E-Con 101: Feds should butt out of business

I played golf this weekend with a friend who told me that this stock market crash is worse than a divorce.

“How so?” I asked. He said, “You end up with half of your net worth, and you still have your spouse.”

This has clearly been a confusing time for many who face the first major financial downturn — or perhaps recession — of their lives. The tendency is to blame whom the media tell you to blame for it.  Thus, John McCain and the hapless Republicans are wrongfully bearing the brunt of the blame for this natural purging of the excesses in the housing market of the last 10 years.

Amazingly, the financial crisis has pushed Barack Obama some 8 points ahead in the polls.

All this guy has to do is sit there and not be George Bush and he gains ground. And nobody can sit there and do nothing better — and with more style — than Barack Obama.

Obama is a finely tailored empty suit.

He is a guy who somehow represents bold and decisive “change” to 53 percent of Americans by having never authored any meaningful legislation and simply voting “present” (on the occasions that he was) on most issues.

For all the unenlightened things Bush has done, this financial mess is not his doing.

Most of the blame can be laid squarely at the feet of the Democrats, who made a supposed, quasi-government business like Fannie Mae into a social program that fueled its misguided lunacy by plying Senators like Barack Obama and Chris Dodd with wads of money and promises of a chicken in every pot and an Escalade in every garage.

Even as late as this year, Congressman Barney Frank, chairman of the House Ways and Means Committee, said that Fannie Mae and Freddie Mac were not taking substantial risks that could lead to financial disaster. Dodd and Frank pushed for more sub-prime loans to help their Democratic constituents who could not afford to pay the money back in the case of any downtick in housing values or an uptick in unemployment.

It was funny to watch the presidential debate last week and to hear both Obama and McCain say that they wrote a letter to the government warning about Fannie Mae.

Now how could they possibly ever imagine that a letter written to government would not be acted upon immediately? Who among us has ever had a well-crafted letter of concern to a government entity not result in an immediate and decisive response?

Each presidential candidate was trying to stake out his position that his letter was ignored earlier than his opponent’s.

Perhaps we can soon determine who was the more inept in this empty gesture and then, by default, we should elect the other. I for one cannot wait until this same government is running our health care system. I look forward to 2012 when I have to mail a letter to the Department of Healthcare Allocation, requesting treatment for my car crash injuries.

Because Obama does not know any better and McCain is trying to appease the anger in America, we have somehow become convinced that this mess is a failure of the free market system and stems from a lack of regulation. In reality, just the opposite is true.

There are no businesses in America more regulated than our own. Government-sponsored entities like Fannie Mae and Freddie Mac, unless they are banking (WAMU) and insurance (AIG), are regulated by the same crack ethical stalwarts in our government.

Four years ago, that moral authority and one of the faces of political arrogance, Eliot Spitzer, called a press conference to run out — guess who? — the chairman of AIG, Hank Greenberg. Greenberg was no less than the guy who owned billions in AIG stock and would probably have navigated this company, in which he had a major financial stake, through the current mess.

Instead, Spitzer replaced Greenberg, a man he had it in for, with cronies, who then proceeded to run the complex and heavily-regulated company right into the ground.  It turns out Greenberg, who had his net worth tied up in AIG stock, would actually have cared if the share price went to zero.

This race will soon get emotional and will lose all sense of logic.

I guess it began when the liberal activist group ACORN registered fake voters in key battleground states. In one case, fraudulent voters were given the names of some of the Dallas Cowboys.
This was stupid.

If ACORN did not want to get caught, they should have used names that no one in our country would recognize today, like the authors of the Federalist Papers.

Ron Hart is a southern humorist and political columnist. He worked for Goldman Sachs and was appointed to the Tennessee Board of Regents by Lamar Alexander. He can be reached at RevRon10@aol.com .

http://destinlog.onset.freedom.com/opinion/worse_6713___article.html/played_feds.html