Manufacturing Consent: Imminent Financial Crisis or Political Theater?

Since last Friday, almost every sound bite on every news update or channel is of Barack Obama blaming John McCain for being in favor of “deregulation.” The implication is that McCain favored deregulating Wall Street financial institutions and Fannie Mae/Freddie Mac. This implication is patently false. In 2005, John McCain and three other Senators tried to tighten regulation of Fannie Mae (Who caused “the biggest financial crisis since the Great Depression?”, Roger Kimball, Pajamas Media). Bill Clinton, to be honest, also tried to tighten regulations during his Administration. Congress continuously tried to squelch these efforts.


Suddenly, in July 2008, Congressional Democrats decided that Fannie Mae and Freddie Mac needed reform (Democrats Receptive To Fix For Fannie, Freddie, Brian Naylor, NPR). Why then, after years of warnings? Why then, after years of defending the institutions and the failed leaders who ran them?

Why do we need this $700 Billion dollar bailout right now, right this minute?

Last week, we were warned that the house of cards would collapse on Monday. Monday has come and gone. Last night, Glenn Beck pointed out the following from an article in Forbes magazine:

BECK: First of all, it`s — wouldn`t that be nice. First of all, it`s $700 billion. And I just want to give you guys a quote from — from “Forbes” magazine. Are you ready for this one? This was actually from a treasury spokesperson on how did you arrive at this $700 billion number.

Are you ready? Here`s the quote. Quote, “It`s not based on any particular data point. We just wanted to choose a really large number.”

I couldn’t find this exact statement at Forbes.com but did find this:

The $700 billion figure is basically a placeholder, or, better yet, the worst-case-scenario figure Paulson could come up with to make sure his plan didn’t fall short in the funding department.

Manufactured numbers to produce manufactured consensus.

On Friday, Rush Limbaugh discussed the “behind the scenes” events at the emergency White House meeting (attended by John McCain and Barack Obama) on Thursday, September 25.

“According to an Obama campaign source…” and this is from the American Spectator blog today. “According to an Obama campaign source, the notes on the Republican position, House Republican position were passed to Obama via senior aides traveling with him who had been e-mailed the document via a current Goldman Sachs employee and Wall Street fundraiser for the Obama campaign. The Obama campaign source said, ‘It was made clear the memo was from friends and it was reliable.’ The memo, which basically briefed Obama on the Republican position…”

You see, Obama did not defend the Democrat position on this [the bailout]. He led off with an attack on the Republican position, as though it was a shock and a surprise, under the auspices that this deal had already been agreed to. When of course there’s no surprise about what House Republicans believe and there’s no surprise what conservatism is. “The memo allowed Obama and his fellow Democrats to box in Republican attendees and essentially took what President Bush had billed as a negotiating meeting off the rails.” Now, “‘Paulson and his team have not acted in good faith for this President or the administration for which they serve,’ says a House Republican leader who was not present at the White House meeting” and told the American Spectator. Paulson — Goldman Sachs — is a Democrat. He’s very close to Chuck Schumer, and obviously close to Obama.

Why do I feel like I’m being played? That I’m being manipulated to believe the sky is falling?

While I do think that we have a serious problem in the financial industry, I’m beginning to wonder if Henry Paulson isn’t a player and this whole imminent collapse isn’t just manufactured political theater (i.e., an attempt to focus the nation on economic issues because conventional wisdom says that this will benefit the Democrats in the November election). This article (Convict Bush, McCain and the GOP for the Economy) is a perfect example of the manufactured reaction.

Extra Reading:
Carnage in the markets! Carnage in the markets! Carnage in the markets! Oops, never mind, Michelle Malkin
The Financial Mess: How We Got Here, American Thinker
The financial crisis in bullet points, The Adam Smith Institute

McCain’s attempt to fix Fannie Mae, Freddie Mac in 2005, HotAir.com

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4 Comments

Filed under 2008 Election, Barack Obama, Fannie Mae, John McCain, Mortgage crisis, Politics

4 responses to “Manufacturing Consent: Imminent Financial Crisis or Political Theater?

  1. Who’s fault is it, really?

    While there is some blame to be shared by members on both sides of the aisle, history reveals the following:

    Under such catch phrases as “affordable housing”, the “Community Reinvestmet Act” of 1977 (President Jimmy Carter) was enacted. It’s stated purpose was to expand the opportunity of high-risk individuals to invest in homes by forcing mortgage lenders to help subprime borrowers get better loans. Industry lending procedures were further opened during the Clinton administration, a period during which Franklin Raines (then CEO of Freddie Mac) garnered in excess of $90 million over a four-year tour while serving the quasi-governmental

    lending institution. Today, Raines serves as financial adviser to Barack Hussein Obama during his campaign. Over a 20 year period, only four of which Obama has been a Senator – and, he’s been campaigning for two of those years, now – only Senate veteran Chris Dodd has taken more lobbyist monies from Fannie Mae & Freddie Mac than has Obama (he’s #2, having accepted over $126,000). Earlier this year, Dodd extended his praise to these financial giants, describing them as “riding to the rescue” as other mortgage lenders were reducing loans.

    Barney Frank, senator from Massachusetts and chairman of the House Financial Services Committee, only five years ago asserted as to the “soundness” of these companies. “I do not see”, he said, any “possibility of serious financial losses to the treasury.” Furthermore, he stated that the government has “probably done too
    little rather than too much to push them to meet the goals of affordable housing.”

    These are a few of the major players whom have created the financial “crisis”, and now these same people are presumably working in earnest to resolve the matter? Yeah, right.

    President Bush, in 2004, sought to increase regulatory pressures on Fannie Mae and Freddie Mac, and his chairman of the Council of Economic Advisors warned about the economic disincentives of these companies relying on a bailout should trends turn. In 2005, John McCain supported a measure to reform the lending industry, but it was rejected by Congress (including a vote against it by Obama – no surprise, there).

    Alan Greenspan, head of the Federal Reserve, has been outspoken for years about an implied reliance on our government that these lending giants greedily base business practices upon, so as to “multiply the profitability of subsidized debt.”

    Now, House Majority Leader Nancy Pelosi is playing to the cameras with sound bytes and pointing at the republicans as the root of all evil…what? As the majority, democrats could have passed this bill on their own without a single republican vote, but they didn’t want to go it alone – thereafter, highlighting the roles
    of participation that Frank, Dodd and Obama (among others, including some republicans) have played in sustaining the unfettered operations of failed lending giants Fannie Mae and Freddie Mac. And here we are, today.

    Facts are facts. See My Site for more.

  2. retractablehornsandtail

    Thanks for the insightful post Politix.

  3. Art is why I get up in the morning, but my definition ends there. Ya know it doesn’t seem fair that I am living for something I can’t even define.AniDifrancoAni Difranco

  4. Pingback: Another Pelosi Lie: “White House officials prevented Treasury Secretary Henry Paulson from alerting Congress sooner of the looming economic crisis” | Right Voices

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