Yesterday morning on CNBC, Pennsylvania Democratic Representative Paul Kanjorksi exhibited yet more avoidance of responsibility for the mess at Fannie Mae and Freddie Mac.
With a straight face, Kanjorski accused 'Wall Street firms' of being culpable for the last several years of the housing finance bubble, totally excusing Fannie's and Freddie's involvement. What's more, Kanjorski actually said that Barney Frank had 'admitted he was wrong' to push the GSEs to buy mortgages made to ever poorer borrowers.
So, Kanjorski implied, everything's okay with Barney and he's to be held in high esteem.
Unbelievably, Kanjorski then said he personally favors creating 'hundreds' of little GSEs, so that having only a few go bust through securitizing bad mortgages wouldn't be so systemically crippling.
Called on to defend having any governmental role in housing finance, Kanjorski excoriated private lenders and mortgage pipelines for 'only being interested in the most profitable' parts of the business.
Let's see.
Fannie and Freddie bankrupted themselves at Congressional direction by securitizing bad mortgages. The result was to have far too many homes built and money lent on such homes. Because GSE's didn't have a profit motive.
Now Kanjorski is saying things would be worse if we had a financial sector in which housing was built and financed only because it was profitable for various vendors to do so.
If you wonder why there is so little business news outside of Washington anymore, Kanjorski exemplifies the reason.
Private enterprise, profit-driven economic activity and the sane, restrained economic system that develops are not trusted, nor wanted, by Washington's power brokers.
Instead, though they won't say it to us clearly, the Washington powers that be believe in nationalizing as much of our economy as possible, as soon as possible, e.g., GM, GSEs, TARP banks, AIG, health insurance and care.
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