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Howdy all, a few Interesting Items for your information. Enjoy -

In this issue:
1. Fannie Mae
2. Oil Prices
3. Trails
4. Boating
5. Tongass

1. Fannie Mae. We are learning a couple of things with the financial difficulties of federally backed mortgage lenders Fannie Mae and Freddy Mac. The first is that public private partnerships remove market forces – consequences - from the companies, allowing them to make financially unsound decisions without fear of failure. The second is that they become dumping grounds for political cronies, much like Fannie Mae and Freddy Mac became dumping grounds for well-connected democrat insiders from the Clinton administration who used the mortgage institution as a vehicle to get very rich while. Jamie Gorelick, Vice Chairman of Fannie made over $26 million for five years’ work on the Board. Former Clinton Budget Director Franklin Raines earned over $90 million at Fannie. Together, the two companies carry over $5 trillion in mortgage debt. What happened? They got involved in lending money to people who could not pay their mortgages – the sub-prime mortgage mess. When the sub-prime mess started percolating through the industry and mortgage companies started failing, Fannie and Freddy no longer were getting paid back for the mortgages they had bought and sold. As a result, their stock prices over the last month or so have fallen by over 50%. Congress, particularly the democrats in the senate and both parties in the House, has been completely derelict in their duties and now see the solution as more regulation rather than more market forces. David Frum in the National Post on July 11 and Robert Novak in his July 17 column described the mess and how it came to be. Note that the two committee chairmen in congress – Chris Dodd (D, CN) in the senate and Barney Frank (D, MA) – have consistently stood in the way of real marketplace based reforms for both institutions. We the taxpayers are about to be put on the hook to back $5 trillion dollars in poor financial decisions. Solution? Complete privatization of both companies would be nice. At least Bear-Stearns went bankrupt, as did Countrywide. Should the management and oversight of Fannie and Freddy behave in a financially irresponsible manner, they ought to suffer the marketplace consequences of that behavior. How do we get from here to there? I don’t know. But I do know we must go there sooner rather than later.

2. Oil Prices. President Bush took off the gloves with the democrat majority in congress and announced that he would repeal the Executive Order prohibiting oil exploration and development on the outer continental shelves. Oil futures, which had ratcheted up through $147/bbl dropped sharply as a result, falling to around $129/bbl by weeks’ end. So much for the notion that production will not have an impact on prices, for prices fell nearly 12% on the threat of more drilling. Congress, with their 9% approval rating, is now on the hook to complete the deal and open offshore, ANWR and oil shale for exploration and drilling. Another congressional excuse for not drilling is that nothing would come on line for a decade. That’s what they said in 1995 when Bill Clinton vetoed legislation that would open the 1002 area of ANWR for oil exploration. Those million barrels per day would sure be nice to see coming down the pipeline right about now, wouldn’t they? Interestingly, there are known oil reserves sitting off the California coast of around 10 billion barrels, much of it with platforms and wells already in place. I have seen recent estimates of getting this production online within a year. Of course both Governor Schwarzenegger and much of the democrat-heavy congressional delegation strongly oppose this, but the issue is larger than California. Up here in Alaska, the feds announced lease sales of another four million acres of know oil reserves. The area may hold over 8 billion barrels of known reserves. Of course, the greens are typically outraged and promise to continue to file lawsuits citing environmental damage should the area be opened for exploration and production. We need not be dependent on nations that hate us for over 70% of our oil and natural gas. We need to start producing our own. The current shortage is artificial, a government induced shortage that has been a generation coming. It can be solved very, very quickly if we remove the current infestation in congress and replace it with a new infestation.

3. Trails. Eagle River is a suburb of Anchorage that sits about eight miles north of town. It is located on either side of Eagle River in a rather spectacular river valley. Homes and roads wind their way up the hillsides. It is surrounded on the east, like much of the Anchorage Bowl by the Chugach State Park and Chugach National Forest. The local McClatchy fishwrapper, the Anchorage Daily News ran a story Friday about a new trail that would connect Eagle River High School with surrounding homes. Trail planners are looking at building about six kilometers of new cross country ski trails, connecting them with five kilometers of existing trails. ADF&G biologists are predictably outraged, aghast at the notion of putting additional ski and recreation trails near the school and Eagle River because they will be using the same pathways as local brown bears. The article was written from the perspective of these out of touch state employees, darkly warning that there would be more maulings of children and the trail advocates would be at fault. Local residents rightfully point out that the damn bears are everywhere these days, that the state is not doing anything about them, and they are no longer going to be making decisions about what land to use and what land not to use based on how many bears there are on it. Sounds like the locals in Eagle River, much like the locals here in the Anchorage Bowl are starting to take things into their own hands and make the bear problem go away. In a related story, there have been 17 bear shootings here in Anchorage this year, which puts us on pace for a record year. There are an estimated 250 bears within city limits, so there are only 233 left to turn into rugs and wall hangings.

4. Boating. We conservatives pay a real price in liberty when we stay home and turn over the government to the leftists. One such example is the Clean Boating Act now slithering its way through congress. The legislation aims to control discharge of all substances into lakes, rivers and oceans. Under it, if you are out on a privet boat, catch fish, clean that fish, and hose off the waste into the water, you will be subject to EPA regulation and permitting. Improvement in the overall environment and cleanliness of the waters? Who knows? Loss of liberty? A bunch, for does not fish waste belong in the water where the fish can eat it, especially if is used as bait? ADN, Sun.

5. Tongass. Yet another set of timber sales in the Tongass National Forest, yet another series of environmentalist lawsuits. The excuse this time is that logging will harm the habitat of local deer populations, creating problems for the wolves and hunters. Nice of the greens to be concerned about the hunters, eh? The timber sales have progressed through the Environmental Impact Statement portion of the process. The greens take exception with the conclusions, and claim that estimates of deer populations are all wrong. As usual, nobody has actually gone out and counted deer or wolves. On the other hand, we do know the number of hunters down there and we do know what they are bringing home, and there are no restrictions on hunting due to low deer numbers that I know of, so my guess is that the deer population is just fine and green claims of ecological disaster are bogus (as usual). We will see what the courts have to say. With any luck, the decision handed down by 11 members of the Ninth Circus in an Idaho timber sales case will hold precedent. The opinion was handed down in late June, and overturns a 3-judge opinion that second-guessed the conclusions of the federal timber managers. Basically, the opinion threw out the greens’ complaint, noting that judges are not scientists and ought not to be in the business of second guessing managers who have done everything congress has required of them. ADN, Sun., Capital Press, July 3, 2008.

More later — AG

“If ye love wealth better than liberty, the tranquility of servitude better than the animating contest of freedom, go home from us in peace. We ask not your counsels or arms. Crouch down and lick the hands which feed you. May your chains set lightly upon you, and may posterity forget that ye were our countrymen.”
- Samuel Adams, speech at the Philadelphia State House, August 1, 1776.

Note: Interesting Items can be found also at the following locations: MatSu Valley News and the home page. Rod Martin’s The Vanguard site is also a long-time supporter of this column. Alex Gimarc is a long-time member of the Town Hall Conservative group.