I need to post something

As the title indicates, I am feeling pretty lazy for not having written anything on my blog for a while. As a default posting I thought I would complain about politics.

So now the government is not only bailing out homeowners who made poor decisions i.e. bought homes with no money down, a floating interest rate, and no income and now have to foreclose because they can't make the high mortgage payments from drastically increasing interest, but our "friends in Washington" have decided to bail out Fannie Mae and Freddie Mac, the two largest financial institutions involved in mortgages. (I can't think of the term for them but I do know what they do, a bank supplies a mortgage to an individual and then the bank sells that mortgage to these other companies). The congress has moved to allow these two private companies to have an unlimited line of credit (temporary but no time specification on how long temporary will be) .... Actually I just decided to post a couple paragraphs from a conservative email I receive regularly that explains these issues much better than me.

On Wednesday, the House passed its housing bill by a 272-152 vote. The Senate will vote in coming days and send it to President George W. Bush, who has dropped his veto threat. The multi-provision bill became even more of an “emergency” because of trouble at Fannie Mae and Freddie Mac, which, between the two, own or guarantee almost half of the nation’s mortgage market. Along with the Federal Housing Administration, Fannie and Freddie accounted for 90 percent of mortgages originated in the second quarter.

The Washington Post reports, “The measure would grant [Treasury Secretary Henry] Paulson immediate but temporary authority to extend an unlimited line of credit to Fannie Mae and Freddie Mac or to buy their stock if their financial condition deteriorates sharply before December 2009.” Paulson will also have wide latitude in setting the terms of a bailout, though the bill’s primary author, Rep. Barney Frank (D-MA), cautions, “You have to protect the taxpayer.” Protect taxpayers by using their money to bail out irresponsible lenders and borrowers? That’s Democrat logic for you.

In line with that bit of fiscal irresponsibility, the bill raises the national debt ceiling by $800 billion to $10.6 trillion to make room for any bailout. The Post reports further, “In addition to the rescue plan for the mortgage-finance firms, the package includes a plan to rescue more than 400,000 homeowners at risk of foreclosure by helping them trade high-cost loans with rapidly rising monthly payments for more-affordable mortgages backed by the Federal Housing Administration.” That little gift will cost as much as $300 billion.

Furthermore, nearly $4 billion will go to local governments to purchase and restore foreclosed properties; $4.6 billion will go to tax credits for first-time homebuyers; and $5.3 billion will go toward more low-income housing. Concerning the overall cost of this boondoggle, The Wall Street Journal said it best: “Even conservative estimates by the Congressional Budget Office say the cost for this bailout will run to $41.7 billion, with $16.8 billion offset by higher taxes. No one has any idea of the real cost.” What was that about “protecting the taxpayer” again?

Of course, missing amid all the furor over this behemoth bill is one simple question: Is it constitutional? (compiled and written by Mark Alexander)

Honestly, what ever happened to individual (and corporate) responsibility for ones actions. These people made poor financial decisions, I don't want to have to pay higher taxes and have less savings to put toward a down payment on my first home so that some bum can stay in his $800,000 home subsidized by Uncle Sam. Let them lose their homes and move into an apartment, maybe they'll learn not to buy what they can't afford. Now if there are not-for-profit organizations willing to assist some people get through these hard times more power to them, that is a very laudable endeavor; but that is not the government's responsibility.

Another thing that is really bugging me is how certain members of congress don't seem to have any common sense when it comes to the energy crisis in America. One of the biggest arguments I have heard coming from capitol hill against drilling in ANWR and off shore is "it won't even produce any oil for 10 years". First of all, one of the main reasons it would take so long is all of the federal loopholes that oil companies would have to jump through to start drilling. Second, experts are saying the drilling could go much quicker; and third, even if it does take ten years then all that really means is we should hurry up and drill. Are these politicians really that dumb? They said the exact same thing 10 years ago, and do they not think we will need oil in ten years? If all farmers had the same mindset as politicians (not doing anything without an immediate payout) then we could say goodbye to our food industry; these politicians are like the man lost in the desert who came upon a pump that needed to be primed and he had just enough water to prime the pump but instead of investing the water in the pump to get an unlimited amount he drank the water and died. They must not understand the way the oil industry works, that the price of oil is driven by future expectations of the price. All of these companies involved in the oil trade buy and sell futures, which means they estimate that cost of oil in the future and then lock in that price for a given amount of time. If it is determined that there will be a large increase in oil production then futures prices will decrease. And yet our "friends in Washington" don't seem to understand that ever so simple principle. Now they are proposing an increase in the gas tax and guess why; with the increase in oil costs people are buying less oil and the government's precious tax revenue is decreasing. Instead of increasing taxes thereby increasing fuel costs and decreasing consumption why don't they work on increasing supply thereby decreasing cost. I swear, if they would all just go to an Economics 101 class they would learn these basic principles.

In conclusion, I must reaffirm my love for this country and my belief (albeit hard to remember at times) that there are good men and women working in the government who understand these problems and the solutions available through the constitution.