As we have said, the book on how we got into this financial mess will be a politically incorrect financial thriller with many villains. This video above was produced from the GOP side, but make no mistake, Democrats will be able to put together a highlight reel of their own featuring their favorite miscreants. Regarding this YouTube clip, it would have been merely amusing to see a California Congresswoman praise foolish “100% loans” as a great innovation in this video, if such innovations were not such an important part of getting us into this global financial morass.

Rhodes Scholar and Fannie CEO Franklin Raines (sued by Fannie regulator OFHEO for $90 million of what he was paid) intones at one point that “these assets are so riskless that the capital required to hold them should be under 2%.” He might have a technical point if the securities had been explicitly guaranteed by the Federal Government, but they were not. The mortgage loans only had some unwritten moral backstop by the Feds, which, in the real world is very often no guarantee at all.

Senator McCain could hit the Congressional pressure to limit regulatory oversight very hard, but it is a risky strategy that the MSM would strongly condemn, given recent examples of MSM bias. But he may well need to engage the issue and live with the criticism. A campaign that insists on “country first” is not to be taken seriously if it avoids dissecting this crisis — a real crisis, by the way, not just some contrived affair. However, discussing the abuses of the Community Reinvestment Act and related initiatives could be beyond McCain for a host of reasons. Pity.

This entry was posted on Monday, October 6th, 2008 at 5:25 pm and is filed under Democrats, General, Republicans, business. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.