Rush’s Morning Update: Piggy Bank
February 11, 2010
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Every day, President Obama blames his woes on George W.Bush. So let’s look at what Obama has done with Fannie Mae and Freddie Mac, the institutions behind the economic collapse.
On Christmas Eve, the Treasury Department announced a new policy. Instead of a $200 billion cap, there would be no limit on the amount of taxpayer money Obama could use to bail out Fannie and Freddie. The companies have already run through over $100 billion –with no end in sight.
You might think that spending unlimited taxpayer money would require Congressional approval — and you would bewrong. All Obama has to do to spend unlimited funds is issue orders to the Federal Housing Finance Agency.
Why are losses still mounting at both entities? Well, because Obama ordered Freddie and Fannie to keep borrowers who defaulted on their mortgages in the homes they couldn’t afford in the first place. In addition, derivative contracts– the financial instruments that defaulted around the world– are still being traded, and the firms that bestowed triple-A ratings on shaky loans are still being used. By the way, Fannie and Freddie executives just got huge bonuses.
During the Bush years, Republicans repeatedly tried to rein in Fannie and Freddie;Democrats,who use the institutions as political piggy banks,blocked every effort. Now Obama and Democrats have no limits. The “root cause” of the economic meltdown is still rooted-in, but now it’s exploding. Seems “change” doesn’t take long to enact after all, does it?
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