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How can we trust government to fix the economic problems they created?

Freddie Mac, Fanny Mae, and the Federal Reserve are all creatures of government.
Change now. Dont ever trust the government. I feel sorry for you man.

Asked By: William F - 11/30/2008
Best Answer - Chosen by Asker
It's really a question of responsibility.

Fannie and Freddie are GSEs (Government Sponsored Enterprises) and as such not part of the government. They are privately owned and the shareholders expect their CEOs to make as much money as possible within the bounds of the law. In fact, that would be the mandate and fiduciary responsibility of any corporate CEO.

Average Americans who borrowed money to buy a house were also operating within the bounds of the law. No job verification, no income proof, no asset search or reporting was required if one was willing to pay a little higher percentage for their loan. These folks didn't break any laws. They are guilty of looking out for themselves, and isn't that what one is supposed to do? What about the guys that were "flipping" houses? Did they break any laws? No.

Government is the entity that is responsible to the people of America. We can be angry with those that made loans and those that accepted loans, but they were all acting in their own self interests. None of them had any responsibility to look out for American citizens.

If you boil away the fat, there are two primary pieces of legislation that are most responsible. First, the rewrite of the CRA (Community Reinvestment Act) in 1993 forced stiff penalties and quotas on banks to make bad, or at least questionable loans. And the Gramm-Leach-Bliley Bill, signed into law in 1999 overrode certain aspects of the Glass-Stegall Act of 1933, making it possible for Fannie and Freddie to purchase loans with virtually no limits. (New limits on the CRA were originally in this Bill, but were ultimately forgone in an effort to get it [the bill] through Congress and ultimately signed by the President.)

Tiny OFHEA was left in charge of watching this industry's operations under their newly-found freedom. Armando Falcon, Director of OFHEA reported to Congress in 2004 that Fannie and Freddie were heading for serious trouble if we didn't enact some sort of regulation. Barney Frank, in attendance for this report, insisted that there was nothing wrong with Fannie and Freddie. Further, he bullied Falcon to the point of accusing him of not knowing his job. Others in the room were nearly as bad, like Maxine Waters. You can watch the proceedings from CSPAN on Youtube if you'd like.

Well, here it is, close of 2008 and it turns out Barney Frank was wrong, and Armando Falcon was right. Want to blame someone? I would place more blame for this mess on Barney Frank than anyone else. He had the power to stop it, and chose to look the other way. He has blocked every serious effort to fix this problem over the years. You know what else? Barney Frank has yet to appologize to America for his part in this mess. He has failed the American People and should be voted out of office!

Others you can blame:
*Clinton for rewriting the CRA
*Clinton for signing the Gramm-Leach-Bliley Bill
*Gramm, Leach and Bliley, obviously
*Dodd, Shumer, Frank, Biden, most other Democrats and most Republicans in Congress for voting for the Gramm-Leach-Bliley Bill

Should we allow them to fix it? No one else can fix it I'm afraid. The laws have to be changed and we need Congress to write them and the President to sign them. We need some regulation and a major rewrite to the CRA, obviously.

Should we be giving billions and billions away to everyone that needs a little cash? I'll leave that to the economists for now.


EDIT
Change Now:
Sorry friend, but I just can't stay silent after reading your answer. Where did you learn that anyway? Well, where ever you got that crapola from, I suggest you go back to them and explain that the American People are like the parent and the government we elect are like our children.
If they have a problem with that, give them my email address!
Have a nice day.
Answered By: Pragmatism Please - 11/30/2008
Additional Answers ()
We can't. Congress is filled with politicians who have conflicts of interest. Many many folks in Congress came from the business world. Many of them served as CEO's and served on corporate boards. They are there to protect the status quo. They are there to promote corporate interests, not the interests of the people. They voted to bailout their business cronies on Wall Street and they pushed it through quickly without listening to the opinions of their constituents. When their Wall Street buddies are in trouble, they arrive on the scene to help them faster than Superman arrives on the scene to save the day. But when there is a real crisis that affects millions who are in poverty (like the health care crisis or the Hurricane Katrina incident), they move slower than a turtle to solve it. To expect them to fix a problem they started would not make sense. They want to keep the system just the way it is because they are profiting from it.
Answered By: cannonball - 12/1/2008
Many in the government are clueless about the economy. They are afraid, and have decided to abandon their responsibility and instead allow bankers to run the country. So if the question were "can we trust the bankers to 'fix' the economy", the answer is no. They intend to destroy the economy through inflation and deflation.
Answered By: wnc817 - 12/1/2008
We can't that is the problem.
Answered By: Princess K - 11/30/2008
No because they are the problem.
Answered By: dumdum - 11/30/2008
We can't. Bush=Obama=big government bureaucrats
Answered By: Willis Jeffords - 11/30/2008
I really am to the point believing that this country will have a hard time to bounce back. if we keep on rewarding this corporation from their own mistakes , what will stop them from coming back and asking for more?
Answered By: 12KJ - 11/30/2008
So far they are just pouring money hand over fist into the same broken system. It doesn't sound too promising to me at this point.
Answered By: BekindtoAnimals22 - 11/30/2008
That's just it we can't. Trusting the government to fix what they broke is like telling the lion to have mercy on the lamb he is devouring.
Answered By: Uh Huh! - 11/30/2008
The Bureaucracy is expanding to meet the needs of the expanding bureaucracy.

How do they do it? By having a convenient scapegoat: Free Enterprise. Honestly, how many people do you know have the integrity to say "you know what, what I did was wrong, they are right, and I will be switching my position to his side." NEVER happens... especially in politics. If the economy reacts negatively to a politician's policies, he is not going to blame his policies, he is going to blame the people for not working the policies the way that they were intended to work.
Answered By: MJR - 11/30/2008
I think at this point the government is close to being a creature of the Fed....

but i digress.

We can't follow those who drove us over this cliff to begin with, the Keynesians like Obama's new Treasury Secretary to be, the head of the NY Fed. We need to follow those who predicted the mess, people like Ron Paul and the Austrian School of economists. They'd say stop propping up bad assets and bad debt and let the market correct to get it over. We will feel the pain anyhow, and this makes it a decade instead of a year, and leaves us broker after paying for the bailouts.
--
change now - the government WORKS for us, it isn't our parents. Heaven forbid. And it isn't trustworthy or weren't you noticing the bailouts and the patriot act and fisa etc?
Answered By: DAR - 11/30/2008
Lack of government regulation created the problem.

If you can't trust your own government, who can you trust.

Think of the government as your parents. How dysfunctional is a family when the children don't trust their parents.
Answered By: Change Now - 11/30/2008
Never Trust Government to fix the problem they created. The House problem was created by the reinvestment act.Signed by Carter and expanded by Clintons.
Answered By: phillipk_1959 - 11/30/2008
My Friends

I could offer one solution.

As u cast votes U must ask ur power to call your votes, and see all the mischief could be solved ?
Any suggestion how to call your votes may be another problem?
Answered By: CA,S K somani - 11/30/2008
You're a very uneducated person if you consider fannie mae a creature of the government. First off the government hasn't gotten us into this economic problem, but they are doing what they can to try to help the US companies out which will in turn boost the economy. People like you make me want to support abortion.
Answered By: Matao D - 11/30/2008
Who trusts the government? They should be beaten with a stick. Are there seriously people out there that are that dumb? I hope not, I have to share this planet with them....
Answered By: flercemel0n - 11/30/2008
Of course we cannot trust the fox to repair the hole in the hen house!


Change now: I hope you are not representative of the successful indoctrination of our young people. You cannot trust the government - LEARN THAT. The government has become corrupted by the banksters and elite corporate interests. It cannot and will not serve the interests of Joe Citizen.
Answered By: Ruby - 11/30/2008
Most people don't understand how central banks cause the bubble / crash cycle. The government tells them that the problem is the making of the free market and that more government is the answer. Economics is not part of the high school curriculum and these are not simplistic matters, so most people are simply fooled.
Source(s):
www.mises.org
Answered By: Randall E - 11/30/2008
One cannot expect government to "fix" economic problems when "government" is the people. Together, "people" can address their own economic situation, and do whatever is necessary to "fix" that situation.

Many of us, me included, can examine how we spend our money, and make adjustments where we can.

My first husband and I were both college graduates. We took teaching jobs, got credit cards, bought property, had two children, and spent money we thought we had on clothes for our family, toys for our children, mini vacations, and cars. We were doing so good, we even bought a 160-acre farm and began raising cattle, hogs, and got a loan from FHA to build two lakes (one 30-acre, one 10-acre), and 10 holding ponds for raising catfish. We were stretched to the max!; but the "government" kept loaning us money.

The financial strain exacerbated an emotional strain on our marriage, and after 26 years of marriage, my husband and I divorced. Our two daughters were the ones who paid the highest price. They were left without a family. Unfortunately, I can't sue the government for willingly loaning me and my husband money we willingly asked for; but, I want to warn others about accepting what they believe is "free" money. Nothing is "free".

My second husband and and I are both retired. We are on a fixed income of $2,000 per month. Six hundred and thirty dollars goes toward rent of a two-bedroom apartment. We pay about $143 a month for cable, telephone, and internet service. Our electric bill is around $95 a month. Our apartment is all-electric, so we don't have a gas bill. We both smoke, so $200 to $250 dollars a month goes up in smoke. Our cars are old; but, paid for. I have full coverage, with a $500 deductible on my car, and my husband's car is only covered with liability. We have home-owners insurance through the same company our car insurance is with. We pay $95 a month.

We do not have any medical insurance other than Part A under Social Security. As a member of a Federally recognized Native American Indian tribe, I am eligible for free medical care through any Indian clinic or hospital. Thankfully, I live in a state that does have these facilities. The nearest facility is 25 miles away. My husband is a veteran, and is eligible for health care through the Veterans Administration. The nearest veteran's hospital is 60 miles from our apartment.

To supplement our fixed income, I do substitute teaching in our local school district. I shop at the Dollar Store and discount grocery stores for our basic needs. I haunt the local thrift stores for shoes, clothes, and household items such as sheets and pillow cases. My underclothes even come from the thrift store!

Lincoln said "Government is of the people, by the people, and for the people". People, people, people--we have created our own "mess", and only we, the people, can get us out of the "mess".
Answered By: Baby Poots - 11/30/2008
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