George W. Bush, September 24, 2008, on one of the remedies for the current economic meltdown, from the transcript of his speech:
http://www.nytimes.com/...
Once this crisis is resolved, there will be time to update our financial regulatory structures. Our 21st-century global economy remains regulated largely by outdated 20th-century laws.
To be replaced by even more outdated 19th-century laws -- according to Eliot Spitzer.
Remember the untimely fall of Eliot Spitzer?
Which 20th-century laws?
The 1982 Garn-St. Germain Depository Institutions Act, an initiative of the Reagan administration, and largely authored by lobbyists for the S&L industry -- including John McCain's warm-up speaker at the convention, Fred Thompson? Officially described as "An act to revitalize the housing industry by strengthening the financial stability of home mortgage lending institutions and ensuring the availability of home mortgage loans."
Info lifted from Deviltower:
http://www.dailykos.com/...
Or, how about the legislative activities of Phil Gramm:
The 1999 Gramm-Leach-Bliley Act (GLBA), which allowed commercial banks, investment banks, and insurers to merge -- which would have been a violation of antitrust laws under Glass-Steagall, now made null by GLBA. Then Senator Gramm had, of course, received over $4.6 million from the FIRE sector -- Finance, Insurance and Real Estate industries. Once the Act passed, an influx of "megamergers" took place among banks and insurance and securities companies, as if they had been eagerly awaiting the passage of Gramm's Act.
Info lifted from:
http://losangeles.injuryboard.com/...
And, one of the last major deregulatory acts of the 20th century, Gramm's Commodity Futures Modernization Act, a 262-page amendment sneakily tucked into the omnibus spending bill signed into law in 2000.
This Phil Gramm bill led to:
The legislation contained a provision -- lobbied for by Enron, a major campaign contributor to Gramm -- that exempted energy trading from regulatory oversight. Basically, it gave way to the Enron debacle and ushered in the new era of unregulated securities. Interestingly enough, Gramm's wife, Wendy, had been part of the Enron board, and her salary and stock income brought in between $900,000 and $1.8 million to the Gramm household, prior to the passage of the Commodity Futures Modernization Act.
From the LA Times article above.
One must also be reminded of the fall earlier this year of Eliot Spitzer (Thanks to Thom Hartmann for this reminder) shortly after he had the gall to write:
Predatory Lenders' Partner in Crime: How the Bush Administration Stopped the States From Stepping In to Help Consumers
By Eliot Spitzer
Thursday, February 14, 2008; Page A25
Several years ago, state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders. Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive "teaser" rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks. These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets.
Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers.
Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government. Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many subprime lenders that were engaged in predatory lending practices. Several state legislatures, including New York's, enacted laws aimed at curbing such practices....
http://www.washingtonpost.com/...
Spitzer, further, castigates the Bush administration and cites his invocation of a 19th-century regulation:
Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.
Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.
In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.
Enter political operative Roger Stone, master of the black arts of politics:
Roger Stone: I tipped off FBI about Eliot Spitzer sex scandal
James Bone in New York
A political rival has admitted that he tipped off the FBI about the former New York Governor’s use of prostitutes, effectively ending Elliot Spitzer’s career in public office to score a victory in a bitter feud....
Stone ... is a self-confessed practitioner of political "black arts" who once worked during the Watergate era for President Nixon, planting a mole in the campaign of a Democratic presidential rival....
He helped to orchestrate the so-called Brooks Brothers riot in Miami, when angry Republicans in pinstriped suits shut down the 2000 presidential election recount in Dade County, Florida. Though a Republican, he also gave advice to the Rev Al Sharpton, the black civil rights leader, in his 2004 presidential campaign.
Mr Stone held a $20,000-a-month post last year as a political consultant to Joseph Bruno, the state senate majority leader and Mr Spitzer’s main rival in the New York legislature. He was forced to resign in August after he allegedly left an abusive telephone message for Mr Spitzer’s father.
http://www.timesonline.co.uk/...
It also strongly rumored that Spitzer had been spied on courtesy of certain provisions of the Patriot Act, and certain wiretapping activities (illegal at the time of performance, I believe) of the Bush administration.
One hopes that enough members of congress are not liable to blackmail by Bush and will be able to turn his (Bush/Paulson/Bernanke/Cox) bailout proposal down.