George Bush's See No Evil Hear No Evil Mortgage Policy

Opponents and supporters alike have tried to put some context on Bush's responsibility for the mortgage mess that has turned into a full out economic crisis. The latest foray into this analysis is this piece from the New York Times in which all the blame was place on the Bush administration for the entire crisis. That is far too simplistic. Yet, there is no doubt that as President, Bush deserves plenty of blame for what is happening. The question is how much and for what.

From my perch inside the industry, here is how I see his role in this crisis. I think all of us remember that one of the themes of Bush's first term was the so called Ownership Society. In fact, for years Bush touted that under his administration there was record home ownership. For about three years, this became an integral mantra of Bush's domestic policy.

Those within the industry knew the dirty little secret of the "record home ownership". It was being created by marginal loans and many of these loans were fraudulent. The reason there was record home ownership was because fraud was being created on a scale not seen before in the industry's history. In other words, on an unprecedented scale there was fraud on mortgage loan applications that lead to an unprecedented level of fraudulent loans. These fraudulent loans became a part of mortgage bonds and filtered their way through many different investment vehicles.

Now, we'll never know why the Bush administration turned a blind eye to the wholesale fraud committed on their watch, and ultimately it doesn't matter. Whether they simply didn't recognize it, or they simply didn't want to know it was going on, doesn't actually matter. The results speak for themselves. Personally, I don't think it is merely a coincidence that Bush touted the ownership society as it was being created by fraud. I think that the Bush administration didn't want to know how this was happening. I think that because there has always been a certain level of fraud in the industry they simply assumed this was a natural part of the business.

Either way, Bush is responsible for not aggressively confronting the fraud. Routinely loans had lies regarding income, assets, and occupancy. It became an epidemic and that epidemic is now biting everyone. This epidemic could have easily been confronted if Bush had the will and the motivation. Either Justice, HUD, the SEC, or any number of other agencies, could have made any one loan an example. At any time, anyone could have found fraud anywhere and made a grandstanding gesture against that loan. Everyone involved could have been prosecuted and the administration would have had the bully pulpit of the media to make the case that the Bush administration would no longer accept wholesale fraud in the industry.

That loans were being done largely through wholesale fraud became an open secret. If the Bush administration didn't know it, that is unacceptable. If they did know it and did nothing that is no less acceptable. That they didn't do anything about it is their responsibility for the mortgage crisis that is now eating away at our economy. That is their role in this crisis.

Note to Israel: Tit for Tat is Now Way to Go

It appears that Israel has had enough and they are striking back at Hamas.

Israeli warplanes retaliating for rocket fire from the Gaza Strip pounded dozens of security compounds across the Hamas-ruled territory in unprecedented waves of airstrikes Saturday, killing at least 200 people and wounding 270 others in the single bloodiest day of fighting in decades.

Most of those killed were security men, but civilians were also among the dead. Hamas said all of its security installations were hit and responded with several medium-range Grad rockets at Israel, reaching deeper than in the past. One Israeli was killed and at least four people were wounded in the rocket attacks. With so many wounded, the Palestinian death toll was likely to rise.

The air offensive followed weeks of intense Palestinian rocket and mortar fire on southern Israel, and Israeli leaders had issued increasingly tough warnings in recent days that they would not tolerate continued attacks.

Here is one Israel supporter that hopes that this time Israel holds nothing back. In my opinion, the worst strategy is the sort of tit for tat strategy that appeared to be their staple for many years in the earlier part of this decade. In such a strategy, every terrorist attack, rocket fire, or missile launch was met with an equally aggressive action by Israel. Such a strategy, in my opinion, is the long road to a cycle of violence.



I remember seeing Gene Simmons, of KISS, interviewed by Bill O'Reilly. O'Reilly asked Simmons why he was so confrontational. Simmons said that he was of Israeli descent and so if you attack him he hits you back three times harder.



This seems to be a much more effective strategy. There is no doubt that Israel will be viewed in the Middle East as in the wrong and the aggressors. Soon, there will likely be a United Nations condemnation that will need to be vetoed by the United States. Soon, it's likely that the world community will stand in unison in condemnation of "Israel's aggressive action". It's likely that Vladimir Putin, in the irony of geopolitical ironies, will once again call for a measured response.

This will all happen no matter how aggressive Israel is in taking on Hamas. Israel has one of two options now. They can either strike back and pull back, or they can take on Hamas in one final bloody war and end this once and for all. The first option is a lot less bloody for both sides and it will end quickly. For the time being, Hamas will be battered, bruised, and weakened. Make no mistake, if this is merely an aggressive air offensive, Hamas will regroup and they will strike again.

The other option is for Israel to call for an all out war. They can augment the air offensive with an equally tough ground offensive. There is no doubt that such a strategy will produce a lot of deaths on both sides. Many Israeli soldiers will die in what will wind up being a street to street hand to hand combat. This will be tough, brutal and deadly, but it also has the real chance of finishing off Hamas once and for all. If that's what Israel wants, can stomach, and has the will to do. When Israel engaged in a bloody battle with terrorists in Jenin, the world condemned her actions. Yet, that action left many high value terrorists dead, and in the years following this confrontation, deadly terrorist attacks went down dramatically in Israel. In fact, each and everytime Israel follows Simmons' view and strikes back three times as hard, terrorist attacks slow down within her own borders dramatically. Now is the time not merely to strike back three times as hard, but so hard that Hamas is finished off once and for all.

The worst thing that came out of its war with Hezbollah was that Israel stopped before the war was over. Now, Hezbollah is stronger. Hezbollah won because it took Israel's shots and still ended up standing. That only happened because Israel stopped punching before Hezbollah was knocked out. The leadership of Israel didn't have the stomach to finish Hezbollah off. Once public opinion became too strong it cut off its military operation. If Israel does this again with Hamas, that would be the worst thing that could happen.

Israel has two choices. They can make this war the last war against Hamas or they can make this military operation yet another in a long line of tit for tat operations. The first option will be blood, brutal and very deadly, but it will also be final. The second will be relatively painless and easy, but it will lead to another round of relatively painless and easy military operations. I hope this time Israel says that once and for all Hamas will be confronted until each and every one of them is dead.

The Unelected Corruptors of Fort Stockton

The general consensus among those I spoke with in Fort Stockton , Texas, is that the mayor, Ruben Falcon, is an incompetent fool. In fact, it is an open secret that the money his family has gained came originally from drugs. Recently, his father died by suicide. At the funeral, during his eulogy, Falcon was heard to utter

our family is living the American dream. Look, at me I'm the damn mayor

Not very statesmanlike in my opinion, but then again, you get the government you vote for. In Fort Stockton, it's a lot more complicated than that. Like in most small towns, the mayor, along with most of the city council, is a part time position. In fact, each pays only a few hundred Dollars monthly. In fact, the mayor has little if any power.

The only real power for the mayor and the city council lies in choosing the City Manager, currently held by Rafael Castillo Jr.

The day to day decisions of the town are made by the City Manager. The manager also gets a salary that allows him to make this job his only job. For the elected officials, being a part of government is something they do for prestige, civic duty, or even some sense of power, but they must do something else to earn a living. Because all the elected officials have positions that are largely ceremonial, the town has ceded most of its power to unelected bureaucracies. There only real role is selecting the City Manager and that's it.

In this way, Fort Stockton becomes corrupted much like Chicago, Cook County and Springfield. The real decisions are made in bureaucracies beyond the eyes of the public. The real decisions are made by those that aren't answerable to the people. In Chicago, Cook County, and Springfield, this happens because those with money use it to influence those in office, and then gain power in the bureaucracies and use it to corrupt. In Fort Stockton, that process doesn't even need to occur because those in office never had any power to begin with. As such, the town is run to the benefit of those with influence. Those with business interests use their power so that the bureaucracies run the government in their favor. Much like in Chicago, Cook County, and Springfield, often this means they control the bureaucracies themselves. Even in corrupt Chicago, the citizens would never stand for Richard M. Daley ceding day to day operation of the city to an unelected City Manager. Yet, in Fort Stockton, that's exactly what's happened. Furthermore, the town's only newspaper the Fort Stockton Pioneer only comes out once weekly and so doesn't have nearly enough resources to be the proper watchdog over its city government.

There is a sort of unique political irony and opportunity here. Because Fort Stockton has a sort of shadow government, much again like in Chicago, Cook County, and Springfield, anyone with the vision has the platform to run on and turn the government over to those that are elected. With it, that individual would also consolidate more power into their own hands. There is no reason why an unelected bureaucrat would make near $100k while the mayor would barely make $2k. There is also no reason why the day to day decisions would be made by someone unelected, as it is by the City Manager, while the elected mayor is largely ceremonial.

An open government, a transparent government, and a government answerable to the people, would be run in the exact opposite way. In Fort Stockton, the government has finally made the City Council meetings accessible to all online. So what? Nothing of substance ever gets done there. There meetings are largely ceremonial and almost entirely nothing more than a debating society. If the city government were really transparent and open, the meetings held by the City Manager would be the ones open to the public. Of course, if the government were really open, the City Manager wouldn't be the one with all the real power.

Small towns like Fort Stockton don't necessarily have the money to pay for all sorts folks to run their government. Yet, it appears the town is perfectly happy having the one running it be an unelected bureaucrat like the City Manager. The platform is there for someone to point out that this is ludicrous, and move the power away from the unelected bureaucrat and into the hands of its elected Mayor. With it, that individual would also pull off some political jujitsu because with it, they would consolidate power in their own hands.

A Modest Proposal for Long Term Peace in the Middle East

One of the greatest tragedies in the Middle East is that Israelis and most of those that consider themselves their enemies are ancestral cousins or even brothers. Trace their lineage back and you will find that all those folks that consider themselves enemies now were of nearly the exact same blood line. In fact, if they don't that one person is Jewish and the other not, it's likely you wouldn't be able to tell each apart.

The thing about hate, bigotry, and racism is that it comes from a position of ignorance. In other words, White racists rarely new any Blacks. Racists of all shapes and sorts come to their racism because they know very few people toward which their hate is directed. In my own experience, that's exactly what happened. Up through high school, I experienced a lot of bigotry because of my Russian birth. I was often the first person that anyone met from Russia. In college, I experienced similar bigotry because of my Judaism. Everyone that made a Jewish remark had made me the first Jewish person they met. Had all these folks been exposed to Jewish children when they were growing up, I think their racist remarks would have been much more limited.

The hate in the Middle East takes on a similar dynamic only in a much more intense and deadly form. Most Palestinians have never known any Israelis in any substantive way and the same can likely be said the other way. Unfortunately, adults filled with hate are likely beyond hope. In order to achieve any lasting peace we all must get to the children before they are corrupted by hate.

That's why I think that an exchange of school children as young as six, Israelis and Palestinians, would be a productive way to bring the two people together. Six year olds have an innocence that allows to get past the hate that their parents can no longer. If Israeli children are brough together with Palestinian children in an exchange in which they all simply act like children, that is the best way for both sides to get past the hate. If children simply interact as children, they will find that they really aren't very different from each other at all.

This is one of those plans that is easier said than done. It's likely many of these children would never allow such an exchange. Furthermore, in the Middle East, there is always the concern of security, especially in such an endeavor. That's why it would make sense for some of this to be created right here in America. Many reporters have mentioned that in private Palestinians dream of one day coming to America. As such, a joint tour of America sponsored and attended by both Palestinians and Israelis is a good place to start.

It's the sort of idea that would need support of leaders of both the Israeli and Palestinian community. It's best place to start is here in America where there is moderates on both sides. It's the sort of idea that for instance AIPAC, the Jewish United Fund, as well as all sorts of pro Palestinian groups in America would all need to get behind.

It couldn't merely be a small token statement to make a difference, but it wouldn't need to involve the exchange of entire populations. Kids talk and they will share their experiences with their friends back home. When they come back with great stories, other kids will also want to share in the same good time. This is the sort of idea that can start with a modest exchange and it could grow. Bringing children of both cultures together is in my opinion a great way for both sides to get past the hate.

Risk Aversion: The Biggest Risk of All

Forbes has an excellent piece that lays out what will be one of the biggest challenges to face our economy going forward. For much of the last fifteen years, our economy was built on risk taking, and in many ways, far too aggressive risk taking. The blow up of the economy has made everyone from the banker, the business owner, to the consumer risk averse. In fact, it's likely that that our entire economy has become far too risk averse.

Without risk, our economy doesn't grow. Nearly a hundred years ago, my friend's grandfather was offered a business proposal. With a $5,000 investment, he could in on the ground floor of a company with a then revolutionary idea: the car radio. My friend's grandfather declined and that's too bad because the company is Motorola. While now hindsight is certainly 20/20, at the time this investment was a risk. It is exactly this sort of risk taking that creates economic growth.

Now, there is very little room for risk taking. Banks are cutting back on those they lend to. Businesses are cutting back on their investment. Consumers are cutting back on their purchases. Even the ultimately risk takers, the hedge fund managers, are hoarding cash and cutting back on their risk taking. Without risk takers, the next Motorola never happens.

Risk, much like anything, is a numbers game. The more of it we have the more of it turns out good. In this economy though, does anyone really see a business taking a chance on expansion? Does anyone really see an entrepeneurs investing in start up? Does anyone really see any wealthy person invest in anything but Treasury bonds? Even consumers won't take many risks on purchasing products, services, or anything else.

Our economy has become far too leveraged. As such, it is a good thing in the long run that people become savers, and the same is true for companies. Of course, if all everyone ever does is save, then no one will take a chance on risk. Without risk taking, the next Motorola is not created, and all the economic expansion that goes with it. We have turned into a nation of savers, or as Forbes calls us, wussies. This may eventually be a good thing, but in the meantime, it will stunt our economic recovery.

A Liberal's View of Patriotism

I am really glad that Joel Stein penned this piece about the differences between Conservatives and Liberals and their love of America. I am glad because not only is it one of the most ridiculous pieces I have ever read but it also unmasks how many Liberals feel not only about their country but about their ideological opponents. The other day, I had a debate with a liberal colleague about universal health care and he told me that I was stupid because I didn't realize that health care is a right and that our government must do everything to make sure that everyone has health insurance. In other words, I was stupid because I disagreed with their position.

This is essentially the position that Stein takes. Conservatives are so patriotic, in the view of Stein, that it makes us stupid. Whereas liberals, according to him, aren't blinded by their patriotism, and so they are able to see that which dumb Conservatives like me are blind to. What's most amazing about Stein's piece is that it is so short on any detail about why he is right. He starts his explanation as such.

Conservatives feel personally blessed to have been born in the only country worth living in. I, on the other hand, just feel lucky to have grown up in a wealthy democracy. If it had been Australia, Britain, Ireland, Canada, Italy, Spain, France, Luxembourg, Belgium, the Netherlands, Switzerland, Japan, Israel or one of those Scandinavian countries with more relaxed attitudes toward sex, that would have been fine with me too.

Now, there's no doubt that our freedom and democracy account for much of our greatness. It's also true that the U.S. is not the only country in the world that has these things. Yet, is Stein really saying that there is no difference between the U.S. and Luxembourg? Is Stein really dismissing the idea that it was the U.S. most centrally responsible for bringing peace to hundreds of millions of people throughout the world including in many of the countries that he lists? When was the last time Luxembourg confronted an evil tyrant and freed millions from their grip? In fact, it is the U.S. itself that is most responsible for protecting Luxembourg from invasion. Stein can go live there but he will still be afforded the protection of the greatest military in the history of the world when he does. It seems that Stein is just oblivious to the fact that Europe has nothing more than a token military to speak of and that's because they rely on the U.S. for protection. I guess protecting most of the world from evil and tyranny is something to be marginalized and disregarded in the mind of such an elite intellectual as Stein.

Then, Stein lays out his "laundry list" of problems with America.

This doesn't mean I'm not fascinated by American history, impressed by our Constitution or don't appreciate our optimism and entrepreneurial spirit. In fact, I love everything Hannity listed on his TV special other than Madonna. But there are plenty of things I don't like about America: our foreign policy, our religious fundamentalism, our provincialism, our intellectual laziness, our acceptance of sweat suits in public.

I suppose that Stein would like the neutral foreign policy of a country like Luxembourg, however there is something that Stein misses. When your country is only a few hundred thousand people, you can afford to stay neutral. Being the one and only super power, we are not afforded the luxury of inaction. I would be curious to know what specifically he doesn't like about our foreign policy but that he doesn't mention. No one is saying that America is perfect, however I would say that America is still the greatest country in the world even if we allow sweat suits in public. What's more, he considers America a country of "religious fundamentalism". It's hard to know what he means by those, but I assume by this he means we don't totally shun religion into some back corner. I suppose because we allow those of genuine and deep faith to have a platform, this makes us religious fundamentalists because to secularists like Stein the only religion that is good is one he knows nothing about.

Here is how he finishes his supposition.

When I ran the idea that liberals don't love America as much as conservatives by talk-show host Glenn Beck, who will move from CNN Headline News to Fox News next month, he totally agreed with me, which is precisely why I called him. "It's absolutely true, deep love. As a parent loves a child," he said. "But I think liberals laugh that off, the way the rest of the country laughs off the love Texans have for their state. Texans don't think, 'Oklahoma, you suck.' Well, yes they do -- but they don't think other states suck. They just have a love for the republic of Texas. I don't have disdain for other countries. Well, except for France."

I asked Beck why Democrats rarely share his overwhelming sense of American exceptionalism and Francophobia. "I think it's because in the late 1800s up until the 1930s, the progressive movement started to think the European ideals are pretty good, that it's one big world," he said. "Well, it's not. If you look at all the countries like people, there are differences between people. And I happen to like this person the best." When I look at the countries like people, I love Sweden the best.

I would remind Stein that the so called European model has produced a continent in which the population doesn't have enough children to survive. It has a stagnating economy and frankly what we are seeing is that country after country is looking to get away from its nanny state and go toward the free market ideals that we have here. In France, that's how Nicholas Sarkozy won and in Ireland they cut their corporate tax dramatically and spurred economic growth. I would remind Stein that the U.S. economy has a larger GDP than the next four combined. I would remind Stein that the European model has created stagnating GDP growth and a population that is rapidly deteriorating.

In effect, Stein is right. Generally, Conservatives are more patriotic than Liberals. That's because we are able to appreciate that which makes this country great and the greatest in the world. I will let Liberals espouse the ideas of European ism, moral relativism, and secularism. I will stick to all the traditions that have made America great.

Council Winners

First place with 2 2/3 points! - The Razor - The Symbol of Oppression
Second place with 1 2/3 points - (T*) - Joshuapundit - Cheney Slaps Biden Upside The Head
Second place with 1 2/3 points - (T*) - Mere Rhetoric - Smug Liberal Sophistication Undisturbed By Decades Of Disastrously Wrong Domestic And International Predictions
Third place with 1 points - Bookworm Room - Destruction of Property
Fourth place with 2/3 points - (T*) - Soccer Dad - Don’t get too chummy with that flaming dummy
Fourth place with 2/3 points - (T*) - Rhymes With Right - Impeach Jerry Brown
Fourth place with 2/3 points - (T*) - The Glittering Eye - How to Give a Bonus
Fifth place with 1/3 point - Cheat-Seeking Missiles - Gay Anger At Warren Unwarranted
Winning Non-Council Submissions
First place with 2 1/3 points! - John Stossel - Arrogance and Conceit Won’t Fix the Economy
Second place with 1 2/3 points - (T*) - Larrey Anderson/American Thinker - Climate Crisis = Logic Crisis
Second place with 1 2/3 points - (T*) - Dhimmi Watch - Fitzgerald: If we cut off the jizya, could things become even worse?
Third place with 1 1/3 points - (T*) - Pajamas Media - The Op-Ed the New York Times Wouldn’t Run
Third place with 1 1/3 points - (T*) - Counterterrorism blog - Jihad by the Shoe: Who Was Behind it and why?
Third place with 1 1/3 points - (T*) - Simon Deng - Hudson New York - Bishop Tutu and “Israeli Apartheid”
Fourth place with 2/3 points - The American Spectator - Coffee and Closure
Fifth place with 1/3 point - Jewcy - Madoff the Jew: The Media’s Hypocritical Obsession With the Fraudster’s Faith