Can Mitt Romney Lead the Rebirth of the American Revolution? — Charles Kadlec, Forbes.com
“The government does not create prosperity; free markets and free people do.”
Starting with that declaration, Mitt Romney last week delivered what could be the breakthrough speech of his candidacy for President of the United States. Speaking first at the University of Chicago, and then in his victory speech after winning the Illinois primary, Romney embraced “economic freedom” as the political philosophy that gives purpose to his run for the Oval Office.
The embrace of economic freedom has the potential to broaden Romney’s base among Republicans, Tea Party activists and independent voters while increasing the intensity of his supporters. As his distant second place finish in Louisiana shows, Romney’s proven competence alone is insufficient to energize the Republican base and may not be enough to win a fall match-up against President Barack Obama.
However, a clear and unapologetic advocacy of economic freedom would align the Romney campaign with the powerful political tide the Republican party rode to its landslide victory in the 2010 election, and that is fueling a rebirth of the American Revolution.
Romney used his speech to position economic freedom as the defining issue of the 2012 campaign:
“For three years, President Obama has expanded government instead of empowering the American people. He’s put us deeper in debt. He’s slowed the recovery and harmed our economy. And he has attacked the cornerstone of American prosperity: our economic freedom…
“This November, we face a defining decision. Our choice will not be one of party or personality.
“This election will be about principle. Our economic freedom will be on the ballot. And I intend to offer the American people a clear choice.” Keep reading »
Tim Geithner Covers for Corruption on Pennsylvania Avenue — Charles Kadlec, Forbes.com
Last Friday, Treasury Secretary Timothy Geithner charged in a Wall Street Journal op-ed that those who oppose the Obama Administration’s regulatory regime for the financial services industry “seem to be suffering from amnesia about how close America came to complete financial collapse under the outdated regulatory system we had before Wall Street reform.” Au contraire, Secretary Geithner, it is you who choose to ignore and misrepresent the lessons of the financial crisis by perpetuating the myth that the source of the crisis was a lack of regulation.
First, your essay glosses over the central role the federal government played in creating the crisis. In particular, the government through Fannie Mae and Freddie Mac directed $5.2 trillion (that is trillion with a “t”) of capital to increase the supply of mortgages. In addition, it passed a law that required banks to make billions of dollars in loans to individuals that were unlikely to pay off the loans, in the end with 0% down.
In 1998, Fannie Mae announced it would purchase mortgages with only 3% down. And, in 2001, it offered a program that required no down payment at all. Between 2001 and 2004, subprime mortgages grew from $160 billion to $540 billion. And between 2005 and 2007, Fannie Mae’s acquisition of mortgages with less than 10% down almost tripled. These loans are now known as “subprime” and “alt A” loans. At the time they were made, Fannie Mae and Freddie Mac encouraged their issuance by lowering their standards and buying them up from the now vilified mortgage brokers, S&Ls, banks and Wall Street investment banks.
This activity was not due to a lack of regulation or oversight as you claim. Both companies are under the direct supervision of a federal regulator and Congress. At the time these loans were being purchased by these two Government Sponsored Enterprises, their actions were defended by many in Congress who, led by Senator Chris Dodd and Congressman Barney Frank, saw such reckless lending as a successful government initiative. Keep reading »
When government agencies are free to “invest” billions of dollars in speculative ventures, political connections — and campaign contributions — inevitably are entangled with the decision making process. Green energy is just the latest example of how crony capitalism corrupts those who govern while providing the rationale for squandering billions of dollars taken from American tax payers.
President Obama has frequently justified his policies—and judged their outcomes—in terms of equity, justice and fairness. That raises an obvious question: How does our existing system—and his own policy record—stack up according to those criteria?
A Step Backward for Economic Freedom in 2012 — Edwin Feulner, Wall Street Journal
The world economy is in trouble, and governments are making things worse. Here’s the story, right out of the pages of the 2012 Index of Economic Freedom, published Thursday by the Heritage Foundation and The Wall Street Journal:
“Rapid expansion of government, more than any market factor, appears to be responsible for flagging economic dynamism. Government spending has not only failed to arrest the economic crisis, but also—in many countries—seems to be prolonging it. The big-government approach has led to bloated public debt, turning an economic slowdown into a fiscal crisis with economic stagnation fueling long-term unemployment.”