Another step towards socialism? Dick Morris says that’s what the Finacial Regulation Bill is

Using the words socialism and President Obama in the same sentence has become so overused at this point, that many immediately discount it as more right-wing rhetoric.  However, in this case it might pay to take a look at where Morris goes with this.

After Republicans made news several weeks ago by filibustering a vote to open debate on the Financial Regulation Bill, the final passage of the bill was aided by four Republicans who crossed over in support of the bill.  While Senators Susan Collins and Olympia Snowe are liberal Republicans and often vote with the Democrats, it surprised many that Senators Scott Brown and Chuck Grassley also sided with the Democrats on another piece of legislation that passes a large chunk of the American economy over to Government control.

Maybe Brown thought this was the “people’s bill”.  In one of the first true tests of what type of Republican Senator Brown will be, many feel he came up well short of the mark.

Dick Morris explains why this bill is so dangerous, especially when stacked on top of Obamacare:

The bill authorizes the Secretary of the Treasury – a political appointee – to seize any financial company (bank or nonbank) simply because, in his opinion, it is too big to fail and in danger of insolvency.  This power can be used for political retribution, pressure for campaign funding, or any other abuse bureaucratic whim or partisan politics can conceive.  It is a power Fidel Castro or Hugo Chavez would love to have!

The legislation also requires that any business that extends credit, in any form, needs to clear the loan instrument in advance with the new consumer protection agency.  The backlog of pending applications will strangle consumer credit.

Now the federal government has effectively taken over about one third of our national economy by passing Obamacare and regulatory reform in almost the same breath.

It’s hard to know exactly where to place this bill on the ‘alarm’ scale.  On the one hand, the bill failed to regulate what many would argue are the institutions that played a major role in the near economic collapse of the US economy, Fannie and Freddie, which also happen to be big financial supporters of the Democratic party.   It was Democrats like Barney Frank and Luann Waters, along with Obama adviser and former CEO of Fannie Mae, that blocked every attempt to impose reasonable regulations on Fannie and Freddie over the last 5-8 years.    Raines was reported to have earned about $90 million in his five years as Fannie Mae CEO, which he later had to partially repay in a settlement related to overstating Fannie’s earning by nearly 50% while he was CEO.

The role of Frank, Waters, Raines and other Democrats in what led up to the financial crisis is important, because the Democrats have used the economic melt down, caused in large part by liberal meddling and regulations, to declare a failure of the free market system and claim it proves that deregulation doesn’t work.  They hide the fact that they not only lowered the capital requirements for Fannie and Freddie and fought all Republican attempts to require levels of capitalization on par with banks that provide loans, but also mandated that  banks give a certain percentage of their loans to people that otherwise would not qualify for a loan.  They forced banks to provide loans to people who were likely to default on the loans, and as a result helped create the sub-prime nightmare that almost destroyed the American financial system.

Now, after liberal meddling created this mess, they say, “the Government is here to save the day” and pass a Financial Regulation Bill that gives the politically appointed Secretary of the Treasury the ability to seize any financial institution that he or she deems to be too large to fail.

Many believe that the true goal of Obamacare is to create an environment where insurance companies cannot remain profitable, and therefore cannot survive, so that the public insurance exchanges can be replaced with what President Obama and other Democrats have openly said is the end goal, which is a single payer, or national health care system.

While some scoff that off as paranoia and conspiracy talk, when you look at how the Democrats have managed to cause a near financial collapse, and use it as a justification for passing a bill that can lead to the takeover of the financial system, those paranoid ramblings start to look a whole lot less paranoid and a whole lot scarier at the same time.