The Truth About the Current Financial Crisis

This blog is supposed to be about my experiences in law school, but every once in awhile, I have to take on current events. Earlier this week, our school had a professor that used the email list serve to send out a email which blamed the current crisis on the Bush Administration. In addition, it stated that George W. was going to hand out a 700 Billion dollar blank check to his pals on wall street. This set me off. Law professors should be more educated about the powers of the president than the average person. When I go to the nail salon, I expected to hear a comment like this. I do not expect to hear this at my school.

Here is the truth: In 1977, a Democratic controlled Congress passed The Community Reinvestment Act in which President Carter signed into law. This instructed lending institutions to expand the percentage of loans issued to minorities and the poor for homes. In 1995, under a Democratic controlled Congress, this act was expanded tremendously and signed by President Clinton. This directed that 42% of all of Fannie Mae and Freddie Mac's loans must be issued to low income and minorities. Thus truly began the sub-prime mortgage nightmare. There were no regulations built in that allowed for executive power oversight, and indeed no independent agency was given the authority to oversee what was happening within the mortgage practices. Delegating this oversight is the responsibility of THE CONGRESS, not the President. Fannie Mae and Freddie Mac began issueing loans to people, where it took 40-50% of thier incomes to make the monthly payments. With the price of oil and food increasing dramatically in the past 2-3 years, this caused substantial strain on the ability of people to pay their mortgage notes.

Now, this is an ABC Sesame Street account of the story because it is much more complex than this. This recount does not account for hedgefunds and the lack of oversight on the wall street fat cats.

In 2003, the Bush Administration recommended what the NY Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago." This change was to move governmental supervision of two of the primary agents guaranteeing subprime loans, Fannie Mae and Freddie Mae under a new agency created within the Department of the Treasury. However, it did not alter the implicit guarantee that Washington will bail the companies out if they run into financial difficulty; that perception enabled them to issue debt at significantly lower rates than their competitors. The changes were generally opposed along Party lines and eventually failed to happen. Representative Barney Frank(D-MA) claimed of the thrifts "These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis, the more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." Representative Mel Watt (D-NC) added "I don't see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing."

This is worriesome to say the least that we have placed, as a country, the power in the hands of the democrats who refused to see the writing on the wall. I point this out to say that Bush's Administration attempted to address this issue 5 YEARS AGO. AND CONGRESS FAILED TO ACT. I think this was willful blindless on behalf of the branch of government that is supposed to make the laws and to arrange for oversight of the laws.

If the Bush Administration is guilty of anything, it is in not being aggressive enough in bringing the problem to light. Perhaps the administration was distracted by other issues, but that does not excuse the Administration for remaining silent for so long. They should have been calling the Congress out on the carpet and alerting the American people of the fact that their elected officials were unwilling to regulate this are of law. Too much rides on financial markets for these institutions not to be regulated by the government. I do not mean controlled, I mean under scrutiny for abuse.

Congress makes the laws. The President enforces the laws. Period. But right now, it does not matter who got this country into the situation, what matters now is how do we get out? It is time for all of us to let our officials know that enough is enough, and if you can't fix this responsibly, then we the people, will boot your butts out of office November 4th. Stop bickering and start working---Oh, and make the fat cats pay, not we the people. We did not get us there, you did Congress men and women. Suck it up and stick it to those that abused the system and those that fell asleep at the wheel when they should have been watching.

2nd Year Stress

Second year in law school, I am finding, is absolutely tougher than the first year. Let me explain. As a second year law student, you know the ropes of the schooling. You know how to outline, you know what you can get away with as far as reading/not reading, you know your own study habits. So the journey should be easier, right? Wrong.

There is one major change: work. The first year of law school, at least at Willamette, you are banned from holding a job. But your second year, it is considered an advantage. Now don't get me wrong, I love me job. I believe in what I am doing, I work with a GREAT group of lawyers and paralegals, and in many respects classtime is about learning the law, but at work I get to see the law applied to the "real world." This is irreplaceable. However, it is difficult to balance work and school. Throw into that children, housework, and a daughter's very busy social schedule = one VERY tired mommy.

I am approaching the wall hitting break. Unfortunately, I had not come even close to this mythical, but real wall, last year until November.

Last year for me was a breeze. This year is feeling a little stormy.

I Survived!

I survived my first year of law school and feel such a sense of awe and acomplishment! My brain is so numb right now though---numb enough that I don't even want to touch the stack of fiction I have been eagerly awaiting the ability to have time to read. I sat on a recliner all weekend and enjoyed the ability to do nothing, but by Sunday evening I began to feel like I did not even know what I would do with myself!

Tips to incoming students....

These past several weeks have been so interesting to me because I have met several admitted students. I have had time to think about what I wished I would have known or things I was glad to have known. Here they are.

1. I am so glad I had knowledge of the basic set up of our government system and how it worked. I watched fellow students who had no background, but degrees in psychology or math, struggle with not only learning "law" speak; but learning basic government structure. I was a poli sci major and the first couple of weeks for me where a breeze. LESSON: Read up this summer on the structure of the US government if you have no background in that area.

2. I wish I would have had a student mentor. Willamette has this program, but I did not utilize it. 2 and 3L's are a source of knowledge like no other. They have slogged through the trenches and most are willing to help you out. LESSON LEARNED: Get a mentor or befriend upper classmen. This way you do not waste valuable time or resources.

3. I wish I would have invested more in study aids. Law school really is about learning on your own. Study aids are a great tool in doing this. I wish that I would have borrowed, bought, or checked out more study aids. Unfortunately, I paid no attention to these nifty little aids until finals my second semester. LESSON LEARNED: Crunchtime is your friend.

4. I wish I would have stayed in touch with my friends. My biggest regret is distancing myself from my friends. During law school, you need as much support as you can get and friends are a valuable source of encouragement, strength and peace of mind. LESSON: Lean on your friends. They won't understand everything that happens to you; but they will understand you.

5. I wish I would have taken hand notes, rather than used my laptop in class. Why? Two reasons. 1) Because if you handwrite, then you transpose on to the computer which translates to repetition and helps in memory. 2) Computer = temptation to surf the internet. Sometimes, especially if the subject matter is boring, the temptation is too much to bare. LESSON LEARNED: Computer good, handwriting better, Internet = bad.

6. I wished I would have talked to more law students before entering law school. I can not tell you how many times I was surprised, shocked, or did not understand how it was really going to go until AFTER attending school. I never understood the significance of the mandatory curve, or what Moot Court was, or about First Year Appellate arguements. I did not know what the first year classes was really like, or what the Socratic method was. I did not understand how scary and intimidating that professors could be (or how nice, or how pontificating). LESSON LEARNED: Research is important; forewarned is forearmed.

7. I wish that I would have taken Legal Research and Writing more seriously. I did not see the importance of this class until it was almost too late. In addition, because at Willamette this is a pass/fail class, you do what you have to just to pass. And in doing so, you cheat yourself of VERY valuable skills, maybe the most important you will gain in law school. LESSON: Even if the class seems worthless, it is not.

Finals Contract Over

Yesterday, I had the misfortune of experiencing the most BRUTAL exam I have ever experience to date in my law school experience. Mr. Runkel, if you read this---CHEERS, you accomplished something no other Professor has done, rattled me.

I walked out of that exam room literally numb------my brain could not function at all. I also walked out and realized I missed a CRUCIAL element of reasoning on the exam. I left out 3rd party beneficiary. So, I think the best I can hope for there is about a B, maybe. Only time will tell.......

Time to move on. Friday is International Law. So, as it stands, 1 is down, 3 more to go!!!!

Approaching Finals.........

Fate sometimes has a sick sense of humor. Friday morning, the last day of classes, I wake up with a sore throat so bad and a fever. Golly gee---apparently stress raises a hormone in your body that then weakens your immune system:) Go figure.

So I finished classes. I weird thing about the conclusion of classes for the semester is that the students applaud the Professor. Interesting thing to do and I have never understood it. I mean are we applauding a job well done; or are we really applauding the fact that this person that either bored us, tortured us, patronized us, humilated us, or in some ways truly entertained us--is out of our lives for a few weeks or months?

Saturday I woke up feeling even worse. Which was terrible because I needed to study. And I had committed to speak on a panel to admitted students. The Admissions office (which by the way are some of the coolest people in the building), put together a preview day. Admitted students came and were treated to a "mock" class taught by a Con Law professor. They also were able to sit on panels to ask questions.

My panel dealt with attending law school with partners or children (or in some cases both). I was the only single parent on the panel and found a lot of people directed questions my way. A wife of a past student on the panel tried to explain what it was like living with a law student. She said that finals week was the worst because students live, eat, and breathe law. That we often are dazed and thinking only about rules and principles. As she is saying this, I realize that yep, I am there but not, and in fact, I am repeating the rules of contract law and unconscionability in my head!!! So true and funny.

Afterwards, there was a fabulous reception including free booze. I refrained from drinking (beer, cold medicine, and head colds generally do not mix well), but I did meet some really cool students coming into the school next year.

What was cool and energizing was seeing their excitement and energy. After a long and grueling first year, it was so refreshing to let their buzz influence me!

Approaching the end of my first year.....

I have a total of four more class periods to complete....and then onto finals. This is such a scary, yet exhilerating thought. I have learned more about myself in the last eight months than at any other time in my life. As I reflect back I am amazed at how hard I was stretched (at times painfully so), how I was challanged, and most of all, how proud I am of my response.

This has been a first year of accomplishments. Surpassing my own goals on grades for my first semester, capturing a job in a division that I wanted, placing runner-up in the First Year Appeallate Competition, and earning a spot on Willamette's Moot Court Board. I have worked hard, lost sleep, and dreamed big.

This is an important testimony for single parents around the nation. It is possible to succeed and excel in law school while having a child. My firm belief is that having a child gives you focus and forces the student to prioritize. The student becomes creative and thinks out of the box in problem solving, both in the classroom and at home.