At a press conference today Sarah Palin said: “And that’s why John McCain has been calling for years to reform things and cut bureaucracy even at the lending agencies our government supports. The fact is that Fannie Mae and Freddie Mac have gotten too big and too expensive to the taxpayers. The McCain / Palin administration will make them smaller, and smarter, and more effective for homeowners that need help.”
The thing is … Fannie and Freddie aren’t taxpayer supported! They’re independent corporations. Here we are in the middle of a major housing crisis and the Republican candidate for Vice President doesn’t have the first clue of how the system operates.
She could have said: “The government shouldn’t be in the mortgage business at all! We should shut down Fannie and Freddie and leave this sort of thing to the free market.”
Or she could have said: “If the government is going to back up Fannie and Freddie with public funds we need more oversight! The McCain / Palin administration will make sure regulations are in place to prevent the sort of irresponsible lending that got us into this mess.”
But saying that Fannie and Freddie are too expensive to taxpayers? That the problem with them is too much bureaucracy? That’s just mind-numbingly stupid … .
You miss the point. The point is that Obama doesn’t have the kind of experience in international relations and executive military command that Palin has on her record.
Jeez, we’re in the middle of a war to save America from the terrorists and you’re worried about a teensy weensie little financial crisis? What, do you want the terrorists to win?
Fannie Mae and Freddie Mac have always been taxpayer supported in that it was understood that they would be bailed out by the taxpayer if anything happened. This covering of downside risk gave them an advantage in terms of attracting money. The top levels of bureaucracy had been pushing them to expand their market share in sub-prime loans. Had they stayed smaller and refused to take out riskier loans, they would not be in the mess they are currently in. Palin is partially correct.
For a good background on this read Arnold Kling’s essays at econlog.
I realize that it’s de rigeur here at the tolerant and fair-minded SDMB to immediately assume to worst possible interpretation of anything containing the substring PALIN.
Nonetheless, I think it bears mentioning that the last line of the paragraph that quotes Governor Palin says:
Given that she was not not delivering a prepared paper, and a certain amount of less than academic rigor may be found in her comments, is it barely possible she meant that the likelihood of a federal bailout during this forced “receivership” is what would be expensive for the taxpayers?
I disagree. From my reading, Palin implied that McCain has been lobbying for years to trim down the taxpayer-funded organization of the mortgage guarantors. This is what is criminally stupid, as they are not government agencies. The government was always assumed to be the bearers of the FM risk, but the organizations themselves were up until now completely private. McCain had no more power to lobby for them to be trimmed down than he could lobby to have people laid off at Microsoft.
Doesn’t seem mind-numbingly stupid to me. There has been an implied government guaranty of both entities. This implied guaranty would presumably be taxpayer backed.
I realize it’s de rigeur for you to fling out blanket insults towards the Democrats on this board, but would it be so hard for you to contain it to the Pit? You know, we rude and knee-jerk libruls aren’t the only ones who take issue with, and see serious problems with what she said.
It’s refreshing to see a high-profile Republican acknowledging that from time to time, the federal government has to step in and make adjustments to the free market economy in order to improve its efficiency. I wish the McCain/Palin administration the best of luck in making these lending agencies “smaller, smarter, and more effective,” and hope my conservative friends will join me in welcoming the day when they can similarly turn their attention to the transportation, health care, and energy industries.
Would you guys PLEASE stop alerting Palin to the major gaps in her knowledge? I’d like Joe Biden to point out all her foot-in-mouth remarks sequentially next month, all at once.
Wait, how long is that debate? What? Biden has only that long to speak, and then turn his time over to Palin to explain herself? Okay, proceed, then. No harm, no foul.
Sure, if you think verb tense means nothing, or that it was a misspeaking not a lack of knowledge. She said: “The fact is that Fannie Mae and Freddie Mac have gotten too big and too expensive to the taxpayers.” Generally, “have gotten” refers to a past occurrence, not a future possibility.
I’m sure it is possible that she’s extremely well informed about the banking crises, the War in Iraq, and the myriad of other things we don’t know about her. And I suppose she could have meant “have gotten too big and [will be] too expensive to the taxpayers.”
I just think those possibilities fly in the face of common sense.
The plain reading of Palin’s quote is that she believes Fannie and Freddie to have been funded by the taxpayers. She’s not referring to a bailout, or the guarantee of a bailout. She’s plainly saying that historically they have cost the taxpayers money, and it’s gotten to be much.
I’m sympathetic to gaffes, especially from someone in the middle of a crash course on federal issues, but let’s not kid ourselves that it wasn’t a gaffe.
And to support your claim that you liberals aren’t the only ones who take issue with her comments, you provide a cite to mnpublius.com, which is a reasonably politically neutral collection of reports and blogs.
“The Nation on Coleman’s Campaign Conflicts.” (For those unaware, Coleman is the Republican Senator from Minnesota).
“Norm Coleman’s Head in the Sand.”
“Mad Magazine Runs Ad for McCain/Palin.”
Frankly, and intending no disrespect to any posters here, I would say that “rude, knee-jerk liberals” pretty well describes the population at mnpublius.com. And for this reason, I do not believe it supports either:
a. Your claim “we rude and knee-jerk libruls aren’t the only ones who take issue with, and see serious problems with what she said.”
b. Your implied claim that her statement was unambiguously wrong or indicates any lack of understanding.
c. Your implied claim that neutral economists are in general agreement that her statement is in error.
I’ll get right on that. I expect to be done some time after you heed the advice of your fellow Democrat Joe Liberman.
Soon she’ll make a mistake that clearly shows she isn’t ready for the job. You guys defending her are going to have a much harder time defending her actions in the future, I feel. If they get elected you know how it’s going to end. We could easily dig up quotes by ex-Bush-now-Palin supporters giving Bush the same generous benefit of the doubt.
Why the GOP want more “shoot-from-the-hip” cowboy types still is pretty much beyond me. They fall for it again and again, and the country loses. How about you choose people who take a sober and measured assessment of the situation? What the hell is wrong with that? The world is a bit more complicated than an effing John Wayne western.