Tuesday, September 16, 2008

Political Rant: Tar and Feather George Bush, Phil Gramm, and McCain if He Wins

Hello Bloggers - The Dallas Morning News is reporting today that Phil Gramm, the author of the credit crisis along with the Republican Congress and Bill Clinton in 1999, could be a serious problem for John McCain. I think the article is a wonderfully succinct timeline of what led us to this disaster. Break out the tar and feathers people!

Excerpts: John McCain's Phil Gramm problem
"In the late 1990s, former Texas Senator and economics prof engineered financial reform. He led the effort to break down the barriers between traditional banking and investment banking. In a pure economics sense, he was right. Economies of scale, economic growth and wider markets were the byproducts. But deregulation was viewed as king and regulatory oversight became a curse word. Anyone who mentioned the need for balanced regulation was shouted down as a backer of Big Brother/ Big Government. Therein lies McCain's problem."

"Not that long ago, Gramm said the economy was sound and Americans were whiners. Now McCain -- on the day Wall Street implodes and stocks crash -- says the nation's economic fundamentals are sound. I think not."
"The late 1990s and early 2000s gave rise to the era of the Bush Administration's first Securities and Exchange Commissioner, Harvey Pitt, whose claim to infamy was his attempt to allow Corporate America police itself. He also was slow to acknowledge the depth of corporate accounting scandals, and saw no perceived conflict in conducting private meetings with former accounting clients under SEC investigation. And over the years, the SEC -- before and after Pitt -- has been budget compromised, weighed down by too many companies and not enough staff. The pushback to those abuses? Sarbanes-Oxley Act of 2002."

"I think it is telling that the SEC has not been a major player, that the Federal Reserve and Treasury are carrying the burden during this financial crisis. I will be interested in seeing how McCain plans to balance the free market with oversight without re-erecting some barriers or giving regulators more authority to proactively address pending financial threats to the economy."

(Read the whole article at: http://dallasmorningviewsblog.dallasnews.com/archives/2008/09/john-mccains-ph.html)

I posted this article because there are many debates going on about what caused the credit crisis and this week's collapse - this was a good explanation. The culprit is the 1999 Gramm-Leach-Bliley Act that deregulated the industry. The bill was passed with the overwhelming support of Republicans along with a few Blue Dog Democrats and Bill Clinton - NAFTA too, thank you Bill. Clinton and the "Dogs" claimed to support more accessible credit for the middle class, and that's what many Repubicans are now blaming everything on today. They are wrong. The law has many rules in place to guard against the disasters of the past eight years. The blame should rest purely with the Bush Administration, Phil Gramm and his Enron wife, the SEC and Harvey Pitt, and the Treasury. Of course, Alan Greenspan deserves a large chunk of it. If you wish to debate, please be sure to read the actual laws first. In the meantime, get me the tar and feathers!

Tuesday's Political Rant #3 - Michael

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