UTEP class

October 12, 2008

Hey, UTEP.  Just for my own gratification, could someone let me know what class it is that is using which material from Millard Fillmore’s Bathtub?


Obama didn’t start the sub-prime mortgage crisis

October 12, 2008

The intensity of the rabid attacks on Barack Obama is troubling. The issues grow more bizarre, the links to Obama grow more tenuous, and the shouts more shrill.

And that’s from the reasonable opponents of Obama.

For example, over at the oddly-named IUSB Vision Weblog (Indiana University – South Bend), there is much yammering about how Barack Obama personally is responsible for the sub-prime mortgage industry collapse, because he represented an ACORN client in a redlining case and won the decision from the judge.

From there, the story trails off into a rabbit warren of wild conspiracy theories and the granting of supernatural powers to Obama (though the authors wouldn’t admit it’s supernatural). For example, there is this post about a letter Sen. McCain signed urging some action on oversight of federal mortgage refinancers.

The authors stoutly defend their bizarre claim that Congress is the agency responsible for the regulation of Fannie Mae and Freddie Mac through the OFHEO, Office of Federal Housing Enterprise Oversight. Congress maintains its usual oversight over the executive branch agency, but it is, after all, an executive branch agency. Think about your high school civics classes: Separation of Powers, Checks and Balances.

Congress is not the superintendent of OFHEO

Here is OFHEO’s mission statement — notice no reference to being in Congress’s chain of command:

OFHEO’s mission is to promote housing and a strong national housing finance system by ensuring the safety and soundness of Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation). OFHEO works to ensure the capital adequacy and financial safety and soundness of two housing government-sponsored enterprises (GSEs) — Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac are the nation’s largest housing finance institutions. They buy mortgages from commercial banks, thrift institutions, mortgage banks, and other primary lenders, and either hold these mortgages in their own portfolios or package them into mortgage-backed securities for resale to investors. These secondary mortgage market operations play a major role in creating a ready supply of mortgage funds for American homebuyers. Combined assets and off-balance sheet obligations of Fannie Mae and Freddie Mac were $4.2 trillion at year-end 2005.

Fannie Mae and Freddie Mac are Congressionally-chartered, publicly-owned corporations whose shares are listed on the New York Stock Exchange. Under terms of their GSE charters, they are exempt from state and local taxation and from registration requirements of the Securities and Exchange Commission. Each firm has a back-up credit line with the U.S. Treasury.

OFHEO’s oversight responsibilities include:

Conducting broad based examinations of Fannie Mae and Freddie Mac; Developing a risk-based capital standard, using a “stress test” that simulates stressful interest rate and credit risk scenarios; Making quarterly findings of capital adequacy based on minimum capital standards and a risk-based standard; Prohibiting excessive executive compensation; Issuing regulations concerning capital and enforcement standards; and Taking necessary enforcement actions.

OFHEO is funded through assessments of Fannie Mae and Freddie Mac. OFHEO’s operations represent no direct cost to the taxpayer. In its safety and soundness mission, OFHEO has regulatory authority similar to such other federal financial regulators as the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, the Office of Thrift Supervision and the Board of Governors of the Federal Reserve System.

The legislation that established OFHEO also requires Fannie Mae and Freddie Mac to meet certain affordable housing goals set annually by the Secretary of Housing and Urban Development. These goals specify the share of mortgages that the two GSEs are required to purchase annually from low-income, moderate-income and central-city homebuyers.

And, explaining its role in mortgage refinance regulation:

OFHEO was established as an independent entity within the Department of Housing and Urban Development by the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (Title 13 of P.L. 102-550). The agency is headed by a Director appointed by the President for a five-year term.

OFHEO’s primary mission is ensuring the capital adequacy and financial safety and soundness of two government-sponsored enterprises, the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). Fannie Mae and Freddie Mac are congressionally-chartered, publicly-owned corporations whose shares are listed on the New York Stock Exchange.

Fannie Mae and Freddie Mac are the nation’s largest housing finance institutions. They buy mortgages from commercial banks, thrift institutions, mortgage banks, and other primary lenders, and either hold these mortgages in their own portfolios or package them into mortgage-backed securities for resale to investors. These secondary mortgage market operations play a major role in creating a ready supply of mortgage funds for American homebuyers. Combined assets and off-balance sheet obligations of Fannie Mae and Freddie Mac were more than $4.2 trillion at year-end 2005, which represents over 40 percent of mortgages outstanding.

In fulfilling its role in the secondary mortgage market, OFHEO promotes housing and a strong national housing finance system.

OFHEO’s oversight responsibilities include the following:
– Conducting broad-based and targeted examinations of Fannie Mae and Freddie Mac
– Making quarterly findings of capital adequacy based on a minimum capital standard and a risk-based capital standard
– Administering a risk-based capital standard, using a “stress test” that simulates interest rate and credit risk scenarios
– Prohibiting excessive executive compensation
– Issuing regulations concerning capital and enforcement standards
– Taking necessary enforcement actions
– Issuing an annual Report to Congress on the financial and operational condition of the Enterprises

OFHEO is funded through assessments on Fannie Mae and Freddie Mac. OFHEO’s operations represent no direct cost to the taxpayer.

The website for the agency is clear that it resides in the Department of Housing and Urban Development (HUD), though it is an independent agency whose director is appointed by the president for a five-year term. When I posted this information at IUSB Vision, however, it was censored. Instead, I got this charming response from the immoderator:

Ed – Stop lying,

You did not read the links. You need to start reading at OFHEO.gov and go and read the links I provided. OFHEO reports to Congress, not the administration. It is a fact. Deal with it. All you have to do is go read on their site THEY will tell you.

Charming fellow. He has censored all of my comments since then. At one point he was lecturing me that I didn’t know the organization. I pointed out to him that the Constitution makes clear the lines of organization in this case: OFHEO is an independent agency within the executive branch. It works closely with the Secretary of HUD. The organization charts show it is not a Congressional agency.

Similarly, this fellow is convinced that Obama, as a lawyer, made the federal courts dance to his tune. He appears to have no understanding for how federal courts work, nor for how a federal judge would regard any attorney acting as arrogantly as they claim Obama did.

Object lesson: You cannot reason a person out of a position he did not get to by reason in the first place.

Election, come soon!


Teacher Appreciation Week 2008, October 11-19

October 12, 2008

Show a teacher some sort of appreciation this week, will ya?

Barnes and Noble offers 25% off of most books for personal or classroom use, and 10% off of CDs and DVDs, to teachers.  Teachers, you can buy your own appreciation gifts.

Barnes and Noble logo for Educator Appreciation Week 2008

Barnes and Noble logo for Educator Appreciation Week 2008

Starbucks in Dallas offered a free cup of coffee to teachers every Monday in September.  What other goodies are there out there for teachers?

Dallas teachers are looking for good buys.  Layoff announcements should come this week — Educator Appreciation Week.

Is there an Academy Award for irony in a supporting role?

Quote of the moment: Book of Proverbs, on winking

October 12, 2008

12 A scoundrel and villain,
who goes about with a corrupt mouth,

13 who winks with his eye,
signals with his feet
and motions with his fingers,

14 who plots evil with deceit in his heart—
he always stirs up dissension.

15 Therefore disaster will overtake him in an instant;
he will suddenly be destroyed—without remedy.

Proverbs 6 (New King James Version)

9 The man of integrity walks securely,
but he who takes crooked paths will be found out.

10 He who winks maliciously causes grief,
and a chattering fool comes to ruin.

11 The mouth of the righteous is a fountain of life,
but violence overwhelms the mouth of the wicked

Proverbs 10

29 A violent man entices his neighbor
and leads him down a path that is not good.

30 He who winks with his eye is plotting perversity;
he who purses his lips is bent on evil.

Proverbs 16

‘We don’t got no stinkin’ education. We don’t need no stinkin’ education!’

October 12, 2008

My family’s heritages are migrant and education. By that I mean that moving someplace else for a better life, and getting the kids into better schools, has been a tradition running back at least 6 generations. My paternal grandfather was a seaman in the British merchant marine. He married a woman in Guyana, then moved the family for a job in the stockyards in Kansas City, a better place to raise kids. His children became nurses, politicians, law enforcement officers, successful trucking magnates; his grandchildren are doctors, lawyers, nurses, business executives, and teachers — one Rhodes Scholar. I am second-generation American on my father’s side.

My maternal grandfather was a farmer of great skill. He moved from Provo, Utah, to the frontier town of Manila, Utah, then to Delta, then to Salt Lake City, in a quest for riches from farming. Deciding that wouldn’t work, he took a job with Utah Oil Co., a company that was eventually merged into Standard of Indiana and now, British Petroleum. His children all graduated from high school, except for the daughter lost in infancy. Several went on to college. They became construction company owners, contractors and engineers, railroad engineers, small company entrepreneurs and retailers. His grandchildren are physicians, lawyers, business executives, successful salesman, investors — and a couple of good old boys who scrape by (every family has some). My grandfather was second-generation from pioneers, people who moved their families west in wagons, or if necessary, on foot and pushcart. They were people who fought Indians sometimes, and died in those fights and in the migrations. They left legacies in the towns named after them, and in their records as educators — both my maternal grandparents were schoolteachers early on, many of their cousins were college professors, one a college president.

Education in our family was always viewed as a ladder to personal success, to a good life, if not always a key to economic well-being. Especially in the case of my maternal grandparents, there was great assistance from the Latter-day Saint emphasis on education.

If I had to typify their version of the American dream, certainly a huge part of that dream involved the kids getting educated well beyond their parents, and getting a better life as a result.

Education was a part of the American dream from pre-Revolution days. Foreign visitors often commented that in America the crudest of men read the newspapers and discussed politics with vigor and earnestness absent in other nations. Education was the cornerstone of freedom, in the view of Thomas Jefferson and James Madison, and as demonstrated by Benjamin Franklin, Alexander Hamilton, and George Washington.

Sometime in the 1980s, I think, the tide changed. Certainly the Reagan Revolution had something to do with it. Cuts in Pell Grants, the grants that got thousands of kids into college, were a signal that education was no longer valued as it once was. One by one the federal government stripped away some of the most important building blocks of our modern society, things like the GI Bill, which had provided America with a highly-trained, highly-skilled corps of engineers in the 1950s. Those engineers invented the infrastructure to our nation that now crumbles, and they invented the industrial processes, and sometimes the industries, that we now use daily. Transistors, which make computers possible on the scale we have today, were invented and developed into powerful “cogs” for machines that do what had not even been dreamed of 40 years earlier.

I can’t tell you exactly when the tide turned, but I can tell you when I first realized it had. After staffing the Senate Labor Committee for most of a decade, I escaped to the President’s Commission on Americans Outdoors, a good place for a budding environmental lawyer to work, I thought at the time. The chairman of the commission was Tennessee Gov. Lamar Alexander (now senator from Tennessee). Lamar had two big projects in Tennessee that he pinned his hopes for the state upon. Both were influenced in no small part by his work trying to recruit auto manufacturers to build production facilities in Tennessee.

Nissan and Toyota had levelled with him: Tennessee looked good, but for two things. First, there were few good ways to get products like automobiles out of the state to markets they needed to be sold in. Second, Tennessee’s education system wasn’t providing the highly-educated workers the car makers needed to run highly-sophisticated machinery in a fast-moving, just-in-time inventory system that produced high quality products at lowest cost.

Alexander responded with one initiative to build good roads out of Tennessee to major markets. He called that initiative “Good Roads.” He responded to the education needs with a program designed to plug money and support into Tennessee schools to improve education, bolstered by the report of the Excellence in Education Committee in 1983. He called that initiative “Good Schools.” In retrospect, those were good places to focus development efforts. Tennessee got at least one Japanese company to locate a plant there, and snagged the much-desired Saturn production plant of General Motors.

The Commission had some hearings in Tennessee. I was along on one of those hearings, and I was with Alexander when he was met by a Tennessee constituent who just wanted to talk to the governor. Alexander, being from Tennessee, hoping to keep his election chances good, and being a good governor, agreed to give the man and his wife a few minutes — I watched. The constituent complained about all the changes coming to Tennessee. He complained about the costs of the roads, and the costs of improving the schools. He worried about taxes, because, he said, he didn’t make a lot of money. Alexander assured him that his taxes would not rise much if any at all, and that especially the education part of the program would benefit all Tennesseans. “Do you have children?” Alexander asked the man.

He responded that he had two kids, both in their early teens. And then he said something that just stunned me: “You know, I’ve gotten by pretty good with my 8th grade education all these years, and I don’t see why my kids need to have any more than that. I’m not sure we need Good Schools.”

To Lamar Alexander’s everlasting credit — or shame, if you’re very cynical — he didn’t strike the man down. Alexander spent a few more minutes explaining the benefits the man’s children would have from better education, and he closed off telling about his meetings with car company executives who made it clear that they wanted to hire only good students who had graduated from good high schools, and maybe who had enough college that they could do the complex mathematics to run big machines. Alexander asked the man for his name and address, said his opinion was very important to him, and promised to get back in touch.

I suspect Alexander did contact the man later. His office tended to work very well on such matters as constituent contacts.

But I’ll wager he didn’t change the man’s opinion about education.

Sometime in the mid-1980s many Americans began to look on education as unnecessary, as expensive, and as “elitist” in a new, derogatory sense. Instead of education being something blue-collar workers hoped their children would earn, it became something blue collar workers felt oppressed by, somehow.

From that commission, I moved to the U.S. Department of Education, in Bill Bennett’s regime. Over the next few months I observed the same anti-education phenomenon playing out in debates about school reform in dozens of states. Then I got out of government and into private business, where education was demanded, and I only occasionally worried about the drama I had seen.

The past few weeks, especially since the nomination of Sarah Palin, have heightened my fears about the loss of the shared dream of better education for our children. It was part of the American psyche, woven into the fabric of our government from the “Old Deluder Satan” law in Massachusetts, which required towns of any size to set up some kind of school, through the Northwest Ordinances, which set aside sections of every township to be used for the benefit of public education, through the settlement of the west where nearly every town with a kid in it built a school — schools were built in Utah before many pioneers had houses to get them through the winter — through the dramatic rise of public education that helped knock out child labor, and that provided us with truly American armies and navies to get us out on top of two world wars.

Now comes conservative columnist David Brooks to explain how this process has been aided and abetted, if not intended, by the Republican Party, “The Class War Before Palin.”

In 1976, in a close election, Gerald Ford won the entire West Coast along with northeastern states like New Jersey, Connecticut, Vermont and Maine. In 1984, Reagan won every state but Minnesota.

But over the past few decades, the Republican Party has driven away people who live in cities, in highly educated regions and on the coasts. This expulsion has had many causes. But the big one is this: Republican political tacticians decided to mobilize their coalition with a form of social class warfare. Democrats kept nominating coastal pointy-heads like Michael Dukakis so Republicans attacked coastal pointy-heads.

Over the past 15 years, the same argument has been heard from a thousand politicians and a hundred television and talk-radio jocks. The nation is divided between the wholesome Joe Sixpacks in the heartland and the oversophisticated, overeducated, oversecularized denizens of the coasts.

What had been a disdain for liberal intellectuals slipped into a disdain for the educated class as a whole. The liberals had coastal condescension, so the conservatives developed their own anti-elitism, with mirror-image categories and mirror-image resentments, but with the same corrosive effect.

It’s a sobering piece. Please read it.

We remain a nation of migrants, a nation that migrates. We remain a nation that desires economic success and is willing to move to get it. Have we lost the good sense to remember that education improves our chances at success? Does Brooks explain the entire motivation for the War on Education?

What do you think?

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