Menendez: Rein in Wall Street

In this article, entitled It's time to protect consumers, rein in Wall Street, NJ Senator Robert Menendez touts the financial "reform" bill now before congress. On the premise that NJ residents are stupid and unthinking, he pins the blame for the financial crisis on a few Wall Street firms.

I've left the following comments:

In Senator Menendez's statist Emerald City fantasy world, the great and powerful Oz, exemplified by "Wall Street", has wreaked economic havoc. Nowhere is the role of government interference examined. Mr. Menendez wants us to pay no attention to that man behind the curtain – the government’s political and bureaucratic wizards who pull the levers that control the financial industry and manipulate the markets through such mechanisms as Fannie and Freddie, the FDIC, mark-to-market accounting rules, explicit and implicit mortgage guarantees, the government licensed and competition-protected rating agency cartel, the CRA, the FHA, affordable housing crusades, overt and covert pressures on banks to increase low-income lending by lowering loan standards, too-big-to-fail taxpayer bailout policies, the perverse inversion of normal market incentives through socialization-of-losses policies, and that mother of all culprits – that funny money machine called the Federal Reserve.

The politicians rig the system to get people who can't afford homes into homes. Under the government's bipartisan "affordable housing" crusades, a conveyor belt of sub-prime mortgages runs overtime from the Fed to Fannie and Freddie. Wreckless lenders and borrowers flourish, to the delight of politicians who tout rising homeownership rates. Fannie and Freddie spread toxic mortgages throughout the system via securitization. Quick buck artists overwhelm prudent heads on Wall Street, cashing in on the game the men behind the curtain created. The system collapses. Derivatives and "Wall Street" get scapegoated. The politicians move for de facto nationalization of the financial system to "protect" that mystical entity - consumers.

How do you bring socialism to a country that would never explicitly vote it in? We've seen this pattern before. It's brought in through the back door of fascism. In finance, energy, healthcare, and education, to name a few areas, totalitarian powers are being accrued to Washington. The government creates crisis after crisis, which are never allowed to go to waste. In the not to distant future, we will wake up to find that our major industries are private in name only. Every area of our lives will be controlled by a small clique of all-powerful wizards, who manipulate the levers that run the shell corporations that used to be our great industries.

The fascist wolf has been creeping toward our American house for decades. Under the Bush Administration, the wolf reached the door. Under the Obama Administration, the wolf has crashed through the door.

Menendez, Obama, and their ilk are selling us a bill if goods, and down the river to tyranny. It's time to pay attention to that man behind the curtain

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