December 12, 2008 9:41 PM

Gov't Studies Say Progressives Were Right, Beltway Was Wrong

My newspaper column this week takes a look at three recent government reports that prove when it comes to righting our economy, progressives were right, and Beltway insiders were wrong.

Remember when progressives protested the 2005 bankruptcy bill? Remember when we said it would wreak economic havoc? And remember when Congress overwhelmingly passed it anyway? Well now a new report from the New York Federal Reserve Bank - not exactly communists - says that bill is playing a decisive role in the foreclosure surge that undermined our entire economy. Specifically, the bill effectively forces debtors to pay off their credit cards before making mortgage payments, thus throwing them into foreclosure. The Fed estimates that since 2005, the bankruptcy bill is directly responsible for causing 400,000 more foreclosures (32,000 per quarter) than the economy would have generated otherwise.

Remember when progressives opposed the bailout and said that while there was certainly a real economic problem at hand, Wall Street had not made the case that there was an apocalyptic credit crisis warranting a $700 billion bailout? Remember how bloviators like Doris Kearns Goodwin took to PBS to call bailout opponents "irresponsible?" Remember how almost every Establishment media voice and politician berated bailout opponents as unacceptable ideologues who didn't care about the economy? Well now a new report from the Minneapolis Federal Reserve Bank says exactly what we were saying all along: That the government lied to us, and that the hard data proved that the claims about a lending crisis were fabricated.

Finally, remember when progressives said there weren't adequate oversight controls included in the bailout legislation? And remember when politicians - especially Democrats - insisted that they had "fixed" the bailout and made sure it included strong safeguards? Well now a new report from the General Accountability Office agrees with progressives, saying that there's almost no oversight at all, and that huge truckloads of taxpayer cash is at risk of being stolen, bilked, or otherwise wasted.

You'll notice that other than a few scant stories about that latter report, the media has almost completely ignored these damning studies. In our country, it doesn't matter what the chattering class says and how wrong these fools are - people like Goodwin and the like retain their media credentials and teevee platforms as supposed "experts."

But the fact remains that what we now have is crystal clear proof that the real pragmatists were progressives sounding the alarm, and the real fringe ideologues were the Beltway insiders who sneered at us for raising objections.

Maybe now, having been so utterly humiliated, these people will start listening to us.

Read the whole column here.

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UPDATE: For those interested, I forgot to include this in the original post. See here for the raw data on inter-bank lending that the Minneapolis study was based on. Pretty incredible how consistent it has been since they said there was a "crisis."