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Romney Must Explain: Bush Didn’t Cause the Recession

by Keith Koffler on September 24, 2012, 6:20 am

I wanted to flag for you this opinion piece I wrote, “Time for Romney to Defend Bush,” which is running in Politico today.

The idea is that Romney can’t really promote conservative polices until he can defend himself from the Obama charge that he would just wreck the economy like Bush did.

And he can only do this by making the point, which he should have made long ago, that BUSH DIDN’T WRECK THE ECONOMY. The Great Recession was created by liberal housing polices that put people in homes who couldn’t afford them, leading to the subprime crisis.

From the article:

Cowering in their Boston bunkers, fearful of being instantly turned to stone should they touch anything having to do with former President George W. Bush, the Romney team has failed to counter the White House storyline that Bush policies caused the massive recession Obama faced when he took office . . .

Romney should long ago have seized upon one viewpoint, making the well-documented, widely believed case that what caused the Great Recession was interference in markets driven largely by liberals in Congress and the Clinton administration.

The root of the crisis, as New York Times reporter Gretchen Morgenson and mortgage and housing expert Joshua Rosner described in their book “Reckless Endangerment,” is not the top marginal tax rate, but the misguided effort begun during the Clinton administration to increase home ownership among low wage earners.

Yes, the same Clinton who revved Democrats into a frenzy at the convention in Charlotte. I hope you have a moment to take a look at the piece.

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{ 38 comments }

RickW September 24, 2012 at 6:37 am

Nice job, Keith. IMHO, the housing piece was only part of the 1990′s collapse of fiscal sanity. Amazon was formed and, with nominal brick and mortar assets, was suddenly capitalized at almost the value of General Motors. Brokers and bankers were out for a quick buck and the Government let them run wild. Strategic thinking, long term planning went in the trash heap replaced by a “What can we do to juice the earnings for this quarter?” And, as your article points out, who presided over this fiasco? William Jefferson Clinton.

Lets hope Romney grows a pair and has the guts to remind people about the FACTS.

Just2old September 24, 2012 at 6:50 am

And wasn’t it clinton who deregulated the banking industry which allowed the sub-prime mess?

RickW September 24, 2012 at 7:39 am

Yup. He couldn’t get enough campaign contributions from Buddhist monks and Chinese generals, so he needed the banking industry to support him too, Just.

Langley Spook September 24, 2012 at 7:39 am

Clinton & the corrupt Democrats allowing poor people to spend beyond their means and get houses they cant afford… THAT’S RACIST!

FLDemFem September 24, 2012 at 9:32 am

Actually, that was Obama. He sued on behalf of ACORN to make banks lend money to people who weren’t qualified for loans. The people weren’t qualified because they didn’t earn enough to pay the mortgage payments. Obama sued to make the banks lend to these people which resulted in lots of defaulted mortgages and bankruptcies.

OldTimer September 24, 2012 at 7:46 am

Keith, an excellent article. You are right on mark. For me, I’d like to see Romney get tougher. The roots of the housing mess was started in 1977 under Jimmy Carter when the Community Reinvestment Act was passed. The purpose was to reduce redlining so low income could afford credit. In 1995 Clinton expanded and increased the effort to expand the program. ACORN began to get very active during this time.

In 1999 Clinton along with three Republican Senators got the Gramm-Leach-Bliley Act which deregulated banking.

Also, Bush wanted to reform Freddie Mac and Fanny Mae but could not get support from the Democrats. .

Plus China was buying tons of US Treasuries which flooded the system with lots of dollars looking for a home to be invested. It kept interest rates low.

I am in the camp that we are in the soup today more due to Clinton than anyone else.

cincycinco September 24, 2012 at 8:36 am

No!

Clinton – GOOD!

Bush – BAD!

Obama – YES WE CAN!

You’re obviously a racist if you believe otherwise, and you will have to be placed in a FEMA concentration camp after the election – when there’s more “flexibility” – to get you re-educated.

http://www.americanthinker.com/2012/01/new_nationwide_fema_camps_should_raise_eyebrows.html

If you refuse, you’ll be shot with hollow points purchased by Social Security.

http://www.wrcbtv.com/story/19448831/social-security

So, get your mind right, put your head down, and vote Obama – or the consequences will be dire!

Girly1 September 24, 2012 at 8:23 am

Obama certainly did his share to contribute to the housing crash. In 1995 he led the landmark lawsuit against CitiBank to force them to give subprime loans to Chicago’s Af/Ams. Out of 186 borrowers, half went into foreclosure/bankruptcy, while only 19 remained in their homes and maintained a good credit history:

http://dailycaller.com/2012/09/03/with-landmark-lawsuit-barack-obama-pushed-banks-to-give-subprime-loans-to-chicagos-african-americans/

George W, Bush warned Congress 17 times in 2008 alone re regulating Fannie Mae/Freddie Mac. He was derailed by Dodd/Frank:

http://nicedeb.wordpress.com/2008/09/21/the-white-house-warned-congress-about-fannie-mae-freddie-mac-17-times-in-2008-alone/

In July 2008, Chuck Schumer shouted ‘Fire” in a crowded theater causing massive money-run at IndyMac in Pasadena – resulting in second largest bank failure in U.S. history. Rumors abound that it was a deliberate attempt to derail the McCain campaign.

http://latimesblogs.latimes.com/money_co/2008/07/sen-chuck-schum.html

PJ September 24, 2012 at 8:48 am

Every time Obama or one of his surrogates starts going on about what he “inherited,” I would point out that he was PART of the problem as a U.S Senator for four years. He pretends that he came in as an outsider and gets away with it. I would ask what he did to try to prevent the financial meltdown. When he tries to deny any responsibility, I would hit him with the fact that he was too busy running for higher office than to do the job he was elected for by Illinois voters.

FLDemFem September 24, 2012 at 9:39 am

Yes, he had been a Senator for 143 days when he decided that he was qualified to run for President. Interestingly, this decision came a few days after the news broke that the Clintons were worth $100 million, due to their books, speaking fees and good investments. The Obamas saw dollar signs and jumped into the race. Also, before announcing this year’s run, they had a study done that showed that two term presidents earn 3 times as much post-presidency than one termers. It’s not about public service for the Obamas, it’s all about money and how much they can get for themselves.

Girly1 September 24, 2012 at 10:22 am

Excellent point. He never misses the opportunity to remind the world that he is a one-percenter – typical of the nouveau riche. How many times have we heard him say: “Millionaires and billionaires – like myself”! Byron York wrote an article for National Review before the election, “What is a Community Organizer?”. In it, he describes how Obama said he only went to Harvard in order to learn how to achieve POWER. Along with power comes $$$. He managed to make a fortune with a couple of ‘autobiographies’. Who in the heck would dream of writing an autobiography in their 20′s??? Obama is nothing but a cheap hustler!

Melvin September 24, 2012 at 9:00 am

Exactly! This issue has driven me crazy for a long time!

Susan September 24, 2012 at 10:09 am

Guess I’m the odd man out on this issue. Agree Bush didn’t cause the housing crisis, but he did allow the Democrat-controlled Congress to spend like drunken sailors the last two years of his presidency. His idea of “compassionate conservatism” meant expansion or creation of big government social welfare programs (i.e., No Child Left Behind) that have cost our economy greatly.

In my opinion, Romney has a good message, and he shouldn’t try to become a Bush apologist. We can’t do anything about the past, so best to look toward the future. I want Romney/Ryan to tell us the hard truths and their plans to restore our Republic, and I want them to do it with the fire in the belly passion I’ve seen in them both.

Girly1 September 24, 2012 at 11:25 am

I agree, Susan. Bush is still the third rail of politics. Obama is so wont to blame the ‘mess he inherited’ on Bush, it would behoove Romney to be prepared with a short zinger should the topic arise in the debates. All he has to say is something to the effect that both sides contributed to the mess, including Sen. Obama himself, i.e. the CRA, Fannie & Freddie, mortgage discrimination lawsuits, sub-prime loans for Af/Ams, etc. This all should have been argued 4 years ago, but everyone is afraid of the “R” word.

gracepmc September 24, 2012 at 12:15 pm

I agree with Susan and Girly1. The mere mention of Bush automatically announces open season for even more lies for the Obama team. The point you make Keith is a solid one. But politically I think it’s a fail for Romney. These guys lie about him before their feet even hit the floor in the morning. Truth and facts are not in play for Team Obama. And if CBS had not edited Obama’s admission of some “mistakes” in his ads more of America would see this.

cincycinco September 24, 2012 at 12:38 pm

If Obama gets a second term, will he still blame the “mess he inherited” on the previous administration?

He’s so dysfunctional anyway, it wouldn’t be surprising if he were schizophrenic as well.

Radegunda September 24, 2012 at 4:36 pm

Romney doesn’t need to be a “Bush apologist.” He just needs to be a Democrat-critic. Since so many people believe that “Republican policies caused this mess,” and therefore believe that Romney=Republican=more of the mess, he needs to explain why that’s wrong.

Romney needs to say “Here’s how Democrats forced subprime loans on banks. And here’s how Democrats prevented the efforts to fix the problem.” He doesn’t even need to say “Bush’s efforts.” Show how much moolah went to Obama and Dodd for sheltering Fannie/Freddie. Play a soundbite of Artur Davis apologizing for the mistake he made in shielding Fannie/Freddie.

It’s crucial to break the “Republicans wrecked the economy” myth!

Julie Brueckheimer September 24, 2012 at 10:16 am

Two excellent posts, this and the one above on Obama’s comments on Israel. I’ve given up on Politico, but I have to go read your entire post, and, Politico, believe-it-or-not, has a battleground poll out which shows Romney with a fourteen point lead among “middle class’ voters.

Nemisis September 24, 2012 at 4:45 pm

That 14 point lead should double now that Romney has said he will have to raise taxes on the middle class if he wins.

Shofar September 24, 2012 at 10:25 am

I was doing some research on homelessness in America, and came across some interesting stats.

“According to U.S. Department of Housing and Urban Development’s Point In Time (PIT) data, the number of persons in families experiencing homelessness increased slightly between 2009 and 2010, after a 25 percent decrease between 2005 and 2009.” (http://www.usich.gov/usich_resources/fact_sheets/opening_doors_homelessness_among_families_fact_sheet/)

The US Interagency Council on Homelessness is trying to tie the economic downturn and homelessness together, and there is a causal affect, the home bust being the biggest. However, they are also now stating that a person is homeless if they are living with family or friends. The ploy being that everyone needs to be re-housed into some form of single family dwelling.

From the web site: The Recovery Act investment of $1.5 billion in HUD’s Homelessness Prevention and Rapid Re-Housing Program (HPRP) has been one of the most significant success stories, giving communities needed funding during the economic downturn to stem the rising tide of family homelessness. From the program’s inception in late 2009 through May 2011, over 1 million people have received assistance under the program in the form of prevention or rapid re-housing assistance with case management or short-term financial resources. Overall, nearly 90 percent of program participants exited into permanent housing. Without HPRP, the numbers of families experiencing homelessness on a given night in 2010 would have likely been much higher.”

The site also states, “Faced with limited options, many low-income families double up in households with family or friends.”

The thing that I find troubling is that until WWII, multi-generational households were the norm in America. After WWII, the GI Bill made it possible for more and more families to move out on their own, and we began the great “urban sprawl” that so many progressives complain about. And yet they are “investing” $1.5 billion to get people back into homes. In many cases home people lost due to the Mac twins fiasco.

Homelessness is a serious issue, and no one should be living on the street or having to sleep in their car, but to classify persons as homeless because they have moved back in with family is nothing more than inflating the numbers to so that the government has an excuse to spend more on certain population segments. If an adult child is living with his or her parents, are they classified as homeless? From what I can find on the government’s web site, they would be. Are they? No.

America is slowly slipping back into the format of life that was before WWII. The only difference now is that the government is handing out goodies left and left to keep people blind to the idea that you turn to family first (if you have them), then to the local community (churches, temples, etc.), and lastly to the state.

Ironically, it is the cradle to grave mentality that is causing families to come back together. College grads can’t find jobs because the market is flat or declining. Families have so over extended themselves that they lose everything and have to move back with grandma and grandpa. In many cases families are reconnecting for the first time in years, and while not necessarily ideal, they do have housing. Yet, these are the very same people counted as homeless, and give the administration an excuse to keep spending on housing initiatives.

Rather than spend $1.5 billion on a re-housing scheme, they should be spending that money for the truly chronic homeless, people who need mental health treatment, drug and alcohol counseling, literacy training and more. Not to get someone who bought more house than they can afford back into a house they still can’t afford.

WCC September 24, 2012 at 10:41 am

Yup, The Community Reinvestment Act, AKA the “The Fair Housing Act” was instituted by none other than DEMOCRAT, Jimmy Carter. Clinton added on to it along with Barney Frank and Chris Dodd. Bush tried to warn them, but to deaf ears. And who gets all the blame! Guess that’s how it works in Washington. Only in Washington can you rationalize out right lies as campaigning that is “overboard.”

Star September 24, 2012 at 12:17 pm

I dunno if a big defense of Bush is what we need now–but we do need to boil this down a bit to a 9-9-9 type deal for the people who don’t obsess over this everyday like we do. Maybe RETHINK, REGROUP, RECOVER–ROMNEY RYAN. Or is rethinking too open to flipflop crap? ASSESS-ENACT-ENABLE…something!

Star September 24, 2012 at 1:40 pm

By the way–good WSJ editorial today on the Ryan appearance at AARP–how he was applauded several times while not backing down on tightening entitlements. Of course, this was characterized in the press as a boo-fest. Ryan and Romney, too, better put it out there at this point–you like it, you hate it, you can’t tell because you don’t care or are not very good at critical thinking–what, people? They need to just go for it.

RT Boogs September 24, 2012 at 2:09 pm

Another round of pin the tail on the donkey. Why not. Nothing else seems to be working. Too little too late. Reboot, defrag, insert, and delete. The near final death throes of a campaign gone wrong.

Star September 24, 2012 at 2:54 pm

Stupid Stupid Stupid. Wait, did I type that out loud? LOL.

RT Boogs September 25, 2012 at 10:49 am

Self reflection can be a bitch Star. Lol…

barkley pontree September 24, 2012 at 3:23 pm

Weird, I just wrote a blog last week where I told Bill Clinton to shut up, the crash variables can be traced to him. Clinton is the one that signed all the free trade things like NAFTA that produced the giant sucking sound of jobs in manufacturing, technology, and customer service out of this country. Clinton is the one that signed the repeal of Glass Steagall which protected the banking/investment industry for 60 years and with the repeal it took less than 10 years for the whole thing to collapse. And Clinton is the one that started the mortgages to people who shouldn’t be getting mortgages.

But do you really think Romney could sell this? Are most Americans bright enough to do a little root cause analysis and understand the cause and effect train? I don’t think so, especially in a media that is so designed to hammer anything conservative and promote everything liberal.

But we do appreciate the fact you try, Keith.

barkleypontree.blogspot.com

Nemisis September 24, 2012 at 3:59 pm

Girly1 you are so misinformed and confused.
I’ll try to be brief, clear & concise.

NY Times – September 11, 2003 – The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Bill H.R.1461 was introduced in the house on 4/5/2005
Passed the house with a vote of 331-90 on 10/26/2005
Then it was referred to the House Financial Services Committee who overwhelmingly voted to approve the bill 65 – 5.

http://thomas.loc.gov/cgi-bin/bdquery/z?d109:HR01461:@@@R

Then Bush stepped in and killed the bill before it made it to the senate.

Why is it that you don’t know this information Girly1?

If you want to see the WH press release from Bush’s office let me know and I will try to post it in here.

OldTimer read the bill, there was bipartisan support from the Democrats as evidenced by the vote.
Your information is not correct on this point.

Girly1 September 24, 2012 at 5:33 pm

Nemisis, HR1461 was deficient. The House punted on the Administration’s original intent.

REGULATING FANNIE MAE AND FREDDIE MAC
September 2005

The GSE regulatory reform bill reported out of the Senate Banking Committee in July 2005 included a provision that would virtually eliminate the authority of Fannie Mae and Freddie Mac to acquire and maintain portfolios of mortgages and mortgage-backed securities. If this provision becomes law, it will sharply reduce the risks associated with the GSEs, as well as their profitability. The conventional wisdom in Washington and on Wall Street is that a bill this controversial, adopted on a party-line vote, will quickly die in the Senate, and that tough restrictions on the GSEs’ portfolios will not become law. But this view fails to reckon with the determination of the White House–demonstrated over several years–to limit the risks that Fannie and Freddie create for both the taxpayers and the economy.

In the last essay that dealt with the regulation of Fannie Mae and Freddie Mac (“Regulating Fannie Mae and Freddie Mac,” May 2005),[1] we noted that the only legislation then under consideration in Congress was a deficient bill that emerged from the House Financial Services Committee in April 2005. When that committee acted, its members had before them a proposal from the administration that would have placed significant limitations on the size of the mortgage port-folios that Fannie Mae and Freddie Mac would be permitted to accumulate. Had this provision been adopted, it would have virtually eliminated the risk that these government sponsored enterprises (GSEs) create for the taxpayers and the economy. But the committee punted. Its bill, HR 1461, failed to provide the necessary authority for the new GSE regulator to limit or reduce the GSEs’ portfolios, which at that point amounted to approximately $1.5 trillion.

READ MORE:

http://whatqmark.blogspot.com/2009/11/barney-frank-regulation-of-fannie-mae.html

S90 FANNIE/FREDDUE REGULATIONS – Defeated by DEMS

http://randallparker.blogspot.com/2008/10/fannie-freddie-regulations-cox.html

Girly1 September 24, 2012 at 5:50 pm

Nemisis, I provided the wrong link above. Please refer to:

REGULATING FANNIE MAE AND FREDDIE MAC

http://www.aei.org/article/economics/financial-services/regulating-fannie-mae-and-freddie-mac/

Girly1 September 24, 2012 at 4:15 pm

Last night Obama told Steve Kroft – “I am a night person. Everyone else is in bed by 10:00.’ So what do you do after 10:00, Mr. (p)resident? ‘Well, between 10:00 and let’s say 1:00, I write a little, read a litte, and sit out on the balcony looking at the Washington Memorial and the Lincoln Memorial…and reflect’. Translation: Chooming and smoking….

As reported in Glamour magazine, MO almost divoced this lazy bum because he slept til noon, and refused to seek gainful employment at a prestigious law firm We know that he doesn’t do a darn thing all day except photo ops. He doesn’t even try to disguise the fact that he does nothing all day. He hitched his wagon to the govt. because 1.) he is lazy; 2.) he gets paid for doing nothing; and 3.) he’s a con artist!

How ‘hard’ is it to blow $5T in four years on your friends? How hard is it to govern by ‘giveaway’?

This election should be about ‘Anyone But Obama’! Obama is a bump on a log! Benghazi should be the final nail in his coffin – what else is it going to take? Calling an Al Qaeda attack on Benghazi a ‘bump in the road’ should be his epitaph! He should be brought up on dereliction of duty – followed by impeachment! What can we do? Civil disobedience? How do we stop this madman? Romney is a flea on an elephant’s back – Obama is the 800 pound gorilla in the room – he needs to be physically removed!
(end of rant/)

Star September 24, 2012 at 4:33 pm

I see News Corp is down $1.5 billion–not even in top 25 media companies….From trending left, do you think?

Star September 24, 2012 at 4:38 pm

Also…another road bump?
http://www.google.com/hostednews/ap/article/ALeqM5jFOoGGOTCvn2I0mPYd8Y2b3d5s2Q?docId=a8fdd96b8d5b4d38b916954c0374d52c

Some weird disease. I noticed because I have some weird disease, although I think the meds are now attacking me…

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