What a Mess

John McCaslin
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Posted: Mar 18, 2009 11:00 AM
What a Mess

So how did we get into this mess?

It was exactly one year ago that the Federal Reserve took the unprecedented step of loaning $29 billion to JP Morgan Chase after the financial services giant acquired Bear Stearns, the once mighty global investment bank and brokerage firm that virtually collapsed overnight.

That's when the plug got pulled from the dam.

"Today is the anniversary when you might say a lot of this started," Rep. Michele Bachmann, Minnesota Republican and member of House Financial Committee, told Inside the Beltway late Monday. "It laid the groundwork for the federal government bailing out AIG [American International Group] and the other entities that occurred after that."

Now, the congresswoman pointed out, about 80 percent of AIG is owned by the federal government.

"So you might as well say it has been nationalized," she said. "A lot has happened over this last year."

She said while it is "egregious" that $160 million in bonuses were set aside for AIG employees, that's only one issue: "To me the bigger issue is what AIG has done with this $170 billion [in federal loans]. Nobody really knows. That's really where the conversation needs to be."

Mrs. Bachmann faulted the House Financial Services Committee, chaired by Rep. Barney Frank, Massachusetts Democrat, and the Senate Banking Committee, chaired by Sen. Christopher J. Dodd, Connecticut Democrat, for still not seeing to "reforms" of the financial industry.

"That's the outrage that we need to focus on," she said. "The American taxpayer is paying a high price for the sin of government - the fact that government ... has yet to reform itself ... We still haven't seen a full examination of how we got into this mess."

NERDY GUY

"Obama is boring," insists MSNBC's Chris Matthews. "He's kind of a nerd."

Addressing the Institute of Internal Auditors' 30th General Audit Management Conference at the Gaylord National Resort and Convention Center on Tuesday, the cable TV host added on second thought that labeling President Obama a nerd was perhaps a bit strong.

A big fan and cheerleader for Mr. Obama, Mr. Matthews called him "serious-minded" and "ambitious," having set out to imitate three models: Abraham Lincoln; Lyndon B. Johnson and Ronald Reagan; and Chicago's political machine.

Like Lincoln, he said, Mr. Obama for reasons other than "love" assembled in his Cabinet a team of rivals, not the least being Secretary of State Hillary Rodham Clinton. He explained that when you own a name like "Barack Hussein Obama," one way to cut a deal between Israel and the Middle East is to bring leaders like Mrs. Clinton into the fold.

As for the second model, Mr. Matthews said history tells the new president it's important to act quickly: Mr. Johnson and Mr. Reagan, he noted, wasted little time carrying out mandates during their first months in office.

Concerning the Chicago model, "They are really tough," Mr. Matthews said of Windy City politicians. "The way they deal with Republicans is to ignore that they are there."

OUCH!

"Looking at all of you, I'm reminded of a greeting President Reagan once offered the guests at this gathering. 'On St. Patrick's Day,' he said, 'you should spend time with saints and scholars. So I have two more stops to make.' "

-President Obama, speaking at House Speaker Nancy Pelosi's St. Patrick's Day Lunch at the U.S. Capitol on Tuesday

UH OH

It was one week ago today that the State Department boasted in this column that the U.S. passport has become "one of the most secure travel documents produced anywhere in the world."

Three days later, a Government Accountability Office (GAO) investigation warned that terrorists can easily obtain a genuine U.S. passport. GAO conducted four tests, and unfortunately was successful in obtaining a U.S. passport in each case.

"In the most egregious case, an undercover GAO investigator obtained a passport using counterfeit documents and the Social Security Number (SSN) of a man who died in 1965," it says. "In another case, the investigator obtained a passport using counterfeit documents and the genuine SSN of a fictitious 5-year-old child ... even though the investigator's counterfeit documents and application indicated he was 53 years old."

The GAO investigator later purchased an airline ticket, used the passport as proof of identity, got a boarding pass, and passed through an airport security checkpoint.