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Jewish World Review March 12, 2001 / 17 Adar, 5761

Michelle Malkin

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Consumer Reports

Ralph & George & Fannie & Freddie -- HAVE pigs grown wings? Is it snowing in Hades? Ralph Nader actually said nice things about President Bush. The devil's tail must be blue with frostbite.

In an opinion piece Nader co-authored for the Wall Street Journal on Wednesday, the standard-bearer of the Green Party gave "two cheers" to Bush for his efforts to curb corporate welfare. "If it took Richard Nixon to go to China, could George W. Bush be the president who ends corporate welfare as we know it?" Nader asks. "That doesn't seem likely. But in a budget outline that offers little reason to smile to those concerned about the concentration of corporate power, the Bush administration has offered a glimmer of hope on the corporate-welfare front."

Among the Bush administration's targets are the Overseas Private Investment Corp., the Export-Import Bank and the Advanced Technology Program -- three "corporate-welfare poster children" that receive millions of dollars in taxpayer-funded loans, loans guarantees, budget support, and research subsidies. These spending cuts are welcome news not only for anti-corporate leftists like Nader, but also for fiscal conservatives who oppose government meddling with the free market.

There is, as Nader notes, still "much, much more to do to rein in corporate welfare." Nader lists several federally-funded programs that "hurt the environment," but he forgot to mention two of the fattest corporate welfare targets on the block: Fannie Mae and Freddie Mac. Known as "government-sponsored enterprises," Congress chartered Fannie Mae and Freddie Mac to boost home ownership. Private competition is hard to come by, since the two institutions benefit from a wealth of unfair advantages. These invincible financial giants - both private companies and members of the Fortune 500 -- receive an estimated total of at least $6.5 billion a year in hidden taxpayer subsidies.

A new congressional report, due later this spring, is expected to show that federal support for the two quasi-public lending corporations has risen to $10 billion annually.

Republican Sen. Phil Gramm of Texas and GOP Rep. Richard Baker of Louisiana have led previous efforts to reform Fannie and Freddie and move towards privatization, but it looks like those efforts will go where they’ve gone under past administrations: nowhere. Sounding positively Clintonesque, Bush Treasury Secretary Paul O’Neill won’t even acknowledge that Fannie and Freddie receive government subsidies. "The market might give them a preferential rate because of the prospect of government support, but they don't really receive a subsidy," O'Neill said in a recent interview with Bloomberg Television. Uh-huh. Guess it depends on what the meaning of "really," is.

Fannie Mae and Freddie Mac are exempt from normal securities regulations, as well as from state and local income taxes. They are subject to lower capital requirements than other financial institutions in the private sector, and each receive $2.25-billion lines of credit with the U.S. Treasury - which means lower borrowing rates. These special pipelines give the institutions an implied federal guarantee available to no other private-sector competitor in the mortgage market.

This is a textbook case of government aid to dependent corporations that couldn’t do business without their taxpayer fix. It’s also a classic example of bipartisan back-scratching. Political appointees to the companies’ boards pocket millions in stock options to keep the pork flowing on Capitol Hill. Clinton-appointed board members at Fannie Mae include March Rich lawyer Jack Quinn and Janet Reno’s lieutenant at the Justice Department, Jamie Gorelick. At the helm of Fannie Mae is Franklin Raines, who served as director of the Office of Management and Budget under former President Clinton. Raines just happens to be a buddy of Bush Treasury Secretary O’Neill. "I consider Frank Raines to be a close personal friend of mine," O’Neill said glowingly in the Bloomberg interview.

So much for changing the culture in Washington. For Fannie Mae and Freddie Mac, it’s taxpayer-supported business as usual.

JWR contributor Michelle Malkin can be reached by clicking here.


03/08/01: Sen. Robert Byrd, ex-Klansman
02/28/01: Backstreet Boy’s off-key crusade
02/23/01: Don’t fund dubious reading programs
02/21/01: Freedom and "the Freak"
02/16/01: Mr. Bush, give back this church
02/14/01: Torricelli turns on his friends
02/12/01: The FICA tax fakeout
02/07/01: In search of honorable men
02/05/01: Ally McBeal’s trophy baby
02/01/01: Mel and Bill: Bosom buddies
01/29/01: Gun shows under fire
01/24/01: American citizenship for sale?
01/22/01: Look who supports AmeriCorps
01/17/01: Some questions about Elaine Chao
01/15/01: What America owes me
01/10/01: Temptation and trash TV
01/05/01: Cop-haters welcome in Hollywood
01/02/01: Ignoring a hate crime in D.C.
12/26/00: Use ultrasound to combat abortion
12/26/00: Pardon Clinton? Just say no!
12/21/00: Smacking down free speech
12/18/00: Brace yourselves for Floridation
12/14/00: Blame enviros for electric mess
12/11/00: UNICEF's deadly mission
12/06/00: The Amish vs. the feds
12/04/00: Downey and the Drug War
11/29/00: Let the sun shine on the Supremes
11/22/00: Peace prize for a murderer?
11/20/00: Baby Boom parents are asleep on the job
11/15/00: Fog horns of the Fourth Estate
11/10/00: Who cares about election fraud now?
11/08/00: Ms. Houston, you have a problem
11/03/00: The Million Mom Murmur
11/01/00: GOP revolutionaries head for the hills
10/27/00: My impeachment referendum
10/25/00: Gore’s Good Daddy Gambit
10/23/00: Tribulations of a dubious 'tribe'
10/20/00: Pharmaceutical butchers of Beijing
10/16/00: How the West was seized
10/12/00: Fight the anti-pesticide pests
10/10/00: Moochers at the multiplex
10/05/00: Pay for your own day care
10/02/00: Not every senior demands a handout
09/27/00: Racial hype at the Olympics
09/25/00: Watch the other Washington
09/20/00: Textbook case of media arrogance
09/18/00: New York: Land of medical pork
09/13/00: Voices from the womb
09/11/00: No cure for generational pain
09/08/00: Notes on a West Coast wilding
09/06/00: Race matters at Washington Post
09/01/00: For those who labor 24/7
08/28/00: There's something about Rudy
08/25/00: A conservative case against Napster
08/22/00: Death Row Marv mocks justice
08/18/00: The party of Maxine Waters
08/14/00: "Make-A-Wish" shoots down dreams
08/10/00: Who will stop Bill Lann Lee?
08/07/00: Emily Dickinson's lesson for rude drivers
08/03/00: Leave the slogans behind
07/31/00: Hey, GM: Build cars, not quotas
07/28/00: Stop milking The Juice
07/24/00: Silencing Jeff Jacoby
07/21/00: Score another one for TV execs who want to keep us brain-dead
07/17/00: Can somebody say McStupid?
07/12/00: Beware of Ugly Building Syndrome
07/10/00: The miracle of a lead pencil
07/07/00: Partying on the people’s dime
06/29/00: When "Indians" exploit their own
06/23/00: Kids in a public school daze
06/21/00: Fed up with Fannie and Freddie
06/19/00: D.C.'s gag order for Christians
06/16/00: Dads, daughters, and PETA's spoilsports
06/13/00: Tune out Eminem's pitiful "poetry"
06/07/00: "Pained" Dem leader Torricelli deserves to feel some; Why hasn't he?
06/05/00: Tom Green's hidden health-care lesson
06/01/00: Farming out the pork
05/30/00: The perils of medical quackery
05/26/00: Awarding medals by race is a disgrace
05/22/00: Have Simon & Schuster execs lost their minds!?
05/17/00: Sports plebes vs. plutocrats
05/15/00: Whitewashing Red China's record
05/12/00: Our mothers' hands
05/08/00: Focus on the real Waco
05/05/00: An Internet victim's sad story
05/03/00: Phony pooh-bahs of journalism
05/01/00: Zoo tragedy triggers dumb reaction
04/24/00: Ecoterrorists on the loose
04/19/00: Beware of Elian's psychobabblers
04/17/00: The truth about Erin Brockovich
04/13/00: In defense of an armed citizenry
04/10/00: Playing hardball with taxpayers
04/06/00: Read W.'s lips: More new spending
04/04/00: The liberal media-in-training
03/31/00: Sticking it to the children
03/28/00: Declaring war on HOV lanes
03/22/00: Clinton and the Echo Boomers
03/17/00: Is Bush a Liddy Dole Republican?
03/13/00: Katie and the politics of disease
03/10/00: Maria H, Granny D, and the media Z's
03/07/00: Bubba Van Winkle wakes up
03/03/00: Double standard for day traders?
02/28/00: Sluts and nuts --- and our daughters
02/24/00: Zoning out religious freedom
02/15/00: The Baby Brain Boondoggle
02/10/00: Buddhist temple untouchables
02/08/00: CDC: Caught Devouring Cash
02/04/00: Hillary's poisoned poster child
02/01/00: Corporate welfare on ice
01/28/00: The silly sound of silence
01/26/00: The Old Media meltdown
01/20/00: The pied pipers of KidCare
01/18/00: Our imperious judiciary
01/14/00: Tune out Columbine chorus
01/12/00: Dying to be an American
01/10/00: Time for smokers' revolt?
12/30/99: Reading, writing, PlayStation?
12/27/99: Fight money-grubbing mallrats
12/23/99: Christmas for Cornilous Pixley
12/20/99: Who will help the Hmong?
12/16/99: Shame on corn-fed politicians
12/13/99: EPA vs. the American Dream
12/09/99: Look behind the Pokemon curtain
12/06/99: Amateur hour in Seattle
11/30/99: Stop the Ritalin racketeers
11/23/99: Welfare for a sports fatcat
11/19/99: Jeb Bush's political ploy of the week
11/16/99: Ben & Jerry serve up junk science
11/12/99: A monumental waste of our veterans' resources
11/10/99: Tax-and-spend schizophrenia
11/05/99: Spooky Guy Haunts the Capital
11/02/99: Mourning the loss of the last Liberty Tree
10/27/99: AOL goes AWOL on parents
10/22/99: The persecution of Harry Potter
10/20/99: Don't doctor the law
10/14/99: The trouble with kids today
10/12/99: Pro-animal, pro-abortion, anti-speech?
10/07/99: Beltway press corps needs more skunks
09/30/99: ESPN overlooks athlete of faith, grace, and guts
09/27/99: Personal freedom going up in smoke
09/15/99: Farewell, "Miss" America
09/10/99: Will George W. work for a color-blind America?
09/03/99: Feminization of gun debate drowns out sober analysis
08/27/99: America is abundant land of equal-opportunity insult
08/10/99: Protect the next generation from diversity do-goodism
08/04/99: Sweepstakes vs. state lottery: double standards on gambling
07/21/99: "True-life tales from the Thin Red Line" (or "Honor those who sacrificed their lives for peace")
07/21/99: Reading, 'Riting, and Raunchiness?
07/14/99: Journalists' group-think is not unity
06/30/99: July Fourth programming for the Springer generation
06/25/99: Speechless in Seattle
06/15/99: Making a biblical argument against federal death taxes

© 2001, Creators Syndicate