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The Untold Story Of How Clinton's Budget Destroyed The American Economy
Business Insider ^ | 09/05/2012 | Joe Weisenthal

Posted on 09/05/2012 8:06:09 AM PDT by SeekAndFind

Bill Clinton is giving the keynote speech at the Democratic National Convention tonight.

The idea is to make people feel nostalgic for the last time when the economy was really booming, and hope that some of that rubs off on Obama.

However, in the New York Post, Charlie Gasparino uses the occasion to remind everyone that the seeds of our current economic malaise were planted during the Clinton years. Basically, it was under Clinton that Fannie and Freddie really began blowing the housing bubble, issuing epic amounts of mortgage-backed debt.

The story that Gasparino tells is basically: Liberal Bill Clinton thought he could use government to make everyone a homeowner and so naturally this ended in disaster.

Gasparino specifically cites the controversial Community Reinvestment Act, a popular conservative bogeyman:

How did they do this? Through rigorous enforcement of housing mandates such as the Community Reinvestment Act, and by prodding mortgage giants Fannie Mae and Freddie Mac to make loans to people with lower credit scores (and to buy loans that had been made by banks and, later, “innovators” like Countrywide).

The Housing Department was Fannie and Freddie’s top regulator — and under Cuomo the mortgage giants were forced to start ramping up programs to issue more subprime loans to the riskiest of borrowers.

(Excerpt) Read more at businessinsider.com ...


TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: billclinton; clinton

1 posted on 09/05/2012 8:06:14 AM PDT by SeekAndFind
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To: SeekAndFind

Just this morning, Bill Clinton made the sun come up.


2 posted on 09/05/2012 8:13:16 AM PDT by blueunicorn6 ("A crack shot and a good dancer")
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To: blueunicorn6

But last night, when it went down - that was Bush’s fault.


3 posted on 09/05/2012 8:15:58 AM PDT by DuncanWaring (The Lord uses the good ones; the bad ones use the Lord.)
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To: SeekAndFind
Clinton had a Republican Congress, so they share the blame as well, for letting Clinton smooth talk them into it. Gasparino specifically cites the controversial Community Reinvestment Act, a popular conservative bogeyman

Twern't no boogeyman. They gave money away to people who couldn't pay it back. If the issue was red-lining and racial discrimination, then that is the issue that should have been addressed. But liberals (both on the Left and the Right) attack the symptoms, not the root problems, and always end up making the problem worse

4 posted on 09/05/2012 8:16:37 AM PDT by Clock King
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To: SeekAndFind

Is’nt there a football game on tonight?...FUBC and FUBO!


5 posted on 09/05/2012 8:20:11 AM PDT by AngelesCrestHighway
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To: SeekAndFind

Don’t forget a certain community organizer who sued Citibank in a large city at the southern tip of Lake Michigan to force them to loan money to people who had no hope of ever paying it back.


6 posted on 09/05/2012 8:21:17 AM PDT by DuncanWaring (The Lord uses the good ones; the bad ones use the Lord.)
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To: SeekAndFind
I thought NAFTA was probably the biggest thing Clinton did to destroy America's prosperity. They do mention in the article that Clinton presided over a huge trade deficit, but unfortunately fail to mention that something like 90% of American business left the U.S to do their business in other countries after NAFTA. Please correct me if I'm wrong, but isn't the NAFTA Disasta a bigger bite out of the economy?
7 posted on 09/05/2012 8:26:30 AM PDT by Missouri gal
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To: SeekAndFind
Screw the flake ass democratic convention!...
8 posted on 09/05/2012 8:26:39 AM PDT by AngelesCrestHighway
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To: SeekAndFind

The Community Reinvestment Act was only one of the factors, the removal of the Glass–Steagall Act of 1933 that limited commercial bank securities activities and affiliations between commercial banks and securities firms was another. Repealed under Clinton in 1999, it allowed Insurance Companies, Banks, and Wall Street to all get into the same business. The Bad Mortgages by themselves were harmfull, but the sliced and diced bad mortgages sold as AAA rated securities found there way into everybodies balance sheet, that’s what really spread pain far and wide.


9 posted on 09/05/2012 8:27:11 AM PDT by swamprebel (a Constitution once changed from Freedom, can never be restored.)
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To: swamprebel

You are absolutely correct. You win post of the month.


10 posted on 09/05/2012 8:29:30 AM PDT by bmwcyle (Corollary - Electing the same person over and over and expecting a different outcome is insanity)
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To: SeekAndFind

Unfortunately I’m afraid it’s too late to sell this story. These facts were known in 2008 but the Repubs allowed themselves and Bush to be blamed for the economic collapse. Now after 4 years and thousands of news stories it is considered common knowledge of who was to blame. Changing that perception is going to be very difficult. It certainly needs to be done but the time to do it was years ago.


11 posted on 09/05/2012 8:32:57 AM PDT by Brooklyn Attitude (Why can't life be more like beer commercials?)
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To: swamprebel

Re post 9:

The CRA provided a source of bad mortgages, and an example to everyone else. Eliminating Glass-Steagall let those bad mortgages be securitized and drained away, making room for new ones.

It was a deadly combination!

By the way, it looks like O and his crowd are trying to do the same thing all over via the FHA, which will write mortgages with only 3.5% down. That’s less than the broker’s fee, so the house is immediately underwater. It’s only been a few years, but the default rate is starting to climb already.


12 posted on 09/05/2012 8:33:58 AM PDT by Pearls Before Swine
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To: swamprebel

Phil Gramm was the Republican leader who pushed through Glass-Steagall.

Gramm, a PhD in Economics, was convinced that US banks could be more competitive if the restrictions of Glass-Steagall were removed. Sounded so good.

Economically, it sounded so good. But as brilliant as Gramm was in understanding economic theory, he was a dunce when it came to understanding the human nature side of the equation. He let the millions of bats out of the cave.


13 posted on 09/05/2012 8:39:07 AM PDT by Hostage (Be Breitbart!)
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To: SeekAndFind

It goes against the grain to believe Charlie’s analysis. Government is a disrupter. In a well ordered capitalist economy, stable corporations would issue stable paper for savers and a balanced government budget would issue (and redeem) some paper now and again to smooth out funding of capital requirements..


14 posted on 09/05/2012 8:39:57 AM PDT by I am Richard Brandon
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To: swamprebel
the removal of the Glass–Steagall Act of 1933 that limited commercial bank securities activities and affiliations between commercial banks and securities firms was another. Repealed under Clinton in 1999, it allowed Insurance Companies, Banks, and Wall Street to all get into the same business.

Glass-Steagall was Rooseveltian fascism, and was rightly repealed. It was a typical Lefty way of protecting certain companies from competition while claiming you were keeping evil capitalists under control. The problem was Clinton's housing fascism, with Baby Cuomo giving speeches threatening to jail bankers who wouldn't lend to deadbeats—creating monopoly-money loans that were taxpayer-guaranteed. I'm guessing Clinton's suppport for dumping Glass-Steagall was to pay off his contributors on Wall Street who were eager to trade the worthless sub-prime mortgages he was creating.

15 posted on 09/05/2012 8:42:31 AM PDT by SamuraiScot
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To: SeekAndFind
Clinton doesn't get enough credit for sowing the seeds of 9-11 either. Similarly what Obama’s sowing now won't be revealed till after he's gone.
16 posted on 09/05/2012 8:45:45 AM PDT by throwback (The object of opening the mind, is as of opening the mouth, is to shut it again on something solid.)
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To: SeekAndFind

This is my third time harping on this! Please, please will someone contact the RNC and tell them to make a video about this subject to run in Virginia? All weekend long sleazy bill was on the tube ranting about how great his term was for economy and how if just given a little more time the o would be just as successful. BS, BS, BS.


17 posted on 09/05/2012 8:46:30 AM PDT by Portcall24
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To: SeekAndFind

It should read “ How Reagans economics help Clinton ride through 8 years of prosperity. Until he got what he wanted and ruined the Economy”.


18 posted on 09/05/2012 8:55:24 AM PDT by crazydad (-` sd)
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To: SeekAndFind
.

"However, in the New York Post, Charlie Gasparino uses the occasion to remind everyone that the seeds of our current economic malaise were planted during the Clinton years."


That is exactly what happened.

.

19 posted on 09/05/2012 8:58:02 AM PDT by Jackie
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To: Hostage

Gram’s bill passed the US Senate strictly on party lines, no Dem voted for it and Clinton threatened to veto it. It was during the House and Senate reconciliation committee that the la.guage that did the damage was put in.

The bill then passed the Senate 92-8


20 posted on 09/05/2012 8:58:56 AM PDT by South Dakota (shut up and drill)
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To: Hostage

Niall Ferguson has made the good point that economists are beguiled by mathematical models and are unable to factor in properly the historical and social elements that go into an economy. Gramm knew what he knew. He tried to use a tool that was not equal to the task.


21 posted on 09/05/2012 9:10:16 AM PDT by RobbyS (Christus rex.)
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To: throwback

If we ever had a media with honesty and integrity Clinton would have been a 1 term President due to many factors. He would never have been President for one. When he was running the lie that was told enough what the Economy Stupid. Well GHW Bush had a 5% growth in the economy but the Media felt it was doing its masters work by taking down their mortal enemy the Republicans. Well Clinton was lucky he got a economy that was not his. He got what Reagan started. They always made fun of Trickle down economics but if you look at it. It was Reagans policies with taxes that made it possible for Clinton to say Look at my economy. Well again the media never mentions Newt and the 104th congress in their propaganda. Man I hate the media.


22 posted on 09/05/2012 9:11:11 AM PDT by crazydad (-` sd)
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To: Clock King
Clinton had a Republican Congress, so they share the blame as well,

Several years ago I looked this up and the expanded CRA took effect in Jan 1995. It was expanded and took effect just before/as the Republicans were seated in the House. They never voted on the expansion.

23 posted on 09/05/2012 9:20:11 AM PDT by DJ MacWoW (My faith and politics cannot be separated)
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To: SamuraiScot

“Glass-Steagall was Rooseveltian fascism, and was rightly repealed.”

Unfortunately, you have FDIC and FSLIC. As long as the public is insuring bank deposits, bankers can’t be allowed to speculate wildly with that money. That results in the worst of crony capitalism. If the speculation pays off, the banks get the benefits. If it crashes, the public pays the losses.

If you eliminate Glass, you also have to eliminate FDIC and FSLIC insurance.


24 posted on 09/05/2012 9:29:54 AM PDT by ModelBreaker
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To: Clock King
And IIRC, it was jimeh cahtah that initiated the CRA in the first place.

My personal thought, with nothing to prove I'm right is ... he was setting himself up for ex-president, and that habitat for humanity scam.

25 posted on 09/05/2012 9:52:02 AM PDT by knarf (I say things that are true ... I have no proof ... but they're true)
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To: DJ MacWoW
Several years ago I looked this up and the expanded CRA took effect in Jan 1995. It was expanded and took effect just before/as the Republicans were seated in the House. They never voted on the expansion.

If the Republican members of congress bear any blame, it's for not succeeding in their attempts to roll back this mess during Bush 43's administration. After the Dems regained control, that opportunity vanished. But at least they *did* try to fix it before the problem reached critical mass.

I'm sure the roll call on those votes would show the usual back-stabbers like McCain helping the Marxists.

26 posted on 09/05/2012 10:18:31 AM PDT by Charles Martel (Endeavor to persevere...)
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To: ModelBreaker
If you eliminate Glass, you also have to eliminate FDIC and FSLIC insurance.

Agreed. Government guarantees are an illusory form of security. (If the markets go, what will hold up the government's assets? Barleycorns?) Since when did governments become trustworthy with other people's money? The're just ordinary folks watching over stuff that isn't theirs. They're not going to do as careful a job as people do with their own property.

27 posted on 09/05/2012 10:26:29 AM PDT by SamuraiScot
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To: knarf
And IIRC, it was jimeh cahtah that initiated the CRA in the first place.

My personal thought, with nothing to prove I'm right is ... he was setting himself up for ex-president, and that habitat for humanity scam.

Yes, Carter signed the CRA into law. As for the rest, I think it's more a case of the left's relentless legislative assault. They're willing to put *something* in the law books, even if it seems innocuous or non-threatening.... the sort of "throwaway" bills that generate no heavy opposition.

And then they come back a dozen years later and amend it, usually by attaching the amendment to some unrelated bill. They know how to game the system, it's as simple as that.

28 posted on 09/05/2012 10:31:24 AM PDT by Charles Martel (Endeavor to persevere...)
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To: Brooklyn Attitude
exact reason the liberal MSM’s chain needs to be yanked. It is the democrat's propaganda machine so there is no way they were going to taught an issue that was clearly spawn from democrat corruption, then or now.
29 posted on 09/05/2012 10:41:23 AM PDT by drypowder
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To: Charles Martel

Surprisingly both McCain and Bush tried to rein in Fannie and Freddie. McCain introduced legislation in 2005 but it was defeated.


30 posted on 09/05/2012 10:44:05 AM PDT by DJ MacWoW (My faith and politics cannot be separated)
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To: Charles Martel
I went searching for the bill sponsored by McCain and stumbled on a Republican website that linked to...........Ta Da!,... FR. LOL

http://www.wash-gop.com/node/197

31 posted on 09/05/2012 10:47:21 AM PDT by DJ MacWoW (My faith and politics cannot be separated)
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To: Charles Martel
If the Republican members of congress bear any blame, it's for not succeeding in their attempts to roll back this mess during Bush 43's administration

Problem is...that would be like the Repubs saying now they would roll back Social Security.

Sure, it's something that should be done at some point but all kinds of charges would be leveled insuring that the Repubs would lose seats meaning the thing would NEVER be dealt with.

Easy with 20/20 to say they should have done it, but at the time it would have been committing political suicide and would have imperilled the War AND the economy way more than it was.

32 posted on 09/05/2012 2:56:52 PM PDT by what's up
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To: DJ MacWoW

Good point. Thanks.


33 posted on 09/05/2012 7:18:49 PM PDT by Clock King
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To: Clock King

You’re welcome. :-)


34 posted on 09/06/2012 6:59:00 AM PDT by DJ MacWoW (My faith and politics cannot be separated)
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