Wednesday, August 13, 2008

Bush Signs Sweeping Housing Bill –The Looters Strike Again!

This article in the N.Y. Times brings to my mind a book by Frederic Bastiat entitled, ‘That is Which is Seen and That Which is Not Seen.’ In this book, Bastiat discusses the implications of legislation such as this and its unseen effects on our economy and on the people as a whole. For example, its seems that this legislation will “keep more deserving American families in their homes,” as Mr. Fratto says. But what are the far reaching effects of this legislation?? The article hints on a few things such as the quote from Mr. Walker. What do you think???

Posted by Corey of Project Liberty

WASHINGTON — President Bush signed into law on Wednesday a huge package of housing legislation that included broad authority for the Treasury Department to safeguard the nation’s two largest mortgage finance companies and a plan to help hundreds of thousands of troubled borrowers avoid losing their homes.

Mr. Bush signed the legislation, which Congress approved last week, shortly after 7 a.m. in the Oval Office, the deputy White House press secretary, Tony Fratto, said.

The law authorizes the Treasury to rescue the mortgage finance giants, Fannie Mae and Freddie Mac, should they verge on collapse, potentially by spending tens of billions in federal monies. Together, the companies own or guarantee nearly half of the nation’s $12 trillion in mortgages.

Partly to accommodate the rescue plan for the mortgage companies, the bill raises the national debt ceiling to $10.6 trillion, an increase of $800 billion. The bill also creates significant liabilities and risks for taxpayers, that are virtually impossible to calculate.

“We look forward to put in place new authorities to improve confidence and stability in markets, and to provide better oversight for Fannie Mae and Freddie Mac,” Mr. Fratto said. “The Federal Housing Administration will begin to implement new policies intended to keep more deserving American families in their homes.”

Though the legislation was the product of months of intensive work by lawmakers in both parties and has been hailed as the most aggressive intervention by the government into the housing market in more than a generation, perhaps since the New Deal, no members of Congress were invited to the signing.

The enactment of the legislation comes in the same week that the administration announced that Mr. Bush would leave behind a record $482 billion deficit, which will probably grow substantially if home values continue to decline and if there are further reductions in corporate and personal income as many economists are forecasting for the rest of the year. Because of the growing deficit, Democrats said, the debt ceiling had to be lifted regardless of the housing bill.he budget office has estimated that 35 percent of the refinanced loans will end up in trouble again.

Mr. Walker noted that other government interventions in the private market, including a rescue of the Chrysler automobile company had provided an opportunity for taxpayers to profit. But when it comes to the mortgage giants, he said, there is no upside.

“The way this is structured,” he said. “It’s only a matter of how much the taxpayers are going to lose.”

Supporters of the legislation — including Senator Christopher J. Dodd, Democrat of Connecticut and Senator Richard C. Shelby, Republican of Alabama, the leaders of the banking committee, and Representative Barney Frank, Democrat of Massachusetts, the main author of the legislation in the House — say the law represents the best way to help stabilize the housing market, potentially putting a solid floor under declining prices.

The bill includes an array of other aid for troubled borrowers, and about $15 billion in housing-related tax breaks. It also includes nearly $4 billion grants to local governments to buy and refurbished foreclosed properties, which Mr. Bush had opposed even as he signed the measure. The White House views that provision as a giveaway to banks and other lenders who own the seized properties.


  1. While this is an unfortunate turn of events, it was not unexpected. When people gain conrol of other peoples money (in this case through taxation) they are seldom good stewards over it. However, even the venerable Ronald Regan fell into this trap when he signed the bill to bail out the Continental Illinois bank...,9171,921736,00.html

    It should give us pause to remember that we are ultimately accountable and the people we elect are accountable to us. Upon receiving recent property taxes notices this week I discovered a proposed 200% increase in the taxes on one of my properties. The money is proposed to fund 'special programs'.

    The economy can bear these reckless actions for only so long. Take action now and contact your elected officials, or help elect new ones.

    Blood, whips and guns--or dollars. Take your choice--there is no other--and your time is running out.

    "Those who make peaceful revolution impossible, make violent revolution inevitable." - John F. Kennedy

  2. One of the challenges with legislation of this size (600 pages) is that which is seen and that which is not seen. That which is seen is government bailing out families in need to help stave out more economic woes. Benjamin Franklin, as well as others, has stated:

    "The man who trades freedom for security does not deserve nor will he ever receive either."

    So the American public has pled for security so is it logical that some level of freedom has been traded?

    Worldnetdaily has reported the following:

    Congress' bailout opens doors to eminent domain seizures: Warning issued about 'bonanza' of potential property confiscations

    What are some of the highlights?

    Fingerprinting for those associated with mortgage industry

    "A provision many are interpreting as allowing the federal government to obtain information about online spending, money transfers and purchases, including ordinary eBay purchases."

    Wow! Then you Ron Paul giving his thoughts on the bill at


    What freedoms have we traded to obtain security with this bill? Any thoughts?



blogger templates | Make Money Online