October 26, 2007
by Donald G. Mashburn
The subprime mortgage mess has so many moving parts it’s hard to tell just how the ugly beast works and what drives it. Sure, gullible, unsavvy buyers with poor credit credentials took on more than they could handle. Some of them were dumb enough to think adjustable rate mortgage resets would be managed “somehow,” and housing prices could soar ever higher, even in the turbulence of inflated prices and the dwindling pool of buyers willing to pay them.
But when the smoke clears enough to sort through the economic rubble, we will be able to find plenty of tracks left by what this column has in the past called the “Greed Breed.” These are the opportunistic types referred to in news stories as, “lenders,” “mortgage bankers,” “banking industry” that inhabit banks, mortgage companies and savings and loans wherever other people’s money is allowed to accumulate.
This breed can and will structure deals for anyone, if it means the deal-doers can reap a profit. They know how to squeeze the last egg out of the golden goose, thinking they can keep the goose alive until they get their pockets, or socks, full.
But as shown by the past savings and loan scandals, and the wave of bank failures in the 1980s, members of the Greed Breed Club often get too greedy. And in the most flagrant cases, they aren’t content to squeeze the golden goose for all they can get: they run it down, kill it and eat it, guts feathers and all.
That over-greedy condition seems to have been reached in the subprime lending implosions that have lead to the demise of several lenders, and the infecting of many other institutions that are showing signs of serious illness, which for some may be terminal.
The gullible homeowners were easy pickings for the creative lenders. A recent survey by Peter D. Hart Research Associates, for the AFL-CIO, revealed that some three-fourths of borrowers knew little about how much larger their payments will increase when their mortgage rates are reset.
And as borrowers with higher interest rates grow in number, the ailments inflicting the housing-mortgage lending industries will spread to other areas of the economy. Rising concerns over the spreading of the money misery have caused the Democrats in Congress to push legislation that will enable federally-backed lending agencies, Fannie Mae and Freddie Mac, to increase their efforts in easing the credit crunch.
With Democratic “white knights” like Rep. Barney Frank, D-Mass., and Sen. Charles Schumer, D-N.Y., riding to the rescue, we can’t expect help for the huge throng of borrowers who can’t handle their mortgages with the adjusted rates. But when the mortgage-lender pain becomes really severe, we can expect to see the Democratically-controlled Congress attempt to cure it with a transfusion of taxpayer dollars.
This isn’t as inconsistent as one might think, if you think of Liberal Democrats as being anti-business. For you see, liberal big spenders in Congress are themselves members of the Greed Breed Club they also are adept at spreading around money that doesn’t belong to them.
The subprime meltdown has become huge, and could be potentially crippling to the national economy. It’s difficult to predict who will ultimately do the most damage, the Greed Breed of the lending industry, or the liberal Big Spenders and Fixers of the “stick-the-taxpayers” industry.
Mass Communication or Mass Misinformation
I watched President Bush’s news conference recently where he discussed the Children’s Health Care Fund bill then before Congress and which he subsequently vetoed. I also watched portions of the networks’ Evening News reports and the ongoing CNN reporting on the subject, as well as noting the president’s remarks at his news conference and several comments and remarks he made later.
Nothing I heard or read by the networks and newspapers and the AP even resembled what the president said. Mr. Bush went to great lengths to explain his opposition to the revised bill before Congress. The President has long been a supporter of children’s health and has supported these bills in the past. He wanted to continue to do that.
I should remind readers this bill is for the children of families who do not have, nor can afford, health insurance for their children. In other words, children of poorer families, or for families otherwise afflicted and cannot provide health insurance for their children. The democratic congress wanted to raise the ceiling income for those families to over $83,000 per year as funding guidelines. And they did raise the income ceiling to that level. That’s poor or unfortunate family income? I say that’s middle income for a family of four. Ample to protect your children’s health.
The President laid out those figures in great detail. He also gave members of the press at his press conference his take on the current bill, and why he felt the Congress and a few liberal politicians were playing politics with the welfare of unfortunate children and their families. He obviously was a supporter of the bill. Nothing the President said was reported correctly in the media. In fact, what was reported did not at all resemble the president’s remarks at the news conference, and were simply bald-faced lies.
This is just one instance of many in recent years that the mass media and the liberal Democratic Party have collaborated to misinform the American public. It was the final straw for me. This slow killing of the constitution and our principles of democracy simply must stop.
I am not a doomsday philosopher. But if Americans of any persuasion, republican or democrat, liberal or conservative do not come together to stop this mass misinformation, then the Republic is doomed just as the ancient Greek democracy slaughtered itself from within.
Is that what we want to see for the sake of one political party or the other, one politician over the other, one false opinion to gain the upper hand in a single election? The hatred the organizations have for one president? Is this the news media we have fought so hard to protect? So many lives lost in war over the past 230 years to save it?
Be careful what you read, question what you see and hear. And when you find lies and mass misreportingand you willaccuse the mass media sources publicly, tell your friends and neighbors. Only you, the citizens, the taxpayers, the electorate we, the peoplehave the power to stop this landslide to total destruction. A few elitists, politicians, Washington insiders, wealthy families and media empires have all the power now.
Pay attention, and let’s return power to where it was intendedto us. Whether you agree or disagree, don’t say you haven’t been warned.
Jack L. Key is a staff writer for the New Media Alliance, a published author and freelance writer. He may be reached at: firstname.lastname@example.org