I am sure you have heard by now that the big financial sector bailout stalled last night.
The Democrats just couldn't wait to start pointing their blame finger at Senator McCain with false allegations that McCain and House Republicans waited until the last minute to stall the bailout.
Rahm Emanuel, chairman of the Democratic Caucus, falsely claimed no one "raised an objection until we went to the White House for a bit of theater, and all of a sudden, in the 9th inning" when House Republicans offered their objections. The Washington Post reports Barney Franks, the Democrats' chairman of the House Financial Services Committee also blamed House Republicans.
The Democrats are full of it. The Democrats control Congress. They could pass this bailout if they wanted. But this is more about controlling blame than fixing the problem. The Democrats' Senate Majority Leader Harry Reid, made it clear the Dems felt they needed the political cover of McCain's involvement. Reid and Company just didn't like it when McCain showed up.
There is nothing to the Dems's false assertions that there were no objections until the last minute. According to the Washington Post, the Republicans were complaining all week about the proposed socialistic bailout.
Kevin Hassett does a good job explaining how the Democrats created the current financial crisis. It's really very simple:
Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.
How is a little more complicated, but not much. Fannie and Freddie fueled Wall Street's efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.
In 2005 Fannie and Freddie were enmeshed in accounting scandals that led to proposed reform co-sponsored by John McCain that would have created a "world-class regulator" to oversee the mortgage giants more like banks.
Alan Greenspan told Congress how urgent it was for it to act: If Fannie and Freddie "continue to grow, continue to have the low capital that they have, continue to engage in the dynamic hedging of their portfolios, which they need to do for interest rate risk aversion, they potentially create ever-growing potential systemic risk down the road," he said. "We are placing the total financial system of the future at a substantial risk."
The bill was killed by the Democrats: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn't even get the Senate to vote on the matter.
So having killed meaningful reform in 2005, the Democrats' finger of blame needs to point to McCain and the Republicans. Not convinced? Watch the following video:
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