Can You Really Blame Bush for The Economy?

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?

Sources point to Obama as a possible starting point to the domino affect that lead to the housing crises we are now facing. Check the provided links and judge for yourself.

"In a 1995 case known as Buycks-Roberson v. Citibank, Obama and his fellow attorneys charged that Citibank was making too few loans to black applicants, "victimized" by home mortgage lenders, and won the case. As one commentator noted in May 2008, legal "successes" such as this were probably responsible for the sub-prime mortgage crisis of 2007 AND 2008. That is, banks were not loaning to blacks whose credit was poor. When the law forced them to lend money anyway, the inevitable collapse occurred."

Buycks-Roberson v. Citibank Fed. Sav. Bank

Obama’s Early Legal Career: Heavy on Advocacy for Blacks

A trillion here, a trillion there, pretty soon we're talking about real money

Obama had a part in the lawsuit that started the government on a course of forcing lenders to give more loans to those who had poor credit. Lending companies were forced to come up with imaginative ways of fulfilling the quota that was required. Sub-prime lending was born as a result. The mortgage crises was forecast by many who were able to look beyond the quota.

This New York Times article (.pdf) clearly forecast the mortgage meltdown.

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders, ... under increasing pressure from the Clinton Administration.

"Fannie Mae has expanded home ownership for millions of families in the 19902 by reducing ddown payment requirements," said Franklin Raines, Fannie Mae's chairman and chief executive officer. "Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market."

Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to black borrowers, compared to 5 percent of loans in the conventional loan market.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry of the 1980s.

"From the perspective of many people, including me, this is another thrift industry growing up around us," said Peter Wallison, a resident fellow at the American Enterprise Institute. "If they fail, the government will have to step up and bail them out, the way it stepped up and bailed out the thrift industry."

Obama's Community Organizing

You know what? I have to appologize to you. We are both singing the same tune, but in a different way. When I originaly wrote this, it was way too long. In the course of triming it for online posting, I left out quite a few things about Republicans and Government Departments.

I can see how you would feel that I am pointing fingers at one party, but I assure you that I am not. I believe that all parties in our Government are Statists. They are all opportuninists that make power grabs when the citizenry is vulnerable. For as long as I can remember, the two parties have made countless compromises, that go against their own ideologies, to preserve themselves, at the expense of our Liberty and Prosperity (the two go hand in hand).

It is time for us to oust all of them and start anew. We need to elect Patriots who understand what Freedom means, and have the intestinal fortitude to sacrifice themselves to protect our Liberty.

'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?”'

Two things really...

1st: most politicians will use any leverage they can get> If the prevailing wind blowing is one of The President is responsible for "x" most politicians no matter what the party will take the same stance, just ion varying degrees depending if they are in the same party.

2nd: If the Media is all in lockstep promoting a cause/story/template such as: "Bush Policies are a failure" then there is really no point in refuting it on those networks or in those newspapers because those MSM critters will just target those who challenge their template and call them liars etc.

Truth really has no bearing on the issue, if you speak a lie often enough it is accepted as truth. Witness man-made globull warming so many lies spoken over and over it is now accepted as truth by a large portion of the population.

Bush had many successes foreign-policy wise.

But he failed to do anything domestically. Anytime he tried to do anything such as social security reform, it was stalled. He signed off on all legislation from the Congress and pushed more expansive federal government.

Bush did nothing to bring down the size of the federal government and so the past eight years were a wasted opportunity. Obama’s going to exponentially leave grow it and we’ll we be wishing we had those eight years back to downsize and streamline our federal government.

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