CNN’s Lou Dobbs railed against free market proponents on July 22 and even called for them to be punished in an unusual manner.
On “Lou Dobbs Tonight,” Dobbs’ attack on capitalists was based on troubles faced by Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE), two large government-sponsored enterprises (GSEs).
“Well the – it’s a, it’s quite a mess, quite a mess indeed,” Dobbs said. “And I love the idea that all these free traders, free marketeers now got to have the government to, to bail them out. If I hear one of these ignorant, hypocritical, sanctimonious free traders ever talk about free markets again, they should be pilloried. I mean they are absolutely – this is an administration of jerks and cowards and fools. I mean it’s unbelievable.”
Dobbs was referring to a historic form of punishment for criminals in which the offenders would be locked into stocks in public places to maximize humiliation.
Investor’s Business Daily and The Wall Street Journal both explained that the Fannie and Freddie problems were not an example of market failure (as Dobbs suggested), but of the socialist underpinnings of the two GSEs.
“What taxpayers need to understand is that Fannie and Freddie already practice socialism, albeit of the dishonest kind. Their profit is privatized but their risk is socialized,” said a Journal editorial on July 12.
Despite that, Dobbs blamed the Bush administration for the struggles of the housing market, insisting the administration could have acted to cool off a housing market that allowed people to borrow more than they could afford.
“We’ve been reporting for months on this broadcast about the Bush administration’s failure to address adequately the housing crisis,” Dobbs said. “As millions of middle class Americans have been hurt by foreclosures the White House has consistently denied the problem. As [CNN correspondent] Kitty Pilgrim reports, this month alone, the administration has contradicted itself many times about the state and health of our economy.”
Pilgrim added her own comment about the legislative process concerning President George W. Bush and a housing bill that is working its way through Congress.
“It is inconceivable that it has taken this long to get this legislation together,” said Pilgrim.
President Bush announced on July 23 that he would drop his opposition to a housing bill. The bill passed in the Senate and is awaiting a vote in the House. It would allow the government to help struggling homeowners get less expensive loans. It would also allow the government to offer federal cash to help bail out Fannie Mae and Freddie Mac.
Dobbs has harshly condemned the president in recent broadcasts. On June 19, he called for Bush’s impeachment in the wake of the recent salmonella outbreak.
But Dobbs himself used to be a proponent of free market principles. As the Business & Media Institute’s “Biz Flog” detailed in June, Dobbs has seen book sales and ratings increase as he has taken a more populist tone.
