July 19, 2010

Covering Their Fannie

Jim Geraghty, from Friday's Morning Jolt newsletter...

The fundamental problem with the [financial reform] legislation is that it doesn't address...the underlying problems with the mortgage market. It was the mortgage bubble, instigated by liberal social justice demands placed on Fannie Mae and Freddie Mac, which caused the crisis, not a failure of securities rules and regulations. No mortgage market problems, no mortgage-backed securities problems; no mortgage-backed securities problems, no financial crisis. One of the greatest scams ever is the success of Democrats in distancing their mortgage policies from the financial crisis, and portraying the crisis as simply a matter of Wall Street greed and lack of regulation. . . . Reform of Fannie Mae and Freddie Mac never is going to happen unless Democrats have no other choice. Not at least as long as Barack Obama is President or Democrats control all or part of Congress. Fannie Mae and Freddie Mac are off limits for Democrats, just as they were when the Bush administration warned of problems.

This was not a problem caused exclusively by one political party, but the ""mess we inherited" rhetoric by the White House necessitates reminding people that the Bush administration did warn of problems...and they did propose reforms...which were shot down and the need for them dismissed by Sens. Frank and Dodd...and as you can see here...

UPDATE 8/23: With an election looming, Barney Frank sees the light.

UPDATE 8/24: The Obama administration fesses up about who their HAMP program was designed to help.

Posted by dan at July 19, 2010 2:33 PM