Freddie Mac, GOP firm hint at who’s to blame for bailout

20 10 2008

There are recent reports of mortgage giant Freddie Mac secretly paying a republican consulting firm $2 million to try to get republican senators to vote down a bill concerning regulation.

These reports are extremely important when looking at why the government needed to spend about a trillion dollars on the bailout package, because it shows how companies blatantly tried to manipulate congress into making people suffer financially.

The three "wise" monkeys of the story

The three "wise" monkeys

This measly $2 million is a problem, but the results of the AP investigation show a bigger problem that probably isn’t isolated to this one instance. If Freddie was careless enough to get caught once, how time times was he successful before slipping up?

And how many other companies do these same kinds of things?

Congress needs to look at this story and take away everything that could be interpreted as a golden parachute for these executives. Not only were these people responsible for the suffering of millions of people, they were also worthless at their jobs and even tried to perform secret missions to acquire power in the senate.

So, while some politicians are saying that playing the blame game won’t work, it could very possibly be because those senators were approached by DCI (the ones paid off by Freddie) and were somehow swayed to vote the way Freddie needed them to.

So who’s to blame for the bailout? The answer is simple. It’s not everyone, it’s not no-one. The answer isn’t to relax about where the blame should be.

There answer is companies like Freddie Mac, groups like DCI and senators like the ones who went along with these groups. Those are some of the people responsible for how terrible the economy is right now.

And Freddie brings up another question that needs to be answered as well: Why only target republicans when trying to take control of congress? What’s wrong with democrats?

Advertisements




The 2008 Bank Bailout – A Children’s Story

4 10 2008

Note: This is a fictional story based on real events. It has been simplified, so the children can understand.

Hello there boys and girls, I’m here to tell you a tale about three people who have been forced to live together for a long, long time. They’ve lived together for so long that they now need to each other, and if one of the three left, the other two wouldn’t know what to do.

These three people are named Lender, Person and Gov.

You see, they need each other because Lender has money that Person needs, Person has votes that Gov needs and Gov has regulation, which Lender needs. If any of these people stop sharing what they have with the others, all Hell could break loose.

One day, the system started breaking down. Gov wasn’t giving Lender enough regulation, Lender wasn’t giving Person as much money, and Person wasn’t giving Gov the votes he needed.

Without enough votes, Gov couldn’t make the right decisions and might not give Lender the right amount of regulation. Without the right amount of regulation, Lender won’t give Person the right amount of money. And if Person doesn’t get money from Lender, he has to get it himself and won’t remember to give Gov votes.

No one knew who started the chain of disaster. All that was known was it needed to be fixed.

Person and Lender didn’t want to be held responsible and ran to Gov to fix everything. Even though Gov wasn’t sure if this was completely his fault, he decided to take it upon himself to fix the whole situation. But how was he going to do that?

The three "wise" monkeys of the story

The three "wise" monkeys of the story.

Well, it turned out Gov had a lot of money he didn’t think he needed for anything more important, so he started giving a bunch of it away to Lender. Gov thought giving Lender a lot of money would mean Lender would have money to give to Person, and the whole cycle would work again.

The problem was Lender didn’t need more money, in fact, he had too much money in the first place. If Lender didn’t have so much money in the first place, maybe he wouldn’t have given it all away to Person before realizing that Person wasn’t going to give much of it back.

You see, Lender needed more regulation, not more money. But I’m not sure Gov is to blame. The lack of votes Gov got from Person led Gov to those bad decisions in the first place.