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Can You Really Blame Bush for The Economy?
Myself | 04/17/2009 | Matthew Council

Posted on 04/17/2009 8:42:13 AM PDT by MattAMatt

I keep hearing that the Bush economic policy was to blame for the economic crisis we now face. Lord knows Bush's budgets were way out of line, even though he had 9/11, Wars, Katrina, Power Outages in NYC and the like (secondary causes of recession). The fact is that the primary culprit behind the economic crisis was the statist policies from Carter & Slick Willy that Bush inherited:

1977 CRA Community Reinvestment Act - The act provided that banks have an "affirmative obligation" to meet the credit needs of the communities in which they are chartered.

1989 Congress amended the Home Mortgage Disclosure Act requiring banks to collect racial data on Mortgage applications.

1995 Treasury Department issued regulations tracking loans by neighborhoods, income groups, and races to rate the performance of banks. The ratings were used by regulators to determine whether the government would approve bank mergers, acquisitions, and new branches. It also encouraged statist-aligned groups, such as the Association of Community Organizations for Reform (ACORN) and the Neighborhood Assistance Corporation of America, to file petitions with regulators, or threaten to slow or even prevent banks from conducting their business by challenging the extent to which banks were issuing these loans. With such powerful leverage over banks, some groups were able, in effect, to legally extort banks to make huge pools of money available to the groups, money they in turn used to make loans.

The Banks and community groups issued loans to low-income individuals who often had bad credit or insufficient income. And these loans, which became known as "Subprime" loans, made available 100% financing, did not always require the use of credit scores, and were even made without documenting income. Basically, the government insisted that banks abandon traditional underwriting standards if the bank wanted to grow. Not to mention that in 1992 Freddie Mac and Fannie Mae were pressured by the HUD to purchase large bundles of these loans for the conflicting purposes of diversifying the risk and making even more money available to banks to make further risky loans.

Congress also passed the Federal Housing Enterprises Financial Safety and Soundness Act which eventually mandated that these companies by 45% of all loans from people of low and moderate incomes. The Treasury Department also established the Community Development Financial Institutions Fund, which provided banks with tax dollars to encourage even more risky loans.

When you add derivatives and Greenspan into the mix, you have an economic crisis, not just a housing/banking crisis. This cannot be blamed on Just President Bush by any stretch of the imagination. I am not at all excusing Bush from any responsibility. He made his share of mistakes. But to insist that he was entirely to blame ignores years of damaging statist government intervention.

I can't think of a better time to have the statist of all statists in office and a majority statist Congress. Can you?


TOPICS: Issues; State and Local; U.S. Congress; U.S. Senate
KEYWORDS: bho44; bhoeconomy; blame; bush; bushsfault; congress; economy; obama
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1 posted on 04/17/2009 8:42:14 AM PDT by MattAMatt
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To: MattAMatt

NO.

But unfortunately in politics as the sitting president when thing hit the fan he gets the immediate blame. Although 40 years from now it will be looked on differently with a longer term view on the various aspects that lead up to this including what you posted.


2 posted on 04/17/2009 8:44:38 AM PDT by djl_sa (Looking forward to 2012!)
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To: MattAMatt
It was whoever forced the mortgage industry to issue loans to subprime borrowers. Once those "standards" were in place, the bubble blew up.

Now, who could that have been? Hmmm?

3 posted on 04/17/2009 8:47:54 AM PDT by LouAvul
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To: MattAMatt

CRA, Fannie & Freedie, Frank-Dodd-Congressional Black Caucus protecting Fannie & Freddie, O’s hedge fund short [als like Soros and offshore crash money - probably the Saudis.

the stock market discounts the future i.e. anticipates events 6 to 12 months in advance.

Look at the chart of the S&P 500 or DOW around June 2008 when Hillary had the nomination stolen from her by ACORN thugs at caucuses. When she was finally out around June 2008 - the market started slipping. Fall of 2008 when McCain’s poll numbers were weak - the market knew it was over. Tiny rally a few days before election with a glimmer of “hope.” After O was elected down, after sworn in down.

This is all about O, Pelosi & Reid 2006 Congressional control and total socialist fraud from CRA and crony capitalism with O cronies destroying Fannie & freddie from inside, Raines, Gorelnick, Rahm, and others. Stan O’NEil possibly at Merrill as Merrill never did mortgages before Stan.


4 posted on 04/17/2009 8:50:49 AM PDT by Frantzie (Boycott GE - they own NBC, MSNBC, CNBC & Universal. Boycott Disney - they own ABC)
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To: MattAMatt
That is really an easy one to answer. At least Bush did not deliberately try to bring down our economy to suit some twisted anti-American agenda. He did not put our generation, and future generations, into extreme debt just to finance a socialist agenda and future empowerment. He did not ATTEMPT TO INTIMIDATE AMERICANS to suppress dissent against radical, anti-American, unconstitutional agendas.

And at least he did NOT LIE ABOUT REAL TAX CUTS. No, I will take Bush back any day compared to what we are stuck with now.

5 posted on 04/17/2009 8:51:39 AM PDT by EagleUSA
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To: djl_sa

Isn’t the real question one of why didn’t the Republican “leadership” effectively counter the lies about the causation instead of letting the Democrats and their media cohorts constantly reiterate about the “failed policies of Bush?”


6 posted on 04/17/2009 8:53:27 AM PDT by AmericanVictory (Should we be more like them or they more like we used to be?)
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To: MattAMatt
for emphasis ... excerpt ...

“The Banks and community groups issued loans to low-income individuals who often had bad credit or insufficient income. And these loans, which became known as “Subprime” loans, made available 100% financing, did not always require the use of credit scores, and were even made without documenting income. Basically, the government insisted that banks abandon traditional underwriting standards if the bank wanted to grow. Not to mention that in 1992 Freddie Mac and Fannie Mae were pressured by the HUD to purchase large bundles of these loans for the conflicting purposes of diversifying the risk and making even more money available to banks to make further risky loans.

Congress also passed the Federal Housing Enterprises Financial Safety and Soundness Act which eventually mandated that these companies by 45% of all loans from people of low and moderate incomes. The Treasury Department also established the Community Development Financial Institutions Fund, which provided banks with tax dollars to encourage even more risky loans.”
...
__________________________________________________________

Thank you for this article. You have provided the basic causes here ... Stupid decisions, as policy long term.

Implemented by and added onto the extension of the ‘civil rights’ decisions begun during Lyndon Johnson's presidency.

God have mercy on your people. Amen.

7 posted on 04/17/2009 8:57:34 AM PDT by geologist (The only answer to the troubles of this life is Jesus. A decision we all must make.)
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To: MattAMatt
Dear Clueless Writer:

The fact is our elected representatives failed to represent the people and they have all contributed to the problems America faces. I'm sick of the idiotic blame game. You will loose taking this route.

Government has lost it's way and Congress has failed the people. The executive office has failed. Bush “suspended free market principals to save them”. What a crock of crapola with granola.

So, here are a couple dollars so someone can help you with your bags. You're obsolete. Off you go.

8 posted on 04/17/2009 8:57:43 AM PDT by SQUID
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To: SQUID

Dearest Squidly,

Only one problem...

Now we have some dude injecting inflation as we sit here; inflation like never seen before. This dude and his peacock posse are going to run debt which is more than the combined presidents since BOT.


9 posted on 04/17/2009 9:11:18 AM PDT by himno hero
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To: MattAMatt

Yes, in part. Along with the Fed, Congresscritters in both parties, Clintoon and his administration, and Obama and his administration.


10 posted on 04/17/2009 9:21:37 AM PDT by DaisyCutter
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To: MattAMatt

Only up to a point...the actions of the ‘Zero’ administration has made this worse ten-fold.


11 posted on 04/17/2009 9:27:18 AM PDT by FlashBack ('0'bama: "Katrina on a Global Level")
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To: djl_sa

Bush got NCLB and prescription drug benefits. Bush vetoed only 12 bills in 8 years. (Reagan vetoed 8)
Bush pushed TARP 1. Bush pushed illegal alien amnesty TWICE!
Tell me honestly, how much do you think illegal immigration has cost us?
This collapse began before the election. Bush III (McCain) likely still would have won were it not for the collapse.


12 posted on 04/17/2009 9:43:03 AM PDT by cybervyk
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To: All

There are four KEY reasons why we are in the boat we are today (according to Mark Levin’s brilliant explanation in his book “Liberty and Tyranny”):

1.) Community Reinvestment Act (CRA)
*****************
This was implemented by a liberal Democrat controlled Congress in conjunction with a liberal Democrat president to ostensibly combat “red lining”, the purported practice of denying people loans on the basis of their race or ethnicity. In 1989, under President GHW Bush and a Democrat Congress, the recording of race data became a requirement on mortgage applications (I think it was the Federal Home Disclosure Act (FHDA ). In 1992, the Boston Federal Reserve did a study and found what they alleged was widespread racism in lending. This study was subsequently debunked by independent researchers who found profound errors such as the inclusion of mortgage rates with negative values that significantly skewed the data. This study was used as is by the Clinton Administration to justify regulations implemented by the Clinton Justice Department in 1995 that applied “grades” to lending institutions that supposedly reflected the “inherent racism” in their lending processes. These regulations also opened up avenues for groups like Neighborhood Association Coalition (NAC), ACORN and the Rainbow Coalition to petition regulators to deny lending institutions the right to acquire other institutions, merge with them, or expand their facilities or branches. Basically, it opened them up to the same kind of extortion that Jesse Jackson’s group has been subjecting corporations to for years, except that in this case, it wasn’t just public opinion they were using to extort, it was the power of the government to restrict business operations.

2.) Freddie Mac and Fannie Mae getting a government mandate to securitize sub-prime mortgages.
*****************
In 1993 (I think) the government mandated that Freddie Mac and Fannie Mae had to buy up these sub-prime loans. It did this for two reasons that seem mutually exclusive: to reduce the risk of the loans, and also to make more money available to people for these risky loans. Basically, they were giving loans away to people who had no business to get a mortgage. Many of them had NO lending history or BAD history, had no collateral, were not obliged to make any down payments. These loans amount to over 4.5 TRILLION DOLLARS. This is ALL the doing of liberals and the Democrat party.

3.) The explosion of derivatives in the sub-prime market.
*****************
As this was explained, a derivative is basically someone purchasing the risk on a loan in return for payments of some kind. It is a form of investment which in this type of market was EXTREMELY risky. But with the environment where the people responsible for making money saw this as a viable investment option. (Those of you out there who understand this, please pipe in and explain it, because I think I understand it imperfectly here)

4.) The Federal Reserve’s excessive meddling with the interest rates beginning in 2001.
*****************
The problem here was that the Federal Reserve’s excessive intrusion removed market forces from playing an appropriate role in the regulation of interest rates, and kept them abnormally low when they should not have been.

Of all of these, President Bush has *some* culpability on the Federal Reserve’s meddling. Not all, but there is responsibility there.

With all due respect to Mark Levin, I would include another two factors here:]

5.) Energy Policies.
*****************
Liberal energy policies drove energy prices on commodities such as gasoline to more than $4 a gallon. Many of these people who had no business being a homeowner found themselves in a position where energy prices were driving the cost of everything through the roof, and they couldn’t make ends meet. It is their own responsibility they ended up in that situation, but I firmly believe this was part of the liberal’s goals. After all, Saul Alinsky who is a demi-God to people like Obama and Hillary, makes the case that you have to make people angry and hurt in order to get them on your side. It was the job of liberals to exacerbate the situation and make it as bad as possible. And many so-called “conservatives” played right along with them.

6.) Democrat meddling and cover ups of financial monkey business.
*****************
Liberals inhabit nearly all the top fiscal positions in government, and were the vast majority of the recipients of campaign contributions from troubled institutions. Republicans got money too, but nowhere in the numbers taken in by liberals such as Obama, Dodd and Frank. In addition, Freddie Mac and Fannie Mae have been like a candy store for people like Franklin Delano Raines and Jamie Gorelick who made tens of millions of dollars cooking the books and falsifying paperwork with offenses such as backdating in order to kick in those bonuses. There is no outrage about this. And even while Republicans were trying to issue tocsin after tocsin, people like Frank, Dodd and others in the Democrat party were assuring everyone there was no problem. I fault Bush and other Republicans for NOT making an even BIGGER deal than they did out of this. The guy who ran the government oversight committee was castigated by Maxine Waters (I think it was her) as a racist for pointing out these issues at a hearing.

So, yes. Bush and Republicans DO have some blame. But this is a DEMOCRAT CAUSED CATASTROPHE. Most Americans simply don’t know this, the media won’t say so, and neither will Republicans.


13 posted on 04/17/2009 9:45:32 AM PDT by rlmorel ("The Road to Serfdom" by F.A.Hayek - Read it...today.)
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To: SQUID

What? I meerly was saying that it cannot all be blamed on Bush. I also said that Bush made his share of mistakes. Did I not? I have one word for you. Klonipine.


14 posted on 04/17/2009 9:55:00 AM PDT by MattAMatt
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To: rlmorel

No doubt about it. Our government is to blame. I was just growing tired of hearing “O” blame Bush for the dilema.


15 posted on 04/17/2009 9:56:31 AM PDT by MattAMatt
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To: MattAMatt

Well, everyone knew he was going to do that. No surprise there.

What enrages me is this declassification and publication of documents from the Bush Administration. It is PURELY politically driven, and is damaging to our national security, not to mention the people who were on the front lines protecting our sorry asses.


16 posted on 04/17/2009 9:59:15 AM PDT by rlmorel ("The Road to Serfdom" by F.A.Hayek - Read it...today.)
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To: rlmorel

you should’ve known he would do that too. Clinton did the same thing to Reagan & Bush senior


17 posted on 04/17/2009 10:06:05 AM PDT by MattAMatt
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To: rlmorel

Not to mention that “O” does this after he has the military shoot 3 somali teenagers in the head!


18 posted on 04/17/2009 10:07:30 AM PDT by MattAMatt
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To: MattAMatt

I admit I didn’t see them following through on that, even though they threatened it. Often times adults say things, then when they see what is really going on, they silently acquiesce and continue onwards doing what they were doing.

Of course, liberals are not adults, and that approach also requires maturity and introspection, something liberals are missing in spades.


19 posted on 04/17/2009 10:09:49 AM PDT by rlmorel ("The Road to Serfdom" by F.A.Hayek - Read it...today.)
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To: himno hero

Agreed.


20 posted on 04/17/2009 10:13:58 AM PDT by SQUID
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