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Below are the two final essays to be posted on Allegiance and Duty Betrayed. The first one is written by a friend -- screen name 'Euro-American Scum' -- who, over the past four years, has been the most faithful essayist here. He has written about everything from his pilgrimage to Normandy in 2004 to take part in the 60th–year commemoration of the invasion, to his memories of his tour in Vietnam. His dedication to America’s founding principles ... and those who have sacrificed to preserve them over the past 200+ years ... is unequaled. Thank you, E-A-S. It has been a privilege to include your writing here, and it is a privilege to call you my friend.

The second essay is my own farewell. And with it I thank all of the many regular visitors, and those who may have only dropped in occasionally, for coming here. I hope you learned something. I hope a seed or two was planted. But, even if not, I thank you for stopping by ... 25 March, 2010


President Bush's 9/24/08 Address to the Nation


The following may not prove to be one of my better-written commentaries, for two reasons: (1) just as it’s never a good idea to go grocery shopping when hungry, it’s never a good idea to write about a subject while in the heat of passion, and (2) I am spitting nails right now, and I suspect that a stray nail may hit my keyboard and result in the typing of some words that I am not accustomed to typing.

At the risk of sounding simplistic (see the three much more in-depth essays immediately below this one for significantly more detail), the major causes of this economic disaster – or at least the portion of it that relates to the mortgage crisis – are (1) the power of special interest groups who pressured their 'friends in congress' to pressure the banks and mortgage companies to lower their underwriting standards so that lower income groups and minorities could afford homes of their own, no matter their ability to make their monthly payments, (2) the unbridled power/corruption in congress that allowed them to pressure banks and mortgage companies to do as their special interest lobbies wanted in that regard, and (3) the money handlers who began placing more emphasis on making a quick personal buck than they did on earning the trust of their clients.

I voted for President Bush twice. With that said, I now believe he is a complete sellout.

In his attempt to explain the causes of this crisis, he insinuated that it all started because America’s economy was considered so brilliant that it attracted investors from all over the world. As a result, banks and financial institutions were awash in money, and that state of affairs planted the seed for this debacle. (*choke*)

That is the greatest whitewash of the reasons for this catastrophe (see paragraph two above) imaginable. Either President Bush is a complete moron and he believes that tripe, or he is the most blatant liar since Gepetto’s son walked off the woodcarver’s bench.

After the President’s speech, and after I stopped spitting nails, my husband and I watched Brit Hume and his panel on FoxNews offer up a brief analysis.

Charles Krauthammer, who is among my favorite political pundits, opined that the speech was quite good, and that he was surprised that the President spent virtually one-fifth of it attempting to explain the causes of the current crisis – since, in Krauthammer’s opinion, doing so amounts to simply an ‘academic exercise’.

An ‘academic exercise’? To discern what caused this major economic meltdown? Shall we just accept the notion that too much ‘foreign money’ floating around in American banks was the catalyst?

And if we don't uncover the reason for this crisis, and determine who was responsible for it, will there be any reform? Or, post-bailout, will the perpetrators eventually continue with business-as-usual? Anyone who has an even rudimentary knowledge of government at any level has the answer to that question at his fingertips.

Come on! The corruption, and the power of special interest groups, in Washington D.C. is so deeply entrenched that even the President doesn’t dare expose the real reasons behind a crisis for which the American taxpayer will be footing the bill for decades.

God help us. Our ‘leaders’ have completely lost the concept of ‘public service’. And forget about ‘truth’. It has become a ‘situational’ concept.

Our media have lost the concept of ‘factual information’.

Our citizenry had better awaken to the depth of the corruption in Washington D.C., or the most moral and prosperous civilization in the history of mankind will find itself relegated to the dustbin of history because its people were to darn lazy to fight for their individual liberty, to recognize and seek to excise corruption, and to demand that they be allowed to keep the fruits of their labor.

Two semi-related observations before I close up shop, grab my toothbrush and attempt to remove the rusty nail residue from my teeth:

(1) Why is it that McCain/Palin are sliding in the polls as a result of this financial crisis, when Barack Obama did significantly more (understatement of the century) to bring it about than did his opponents (see 'The Master of Deceit and Phony Outrage')?

And why is John McCain’s speech before the Senate in 2006, warning us of an impending crisis if Freddie Mac and Fannie Mae were not reined in, being righteously ignored by the mainstream media?


For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay. I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole. I urge my colleagues to support swift action on this GSE reform legislation.

The democrats killed this measure in committee preventing the full senate vote.

(2) Why am I consistently hearing analyses of the possible effects of the race issue in this election, with complete focus on that issue possibly harming the Obama candidacy? I have heard poll reports that supposedly show that up to six percent of white Americans claim they may have difficulty voting for a black. Yet, during these reports on the unfairness of racism in voting, I have not once heard mentioned the fact that 90+% of blacks openly admit that they will vote for Obama. Is that unprecedented, overwhelming majority the result of his superb presidential credentials?

~ joanie


Anonymous said...

In a talk Bush gave a week or so ago, flanked by Paulson, Bernanke and your friend and mine, Cox, he vowed to "persecute" those responsible for any wrongdoing. This is much better than merely "prosecuting" them-- more than I could have hoped for. ;)

lori_gmeiner said...

I thought it was a completely ineffective speech. He didn't even seem to believe what he was saying. Why the hell can't he finger the guilty parties? Most of them are Democrats.

Let's hope McCain can pull this election out, and let's hope he has more courage in the White House than his predecessor.

john galt said...

I agree with your assessment Joanie, but the most important part of your column is the last 2 questions. I'd like them to be asked by the media but I'm not going to turn blue holding my breath.

John Cooper said...

I guess I'm an "ideologue", too, because I believe that ideas are important. Only by holding the correct ideas can something like this situation be abated. The pragmatists among us are now screaming that the government should "do something", but doing something without thinking it through is guaranteed to make things substantially worse - maybe not immediately, but eventually. But even if we do think it through, there's no guarantee that we'll think of everything.

The Great Depression was an event that was initiated by the federal government, then made substantially worse and longer lasting by FDR's and the fed's populist meddling. It's my belief that had the government just stayed out of it, America would have had a short (one or two year) correction, then everything would have returned to normal. This had been the history of all previous "panics" here in 1819, 1837, 1857, 1873, and 1893.

Ignoring the moral question, centrally-planned economies always fail because of lack of price information. It's simply not possible for a committee of even the most knowledgeable and well-intentioned bureaucrats to have enough information to set prices; Only Adam Smith's "invisible hand" has the power to do that. This is the primary reason why the "government bailout" is guaranteed to fail.

If this plan goes through, the government will end up buying (with taxpayer money) a bunch of "securities" and maybe real property that they have no idea how to value. They won't know what to pay for them, and they won't know what to sell them for. So they'll do what they will be *required by law* to do - get rid of them at any cost. Since they'll have a blank check written on your and my bank account, that's not a problem (for them). You see, bureaucrats have no financial interest in buying low and selling high - it's not their money.

I'm still waiting for anybody to explain how "Main Street" will be affected if Fannie and Freddie are simply liquidated. Clearly the mortgage market would be affected. American's would actually have to go back to putting 20% down on a home and have sufficient income to make the payments. People might actually have to *save* for a down payment and rent in the meantime. Oh! The Humanity! Is that something to panic over?

Businesses might have more trouble getting loans, but I see that as a good thing. It will eliminate a lot of the "easy-money" excesses I see just around the little town where I live. (Example: In Brevard, pop 6,000, we have eleven pharmacies. ELEVEN! And they keep building them - three in the last year - although most of the parking lots remain empty.)

The "job market" around here is 99% service-oriented, all the manufacturing having left the area years ago. That market is booming, and doesn't take a lot of capital. I'm still unclear on how I would be affected personally if lower Manhattan sunk into the East River.

If that happened, we Americans might actually have to ~~~shudder~~~ start living within our means again. You know, I still remember a time people actually saved for a rainy day, and when one actually had to pay for the things he or she bought with cash or a check. Would life go on without credit cards? I'm pretty sure it would.

So at the moment, I'm of a mind that the government should just do nothing. I called my Senator (Dole) yesterday and told her secretary as much. Yeah, I know it was a totally pointless gesture...

John Cooper said...

From Dr. Housing Bubble Blog: Dear America, If This Bailout Fails, you will Fail. 2008 Financial Fear Mongering Tour.

"Ben Bernanke, Paulson, and Bush went on their financial fear mongering tour basically saying that if you don’t pass this bailout, the world as you know it will implode on itself...

"By a margin of 55 percent to 31 percent, Americans say it’s not the government’s responsibility to bail out private companies with taxpayer dollars, even if their collapse could damage the economy, according to the latest Bloomberg/Los Angeles Times poll.”

As it turns out, a large number of Americans actually have the guts to stand up for what is right. Plus, they realize that the economic plan will do very little to benefit them. Take a look at the above numbers. Approximately 30% of Americans own their homes free and clear. Many of these people do not want to bail out banks that made absurd idiotic loans while they were being prudent. In addition, many other Americans are making their mortgage payments on a timely manner. Do you think they are going to appreciate dolling out assistance to lenders that gambled their future away? Of course not."

Barberi said...

Three cheers for your rant, Joanie!

And three cheers for your rant, Cooper!

I don't get many six cheer mornings, so thanks to you both. ;)

kathymlynczak said...

For years I've heard people talking about how all politicians, even the President, have "puppet masters" pulling the strings behind the scenes. I've always chalked that idea up to conspiracy theory.

Last night for the first time I got the impression that Bush didn't believe a word he was saying, but he was saying what he needed to say.

I'm not saying the conspiracy theorists are right, just that I didn't get any reassurance at all from his speech.

Your writing sums up exactly how I felt too.

marcus aurelius said...

Well, most economists agree that the problems we are witnessing today developed over a long period of time. For more than a decade, a massive amount of money flowed into the United States from investors abroad, because our country is an attractive and secure place to do business. This large influx of money to U.S. banks and financial institutions -- along with low interest rates -- made it easier for Americans to get credit. These developments allowed more families to borrow money for cars and homes and college tuition -- some for the first time. They allowed more entrepreneurs to get loans to start new businesses and create jobs.

Verbatim from his speech. If that isn't a cop out about the real reasons I don't know what is. Not a word about the forced changes in the banking laws brought about by lobbyists for low income and racial quotas, etc.

He has an "R" behind his name but he's an embarrassment to conservatism without the courage to tell us who is to blame. The excess of foreign money is laughable and if the right people aren't implicated the chances of reform are slim to none.

SidBreem said...

Your two final questions demand answers. We won't get them from the media.

John Cooper said...

According to the NY Times, calls and E-mails to legislators are running over 9-to-1 in opposition to the bailout - even in socialist Vermont. But the b**tards are going to do it to us anyway. So much for representative government.

Constituents Make Their Bailout Views Known

calbrindisi said...

Even if this bailout passes, it's just a temporary measure. More bailouts will be necessary and the corruption in Washington isn't going away.

I moved most of my stock portfolio into more defensive positions today and also bought a modest number of gold American Eagles. There's not much else we savings minded Americans can do at this point.

Thanks for the great column, joanie.

John Cooper said...

2002: Bush's speech to the White House Conference on Increasing Minority Homeownership

"More and more people own their homes in America today. Two-thirds of all Americans own their homes, yet we have a problem here in America because fewer than half of the Hispanics and half the African Americans own their homes. That's a homeownership gap. It's a -- it's a gap that we've got to work together to close for the good of our country, for the sake of a more hopeful future.

"We've got to work to knock down the barriers that have created a homeownership gap.

"I set an ambitious goal. It's one that I believe we can achieve. It's a clear goal, that by the end of this decade we'll increase the number of minority homeowners by at least 5.5 million families. (Applause.) … And it's going to require a strong commitment from those of you involved in the housing industry..."

cw-patriot said...

John, your excerpts from Bush's 2002 speech are so typical of the ways in which both he and his father betrayed the Reagan Revolution.

I remember reading somewhere in 'The Reagan Diaries' (I'd look it up but I have loaned it out to someone) an entry in which he was scheduled to make some suggestions regarding government helping minority businesses.

He was reminding himself, in one of his late-night entries, that his compassion for lower income groups could not get in the way of his duty to keep government out of the business of redistribution of wealth.

The list of ‘accomplishments’ that both Bushes have achieved include countless ‘accomplishments’ that both eroded Reagan’s achievements and compromised with the left so significantly that it was often difficult to discern the ‘R’ behind their names. The amount of damage that the two Bushes have done to the Reagan Miracle is mind boggling.

Not that I'm laying this economic crisis at Bush's feet, mind you. The democrats in congress, and their pandering to special interest groups, played a significantly larger role. But the president's speech did absolutely nothing to expose the leftist perpetrators of this crisis, and did everything to see to it that the citizenry remains ignorant of their crimes.

As for the defense that 'he needs to work with them' ... that kind of compromising mindset is precisely what got us into this mess to begin with. And it sure as heck isn't gonna get us out of it.

Thanks for the excerpts and the links.

~ joanie

cw-patriot said...

I moved most of my stock portfolio into more defensive positions today and also bought a modest number of gold American Eagles. There's not much else we savings minded Americans can do at this point.

Cal, I'm no financial fortune teller, but I'd say you made some wise moves. :)

~ joanie

cw-patriot said...

John Cooper said:

The Great Depression was an event that was initiated by the federal government, then made substantially worse and longer lasting by FDR's and the fed's populist meddling. It's my belief that had the government just stayed out of it, America would have had a short (one or two year) correction, then everything would have returned to normal.

History does indeed tend to repeat itself, John. In this most recent case, because the thirst for power and the realization of ideological agendas always take precedence over the valuable lessons that history has to offer.

Even now, when we are facing possibly the worst economic cataclysm in our history, I still envision our 'leadership' in Washington meeting in smoky back rooms, basing their decisions on what's best for them and their agenda.

Thanks for the excellent insights.

~ joanie

cw-patriot said...

An update to the 'Eye of a Gnat' essay of a few days ago, for anyone who may be interested.

In that post I was lamenting the fact that we savings-oriented Americans, many of whom have opted to make conservative investments because of what we saw as a fragile economy, are even bearing the brunt of the economic turmoil, in places we never expected.

Excerpt from that post:

Throughout the playing out of the sub prime debacle, the crumbling of corporations that were once financial giants, and the ludicrous bailout proposals, we have maintained that stance, continuing to hold precious metals/miners and commodities long-term, but keeping the remainder in cash, which sweeps into the money market account.

A few days ago we received a letter from our online brokerage firm, telling us that the NAV in our money market fund has fallen below $1, due, in part, to the decrease in value of debt securities issued by Lehman Brothers and held by the fund.

Long story short … as a result, until our funds are redeemed by our brokerage, we will not have access to them for withdrawal or transactions. We were informed that this action is being taken in our best interest ‘in order to limit potential losses’.

This afternoon I received a phone call from a TD Ameritrade representative, asking whether I had any questions about the above, and telling me that TD Ameritrade has been successful in redeeming its clients’ money market accounts. The NAV in this particular money market has fallen to 97 cents, and TD Ameritrade will be assuming the responsibility to make up the 3-cent difference. (He told me how many millions it will be costing them, but I don’t recall the figure.)

It’s refreshing to receive a bit of good news, and experience a positive reaction to an announcement by a financial institution, considering the way in which economic events are unfurling of late.

TD Ameritrade has my personal kudos, which will result in loyalty to them to the degree that I will not consider moving our account from there for any reason other than a diminishing of their current high corporate standards.

~ joanie

Anonymous said...

The rumblings out of Washington aren't very good. Not that they ever are. This thing's going to get a whole lot worse before it gets better.

robmaroni said...

About one thing we may be sure. The U.S. deficit and national debt are going to soar. The credit rating of the United States, as this nation of nonsavers has to borrow abroad to save its banks, and their banks, is going to fall. We are going to be a poorer nation and people.

As for the promises and plans of Barack Obama and John McCain - be it for national health insurance or middle-class tax cuts - they are going by the wayside. For the United States is as bankrupt as Lehman Bros., with this difference: Uncle Sam can still borrow from abroad because foreigners see many juicy U.S. assets they would like to take off our hands with their hoards of ever-cheapening U.S. dollars.

"There is a great deal of ruin in a nation," Adam Smith once consoled a friend who lamented that Britain would be ruined if the 13 Colonies were lost.

We are about to test Smith's proposition.

From Bailout Offers Amnesty for Stupidity

John Cooper said...

Gold coin sales halted after retail rush in the Financial Times

By Javier Blas in London
Published: September 25, 2008

"The rush by retail investors into gold on Thursday forced the US government to “temporarily” suspend the sales of the popular American Buffalo one-ounce bullion coin after depleting its inventories.

"The shortage of gold coins is the latest sign of investors seeking a safe haven into bullion amid Wall Street woes. Gold prices this week surged above $900 an ounce, up about 20 per cent from its level before the collapse of Lehman Brothers.

"Safe-haven buying spurred by a weakening dollar and rising inflation on the back of high commodity prices have also benefited gold sales, analyst said.

"The US Mint said in a memorandum that “demand has exceeded supply” and, therefore, it was “temporarily suspending sales of these coins”. “We are working ­diligently to build up our inventory and hope to resume sales shortly,” it added.

"...The US Mint has sold since last January about 419,500 ounces of bullion in the form of American Eagles coins, more than double the 198,500 ounces it sold during the whole 2007. In 2006, it sold 261,000 ounces."
Funny that this is news in London, but not the U.S. /sarc