The two most important economic stories in the last 30 years have quietly slipped past us. The first is the Fed bailout of Freddie and Fannie. The second is the joint Treasury/Federal Reserve request to Congress for increased regulatory powers.
The cornerstone of NeoConservative economic philosophy and policy is that free markets are self regulating. They have spent decades dismantling federal regulations and enforcement of all market activity based solely on the dogmatic worship of free market capitalism.
In the past week they have not only been forced to acknowledge the failure of this dogma, but are actually embracing the progressive philosophy and policy of government regulation and control of business misconduct.
Lord have mercy. Thirty years of Republican NeoCon dogma down the drain and nobody even notices (and for those of us from Orange county whose parents embraced the John Birch Society lunacy, this goes back to the 1950's).
The very heart of Republican economic philosophy is that markets are fully and totally self-regulating. They claimed the marketplace itself would control and weed out misconduct and inefficiency thus eliminating the need for federal and state regulation except to enforce the sanctity of contracts.
On Monday the Federal Reserve Board, the heart and soul of the NeoCon financial castle, unanimously voted to destroy their own dogma.
CNN reported,
The new rules will apply to all mortgage lenders, not just those supervised and examined by the Fed. All but one requirement will take effect Oct. 1, 2009. However, board members said they will continue to work on further oversight of the mortgage industry.
"The proposed final rules are intended to protect consumers from unfair or deceptive acts and practices in mortgage lending, while keeping credit available to qualified borrowers and supporting sustainable homeownership," said Fed Chairman Ben Bernanke.
"Besides offering broader protection for consumers, a uniform set of rules will level the playing field for lenders and increase competition in the mortgage market, to the ultimate benefit of borrowers."
Sounds to me just like something a bunch of hated liberal pansies would say.
There can be no clearer statement that the market failed to regulate it self. And the NeoCon house comes tumbling down.
That by itself is a Hugh story, but even more significant is the Fed bailout of the mortgage industry.
This is the part that boils my blood. I have no words that adequately express my outrage at these self-serving, arrogant sons-of-bitches who piously turned their backs on the victims of Katrina and now blithely impair hundreds of billions of taxpayer money because a little financial storm (its all in your imagination, you whiners) threatens themselves.
The rest of this post devolves into mindless rage about the Fed stepping in to bailout Freddie and Fannie compared to their sanctimonious proclamations about the victims of Katrina and has been deleted by the author.