Liberty Maven

If you don’t already know it, the headline is an embellished version of a quote from an old school rap song circa 1985 by Rock Master Scott and The Dynamic Three called, “The Roof Is On Fire“. The song is almost as unbearable to listen to as it is to listen to Rock Master Bernanke and The Non-Dynamic Timmy Geithner. The non-embellished version of the headline begins about 4:25 into the song so feel free to use the bathroom during the first portion after clicking on the link above so you don’t have to sit through the entire song.

Meanwhile, I can just hear Ron Paul singing my embellished version of the song as he walks around Capitol Hill grinning from ear to ear thanks to the recent explosion of support for HR1207, his bill to audit the Federal Reserve. The news hit yesterday afternoon that there are now 88 cosponsors of the bill, an increase of 33 in the past 2 days. Perhaps all those “End The Fed” signs at the Tea Parties twisted the arms of some of Paul’s peers.

I finally got a response from my Congressman about HR1207. Congressman Frank Wolf responded by telling me he’d consider the bill when/if it comes up for a floor vote. Well, thanks for putting your neck out there Frank. My question was, “Will you either cosponsor or support HR1207?” I can only assume at this point his answer is no to both. Yet another reason to vote for whomever is opposing him in 2010.

During Freedom Watch yesterday Ron Paul claimed confidence that the bill would come up for a vote at some point this year. Judging by the recent explosion of support for it, I can see why he is a confident man. Perhaps not confident enough to break out into his own rendition of an old school rap song on the House floor, but we all know he’s singing on the inside.

Contact your representative right now and ask him/her to support HR1207 if they haven’t already done so. If they have, then call them up and thank them for supporting it. Ending the Fed has to start somewhere.

After contacting your lawmaker, be sure to preorder Ron Paul’s upcoming best seller, not suprisingly entitled, “End the Fed”.

Vern McKinley, at Cato.org, suggests that all the so called “tools” in the recently passed bailout legislation have implications all liberty seeking free marketeers should be concerned about. He steps through some of the more talked about provisions in the rescue legislation and examines what their implications are in the real world.

…a primary source for depositor fears has been their effort to acquire a number of what they have called “tools” to address the crisis, including the power to make up to $700 billion of asset purchases. The tools that Paulson and Bernanke have sought have had one characteristic in common: a lack of confidence in markets to resolve the imbalances caused by government policy in the financial markets. In overpromising the soothing effects of one tool, Paulson and Bernanke have then moved on to securing the next tool.

McKinley looks at the implications of other tools such as raising the FDIC insurance limit, the allowance for the FDIC to borrow unlimited funds from the Treasury, and Treasury injecting capital into the banks. He concludes with what we’ve learned from the bailout fiasco.

The big lesson here is that making major legislative changes in times of crisis leads to bad policy (recent examples in the financial sector are the Patriot Act and Sarbanes-Oxley). These “tools” are a euphemism for extraordinary powers that would not be considered in a calm market. They are largely preemptive, and aimed at avoiding bank failures.

I couldn’t agree more. Vern McKinley lives in my district and ran against the incumbent big spending Congressman Frank Wolf in the GOP primary earlier this year. McKinley didn’t win, unfortunately. If he were representing me in Congress during the bailout debate I wouldn’t have had to send emails and make phone calls to him pleading to vote against it. I would have already known that his vote would be an emphatic “NO”, unlike my current so called representative.

Read McKinley’s wisdom in its entirety here at Cato.org.

John McCain, Barack Obama, and the rest of the DC status quo are now exposed by Ron Paul’s “I told you so” and by the elephant sized pork sitting right there for all to read in the 451 pages of the Senate bailout bill. I’ve written recently how they don’t even try to hide it anymore. Instead they acknowledge the pork exists they then throw up their arms and say, “I disagree with it but, oh well, what can you do?” How about having some principle for a change?

John McCain speaks incessantly about reducing earmarks and “pork barrel spending”, but when it comes down to actually voting against it suddenly it becomes a necessary evil. Christopher Dodd reacted the same way today on CNN changing the subject and reiterating how important it is to pass the bailout bill (I refuse to call it a rescue bill).

Now the bill is being painted as a savior for the “credit crisis”. I wrote my Congressman here in Virginia, Frank Wolf, strongly encouraging him to vote against the bailout bill. He voted for it. I received a 5 page letter from him in the mail today full of excuses about why he voted for it. The general tone of the letter was “I know more than you do about this, so trust me, we need this bailout.” Also in the letter was this surprisingly accurate admission, “Access to credit is the lifeline of our economy.” This is so true it hurts.

Our entire financial and monetary system is fundamentally based on credit/debt/loans. Dollars are either printed out of thin air or loaned into existence courtesy of the Federal Reserve and fractional reserve banking. The more dollars out there, the less value those dollars have. As your dollars decline in value so does your standard of living.

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Here is the roll call vote on the financial bailout bill from the House of Representatives web site.

Check the list and see if your congress person listened to you. If they did not… well I think there is an election coming up soon where you can make your voice heard again. As it turns out my own Congressman, Frank Wolf did not listen. He will not be getting my vote on November 4th.

As the bailouts continue, I urge the Reader to remember the republicans who gave warning decades ago. One is Dr. Paul, another is the “First Ron Paul Republican” Vern McKinley.

by Jake, the Champion of the Constitution
Originally published September 29, 2008 at http://www.nolanchart.com/article5048.html

I recently came across a summary article (full version with sources here) from Vern McKinley on Freddie Mac and Fannie Mae published for the Cato Institute where he warned of its threat to the taxpayer in 1997.

“Although Freddie and Fannie are privately owned, they are what is known as government-sponsored enterprises (GSEs). GSEs don’t have to follow all the rules that true privately owned companies do: they don’t have to register their securities with the government, their securities receive special treatment for investment purposes, they don’t have to pay state and local income taxes and–most important–their government sponsorship gives them the aura of a fully guaranteed government entity. That final benefit means they save billions in borrowing costs, just as lenders are willing to offer low-interest student loans that are guaranteed by the government. That savings alone allows the GSEs to pocket about $2 billion per year, according to estimates by the Congressional Budget Office and the Treasury Department.”

“Allowing Congress to grant such special privileges is a bad idea. Those privileges, which are granted solely to Freddie and Fannie, crowd out other potential competitors in their market. Privately owned companies should not receive such preferred borrowing status, because it redirects investor funds into the middle- and upper-income housing market at the expense of other potential investments. Finally, the failure of either Freddie or Fannie could saddle taxpayers with a huge liability.”

“Congress should immediately revoke all the benefits of government sponsorship: clearly, Freddie and Fannie can be profitable without them. Eliminating special privileges will force mortgage markets to be truly competitive and will eliminate the possibility that the current system of government sponsorship will someday lead to yet another taxpayer-funded bailout.”

Vern also warned that these millions of dollar of savings were recycled into a “high-powered public relations and lobbying machine.” The GSEs also evenly supporting both Democrats and Republicans with $750 million in the latest contemporary election cycle at the time of his article. The article was published in 1998 in USA Today with the title “Privatize Fannie Mae and Freddie Mac.”

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Vern McKinley is challenging incumbent Frank Wolf in a Republican primary next Tuesday, June 10th in Virginia’s 10th congressional district. I live in this district and have heard some seriously scary things about Frank Wolf. I will not repeat them because I have no proof, instead I will try to focus on the issues where he and Mr. McKinley differ.

Vern McKinley is a principled Reagan Republican. I’m talking about the Reagan running for office, not the Reagan who forgot about cutting spending as well as cutting taxes. I suppose his Congress could be blamed for that. Frank Wolf used to be a Reagan Republican. He even ran supporting term limits in 1980. Almost 28 years have passed and he is still in office. Wolf, from the very beginning couldn’t keep a campaign promise.

On to the issues. If an issue is not listed it means that both McKinley and Wolf generally agree on the issue with a bit of room for differences in the margins. The point is to show where the candidates truly have a different world view.

Earmarks (AKA “bringing home the bacon”): Wolf likes to tout his SAFE commission, which is yet another Wolf investigative committee like he has proposed so many times in the past without much to show for it. The idea is to “examine” earmarking and figure out methods to curb it. This, in my view, is an establishment politician trying to have his cake and eat it too. It looks good on paper, but why did Wolf propose and get over $200 million in federal money in earmarks last year? Just another sly Wolf-like move, I guess. I hope people are paying attention this time.

McKinley on the other hand is almost running his entire campaign on “earmark” reform. He rightly criticizes Wolf on earmarks, saying that states shouldn’t use the federal government as an ATM machine. Funds for local projects should be raised locally. There’s some true federalism for ya. Bravo Vern.

Grades: Wolf gets an ‘F’ for being a shyster. McKinley gets an ‘A’.

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Awhile ago I signed up for Rep. Frank Wolf’s (10th District VA) email newsletter. I used to support this guy. Today I received an email that perfectly represents why I no longer support him. As a libertarian leaning conservative I take offense to more government spending. When the government spends what it doesn’t have, as it has been doing for many years now we suffer. It is this kind of behavior that helped give us the economic calamity we are now facing.

Frank Wolf is trying to have his cake and eat it too. In the very same email he advocates cutting spending and using those cuts for more spending. He, like many other elected officials, is trying to gain support for the projects he feels are most important. He advocates moving money from one area in to another, rather than actually cutting spending. It’s obvious to this 10th district voter he doesn’t really care about curbing spending overall. He puts a few good key words in this statement but in the end he’s not really advocating cutting anything. Here is the relevant quote:

Although we have been successful in raising awareness of the need for a strong STEM workforce and in authorizing innovative programs, we now face a serious challenge in funding these initiatives. As you will read, I believe that we must rein in explosive mandatory spending in order to ensure sufficient funding is available for this critical competitiveness initiative, among other programs. (Source: Wolf Email)

I don’t care how “good” the programs may or may not be. The point is Congressman Wolf is NOT interested in cutting spending. He’s only interested in continuing the budgeting shell game of typical establishment DC politicians. We need to replace him with someone with a fresh perspective on spending and government programs. Someone who will actually practice what he preaches. That person is Vern McKinley who is challenging him in the Republican Primary on June 10th in Virginia’s 10th District.