Crossposted from Flopping Aces

No agreement yet on the bailout plan:

Alabama Sen. Richard Shelby, the top Republican on a the Senate Banking Committee spoke briefly after meeting with congressional leaders, President Bush and both presidential candidates. He said that there is “no agreement” in congress on the bailout.

Shelby said he presented documents from top economists who were very critical of Henry Paulson’s plan. The economists who were all from top universities, said that Paulson’s plan was a “bad plan”, and would create more problems than it would solve, and was a rush to judgment.

Which is a good thing I believe (See Mata’s post below for more information on those economist views presented to the Congressional leaders). I have rarely disagreed with Bush much except on immigration and now this silly plan. Hopefully McCain can push through something that will really help instead of socializing our government any more then it already is.

Meanwhile Ed Morrissey writes about a LA Times article from 1999 that is pretty much a roadmap for how we got to this point:

this LA Times article from 1999 makes the case clearly — and maybe even more credibly, since it praises all of the stupidity and government intervention that created the bubble and the collapse. Clearly, this was not the fault of a free market out of control. Congress and the executive created this problem by extorting banks into poorly-considered lending practices under the threat of prosecution as “unfair lenders”. They compounded that extortion with an artificial mechanism to incentivize lenders by having GSEs buy the paper and resell it, with government imprimatur as its guarantee.

What does the article say?

It’s one of the hidden success stories of the Clinton era. In the great housing boom of the 1990s, black and Latino homeownership has surged to the highest level ever recorded. The number of African Americans owning their own home is now increasing nearly three times as fast as the number of whites; the number of Latino homeowners is growing nearly five times as fast as that of whites.

These numbers are dramatic enough to deserve more detail. When President Clinton took office in 1993, 42% of African Americans and 39% of Latinos owned their own home. By this spring, those figures had jumped to 46.9% of blacks and 46.2% of Latinos.

~~~

Under Clinton, bank regulators have breathed the first real life into enforcement of the Community Reinvestment Act, a 20-year-old statute meant to combat “redlining” by requiring banks to serve their low-income communities. The administration also has sent a clear message by stiffening enforcement of the fair housing and fair lending laws. The bottom line: Between 1993 and 1997, home loans grew by 72% to blacks and by 45% to Latinos, far faster than the total growth rate.

~~~

Lenders also have opened the door wider to minorities because of new initiatives at Fannie Mae and Freddie Mac–the giant federally chartered corporations that play critical, if obscure, roles in the home finance system. Fannie Mae and Freddie Mac buy mortgages from lenders and bundle them into securities; that provides lenders the funds to lend more.

In 1992, Congress mandated that Fannie and Freddie increase their purchases of mortgages for low-income and medium-income borrowers. Operating under that requirement, Fannie Mae, in particular, has been aggressive and creative in stimulating minority gains. It has aimed extensive advertising campaigns at minorities that explain how to buy a home and opened three dozen local offices to encourage lenders to serve these markets. Most importantly, Fannie Mae has agreed to buy more loans with very low down payments–or with mortgage payments that represent an unusually high percentage of a buyer’s income. That’s made banks willing to lend to lower-income families they once might have rejected.

But yeah, keep blaming Bush for this mess….just makes the Democrats look more and more foolish.

also:

McCain Staying In Washington

McCain staying in Washington, as he should:

To address our current financial crisis, John McCain suspended his campaign and returned to Washington, D.C., today to help build a bipartisan consensus for a proposal that would protect the American taxpayer.

Despite today’s news reports, there never existed a “deal,” but merely a proposal offered by a small, select group of Members of Congress. As of right now, there exists only a series of principles, including greater oversight and measures to address CEO pay. However, these principles do not enjoy a consensus in Congress.

At today’s cabinet meeting, John McCain did not attack any proposal or endorse any plan. John McCain simply urged that for any proposal to enjoy the confidence of the American people, stressing that all sides would have to cooperate and build a bipartisan consensus for a solution that protects taxpayers.

However, the Democrats allowed Senator Obama to run their side of the meeting. That did not work as the meeting quickly devolved into a contentious shouting match that did not seek to craft a bipartisan solution.

At this moment, the plan that has been put forth by the Administration does not enjoy the confidence of the American people as it will not protect that taxpayers and will sacrifice Main Street in favor of Wall Street.

The bottom line is that as of tonight, there are not enough Republican or Democrat votes for the current plan. However, we are still optimistic that a bipartisan solution will be found. Republicans and Democrats want a deal that will protect the taxpayers.

Tomorrow, John McCain will return to Capitol Hill where he will work with all sides to build a bipartisan solution that protects taxpayers and keeps Americans in their homes.

Some are trying to blame McCain for the deal not going through which is hogwash. Pelosi has already stated she would not try to pass this thing unless a majority of Republicans are behind it:

Pelosi (D-Calif.) has effectively sent the message that if she is going to jump off a cliff to rescue Wall Street, she wants House Minority Leader John Boehner (R-Ohio) and George W. Bush holding her hands when she leaps.

Pelosi made this scenario clear at a lengthy closed-door meeting of House Democrats on Tuesday. Many of those present said they took Pelosi’s message to mean that a “majority of the minority” needs to support the bill before she will bring it to the floor.

Which they clearly are not.

Then the Democrats excluded House Republicans from the discussions and gave Obama, of all people, a lead role at the meeting.

Doomed to fail from the beginning.

Btw, a good discussion on Hannity & Colmes tonight with Ann Coulter and Pat Caddell: