I blame the Republicans
Posted by: McQ
Willem Buiter of the Financial Times does a pretty good job of laying out the Freddie Mac and Fannie Mae debacle. I don't necessarily agree with his solutions, but he does hit the high points as to why they're in trouble.
What I found much more interesting than his description and his solutions was this passage hinted at in his title:
There are many forms of socialism. The version practiced in the US is the most deceitful one I know. An honest, courageous socialist government would say: this is a worthwhile social purpose (financing home ownership, helping my friends on Wall Street); therefore I am going to subsidize it; and here are the additional taxes (or cuts in other public spending) to finance it.
Instead the dishonest, spineless socialist policy makers in successive Democratic and Republican administrations have systematically tried to hide both the subsidies and size and distribution of the incremental fiscal burden associated with the provision of these subsidies, behind an endless array of opaque arrangements and institutions. Off-balance-sheet vehicles and off-budget financing were the bread and butter of the US federal government long before they became popular in Wall Street and the City of London.
He nails it. And he properly nails both Democrats and Republicans as well. But as far as I'm concerned, it is Republicans and Republican administrations which deserve the lion's share of the blame. It isn't a secret that Democrats are far too comfortable with moving us toward socialism and if you listen to Barack Obama, such a desire is plainly evident when he gives any specificity to his usual generalizations.
However it is Republicans who, over the years, have bought into the socialist premises which have led to the existence of such institutions. It is their complicity through the decades that have ensured not only their implementation, but their survival.
You can't fault a dog when it acts like a dog. Democrats pushing socialism are Democrats acting naturally. But Republicans, given their rhetoric and supposed principles, don't have that excuse at all. In reality their problem has been lack of will, lack of spine and lack of principles. Or at least the principles they've claimed for at least a century.
Now, again, we see something government initiated, cobbled together and promised to oversee teetering and creaking and making noises that sound like collapse. And the solution?
Why more government of course - and more of your money.
Enjoy.
