With all of that government spending in mind ... Barack Obama is ramping up his wealth envy rhetoric - scolding Wall Street and urging financial regulatory reform. Our president used such words as "reckless" and "fat cat bankers" to refer to Wall Street and financial institutions. Obama wants Congress to pass financial reforms in order to "address the irresponsibility and recklessness" that led to an economic crisis. You see, according to Obama, more government could have prevented our financial meltdown. He says, "It was a disaster that could have been avoided if we'd had clearer rules of the road for Wall Street and actually enforced them." No mention of the government programs, like the Community Reinvestment Act, that played a major role in the crisis. But that doesn't jive with his wealth envy angle.
In fact, last night on "60 Minutes" Obama said he is concerned that banks are returning bailout money so that they can pay large bonuses "without restraint." Here's the quote:
"I think that in some cases, [to be able to pay bonuses] was the motivation," he said, "which I think tells me that the people on Wall Street still don't get it. ...They're still puzzled why it is that people are mad at the banks. Well, let's see. You guys are drawing down $10, 20 million bonuses after America went through the worst economic year...in decades and you guys caused the problem."
I'm thinking that Obama is thinking that if he yells and screams about the evil rich bankers enough the people will simply accept his rantings on faith and will never make any effort to try to understand what brought us to this financial situation in the first place.
Let's see. Can I do this in one paragraph?
It becomes government policy that everyone should have the opportunity to own a home. The government cajoles private lending institutions into making irresponsible loans with promises to buy those loans and shield the financial institutions from liability. Financial institutions that don't go along with the lending frenzy are punished. There's a rush to buy homes as the government-guaranteed loans flood the landscape. High demand forces home prices up. People see increasing home values and are convinced they can still their loans when the interest rates increase by simply refinancing. The bubble starts to burst when some borrowers realize that they aren't going to be able to repay their loans and the refinancing isn't available. Home values crash. Lenders and homeowner find themselves upside down. Financial institutions once worth billions crash and burn. Here we are.
There's an argument to be made that none of this would have happened if the government hadn't encouraged, even forced banks to make irresponsible loans to people who had no way in hell of paying them back.
No ... really can't do it in one paragraph. We still haven't talked about the sensational news stories about mortgage lenders "red lining" and the government threats and pressure that came out of those racially charged studies.
Anyway .. here's Obama - our colossal mistake - going on another one of his rants against the private sector. In the mind of The Chosen One all which is evil has been brought to us by the private sector, and all that is good comes from government. Remember ... and I'll keep reminding you of this as long as I need to ... our illustrious president referred to the private sector as "the enemy" in his book. That's why he's engaged in a war to destroy it.
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