It was the highlight of the debate.

“I think (it’s) interesting the president just said something which — which is that on the day after the attack he went into the Rose Garden and said that this was an act of terror,” said Gov. Romney.

“I want to make sure we get that for the record because it took the president 14 days before he called the attack in Benghazi an act of terror.”

This was the now-infamous exchange where Romney could not believe what he was hearing. Are you out of your mind, Mr. President? Everybody knows you said no such thing. And then the moderator, Candy Crowley, really shocked the Governor: “He did in fact, sir.” You could hear the conservative cause, the “scandal” of Benghazi, broadside a bridge abutment. Mitt Romney had no idea Barack Obama had called the attack an “act of terror” the very next day, September 12th.

“No acts of terror will ever shake the resolve of this great nation, alter that character or eclipse the light of the values that we stand for. Today we mourn four more Americans who represent the very best of the United States of America. We will not waver in our commitment to see that justice is done for this terrible act. And make no mistake, justice will be done.”

Well that’s embarrassing. How did this happen? Billion dollar campaigns loaded with high-salary political sharks are not supposed to get caught flat-footed and clueless. Something went wrong.

What happened? In the closing months of the campaign, with Romney lagging badly in the polls, Americans were killed in a militia attack on the Benghazi consulate in Libya. And the wingnuts lost their minds. This was the greatest gift of campaign 2012 — Americans attacked and killed by violent Muslims. Perhaps even terrorists. Thank You, Ronaldus.

Before he even knew who or how many people had died, Mitt immediately hammered the president: “It’s disgraceful that the Obama administration’s first response was not to condemn attacks on our diplomatic missions, but to sympathize with those who waged the attacks.” The allegation was laughably silly. This sort of craven political behavior was ridiculous, if it wasn’t appalling.

So the circus continues. Though the truth is easily available to everyone, the right wing’s calculated outrage remains. Conservatives are no more closer to recovering their sensibilities than they were while watching the coffins return from overseas. Here was Ann Althouse blogging tonight’s debate:

. . Crowley helps Obama by saying “He did in fact, sir… He did in fact call it an act of terror. It did as well take 2 weeks or so for the whole idea of there being a riot out there about this tape to come out, you’re correct about that.” Jeez, Crowley is way overparticipating! And the audience applauds her!

. . [ADDED: We're checking the transcript on the Rose Garden speech and the word "terror" (or "terrorist" or "terrorism") is not in it! Am I wrong? That really tripped up Romney, so if he wasn't wrong, I condemn Crowley.][AND: He said "outrageous attack," but certainly nothing like "act of terror."]

Partisan hysteria, the stupefaction. Ann can’t read or watch a video in this state, so by all means give her a blog and let her fact check reality. Instapundit:

CANDY CROWLEY INSERTED HERSELF INTO THE DEBATE, OUTRAGEOUSLY, to break up Romney’s most dramatic moment, when Romney was questioning what Obama said the day after the attack in Benghazi. Obama had said he’d called the attack an “act of terror” and Romney was staring him down about it. Crowley broke up the showdown, saying “He did in fact call it an act of terror,” which took the wind out of Romney’s sails. We were advised to check the transcript, but the dramatic moment was lost. The transcript shows Romney was right, and Crowley and Obama were wrong.

And then the update: “ADDED: The phrase “acts of terror” does appear in the remarks…” Aw jeez. The scoreboard will reflect that there are now two professors of law who can’t comprehend a transcript. But wait: it’s ANN ALTHOUSE AGAIN. She’s covering for Glenn. What a talent she is, humiliating two wingnut sites simultaneously. The astute bloggers:

HUGE BREAKING NEWS: OMFG: OBAMA LIED AND CROWLEY SWORE TO IT: OBAMA DID NOT UTTER THE WORD TERROR AT THE ROSE GARDEN SPEECH!

OBAMA SAID AT THE DEBATE, THAT HE “CALLED THE ATTACK ON BENGHAZI AN ACT OF TERROR THE DAY AFTER THE ATTACK DURING HIS STATEMENT IN THE ROSE GARDEN” AND THE TRUTH IS HE MOST CERTAINLY DID NOT.

SO OBAMA LIED IN THE DEBATE – AND CROWLEY SWORE TO IT!

IF OBAMA DIDN’T LIE THEN HE’D HAVE NOT A FREAKIN. THING TO SAY.
REPEAT: ROMNEY WAS RIGHT ON THE FACTS AND OBAMA WRONG. OBAMA LIED TONIGHT.

UPDATE: OMFG HE DID SAY ACTS OF TERROR. THAT’S NOT THE SAME AS TERRORISTS HE LIED. Here was Breitbart’s crack at it:

Crowley, quite incorrectly, took Obama’s side and the crowd exploded.

Here’s what Obama said that day:

“No acts of terror will ever shake the resolve of this great nation, alter that character or eclipse the light of the values that we stand for.”

Context matters and the context here is that Obama connected this “act of terror” to … a mob action over a YouTube video — not a deliberate terrorist attack. Obama was using the term generically and it would be almost two weeks before he used it again.

The context of the quote isn’t in your allegations, it’s in the quote. Just read it above. But for that “two weeks before he used it again” nonsense, wrong again:

On September 13, at a campaign event in Las Vegas, Obama vowed to bring the killers to justice. He then added, “No act of terror will dim the light of the values that we proudly shine on the rest of the world, and no act of violence will shake the resolve of the United States of America.”

G’night, god bless. The Daily Mauler does its best:

You could say that Obama was calling this attack an “act of terror.” Or you could say that Obama was using the phrase “act of terror” in the vicinity of discussing the “attack” to come close to labeling it an act of terror without actually, logically doing so, preserving his freedom to not do so in the future. He only used the phrase after talking about the original 2001 9/11 attacks, after all. Maybe those were the “acts of terror” that wouldn’t shake our resolve, etc. that Obama was talking about.

No. Not close. Let’s put the nonsense to rest. This was also Obama on the 13th, in Colorado. His message was crystal clear:

“So what I want all of you to know is that we are going to bring those who killed our fellow Americans to justice. I want people around the world to hear me: To all those who would do us harm, no act of terror will go unpunished. It will not dim the light of the values that we proudly present to the rest of the world. No act of violence shakes the resolve of the United States of America,” he said.

On September 12th and 13th, the President called the attack in Benghazi “acts of terror” three different times. So enough.

I am so sick of reading this revisionist crap.

Drop the Racial Rhetoric
Obama should blow his own dog whistle and tell his partisans to desist.
By Deroy Murdock | National Review

Congressman-for-Life Charles Rangel blah blah . .

Oh I’m sure the President has got a dog whistle of his own he can blow. Ugh. And everyone will know it’s time to stop the bigoted anti-racial farce or something. Anyway, here comes the lying again.

Biden’s comments were just a bizarre and crude effort to scare black people into voting Democrat, again. . .

While one may disagree with Romney, his running mate Paul Ryan, and every Republican on Capitol Hill, the notion that the GOP is itching to re-enslave blacks is an outrageous, disgusting lie that utterly mutilates American history. As most students learn in junior high school, abolitionists launched the Republican party to end slavery. Republicans defeated the Confederacy and then spent Reconstruction trying to incorporate blacks into American society. Democrats fought them at every turn.

After the War of Northern Aggression, after the waves of cursed reconstructionists and carpetbaggers receded, the Republican Party was unwelcome in the South. All politics was conducted through the Democratic Party. It was both conservative and liberal, left and right (but mostly waaay right). During the debate over the Civil Rights Act of 1964, 21 of the 22 senators that represented the South were Democrats. 87 of 94 Southern members of the House were Dems.

Saying your party wasn’t guilty of Southern racism while your party was exiled from the possibility is no argument at all. Murdock plays games with words like “Democrat.” The Southern Republican may have barely existed but the familiar reactionary conservatism was certainly there. To this point, look at the differences between voting patterns North and South regarding that historic act:

On the Senate version, the Northern Democrats voted 45 -1 for it and the Southern Democrats voted 20 -1 against it. It didn’t particularly matter what party you said you belonged to, once you got below the Mason-Dixon line you were a right winger. And do you remember the powerful voting bloc the Southern politicians composed at the time?

In the United States, the conservative coalition was an unofficial Congressional coalition bringing together the conservative majority of the Republican Party and the conservative, mostly Southern, wing of the Democratic Party. It was dominant in Congress from 1937 to 1963 and remained a political force until the mid 1980s, eventually dying out in the 1990s.

These were America’s most conservative politicians: Southern Democrats. To say they were or are linked to liberal or progressive politics in any way is to lie. These were the racist white supremacists, like Strom Thurmond, that the GOP received with open arms after the successes of the civil rights movement.

And the “Southern Manifesto,” remember that?

The Declaration of Constitutional Principles (known informally as the Southern Manifesto) was a document written in February and March 1956, in the United States Congress, in opposition to racial integration of public places. The manifesto was signed by 99 politicians (97 Democrats) from Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, Texas, and Virginia. The Congressmen drafted the document to counter the landmark Supreme Court 1954 ruling Brown v. Board of Education, which determined that segregation of public schools was unconstitutional.

How’s that for Originalist States’ Rights Tea Party activism?

The Southern Manifesto accused the Supreme Court of “clear abuse of judicial power.” It promised to use “all lawful means to bring about a reversal of this decision which is contrary to the Constitution and to prevent the use of force in its implementation.” The Manifesto suggested that the Tenth Amendment to the United States Constitution should limit the reach of the Supreme Court on such issues.

Tenthers. You get my point. Back to hooray! Deroy:

President Ronald Reagan named General Colin Powell to be America’s first black national security adviser and authorized the Dr. Martin Luther King Jr. national holiday.

My butt. Presidents authorize no such thing. They either sign or veto the legislation, and Reagan wanted to veto it.

Reagan staunchly opposed the King Holiday bill. And he did not oppose it as later historical revisionists claim solely for cost reasons, that is that the federal government couldn’t afford to give federal employees another day off. This is the politically palatable cover.

At a press conference October 19 two weeks before he grudgingly signed the bill he quipped that he’d sign it only “since Congress seemed bent on making it a national holiday.” It took every ounce of the congressional bent that Reagan ridiculed to get him to put his signature on the bill. Congress passed the bill with an overwhelming veto-proof majority (338 to 90 in the House of Representatives and 78 to 22 in the Senate).

And don’t forget:

Reagan revealed even more of his true thinking about King in a letter to ultra-conservative former New Hampshire governor Meldrim Thompson. He unapologetically told Thompson that the public’s view of King was “based on image, not reality.” Reagan was roundly criticized for besmirching King, and he subsequently publicly apologized to King’s widow, Coretta Scott King. In assailing King, Reagan simply followed the well-worn ultra-conservative and racist script that King was a radical, racial agitator, and a closet communist.

Got it, Deroy? Reagan had to apologize to Mrs. King for being a stupid ass. For being your typical commie-baiter of the conservative Republican sort that is still found flogging his race jitters today. All of a dozen days ago Rep. Todd Akin said he was open to repealing both the Civil Rights Act of 1964 and the Voting Rights Act of 1965. So enough of your garbage, Murdock.

ADD . . This is good:

Mr. Reagan’s letter replied to one he received from former New Hampshire Gov. Meldrim Thomson, who asked the President to veto the bill. In the letter, Mr. Thomson called Dr. King “a man of immoral character whose frequent association with leading agents of communism is well established.”

Mr. Reagan replied, “I have the same reservations you have, but here the perception of too many people is based on image, not reality.”

Mr. Reagan telephoned Mrs. King before leaving for a weekend of golf at the Augusta National Golf Club in Georgia, which has no black members.

Yes, your precious Ronnie really cared about the likes of you Deroy.

Name this inmate of Thorazine Meadows. See if you can guess:

President Obama’s victory lap and shameless, media-assisted political exploitation of the Navy SEALs’ triumph continued with the program opening with the photograph taken in the White House Situation Room, now apparently open to public tours.

Administration bigwigs were shown watching the fruits of President George W. Bush’s labors as Navy SEALs, acting on a trail of evidence gathered using enhanced interrogation techniques President Obama opposed, took out Osama bin Laden.

Navy SEALs doing the heavy lifting? Check. Obama playing politics? Check. Applause for torture? Check. George W. Bush for the win? Check.

The president was shown sitting in the corner dressed in casual clothes, as he had rushed there after playing nine holes of golf at Andrews Air Force Base before heading to the Situation Room at around 2 p.m.

“The picture,” said [Brian] Williams dramatically, “was actually years in the making. When he was president, Bill Clinton spent 75 cruise missiles trying to kill bin Laden.”

And missed 75 times, including those launched during the Monica Lewinsky affair and his impeachment. Close, but no cigar.

Angry monkey. Lazy golfing Prez? Check. Clinton incompetent? Check. Monica Lewinsky cameo? Check plus, well done. Stinky cigar? Double check and a pony. Calisthenic high velocity poo-flinging.

Who’s that under the Cheezy Poofs revitalizing mask? None other than Investor’s Business Daily, the “leading financial news and research organization recognized for proprietary stock screens, comparative performance ratings and a record of identifying stock leaders.” This is arbitrage moonspeak, or what the M&A weasels call “an editorial.”

What do picking stocks and leveraging debt have to do with last year’s Abbottabad strike? “[W]e left Somalia in disgrace after dead Americans were dragged through the streets, giving Osama all the encouragement and proof of our lack of will he needed.” Nice try, pork belly.

Bin Laden Derangement Syndrome. It knows no bounds. The angry tears and toy-hucking have barely begun. Why? Because the negro hopey-changey offing their sacred Muslim sandgook IS KILLING THEM. Seriously, some of these ladies will have infarcts.

Let’s see: selling the Romney. What to do, what to do. Hmm.

Well, the man is oatmeal. How do you sell that? Where’s the sizzle in warm goo? “Add a little brown sugar, and he goes down plenty easy.” Geez. “Mitt Romney: Babies can’t tell the difference.” Hey, I like that one. Because it’s true.

Maybe I can turn this thing around. Maybe I could play upon his weaknesses. Rally the voters to his side. “It’s Romney time.” Yecch, no. “Don’t you quit on the man named Mitt.” Better. “This man needs you now.” Way too honest.

What am I selling, by the way? What the hell is this guy, incidentally? Let’s try it from that angle. What is he, really? Wonder Bread. Yep. “He never grows stale.” Too foodie. “Pliable as Silly Putty, but less toxic.” I’m not even sure that’s true. “The older he gets, the better he goes with clam chowder.” Good, but psychedelic.

What else? He’s functional. Hmm, yes. “As long as he’s got batteries, he keeps moving.” We’re getting somewhere. “Mitt: Point and Click.” Hot damn, that’s not bad. Though a bit cold. “Don’t lick your fingers and put them in his sockets.” Hell, that’s true of anybody. Well, not everybody. That Pattie Heaton, hoo-boy. But this goes to that ‘He’s a robot’ thing. Not sure that’s so bad, considering. Compared to Rick Santorum, a robot could be your mother.

Alright, what else is Mitt? A boss. Yeah, we could spin that. Let’s call him a ‘worker.’ This man works hard. Bain Capital ‘hired’ the hard-working Mitt. Mmm, good. “You want Mitt in your cubcle.” That’s it. “Romney for the job of America.” That’s some money. “It’s time to employ Mitt Romney.” There’s your winner. It’s go time.

‘Hire Me’
Romney should remind us no one has ever regretted hiring him to do a job.
By Rich Lowry | National Review

. . His pitch for himself should be that he’ll be an equally workmanlike president. Although it hasn’t set the GOP on fire, his truest, most natural message is that he’s a turnaround artist — the guy who can rationally evaluate a situation, come up with a plan and execute it.

Beautiful. Just gorgeous.

His case has to include a vision of a better America. But his implicit slogan should be “No one ever regretted hiring Mitt Romney to do a job.”

Bingo. Aaaanndd . . *publish.* Whew. Note to self: You’re the man. Aw, it was nothing.

Though I wonder if it’s true. If people were glad they voted for Mitt Romney. What was he polling at the end of his term in Massachusetts? The data must be online somewhere.

Ah, here:

Christ, that’s funny.


ADD: Mary “cuddles” Matalin walks in the side door at ABC studios, punches the clock:

“He has the heart and soul — and his family does — of an average American family.”

You buying that? Meanwhile, the Atlantic’s Molly Ball looks at the candidate and says:

“For all the hype about his woodenness, Romney, I submit, actually has the most sophisticated — and underappreciated — sense of humor of any presidential candidate. It is dry, self-deprecating and a bit dark, a far cry from the safely hokey laugh lines of most politicians on the stump.”

We send our best wishes and healing thoughts over to Molly Ball, her friends and family at this difficult time.

Campaigning politicians do plenty of shitty things to the world, but maybe the worst they do is make a case why they should be in charge of the likes of you.

It’s not an easy thing to do, frankly. A politician is trying to get a likely sensible person to do something stupid: give up their power to an inferior clod. Luckily, there are plenty of tricks to play upon the electorate.

George Washington used to get the hoi polloi drunk. It worked. Andrew Johnson, taking over for Abraham Lincoln after his assassination, told the Democrats in 1868 that he was the agent to intervene in the rise of Southern black political power. Oddly, his bid failed. George W. Bush’s brother Jeb constructed local Florida ballots so byzantine, they’d have hypnotized M.C. Escher at 30 feet. That was a winner.

Rick Santorum has his methods. He’d like to appeal to the voters by raising their self-esteem. This he’ll do by pretending The Great Horned One is obsessed with them. How can they resist?

If you were Satan, who would you attack in this day and age? There is no one else to go after other than the United States, and that’s been the case for now almost 200 years, once America’s preeminence was sown by our great Founding Fathers.

Once America institutionalized slavery through its constitutional process, the Devil looked at America and said, “Never before has a nation so compassionate, well-meaning and humane been constructed. I can’t have these saints hanging around, it’s time to wipe them out. (Hey, is this place a mess, what with all the shackled children and dead bodies laying around, or what?)” Satan has been nipping at America’s heels ever since. Occasionally, he snags one of us:

He was successful. The place where he was, in my mind, the most successful and first successful was in academia. He understood pride of “smart” people. He attacked them at their weakest, that they were in fact smarter than everybody else and could come up with something new and different, pursue new truths, deny the existence of truth, play with it, “because we’re smart;” and so academia a long time ago fell.

The first idiots to figure out that slavery was evil, the folks who did “pursue new truth,” were also the first to fall. Are you getting this, voters? America has always been perfect. You’ve always been gooder than a professor. Supernatural forces have always plotted against you, from even before you were born. I’m here to tell you, it’s all true. Thirsty, by any chance? In the back, by the folding tables, we’ve got mead by the barrel.

Allen West, the Florida Tea Party representative from a very Jewish district, offered us an opinion yesterday. When asked about Americans having a negative view of Congress, Allen said it was unfair. The reason people thought Republicans were douchebag politicians, he said, wasn’t because it was true. It was because Democrats were master media manipulators, like those of the Nazi Party. Liberals are modern-day Reich Ministers of Propaganda:

Tea party favorite Rep. Allen West (R-Fla.) said Thursday that Nazi propagandist Joseph Goebbels would be “very proud” of Democrats for shifting public sentiment against Republicans, and he blamed the press for helping spread their message.

“If Joseph Goebbels was around, he’d be very proud of the Democrat Party because they have an incredible propaganda machine,” West told reporters in the Capitol. “I think that you have, and let’s be honest, you know, some of the people in the media are complicit in this, in enabling them to get that type of message out.”

Are we Joseph Goebbels? I don’t think so. Goebbels was a homicidal lunatic, a man directly responsible for the deaths of countless Jews. We like our Jewish friends. They’re more likely to be Democrats than Republicans, and I’m happy to assume there’s a good reason for that.

So this sounds like an opinion offered for effect, doesn’t it? There’s a word for that, though it escapes me now. Anyway, more Democrats:

. . Goebbels told Hitler that “spontaneous” anti-Jewish violence had already broken out in German cities, although in fact this was not true: this was a clear case of Goebbels manipulating Hitler for his own ends . . He wrote in his diary:

“[Hitler] decides: demonstrations should be allowed to continue. The police should be withdrawn. For once the Jews should get the feel of popular anger … I immediately gave the necessary instructions to the police and the Party. Then I briefly spoke in that vein to the Party leadership. Stormy applause. All are instantly at the phones. Now people will act.”

The result of Goebbels’ incitement was Kristallnacht, the “Night of Broken Glass,” during which the S.A. and Nazi Party went on a rampage of anti-Jewish violence and destruction, killing at least 90 and maybe as many as 200 people, destroying over a thousand synagogues and hundreds of Jewish businesses and homes, and dragging some 30,000 Jews off to concentration camps . .

Are we the types of people to incite an anti-wingnut Kristallnacht in America? Would we murder or imprison thousands of Republicans? I doubt it. And though we hate the teabagger, the same way Goebbels despised Berlin Police President Bernhard Weiss, would we orchestrate a propaganda effort like this?

Gosh, maybe we would. That’s awfully funny.


JUST IN: You can’t make this comedy up . .

Media Matters brings word that furious right-wing truth teller, Andrew Breitbart — who believes Allen West should run for President — has been using classic Nazi imagery to attack the Democrat-controlled media:

In at least three instances, Andrew Breitbart’s Big Journalism website has used an image connected to a Nazi-era German magazine noted for anti-Semitic cartoons and pro-Hitler leanings.

The image appeared in a Big Journalism post Thursday morning written by Logan Churchwell, director of public relations at Accuracy in Media:

Here’s their pic of the post:

. . and here’s the original image, from a 1942 copy of Nazi propaganda fount Kladderadatsch:

No harm in using a time-tested image to attack the dirty propagandists, right? Okay, Allen, there’s your cue: “If Joseph Goebbels was around, he’d be very proud.” But you guys might want to shorten the hook nose and erase the Star of David before posting it. Oh, I see. Gut gemacht.

In part one, I detailed how, amongst businessmen like Michael Bloomberg and Conservatives universally, the misguided swore the stupid government forced lenders to loan to undeserving poor folks and minorities, causing the housing bubble and the subprime crisis. This liberal ‘social crusade’ was to blame for the collapse of the economy.

In part two, I demonstrated how perfectly wrong that was. The U.S. data on all loans originating in 2006, at the height of the subprime loan frenzy, showed that those banks most highly regulated and government-constrained to make loans to lower income and minority borrowers, the Community Reinvestment Act (CRA) banks, were far less likely to offer risky, ‘high-cost’ subprime loans. It was the government-independent institutions that generated the vast majority of subprimes. And, when they did, the brokers manufactured loans at higher APRs across the economic strata.

Federal Reserve Governor Randall S. Kroszner summed it up nicely:

Our analysis of the loan data found that about 60 percent of higher-priced loan originations went to middle- or higher-income borrowers or neighborhoods. Such borrowers are not the populations targeted by the CRA. In addition, more than 20 percent of the higher-priced loans were extended to lower-income borrowers or borrowers in lower-income areas by independent nonbank institutions–that is, institutions not covered by the CRA.

Putting together these facts provides a striking result: Only 6 percent of all the higher-priced loans were extended by CRA-covered lenders to lower-income borrowers or neighborhoods in their CRA assessment areas, the local geographies that are the primary focus for CRA evaluation purposes.

There it is. Only 6 percent of subprimes went to poor people. The crisis wasn’t because of the darkies. And it wasn’t because of the government.

So, the question becomes: Why were fatal, risky loans being made? Why did so many lenders do something so dumb? Why didn’t anyone flag the dangers? Bitterly, we know now it was the high-risk, high-cost loans that couldn’t be re-paid. When the loans died, the houses died, the banks died, the financial institutions and markets died, and the great recession was on.

So, who would be prompted to make loans that default? If you’re only going to be a stupid lender, you’re only going to get hurt, right? You would think. But thanks to Bush administration-era ‘business innovation,’ the answer was “No.”

For the first time in the history of lending, you could make all sorts of stupid loans and escape the consequences. You didn’t have to worry about whether a penny got paid back from the borrower to the bank. How? Why? Because lenders were the last people on Earth responsible for their own lending. Within days of making the loans — bon voyage — they sold them allthem.

Home loans were boxed up and sold to giant secondary financial players. Those guys cut them to pieces and cabbaged them into “risk averse” bundles (mortgage-backed securities [MBSs] and collateralized debt obligations [CDOs]), and the bundles were then sold again, this time to ordinary American investors. They told Ma and Pa America that cutting and bundling made a losing investment impossible. ‘Trust us, people, there’s no harm in sight’ they said, and they put their ‘good’ name on it. Goodnight, thanks for shopping with Goldman Sachs. And, honestly, before everyone got hip to the game, they would have been right.

The problem began in the early 2000s when business types everywhere got smart. The government-independent players were running away with the industry. The Government Sponsored Entity (GSE) giants, Fannie Mae and Freddie Mac, whose job it is to buy home loans and then sell them elsewhere in order to keep the loan market moving, went cold. Mortgages by the thousands were being bought up, bundled and sold by outsiders:

Then in 2003-2004, the subprime mortgage crisis began. The market shifted away from regulated GSEs and radically toward Mortgage Backed Securities (MBS) issued by unregulated private-label securitization conduits, typically operated by investment banks.

Government-independent secondary market operators were making a killing buying up days-old loans, stewing them and selling them to investors across the world. The investors had such faith in the financial giants of the world that they didn’t ask why the loans wouldn’t tank.

So the market for loans, any loans, green-gilled loans, walking on club-feet and mumbering loans, went white hot. Lenders were handsomely rewarded for anything they managed, including mortgage dogshit. Especially dogshit.

Lending became an open-ended game of paperwork and profit: it didn’t matter how you got someone to agree to a loan, you simply had to get them to do it. An explosion of stupid, crazy-ass fire sale and discount loans got plastered across America’s retail windows.

The mortgage qualification guidelines began to change. At first, the stated income, verified assets (SIVA) loans came out [got removed from the high-standards loan pool]. Proof of income was no longer needed. Borrowers just needed to “state” it and show that they had money in the bank. Then, the no income, verified assets (NIVA) loans came out. The lender no longer required proof of employment. Borrowers just needed to show proof of money in their bank accounts. The qualification guidelines kept getting looser in order to produce more mortgages and more securities. This led to the creation of NINA. NINA is an abbreviation of No Income No Assets (sometimes referred to as Ninja loans). Basically, NINA loans are official loan products and let you borrow money without having to prove or even state any owned assets. All that was required for a mortgage was a credit score.

Another example is the interest-only adjustable-rate mortgage (ARM), which allows the homeowner to pay just the interest (not principal) during an initial period. Still another is a “payment option” loan, in which the homeowner can pay a variable amount, but any interest not paid is added to the principal. Nearly one in 10 mortgage borrowers in 2005 and 2006 took out these “option ARM” loans, which meant they could choose to make payments so low that their mortgage balances rose every month. An estimated one-third of ARMs originated between 2004 and 2006 had “teaser” rates below 4%, which then increased significantly after some initial period, as much as doubling the monthly payment.

All of these bargain-fumbling fancies were designed to do one thing: get someone to bite on the front end of a deal destined to crash at the back. Regardless of the menial APRs at the beginning of the mortgage, these were big, high-cost deals. These were horrible to live with, even for the financially healthiest Americans.

But, my gosh, didn’t the sales pitch work:

The ratio of lower-quality subprime mortgages originated rose from the historical 8% or lower range to approximately 20% from 2004-2006, with much higher ratios in some parts of the U.S. A high percentage of these subprime mortgages, over 90% in 2006 for example, were adjustable-rate mortgages.

One-fifth of mortgages became “You’re out of your mind, you can’t possibly pay this back” gambles. All because the loans weren’t really loans — they were investments to be sold to suckers to be re-sold to other suckers.

Of course, a multi-trillion dollar system gone ravenous for toxic debt is suicidal. Such irresponsibility can’t survive. A violent crash was inevitable.

In the third quarter of 2007, subprime ARMs making up only 6.8% of USA mortgages outstanding also accounted for 43% of the foreclosures which began during that quarter.

The foreclosures, sadly, had only begun. You can fill in the rest of the story, you know what happened after that.

Recap, part one:

These colored people, they have no money. They have no assets, they have no credit history, they have crappy jobs. Hell they barely know what a loan is, and we don’t speak Spanish. Nevertheless, in 1994, the Clinton administration demand we, the hallowed bankers, start giving them loans . .

“It took a little more than a decade for the negative effects of the assault on prudent lending to be felt. By 2006, the shaky subprime mortgages began to default. In 2008, the bubble exploded.”

We’ve been faced with this lie before, and it still comes dressed up so many ways. The right-popular version of this charge is that the liberals’ big government Community Reinvestment Act (CRA) is mostly to blame.

Cause and Effect — Government Policies and the Financial Crisis
By Peter J. Wallison | American Enterprise Institute | November 2008

The current financial crisis is not–as some have said–a crisis of capitalism. It is in fact the opposite, a shattering demonstration that ill-considered government intervention in the private economy can have devastating consequences. The crisis has its roots in the U.S. government’s efforts to increase homeownership, especially among minority and other underserved or low-income groups . .

The two key examples of this policy are the CRA, adopted in 1977, and the affordable housing “mission” of the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. As detailed below, beginning in the late 1980s–but particularly during the Clinton administration–the CRA was used to pressure banks into making loans they would not otherwise have made and to adopt looser lending standards that would make mortgage loans possible for individuals who could not meet the down payment and other standards that had previously been applied routinely by banks and other housing lenders.

Previously, banks operating in poorer neighborhoods took depositors’ moneys but refused to loan it back to them in the form of car or home loans. The CRA demanded that institutions taking deposits from people in low and middle income areas loan the money back to their own depositors. As a result, the government has tightly regulated the “CRA banks” ever since, monitoring very closely their lending habits for color-blindness.

Conservatives swear it was the government’s CRA that murdered the economic planet. When you loan money to the browns and blacks, they warn, they’re going to screw up the loan. You’re not gonna get your money back. And when you force enough lenders to do this, a catastrophe is inevitable. Didn’t we just have a disaster? Need we say more, hmm?

But this is a lie, one debunked over and over again. It’s bull, and I can prove it. Of all the data and documents I’ve culled to understand the mortgage crisis and the implosion of the economy, there’s one I recently came upon that defeats this canard most thoroughly in examining the subprime mortgage frenzy.

Titled “The Community Reinvestment Act: A Welcome Anomaly in the Foreclosure Crisis,” it’s a bit of simple well-written research produced by a 3rd Avenue New York law firm, Traiger and Hinckley, specializing in “fair lending” counsel.

They crunched the data on all U.S. home loans from 2006 — the height of the subprime frenzy — in our 15 biggest cities. The analysis proves the opposite of what the right-wing and business harpies allege: the CRA, its banks, and its targeted beneficiaries, low and moderate income minorities, had almost nothing to do with the subprime crisis.

Our study concludes that CRA Banks were substantially less likely than other lenders to make the kinds of risky home purchase loans that helped fuel the foreclosure crisis. Specifically, our analysis shows that:

(1) CRA Banks were significantly less likely than other lenders to make a high cost loan;
(2) The average APR on high cost loans originated by CRA Banks was appreciably lower than the average APR on high cost loans originated by other lenders;
(3) CRA Banks were more than twice as likely as other lenders to retain originated loans in their portfolio; and
(4) Foreclosure rates were lower in MSAs with greater concentrations of bank branches.

Let’s look at who made loans back in 2006. Let’s particularly look at subprime loans. Subprimes are loans charged higher percentage rates because borrowers are higher risks, for any number of reasons: they have low-paying jobs, few assets, shaky credit histories, etc. These 2006 borrowers often got subprime, or “high-cost,” loans.

Look at the difference between the lending in 2006 by low and middle-income serving “CRA banks” and all other lenders for all loans. Then compare the same institutions lending subprimes:

All other institutions outpaced CRA bank lending for ‘all loans’ at around a 3.5:1 (77.2%/22.8%) pace. You would expect to see this because other lenders outnumber CRA banks, so that’s fine. But when you look at subprimes, the lending ratio suddenly jumps to 10:1. This is the opposite of what Bloomberg, Sperry, Wallison and other business types had claimed. Terrified as they were of government bullying, lenders were supposed to be rushing headlong towards borrowers with risky mortgages. No. Instead, it was the CRA-independent lenders, like Countrywide, that were doing it. The banks living among the poor folks were far less likely to issue subprime mortgages.

When you narrow the focus of the data even more upon Lower and Middle Income (LMI) borrowers, you still get the same contrast:

In loaning to lower and middle income borrowers, the CRA regulated lenders were far less likely to issue high-cost subprime loans. The data show they were generating far fewer subprime loans at the height of the crisis. The facts destroy the charge that minority lending caused our economic collapse. CRA banks, forced by big brother, were offering affordable mortgages to minorities. Period. Independent institutions, government-free, were pushing high-cost, high-risk loans on everyone.

When you look at what the lenders were charging, you see even more of the same. In a graph titled “Average Rate Spreads on High Cost Loans Originated by CRA Banks and Other Lenders,” the Traiger and Hinckley data show that independent lenders charged higher rates for their subprime loans:

Taken together, the 2006 U.S. loan data analyses demonstrate that the government-independent institutions were pushing far more subprime loans, pushing them upon far more people, rich and poor alike, and charging higher interest rates for them.

Much as our conservative and business bloviators would like, while being entitled to their own opinions, they are not entitled to their own nationwide loan data set from 2006. The facts dismantle any pretense that lending to minorities caused the mortgage crisis and, thus, our collective misery.

Tomorrow, in part 3, the finish. Ciao.

Here. We. Go. Again.

The love that dares to speak its name, that of bankers for ass-screwing poor people, raises its voice once more. Funny how these business tough guys love to attack the defenseless. And this time it’s not greed or opportunity or conventions or shame or the understandable attempt to duck penitentiary time that inflamed its habitual desires. Of all the motivators, this time, it is Occupy Wall Street.

Congratulations you street-bound shivering types, you have driven the banksters crazy. They’re unhinged enough by the specter of protests reflecting poorly upon them to revive one of their historically stupid lies. And this is it: When the government forced us to lend to minorities, it caused the economy to collapse.

We didn’t want to do it — the government made us. These colored people, they have no money. They have no assets, they have no credit history, they have crappy jobs. Hell they barely know what a loan is, and we don’t speak Spanish. This is the three-legged banker bullshit come ’round for its latest jog.

All over the internets today, it was again the poor folks’ fault:

Bloomberg: ‘Plain and Simple,’ Congress Caused the Mortgage Crisis, Not the Banks
By Azi Paybarah 11:03 am Nov. 1, 2011

. . Bloomberg was asked what he thought of the Occupy Wall Street protesters.

“I hear your complaints,” Bloomberg said. “Some of them are totally unfounded. It was not the banks that created the mortgage crisis. It was, plain and simple, Congress who forced everybody to go and give mortgages to people who were on the cusp . .

“But they were the ones who pushed Fannie and Freddie to make a bunch of loans that were imprudent, if you will. They were the ones that pushed the banks to loan to everybody. And now we want to go vilify the banks because it’s one target, it’s easy to blame them and congress certainly isn’t going to blame themselves. At the same time, Congress is trying to pressure banks to loosen their lending standards to make more loans. This is exactly the same speech they criticized them for.”

He’s a billionaire, he must be right. Except Fannie and Freddie don’t make loans, they buy them. And they were initially left out in the subprime cold, away from the growing market frenzy because they hated buying into the obvious risk. And here’s where perhaps the second great subprime crisis mystery (the first being ‘how could this happen?’) pops up: How can businessmen be so stupid? Bloomberg should know a lot more about Government Sponsored Entities (GSEs) than your average foul-mouthed blogging molecular biologist/musician. But here he is saying to a bunch of nodding business types that the government pushed Fannie and Freddie “to make a bunch of loans that were imprudent, if you will.”

Dear Mayor Mammon: you are wrong. You’re not the only one, here comes the Investor’s Business Daily:

Smoking-Gun Document Ties Policy To Housing Crisis
By PAUL SPERRY, FOR INVESTOR’S BUSINESS DAILY Posted 10/31/2011 08:05 AM ET

President Obama says the Occupy Wall Street protests show a “broad-based frustration” among Americans with the financial sector, which continues to kick against regulatory reforms three years after the financial crisis.

“You’re seeing some of the same folks who acted irresponsibly trying to fight efforts to crack down on the abusive practices that got us into this in the first place,” he complained earlier this month.

But what if government encouraged, even invented, those “abusive practices”?

Rewind to 1994. That year, the federal government declared war on an enemy — the racist lender — who officials claimed was to blame for differences in homeownership rate, and launched what would prove the costliest social crusade in U.S. history.

Well, there’s a simple enough claim. The government started going after racist lending practices in 1994 and ended up destroying the world economy in 2008. What data does Paul Sperry offer for this shocking criminal claim? None, never mind. Please only pay attention to who Sperry claims ended up with the smoking guns:

–10 federal agencies issued a chilling ultimatum to banks and mortgage lenders to ease credit for lower-income minorities.

–The unusual full-court press was predicated on a Boston Fed study showing mortgage lenders rejecting blacks and Hispanics in greater proportion than whites.

–For the first time, Washington’s bank regulators put racial lending at the top of their checklist.

–”Applying different lending standards to applicants who are members of a protected class is permissible,” it said.

–To that end, lenders were directed to “make changes in marketing strategy or loan products to better serve minority segments of the market.”

–They were also advised to “change commission structures” to encourage brokers and loan officers to “lend in minority and low-income neighborhoods” — a practice Countrywide Financial, the poster boy of the subprime scandal, perfected.

–FDIC warned banks that even unintentional discrimination was against the law, and that they should be proactive in making “multicultural” loans.

–It warned lenders who rejected minority applicants with high debt ratios and low credit scores to “be prepared” to prove to federal regulators and prosecutors they weren’t racist.

You see what the stupid government was doing. If not, Sperry shocks you back to reality with time-worn business truths about minorities:

–The author of the 1992 study, hired by the Clinton White House, claimed it was racial “discrimination.” But it was simply good underwriting.

–In addition to finding embarrassing mistakes in the data, they concluded that more relevant measures of a borrower’s credit history — such as past delinquencies and whether the borrower met lenders credit standards — explained the gap in lending between whites and blacks, who on average had poorer credit and higher defaults.

–The study did not take into account a host of other relevant data factoring into denials, including applicants’ net worth, debt burden and employment record . . [etc.] . . When these missing data were factored in, it became clear that the rejection rates were based on legitimate business decisions, not racism.

Mix a stupid social crusade with hard market realities and . .

It took a little more than a decade for the negative effects of the assault on prudent lending to be felt. By 2006, the shaky subprime mortgages began to default. In 2008, the bubble exploded.

. . it’s just as simple as that. The economy exploded, and now you can’t get a job.

Except the whole thing is a lie. Tomorrow, in part two, the debunk begins.

See part Two. Part Three.

Rupert Murdoch obviously hates Occupy Wall Street. Otherwise, why would his Wall Street Journal be working overtime to trash the movement?

The examples pile up. For instance, a week ago, Murdoch op-ed columnist James Taranto whined about a protester he saw on This Week with Christiane Amanpour. This guy, he’s a propagandist, a fake, a liar, a loser, Taranto wrote. By far, Taranto proved more pathetic: calling Peggy Noonan authentic working class, mocking protests past and present and laying the responsibility for Occupy at the feet of . . Rupert Murdoch. Nice try, James, but few people are that stupid.

Today, the Journal are at it again. And they’re trying to use the same strategy as they did last week: painting the protesters as extremist and inauthentic. Fortunately, their new hitman man was no more up to the task than Taranto was. They employed Fox News contributor and thoroughly disgraced ‘Democratic’ pollster Douglas Schoen for the work:

That’ll get to me crack up pretty quickly. If ever there were a fix in on a survey, it’d be one where Murdoch asked Schoen to poll the folks at Occupy.

Doug, you may remember, was employed by the WaPo wingnuts last fall to pen a sober op-ed on Barack Obama. What was the heroic, humble ‘Democrat’ asking of his Commander in Chief? Only that he quit his job, nothing more. That way, Schoen opined, Barack Obama would be the greatest president ever.

If Doug’s logic escapes you, that’s because it escaped him long before you approached. He beat it out of his heart to make way for cash. Schoen’s profession is playing an angle to a moneyed, Conservative constituency: you wanna know about liberals and Democrats? I’m one of them. I’ll tell you about them, and you’ll love the results.

So here it is:

Polling the Occupy Wall Street Crowd
In interviews, protesters show that they are leftists out of step with most American voters. Yet Democrats are embracing them anyway.

President Obama and the Democratic leadership are making a critical error in embracing the Occupy Wall Street movement—and it may cost them the 2012 election . .

Already, you can sense his concern. You can bet that Rupert’s worried about the Democrats’ chances in 2012, too.

The protesters have a distinct ideology and are bound by a deep commitment to radical left-wing policies. On Oct. 10 and 11, Arielle Alter Confino, a senior researcher at my polling firm, interviewed nearly 200 protesters in New York’s Zuccotti Park. Our findings probably represent the first systematic random sample of Occupy Wall Street opinion.

With Schoen, we know the fix is in. So we’re wary from the beginning. When you poll a group of entrenched protesters, what do you really expect? When people are so angry that they’ve stopped sleeping at home and are now living in a park, what will their answers about issues tell you?

C’mon Doug — they’re pissed. To figure that, you don’t need polls. And thank god for the rage. If it weren’t for angry people, what good would ever come of democratic politics? The whole Murdoch idea behind the poll — Do you trust these people? Aren’t they different from you? — is a joke.

Rupert, buddy, we’re not asking these people to run the country. We’re asking them to change things. What a big difference that makes. All the difference. Just think of what Schoen’s useless polling of the Egyptian rebels would have told you: these people are dangerously out of step with the nation’s centrist values, like tolerance and non-violence. The WSJ would then have you believe that expelling Mubarak would be wrong. That would be wrong. But seeing as how you one-percenters paid Doug so handsomely for such a pretty poll, by all means, go on.

Our research shows clearly that the movement doesn’t represent unemployed America and is not ideologically diverse. Rather, it comprises an unrepresentative segment of the electorate that believes in radical redistribution of wealth, civil disobedience and, in some instances, violence. Half (52%) have participated in a political movement before, virtually all (98%) say they would support civil disobedience to achieve their goals, and nearly one-third (31%) would support violence to advance their agenda.

See? It’s laughable. While the Journal thinks it’s doing a great job of smashing your fear buttons — politics! violence! — it’s gotten me plenty encouraged. I’m sure I’m not the only one. I want these people to be civilly facile. I want them to be politically experienced. I’ll even take a few who have considered violence. A mix of those types can make for a pretty effective movement. They’ll certainly be willing to get things done.

And we want things done. Occupy Wall Street have proven they’re not trivial, and they’re dedicated to change. I’m glad that they’re there, and I enthusiastically hail their efforts. As for Schoen’s whatever, appointed with its numbers and percentages . .

What binds a large majority of the protesters together—regardless of age, socioeconomic status or education—is a deep commitment to left-wing policies: opposition to free-market capitalism and support for radical redistribution of wealth, intense regulation of the private sector . .

. . it’s meaningless.

Except for this: it was meant to scare Wall Street Journal readers. Good.

Powerful folks push back. That’s what they do, always, and today’s no different. The moneyed, well-heeled and well-connected mount larger and larger attacks against Occupy Wall Street because the movement is spreading.

In “Capitalist Tool,” Wall Street Journal columnist James Taranto takes his stab at discrediting the stupid hippies. Well, just one hippie: DKos blogger and protestor Jesse LaGreca, who appeared as a somewhat-representative of Occupy on “This Week With Christiane Amanpour.” Familiar themes abound throughout Taranto’s bleating.

1.) Jesse’s a liar.

Whether or not LaGreca is working-class at all, his assertion that that gives him singular status on Sunday news shows is plainly bunk. He appeared along with a panel consisting of Donna Brazile, Matthew Dowd, Peggy Noonan and George Will. (In case you missed it, ABCNews.com has the video.) Noonan, with whom we work, tells us that she and two of the other three panelists had what would be considered working-class upbringings. (The exception is Will, son of an epistemologist.)

I could have paid Taranto to be so Wall-Street-Journal oblivious. Or maybe so East-Coast-what’s-your-family-name fatuous. James: Brazile, Dowd, and Noonan haven’t been working class for a long, long time. Maybe decades. They haven’t felt the crushing weight of the collapse of our economic infrastructure. They don’t really know anything about it.

Yes, that very much matters. People in pain do complain, it shouldn’t surprise you. Credit a Wall Street/Manhattan “Tool” to assume the Reagan-fondler, the comically comfortable Dolphins! Noonan, is a coal worker at heart because her dad wasn’t a Rockefeller. Why hasn’t Peggy thrown away her shovel and joined the riots? The fact that LaGreca bothers to go out there day after day tells you plenty, or it should.

2.) Jesse is lazy.

LaGreca’s response: “. . I’m not going to tell you who to vote for. But I will encourage you to be a voter. I think we have succeeded tremendously in pushing the narrative.”

And we all know what backbreaking work it is to push narratives! In the bad old days before trade unions and labor regulations, children would earn just pennies as they toiled for 14 or 16 hours a day, shoving heavy narratives through dirty, dangerous vignette-shops.

Before years of protesting, the winning of health and safety regulations and the right to form labor unions, children did break their backs, or die, at work. But protesting is still inherently lazy, right? Taranto’s beneath contempt here.

3.) Jesse is a failure.

. . there is some truth to his statement that “we have succeeded tremendously in pushing the narrative.” But the truth of it makes his posturing all the more ridiculous.

“Occupy Wall Street” began as a left-wing protest, something about as exceptional as a pigeon in New York. It didn’t become a “narrative” until the narrators made it into one. Who are those narrators? They work for companies like Disney, CBS Corp., Comcast Corp. and General Electric Co. (co-owners of NBC), Time Warner, News Corp. (our employer), the New York Times Co., the Washington Post Co., the Tribune Co., Thomson Reuters Corp. and Bloomberg LP.

It’s the mega-corporations who are running protests. They’re the ones driving this thing. Rupert Murdoch is the puppet master here, and the protesters merely do his will.

This is beyond dumb — this is just poor propaganda. Taranto’s merely being a company-man, nothing more, albeit an incompetent one. For a Murdoch employee to pin this on Murdoch in Murdoch’s big business Journal amounts to farce. As if we don’t know nuthin’? It’s almost as if we’re being manipulated by dumb and greedy interests.

Behold Jesse LaGreca, who boasts of his working-class street cred while speaking the elitist jargon of the professor-cum-president’s failing administration. And he does so on ABC, owned by the Walt Disney Co. He’s an Audio-Animatronic revolutionary.

Someone could use a face-slapping.

Allen West, gossip columnist. Bitch and dish, dish and bitch . .

. . said this week that President Barack Obama was intentionally crippling the U.S. economy because he was a “marxist” and a “socialist.”

Ooooh, Allen, I just love you. You have dirt on everyone, girl. You get inside. Inside, for you, consists of being inside the heads of your own enemies from inside your own head. Sneaky. Convenient. Normally we’d call you a ‘tail-wagger,’ but, since you’ve gotten so celebrated for doing it, how about ‘Cindy Adams’?

Questions for Cindy? Do you think the president is trying to hurt the economy?

“It is intentional,” West declared. “It is intentional because this is who the president is. The president is a Marxist because he believes in the separation of classes.”

Oh snap. The ‘separation of classes’ is what Marxism and Communism were meant to destroy. Darn. Well, nobody said gossips had brains. It’s probably why they whine for a living.

“. . when you have a national leader that demonizes a certain segment of the society and attacks them, it has never ended up well. Yet, that is what we have. He is a socialist because he believes in nationalizing production.”

He’s, uh, waah? Taking his ‘Class War Revue’ coast to coast? Well, that is news. Score another for Cindy.

“President Obama’s policies have had a devastating effect on our economy, not just unemployment but investment,” conservative radio host Michael Berry told West Monday.

“The whole gambit,” West agreed.

Gambit: “A maneuver, stratagem, or ploy, especially one used at an initial stage.” No, Cindy. Witness the glitch in a gossip’s software: the need to look substantive. The want to appear intelligent and relevant while actually being useless. Tough gig. And then, there’s the bigger glitch: attending those personal needs through public malice. Wouldn’t want to be you, Cindy.