FRONT PAGE CONTRIBUTOR
What’s lurking in the big bailout
How many of thses deals can we take?
Bill Smith and Ed Morrissey reveal that lurking in the proposed $700 billion bail out of the financial sector is a provision to fund community organizer groups that have historically supported, and in return have been supported by, the Democrats.
Item 3(a) in the “Agreement on Principles,” reached by the U.S. Senate Banking Committee concerning the big $700 billion bailout reads:
“Directs a certain percentage of future profits to the Affordable Housing Fund and the Capital Magnet Fund to meet America’s housing needs.”
Morrissey explains what “future profits” means in the “Agreement on Principles,” by providing this language from Senator Dodd’s proposal:
TRANSFER OF A PERCENTAGE OF PROFITS.
1. DEPOSITS.Not less than 20 percent of any profit realized on the sale of each troubled asset purchased under this Act shall be deposited as provided in paragraph (2).
2. USE OF DEPOSITS.Of the amount referred to in paragraph (1)
1. 65 percent shall be deposited into the Housing Trust Fund established under section 1338 of the Federal Housing Enterprises Regulatory Reform Act of 1992 (12 U.S.C. 4568); and
2. 35 percent shall be deposited into the Capital Magnet Fund established under section 1339 of that Act (12 U.S.C. 4569).
REMAINDER DEPOSITED IN THE TREASURY.All amounts remaining after payments under paragraph (1) shall be paid into the General Fund of the Treasury for reduction of the public debt.
That provision will allow money from future “profits” to be given to nonprofits organizations like ACORN, National Council of La Raza and even the National Urban League.
Instead of being returned to the treasury to retire the debt incurred in providing the big bailout, this pre-direction of future funds (profits) means those returns will be used to underwrite potential questionable (perhaps even illegal activities) of certain nonprofits. Entities which have had a hand in promoting and expanding access to “no money down” loans, illegal voter registrations and extensive lobbying activities.
In an article entittled “Democratic Ally Mobilizes In Housing Crunch,”The Wall Street Journal has reported the connection between the Affordable Housing Fund and the Capital Magnet Fund and ACORN, National Council of La Raza and the National Urban League. The die seems to have been cast in the July Housing Bill that was supposed to rescue Fannie Mae and Freddie Mac resolve the nation’s housing meltdown.
Democrats were able to steer millions of dollars in housing and other grants from the federal government toward Acorn and similar groups. The housing bill included a new, permanent source of affordable-housing money that congressional Democrats and grass-roots groups have sought for years. Under the Housing Bill, the Affordable Housing Trust Fund and the Capital Magnet Fund. will be funded by a tax on mortgages backed by Fannie Mae and Freddie Mac.
According to the Wall Street Journal, that tax will eventually make upwards of $600 million annually in grants available to ACORN and other groups. Under the “Agreement on Principles,” there will be even more of our tax dollars available to ACORN and the rest to conduct questionable activities.
What else lurks in this big bailout? How much are we willing to let the federal government spend to “resolve” the nation’s housing mess? How many more times will we let the Feds bailout various entities before we say enough? How many more nefarious funding deals for organizations that, like ACORN, have already been proven to engage in questionable activities?