AP Blames Mortgage Crisis On Bush
In an analysis of the mortgage crisis, the Associated Press blames the collapse on a lack of regulatory crackdown from the Bush administration which was pressured away from regulation by mortgage industry lobbyists in 2005. Because the Bush administration is obviously the only political entity with regulatory authority in this matter. It’s not like Congress has banking committees or anything.
It’s not like certain prominent Democrat members of Congress out-and-out opposed crackdowns on subprime loans even as the Bush administration attempted to increase regulation.
And are we really supposed to believe that this entire problem was created from 2005 on? It seems to me that it took a lot more than 2 - 3 years of subprime loans to bring the market down.
Regardless, the truly interesting thing in this analysis is the way big-players in the mortgage market (such as Countrywide Financial, which bought off members of Congress like Senate Banking Committee Chairman Chris Dodd and Senate Budget Committee Chairman Kent Conrad with “VIP” loans) lobbied to keep making these bad loans. Why on earth would they do that?
Maybe because they knew that the government would keep asking Fannie Mae/Freddie Mac to buy up and/or secure those bad loans, and that if anything really bad happened they’d get a bailout.
