Sunday, June 12, 2011

Weekend Newsbites: Sat. & Sun., June 11 & 12, 2011


Just a happy song...
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1 comment:

William R. Barker said...

http://online.wsj.com/article/SB10001424052702304259304576375491103635726.html?mod=WSJ_Opinion_LEADTop

Rep. Michele Bachmann of Minnesota is best known for her conservative activism...

* FOLKS - THIS IS THE WSJ WEEKEND INTERVIEW WITH MICHELE BACHMANN. I URGE YOU TO READ THE FULL PIECE.

When I (the "I" being Stephen Moore of the WSJ) ask who Bachman reads on the subject [of economics] she responds that she admires the late Milton Friedman as well as Thomas Sowell and Walter Williams.

"I'm also an Art Laffer fiend - we're very close," she adds.

"And Ludwig von Mises. I love von Mises," getting excited and rattling off some of his classics like "Human Action" and "Bureaucracy." "When I go on vacation and I lay on the beach, I bring von Mises."

(*THUMBS UP*)

I ask for her explanation of the 2008 financial meltdown. "There were a lot of bad actors involved, but it started with the Community Reinvestment Act under Jimmy Carter and then the enhanced amendments that Bill Clinton made to force, in effect, banks to make loans to people who lacked creditworthiness. If you want to come down to a bottom line of 'How did we get in the mess?' I think it was a reduction in standards." She continues: "Nobody wanted to say, 'No.' The implicit and then the explicit guarantees of Fannie Mae and Freddie Mac were sopping up the losses. Being on the Financial Services Committee, I can assure you, all roads lead to Freddie and Fannie."

* ABSOLUTELY CORRECT!

Ms. Bachmann voted against the Troubled Asset Relief Program (TARP) "both times," she boasts...

* AND THAT ALONE IS REASON ENOUGH TO SUPPORT HER!

Insufficient focus on constitutional limits to federal power is a Bachmann pet peeve. She complains that no one bothered to ask about the constitutionality of these extraordinary interventions into the financial markets. "During a recent hearing I asked Secretary Geithner three times where the constitution authorized the Treasury's actions, and his response was, 'Well, Congress passed the law.'"

(*JUST SHAKING MY HEAD*)

"It's like when you come up to a stop sign and you're driving. Some people have it in their mind that the stop sign is optional. The Constitution is government's stop sign. It says, you - the three branches of government - can go so far and no farther. With TARP, the government blew through the Constitutional stop sign and decided 'Whatever it takes, that's what we're going to do.'"

Does this mean she would have favored allowing the banks to fail?

"I would have. People think when you have a, quote, 'bank failure,' that that is the end of the bank. And it isn't necessarily. A normal way that the American free market system has worked is that we have a process of unwinding. It's called bankruptcy. It doesn't mean, necessarily, that the industry is eclipsed or that it's gone. Often times, the phoenix rises out of the ashes."

* EXACTLY RIGHT!

She also bristles at the idea, pushed of late by the White House, that the auto bailouts were a big success for workers and taxpayers. "We'll probably be out $15 billion. What was galling to so many investors was that Chrysler's secured creditors were supposed to receive 100% payout of the first money. We essentially watched over 100 years of bankruptcy law thrown out the window and President Obama eviscerated the private property interests of the secured creditors. He called them 'greedy' for enforcing their own legal rights."

* CORRECTAMUNDO...!!!

* SERIOUSLY, FOLKS, TAKE THE TIME AND READ THE FULL INTERVIEW.

June 12, 2011 at 11:04 AM

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