The Light: Hillary

Last month President Obama signed into law the Financial Regulatory Reform bill that left us Surrendering to the Worst.  But one of the very few positives of that bill was the formation of a consumer financial protection bureau to oversee some of the worst lending practices that contributed to the housing bubble and collapse.

The consumer protection bureau was the brainchild of Elizabeth Warren, a bankruptcy expert, consumer advocate and Harvard Law Professor who lobbied heavily for the creation of bureau.  So naturally, Ms. Warren seemed the obvious, as well as the ideal, person to head the new consumer protection bureau.

(Video by the Main Street Brigade in support of Elizabeth Warren candidacy for the Consumer Financial Protection Bureau directorship.)

Pressure mounts for ‘Sheriff’ Elizabeth Warren says Jennifer Liberto at CNN Money:

Last week, 43 House Democrats sent a letter to President Obama, asking him to nominate Warren and requesting a meeting at the White House to discuss Warren’s appointment.

“You have an opportunity to appoint to head this body a true visionary — not the usual Washington careerist. You have an opportunity to appoint to this body the single best-qualified choice,” said the letter, signed by Rep. Barney Frank, D-Mass., and Rep. Carolyn Maloney, D-N.Y., among others.

But Ms. Warren hasn’t exactly made friends with the powerful Banking community or the Treasury Department in her role as Chair of the Congressional Oversight Panel for TARP (Troubled Asset Relief Program).

(h/t Alain Sherter for this oldie, but goodie of Ms. Warren and Mr. Geithner)

From the moment the bill was signed into law the Obama administration was quick to point out Warren isn’t the only candidate for the director job.  And even some congressional allies began sounding like detractors.  Chris Dodd, chairman of the Senate Banking Committee warned Warren’s nomination could cause a protracted and lengthy battle in the Senate.  And he has repeatedly questioned whether Warren has the appropriate management skills to lead a large federal bureaucracy.

As Shahien Nasiripour at Huffington Post explains Dodd Questions Elizabeth Warren’s Management Experience — A Concern He’s Never Raised Before

… it’s the first time Chairman Dodd has publicly raised such an issue when it came to evaluating presidential nominees to agency positions under the banking committee’s purview.

A review of transcripts from past confirmation hearings shows that Dodd has never questioned the management experience of nominees to head federal agencies his committee oversees. The heads of the Securities and Exchange Commission, Department of Housing and Urban Development, Federal Housing Administration, the Export-Import Bank and the National Credit Union Administration all survived hearings under Dodd’s chairmanship without him once asking a question about the experience needed to guide their respective agencies.

Nor did Dodd raise any management questions when prospective bank regulators came before his committee — even when the regulators did not have significant management experience. In the two years prior to his assuming the chairmanship in 2007, the heads of the Federal Reserve, the Federal Deposit Insurance Corporation, Office of Thrift Supervision, Office of the Comptroller of the Currency, and a prior chief of the SEC all came before his committee. Each time, Dodd declined to ask about their experience running bureaucracies, a review of transcripts shows.

In fact, Dodd didn’t even show up for two of those hearings.

Two names that are bandied about to the director Michael Barr, a top lieutenant to Treasury Secretary Timothy Geithner, and Eugene Kimmelman, a top lawyer in the Justice Department.  But a third might win the prize.

In Obama & Frank: double dips and Washington exit strategies, Christopher Whalen:

It is becoming clear that the Obama Administration may not pick a candidate for the CFPB job until after the November election in order to dodge this very political issue.  By holding the voting on the new agency head until after the election, members of both parties will be able to extract maximum contributions from the banking lobby.  But I hear that the choice may have already been made.

It may surprise some observers that House Financial Services Committee Chairman Barney Frank may want the CFPB job for himself.  Frank reportedly has already expressed interest to the White House.  Sad to say, Chairman Frank probably has seniority over Chairman Warren.

“Barney did some heavy lifting,” says a source on the committee who is close to Frank.  “He might want a different gig, especially if he loses the chairman’s seat in November.  Frank would not want to hang around in Congress as part of the minority.  Being the first CFPB emperor, however, could be a more interesting gig than, say, eventually being made head of HUD of the FHA.”

Elizabeth Warren explains her problem with Congress’ response to protecting the American people during a radio interview in June ’10 with host Tom Ashbrook of On Point:

I got nothing when I walk into the room. You have to understand this. I don’t walk in with any votes, I don’t have any money to give. I just want to talk to people about what’s going on. And I think the part that is the hardest is sometimes I will talk to people in Congress – look, I think most of them, they didn’t go to Congress in order to lie, cheat, and steal. I think most of them went because they had some sense somewhere in their hearts at some point about public service. And I talk about what happens to middle class families and I watch faces, I watch eyes, connect on this, that say, “Yeah, I go back home, too.” And they name towns across America. And they say, “People are scared, people are worried, people are out of work. These are the things I hear in the grocery store, these are things I hear in the town hall meetings.”

TOM ASHBROOK: So what’s the counterweight then?

ELIZABETH WARREN: And then I say, “OK, look, here are three things we can do. But it’s about reining in an incredibly powerful industry. It’s about reining in a group that gives money and knows how to exercise power in Washington.” And I just watch the light go out, because it’s not going to happen.

Elizabeth Warren wants to protect the people.  But it’s the Bankers, not Ms. Warren or the American people, that have the money and the power to keep the lights on for Congress and President. So Congress knows who they need to protect first and foremost.  And its not the people.  Or Ms. Warren.

But why Barney Frank for the Director of the consumer financial protection bureau?

From Alain Sherter’s at BNet - Is Barney Frank After Elizabeth Warren’s Job Even Before She Has It?:

Frank, a fixture on Capitol Hill, knows how to cut deals with big business, as he showed in helping lead the fight over financial reform. It’s no accident that his leading financial contributor over his career is the American Bankers Association, followed by JPMorgan Chase (JPM).

So what are the odds of the Bankers getting what the Bankers want?

***

Oh, you remember Rep. Waters, don’t you? Who could forget her comments regarding Fannie Mae and Freddie Mac? Just in case, here’s a reminder:

Uh, um, hell yes, there was a big problem with Fannie Mae and Freddie Mac, Rep. Waters.

But wait, there’s more. Here is Rep. Waters revealing her true position on the government’s role in terms of Big Oil:

Okay, okay – I couldn’t resist that version. Too funny. Here is the real version:

Yes, all of that stuttering trying to cover up what she had just said is real. Yowzer.

Now, personally, I think Rep. Waters has demonstrated a complete and utter lack of integrity when it comes to financial issues, judging by her comments on Fannie and Freddie. So have Dodd and Frank, for that matter. That the latter two are the authors of a financial regulatory bill should give great pause to everyone.

So, it really should come as no surprise that now she wants to legislate quotas into the new Dood-Frank Financial Regulatory bill. Oh, how I wish I was kidding. According to this Daily Caller piece, that is exactly what Rep. Waters has done,
Racial Quotas in Dodd-Frank Financial Regulatory Bill:

The Dodd-Frank financial regulatory bill, ostensibly aimed at reforming Wall Street and preventing a future financial crisis, will impose racial and gender quotas on financial institutions if passed, according to economist Diana Furchtgott-Roth.

Section 342 of the bill will establish Offices of Minority and Women Inclusion in at least 20 federal financial services agencies. These offices will be tasked with implementing “standards and procedures to ensure, to the maximum extent possible, the fair inclusion and utilization of minorities, women, and minority-owned and women-owned businesses in all business and activities of the agency at all levels, including in procurement, insurance, and all types of contracts.”

So called “fair inclusion” will apply to “financial institutions, investment banking firms, mortgage banking firms, asset management firms, brokers, dealers, financial services entities, underwriters, accountants, investment consultants and providers of legal services.”

The provision goes on to assert that the government will terminate contracts with institutions they deem have “failed to make a good faith effort to include minorities and women in their workforce.” [snip]

Good grief. Quotas? Where does that leave “anti-discrimination” regulations, then? That question is answered here:

The provision goes on to assert that the government will terminate contracts with institutions they deem have “failed to make a good faith effort to include minorities and women in their workforce.”

Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor and senior fellow at the Hudson Institute, spotlighted the controversial section in an article at Real Clear Markets on June 8th. She told The Daily Caller that the law amounts to a quota system.

“This is a radical shift in employment legislation,” she said. “The law effectively changes the standard by which institutions are evaluated from anti-discrimination regulations to quotas. In order to be in compliance with the law these businesses will have to show that they have a certain percentage of women and a certain percentage of minorities.”

Furchtgott-Roth worries that this might be a harbinger of things to come.

“So what does this mean? Are we going to get rid of anti-discrimination laws all together and just put in quotas? Could this be what’s to come in other sectors?” she questioned. [snip]

Click HERE to read the rest.

Yes, I would say this is a huge departure from anti-discrimination regulations. That a quota system is being buried in this financial regulation shouldn’t really come as a surprise, I guess. But still, it does.

Wow. Has it really been less than two years since the Democrats controlled all three houses? Sure seems longer, especially considering all they have shoved down our throats. Er, I mean, “accomplished.”

And I guess if Rep. Waters gets her way, we’ll have another one shoved down our throats. Yep, pretty soon, quotas for everyone, coming to a business near you soon!! Good grief…

U.S. Rep. Barney Frank (D-MA)

Banks are increasingly healthy, right? Our nation’s accounting rules promote real transparency and integrity in our financial reporting, right? Housing is bottoming, right? No, no, and no!

Why so pessimistic, you may ask? I am not pessimistic at all. I am merely searching for the truth in the midst of the smoke and mirrors on Wall Street and in Washington.

Thank you to our friends at 12th Street Capital for sharing a recently released letter from Congressman Barney Frank imploring the four largest banks involved in mortgage originations to write off second liens they are holding on their books at inflated values.

Why does Congressman Frank believe these loans need to be written off? The liens must be largely written off so that Washington can then compel banks to engage in writing down principal on first liens in an attempt to keep people in their homes. Keeping people and families in homes is certainly a worthy cause, but the process is fraught with all kinds of violations of moral hazards and assorted unintended consequences. When you hear that your neighbor receives a principal reduction, how long will it take you to go to your bank and demand the same?

Let’s review Frank’s brief, two-page letter (click on image below to access pdf document). Focus on Frank’s comment that the second liens have no real value but accounting rules allow the banks to carry them at artificially high values. Can you say, “cooking the books”?

What are the projected losses in these second liens? Well, how much of this paper is outstanding? The Wall Street Journal provides a bar graph in an article, Home-Savings Moves Afoot:

So, with $1 trillion in outstanding second liens on the books, the question begs as to how much of this indebtedness is current, how much is delinquent, and how much is truly worthless but not yet acknowledged. In discussions with those in the industry, suffice it to say, the most optimistic assessment is that the industry has at least a few hundred billion in losses yet to be acknowledged.

The larger banks addressed by Congressman Frank are the largest holders of these second liens. These banks do have earnings power given the free flow of liquidity provided by the Fed and accompanying capital markets activities. That is not the case with smaller institutions. How many of those institutions are already dead, but not yet buried?

Wonder why banks are reluctant to provide credit? They need to increase capital knowing these second liens are truly an ongoing sinkhole.

LD

Like a voter scorned. Many of us are reaping the sweet rewards of, “I Told You So” with many of our Obot friends, family, and acquaintances. We did, we tried, we hoped, we cried, and nothing would sway them from the One True Messiah of Obama. Well, those days seem to be slipping away, don’t they? And one such supporter of Obama’s, who thought he was the cat’s meow, the one who would change politics as usual (I still do not, for the life of me, understand WHY people thought he would), has had it.

That would be Mort Zuckerman. If you are not familiar with the name, you surely are with the U.S. News and World Report, of which he is Editor-in-Chief, or the New York Daily News, which he owns (along with other properties). He is a gazillionaire (okay, just a billionaire), and he supported Obama in the 2008 Election. Now, he is just a tad put out as his Op-Ed, “He’s Done Everything Wrong,” indicates (h/t to Andy):

Obama punted on the economy and reversed the fortunes of the Democrats in 365 days.

He’s misjudged the character of the country in his whole approach. There’s the saying, “It’s the economy, stupid.” He didn’t get it. He was determined somehow or other to adopt a whole new agenda. He didn’t address the main issue.

This health-care plan is going to be a fiscal disaster for the country. Most of the country wanted to deal with costs, not expansion of coverage. This is going to raise costs dramatically.

In the campaign, he said he would change politics as usual. He did change them. It’s now worse than it was. I’ve now seen the kind of buying off of politicians that I’ve never seen before. It’s politically corrupt and it’s starting at the top. It’s revolting.

Holy moley! Bear in mind, this man, Mr. Zuckerman, was a SUPPORTER. I sure can’t disagree with his assessment, though. He continues:

Five states got deals on health care—one of them was Harry Reid’s. It is disgusting, just disgusting. I’ve never seen anything like it. The unions just got them to drop the tax on Cadillac plans in the health-care bill. It was pure union politics. They just went along with it. It’s a bizarre form of political corruption. It’s bribery. I suppose they could say, that’s the system. He was supposed to change it or try to change it.

Even that is not the worst part. He could have said, “I know. I promised these things, but let me try to do them one at a time.” You want to deal with health care? Fine. Issue No. 1 with health care was the cost. You know I think it was 37 percent or 33 who were worried about coverage. Fine, I wrote an editorial to this effect. Focus on cost-containment first. But he’s trying to boil the ocean, trying to do too much. This is not leadership.

Obama’s ability to connect with voters is what launched him. But what has surprised me is how he has failed to connect with the voters since he’s been in office. He’s had so much overexposure. You have to be selective. He was doing five Sunday shows. How many press conferences? And now people stop listening to him. The fact is he had 49.5 million listeners to first speech on the economy. On Medicare, he had 24 million. He’s lost his audience. He has not rallied public opinion. He has plunged in the polls more than any other political figure since we’ve been using polls. He’s done everything wrong. Well, not everything, but the major things.

I don’t consider it a triumph. I consider it a disaster.

You and me both, Mr. Zuckerman. But if I may be so bold, perhaps lofty words are not a prerequisite for the highest office in the land. Just saying. Perhaps you should have looked a little deeper into how much Obama enjoyed the adoring masses, buying the PR spin that he was The One. The problem is, he started to believe it. He believed/believes it really is all about him. But, as a truly great president said, “I feel your pain.”

And speaking of Clinton:

One business leader said to me, “In the Clinton administration, the policy people were at the center, and the political people were on the sideline. In the Obama administration, the political people are at the center, and the policy people are on the sidelines.”

Again, YES. I hate to keep harping on this, but why were you not capable of seeing this BEFORE?? When Obama regurgitated Deval Patrick’s speeches, that should have been a clue that it was absolutely NOT about policy, but all about politics. When he continually took Hillary Clinton’s policy positions for his own, instead of crafting them himself, that should have been a bit of a clue. But no. Zuckerman, and to many like him, failed to see what was right before their eyes. They believed the hype, too:

I’m very disappointed. We endorsed him. I voted for him. I supported him publicly and privately.

I hope there are changes. I think he’s already laid in huge problems for the country. The fiscal program was a disaster. You have to get the money as quickly as possible into the economy. They didn’t do that. By end of the first year, only one-third of the money was spent. Why is that?

He should have jammed a stimulus plan into Congress and said, “This is it. No changes. Don’t give me that bullshit. We have a national emergency.” Instead they turned it over to Harry Reid and Nancy Pelosi who can run circles around him.

It’s very sad. It’s really sad.

He’s improved America’s image in the world. He absolutely did. But you have to translate that into something. Let me tell you what a major leader said to me recently. “We are convinced,” he said, “that he is not strong enough to confront his enemy. We are concerned,” he said “that he is not strong to support his friends.”

The political leadership of the world is very, very dismayed. He better turn it around. The Democrats are going to get killed in this election. Jesus, looks what’s happening in Massachusetts.

Well, for a moment, perhaps, but even in other countries, people are waking up (check out The Telegraph, or Der Spiegel sometime). But here’s the thing: by caring more about appearances than policy, being liked more than fixing problems, Obama, and all who voted for him, have done this country a tremendous disservice. We told you it wasn’t American Idol for which he was running, but the presidency.

There is still some delusion, though:

It’s really interesting because he had brilliant, brilliant political instincts during the campaign. I don’t know what has happened to them. His appointments present somebody who has a lot to learn about how government works. He better get some very talented businesspeople who know how to implement things. It’s unbelievable. Everybody says so. You can’t believe how dismayed people are. That’s why he’s plunging in the polls.

I can’t predict things two years from now, but if he continues on the downward spiral he is on, he won’t be reelected. In the meantime, the Democrats have recreated the Republican Party. And when I say Democrats, I mean the Obama administration. In the generic vote, the Democrats were ahead something like 52 to 30. They are now behind the Republicans 48 to 44 in the last poll. Nobody has ever seen anything that dramatic.

Did you mention by how much Obama has run up the National Debt? You know, the one he has increased by $1.7 TRILLION since he took office? And he’s looking to increase it by even more. Oh, yippee.

If I may return to another part of Mr. Zuckerman’s editorial, no offense, sir, but OBAMA didn’t have “brilliant, brilliant political instincts during the campaign,” his HANDLERS, Axelrod and Plouffe. did. Had you taken just a few minutes and used the considerable resources at your disposal, you could have looked into his REAL record in IL. You would have seen the shenanigans he employed to even get elected. Now, maybe YOU think that is “brilliant,” but I see it as being an indicator of the man’s moral fiber, and his “win at all costs,” mentality, no matter who he steps on, or what kind of damage he does. Perhaps what Zuckerman is seeing now, is the failure of Axelrod and Plouffe to pull the man off the Campaign Trail and him getting to work. Obama still hasn’t stopped, as he heads off to Ohio on Friday.

Still, at least he is finally getting is. In this interview with Neil Cavuto (h/t to Logistics Monster), he can barely contain himself:

Mr. Zuckerman made some mighty interesting assertions in there, didn’t he, especially in terms of housing? Welcome to the reality based community, sir.

Indeed, slowly but surely, the Kool Aide is wearing off, but not until Obama has done untold damage to out country – IN ONE YEAR. Will he be able to turn it around? I don’t know, but that would presuppose he was capable of introspection, and a willingness to actually listen to the people, as opposed to talk, talk, talking to us (though apparently, he hasn’t talked at us enough – we just don’t get it, you know – because apparently, we are all a bunch of mo-rons not to buy his healthcare bill). Just a thought.

In the meantime, maybe we have all learned a lesson after this presidential election, and after the Massachusetts election. People can be hoodwinked, but not forever. When they wake up, they are none too happy at the lies they were told. That’s why we have elections, and this year is shaping up to be mighty interesting indeed…

* Bumped up (Amy discusses Lynn de Rothschild’s article, one of the hottest stories circulating on the ‘net) *

Well, it’s official: Scott Brown won the US Senate seat in Massachusetts, easily one of the most liberal states in the Union. Brown’s win is the first by a Republican in that state since 1972. Holy moley. Time and time again, people claimed the Healthcare Bill the Democrats are trying to ram through as the reason they voted for Scott Brown. If this isn’t a wake up call to the Democrats, I don’t know what is.

And yet, there are people like Speaker of the House, Nancy Pelosi, who seems completely oblivious to the massive alarm bells ringing throughout the country. One would think this would filter into her, but apparently no:

“The reports of its death, as Mark Twain would say, have been exaggerated,” Larson added. “We’re going to move forward, and we’re going to pass health care reform.”

This afternoon, House Speaker Nancy Pelosi said much the same. “Whatever happens in Massachusetts, we have to do that,” she said. “And whatever happens in Massachusetts we will have quality affordable health care for all Americans, and it will be soon.”

Oh, boy. Add to that the ramped up call for the “Reconciliation Option,” including by the organization, Credo, which sent out an email immediately following the declaration of Brown’s win asking people to sign this petition:

Your message to President Obama, Speaker Pelosi and Senate Majority Leader Harry Reid:

“The loss of Ted Kennedy’s seat — due to a lack of enthusiasm among Democrats and Independents — sends a clear message to Congress. The Senate health care bill is not the change we were promised in 2008, and it must be improved. The Senate must use ‘reconciliation’ to pass a better bill with a strong public option.”

In case you don’t know what “reconciliation” means, they are suggesting the Democrats use a 51 majority vote to shove through this bill with its payoffs, bribes, and strong-arming. I might add, this tactic was designed for use with BUDGET bills. Clearly, Credo didn’t like the message Massachusetts sent, and believes it is a better idea for the Democrats to inflame passions against this bill even MORE by using a filibuster-proof tactic. Nice.

Make no mistake, the Democrats are trying mighty hard to figure out how to get this bill through regardless of what the people say. I mean, really – it’s not like it’s their JOB or anything to care, right? Ahem.

On the other side, though, one of my favorite Democratic senators (and one I have supported), is Sen. Jim Webb of VA. This was his immediate response to Scott Brown’s win:

Less than 15 minutes after the race was called for Republican Scott Brown, the first of what could be many conservative Democrats asks for leadership to put the brakes on health care reform.

Sen. Jim Webb (D-VA) congratulated Brown on his win and delivered a zinger:

“In many ways the campaign in Massachusetts became a referendum not only on health care reform but also on the openness and integrity of our government process. It is vital that we restore the respect of the American people in our system of government and in our leaders. To that end, I believe it would only be fair and prudent that we suspend further votes on health care legislation until Senator-elect Brown is seated.”

That is more like it. He is hearing the message the people are sending, and wants to take a step back here, and look again at this bill.

But Senator Webb is not the only one. You may be a bit surprised by this, but Rep. Barney Frank (D-MA), of all people, warns against changing horses in mid-stream (of course, my cynical side says he is a bit worried about his seat in the future, too):

“I have two reactions to the election in Massachusetts. One, I am disappointed. Two, I feel strongly that the Democratic majority in Congress must respect the process and make no effort to bypass the electoral results. If Martha Coakley had won, I believe we could have worked out a reasonable compromise between the House and Senate health care bills. But since Scott Brown has won and the Republicans now have 41 votes in the Senate, that approach is no longer appropriate. I am hopeful that some Republican Senators will be willing to discuss a revised version of health care reform because I do not think that the country would be well-served by the health care status quo. But our respect for democratic procedures must rule out any effort to pass a health care bill as if the Massachusetts election had not happened. Going forward, I hope there will be a serious effort to change the Senate rule which means that 59 votes are not enough to pass major legislation, but those are the rules by which the health care bill was considered, and it would be wrong to change them in the middle of the process.”

Gee, ya think?? You know, it is amazing what it takes to actually get through to these people. Maybe if this doesn’t hammer it home, this great piece by Lady Lynn Forester de Rothschild will:

The problem for the Democrats in Massachusetts was not Martha Coakley; it was the Obama agenda. In 2008, voters believed that they were electing a person who would focus on the economy with laser intensity and lead in a bipartisan and principled matter. What they have gotten is a deeply divisive President committed to transforming America into a European-style social democracy. In this first year, he forced a health care bill at the expense of vitally needed focus on job creation. He has scared hard-working American voters with his hard-left rhetoric and his signature policies.

The Obama approach to health care reform is the most egregious example of breaking trust with the American people. He brokered no Republican compromise; he demonized the other side for being captive to vested interests as he made private deals with Democratic special interest groups like the unions, the insurance companies and “hold-out” Senators like Ben Nelson (who was just looking for his pound of flesh at the expense of the rest of the American people); he outsourced the bill to Nancy Pelosi and Harry Reid behind closed doors as he focused only on taking the victory lap for pathetic, piecemeal legislation that does not deal with our exorbitant health care costs. Have no doubt, the speech trumpeting “his” historic achievement, where other less talented Presidents than himself have failed, is already loaded on the teleprompter.

These are major negative factors for the independent voters who believed that Barack Obama was a principled and moderate Democrat. This is particularly true in Massachusetts where the nation’s only universal health care plan is bankrupting the state because of politicians’ congenital inability to deal with spiraling costs. In Massachusetts, a full 47% of voters are Independents, with 33% Democrat and only 11% Republican. For many of these voters, Barack Obama is now a busted flush; he was full of promise but has neither delivered on that promise nor exhibited the capability to deliver. He has broken the trust of the people, and voters are taking the only action available to them: Electing a candidate who can stop the Obama agenda and help restore balance to a broken political system. The voters in the Bay State are resorting to the principle that our Founding Fathers made famous: checks and balances. It is unlikely that all voters overwhelmingly support Republican State Senator Scott Brown, but it is certain that they see him as a vital player in forcing Barack Obama to come back to the center.

Preach it, Sister Lynn! Bring it on home:

This is important to keep in mind in reviewing Tuesday’s results. Equally important is to reject the demonization of Coakley that is being perpetrated by the Obama White House and the Pelosi/Reid Congress. Coakley’s troubles were never about her as a candidate; she has won state-wide elections before and few would argue she is more removed than John Kerry. Her problem was simply about the President and the radical course being charted by Democrats in Congress. A year after his inauguration — and three years since Democrats regained Congress — voters were holding Obama accountable. This simple fact makes scapegoating Coakley unconscionable, and yet this week all knives are out from the Obama White House. Coakley was insufficiently charismatic, leading Democrats are saying; she did not have an emotional connection to the voters. She did not work hard enough. She was more a “nun” than a political candidate!

This is all nonsense of course, but not surprising. After all, it’s not the first time the current crop of Democratic party leaders have torn down a talented woman in their midst.

That Hillary Clinton won Massachusetts by a resounding sixteen points in 2008 is not unrelated. While Massachusetts may be bluest of the blue, it’s a state where working class liberalism still runs deep, where an honest day’s work is still held in higher esteem than entitlement handouts. When Hillary ran on these principles, Massachusetts voters embraced her. And for this same reason, on Tuesday they embraced Scott Brown.

Obama’s team may want to make the election about Martha Coakley, but it’s not about her. As rank-and-file Democrats try to make Martha Coakley the issue and engage in her assassination, they miss the fact that they are in a circular firing squad. Their problem is that they are out of touch, and their boosters in the media cannot save them.

Voters this week stood up and said ‘enough is enough.’ It’s high time Obama and the Democrats in Congress got the message.

Amen to that. And if they don’t get it after this, there is always November…

*Updated: Ohmygosh – now Barney Frank has done a COMPLETE 180, saying he could vote for the Senate bill now. WTH is wrong with this guy? And who got to him? Wow, he is a piece of work. Way to stick to your guns there, Barney! Yeah. Right.

Second Update: well, Nancy must have heard an earful from the other representatives. Now she says the House has to make changes to the Senate’s bill:

Pelosi (D-Calif.) has been struggling for days to sell the Senate legislation to reluctant Democrats in order to get a health-care bill to the president’s desk quickly. But House liberals strongly dislike the Senate version, while moderate Democrats in both the House and Senate have raised doubts about forging ahead with the ambitious legislation without bipartisan support.

The only way to keep the Senate bill alive, Pelosi said, would be for senators to initiate a package of fixes that would address House concerns about the bill. In particular, Pelosi described her members as vehemently opposed to a provision that benefits only Nebraska’s Medicaid system. Also problematic are the level of federal subsidies the Senate would offer to uninsured individuals and its new excise tax on high-value policies, which could hit union households.

“There are certain things the members simply cannot support,” Pelosi said.

Like I said, I guess the representatives let her have it. It will sure be interesting to see what happens next.

If you wonder why America is broke, look no further than the individual who wanted to roll the dice on sub-prime lending, that is the Democrat from The People’s Republic of Massachusetts, Barney Frank. In an interview on CNBC, Frank as much admits that maybe sub-prime lending should have been more regulated. Wow! What balls!

America doesn’t need legislators who operate by looking in the rear view mirror. With the sole exception of Frank’s remark in support of auditing the Fed, he offers platitudes that can only be compared to a social misfit. In fact, as I watched this clip, I constantly envisioned Barney collecting tickets and serving soda at a local theatre . . . said with all due respect to ticket takers and soda jerks.

For Barney Frank to effectively absolve himself of the massive and corrupt bankrupting of Freddie Mac and Fannie Mae is a sin. For America not to hold him accountable is a greater sin.

This clip runs 18 minutes. WARNING: Barf bags highly recommended!

LD

Blank checks are the antithesis of good public policy.

America can not allow the passage of time to lessen the outrage over the Obama administration’s Christmas Eve bonus to the financial sinkholes known as Freddie Mac and Fannie Mae. Platitudes and posturing aside, the American taxpayer is being set up as never before.

A blank check may serve to cover a host of past financial and legislative failures promoted by the likes of Barney Frank, Chris Dodd, John Kerry et al, but who is monitoring and verifying the legitimate and proper use of these funds? Are we to blindly trust Treasury Secretary Geithner, White House economic adviser Larry Summers, and their respective staffs in this process? Are you kidding me? America needs to voice its outrage long and hard. In that spirit, I called yesterday to Audit Freddie and Fannie.

In the same vein, I am heartened by initiatives launched this week by Rep. Dennis Kucinich (D-OH), and Reps. Scott Garrett (R-NJ) and Spencer Bachus (R-AL) to pursue an investigation of this blank check.

The Wall Street Journal reports, Lawmakers Want Probe Into Treasury Aid for Fannie, Freddie:

The Treasury Department’s surprise Christmas Eve move to uncap the potential aid to Fannie Mae and Freddie Mac should be investigated, lawmakers from both political parties said Wednesday.

Rep. Dennis Kucinich (D., Ohio) said his congressional subcommittee plans to investigate Treasury’s decision to lift the existing $400 billion cap on government cash available to the two firms. Separately, Reps. Scott Garrett (R., N.J.) and Spencer Bachus (R., Ala.) called for the House Financial Services Committee to hold a hearing on the matter.

Mr. Kucinich, who chairs the domestic policy subcommittee on the House Oversight and Government Reform panel, said he is concerned about how the two government-controlled firms will use their new flexibility.

“This cannot be used simply to purchase toxic assets at inflated prices, thus transferring the losses to the U.S. taxpayers and acting as a back door [Troubled Asset Relief Program],” Mr. Kucinich said in a statement released by his office.

Messrs. Garrett and Bachus raised similar concerns in a letter to Rep. Barney Frank (D., Mass.), who chairs the Financial Services panel. The two GOP panel members decried what they called a “transparent attempt to hide the news from the American people” by announcing the news the day before a major holiday.

I am not only concerned about Geithner’s and Summer’s influence over the allocation of the funds behind this blank check, but I am equally concerned because of the influence of that individual to whom Garrett and Bachus directed their letter. Barney Frank (D-MA), Chair of the House Financial Services committee, has always been in bed with Freddie and Fannie. I do not doubt for a second that Frank would use this blank check to cover his misguided policies and misappropriated funds supporting Freddie and Fannie over the years.

Need I remind you of Frank’s “I want to roll the dice…” comment in regard to Freddie and Fannie’s support of sub-prime lending in 2003?

America can not allow time and other issues to distract us from what may very well be the single largest misallocation and misappropriation of taxpayer funds in the history of this country.

Trust Geithner? Trust Summers? Trust Frank?

Put Sense on Cents in the verify camp!!

How about you?

LD

Despite overwhelming efforts on the part of Uncle Sam, the simple fact of the matter is the program to successfully and permanently modify mortgages has not gained truly meaningful traction. Public pressure on mortgage servicers specifically and the mortgage modification program at large have generated a slight, but hardly significant, increase in permanent modifications over the last month. Let’s review the statistics provided by Uncle Sam’s Making Home Affordable Program:

Home Affordable Modification Program (HAMP) Snapshot through November 2009

HAMP Trial Plans Offered to Borrowers

Making Home Affordable Program Servicer Performance Report Through November 2009

Number of Requests for Financial Information Sent to Borrowers (Cumulative): 3,137,548

Number of Trial Period Plan Offers Extended to Borrowers (Cumulative): 1,032,837

All HAMP Trials Started Since Program Inception: 759,058

All Active Modifications (Trial and Permanent): 728,408

Number of Active Trial Modifications: 697,026

Number of Permanent Modifications: 31,382

What does that 31,382 figure under the permanent modifications represent? 4% of all active modifications and 1% of those who have been solicited. At this rate, we will be waiting a LONG time for this program to have a meaningful impact on our housing market.

Where is this leading? Mortgage cram-downs. Reps. John Conyers and Barney Frank are starting to wave the cram-down flag once again. For those unfamiliar with a mortgage cram-down, it is the practice of reducing principal on the mortgage. In the process, the homeowner will be less underwater or not underwater at all and thus choose to stay in his home. Given the fact that there is no free lunch, taxpayers pick up the tab along with investors who have purchased mortgage securities backed by these mortgages.

Expect a massive fight over the implementation of mortgage cram-downs in 2010.

Thanks to our friends at 12th Street Capital for sharing the link to the Making Home Affordable Program.

LD

Related Sense on Cents Commentary:
   What is a Mortgage Cram Down? (January 1, 2009)

Well, it being Halloween and everything, I thought about doing some snarky kind of post about politicians who are particularly scary, like Nancy Pelosi, or Barney Frank. But then I thought, “Why ruin a perfectly nice holiday?” Ahem.

So - for your enjoyment, I have the following photographs, sent to me by my cousin, who got them heaven-only-knows-where (somewhere on the internet). The headline of the emails was, “When Farm Kids Get Bored,” and who happen to be a bit creative (who knows if these were even done by kids?). Anyway, for your Halloween Viewing Pleasure, here they are:

I hope you have a good, safe, day. Happy Halloween, everyone!

Well, it’s about damn time - again. Yes, Rep. Conyers has finally been persuaded - again - to investigate ACORN. Oh, yes, all the recent brouhaha about ACORN, all of the exposure from the faux pimp and prostitute, have FINALLY gotten the House Judiciary Chairman to get off his duff, and investigate ACORN, as this article highlights (the US Census Bureau and the IRS have cut ties with ACORN), Conyers Seeks Answers On ACORN:

House Judiciary Chairman John Conyers – a Detroit Democrat – is weighing into the controversy involving a much-maligned national community organization, asking congressional researchers whether any laws may have been broken by surreptitious recording of the group’s employees.

Just last week, the Democratic-led House followed up on a Senate vote that started cutting off federal funding for the Association of Community Organizations for Reform Now, or ACORN, amid Republican-led calls for a widespread investigation into the group and its activities.

Even President Barack Obama has criticized the actions of ACORN employees in Baltimore, Washington, D.C., and elsewhere seen in sting videos. The employees appear to give tax advice to filmmakers pretending to be a hooker and her boyfriend. (Well, kinda - he said it wad “inappropriate. See video/transcript below.)

Conyers and House Financial Services Chairman Barney Frank of Massachusetts asked the nonpartisan Congressional Research Service on Tuesday to provide an analysis on several aspects of ACORN. Among them:

# Any current or previous criminal investigations into the group.

# A breakdown of any funding received by the group and any violations of the terms of that funding.

# A report on alleged improprieties in collecting voter-registration forms and “the extent … that resulted in people being improperly placed on voting roles and actually attempting to vote.”

# The group’s programs to provide housing opportunities.

It also asked for a report on private sting activities “in which individuals have reportedly visited ACORN offices, misrepresented their identities and proposed activities, surreptitiously videotaped resulting conversations with ACORN workers, and widely distributed them.”

The letter went onto say, “Conflicting allegations have been made about the propriety of these activities. Please research and report on the federal and state laws that could apply to such videotaping and distribution of conversations without the consent of all parties.”

I’m sure they’ll get right on that.

Why the disdain dropping from my laptop? Because this isn’t the FIRST time Rep. Conyers was going to investigate ACORN. Previously, he had been pretty disturbed by the actions of ACORN, or so he claimed (this is a good article to see more of the underhanded workings of ACORN). Remember that they have been under investigation in over 14 states for voter fraud and voter registration fraud for some time now. The recent expose is just the icing on the cake. But the disdain comes for the REASON Conyers dropped it: The “Powers That Be” put an end to it. Yes, you read that right: THE POWERS THAT BE told the House Judiciary Chairman to knock it off.

Hmm. Let’s think. Just who is high enough to tell this powerful chairman to drop his investigation? It’s a pretty short list, I can tell you that much,

But, hey - better late than never, right? Yeah. Sure.

And I just KNOW once Obama has a spare moment, you know, when he’s not on The David Letterman Show, or something, maybe he will finally have a chance to follow what’s going on with ACORN, since he claimed to be out of the loop despite the millions ACORN has gotten, or the billions it stands to get. Yes, this is what he said in his recent interview with George Stephanopoulos:

STEPHANOPOULOS: How about the funding for ACORN?

OBAMA: You know, if — frankly, it’s not really something I’ve followed closely. I didn’t even know that ACORN was getting a whole lot of federal money.

STEPHANOPOULOS: Both the Senate and the House have voted to cut it off.

OBAMA: You know, what I know is, is that what I saw on that video was certainly inappropriate and deserves to be investigated.

STEPHANOPOULOS: So you’re not committing to — to cut off the federal funding?

OBAMA: George, this is not the biggest issue facing the country. It’s not something I’m paying a lot of attention to.

Or you can watch it here:

That Obama - he’s just so busy doing the talk show circuit, he couldn’t POSSIBLY know what is going on with ACORN. I mean, really, besides his having worked for them, and all of that, what possible connection could he have with them?

Oh, wait - he does. Right in the West Wing. Uh huh - his Rove, the Director of the Office of Political Affairs, is Patrick Gaspard. Mr. Gaspard, before moving into the West Wing, was the Executive Vice President of - Wait For It - SEIU. SEIU was founded by Dale Rathke, the brother who embezzled a million bucks from ACORN. Which they hid, by the way. Whatever. Just a million of your tax paying dollars, no biggie.

And Patrick has a brother, Michael, who works for the Advance Group. Which represents - like you need to wait for it - ACORN. Coincidentally (hahahahaha), the national spokesman for The Advance Group, and ACORN, is one in the same, Scott Levenson.

I gotta wonder, how long will it be before Conyers is called off of THIS investigation?

(Photo above bymusicFIRSTCoalition)