A New Face

The Washington Times reported on Thursday that Kathy Kraninger has been confirmed as the Director of the Consumer Financial Protection Bureau (CFPB) and will serve for the next five years.

The article concludes:

Meanwhile the CFPB is still facing major legal hurdles.

Some federal judges have ruled that by placing so much power — including an independent budget that Congress doesn’t control — in a single director, the CFPB violates the Constitution. But a ruling earlier this year by the full U.S. Circuit Court of Appeals for the District of Columbia upheld the singe-director structure.

Let’s take a look at the inception of the CFPB. The CFPB is the brainchild of Massachusetts Senator Elizabeth Warren. It was passed as part of the Dodd-Frank Act. The Dodd-Frank Act was Congress’ way of dealing with the housing bubble that caused the recession of 2008. However, the congressional solution was aimed at banks and Wall Street. It made no mention of the role that Congress had played in creating the housing crisis and made no effort to take responsibility for their actions or prevent a repeat of the problem.

In 1995 The Community Reinvestment Act (CRA) was changed, allowing Fannie Mae to purchase $2 billion of “My Community Mortgage” Loans, pilot vendors to customize affordable products for low and moderate income borrowers. Some of the things done to make the loans more affordable were low (or no) down payments and variable interest rates. Fannie Mae guarantees mortgages and then sells them to banks and investors. Banks were forced to issue sub-prime mortgages or pay large penalties. As more people took out mortgages, the price of houses rose quickly.  In 2005, 91 percent of Fannie Mae loans were variable rate loans. In 2004, 92 percent of Fannie Mae subprime loans were variable rate loans. Interest rates rose, gas prices increased, and people could not pay their mortgages. The subprime market collapsed, and foreclosures increased rapidly. Banks stopped making mortgage loans.

There were efforts made to stop this train. On September 11, 2003, The New York Times reported:

Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

…a new agency would be created within the Treasury Department to assume supervision  on Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

The Democrats opposed the reform. Barney Frank, a Democrat from Massachusetts, said that it would mean less affordable housing. Melvin Watt, a Democrat from North Carolina, said that it would limit the ability of poor families to get affordable housing.

In 2005, John McCain warned of a coming mortgage collapse. He sponsored S.190 (109th), Federal Housing Enterprise Regulatory Reform Act of 2005. The Democrats blocked it. It was again brought up and blocked in 2007.

Opensecrets.org lists campaign contributions to politicians. Fannie Mae gave generously to insure that it would not be regulated. Some Democrats and Fannie Mae executives had ‘sweetheart’ loans from mortgage companies that were heavily involved in sub-prime mortgages.

So where am I going with this? The housing bubble was created by bad legislation. Bad legislation continues. In August 2016, The New York Post reported:

The Obama administration is doing its best to give the nation another mortgage meltdown.

As Paul Sperry recently noted in The Post, Team Obama has pushed mortgage lenders to offer home loans to folks with shaky credit, setting up conditions for another housing-market collapse.

Wasn’t the last one bad enough?

Credit scores of approved borrowers, for example, have been trending down, even as their debt levels have grown.

The Federal Housing Administration and government-sponsored “independent” lenders Fannie Mae and Freddie Mac have been demanding lower credit standards — just as the feds did starting under President Bill Clinton, in pursuit of the same “affordable housing” goal.

Some borrowers need only put 3 percent down to get a Fannie Mae loan — even if the downpayment is a gift. Fannie also has started up a new subprime lending program.

The Office of the Comptroller of the Currency recently warned that mortgage underwriting standards have slipped and now reflect “broad trends similar to those experienced from 2005 through 2007, before the most recent financial crisis.”

The Consumer Financial Protection Board (and Dodd-Frank) were not related to the cause of the 2008 recession–the recession was the result of bad laws. Both the CFPB and Dodd-Frank need to go away. They are nothing but a blatant example of government overreach.

Getting It Half Right

The mainstream media never hesitates to rewrite history when it is to their advantage, but every now and again they accidentally begin to report actual facts.

The Nation posted an article yesterday about the role Bill Clinton played in the 2008 mortgage meltdown. This information is readily available information that the mainstream media has so far ignored.

The article reports:

Candidate Clinton is essentially whitewashing the financial catastrophe. She has produced a clumsy rewrite of what caused the 2008 collapse, one that conveniently leaves her husband out of the story. He was the president who legislated the predicate for Wall Street’s meltdown. Hillary Clinton’s redefinition of the reform problem deflects the blame from Wall Street’s most powerful institutions, like JPMorgan Chase and Goldman Sachs, and instead fingers less celebrated players that failed. In roundabout fashion, Hillary Clinton sounds like she is assuring old friends and donors in the financial sector that, if she becomes president, she will not come after them.

The seminal event that sowed financial disaster was the repeal of the New Deal’s Glass-Steagall Act of 1933, which had separated banking into different realms: investment banks, which organize capital investors for risk-taking ventures; and deposit-holding banks, which serve people as borrowers and lenders. That law’s repeal, a great victory for Wall Street, was delivered by Bill Clinton in 1999, assisted by the Federal Reserve and the financial sector’s armies of lobbyists. The “universal banking model” was saluted as a modernizing reform that liberated traditional banks to participate directly and indirectly in long-prohibited and vastly more profitable risk-taking.

While that is true, you need to take a step back and look at what actually made that change necessary. Due to some changes in federal regulations and pressure by groups like ACORN, banks were forced to issue loans to people who could not pay them back. This sub-prime loans were doomed to fail, and banks needed to find a way to cut their loses. The issuing of the sub-prime mortgages goes back to a law passed during the Carter administration that was put on steroids during the Clinton administration. When the Bush administration called for curbs on Freddie Mac and Fannie Mae, they were rebuffed by Chris Dodd and Barney Frank in Congress. It was later revealed that Chris Dodd had a ‘friends and family’ mortgage from one of the major players in the sub-prime mortgage market.

For the entire story, please watch the video below. I have posted it before; it is not new. I am embedding it because I am afraid that it will disappear from YouTube.


This is the real story of what happened in the economic meltdown.

The War On The Fishing Industry Continues

On Thursday, the Washington Examiner posted an article about the Obama Administration’s continuing war on the fishing industry. Having lived in Massachusetts for a number of years, I saw the results of this war. I also saw that on occasion Massachusetts elected people to Congress who would fight the Administration on this issue. Scott Brown was one of those people, and oddly enough, so was Barney Frank. Both men understood the importance of the fishing industry to New England and also understood that the environmentalists who were fighting that industry were often fudging the numbers they were using in that fight.

The article at the Washington Examiner points out the money behind the attack on the fishing industry. The article has an illustration of the groups that are funding the attack. Please follow the link to the article and view the chart–it is amazing.

The article reports:

For more than a decade, the National Marine Fisheries Service has devoured fishing fleets while Big Green’s money octopus prods the feds by waving grant-eating enviros in its tentacles, causing them to hook the public’s attention with mindless frenzy against “overfishing.”

…Stolpe (Nils Stolpe, veteran executive, consultant, and advocate for the commercial fishing community) hopes to get fair play. He spoke of the House Natural Resources Committee Chairman Doc Hastings, R-Wash., and panel members’ concern over attacks on the seafood industry. Stolpe said, “They’ve had four hearings this year, getting ready to reauthorize the primary ocean fisheries management law.”

That law, the Magnuson-Stevens Fishery Conservation and Management Act, has had provisions for a thriving, respected seafood industry since it was first passed in 1976 — but Big Green pressure has blotted out everything that would help production.

University of Washington fisheries Professor Ray Hilborn focused on that problem in a September committee hearing, pointing out that the Magnuson-Stevens Act provides not only for rebuilding fish stocks, ensuring conservation and protecting essential habitat, but also, “the Act makes it clear that one objective is to provide for ‘the development of fisheries which are underutilized or not utilized … to assure that our citizens benefit from the employment, food supply and revenue which could be generated thereby.’”

Hopefully the attack on the fishing industry can be stopped before all of the small fisherman are put out of business.

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About That Free Speech Thing

Today’s Wall Street Journal posted an article about a Democrat effort to limit political donations by businesses after those donations were allowed by the Supreme Court’s Citizen’s United decision.

The House Oversight Committee is investigating events that occurred under the previous chairman of the Securities and Exchange Commission. Events similar to those at the Internal Revenue Service–senior officials rolling over career staff to politicize the agency–evidently also occurred at the Securities and Exchange Commission.

The article reports:

Last year politicians like then-Rep. Barney Frank and liberal tax-exempt groups like Public Citizen were encouraging the SEC to demand more disclosure from public companies about the organizations they support. Staff for Mr. Frank specifically told the SEC that, “There is particular interest in what the authority is for disclosure of 501(c)(4) contributions (political contributions).” Mr. Frank’s staff also noted that the interest was coming from the House Democratic leadership.

A former Democratic Congressman gave the political motive away while lobbying the SEC’s then-chairman Mary Schapiro. The former lawmaker, unnamed in a memorandum accompanying the Issa letter, was asked by Ms. Schapiro why this wasn’t a job for the Federal Election Commission (FEC). The former pol responded, “because the FEC is even more broken than you,” according to a May 2012 email sent by the deputy director of the SEC’s division of corporation finance. Democrats couldn’t get what they wanted out of the Congress or the FEC. So they went to the SEC.

This sort of behavior is unacceptable. Hopefully the House Oversight Committee will be able to hold the people who initiated this sort of illegal political activity accountable.

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The Times They Are a’Changin’

Things are happening in Massachusetts that I never thought I would see. When I moved into the Commonwealth in 1978, I wasn’t even convinced that there were two parties on the ballot (after all, I tended to lean Democrat in those days). Tonight I attended a Republican Town Committee meeting in Plainville that was informative, upbeat, and encouraging to those of us who would like to see Massachusetts become a two-party state.

One of the highlights of the meeting was an informal presentation by Elizabeth Childs, candidate for Congress in the 4th District of Massachusetts. She is running in the Republican primary for that seat, currently held by Barney Frank, who is not running for re-election.

Mrs. Childs biography can be found on her website:

Elizabeth Childs is a dedicated physician, distinguished public servant, small business owner, an outspoken advocate, wife, mother, and community leader.

 Elizabeth has been a resident of Brookline for more than 20 years. She and her husband, Ralph Grieco, a retired Navy and Navy Reserve veteran, have two young children who attend the Brookline Public Schools. She owns and operates a successful private medical practice in Brookline. The family has traveled extensively across North America, including driving with their Airstream trailer to the Arctic Circle and spending weeks camping in the Alaskan wilderness.

 Solid roots as a distinguished medical doctor

 Dr. Childs is Board Certified in Adult, as well as in Child and Adolescent Psychiatry from the American Board of Psychiatry and Neurology. She has an extensive background in providing services to people with serious mental illness, which includes work in both the private and public sectors.

 After graduating from Mount Holyoke College and the University of Cincinnati College of Medicine, Dr. Childs became Chief Resident in Adult Psychiatry at the Massachusetts Mental Health Center, where she also completed her fellowship in Child Psychiatry. She associated with Carney Hospital in Dorchester, and served as Chief and Director of Psychiatry from 1996-2003. She also served as President of the Massachusetts Psychiatric Society and Chair of its Legislative Committee.

Mrs. Childs briefly laid out her goals and ideas for representing the people of Massachusetts. She stated that she believed that we should not look to Washington for solutions to every problem–solutions come from individuals. She pointed out that we need to stop increasing the national debt–debt enslaves our children. The demographic in the 4th District in Massachusetts tends to be fiscally conservative and socially moderate. Mrs. Childs perfectly fits that demographic. She believes that she can win the independent vote. She also cited the example of Scott Brown as a Republican who is able to work with people of both political parties in order to get things done. She plans to follow that example if she is elected–pointing out that partisan bickering often prevents Congress from doing things that need to be done.

No matter which political party they support, most people understand the need for a two-party system. The parties will always have their differences, and sometimes that stands in the way of progress, but the parties also hold each other accountable and attempt to keep each other honest–that is something desperately needed.

The meeting was informative and encouraging. Democracy depends on the participation of citizens in government. It is always good to see people excited about their state government and willing to get involved.


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Why Is It That The People Who Are Not Impacted By Higher Gas Prices Always Want The Rest Of Us To Pay More ?

I live in Massachusetts. After the redistricting this year, I was moved into Representative Barney Frank‘s district. Barney Frank is not running for re-election–thus there is an open seat. At the present time, there is only one Republican in the Massachusetts Congressional delegation–Scott Brown. If I have my way, there will be at least two after the 2012 election.

The Massachusetts Democrat party, in a truly typical move, put forth Joseph Kennedy III as the candidate for Barney Frank’s seat. I am not even sure he lives in the district he will represent, but he can afford to buy another house if he needs to. Qualifications? You’re kidding.

The Daily Caller that Joseph Kennedy III wrote an online letter to supporters calling for an end to “cheap oil.”

The online letter states:

Second, we need to get serious about our dependence on foreign oil. Energy independence is the goal most often talked about over the last 40 years while also the most neglected.

Nixon, Ford, Carter, Reagan, Bush, Clinton, Bush, Obama – they’ve all talked about the same thing: the need to wean ourselves off our debilitating dependence on foreign oil.

The cycle that allows cheap oil to trump tough choices has to stop. 40 years is enough.

And while mortgaging our energy future to foreign interests, we’ve also surrendered our financial independence. We’ve run up $15 trillion in national debt.

Has it not occurred to this man that energy independence (development of our own energy sources) might be a better answer to this problem?

The article reminds us:

Since 2005, Kennedy’s father, former Massachusetts Rep. Joseph Kennedy Jr., has teamed up with Hugo Chavez, the anti-American, communist strongman of Venezuela, to bring free oil to poor people in the United States.

I hope the Massachusetts voters think carefully before they vote. Joseph Kennedy III is not a man we need in the House of Representatives right now. The increased cost of gasoline has stretched the budgets of all ordinary people–raising it more will do serious economic damage to the state and national economy. What in the world is this man thinking?


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Barney Frank Retires

The Hill is reporting today that Barney Frank will not be running for reelection in 2012.

The article reports:

His legislative legacy is likely to be the Dodd-Frank financial reform bill that passed in 2010 in the wake of the Wall Street meltdown that sent the economy into a tailspin in 2008. Hailed by the Obama administration, the law has drawn sharp criticism in the Republican presidential nomination fight, and one leading contender, former Speaker Newt Gingrich (R-Ga.), even suggested that Frank be jailed, along with Dodd, for their support of the mortgage giants Fannie Mae and Freddie Mac in the lead up to the financial crisis.

I suspect that if the Republicans take two branches of government in the 2012 election, Dodd-Frank will be revised or repealed. It was a legislative solution that never addressed the actual cause of the problem. Representative Frank’s statements in the years before Fannie Mae and Freddie Mac’s collapse declaring that the government would not be on the hook if the companies went bankrupt are a matter of record. His role in making home loans available to people not able to pay them back is also a matter of record.

With the recent redistricting in Massachusetts, I now live in Barney Frank’s district. It will be interesting to see exactly what happens next.

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