Letters to the Editor
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Is the current 'credit crisis' like that of the great 'savings and loan crisis'?
I'm wondering if there are any marked similarities between the 'savings and loan debacle' and the current 'credit crisis'.
A quick loot at the savings and loan crisis in wikipedia sets the tone and dates of this manufactured 'crisis'.
Imprudent real estate lending
In an effort to take advantage of the real estate boom (outstanding US mortgage loans: 1976 $700bn; 1980 $1.2tn) and high interest rates of the late 1970s and early 1980s, many S&Ls lent far more money than was prudent, and to risky ventures which many S&Ls were not qualified to assess. L. William Seidman, former chairman of both the FDIC and the Resolution Trust Corporation, stated, "The banking problems of the '80s and '90s came primarily, but not exclusively, from unsound real estate lending."
And guess who was involved, up to his neck! John McSame McCain!
The Lincoln Savings led to the Keating five political scandal, in which five U.S. senators were implicated in an influence-peddling scheme. It was named for Charles Keating, who headed Lincoln saving and made $300,000 as political contributions to them in the 1980s. Three of those senators - Alan Cranston, Don Riegle, and Dennis DeConcini - found their political careers cut short as a result. Two others - John Glenn and John McCain - were rebuked by the Senate Ethics Committee for exercising "poor judgment" for intervening with the federal regulators on behalf of Keating.
My goodness... The occupant of the straight bullshit express? Involved in fleecing America?
And the Bush family?
Silverado Savings and Loan
Silverado Savings and Loan collapsed in 1988, costing taxpayers $1.6 billion. Neil Bush, son of then Vice President of the United States George H. W. Bush, was Director of Silverado at the time. Neil was accused of giving himself a loan from Silverado, but he denied all wrongdoing.
The US Office of Thrift Supervision investigated Silverado's failure and determined that Bush had engaged in numerous "breaches of his fiduciary duties involving multiple conflicts of interest." Although Bush was not indicted on criminal charges, a civil action was brought against him and the other Silverado directors by the Federal Deposit Insurance Corporation; it was eventually settled out of court, with Bush paying $50,000 as part of the settlement, as reported in the Washington Post.
Silverado's collapse cost taxpayers $1 billion.
Déjà vu all over again?
Who is making the big money besides Country Wide's ex-CEO?
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Conclusion, interesting...
Consequences
While not part of the Savings and Loan Crisis, many other banks failed. Between 1980 and 1994 more than 1,600 banks insured by the Federal Deposit Insurance Corporation (FDIC) were closed or received FDIC financial assistance. [15]
During the Savings and Loan Crisis, from 1986 to 1995, the number of US federally insured savings and loans in the United States declined from 3,234 to 1,645. [16] This was primarily, but not exclusively, due to unsound real estate lending.[17]
The market share of S&Ls for single family mortgage loans went from 53% in 1975 to 30% in 1990.[18] U.S. General Accounting Office estimated cost of the crisis to around USD $160.1 billion, about $124.6 billion of which was directly paid for by the U.S. government from 1986 to 1996. [19] That figure does not include thrift insurance funds used before 1986 or after 1996. It also does not include state run thrift insurance funds or state bailouts.
The concomitant slowdown in the finance industry and the real estate market may have been a contributing cause of the 1990-1991 economic recession. Between 1986 and 1991, the number of new homes constructed dropped from 1.8 to 1 million, the lowest rate since World War II. [20]
A taxpayer funded government bailout related to mortgages during the Savings and Loan crisis may have created a moral hazard and acted as encouragement to lenders to make similar higher risk loans during the 2007 subprime mortgage financial crisis.
Interesting...
http://en.wikipedia.org/wiki/Savings_and_Loan_Crisis
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Ron Paul
http://www.lewrockwell.com/paul/paul443.html
Before the US House of Representatives, March 13, 2008
It has been said that "he who lives by the sword shall die by the sword." And in the case of Eliot Spitzer this couldn’t be more true. In his case it’s the political sword, as his enemies rejoice in his downfall. Most people, it seems, believe he got exactly what he deserved.
The illegal tools of the state brought Spitzer down, but think of all the harm done by Spitzer in using the same tools against so many other innocent people. He practiced what could be termed "economic McCarthyism," using illegitimate government power to build his political career on the ruined lives of others.
No matter how morally justified his comeuppance may be, his downfall demonstrates the worst of our society. The possibility of uncovering personal moral wrongdoing is never a justification for the government to spy on our every move and to participate in sting operations.
For government to entice a citizen to break a law with a sting operation – that is, engaging in activities that a private citizen is prohibited by law from doing – is unconscionable and should clearly be illegal.
Though Spitzer used the same tools to destroy individuals charged with economic crimes that ended up being used against him, gloating over his downfall should not divert our attention from the fact that the government spying on American citizens is unworthy of a country claiming respect for liberty and the fourth amendment.
Two wrongs do not make a right. Two wrongs make it doubly wrong.
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CCIA
Remember the letter from the Computer & Communications Industry Association that said retroactive immunity was a bad thing? Here's a reminder:
CCIA represents an industry that is called upon for cooperation and assistance in law enforcement. To act with speed in times of crisis, our industry needs clear rules, not vague promises that the U.S. Government can be relied upon to paper over Constitutional transgressions after the fact. !!
CCIA dismisses with contempt the manufactured hysteria that industry will not aid the United States Government when the law is clear. As a representative of industry, I find that suggestion insulting. To imply that our industry would refuse assistance under established law is an affront to the civic integrity of businesses that have consistently cooperated unquestioningly with legal requests for information. This also conflates the separate questions of blanket retroactive immunity for violations of law, and prospective immunity, the latter of which we strongly support.Link: http://www.ccianet.org/artmanager/uploads/1/HouseFISAletter022908.pdf
Gosh, imagine my surprise when I checked on the membership of CCIA. This seems like the perfect group for AOL/TimeWarner to belong. Wrong! Here's the membership, and they don't belong:
http://www.ccianet.org/members.html
Shocked, just shocked I am.