Back in the day, I used to read the New York Times religiously. I mean, I lived in New York City, was young, and was making a lot of money. It’s what you do. It’s kinda like going to church on Sunday if you were a Puritan in the Massachusetts Bay Colony, or doing the Starbucks run for an enormous segment of the urban yuppie population.
Then I realized that the editrix of the Old Gray Lady typically had no f’in clue about what they were writing about with such authoritative gravitas. And nowhere is this more apparent than in the official Editorial section, the one written under the Times’ own byline.
We see this once again today in their editorial about Fannie Mae and Freddie Mac in which the Times Editors calls for a quick government rescue of the two beleaguered companies. The editors write:
Unfortunately, support for swift passage is mixed from one important quarter: Mr. Paulson’s boss, President Bush.
On Monday, the White House renewed its threat to veto the foreclosure prevention bill if it contains a $4 billion block grant program for states to buy up foreclosed properties. The veto threat is misguided, first, on policy grounds. Mr. Bush wrongly portrays the grant as a handout to speculators when its main thrust actually is to protect communities from a destabilizing buildup of abandoned, unsold homes.
Ah, yes, well… so the Times hates Bush. This is news?
What is news is the Times’ claim that the $4B block grant program will not be a handout to speculators. Here is a situation where the Times confuses intent with impact. The intent of the $4B handout may be to “protect communities” but the impact is to payoff speculators who took on financial burdens that they could not handle.
Where does the Times get the confidence to assert that the $4B will not end up in the hands of speculators? What data or research can they point to to back up such a claim? Oh that’s right — none.
Meanwhile, there are numerous other ways for communities to protect themselves from destabilizing buildup of abandoned homes. Here’s just one suggestion.
Furthermore, there’s this laughable passage:
The veto threat also is a bad idea politically. Mr. Bush has not objected when the big firms and rich executives of Wall Street have been on the receiving end of federal assistance, but now he is threatening to block a measure to aid hard-hit neighborhoods filled with ordinary Americans.
Uh… dear Pinch & Gang… even with the bad financial news that probably means Fannie is bankrupt… it’s still a $15B company. It’s hard to get any bigger, and it’s hard to be a richer executive than the boys and girls at Fannie and Freddie. So.. WTF are you talking about? A Fannie/Freddie rescue would absolutely be corporate welfare at its finest, justified by some mumbo-jumbo about stabilizing the market, or some such. Those were the same arguments offered up when the government arranged for a bailout of Bear Stearns or Long Term Capital. It’s the exact same thing.
Furthermore, the reporters of the New York Times itself are saying, “We have no idea what this bailout will cost us“:
The proposed government rescue of the nation’s two mortgage finance giants should appear on the federal budget as a $25 billion expense, the independent Congressional Budget Office said on Tuesday, but officials conceded that there was no way to really know what, if anything, a bailout might cost taxpayers.
Do the editors of the Times read their own damn paper?
Basically, the Times believes that we should write a blank check so the rich executives and investors in Fannie and Freddie can cash out. Good idea, guys. It sucks that the government is going along with it, but that doesn’t excuse the utter ignorance of the Times.