Given that the current financial crisis is affecting just about everyone in one way or another. ConsumerReference has looked at a particular article from USA Today for some insight to the current issue and how it came to being.
Please read and comment below.
You can see the Full article here:
USA Today
By Ken Dilanian, USA TODAY
WASHINGTON — During last week's presidential debate, John McCain and Barack Obama sparred over what caused the financial crisis.
"The match that lit this fire," McCain said, came from the government-sponsored mortgage companies Fannie Mae and Freddie Mac, which backed risky home loans "with the encouragement of Sen. Obama and his cronies … in Washington."
Obama shot back: "The biggest problem was the deregulation of the financial system. … Sen. McCain, as recently as March, bragged about the fact that he is a deregulator."
It was a classic example of Washington finger-pointing. McCain and the GOP blame Fannie and Freddie — which were taken over by the government last month — because the troubled mortgage agencies' biggest backers were Democrats who said they wanted to increase access to homeownership.
Meanwhile, Obama and other Democrats highlight Republicans' longtime focus on limiting regulations for the financial industry.
No single government decision sparked the crisis, but collectively the candidates had a point: Both parties in Congress played important roles in setting the stage for the ongoing financial meltdown.
They did so in moves that reflected not just their ideological priorities, but also the wishes of special interests that have spent millions aggressively lobbying Washington and contributing to lawmakers' campaigns.
By not reining in increasingly risky investments made by Fannie and Freddie — and by keeping complex financial instruments known as derivatives free from most government oversight — Congress chose not to impose barriers that economists widely agree could have helped stave off the crisis that continues, even after lawmakers approved a $700 billion emergency bailout package for Wall Street.
Here is a look at how Congress' actions on two key fronts became significant factors in the financial crisis:
1. Not checking derivatives
2. Protecting Fannie, Freddie
Here is a list of the TOP Officials taking over one hundred thousand dollars from Freddie Mac and Fannie Mae:
Dem - Dodd, Christopher J $165,400
Dem - Obama, Barack S $126,349
Dem - Kerry, John S $111,000
Rep - Bennett, Robert F $107,999
Rep - Bachus, Spencer $103,300
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How has this situation affected you personally?
Should those who received the most payments from Mae and Mac be investigated for collusion?
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4 comments:
Nice post. thanks for listing the politicians taking money. I like that
MP - WE NEED MORE ACCOUNTABILITY
Interesting post. The whole discussion on Fannie and Freddie leaves me cold. To me, it seems like a hindsight is 20/20 scenario. Perhaps there were those who had enough information and experience to have foreseen what has transpired recently, but I'm certainly not one of them.
I think greed and individual selfishness has left the majority of our nation drowning in debt and it's left us in panic mode. I believe our present economic nightmare has made each political party feeling their end of responsibility. Unfortunately, although it's easiest to point the finger, that's not the way to get ourselves out of this mess. Truth is a very hard taste to acquire, yet it's worst to come to understand this bitter tasting "crap" may not have had to been on my plate in the 1st place.
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