President Bush has threatened to veto the bloated federal housing bill pushed by House leaders, saying it would reward special interests As John Berlau has noted, the bill could cost middle-class investors billions (such as people whose retirement accounts or mutual funds contain mortgage-backed securities). (The companies that issued risky mortgages typically don’t still possess them). That’s above and beyond the billions of dollars that its bailout of subprime borrowers will likely cost taxpayers.
The architect of the bill, Congressman Barney Frank, calls his own bill the payment of an economic “ransom,” admitting that it rewards irresponsible people by bailing them out. His excuses for paying this ransom are decidedly lame. Moreover, his bill contains political pork for left-wing special interest groups like La Raza and the National Urban League.