Huffing HuffPo desperate for a GOP gaffe

By Michelle Malkin  •  September 8, 2008 01:12 PM

How desperate is the Huffington Post to point to an Obama/Biden-like rhetorical gaffe by Sarah Palin?

This desperate: (Hat tip: HA Headlines)

Gov. Sarah Palin made her first potentially major gaffe during her time on the national scene while discussing the developments of the perilous housing market this past weekend.

Speaking before voters in Colorado Springs, the Republican vice presidential nominee claimed that lending giants Fannie Mae and Freddie Mac had “gotten too big and too expensive to the taxpayers.” The companies, as McClatchy reported, “aren’t taxpayer funded but operate as private companies. The takeover may result in a taxpayer bailout during reorganization.”

Economists and analysts pounced on the misstatement, saying it demonstrated a lack of understanding about one of the key economic issues likely to face the next administration.

“You would like to think that someone who is going to be vice president and conceivable president would know what Fannie and Freddie do,” said Dean Baker, co-director of the Center for Economic and Policy Research. “These are huge institutions and they are absolutely central to our country’s mortgage debt. To not have a clue what they do doesn’t speak well for her, I’d say.”

The only ones without a clue here are the HuffPo’s Obama water-carriers.

As I wrote four years ago about the Fannie/Freddie racket:

Clothed in politically correct fashions (”Catch the dream,” beckons Freddie Mac’s program to boost minority home ownership; a “leader in diversity,” brags a Fannie Mae press release), these public-private hybrids are two dangerous pigs feeding at the federal trough. Congress created Fannie Mae (nickname for the Federal National Mortgage Association) in 1938 to bolster home ownership during the Depression. Three decades later, it was partially privatized, but retained a host of government benefits. In 1970, Congress spawned Freddie Mac (nickname for the Federal Home Mortgage Corp.) to provide a lending competitor to Fannie Mae. Both entities expand the pool of money for home purchasers by snapping up loans that lenders make to homebuyers, and then converting those loans into relatively safe mortgage-backed securities that are attractive to investors.

So, what’s wrong with this picture?

As Fred Smith, president of the Washington, D.C-based Competitive Enterprise Institute, has noted, these financial beasts are a textbook example of “profit-side capitalism and loss-side socialism.” When things go right for Freddie Mac and Fannie Mae, they keep the profits. But when things go wrong, taxpayers — not just private shareholders, managers, and employees — will be on the hook.
Freddie Mac and Fannie Mae each receive $2.25 billion lines of credit with the U.S. Treasury. These special pipelines give the institutions an implied federal guarantee available to no other private sector competitors in the mortgage market. That protection makes them immune to the costs normally associated with riskier and riskier behavior. Moreover, Fannie Mae and Freddie Mac are not required to pay state and local income taxes. In addition, the standard for how much money the government requires them to keep on hand in case homebuyers default on their mortgages is lower for Freddie Mac and Fannie Mae than for fully private banks and thrifts. The two corporations receive an estimated $10 billion a year in hidden taxpayer subsidies.

Political appointees to the companies’ boards pocket millions in stock options to bolster support on Capitol Hill. Clinton-appointed board members at Fannie Mae include Marc Rich lawyer Jack Quinn and Janet Reno’s lieutenant at the Justice Department, Jamie Gorelick. At the helm of Fannie Mae is another Clinton appointee, Franklin Raines, who was paid more than $4 million and had almost $6 million in unexercised stock options in his first year at the helm. Cheerleaders in both major political parties have opposed privatizing Fannie and Freddie.

Now, we are on the verge of bailing out these behemoths to the tune of $200 billion in taxpayer backing — while potentially forking over untold millions in severance packages to Democrat cronies.

That makes Palin in tune with reality — and her critics flailing once again.

Meantime, King of All Gaffes Obama has problems against with rewriting history:

O-Busted: Selective Service Requirement Did Not Exist When Obama Says He Registered

And the Biden Gaffe Clock keeps on ticking.

***

Peter Viles of the excellent L.A. Land real estate/biz blog: There is no gaffe here.

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  1. Hot Air » Blog Archive » Video: Hemmer sandbags Beckel over saying Palin will self-destruct
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  5. Left Swings and Misses on Palen, Freddie Mac and Taxpayers | 186 k per second
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  7. The Gaffe That Wasn’t… | Jeffrey A. Setaro
  8. Sarah Palin’s Attitude Lifts McCain Above Obama: « Riggword Weblog
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  20. When Government Fails, Blame the Private Sector | OpenMarket.org

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Comments


  1. #445660
    On September 8th, 2008 at 1:15 pm, thirteen28 said:

    Speaking before voters in Colorado Springs, the Republican vice presidential nominee claimed that lending giants Fannie Mae and Freddie Mac had “gotten too big and too expensive to the taxpayers.”

    After the Fed takeover 1 day after she said this, I find it hard to see where she screwed up. If anything, she was prescient, as Fannie and Freddie are most definitely costing taxpayers too much now.

  2. #445661
    On September 8th, 2008 at 1:15 pm, wise_man said:

    Gov. Sarah Palin made her first potentially major gaffe during her time on the national scene

    Don’t tell me, let me guess. She said:

    “My Muslim faith?”</blockquote>

  3. #445663
    On September 8th, 2008 at 1:17 pm, Jim M. said:

    Palinn was correct even without the bailout.

    The US government has always nodded to the “implicit” (or complicit?) guarantee of Gvernment Sponsored Enterprises like Fannie and Freddie.

    If the US government were a private company following generally accepted accounting practices, they would have to reflect the potential liability associated with the guaranty on its balance sheet. And it would be reflected as a liability, not as an asset.

    So, yes, the guarantee represents a potential taxpayer expense, and as we have seen today, that expense is now more than a “potential”.

  4. #445665
    On September 8th, 2008 at 1:18 pm, guitarplayer said:

    So now they’re going after her when she’s right? They are scared to death of her and are grasping at straws. I am so looking forward to the debates.

  5. #445667
    On September 8th, 2008 at 1:20 pm, Paul Revere said:

    her first potentially major gaffe

    Heh. That’s the equivalent of tennis commentators saying a player “would’ve hit a winning shot if the net hadn’t gotten in the way”.

  6. #445668
    On September 8th, 2008 at 1:20 pm, Defector01 said:

    not to mention since we’ve now taken over Fannie and Freddie, they are our responsibility and so it would cost too much for taxpayers

  7. #445670
    On September 8th, 2008 at 1:21 pm, meatpieandtatters said:

    Obama and Biden are both Gaffe-tastic.

    Sarah has nothing to fear. Anything she says will quickly be overshadowed by the script-addicted, off-the-cuff democrat dullards.

    :lol:

  8. #445671
    On September 8th, 2008 at 1:21 pm, Joy said:

    I’ll be looking for them to correct their misstatement

    Yah, I know…

  9. #445674
    On September 8th, 2008 at 1:22 pm, letget said:

    I have a feeling Sarah can balance a checkbook, could bho? Keep up the good work Sarah.
    L

  10. #445677
    On September 8th, 2008 at 1:23 pm, AlohaGuy said:

    Thanks Michelle, most people have no clue what Fannie and Freddie are, but most know the wallets are involved.

  11. #445687
    On September 8th, 2008 at 1:26 pm, Regulus said:

    The “Palin gaffe” meme is simply the Left’s way of reinforcing their own “common knowledge via rote repetition.” Most people won’t know the facts and won’t care; and those who do know will know it’s not the truth.

    But none of that will matter to the Left. All they want is to have their manufactured talking points to support their manufactured candidate.

  12. #445693
    On September 8th, 2008 at 1:28 pm, Gorebot said:

    It doesn’t matter what she says over the next two months, the leftwing lackeys in the Idiot Media will contort themselves without limit to make some of their toxic sludge stick to her.

    The only thing we NObamanators can do is prepare for these episodes whenever they occur, and then fire back without mercy.

    Getting OlberMatthews dismissed was a fabulous start!

  13. #445695
    On September 8th, 2008 at 1:29 pm, Goldwater Knight said:

    her first potentially major gaffe

    Thin. Real thin. Eggshells…

  14. #445697
    On September 8th, 2008 at 1:30 pm, sonofdy said:

    Please keep it coming. You are killing us!!! This will definately win obama the election!!! (insert manical laughter here)

  15. #445700
    On September 8th, 2008 at 1:31 pm, sonofdy said:

    Thin. Real thin. Eggshells…

    So far, its the best they have. Sad really, well for them.

  16. #445706
    On September 8th, 2008 at 1:34 pm, Paul Revere said:

    YES! Michigan is now officially a toss-up state with the latest PPP poll (democrat polling firm). The desperation will get deeper and deeper.

    POLLSTER.com

    I like pollster.com because they simply apply the numbers. They allow comments, and it’s funny reading Bambi’s supporters gulp and spin.

  17. #445709
    On September 8th, 2008 at 1:35 pm, Gorebot said:

    Meanwhile, NBC’s “In-Depth Investigation” by Brian Williams into the Ayers/Obama relationship is right around the corner. Yep, it sure is.

    Tick, tick, tick…

    You know, the one they’d do with the same intensity if McCain had ever worked with the Ku Klux Klan?

    Yeah, that one. Their report *must* be coming out any day now. Sure, yessiree.

    Tick, tick, tick…

  18. #445711
    On September 8th, 2008 at 1:37 pm, magicarb said:

    Thin. Real thin. Eggshells…

    Let’s keep Obama’s resume out of this…

  19. #445719
    On September 8th, 2008 at 1:40 pm, bloodhound said:

    There was a great moment on Fox News Sunday yesterday between Bill Kristol and Juan Williams. If someone can dig up a transcript… Anyway, in pertinent part, Juan was going off unhinged at Bill for McCain’s failure to address the FrMac & FaMae “crisis.” Bill with confident self satisfaction -smiling waits for a break in Juan’s tirade, and says ‘who has supported these for years?’ Juan begrudgingly says… ‘well, Democrats…. OK, I’ll give you that one.’ Snort!

  20. #445720
    On September 8th, 2008 at 1:40 pm, On-my-soap-box said:

    Did you see the gaff Obambi made in an interview with Geroge Snuffleupagus?

    Red State Update made an even bigger gaff with it HERE!

  21. #445723
    On September 8th, 2008 at 1:42 pm, Jim M. said:

    Fannie Mae is the much larger exposure to the US Taxpayer.

    The man at the helm of Fannie Mae until 2004 was Franklin Raines (we are not seeing the fallout from the activities of Fannie on his watch).

    Raines was a big donor to Democrats:

    http://www.newsmeat.com/ceo_political_donations/Franklin_Raines.php

    And he was rewarded in kind until Fannie was caught cooking their books:

    Former Fannie Mae chief Franklin Raines and two other top executives have agreed to a $31.4 million settlement with the government announced today over their roles in a 2004 accounting scandal.
    Raines, former Fannie chief financial officer Timothy Howard and former controller Leanne Spencer were accused in a civil lawsuit in December 2006 with manipulating earnings over a six-year period at the company, the largest U.S. financer and guarantor of home mortgages….

    Raines, a Seattle native and prominent Washington figure who was President Clinton’s budget director, is relinquishing company stock options, proceeds from stock sales and other benefits. His part of the settlement is worth $24.7 million,

    Raines’ total compensation from 1998 through 2004 was $91.1 million, including some $52.6 million in bonuses, according to OFHEO.
    http://seattletimes.nwsource.com/html/businesstechnology/2004358433_webraines18.html

    Raines left one hell of a contingent liability for the US to clean up while racking in huge amounts of compensation.

  22. #445735
    On September 8th, 2008 at 1:48 pm, iamsaved said:

    To paraphrase President Bush senior, can you see the thousand points of light going off? That’s the light bulbs in more and more citizen’s minds turning on about what Obama and the Dems really stand for.

  23. #445741
    On September 8th, 2008 at 1:52 pm, donnab13 said:

    Once again the liberal media makes her look like a genius.

  24. #445746
    On September 8th, 2008 at 1:52 pm, AlohaGuy said:

    Can someone please explain to me why Jamie Gorelick isn’t in jail?

  25. #445757
    On September 8th, 2008 at 1:55 pm, nyc123me said:

    Ha! Pot, kettle, black!
    You would like to think that someone who is going to be vice president would know how many states there are in the union. To not have a clue doesn’t speak well for Obama, I’d say.

  26. #445766
    On September 8th, 2008 at 1:59 pm, GladzKravtz said:

    And at the bottom of same post on HuffingtonPost.com page 1’s comments is an ad to buy a DVD titled “The God Who Wasn’t There”.

    “Irreverently lays out the case that Jesus Christ never existed.” – Newsweek……

    How pleased they must be…

  27. #445779
    On September 8th, 2008 at 2:04 pm, ackvil said:

    Meanwhile, the LA times reports on a Palin bounce in the polls.

  28. #445783
    On September 8th, 2008 at 2:05 pm, ackvil said:

  29. #445790
    On September 8th, 2008 at 2:08 pm, sambo said:

    Look at her other ‘first potentially major gaffe ‘ Campbell Brown had so much fun with this weekend. Brown was saying that Palin didn’t tell the truth about the jet, that it didn’t sell on eBay, and that it didn’t make a profit.

    Brown made a huge issue of this. But Palin said she ‘put it on eBay’. So these major gaffe’s are on the MSM, no one else.

  30. #445793
    On September 8th, 2008 at 2:08 pm, fred5676 said:

    Earlier this month in Oregon, he redrew the map of the United States: “Over the last 15 months, we’ve traveled to every corner of the United States. I’ve now been in 57 states? I think one left to go.”

    How about a Photoshop of a national red/blue state map with 57 states, just to keep reminding voters of Obama’s “potatoe”?? Have a contest to make up names for the additional 7 states??

    BTW as I remember the ‘potatoe’ story, the misspelled card was printed by the school and Quail initially questioned the spelling.

  31. #445796
    On September 8th, 2008 at 2:09 pm, secondsight said:

    When all is said and done, each will have gored the Treasury for $1T each. That’s $1,000,000,000,000 times two.*

    Look for a surge of California foreclosures in October just in time to make for bad headlines. California gave everyone an extra month leeway from when the notice of default, so stuff that should have cleared out in August was moved to September. Plus courts and bankers have been slow because they haven’t the staff or policies to handle the peaks, again these delays will make the situation look worse than it is.

    * I’m guessing of course but eventually we’ll see who’s righter.

    Har, if we still have internet, if we still have MM’s site, if we still….

  32. #445811
    On September 8th, 2008 at 2:15 pm, ThackerAgency said:

    This isn’t a gaffe. She’s right. It is too big and needs to be broken up (according to Greenspan – does he know anything about economics?)

    And per this weekend, taxpayers ARE on the hook for this albatross.

  33. #445816
    On September 8th, 2008 at 2:16 pm, joannmandolin said:

    Time for Obama to get his EXIT STRATEGY
    in place.

    Vote for Sarah and and all your wildest dreams will come true!!

    Is there a shirt out there, like the Napoleon Dynamite Vote for Pedro??
    I’d buy one!

  34. #445825
    On September 8th, 2008 at 2:20 pm, sonofdy said:

    Vote for Sarah and and all your wildest dreams will come true!!

    You mean I’ll get a brand new motorcycle and finaly get my damn orders from the army?

    waiting for the figmo moment.

  35. #445829
    On September 8th, 2008 at 2:22 pm, bigboy said:

    Geez guys…don’t know how you’ve brought Franklin Raines into this one…but everyone seems to be sleeping at the switch. Doesn’t everyone remember The One’s VP vetter Jim Johnson? Recently stepped down from Fannie Mae? Little scandal at the time…but now it appears that serious books were cooking under his watch.

  36. #445832
    On September 8th, 2008 at 2:22 pm, vickisoup said:

    I don’t know…I think the Obama military registration comment is a weak effort in the hunt for gaffes, in terms of its timing anyway. I tell the story of going on a cruise after high school graduation, which is true, and which took place a few months after I graduated. Am I lying? Is that a gaffe of mine? Well, ok, so be it.
    I’d rather focus on his comment that he “thought it” an enobling and honorable profession to enlist, as though in hindsight he now sees that was not the case, which I infer since he DID NOT enlist.
    And oh yeah…Sarah is correct about the lending “giants”.

    Country First
    McCain/Palin ‘08

  37. #445836
    On September 8th, 2008 at 2:24 pm, William Amos said:
  38. #445852
    On September 8th, 2008 at 2:34 pm, Member-VRWC said:

    “You would like to think that someone who is going to be vice president and conceivable president would know what Fannie and Freddie do,” said Dean Baker, co-director of the Center for Economic and Policy Research. “These are huge institutions and they are absolutely central to our country’s mortgage debt. To not have a clue what they do doesn’t speak well for her, I’d say.”

    Dean, please explain how what Gov. Palin said about Mae and Mac indicates she doesn’t have a clue what they do?

    To say that Mae and Mac, with all the special perks they were given in their charters, operated as private companies the way real private companies operate is fiction.

  39. #445860
    On September 8th, 2008 at 2:36 pm, cheapseat said:

    your analysis of profit capitalist – loss socialist is exactly true, and our country has been encouraging this thinking for a long time. when big business (airlines, automobiles, biofuels) make a profit, they get to keep it, when they take a loss, bankruptcy makes the taxpayer pay the bill. this is equally true of private citizens who run up debt, then run to some shyster to leave others to pay the bill. people build mcmansions on the coasts, houses in flood plains, homes in forests, then don’t adequately insure them and DEMAND the taxpayer make them whole over and over. yes, i know, insurers won’t insure homes on the coasts from hurricanes or homes in flood plains from floods, but why is that my fault and why should i pay. i hope mccain and sarah will tell these people get insurance or you are self insured!

  40. #445864
    On September 8th, 2008 at 2:38 pm, madchef said:

    On September 8th, 2008 at 2:22 pm, bigboy said:

    Geez guys…don’t know how you’ve brought Franklin Raines into this one…but everyone seems to be sleeping at the switch. Doesn’t everyone remember The One’s VP vetter Jim Johnson? Recently stepped down from Fannie Mae? Little scandal at the time…but now it appears that serious books were cooking under his watch.

    Franklin Raines replaced Johnson as CEO of Fannie Mae before he left to join the Obama campaign.

  41. #445869
    On September 8th, 2008 at 2:42 pm, madchef said:

    Raines left as CEO of Fannie in 2005.
    http://www.highbeam.com/doc/1G1-128602830.html

  42. #445877
    On September 8th, 2008 at 2:48 pm, Flyoverman said:

    Time for Obama to get his EXIT STRATEGY in place.

    The polls indicate that Obama has a failed strategy. This whole intervention into Presidential politics was ill-conceived and based on a lie. He is wasting campaign dollars that could be spent in more winnable races, as well as funding abortion clinics and ACCORN chapters. The “surge” of liberal women into the Presidential field to blunt Sarah Palin is simply a waste and a distraction from the real fight.

    I’d like to see a firm date for the withdrawl of these women and their redeployment, because Congress is the Central Front in the War on The Middle Class.

    Sorry, it’s been their line of **** so I thought it might influence them. :)

  43. #445879
    On September 8th, 2008 at 2:48 pm, DougT said:

    Here’s a quote from an NYT article by William Poole, a Cato fellow, back in July:

    The situation is similar to the one in the 1980s, when many savings and loans were technically insolvent yet had no difficulty attracting deposits, as they were covered by federal deposit insurance. So the federal government has the option of delaying any ultimate resolution of the Fannie-Freddie mess, as it did with the savings and loans 20 years ago, in hopes that the two giants can dig themselves out of the hole. Still, it seems more likely that — again, just as in the 1980s — the longer we delay, the higher the eventual taxpayer cost will be.

    Emphasis added.

    It pains me that Huffington is quoting another Cato fellow, Gerald O’Driscoll (and calling him conservative to boot.) It appears to be out of context and cut off before he could explain the concept noted in the quote above: that is, the longer we wait to act, the more it will cost the taxpayers.

    Fannie and Freddie are basically big, bloated, unnecessary mortgage insurance companies. On paper, they have no downside. As Michelle’s quotes point out, they’re backed by the taxpayer, so they really can’t lose.

    Yet somehow, some way, as only a government sponsored “private” corporation can, they’ve failed.

    Palin was right. Letting them continue would be too expensive for the taxpayers.

    Where I work, we are forced to put our liabilities on the balance sheet, just like we have to book payables when they occur. I notice only “economists and analysts” jumped on the gaffe-wagon. Maybe they needed to talk to a bookkeeper or an accountant. These private companies are too big and too expensive to the taxpayer.

    McCain needs to pounce and produce a plan to eliminate these two excuses for private businesses over the next five years.

  44. #445883
    On September 8th, 2008 at 2:50 pm, Member-VRWC said:

    Raines, a Seattle native and prominent Washington figure who was President Clinton’s budget director, is relinquishing company stock options

    As Glenn Beck poined out on his radio show this morning, the stock options were worthless. The strike price of the options was $77 / share. Current price is $9 / share and likely to go lower.

    Raines had no intention of exercising these options. Who would?

    So whatever value is ascribed to these options is completely bogus as it does not represent anything that Raines is paying as a penalty for his misdeeds.

    Other parts of Raines’ settlement package are also suspect. What this guy did was commit fraud on a scale that makes Enron look like chump change. Not saying Lay and Fastow shouldn’t have been hounded to the furthest corner of hell. They should have been. Just saying Raines should be joining them. Instead he gets a slap on the wrist. Whoever said crime doesn’t pay never met Mr. Raines.

  45. #445896
    On September 8th, 2008 at 2:56 pm, emjem24 said:

    Yet, HuffPo is all crickets about Obummer’s astounding gaffe fest? Color me surprised! :roll:

  46. #445905
    On September 8th, 2008 at 3:00 pm, lgm said:

    Gaffe in campaign ad: says Palin opposed the Bridge to Nowhere. She supported it almost until the end. She campaigned for it in Nowhere (whatever the town actually is called). There are photos of her on the web doing that.

  47. #445927
    On September 8th, 2008 at 3:08 pm, right_on said:

    Oh yeah…the CEPR is non-partisan…NOT! Take a look at the first four on it’s Board of Directors:

    Dean Baker He is frequently cited in economics reporting in major media outlets, including the New York Times, Washington Post, CNBC and National Public Radio. He is also strongly supported by…Daily Kos!

    Peter Barnes He is a former journalist who has written for Newsweek, The New Republic, The New York Times and many other publications.

    Julian Bond, Chairman, National Association for the Advancement of Colored People (NAACP)

    Jeff Madrick was contributing economics columnist for The New York Times. He is also a regular poster on The Huffpo blog.

    Lean to the left much?

  48. #445930
    On September 8th, 2008 at 3:10 pm, Socky said:

    Huffington Post commenter:

    I’m tired of banging my head against the wall trying to wake up a nation full of monkeys. You can have this place–I’ll stay in NYC as long as I can, and then I’ll head for Canada or Europe. I feel no kinship with 99% of the people who are allegedly my fellow Americans–they can have their god and their strip malls and their subdivisions and their commutes. Have a nice life….

    Yeah, they love “America,” it’s Americans they hate.

  49. #445935
    On September 8th, 2008 at 3:11 pm, bentman78 said:

    This was on Digg this morning…then again everything from the Bluffington Post seems to be. In any case, it’s been buried as inaccurate. I guess more and more conservatives and people with common sense are starting to use the site. What’s shocking is despite it’s inaccuracies, the Digg “commander” still leaves it on the front page.

  50. #445940
    On September 8th, 2008 at 3:13 pm, emjem24 said:

    Lgm:

    Please stay on topic. As to the Bridge to Nowhere… she heard from Alaskans about the project and she put the kibosh on it. What about that do you no understand?

    Keep on promoting those lies there, Math man. Not that Obummer has any problem with the truth such as he has no PAC/lobbyist money or lobbyists working for him (it’s only a sin if lobbyists are working for McCain), he was “interested” in the the military, and that he’s never sponsored any pork.

    Please, keep it up…. your defense of Obummer is wearing thin on the rest of us who know better.

  51. #445941
    On September 8th, 2008 at 3:13 pm, joannmandolin said:

    Flyover-

    I’d like to see a firm date for the withdrawal of these women and their redeployment, because Congress is the Central Front in the War on The Middle Class.

    For that to happen, this uber ethical lazya** congress would have to redeploy themselves from their Gustav cleanup efforts ski slopes, get off their Olbermann’s and put in a day’s work. They picked the wrong horse, again. It’s ok, they’re used to losing.

    My wildest dreams are coming true and I haven’t even voted for her yet!

  52. #445946
    On September 8th, 2008 at 3:17 pm, Jim M. said:

    Yes, Jim Johnson was certainly a model of the Obama vetting process.

    As CEO of Fannie Mae, Johnson, a former chief of staff to Vice President Walter F. Mondale and chairman of the board of the Kennedy Center, was the beneficiary of accounting in which Fannie Mae’s earnings were manipulated so that executives could earn larger bonuses. The accounting manipulation for 1998 resulted in the maximum payouts to Fannie Mae’s senior executives — $1.9 million in Johnson’s case — when the company’s performance that year would have otherwise resulted in no bonuses at all, according to reports in 2004 and 2006 by the Office of Federal Housing Enterprise Oversight…

    In a 2006 civil enforcement action against Fannie Mae, another agency, the Securities and Exchange Commission, called the company’s 1998 accounting “fraudulent” and said numbers were “intentionally manipulated to trigger management bonuses.”…

    Johnson left the company before it was swept up in an accounting scandal that tarred its reputation, but even during the years of scandal, Johnson was reaping hundreds of thousands of dollars in consulting fees and other compensation, $3.3 million in all between 2001 and 2006.
    http://www.washingtonpost.com/wp-dyn/content/article/2008/06/10/AR2008061003475_pf.html

    Fannie Mae was certainly a trough for Democrat payola:

    The two institutions have long been run not by bankers but by retired political figures, predominantly Democrats. From 1991 to 1998, Fannie Mae was headed by James Johnson, a longtime aide to former Democratic vice president Walter Mondale. Johnson’s successor, Franklin Raines, had served as budget director to Bill Clinton. Jamie Gorelick, vice chair of Fannie Mae from 1998 to 2003, served as deputy attorney general in the Clinton administration.

    These figures have paid themselves impressive private-sector salaries. Johnson earned US$21-million in just his last year at Fannie Mae. Raines earned US$90-million for five years’ work at Fannie Mae. Gorelick got US$26-million.

    And Jim Johnson truly turned Fannie into what it is today:

    Fannie Mae has always been run by power brokers. Its CEO in the 1980s was a savvy and extremely charming man named David Maxwell. He left two legacies. First, he rebuilt the company after its one brush with death in the early 1980s, when interest rates spiked and the payments on its mortgage portfolio didn’t cover the cost of its debt. Fannie survived in part because banks kept lending it money–based on the perception that the government stood behind it…

    Maxwell also put in place elements of the political and business machine Fannie would become. But it was his successor, Jim Johnson, who perfected the machine. The smooth, Princeton-educated son of a Minnesota politician ran Fannie for most of the 1990s. He had worked as an advisor to Walter Mondale and was a longtime member of the Washington establishment. Indeed, last year he headed Senator John Kerry’s search for a vice-presidential candidate and was rumored to be a top choice for Treasury Secretary in a Kerry administration–along with Franklin Raines. ..

    The cornerstones of the Johnson political machine were the Fannie Mae Foundation and the company’s Partnership Offices (”POs,” in Fannie parlance). The foundation had existed in a small form since 1979, but in 1996, Fannie Mae seeded it with $350 million of its own stock and gave it responsibility for Fannie’s advertising. Over the past five years the foundation has given away some $500 million to thousands of organizations ranging from the Congressional Black Caucus to the Cold Climate Housing Research Center in Fairbanks…

    Fannie began opening its Partnership Offices in 1994. These are regional offices that Fannie says act as catalysts for housing projects in their communities; but inside Fannie, the POs are also referred to as the “grassroots” of the political operation. They are frequently staffed by ex-politicos. (Bob Simpson, who heads the South Dakota office, was an aide to Democratic Senate leader Tom Daschle, for instance.) …

    Another reason for Fannie’s uncompromising attitude was Fannie executives’ continuing fear that what politics giveth, politics could take away–and their belief that Fannie’s congressional charter, which gave it so many advantages in the marketplace, had to be fought for at every turn. There was some truth to this. The Reagan administration, for instance, ideologically opposed to government-subsidized corporations, worked hard to privatize the company. (Fannie beat back the effort.) Fannie execs felt they couldn’t afford to lose even one fight, because that would open the floodgates. “You’re thinking survival–winning, not compromise,” says a former employee. A former Fannie lobbyist adds that the attitude was “Just win, baby.”

  53. #445948
    On September 8th, 2008 at 3:17 pm, Socky said:

    So, Palin changed her mind about supporting a government pork barrel project and ended up opposing and stopping it. It sounds like she moved in the right direction and should be praised for both doing the right thing and listening to her constituents.

    We need more people in power like her.

  54. #445956
    On September 8th, 2008 at 3:22 pm, Dan Lee said:

    The companies, as McClatchy reported, “aren’t taxpayer funded but operate as private companies. The takeover may result in a taxpayer bailout during reorganization.”

    These organizations are about as private as Bristol Palin’s pregnancy, which like these organizations only became “public” because of feverish Democrat efforts.

    They’ve been a black hole for tax payers for years..

  55. #445966
    On September 8th, 2008 at 3:27 pm, Bucklee said:

    LGM,
    Is that the best you can do? Or might it be that the talking points from “The One” have not been released so you are not sure what to say.

    And please remember no matter what “Hopium is your friend”.

  56. #445968
    On September 8th, 2008 at 3:27 pm, txvet2 said:

    On September 8th, 2008 at 1:52 pm, AlohaGuy said:

    Can someone please explain to me why Jamie Gorelick isn’t in jail?

    She’s a Democrat and former Clinton official. They should pretty much all be in jail.

  57. #445983
    On September 8th, 2008 at 3:35 pm, sonofdy said:

    LGM: After all the lies from the left about Palin, I would think you would start actualy checking what they say for yourself…

  58. #445987
    On September 8th, 2008 at 3:38 pm, joannmandolin said:

    Cuba is getting hit by Ike now,
    hope our guys at Gitmo are ok.

    Obama, how bout your guys at Gitmo?
    They ok?

  59. #445988
    On September 8th, 2008 at 3:38 pm, lgm said:

    emjem24 said:

    As to the Bridge to Nowhere… she heard from Alaskans about the project and she put the kibosh on it.

    Got any evidence for that? I thought the people of Alaska were for it.

  60. #446001
    On September 8th, 2008 at 3:46 pm, AlohaGuy said:

    Yeah, they love “America,” it’s Americans they hate.

    They keep saying they’re headed to Canada or Europe but they never leave.

  61. #446002
    On September 8th, 2008 at 3:46 pm, unseen said:

    I will repost this from hotair on the same subject:

    It would be nice if people understood what Fannie Mae and Freddie Mac do. They buy home loans from banks repackage those loans into security instruments like CDOs and SIV’s. They then take these bundled instruments and sell them on the open market (not only to Americian but too other countries like China russia, etc you know those countries that fund our run away spending). They can do this because before yesterday there has always been an implied backing from the Federal government and thus FM and FM were able to get money from the market below market rates. Thus they played the spread between market rates and the rates charged to them. They made money from this spread and from “fees” of selling the home loans packages.

    Now with homes prices dropping FM and FM have been unable to sell the home loans packages on the open market. There capital was being eaten up as the home loans built up on there books. With no capital they could not buy the loans from the banks and the banks could not sell their home loans and thus the banks capital was also being eaten up and thus no one was lending money leading to the credit crisis that has dropped the dow 3,000 pts, and increased the loss of home prices.

    With the takeover on Sunday the Americian taxpayer just got on the hook for $5 Trillion. I would say that is too expensive for the avg taxpayer. Regardless of that. The loss in stock market vaules of stocks, the loss of home equaity and the loss of jobs caused by this illiquid credit crisis caused in large part because of mismanagement of FM and FM also points to these insitutions being too expensive to the tax payer.

    Another smear by the left. McCain campiagn needs to knock this down now. Gov Palin was 100% correct on this issue. FM and FM are too big ($5trillion in home loans) and too expensive ($5 trillion tax libility, loss of stock market vaules, loss of jobs, loss of home equaity) for the tax payer.

    This is another example of why liberals should not be handed the keys to our economy. They have no idea what they are talking about.

    unseen on September 8, 2008 at 1:18 PM

  62. #446006
    On September 8th, 2008 at 3:47 pm, freeus said:

    Naval gazers!

    And I suppose these people were where when both of these behemoths were being created? And if she says, “yes we should bail them out”, then are they going to crucify her then or will the stoning begin after she says we SHOULD NOT bail them out? Which position on this are they taking? I cannot tell.

    Keep it up Lefties! You might should listen to Harold Ford Jr., but I for one hope you keep it up!

    Definition of barracuda-They are vicious predators and hunt using a classic example of lie-in-wait ambush!

  63. #446009
    On September 8th, 2008 at 3:49 pm, emjem24 said:

    lgm:

    Got any evidence for that? I thought the people of Alaska were for it.

    Do you have any evidence that she supported the Bridge to Nowhere to the bitter end? Another prevailing “theory” is that she gave the earmark a further looksee and decided that it didn’t pass the smell test.

    Are we going to play this game? There are Alaskans out there who didn’t like the corrupt, old boys’ club of Republicans running the show. If that hadn’t been the case, Gov. Murkowski would have been elected instead of Palin.

    I’ll leave you to provide neutral evidence supporting your assertion that Palin supported this earmark to the bitter end.

    One more thing: this comment of yours is quite revealing of the fact that liberals will suck up any earmark that will keep their political popularity high (oh, Obummer). Not every citizen is supportive of earmarks like say, me, a NY voter who didn’t support Hillary’s earmarking of a Hippy Museum.

  64. #446011
    On September 8th, 2008 at 3:50 pm, Flyoverman said:

    On September 8th, 2008 at 3:13 pm, joannmandolin said:

    …..They picked the wrong horse, again. It’s ok, they’re used to losing.

    When I read that, “I felt this thrill going up my leg.” :)

  65. #446014
    On September 8th, 2008 at 3:53 pm, Flyoverman said:

    Obama, how bout your guys at Gitmo?
    They ok?


    Take ‘em down to the beach.
    SURF’S UP!

    joannmandolin, you are making my day, here.

  66. #446016
    On September 8th, 2008 at 3:55 pm, AlohaGuy said:

    This is another example of why liberals should not be handed the keys to our economy. They have no idea what they are talking about.

    That’s because instead of studying Econ, they study junteenth and how to put a condom on a banana. Have we heard from Dumpster Muffin yet?

  67. #446019
    On September 8th, 2008 at 3:55 pm, Dan Lee said:

    I heard Matthews felt a tinkle going down his leg when he got called into the office to be demoted..

  68. #446021
    On September 8th, 2008 at 3:56 pm, AlohaGuy said:

    Take ‘em down to the beach. SURF’S UP!

    Waterboarding?

  69. #446025
    On September 8th, 2008 at 3:57 pm, ajmontana said:

    Obama IS the bridge to NOWHERE!!
    back under your rock lgm. troll.

    It’s Killin em and
    I Love it!!!

    McCain/Palin 08′
    Image: lgm underneath the Odopey bridge to la la land ducking from this weeks BUMP, unlike the TRICKLE for his master.

  70. #446026
    On September 8th, 2008 at 3:58 pm, Flyoverman said:

    Waterboarding?

    Kinky! I was actually thinking about the end of the movie, “Point Break.”

  71. #446030
    On September 8th, 2008 at 4:01 pm, ajmontana said:

    Hey, Michelle is on Cavuto. 8)

  72. #446036
    On September 8th, 2008 at 4:05 pm, Paul Revere said:

    Can the SuperDelegates change their minds…in a meaningful way? :D

  73. #446039
    On September 8th, 2008 at 4:06 pm, ajmontana said:

    Cavuto always is impressed by Michelle. 8)
    good job.

  74. #446043
    On September 8th, 2008 at 4:09 pm, Doo2 said:

    Crap, I missed it. I need to do a better job of watching FOX when I have pneumonia.

  75. #446049
    On September 8th, 2008 at 4:11 pm, NJ-Aviator said:

    lgm said:

    Gaffe in campaign ad: says Palin opposed the Bridge to Nowhere. She supported it almost until the end. She campaigned for it in Nowhere (whatever the town actually is called). There are photos of her on the web doing that.

    So I assume by your diversion to another subject, you agree with Ms. Palin on this FNMA and FHMC issue?

    Classic Liberal tactic. When it obvious you’re dead wrong… change the subject as quickly as possible.

    $10 billion a year with no upside for tax payers and the risk of sending the real estate industry further into the abyss…sounds too expensive for us.

    Very insightful that Sarah Palin.

  76. #446059
    On September 8th, 2008 at 4:18 pm, beenthere said:

    I had an idea this morning. I was thinking about all the wretched ugly stuff the democrats were throwing at Palin: Mayor of Loserville, no real experience compared to the mighty O, typical right-wing anti-abortion (they always say “women’s rights” to put whip cream on the turd), creationist backwoods goober who wandered out of the set of Deliverance II: Breeder’s Revenge . . . The whole shot in other words. Then it struck me: there is an opportunity here. There are three presidential debates scheduled. Why not change one of them to a Palin-Obama debate? The democrats are saying he would wipe the floor with her. Okay, let him show us how it is done. Let’s settle this like men. No more slurs, lies, and BS. One on One, that’s all we’re asking. The ball is in your court, guys.

    And if the Dems chicken out and get all huffy and morally superior, then we will have all the evidence we need to kindly tell them to . . . act like gentlemen henceforth.

  77. #446060
    On September 8th, 2008 at 4:19 pm, Goldwater Knight said:

    lgm said:

    Gaffe in campaign ad: says Palin opposed the Bridge to Nowhere. She supported it almost until the end. She campaigned for it in Nowhere (whatever the town actually is called). There are photos of her on the web doing that.

    The project was canceled in 2007 by bridge supporter Alaska Governor Sarah Palin, who changed her view after national public opinion turned against the bridge for being wasteful spending.

    Following the will of the people is a campaign gaffe?

  78. #446093
    On September 8th, 2008 at 4:33 pm, ajmontana said:

    Remember that game “pick-up-sticks?” that’s what the Dems are doing, they finally realize or have known since Hillary started smoking Obama that he is NOT “the one”
    Zero Obama. opps.

    It’s Killin em and
    I Love it!!!

    McCain/Palin 08′
    Image: Dems in total panic mode. buyers remorse bigtime! :shock:

  79. #446109
    On September 8th, 2008 at 4:40 pm, Southpaw said:

    I’ve read a lot about Fannie and Freddie and I still can’t figure out what they do. So, if Sarah Palin doesn’t know either, she’s got my vote.

  80. #446132
    On September 8th, 2008 at 4:58 pm, YTZGal said:

    Ah, according to the minions over at the HuffnPuff, anyone who doesn’t agree with them is a “Low Info Voter”.

    Palin gets in, which is why they are going nuts. She refuses to fit into the narrative they have bought into.

  81. #446135
    On September 8th, 2008 at 4:59 pm, joannmandolin said:

    Flyover,

    Cool Beans!

    Well, I thought I’d run with your
    ‘borrowing’ their cliche’s and catchy catch phrases.

    Howzabout this one?
    Sarah- She’s In it to Win it!!

    Speaking of the Great Cankled One, she is out today, stumping for the O. Not sure if they told her yet, but she didn’t get the nomination.

  82. #446148
    On September 8th, 2008 at 5:10 pm, ajmontana said:

    Newsflash!
    Obamalama ding dong now invented the word change and no touchy for you!!!

    lmao.

    It’s Killin em and
    I Love it!!!

    McCain/Palin 08′
    Image: next he’ll claim fame for Elvis! 8)

  83. #446181
    On September 8th, 2008 at 5:42 pm, TheOtherSide said:

    Freddie Mac and Fannie Mae each receive $2.25 billion lines of credit with the U.S. Treasury.

    But they have never drawn down on these lines of credit. So again, how are they “too expensive to the taxpayers”?

    No wonder the McCain camp won’t let her be interviewed.

  84. #446183
    On September 8th, 2008 at 5:42 pm, BlameAmericaLast said:

    They keep saying they’re headed to Canada or Europe but they never leave.

    A long time ago, I even offered to pay for those one way tickets. And no one asked.

  85. #446184
    On September 8th, 2008 at 5:43 pm, BlameAmericaLast said:

    It’s it telling that Obama is now on the campaign trail criticizing Palin? Isn’t he supposed to be going after McCain?

  86. #446186
    On September 8th, 2008 at 5:46 pm, RabbidSquirrel said:

    Huffington Post commenter:

    I’ll stay in NYC as long as I can, and then I’ll head for Canada or Europe. I feel no kinship with 99% of the people who are allegedly my fellow Americans–they can have their god and their strip malls and their subdivisions and their commutes. Have a nice life….

    Thanks for stopping by!!!! Talk to you later.

    ::holding fake phone to ear, dialing obsolete phone with other hand::
    Call me!!!

    (hey everyone! theres an apartment vacancy opening up in the city soon…)

  87. #446195
    On September 8th, 2008 at 5:53 pm, TheOtherSide said:

    On September 8th, 2008 at 4:19 pm, Goldwater Knight said:

    The project was canceled in 2007 by bridge supporter Alaska Governor Sarah Palin, who changed her view after national public opinion turned against the bridge for being wasteful spending federal dollars for the project were pulled back and diverted to other uses in Alaska.

  88. #446197
    On September 8th, 2008 at 5:58 pm, ajmontana said:

    and how’s this one workin for ya Other Side??? lmao

    1. On August 30th, 2008 at 12:26 pm, TheOtherSide said: Wow, finally something you Malkinites and us Obama supporters can agree with. We are both happy with Palin as the VP pick. Watch the polls in the next month…you will find that this was an incredibly poor choice.

    I’m watchin…. ha!!!

  89. #446198
    On September 8th, 2008 at 5:59 pm, Hannibal said:

    On September 8th, 2008 at 2:22 pm, vickisoup said:

    I don’t know…I think the Obama military registration comment is a weak effort in the hunt for gaffes, in terms of its timing anyway.

    Yeah Vick, you’re probably right. It didn’t mean a heck of a lot in 1979 or 1980 or whatever. Why would he remember? Now, if he would have turned 18 in the late 60’s or early 70’s it would have carried a little more weight. We can still tell you exactly when we signed up for the Selective Service, what our lottery number was, what month we took our physical, and who the jackass was that headed up the local draft board. Seemed to have more meaning back then, slightly higher up on the priority list. Every guy’s wallet had a driver’s license, a condom, and a Selective Service Card.

    Be courageous
    Vote Present in ’08
    sarc/off

  90. #446199
    On September 8th, 2008 at 6:00 pm, ajmontana said:

    It’s Killin em and
    I Love it!!!

    McCain/Palin 08′
    Go Sarah Go!!!

  91. #446200
    On September 8th, 2008 at 6:01 pm, Flyoverman said:

    Howzabout this one?
    Sarah- She’s In it to Win it!!

    It rocks! This morning I thought of a great t-shirt for us “Sarah Guys” given what Gloria Steinem said:

    Guys for Sarah

    “Sarah Palin shares everything BUT a chromosome with me”

    Put a little DNA strand below it!

  92. #446208
    On September 8th, 2008 at 6:14 pm, TheOtherSide said:

    On September 8th, 2008 at 5:58 pm, ajmontana said:
    and how’s this one workin for ya Other Side??? lmao

    I’m watchin…. ha!!!

    Keep watching ajmontana. I believe the McCain ticket has reached the peak of the bounce and it’s all downhill from here. Get back to me at the end of September and we will see who’s laughing. In the meantime, go Angels!

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