The Republicans' stupid mortgage plan

Republican economist Ed Glaeser says Republicans have a stupid mortgage plan:

It is particularly disappointing to see Senate Minority Leader Mitch McConnell embrace "providing government-backed, 4% fixed mortgages to any credit-worthy borrower" as his alternative to the Barack Obama/Nancy Pelosi stimulus package. ...

Since lenders have recovered their sanity and are once again requiring appropriate down payments, buyers are more constrained by the need to come up with 20% of the purchase price than they are by interest rates. Today's down-payment requirements and low interest rates suggests that mortgage markets are working well and have little need for governmental "help." ...

Subsidizing mortgages is an idea from the New Deal, not the Republican playbook. Fannie Mae and the Federal Housing Administration were set up by liberal Democrats to encourage borrowing. Subsidizing interest rates appealed to big-government interventionists because the expense is kept off federal balance sheets, at least for a while. The true costs of Fannie and Freddie were long shrouded, despite the efforts of some Republican senators. Likewise, the full costs of subsidizing 4% mortgages will appear only over time, as the government is put on the hook for default after default. ...

We are in the ruins of a housing market made worse by subsidized lending. The government has no business egging people on to borrow as much as possible to bet on housing prices. There is plenty of room to criticize the current stimulus plan, but Republicans need to adopt Ronald Reagan or Dwight D. Eisenhower, not Harold Ickes, as their intellectual role model.

Sarah Palin correctly blames Bush for election loss

Sarah Palin is not as dumb as some Republican political weasels claim. She knows why she lost:

“I think the Republican ticket represented too much of the status quo, too much of what had gone on in these last eight years, that Americans were kind of shaking their heads like going, wait a minute, how did we run up a $10 trillion debt in a Republican administration?” Palin told the Anchorage Daily News and Alaska’s KTUU Channel 2.

“How have there been blunders with war strategy under a Republican administration? If we're talking change, we want to get far away from what it was that the present administration represented and that is to a great degree what the Republican Party at the time had been representing. So people desiring change I think went as far from the administration that is presently seated as they could. It's amazing that we did as well as we did.”

Democratic landslide?

The Democracy in America blog reports:

SOMETIMES I wonder if the Republicans have already given up on Congress this election year. Whether by circumstance or by design, the Democrats seem to have taken all of the advantages as they seek to expand their majorities, and they are using them. The latest, from the Wall Street Journal’s number crunchers, is that a slew of Democratic challengers are raising lots of money, coming close to or surpassing their opponents. Established GOP senators such as Alaska’s Ted Stevens, North Carolina’s Elizabeth Dole and Maine’s Susan Collins all face challengers with large war chests. On the House side, the Democratic Congressional Campaign Committee nurses a large money edge over its GOP rival, and Democratic incumbents are holding their own as well, leaving cash for unseating Republicans. It feels like the Republicans just don’t want it.

Democrats are also reusing some of their winning tactics from 2006. Real Clear Politics’s Reid Wilson examines how the Democrats have embraced the centre in their Congressional recruiting, while the Republican caucus becomes more conservative. A big question in the caucus has been whether seeking ideological purity on the right will make the GOP a permanent minority party again while the Democrats rebuild their big tent. This is more likely than not, barring a period of Democratic corruption and misrule. Republican congressional leaders had better learn to run the opposite direction and, for that matter, to raise more money.