News McCain's Plan for Presidential Debate #2 - Will He Succeed?

[LowlyPion]

Debate Transcript

http://www.cnn.com/2008/POLITICS/10/07/presidential.debate.transcript/

This was the point I remembered finding Obama the most polished, even though I think his answer approached the original question more obliquely than some might want.

"What don't you know and how will you learn it?"

Sen. Obama, you get first crack at that.

Obama: My wife, Michelle, is there and she could give you a much longer list than I do. And most of the time, I learn it by asking her.

But, look, the nature of the challenges that we're going to face are immense and one of the things that we know about the presidency is that it's never the challenges that you expect. It's the challenges that you don't that end up consuming most of your time.

But here's what I do know. I know that I wouldn't be standing here if it weren't for the fact that this country gave me opportunity. I came from very modest means. I had a single mom and my grandparents raised me and it was because of the help of scholarships and my grandmother scrimping on things that she might have wanted to purchase and my mom, at one point, getting food stamps in order for us to put food on the table.

Despite all that, I was able to go to the best schools on Earth and I was able to succeed in a way that I could not have succeeded anywhere else in this country.

The same is true for Michelle and I'm sure the same is true for a lot of you.

And the question in this election is: are we going to pass on that same American dream to the next generation? Over the last eight years, we've seen that dream diminish.

Wages and incomes have gone down. People have lost their health care or are going bankrupt because they get sick. We've got young people who have got the grades and the will and the drive to go to college, but they just don't have the money.

And we can't expect that if we do the same things that we've been doing over the last eight years, that somehow we are going to have a different outcome.

We need fundamental change. That's what's at stake in this election. That's the reason I decided to run for president, and I'm hopeful that all of you are prepared to continue this extraordinary journey that we call America.

But we're going to have to have the courage and the sacrifice, the nerve to move in a new direction.

Thank you.

 

[LowlyPion]

I equally blame the people that agreed to go along with the schemes. I guess I just expect people to own up and face the consequences of their actions. Stupidity is not an excuse in my book and I don't feel that taxpayers should have to bail someone out in those situations. But then I am not a nice person.

I don't disagree that people too are to blame. They were offered the temptations and they took the bite from the poisoned mortgage apple. But the apples were dangled so temptingly and with such encouragement. The American Dream that they are bathed in daily on their TVs. Their own home, the extra family room, the modernized kitchen, granite counters, more square feet than they can afford to heat or cool. Eden.

 

[NeoDevin]

I equally blame the people that agreed to go along with the schemes. I guess I just expect people to own up and face the consequences of their actions. Stupidity is not an excuse in my book and I don't feel that taxpayers should have to bail someone out in those situations. But then I am not a nice person.

I'm all for helping people that have suffered financial reversals beyond their control, but if a person is defaulting because they fudged on their loan application, too bad.

Purchasing and renegotiating the loans will help out two groups: The people who owe money that they cannot pay, and the people they owe the money to. There is a third group involved though, the people who loaned them the money in the first place (and then sold the mortgage to it's current owner).

On the third group, the lenders, we can call them immoral, but they weren't unintelligent, and they didn't break any laws. The borrowers were stupid enough to take out a mortgage they couldn't afford, and the owner of the mortgage were stupid enough to buy these high-risk mortgages. Both groups made poor business decisions and therefore must (should?) live with the consequences. If the government buys these mortgages and renegotiates, they are basically telling both people and corporations: ``You are not responsible for your own poor business decisions''. The whole idea of a bailout without first addressing the underlying causes of the problem (poor financial education for the borrowers, poor regulation on the lenders) is ridiculous. It's a stop-gap which will only postpone (and make worse) the inevitable crash.

Edit: Oh yeah, my reason for quoting Evo: I fully agree with what you posted (except that you're not a nice person). You (like me) just expect people to take responsibility for their own decisions. On the second part, I would extend it not only to people who fudged the loan application, but also to anyone who made a poor decision to accept, whether or not there was any fudging going on.

 

[BobG]

Purchasing and renegotiating the loans will help out two groups: The people who owe money that they cannot pay, and the people they owe the money to. There is a third group involved though, the people who loaned them the money in the first place (and then sold the mortgage to it's current owner).

On the third group, the lenders, we can call them immoral, but they weren't unintelligent, and they didn't break any laws. The borrowers were stupid enough to take out a mortgage they couldn't afford, and the owner of the mortgage were stupid enough to buy these high-risk mortgages. Both groups made poor business decisions and therefore must (should?) live with the consequences. If the government buys these mortgages and renegotiates, they are basically telling both people and corporations: ``You are not responsible for your own poor business decisions''. The whole idea of a bailout without first addressing the underlying causes of the problem (poor financial education for the borrowers, poor regulation on the lenders) is ridiculous. It's a stop-gap which will only postpone (and make worse) the inevitable crash.

Edit: Oh yeah, my reason for quoting Evo: I fully agree with what you posted (except that you're not a nice person). You (like me) just expect people to take responsibility for their own decisions. On the second part, I would extend it not only to people who fudged the loan application, but also to anyone who made a poor decision to accept, whether or not there was any fudging going on.

Right or wrong, there's a precedent for telling people and corporations, "You are not responsible for your own poor business decisions''. Bankruptcy is one precedent, although it's not without some negative consequences.

Companies bailing on their pension plans is another. Union leaders and corporations agreed to a plan that later put companies at a competitve disadvantage. The choice became punish workers that believed in those agreements and depended on them for their retirement; or punish retirees and current workers by forcing the companies out of business altogether.

When the going gets bad, the goal is to minimize damage. Fairness never enters into it.

You know the other option to the government buying bad assets is for the government to buy stock in the banks similar to the bailout of AIG. The banking industry is opposed to that plan for the same reason you'd rather have someone give you $100,000 for the junk in your garage that you need to get rid of rather than have someone take control of your house for $100,000 including control over whether they kick you out of your house or not.

The other option is getting pretty close to nationalizing the banking industry which is a pretty bad idea in principle (but so is having to bail out the banking industry for $700 billion).

 

[NeoDevin]

Companies bailing on their pension plans is another. Union leaders and corporations agreed to a plan that later put companies at a competitve disadvantage. The choice became punish workers that believed in those agreements and depended on them for their retirement; or punish retirees and current workers by forcing the companies out of business altogether.

The workers should have gotten it in writing, at which point they could take the company to court if the company didn't live up to their end.

When the going gets bad, the goal is to minimize damage. Fairness never enters into it.

And the much lauded free market of the USA is non-existant.

You know the other option to the government buying bad assets is for the government to buy stock in the banks similar to the bailout of AIG.

The other option is to let the market sort itself out, with some new regulations to prevent it from happening again.

The banking industry is opposed to that plan for the same reason you'd rather have someone give you $100,000 for the junk in your garage that you need to get rid of rather than have someone take control of your house for $100,000 including control over whether they kick you out of your house or not.

This example is valid if the house is worth only $100,000, and the junk is worth about $50.

The other option is getting pretty close to nationalizing the banking industry which is a pretty bad idea in principle (but so is having to bail out the banking industry for $700 billion).

Why is that a bad idea in principle? Maybe had it been nationalized from the start, this mess would never have occured?

 

[Astronuc]

Purchasing and renegotiating the loans will help out two groups: The people who owe money that they cannot pay, and the people they owe the money to. There is a third group involved though, the people who loaned them the money in the first place (and then sold the mortgage to it's current owner).

On the third group, the lenders, we can call them immoral, but they weren't unintelligent, and they didn't break any laws.

Actually the middle group are mortgage brokers or originators that set terms of the mortgage on behalf of the lenders. The government definitely needs to go after the brokers who made fraudulent loans, and any reseller or any lender that failed to do due diligence.

The FBI already has a widespread investigation going on, and I'm sure it will expand.

And in case anyone misunderstands - Evo is a very nice person.

 

[Evo]

Last night an analyst was saying that the plan to buy out mortgages sounded great but doubted it was feasible the way McCain stated it.

 

[jal]

Last night an analyst was saying that the plan to buy out mortgages sounded great but doubted it was feasible the way McCain stated it.

Poulson (sp?) was asked and he would not support it as stated and he has authority to do something else.

 

[NeoDevin]

And in case anyone misunderstands - Evo is a very nice person.

Agreed completely.

 

[edward]

Last night an analyst was saying that the plan to buy out mortgages sounded great but doubted it was feasible the way McCain stated it.

The odd thing about the plan to buy up mortgages from home owners is that the bailout has or soon will also buy them.

 

[Astronuc]

The odd thing about the plan to buy up mortgages from home owners is that the bailout has or soon will also buy them.

See my post #74 - it's not McCains proposal, but rather "it's Treasury Secretary Henry Paulson's proposal. It's the heart of the $700 billion plan.

According to Section 110 of the law, the government is going to buy up "troubled assets," including residential mortgages, and then do everything it can to "minimize foreclosures" by modifying the terms of the loans by reducing interest rates, reducing the principal or "other similar modifications."

In any event, McCain said that when he is president he would order the Treasury . . .

But McCain wouldn't be president until Jan 20. He would want to wait that long (104 days from today)? However, by that time, the troubled mortgages would hopefully be identified and the money would have started flowing, i.e. the money will be dispositioned before the next president takes office.

Ideally, Ben Bernanke, Henry Paulson and Neel Kashkari will have made a concerted effort toward the stabilization and recovery.

Kashkari Summary Biography - http://www.treas.gov/organization/bios/kashkari-e.html