TT’s job!)

The five person panel following Geithner and representing trade associations, a conservative think tank, and low income interests had one extremely insightful statement, which I hope is carefully reviewed by committee members and their staffs.

That “prize” came from Sarah Rosen Wartell, Executive Vice President, the Center for American Progress, who discussed a recent 18 month Mortgage finance system study her group sponsored. She went through the Fannie/Freddie working model and described how the firms’ aberrant management business decisions in 2006 and 2007—specifically the purchase billions of dollars of Wall Street originated and guaranteed “private label mortgage backed securities” (PLS)--were the phenomenon which tanked Fannie and Freddie, not their structure or their affordable housing missions.

That fact alone—if internalized by the Committee and its staff—will be a great guide to their work.

The Mortgage Bankers Association testimony also stands out, but for its hoariness or I should say “whoriness!”

The MBA, all but a lame subsidiary of the American Bankers Association, offered a self-congratulatory litany of the work they’ve done on this “issue” and then proceeded to say how much private capital was needed in the market. Good point, but, what was their primary request? Their witness sought a new set of federal government mortgage guarantees to make it easier for mortgage companies. That ain’t “private capital,” guys.

Where was Rep. Hensearling, when needed, urging the myopic MBA to, “Just say goodnight Gracie?”

Short Shots

--Remember my “don’t trust the Russians” advice? Putin and Medvedev needed a nuclear arms deal more than the US did, but it seems we gave them budget relief and more on a silver platter, seemingly without getting any concessions re their behavior on Iran and other matters crucial to the US. When will we learn?

--Sen. Chris Dodd (D-Conn) surprised me with his strategy and his success moving a financial regulatory reform package. I thought Dick Shelby (R-Ala.) fighting his own internecine war with Bob Corker (R-KY.) would never let a bill out committee. Most of Shelby’s influence now could be lost.

Now on the outside looking in, no matter what he claims, Shelby is “depending on the kindness of strangers” or at least strange bedfellows.

Say “Goodnight Blanche!”

--I’ll largely leave the Pope and the Catholic Church alone this week; as more details come out about what the Pope as Cardinal Ratzinger did or didn’t do, when he was head of the Church’s “Congregation for the Doctrine of the Faith” (which dealt with pedophile priests). The Church seems to be drowning in their explanations and excuses of the Pope’s tenure in that job.
(Wrote the above before seeing Sinead O’Connor’s column in yesterday’s Post “Outlook” section and Maureen Dowd’s NYT column. Both highly recommended.)


Maloni, 3-29-2010


John M said...

If you're into irony (parts of this are prescient, much definitely not) you and your readers might enjoy this classic piece where I "congratulated" the GSEs on keeping their books' quality up. Oops! "Safety Net V: Wallflowers at the Alt-A dance" (Aug 14, '06)

My fantasy was that you'd have turned up at Geithner's address at AEI a week ago today, which included this interesting bit from around 31 minutes on the tape:

"And as I said, there were very consequential and they were a basic simple failure, which is, if you allow firms to build up leverage on the expectation the government will be there to bail them out, then you'll deal with, you'll face a huge consequential mess. And people let it happen without acting, and those who tried to act, including government officials, were prevented from acting by a formidably powerful and effective group of financial lobbyists, often arguing that the interests of Fannie and Freddie were identical, inseparable, from the interests of the consumer, or the homeowner."

It would have been priceless to see the look on his face if you'd announced your (former) affiliation before questioning that one ;-)

Now I think that 30-year fixed is actually the main root of the problem and that Canada's lucky escape (so far) owes much to a quirk in our banking laws that effectively cuts mortgages off at 5-year. In America's case, there seems to be no way to keep the sacred conforming 30-year mortgage without continuing make the conservatorshipped GSEs' books continue to expand without limit. How can that end well?

Bill Maloni said...

Factual Error, my BAD!!
While early discussions of the Fannie/Freddie legislation--which became law in 1992--began when Ronald Reagan was President. It reached fruition and was signed by the first President Bush, George H.W. Bush.

Anonymous said...

Hey there Bill,

My name is Luke Mullins and I am a reporter working on a story about the housing crisis for Washingtonian magazine. I was hoping to chat with you but I can't seem to locate any contact information. Would you, by chance, be able to give me a call at 202-955-2082? Thanks and I look forward to hearing from you. Luke