Friday, October 3, 2008



I sent the following e-mail to an old, good, and frighteningly smart friend who passed along to me one of those e-mails blaming the Democrats for the current housing crisis. While the Democrats certainly bear some of the blame, there is plenty to go around, and not all of it should be directed at Washington or New York:


Yes, the Dems used Fannie and Freddie as a piggy bank and an errand boy for decades and thus helped inflate the housing bubble. But the Bush administration did its part to push us to the precipice, pushing and pulling all manner of fiscal and regulatory levers to "encourage home ownership," including sweetening tax treatment of home ownership and, as recently as early this year, lowering capital requirements for Fannie and Freddie so that they could make more mortgage money available.

And how about Greenspan inflating the bubble with easy money for years and years lest we have to (egads!) suffer a recession? And who appointed Greenspan? Reagan. Who kept reappointing Greenspan? Clinton and the two Georges. They're all the same. Democrats, Republicans...the only choice is the direction in which you want the government to grow, and often there is no difference in that matter, either, as in this abominable, pork-laden bailout package. You're already hearing the Wall Street guys yelling "Fire" again, looking for more. And, like lap dogs looking for doggie treats, both Dems and Republicans will sit up and beg before their masters, i.e., anyone capable of writing a campaign check.

And lest you think I never say anything good about politicians, thank God for that handful of stout-hearted Republicans and Democrats who stood against this bloated, ghastly socialization of our financial system.

Neither party created this crisis (The American public would do well to take a good, long look in the mirror when seeking scapegoats; as I've said before (quoting Steve Goodman), you only fall for lies and stories when you really want to.), but both parties abetted this financial firestorm and will continue to abet it, admittedly often (but far from always) with the best of intentions.

One more thing...Though it's hard for me to say much good about most Democrats, the last great (even good) Fed chairman, Paul Volcker, was appointed by a Democrat (Jimmy Carter). And, though it’s hard for me to say much good about most Republicans, Ronald Reagan had the good sense to reappoint the towering (in more ways than one) Mr. Volcker.

(As you can see, I’m trying to adopt a more positive attitude by saying good things about people, even about politicians, when such laudation is merited.)

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