Government Policy Got Us Into the Subprime Mess

The Clinton administration and its liberal allies in the Congress pushed this CRA BS down the throats of the lenders and this is the story the McCain campaign should be telling the voters.

Although I wrote the following in response to a NASA post it is has some great information regarding the budget.

OK, let’s get real.
NASA budget is 0.6% of the total budget ($16 Billion a year)and spin offs (see this page for spin offs http://www.sti.nasa.gov/tto/) do create a modest social return on investment.

$16 Billion sounds like a lot until you look at Social Welfare programs. Take for example Health and Human Services (can you say welfare?) Which is the LARGEST portion of the budget pie with a FY 2008 estimate of $700+ Billion. What’s the return on investment for this $700 Billion part of the budget? NOTHING, unless you count politicians gaining in popularity with the unwashed “something for nothing” masses (read increased socialism).

The Department of Defense is next at approx. $620 Billion closely followed by Treasury Department Interest on the Debt at approx $510 Billion. Lets not forget the Department of Education which in IMHO does absolutely NOTHING and should be done away with but, has a budget of approx. $80 Billion (or more than 3 times the NASA budget!)

The graph I reference with the above numbers is located at:
http://www.federalbudget.com/

Now anyone with a lick of common sense can figure out where the real waste is in government. Problem is nobody puts things in perspective and the MSM is the most culpable of all.

So, in summary NASA is not the drain on the budget by a long shot but social spending and government (by the way you do remember that “we” are the government) misspending is the real problem.

We need to break out those painful to look at Ross Perot charts and make people see the budget problems for what they are.

So, what's the government answer to today's failed government social experiment touted as a great accomplishment years past because of it's easy lending to minorities? Of course a multi-billion dollar bail out!

Makes sense, I guess. I think like in Europe what we should do is “TAX” those firms and individuals that are successful and economically viable across the board more so that we can subsidies dead industries and unproductive people with billion dollar injections so we can feel good about ourselves and the social experiments we're funding. We all know, Europe is such a great model to emulate, right? High unemployment rates, low growth, lower wages, and standing in lines for green cards to get over here, there are some who think we could do nothing better than copy failed social-democratic theory. And while even here we have a long tradition with centralist thinking with institutions like Social Security, the Veterans Administration, etc. these illusions of grandeur that somehow everything will suddenly get better if people abdicate their power to a government which will run things for them, persist.

Nicely stated BTTT!

It’s absurd to attack financial institutions for making loans the government demanded. What are they supposed to do?

Now the liberal Democrats are asking us to create more entitlements. What will be the ultimate fallout, or bail out, for those programs?

More socialism?

It’s absurd to attack financial institutions for making loans the government demanded. What are they supposed to do?

While it is undoubtedly true that many low income people got loans they could not afford, it is also true that a huge number of middle class people with solid middle class jobs got $600,000 "Interest Only" mortgages that they could barely afford the "interst only" monthly payments on in order to pay $600,000 for a $300,000 house.

MAY 18, 2005 ... A Growing Tide of Risky Mortgages .... Here are some scary statistics: In 2004, fully 50.4% of the mortgage loans issued for purchases of single-family homes in Georgia were to pay interest only. That made the Peach State No. 1 in the nation in its share of interest-only mortgages. But a whole bunch of other states were not far behind: California was second, at 47.1%, Colorado third, at 45.5%, Nevada fourth, at 44.7%, and the District of Columbia, fifth at 43.8%. ..... Lenders that make interest-only loans argue that there's little risk of a wave of defaults as long as the economy remains reasonably strong and housing prices don't crash. But even some parties that benefit from the rage for interest-only mortgages, like homebuilders, are wondering if the trend may have gone too far. "In most of those cases, buyers have no idea how they're going to pay" the higher payments that will be owed once principal payments begin, says William J. Pulte, founder and chairman of Pulte Homes

I predicted the current mess and posted that very same link on Free Republic back in 2005.

49 posted on Wednesday, June 22, 2005 2:28:10 PM by Polybius

35 posted on Wednesday, June 22, 2005 12:17:19 PM by Polybius

Read over that old FR thread and you will see that those who warned against this madness were labelled "doom and gloomers".

Your observations may need repeating at this thread:

http://www.freerepublic.com/focus/news/2086591/posts?page=2