December 27, 2009

From the ‘Can’t Make This Up’ Dept.: Napolitano Claims ‘The System Worked’

Filed under: Taxes & Government — Tom @ 11:51 am

NapolitanoAt Politico (HT Hot Air Headlines; video at RCP):

DHS Secretary Janet Napolitano said that the thwarting of the attempt to blow up the Amsterdam-Detroit flight this week demonstrated that “the system worked.”

Babe, that’s not what “worked.”

The only thing that “worked” is Jasper Schuringa, and he’s the one person in the whole affair (with an assist from the flight attendants and other passengers) who isn’t part of “the system.”

P.S. It makes you long for the glory days of Michael Chertoff, pathetic as he was.

P.P.S. Jonah Goldberg (HT Instapundit) — “Fire Napolitano.” The gal apparently has no interest or even curiosity about how the Flight 253 takedown attempt could or should have been prevented. Her entire focus is after-the-fact. That’s unacceptable.

Y’know, if they improved the prevention, they wouldn’t “have to” impose lunatic rules that are meant for unruly second-graders on every international traveler. They have to know this will accomplish nothing; it’s just a response for response’s sake.

P.P.P.S. Rand Simberg — “It’s ironic that on the day commemorating the birth of a lone man who was supposed to die for all of our sins, a little over two millennia later, we are now going to all have to suffer for the sin of another lone man.”

P.P.P.P.S. Michelle Malkin — “The ‘system,’ like Napolitano, was an epic fail. …. her hapless first-responder mentality is simply a reflection of the man who hired her.”

Relief Without Limits: Fannie Mae, Freddie Mac Get Blank Checks; NYT Provides Blank Coverage

FredAndFanLogos1209On Thursday, the Treasury Department issued a press release, called “Update on Status of Support for Housing Programs.” Its fourth paragraph reads as follows:

At the time the Federal Housing Finance Agency (FHFA) placed Fannie Mae and Freddie Mac into conservatorship in September 2008, Treasury established Preferred Stock Purchase Agreements (PSPAs) to ensure that each firm maintained a positive net worth. Treasury is now amending the PSPAs to allow the cap on Treasury’s funding commitment under these agreements to increase as necessary to accommodate any cumulative reduction in net worth over the next three years. At the conclusion of the three year period, the remaining commitment will then be fully available to be drawn per the terms of the agreements.

Translation: No matter how badly things further deteriorate at these former government sponsored enterprises, both of which since last year in essence have become government-controlled enterprises, Uncle Sam (i.e., current and future generations of taxpayers) will cover their losses.

Here is how three different news outlets headlined this Treasury/Obama administration move:

  • Wall Street Journal, Dec. 26 — “U.S. Move to Cover Fannie, Freddie Losses Stirs Controversy.”
  • Associated Press, Dec. 25 — “Treasury removes cap for Fannie and Freddie aid.”
  • New York Times, Dec. 24 (in Christmas print edition on Page B1) — “New Aid for Fannie and Freddie.”

It really is difficult to take the Times seriously any more.

James R. Hagerty and Jessica Holzer at the Journal and the AP’s J.W. Elphingstone identified why the move was made just before year-end, and noted the attention-avoiding Christmas Eve timing of the announcement:

(WSJ, 4th and 8th paragraphs) “The timing of this executive order giving Fannie and Freddie a blank check is no coincidence,” said Rep. Spencer Bachus of Alabama, the ranking Republican on the House Financial Services Committee. He said the Christmas Eve announcement was designed “to prevent the general public from taking note.”

…. The Treasury removed the cap on the size of available bailout funds by amending agreements it reached with the companies in September 2008, when the government seized control of the agencies under a legal process called conservatorship. The agreement allowed the Treasury to make amendments through the end of the year, without the consent of Congress. Changes made after Dec. 31 would likely involve a struggle with lawmakers over the terms.

(AP, 4th and 5th paragraphs) By making the change before year-end, Treasury sidestepped the need for an OK from a bailout-weary Congress.

While most analysts say the companies are unlikely to use the full $400 billion, Treasury officials said they decided to lift the caps to eliminate any uncertainty among investors about the government’s commitments. But the timing of the announcement on a traditionally slow news day raised eyebrows.

The Times article by Louise Story did not cite the December 31 deadline’s existence.

Elphingstone’s first sentence deserves special props: “The government has handed its ATM card to beleaguered mortgage giants Fannie Mae and Freddie Mac.”

The Journal and the AP stuck to the story itself, and also went into the realm of the quite generous pay packages the entities’ execs are receiving. Neither chose to provide any background about how the two entities got to where they are. But Times’s Story gave us this pitiful rendition of the true story:

The housing giants stumbled badly in the financial crisis after backing too many troubled loans. Late last year, the government put them into conservatorship, and since then they have provided most of the liquidity in the mortgage market, allowing homeowners to refinance and buy new homes. Now, announcing new long-term support for the companies, the Obama administration has effectively transformed them into arms of the government, using them to help carry out its mortgage modification programs.

I’m not buying what Story is selling in the second sentence of the excerpted paragraph about the two firms providing “most of the liquidity in the mortgage market.” Instead, they represent a significant component of the pervasive administration-induced atmosphere of uncertainty that permeates and holds back the entire economy.

Story’s story never tells us that it is the government, backed by Community Reinvestment Act requirements, that demanded that banks make these “troubled” (i.e., most subprime) loans, and that Fred and Fan buy them up. Some were kept on the entities’ books; others were dumped (oh, I’m sorry, “securitized and issued to gullible investors”). All of this led to the systemwide mortgage-lending and housing messes.

It should also not be forgotten that Democratic cronies too numerous to mention made millions — make that tens of millions — as executives and board members while running these entities into the ground and deliberately keeping fraudulent books while they were in charge (Fred, Fan). Sadly, all three stories did.

Cross-posted at NewsBusters.org.

Positivity: Roosevelt High School’s Football Season

Filed under: Positivity — Tom @ 6:46 am

It’s a long read, but worth it.

From Portland, Oregon — God bless Tom Swain, Neil Lomax, the members of SouthLake Foursquare Church, and most of all, the kids on Roosevelt High’s football team:

omewhere between home and the football field, Christian Swain’s driver’s side window short-circuited. This had better not be an omen, he thought. He’d waited his whole life — all 33 years — to be a high school head football coach, and he didn’t want his first season to be a clunker. He kept pressing the electric buttons inside his beat-up gold ’99 Ford Taurus, but the window stayed stuck wide open. As he turned onto Interstate 5, the wind stung his face. Good thing it was summer.

He drove onto campus and parked next to a stadium with no stands. The school — Roosevelt High in north Portland — was a notorious bottom-feeder located in the poorest part of the city. It had no cheerleaders, no marching band, no press box and, as far as Swain could tell, no quarterbacks. But still three months away from opening night, the coach had reason to believe he could pull this off. He had grown up just east of campus, on the wrong side of the bridge himself, and he knew if these kids were anything like him — hungry, a little nuts and searching for a better life — he could win a game. Maybe even two.

When the school hired him last January as campus monitor — i.e., to keep peace in the hallways — Swain was curious to know why the team had just gone 0-9. At that time, he had just applied for the head-coaching job and was desperate to read the pulse of the school. From his career as an undersized middle linebacker at nearby Lincoln High in the mid-’90s, he remembered Roosevelt as having tough, reputable teams. Built in 1923, the school resembled an East Coast prep academy complete with a picturesque bell tower. He had always seen potential there. Little did he know the place was rotting from the inside out.

Maybe it was the infiltration of gangs or the school’s abysmal test scores or the decaying facilities. Either way, parents in the area were hesitant to send their kids into the chaos, and because the city of Portland had open enrollment — meaning you could attend any school in your district — there had been a mass exodus.

The best students and athletes fled to Grant, Lincoln, Benson or Madison. Roosevelt was generally left with three kinds of students: kids too poor to leave, kids too naive to leave and kids too apathetic to leave. If every local student had been forced to attend, Roosevelt’s enrollment would’ve been a bustling 1,300. But that number was fewer than 700 by the spring of ’09 when Swain was finally named interim coach.

And from what he heard, only 18 of them played football. ….

Go here for the rest of the story.