DC Theater

9/22/13

Sometimes I almost feel sorry for the Republicans.  The Democrats are about to beat ‘em like a drum, and it seems like everybody knows it, even a few Republicans.

The occasion is the annual raise-the-debt-ceiling charade, in which the party not holding the presidency threatens  to block the debt-ceiling increase unless some demand is met.  This year the House of Representatives, controlled by the Republicans, just voted to defund ObamaCare. There is no chance this will get through the Democrat controlled Senate. Even if it did, the President would veto it. Furthermore, any attempt to tie defunding ObamaCare to raising the debt ceiling is guaranteed to backfire.

The President, more than once, has demanded Congress pass a debt ceiling increase without any conditions. None. Nada. The man is not for compromising.  In fact, he is daring the Republicans to not raise the debt ceiling.  He will then shut down the government and we‘ll see pictures of starving babies, uncollected garbage, shuttered hospitals, old people in overturned wheelchairs and military personnel selling pencils on street corners. All the fault of the uncaring, obstructionist Republicans.

It’s like watching Lucy and the football, only it’s not Lucy holding the ball, it’s President Obama, and it’s not Charlie Brown, but the Republicans who are about to land on their butt.

Advice to the Republicans: (1) Pick fights you can win.  (2) When picking a fight with a president, remember the president has what Teddy Roosevelt called a “Bully Pulpit“ and a Democrat president has the slavish backing of the mainstream media to amplify and endlessly repeat his “Bully Pulpit” sermons.

There is no question that ObamaCare is going to be a disaster. The operative words are “going to be.”  Let it rot on the vine for a couple of years, get nice and  foul, and then prune it off.  In the meantime, why not go after government programs that have a proven record of failure?

If the Republicans want to use the debt ceiling to put the spotlight on some much needed budget cuts, they could start by demanding the elimination of the Department of Housing and Urban Development, HUD.  No government agency in the history of America has caused more damage, with the possible exception of the Federal Reserve.  This is a story the American public needs to know.

HUD was at the heart of the 2008 recession, one of our worst ever.  For over two decades, HUD not only encouraged but REQUIRED irresponsible home mortgage lending, unchecked by either Republican or Democrat administrations, but especially encouraged by Democrats, a few of whom became multimillionaires in their GOVERNMENT jobs.

The concept of “claw back”, in which profits from illegitimate enterprises are recovered by the courts, even from innocent participants, is something that the Republicans should explore. This happened to innocent investors in Bernie Madoff’s Ponzi scheme, some of whom got out with profits only to have those profits confiscated years later by the courts.

Why not the same for those who received millions from Fannie Mae and its sister GSE, Freddie Mac?  Ever heard of Franklin Raines?  Jamie Gorelick?  James Johnson?  There are probably many others, but those three Democrats come to mind as people who walked away from government jobs with many millions of dollars in their pockets, dollars from the illusory profits of their employer, Federal National Mortgage Corporation, a.k.a. Fannie Mae, the GSE run by HUD.

The best summary I’ve seen of this sorry situation was an editorial in the Wall Street Journal September 17, 2013, by Peter Wallison: “Five Years Later, Don’t Mention the Feds. Washington and the media are peddling a narrative that discounts the government’s role in the financial crisis.”  I would say it’s more like hiding the government’s role.

For a more thorough analysis, read “Reckless Endangerment” by Gretchen Morgenson, (Times Books, 2011.)  Morgenson is assistant business and financial editor for The New York Times, which should give her credibility with the “Government is God” crowd.

The bottom line is that HUD, 2012 budget of $37 billion, should be abolished. In fact, all of the federal government’s housing support activities should be abolished. The Constitutional justification for such activity is weak to nonexistent. In addition, some people should go to jail, including former and current members of the House and Senate. (See page 187 of Reckless Endangerment.)

It will never happen because the Republicans don’t want to rock the government boat.  And they wonder why there’s a TEA Party.

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