Friday Follies for February 10, 2012

This lawless administration. A topic on the radio this morning brought that thought to mind.  The democrats and specifically the Obama administration have been, and are being, instrumental in the demise of the the Rule of Law.  Note the capital letters.

This country is based on this concept. It has worked for more than 235 years. Until now.

In 2009 and continuing through 2011, the government effectively nationalized General Motors and Chrysler.  The existing Board of Directors were forced out and replaced by government selected surrogates.  When it came time to pay off the debts, the bond holders, those who by law were to be paid first, were ignored. That violated the law.  The stockholders, those who had invested in those corporations were ignored and stock issued to unions and those favored by government effectively removing the original stakeholder from control of the companies.  Another violation.

The concept of contract law was ignored by Fannie Mae and Freddie Mac when they forced mortgage companies to issue loans to those known to be unable to repay.  The contracts issued under pressure from government were then ignored under pressure from government on the lender. The concept of the contract—that one side of the contract, in this case a reasonable return on their investment by the mortgage lenders, was ignored and those lenders were forced to accept losses. The lender side of the contract was violated and provisions, such as prompt and regular repayment of the loans on the borrower side were modified in violation of the original contract.
A contract now, is meaningless since it can be modified without consent of the parties by governmental fiat.  When a segment of law is violated by government, what restraints is there on government to enforce other segments of law?  Such as our existing immigration and border security laws?


When the law is meaningless, tyranny exists.  Obama, in the current Obamacare fiasco, ignores the First and perhaps the Fourteenth Amendments, then constitutional guarantees are also meaningless.

This trend does not bode well for the survival of our nation as a constitutional republic.  The path we are treading leads to chaos and a dictatorial government.
Another Mortgage Scam:  a $2000 bribe.  Obama has released another mortgage scam.  He proposes to provide more TARP money to subsidize some under-water mortgages.

Audacity Of Dishonesty Hijacks Truth In Lending

Subprime Scandal: Announcing a massive $26 billion mortgage deal with “abusive” banks, the president blamed everybody for record foreclosures except the party most culpable: government.
Speaking Thursday from the White House, Obama scolded “irresponsible” and “reckless” lenders, who “sold homes to people who couldn’t afford them.”
He also cited buyers who bought homes bigger than their budgets, and Wall Street bankers who packaged the shaky mortgages and traded them for “profit.”
“It was wrong,” he asserted. And now the nation’s “biggest banks will be required to right these wrongs.”
Obama acts as if the private sector bears all the responsibility for the mortgage mess. But he and his attorney general know it’s merely a scapegoat for the reckless government housing policies they and their ilk drafted and enforced in the run-up to the crisis.
Starting in the mid-1990s — in a historic first — it became federal regulatory policy to force all U.S. lenders to scrap traditional lending standards for home loans on the grounds they were “racially discriminatory.”
President Clinton fretted that blacks and other minorities could not qualify for mortgages at nearly the same rates as whites and Asians. So Clinton codified more “flexible” underwriting standards in a “Policy Statement on Discrimination in Lending,” and entered it into the Federal Register.
At the same time, he set up a little-known federal body made up of 10 regulatory agencies — the Interagency Task Force on Fair Lending — to enforce the looser standards. It threatened lenders to either ease credit for low-income borrowers or face investigations for lending discrimination and suffer the related bad publicity. It also threatened to deny them expansion plans and access to Fannie Mae and Freddie Mac.
“The agencies will not tolerate lending discrimination in any form,” the 20-page document warned financial institutions. The task force enforced these policies throughout the Bush administration.
According to Peter Ferrara, senior fellow at the Carleson Center for Public Policy:
“This overregulation reached the point of forcing lenders to discount bad credit history, no credit history, no savings, lack of steady employment, a high ratio of mortgage obligations to income, undocumented income, and inability to finance down payment and closing costs, while counting unemployment benefits and even welfare as income in qualifying for a mortgage.
“This” he said, “turned into government-sanctioned looting of the banks.”
The Justice Department — along with HUD, which regulated Fannie and Freddie — proved the most aggressive members of the fair-lending task force. Eric Holder, then acting as deputy AG, ordered lenders to actually “target” African-Americans for home mortgages they couldn’t otherwise afford. Obama cheered Holder on as an inner-city community organizer who also pressured banks to ease credit for home borrowers.
In other words, the same two officials now leading the charge to punish “abusive” lenders had egged them on before the crisis.
It’s not that the banks forced loans on those unable to repay, it that the banks were forced by government to issue those loans regardless of the ability of the borrowers to repay.  The concept of contract law was violated.

Oh, by the way, who gets these funds? $17 Billion to California, $2 Billion to Florida.  The “red” states get a few million, here and there.  It’s another payoff to garner votes in states whose liberal leanings are wavering. An average of $2000 per home borrower.

Kansas City Missouri is in a budget crises.  It has a very large shortfall this year.  The  KC Fire Department budget has been cut by the city manager who recommends cutting 105 people from the Fire Department.

At the same time, Schulte is recommending $7.5 million for raises, in part for management employees who haven’t had one in years. —

If I understand the ploy, since there has been fewer FD calls this year, the FD will be sacrificed to allow pay raises for KC managers.
On another hand, Kansas City Mayor Sly James wants to spend $1 Billion in infrastructure repairs and enhancements.  The funding would be through the issuance of bonds to be repaid at future dates.  The city’s revenues have either been flat or declining the last decade.  If the revenue doesn’t support the expeditures now, how can the city reasonably be expected to be able to repay those bond owners in the future?
Gamble on an improved economy?  Assume that a bailout from the Feds will save the city?  Or continue to steal from Peter to pay off Paul? Oh, yes, raise taxes.  Tax and spend. I should have known.
KANSAS CITY, Mo. — Kansas City Mayor Sly James says the city needs $1 billion to fix its crumbling streets and infrastructure.

James on Thursday asked the Kansas City Council to approve what would be the largest general obligation bond infusion in the city’s history. He called for issuing $100 million in bonds every year for the next 10 years.

Voters would have to approve such a large bond authority, and it probably would require annual property tax increases. — The Republic.

None of those options seem viable to me.  But that’s typical of the democrat controlled government of Kansas City, MO.

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