Should we blame Bush or Clinton for the rapid decline of our economy?
Unemployment is going up, the deficit is historically unmatched, the housing market if collapsing. It is obviously nothing related to Obama's policies, as liberals believe. So, maybe George H Bush? Maybe George Washington?
- Anonymous10 years agoFavorite Answer
Subprime Mortgage began in 1994
October 23, 1997
(From the Clinton Archives)
In 1994, President Clinton, along with the National Partners in Homeownership, set a goal for the nation to achieve an all-time high homeownership rate by the year 2000. Today -- a full three years early -- the Census Bureau reported that in the third quarter of 1997 the homeownership rate climbed to its highest level ever. Here are some of the results from the Census report, as well as other housing-sector statistics:
--In 1995, at the request of President Clinton, the Administration convened the National Partners in Homeownership to carry out a National Homeownership Strategy
-- The Clinton Administration has cut FHA home mortgage insurance premiums four times
--In 1999, under pressure from the Clinton administration, Fannie Mae, the nation's largest home mortgage underwriter, relaxed credit requirements on the loans it would purchase from other banks and lenders, hoping that easing these restrictions would result in increased loan availability for minority and low-income buyers.
Putting pressure on the GSE's (Government Sponsored Enterprise) Fannie Mae and Freddie Mac, the Clinton administration looked to increase their sub-prime portfolios, including the Department of Housing and Urban Development expressing its interest in the GSE's maintaining a 50% portion of their portfolios in loans to low and moderate-income borrowers.
Fannie Mae Eases Credit To Aid Mortgage Lending
WASHINGTON, Sept. 29, 1999 — 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.
The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans.
***** Fannie Mae officials say they hope to make it a nationwide program by next spring. ***
--BUSH REGULATORY OVERHAUL OF FANNIE/FREDDIE BLOCKED BY DEMOCRATS
New Agency Proposed to Oversee Freddie Mac and Fannie Mae
By STEPHEN LABATON
Published: September 11, 2003
WASHINGTON, Sept. 10— The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.
The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac -- which together have issued more than $1.5 trillion in outstanding debt -- is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors.
--Supporters of the companies said efforts to regulate the lenders tightly under those agencies might diminish their ability to finance loans for lower-income families.
-- ''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''
Representative Melvin L. Watt, Democrat of North Carolina, agreed.
''I don't see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,'' Mr. Watt said.
- SinisterMattLv 510 years ago
Both. And then continue back to at least Nixon. Obama of course also gets some of the blame, as his policies are extending the recession.
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- 10 years ago
There is no "rapid decline of our economy"---the damages from the 2001 through 2008 period took a long slow time to reach their CREST or PEAK, beginning with the price-gouging on gas (over $5 a gallon and fluctuating daily) in 2003 after the ILLEGAL invasion of Iraq that began the severe SHRINKAGE from within the economy. People used up savings and credit cards, maxing them out and thus lowering their credit scores, just to be able to get to and from work---while the oil companies (and the oilmen in the White House) made RECORD quarterly profits which revealed there was a GLUT in supply (the price-gouging was DELIBERATE). The maxed-out credit meant no consumer spending, and this cutback in consumer spending meant stores could not move their goods to make profits, so businesses began cutting hours and laying off workers while simultaneously raising prices to accommodate higher shipping costs and fewer sales---selling even fewer items once prices were raised. More SHRINKAGE from inside the economy. Tourist dollars upon which states rely to meet their budgets fell off drastically---so states began to run huge deficits (California is just one example). Those states with foolish "balanced budget amendments" had to immediately LAY OFF WORKERS and CUT SOCIAL PROGRAMS which further SHRANK these state's and our federal economies, becoming a vicious circle: Layoffs meant less spending which meant more layoffs...and so on... Don't lay the blame on one person (i.e., Bush)---blame the POLICIES of the entire Bush/Cheney/GOP reign of fiscally-unsound terror upon this nation, and then finally finally admit it, Republicans: Supply side economics and DEREGULATIONS do not work! You had proof when the savings and loans collapsed under Reagan/Bush-Bush/Quayle supply-side economics, OUTSOURCING of our manufacturing jobs, and DEREGULATIONS (Bartlett & Steele, 1991), and Democrat Bill Clinton cleaned up that mess, leaving office with a SURPLUS and 2.2 MILLION new jobs (Flynt, 2004). Now you have the GOP/Bush/Cheney war costs (kept off the books but still spent as deficit), unfunded mandates that include the REVENUE-DEPLETING TAX CUTS for the wealthiest 1.5% in 2001 and 2003, collapses of both the housing and credit markets, and then the piece d' resistance for the GOP's errors (Krugman, 2008; Picker, 2009): FINANCIAL SYSTEM MELTDOWN---all of which Democratic President Obama is working night and day to repair.Source(s): Bartlett, Donald & Steele, James (1991), "America, What Went Wrong?" Available on amazon.com. Flynt, Larry (2004), "Sex, Lies & Politics: The Naked Truth." NY: Kensington Press. Krugman, Paul (2008), "The Return of Depression Era Economics and the Crisis of 2008." Available on amazon.com. Picker, Joshua (2009), "Before the Bush Recession: Supply Side Tax Cuts Failed to Deliver on Jobs and Income Growth Between 2001 and 2007." Washington, D.C.: Center for American Progress.
- Anonymous10 years ago
Both; Clinton foolishly let free trade expand quickly. Bush accelerated it while also allowing the removal of almost any regulation on business in America and allowing massive outflows of capital and jobs. Both of them were following conservative economic policies when it comes to trade and regulation which is exactly why the country's economy is in ruins. Clinton at least was able to use some policies on the domestic front to create a thriving economy during his term. Bush had the worst job creation numbers of any modern president, including a term of only 4 years for Carter.
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- TrekdLv 510 years ago
I blame the politicians and Wall street (they go hand in hand) for eagerness to create economic bubbles and then pull out their money at its highest which essentially pops them. When the stock market goes up or down, these rich bureaucrats make money. Unfortunately, too many people try to copy them and often go bankrupt and a lucky or smart few pull out in time.
If the stock market remains completely unchanged, none of these fat cats makes money, except for the working class. So, it is these lifetime politicians that help wall street and the presidents in past, present, and future do not have enough political muscle or "eggs" to change this corruption and the american people are even more powerless, EXCEPT IF WE VOTE THEM ALL OUT!
Vote them all out, its the only way. It will go down forever in the history books and we will be the envy of the world if we do so.
- Chewy Ivan 2Lv 710 years ago
I blame the shift in the make-up of the American economy beginning with Reaganomics. That seems to be when maximizing profit margins became the overriding imperative. Free trade agreements encouraged American factories to relocate elsewhere, crippling the earning potential of Americans without college educations. We slid through the 90's riding the boom of emerging markets on the Internet. We bottomed out interest rates and maxed out credit limits in order to ride the housing market boom during Bush's administration. We squandered our wealth on investments which were never as good as advertised while exporting a large chunk of our ability to create new wealth. I don't think any single person or party is to blame for where we are now. Everyone had a hand in it.
If you must have someone to blame, I think the Republican-controlled Congress from 1995 through 2006 are the primary culprits. They passed most of the free trade agreements and deregulation of America's financial sector. They got our economy revving high for a short while, but now the tank is empty.
- 10 years ago
Fannie Mea and Freddie Mac are Bill Clinton's babies and then they Blame Clinton's Mutated Incestuous Spew on George W Bush
look it up for your self
- Anonymous10 years ago
Bill's econ was the best in the post-ww2 period, if not in American history.
G.W.Bush is blameless bc he was merely a failed speech reader.
We must however blame President Cheney who ruled the Bush Admin's w/ an iron fist, and who's ideology of tax cuts, massive deficits, across-the-board deregulation, and aggressive, illegal, enormously expensive, failed resource wars plunged the US, and the world, into the worst economic crisis since Hoover's Great Depression.Source(s): Reagan said, and Cheney agreed, "Deficits dont matter" http://www.cbsnews.com/stories/2004/01/09/60minute... Paul Krugman, [Nobel Laureate in Econ], How the GOP’s "ideology of free-market fundamentalism" caused The Great Recession, [of 2008-9] and was started by the Reagan Admin & continued by Greenspan & Cheney http://www.nytimes.com/2010/03/08/opinion/08krugma... Paul Krugman: "Cheney & Nixon were the worst people to ever have controlled the exec branch." http://www.nytimes.com/2009/08/31/opinion/31krugma... Excerpts from the expose book "Angler," by 2x Pulitzer winner Barton Gellman on how Cheney seized the VP and the presidency http://blog.washingtonpost.com/cheney/?hpid=specia...
- JON MLv 610 years ago
Nixon, when he took us off the Gold standard. All downhill from there. Some times it takes a while for it to filter through, but when it does, pow! The internet bubble started the latest wave down, and we have been printing money for a decade now.Source(s): Purchasing power.
- avomaticLv 710 years ago
Permissive policies which eliminated the tariffs that once protected American domestic manufacturing are to blame, we have Reagan,Bush Sr. and Clinton for that.