Getting it and getting away with it 0

Investor’s Business Daily reports that Alan Greenspan “gets it” – which should not come as a surprise considering he was Chairman of the Federal Reserve for nearly 20 years – and recaps what happened that made America and the world poorer.

Testifying before the Financial Crisis Inquiry Commission, the former Fed chairman told some plain truths he didn’t dare utter when he headed the central bank. Most notably, Greenspan implied it was Congress’ meddling incompetence — not the Fed, or free markets, or greedy bankers — that created the financial meltdown. …

It wasn’t the Fed that caused the housing crash and financial meltdown. It was Congress and the White House.

The mess began in the 1970s when, during the Carter administration, left-wing activists attacked banks for supposed “redlining” practices that let them discriminate in making home loans.

In response, Congress passed the Community Reinvestment Act, which gave regulators the power to force banks to lend money to “low-income, minority, and distressed neighborhoods.”

To fund all this new lending, they used two little-known government-sponsored enterprises — Fannie Mae and Freddie Mac — and essentially rewrote credit standards for the banks, weakening them substantially. Banks made loans, then Fannie and Freddie bought them — using borrowed money to do it.

In this environment, credit ratings no longer mattered much. Neither did having a job or a steady income. What mattered was race.

The process got supercharged in 1992, when a Democrat-led Congress pushed Fannie and Freddie to buy even more mortgages from banks that had made loans to low-income and minority buyers. In 1996, President Clinton’s Department of Housing and Urban Development told Fannie and Freddie that 42% of their financing had to go to those with incomes below the median.

By 2000, HUD [Department of Housing and Urban Development] Secretary Andrew Cuomo proudly unveiled “new regulations” to “provide $2.4 trillion in mortgages for affordable housing for 28.1 million families.” Despite subsequent efforts at reform, Democrats in Congress — led by Sen. Chris Dodd and Rep. Barney Frank — rejected major changes to Fannie and Freddie.

We’re still paying for that today. Fannie and Freddie have gotten a blank check from the government for their losses, and still owe more than $5 trillion that they can’t pay off.

We’ve been critical of Greenspan in the past, but on this, he’s completely right. The biggest villain in the whole financial meltdown isn’t the “private sector,” as some in Congress — like Rep. Frank — have tried to claim. It’s Congress itself.

Shouldn’t those responsible, notably Chris Dodd and Barney Frank, be made to answer for the world-size wreck? What they’ve done to the economy makes Bernie Madoff’s crooked scheme look paltry.

If it’s not to find who is guilty, so that the culprits may be consigned to their just deserts, what is a Financial Crisis Inquiry Commission for?

Dalia’s advice 0

There is yet another subversive adviser in the White House.

From the Telegraph:

Miss [Dalia] Mogahed, appointed to the President’s Council on Faith-Based and Neighbourhood Partnerships, said the Western view of Sharia was “oversimplified” and the majority of women around the world associate it with “gender justice”.

The White House adviser made the remarks on a London-based TV discussion programme hosted by Ibtihal Bsis, a member of the extremist Hizb ut Tahrir party.

The group believes in the non-violent destruction of Western democracy and the creation of an Islamic state under Sharia Law across the world.

Miss Mogahed appeared alongside Hizb ut Tahrir’s national women’s officer, Nazreen Nawaz.

During the 45-minute discussion, on the Islam Channel programme Muslimah Dilemma earlier this week, the two members of the group made repeated attacks on secular “man-made law” and the West’s “lethal cocktail of liberty and capitalism”.

They called for Sharia Law to be “the source of legislation” and said that women should not be “permitted to hold a position of leadership in government”.

Miss Mogahed … said: … “The majority of women around the world associate gender justice, or justice for women, with sharia compliance.” …

Miss Mogahed admitted that even many Muslims associated Sharia with “maximum criminal punishments” and “laws that… to many people seem unequal to women,” but added: “Part of the reason that there is this perception of Sharia is because Sharia is not well understood and Islam as a faith is not well understood.” …

Miss Mogahed, who was born in Egypt and moved to America at the age of five, is the first veiled Muslim woman to serve in the White House. Her appointment was seen as a sign of the Obama administration’s determination to reach out to the Muslim world. …

During this week’s broadcast, she described her White House role as “to convey… to the President and other public officials what it is Muslims want.” …

What Muslims want? Such as ‘the destruction of Western democracy and the creation of an Islamic state under Sharia Law across the world’?

Of course, the more we understand about Islam and Sharia, the more we are likely to admire them. Or possibly not.

But we have no doubt at all that the President is listening sympathetically to Dalia’s advice.