Top StoriesMay’s sharp fall in jobless numbers added to the greenness of the ‘recovery’ (or less bad) thesis; overnight June’s unemployment figures were so awful that they could have stunted at least, the wavering shoots.
Albrechtsen: recycling right wing drivel
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You’ve heard of the Friedman Unit; well News Ltd has its very own Albrechtsen Unit, the length of time — usually two to three weeks — that it takes for The Australian’s thickest reactionary to recycle some right-wing drivel from foreign commentators. For weeks right-wingers in the US have been responding to criticism of the deregulated nature of US financial markets by blaming the financial crisis on the Clinton Administration. This is a bit of a tradition amongst American conservatives — during the 1992 election campaign, Bush 41 was trying to blame America’s social ills on LBJ. In this case, they’re claiming the Clintonistas pushed banks into lending to low-income (read: minority) housing borrowers. Albrechtsen has belatedly picked up the theme, although not without having a go at Kevin Rudd first. Rudd, says Albrechtsen, won the election last year with his “brutopia” article in 2006. Quite an impressive feat for an article far more cited than read, and written when Rudd wasn’t even Opposition Leader. Evidently it somehow spread, like a highly contagious vote-changing virus, from the tiny readership of The Monthly to mainstream voters who switched to the ALP a year later. Never mind WorkChoices, or the Liberal leadership debacle, or constant interest rate rises — the punters were fooled by an obscure magazine article. God she’s a dill. But that’s just for starters. Albrechtsen’s real issue is to blame the financial crisis on the Democrats attempting to expand home ownership amongst low-income earners. She adds that to what she sees as a “populist” tradition of governments sticking it to the banks with regulations like restrictions on early-exit fees. Let’s put aside for a moment the fact that early-exit fees are an anti-competitive rort entirely unrelated to the “cost” of borrowing long-term money. The argument is nonsensical, particularly in relation to the alleged role of Fannie Mae and Freddie Mac. It was comprehensively demolished earlier this week in the Wall Street Journal. In particular, the alleged importance of the Community Reinvestment Act — a Carter-era law bolstered by Clinton in his first term — is wildly overstated. The CRA had minimal enforcement provisions. All it did was threaten US banks that if they failed to meet certain benchmarks repeatedly in lending to low-income earners, that might be considered if they ever applied to merge with another bank. The CRA was also aimed at increasing lending for minority-owned small businesses, but no one seems to have complained about inappropriate business lending, only lending for African-Americans and Hispanics to get a roof over their head. What conservatives can’t point to, ultimately, is any form of regulation that actually caused the crisis. No one put a gun to the head of US bank executives and made them lend to people without the means to repay loans. No one threatened dire retribution to investment bankers unless they packaged sub-prime securities. And no one compelled Standard and Poor’s and Moody’s to inexplicably and wholly irresponsibly rate those securities at AAA levels even when they didn’t understand the packaging mechanisms being used. But what this is really about is the sort of standard conservative goal-post shifting that occurs whenever they start losing a debate. The idea of encouraging home ownership amongst low-income earners is a long-standing conceit of the Right, and particularly of Margaret Thatcher. It was part of the conservative dream of a shareholding democracy, in which everyone can be happy if only they’d shut up, work hard, consume merrily and enjoy being a tiny cog in the giant capitalist machine. But come the time when the idea, taken up by the Democrats, turned out inevitably to have a downside — that not everyone can afford to own a home (and that, inconveniently, governments must provide some other mechanisms for ensuring low-income families can find somewhere to live) — it’s dropped like a hot CDO by conservatives, and becomes yet another excuse to attack the softness and social engineering of the Left. It’s shameless and completely lacking in any intellectual rigour. But we’re used to that from the likes of Albrechtsen. |
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17 Comments
Yes, and sad old Gerard Henderson wrote exactly the same drivel in yesterday’s Sydney Morning Herald. Neither of them have had an original thought in their lives.
Yes Bernard, she is a dill, but you should probably be playing the ball rather than the man/woman. Having said that, sometimes I wonder whether Albrechtsen and her ilk are actually real people, or just software packages programmed to react to all issues according to a limited, context-free, menu of right wing boilerplate. These guys are the last bastion of ideology.
Sounds like Bernard Keane could bash Gerard Henderson and Paul Kelly and the Washington Post’s Sebastian Mallaby with the same ‘logic’ (or more correctly lack thereof):
Paul Kelly also in today’s Oz:
“Writing in The Washington Post, financial analyst Sebastian Mallaby said: “The appetite for toxic mortgages was fuelled by Fannie Mae and Freddie Mac, the super-regulated housing finance companies” that are estimated to have bought one-third of the bubble’s junk bonds………….. Rudd’s speech means one of two things: either he does not understand the crisis despite his trip to the US and multiple briefings or he cannot restrain himself from resort to populist spin. The moral for Rudd is unmistakable. He is best when he addresses policy on merit and invites trouble when he indulges his “brutopia” philosophy.”
I thought Janet Albrechtsen’s piece was pretty good as well as informative all though I agree the ‘brutopia’ nonsense had naught to do with Rudd’s election win.
Get ready for the invective to follow…….
Albrechtsen and Piers really just write to a formula don’t they ?. They simply take any issue and approach it from a right wing angle. I regularly scan their headline or first paragraph and instantly know what they will be saying. It saves a lot of time and every now and then you can read one of their rants and will be proven completely correct. Perhaps it’s just written into their contracts that they must take that stance. I therefore put myself forward-even though I don’t believe a word of the stuff they write-as someone who could fill the post if either becomes ill or the job becomes vacant. I’d gladly churn out this right wing stuff for cash-no worries.
JamesK would be surely be suitable as well and could be a threat to my canditure as he believes in this nonsense and could be a step ahead of me.
These nutters really just pander to one market, preach to the converted and so on. A bigger worry is dear old Gerard and the esteemed Peter Faris QC who also believe all this tosh and appear to be reasonably intelligent blokes.
So let me see if I’ve understood this Left-liberal opinion piece with its undertones of longing to return to the “good ol’days” in Bulgaria, when money was just a dirty capitalist word . Those terrible, money hungry, free market conservatives allowed the major lending institutions of the richest nation on earth to lend to the disadvantaged, with no hope of servicing the debt long term, because they secretly wanted to exploit these minorities, largely blacks and hispanics. Why? Well, to make money! Bernard, Benny, are you guys for real? Too much sun in Havanna? Chasing woof again, Bernard?
Writing in Tne New York Times Business Section, Sept 30, 1999, in an article entitled ’ Fannie Mae eases credit to aid mortgage lending’, Steve Holmes wrote, ” Fannie Mae, the nations biggest underwriter of home mortgages, has been under increasing pressure from the Clinton adminstration to expand mortgages to low and moderate income people..” “Fannie Mae has expanded home ownershio for millions of families by reducing down payment requirements..said Franklin. D. Raines, Fannie Mae’s chairman and chief executive officer.”
Not Franklin. D. Raines? Now, adviser to Obama?
Benny, tell me you’re not lecturing in Political Science 101, ‘Why the revolution failed’ at my alma mater. Maybe Bernard could join the staff, commencing a course ‘Journalism for the Proletariat.
Academia always has a place for you old socialists. Its about as far from the real world as you could get.
Janet who ?
Bernard thanks for mentioning the push factor neglected in the debate as far as I can see: people are made desperate for home ownership when the market and/or the state fails to provide a respectable alternative
I mean when no public housing is being built and rents are going through the roof demand for home ownership is going to go up, at least until people start losing their jobs
Responsible social policy meets economic good sense with a large centrally financed and organised program of well-designed and quality built public housing
It’s not exactly revolutionary (or Bulgarian John!!) as it happens in many places in Europe and once upon a time before neoliberalism happened in Australia too
Poor John James: He doesn’t, and never will, understand anything. I have a theory which makes as little sense as any other theory. Albrechtson, Bolt, Kelly, Piers Ackerman, and the nearest office labourer, are members of the same witches coven. they get OS printouts, then they slice them up by sentences prior to giving them to their fellow witches in Achtung’s land to read. When a bell sounds; they have to paste in whatever is within two feet of their computers. Thus explaining la comedia infinitiva de la vida para desarrollarles la verdad suyas. Ademas la tragedia de las vidas mismas. Or something like that.
Phil: People of the extreme-right don’t have any productive thoughts, neither can they create. They merely react. For a particularly horrible example of this, read Andrew the bolter, in this morning’s HS. It’s about Bill Henson and should be mandatory reading for 12 year olds, as to how not to write if they want to be believed.
I agree we ( the community ) should help people get affordable housing. Sydney has a number of ‘housing commission’ regions.Areas of public housing which are ghettos, with festering unemployment and resentment.The Subprime debacle is the flip side of the same coin, throwing money at those unable to service the debt. What governments can and should do is facilitate wealth creation that results in real employment and training opportunities. Give people the chance to lift themselves up. Thats what Noel Pearson is saying about Indigenous Australians. The Left’s welfare/nanny state is a disaster. Its killing Indigenous Australians. This subprime mess is just an Amercian version of the same Democrat/Left wing mind set.
A SNL skit pulled from NBC and YouTube: The Soros/Sandler bailout satire which would seem to back Albrechtsen! … Whatever your political persuasion It is excellent:
http://patdollard.com/2008/10/it-is-here-the-banned-snl-skit-cannot-hide-from-louie/SNL’s
Hey Bernald, I have posted a link to a former columnist from Crickey who today in The Australian wrote that it was
“US financial institutions were encouraged to make loans to people who should not have got them under threats of fines for discrimination.
Freddie Mac and Fannie Mae were pressured by Democrats in Congress to take on billions of dollars of securities backed by sub-prime loans. Wall Street simply responded to this bit of social engineering by creating products. Things went bad.”
I wonder do you think that Christian Kerr is “….shameless and completely lacking in any intellectual rigour”
http://www.theaustralian.news.com.au/story/0,25197,24468260-7583,00.html
jack old boy read some of kerr’s past copy for crikey and the Oz if the cap fits wear it.
James k a skit from youtube? What’s next? Mad magazine?
Low income Americans defaulting on their mortgages played a part in triggering the crisis, but the reason this has blown out into a systemic global financial crisis is due to the volatile and opaque nature of the $700 trillion shadow economy - financial derivatives. Warren Buffet called them out as “financial weapons of mass destruction” in one of his annual reports a few years ago and wouldn’t go near them. He knows (as should any economist) that all market economies run on boom-bust cycles, and could see that whatever triggered the next downturn would set off the waves of cascading destruction as all of the players would be forced to unwind their positions. Rudd got it right, this truly is an epic tale of greed.
Its interesting that Janet Albrechtsen preaches free markets and individualism yet sits on the ABC board. When will she tell us how much she makes from this gig, compared to how many hours she spends doing it? Ron Brunton, former member, has revealed that board meetings involved silver service meals from a butler; we should have more details about the cost of this as we’re paying for it.
As well, her article doesn’t mention that her husband makes millions plus a year as a corporate lawyer for one of the big banks, so as Stephen Mayne correctly points out, she should disclose this when she starts discussing the poor put upon banks.
Time for full disclosure Janet! ! ! ! !
Further comprehensive demolitions of the Albrechtsen blame-the-Democrats lie:
http://bigpicture.typepad.com/comments/2008/10/misunderstandin.html
http://www.slate.com/id/2201641/
It looks like a certain very childish Crikey commentator is finally being ignored by other commentators….and about time too.
How anyone can deny that greed did not play a part in the chain of events in america has probably never lived in america (and been mercilessly solicited to take out a credit car/loan/mortgage), and is extremely naieve or disingenous . Albretchson is scrambling for a left-wing conspiracy to pin the blame on what really boils down to a boom and bust cycle, and a particulary extended boom, fuelled by unprecedented growth, speculation, sub-prime investment/financing/packaging (whatever), bad debt and over-consumption. Pity that this time there is so much more to blow up, really, in a nuclear fashion. But everyone’s implicated, left and right, to varying degrees, so to put it down to carter/clinton/left do-gooders etc is just laughable.