Fineman: It's Clinton's Fault

I kid you not. Just now Howard Fineman said that Bill Clinton was to blame "because Fannie Mae and Freddie Mac were securitizing mortgages." What stunning ignorance.

Hell Howard, let's blame FDR while you are at it:

Fannie Mae was created in 1938 as part of Franklin Delano Roosevelt's New Deal. The collapse of the national housing market in the wake of the Great Depression discouraged private lenders from investing in home loans. Fannie Mae was established in order to provide local banks with federal money to finance home mortgages in an attempt to raise levels of home ownership and the availability of affordable housing.

Or maybe LBJ:

In 1968, due to fiscal pressures created by the Vietnam War, Lyndon B. Johnson privatized Fannie Mae in order to remove it from the national budget. At this point, Fannie Mae began operating as a GSE, generating profits for stock holders while enjoying the benefits of exemption from taxation and oversight as well as implied government backing. In order to prevent any further monopolization of the market, a second GSE known as Freddie Mac was created in 1970. Currently, Fannie Mae and Freddie Mac control about 90 percent of the nation's secondary mortgage market.

What exactly is Fineman blaming Clinton for? I have no freaking clue. Fineman is repeating the racist GOP attack on the CRA:

It was the Clinton administration, obsessed with multiculturalism, that dictated where mortgage lenders could lend, and originally helped create the market for the high-risk subprime loans now infecting like a retrovirus the balance sheets of many of Wall Street's most revered institutions. Tough new regulations forced lenders into high-risk areas where they had no choice but to lower lending standards to make the loans that sound business practices had previously guarded against making. It was either that or face stiff government penalties.

The untold story in this whole national crisis is that President Clinton put on steroids the Community Redevelopment Act, a well-intended Carter-era law designed to encourage minority homeownership. And in so doing, he helped create the market for the risky subprime loans that he and Democrats now decry as not only greedy but "predatory."

Amazing how Bill Clinton's 1994 initiative did not blow up until 14 years later isn't it? Of course this is utter racist hogwash. Barney Frank has debunked it:

And Howard Fineman repeats this racist GOP BS. What a hack.

By Big Tent Democrat, speaking for me only

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    Not sure... (5.00 / 1) (#1)
    by kredwyn on Fri Sep 19, 2008 at 10:29:28 AM EST
    sounds like SOP CDS at work.

    You think Fineman has ever heard of redlining? (5.00 / 4) (#2)
    by andgarden on Fri Sep 19, 2008 at 10:29:28 AM EST
    Does he think that we should have continued to allow that practice?

    What a fool.

    What a tool. (Fixed you typo) (5.00 / 1) (#104)
    by jawbone on Fri Sep 19, 2008 at 04:11:22 PM EST
    Fineman is just repeating the MCM theme that this is a bipartisan mess (gee, from whom else have we heard that theme?). It permits them to throw some dirt at Bill Clinton and defuse the fury aimed at Repubs.

    It's High Broderism.

    And it's also a Repub talking point.

    So, Fineman and the MCM, the Repubs, and, without naming Clinton, Obama all use the same theme....



    Code (5.00 / 1) (#3)
    by rooge04 on Fri Sep 19, 2008 at 10:30:41 AM EST
    It was the Clinton administration, obsessed with multiculturalism, that dictated where mortgage lenders could lend, and originally helped create the market for the high-risk subprime loans

    Code for: It was Clinton that thought it was a good idea to lend to those credit-less brown and black masses.  How dare he!
    Fineman makes me ill.

    Expect to see this arguemt used though. (5.00 / 1) (#8)
    by Salo on Fri Sep 19, 2008 at 10:34:36 AM EST
    Fineman showed his true colours today.

    His racist ones. (none / 0) (#12)
    by rooge04 on Fri Sep 19, 2008 at 10:36:02 AM EST
    that was implied. (5.00 / 1) (#15)
    by Salo on Fri Sep 19, 2008 at 10:36:47 AM EST
    The CRA doesn't force any bank to give (5.00 / 7) (#7)
    by tigercourse on Fri Sep 19, 2008 at 10:34:33 AM EST
    anyone a loan. It just prevents them from saying "we aren't going to give any loans in Harlem". What an absolute tool. Does he still appear on Countdown?

    Indeed (5.00 / 1) (#16)
    by andgarden on Fri Sep 19, 2008 at 10:37:40 AM EST
    Well it has to be Clinton's fault (none / 0) (#88)
    by litigatormom on Fri Sep 19, 2008 at 01:26:49 PM EST
    Otherwise it would be Bush's fault.

    Howard Fineman is a fool.  He is the ultimate concern troll.  Democrats always have to worry about being accused of something. Republicans can lie with impunity.


    Fineman has had CDS for a long time (5.00 / 1) (#10)
    by Jjc2008 on Fri Sep 19, 2008 at 10:35:29 AM EST
    I never knew why.  Maybe it was because he hated the way those "racists" Clintons dared include people of color in the middle class and wanted to make sure they all had a chance at good jobs, housing etc.

    Fineman is a &^()%%$)%......anything I say about the man would surely be banned.

    You have to admit (none / 0) (#17)
    by Salo on Fri Sep 19, 2008 at 10:37:46 AM EST
    it's a very novel way to tie in cultural theory to bank lending practice.

    Yes, Bill Clinton did insist on (5.00 / 5) (#14)
    by Militarytracy on Fri Sep 19, 2008 at 10:36:42 AM EST
    mortgage companies forging W-2's and making as many mortgages as they could so they could bundle them up and sell them, and sell them, and then resell them.  You are just forgetting.  I can't believe I just read that the Clinton Administration caused all this by being obsessed with multiculturalism.

    Rush Limbaugh would appreciate the argument (5.00 / 3) (#19)
    by andgarden on Fri Sep 19, 2008 at 10:39:23 AM EST
    What an outrageous charge!! (5.00 / 1) (#21)
    by befuddledvoter on Fri Sep 19, 2008 at 10:40:24 AM EST
    Now the Repubs propose that it was Clinton and CRA that caused this debacle??  

    Just looking at my neighborhood with the flood of gentrification and condo conversion, from homes and old factories, the buyers are not minorities at all.  The buyers are overwhelmingly young single professionals, whose ability to meet their mortage payments depends exclusively on their monthly salary.  No cushion whatsoever for loss of employment.  Further, the area was just overdeveloped with huge luxury condo complexes, with unsaleable units.  

    CRA is not even an issue in my neighborhood.  Banks/mortgage lendors have been overwhelmingly approving mortgages for developers with no collateral whatsoever, despite the glut on the market. I know firsthand neighbors who were able to get financing in excess of 2 million, when they had no track record in housing development/construction, and minimal income.  


    hm (5.00 / 1) (#23)
    by connecticut yankee on Fri Sep 19, 2008 at 10:40:41 AM EST
    Funny, I seem to remember Bush preaching the "ownership society" like it was the latest revelation from the bible.  And stripping regulations from the market was Clinton? Really? So the GOP were all held at gunpoint?

    Also (none / 0) (#89)
    by litigatormom on Fri Sep 19, 2008 at 01:27:57 PM EST
    let's recall that all fiscally irresponsible laws were passed in the last two years that the Democrats had a bare majority in Congress, rather than in the prior six.

    Fannie mae started getting loosey-goosey (5.00 / 2) (#40)
    by Exeter on Fri Sep 19, 2008 at 10:50:44 AM EST
    in 2000/ 01.  This was after Clinton left, but I don't know if it was from policies he put in place. It's kind of funny that "genius" Alan Greenspan is escaping all scrutiny.

    Fineman isn't the only one blaming the (5.00 / 4) (#47)
    by Jjc2008 on Fri Sep 19, 2008 at 11:02:28 AM EST
    Clintons.  Arianna is happy to blame them too. Isn't it amazing.  The woman who loved her some Newt and was best friends and all with the neocons, going on every show to trash the Clintons in the 90s, is continuing to make millions on Clinton hate.
    SICK, really really sick.

    I watched as they started this BS (5.00 / 3) (#48)
    by Stellaaa on Fri Sep 19, 2008 at 11:03:30 AM EST
    Man, what a bunch of cowards.  Frank is right, the CRA institutions did not get into this mess.  FNMA and Freddie were profitable when they were making loans that met the standards of lending.  Their securities did not have the problem, it was when the Mortgage Bankers and Wall Street wanted to get into the business and copied the style.  FNMA's and Freddie is not in the underlying loans, it's the real estate market going down and the properties losing value.  

    My gawd, this is their answer?  

    I worked on CRA stuff for 10 years.  I bet you those loans still perform.  Not one standard of lending was violated: Debt to income ratios etc.  It was the crooks and liars that came in when they saw that they could make an easy buck.  

    The same Barney Frank that five years ago said: (none / 0) (#75)
    by cib on Fri Sep 19, 2008 at 11:39:05 AM EST
     "These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis, the more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing."

    And this guy has credability, how?


    Credible Ad Hominem (none / 0) (#80)
    by blogtopus on Fri Sep 19, 2008 at 11:58:23 AM EST
    Does what you quote change anything he just said? Seriously.

    It shows he has either no balls or no brains (none / 0) (#81)
    by cib on Fri Sep 19, 2008 at 12:02:09 PM EST
    This problem could have been fixed five years ago.

    But he was too busy claiming there wasn't a problem.

    I hope he and Bush both end up in hell forever.


    Barney Frank is a gem (5.00 / 3) (#50)
    by Steve M on Fri Sep 19, 2008 at 11:05:23 AM EST
    It's so rare to see a politician who actually knows what they're talking about.  He could very well be the sharpest member of Congress in either party.

    BTD is exactly right on the history.  The secondary mortgage market dates all the way back to the friggin' New Deal.  We wouldn't have an American Dream without it.

    Going back to the violence over open housing laws in the 1960s, it is truly amazing how much anger and resentment has been created in this country by the simple effort to try and give minorities a fair shot at their own American Dream of home ownership.

    On June 22, 1963, Martin Luther King came to my hometown to say this:

    I have a dream this afternoon that one day right here in Detroit, Negroes will be able to buy a house or rent a house anywhere that their money will carry them and they will be able to get a job.

    Sorry, Dr. King.  Apparently your dream broke the financial markets.  I guess you're just going to have to wait a while longer.

    That's exactly how I read this (5.00 / 3) (#66)
    by andgarden on Fri Sep 19, 2008 at 11:25:00 AM EST
    My title might have been "Howard Feinman: Segregationist"

    Does Howard agree (none / 0) (#90)
    by litigatormom on Fri Sep 19, 2008 at 01:29:58 PM EST
    with Trent Lott, who declared that if only Strom Thurmond had been elected president in 1948, "we wouldn't have had all these problems?"

    Guess the Democrat? (5.00 / 1) (#56)
    by Sweet Sue on Fri Sep 19, 2008 at 11:11:10 AM EST
    [new] Yea and the acceptance by many (5.00 / 1) (#36)
    by Jjc2008 on Fri Sep 19, 2008 at 10:49:18 AM EST
    democrats that the LBJ's great society was killing America, the acceptance of many democrats that it was "morning in America" with Reagan, and the acceptance of many democrats that affirmative action is wrong; the acceptance of many democrats that the 1950s were a wonderful time are things that gave us a congress, republican and democrats alike voted in by people being duped into the belief that "poor people, women and minoities wanting too much were the problem

    Well said and I can immediately think of one Democrat who thinks Reagan was just great-a real dynamics changer.

    What is so sad is that (5.00 / 3) (#70)
    by Jjc2008 on Fri Sep 19, 2008 at 11:30:36 AM EST
    still the nuleft does not get it.  On many blogs, the worship of the pundit class, including Fineman, is steadfast.  The same pundit class that has been blaming Bill Clinton for everything from Somalia to their own hang nails is still adored by the nuleft.

    Arianna Huffington is already on board blaming the Clintonites along with Fineman.  These people will get the support of the nuleft....and we will continue to go in circles.


    The deep, deep state of denial, (5.00 / 4) (#61)
    by esmense on Fri Sep 19, 2008 at 11:17:22 AM EST
    self indulgence and self pity that our country's elites are living in is a wonder to behold. From the most powerful and influential among us, on Right and Left, we hear the same pathetic cry -- everything is the fault of the least powerful and influential among us.

    Fineman and others of his class -- whether liberal or conservative -- have been living high on the financial excesses and abuses of the last 30 plus years -- while working and middle class Americans have been steadily losing ground and the poor have found the door to the middle class shut tight against them. But now that those excesses have caused a little (and probably limited) flutter in their portfolios it's all the fault of Clinton and poor minorities.

    I just sent an email to Newsweek (5.00 / 3) (#68)
    by Jjc2008 on Fri Sep 19, 2008 at 11:27:51 AM EST
    blasting Fineman.  The fact the rich pigs like him, Matthews, Russert, Williams and others pretending to be centrist and even liberal in some cases, got to influence so many back in the 90s sickens me.

    Sometimes when I see and hear people like Matthews lamenting the policies of Bush NOW, after years of praising and worshipping him, after helping him get elected with the way they trashed the Clintons and Gore, I get sick.  MSNBC has helped put us where we are and still the left adores them. I don't get it.


    Cognitive dissonance. (none / 0) (#74)
    by oldpro on Fri Sep 19, 2008 at 11:36:25 AM EST
    Variation on a Theme... (5.00 / 1) (#78)
    by santarita on Fri Sep 19, 2008 at 11:40:42 AM EST
    I'm surprized that Fineman didn't note that Clinton was to blame also for the repeal of Glass-Steagull and that that is the cause of the current crisis.

    There is no single, simple "but-for" cause of the meltdown.  It would be nice if there were because the fix would be fairly simple.  

    Fineman should be ashamed of himself.  And tv outlets that carry him should be send him back to school before they let him back on their programs.

    Yes, Yes (5.00 / 1) (#79)
    by BDB on Fri Sep 19, 2008 at 11:58:17 AM EST
    It continues to be those excesses of the 1960s and 70s - this time civil rights - that the media continues to claim is destroying this country as opposed to the excesses of the GOP - no regulation is too much regulation - that are actually destroying this country.  Funny how so many rich white men seem to think that the main problem here is the Government ensuring non-white people could get loans.  

    And I'm pretty sure that Bill Clinton did not advocate lenders selling people of color subprime loans when they qualified for regular mortgages.  A common practice in recent years to up the lenders' profits at the expense of people of color.  But, of course, Fineman probably can't envision a world where lots of people of color qualify for regular old mortgages just like the Village gets.


    Deregulation of every sort... (5.00 / 1) (#84)
    by Aqua Blue on Fri Sep 19, 2008 at 12:21:51 PM EST
    started in the Reagan years.

    Capitalism without some control for social welfare will not work because of greed for money and power.

    The Republicans are fully to blame.

    Frontline on PBS did a history of ... (5.00 / 2) (#87)
    by santarita on Fri Sep 19, 2008 at 12:40:10 PM EST
    financial institution deregulation that was quite interesting.  It did show that it started with Reagan.  

    The neoleft are angry because Bill didn't (5.00 / 1) (#106)
    by hairspray on Fri Sep 19, 2008 at 04:27:03 PM EST
    reverse the twleve years of trickle down cheap credit.  I am not an economist, and I don't know what was in the minds of Clinton, Rubin, Summers, etc. but spurring home ownership to people who hadn't had a chance before, and taking advantage of the economic dynamics seems to have been a big factor.  It did allow Bill to pay down of the debt, safeguarding social security and other safety nets. It certainly helped lift millions out of poverty and spur incredible growth in minority communities, just to name a few things. And I agree with someone upthread, the excesses of the Bush Administration like the war in Iraq, and the cuts in taxes and the corruption would not have happened if Gore had prevailed.

    Actually it started under Carter (none / 0) (#111)
    by Robert Drake on Fri Sep 19, 2008 at 11:03:49 PM EST
    Both the trucking industry and the airlines were deregulated under Carter and a Democratic congress. Then they deregulated S&Ls, which occurred under Reagan, with the aid of many corrupt Democrats of the Boll Weevil persuasion.  

    Were Fannie and Freddie (5.00 / 1) (#103)
    by mkevinf on Fri Sep 19, 2008 at 04:06:33 PM EST
    in trouble 5 years ago? Maybe Barney was right at that time.  I do know that the subprime lender, not a bank, that I worked for went under in 2005.  The shenanigans at that company were probably - surely - criminal as they doctored the number of monthly delinquencies by telling customers to send a check even if they had no money. The check would arrive near month's end, the company would deposit it and count it as a monthly payment, the check would bounce a day or so into the new month and the cycle began again.  These loans were part of "securitization" that for a few years paid investors very big bucks.  But it was always a house of cards.
    Again, Fannie and Freddie had no say over loan made by my company.  And that invisible hand of the market was giving most of us the finger.

    The acceptance of deregulation... (3.00 / 2) (#6)
    by Salo on Fri Sep 19, 2008 at 10:33:12 AM EST
    ...by Democrats and the acceptance of the 'Invisible Hand' among people that should know better on the social democratic left allowed and enabled the Lassez faire chaps to loot the economy.

    So there is at least that sort of blame to go around.  The left in the House and Senate accepted right wing economic orthodoxy.

    Nonsense (5.00 / 2) (#9)
    by Big Tent Democrat on Fri Sep 19, 2008 at 10:35:12 AM EST
    This is utter BS.

    The Clinton Administration regulated the hell out of the financial markets.

    Stop the BS.


    I'm not talking about Clinton... (5.00 / 1) (#13)
    by Salo on Fri Sep 19, 2008 at 10:36:24 AM EST
    ...i'm talking about how Democrats sang to high heaven about the Free Market.

    the law of unintended consequences (none / 0) (#82)
    by vicndabx on Fri Sep 19, 2008 at 12:07:24 PM EST
    may be the best defense available at this point.

    Yes, and Hillary proposed (5.00 / 2) (#85)
    by Aqua Blue on Fri Sep 19, 2008 at 12:24:43 PM EST
    legislation 2 years ago to stop this craziness.

    Barney Frank stated that the Republicans filibustered 97 times to prohibit legislation that would protect the general public.


    I'm talking about the broad (5.00 / 1) (#96)
    by Salo on Fri Sep 19, 2008 at 01:52:52 PM EST
    ideological surrender that the party made to embrace capitalism.

    Yea and the acceptance by many (5.00 / 6) (#36)
    by Jjc2008 on Fri Sep 19, 2008 at 10:49:18 AM EST
    democrats that the LBJ's great society was killing America, the acceptance of many democrats that it was "morning in America" with Reagan, and the acceptance of many democrats that affirmative action is wrong; the acceptance of many democrats that the 1950s were a wonderful time are things that gave us a congress, republican and democrats alike voted in by people being duped into the belief that "poor people, women and minoities wanting too much were the problem.

    I still have friends who insist their sons have been cheated because blacks and women got chances before them.  Hell, yesterday some black women from Townhall.com was moaning on Hardball about how she Title IX had to be fixed because it could  hurt her son's chances at athletics.  And yet to this day, I have seen schools where the gymnastics equipment for women was so old it was dangerous yet the school could build a new stadium for football.

    We are a country whose priorities are damn screwed up.......

    Just because people want to blame Bill Clinton does not make it true.  As Pogo would say, "I have seen the enemy and it is us."


    I myself was told 30 years ago (none / 0) (#92)
    by litigatormom on Fri Sep 19, 2008 at 01:37:57 PM EST
    that I had taken someone's "place" at an Ivy League law school because I was a Hispanic woman.  Apparently, the fact that his father and grandfather had attend the same school was supposed to make up for his utterly mediocre grades and LSAT scores.  He apparently believed that my much better grades and LSAT scores had had no place in the law school's decision making process.

    Today, it's not just the sons of Wall Street lawyers and federal judges who believe that their children are being deprived of their rightful "place" at elite institutions.  Mike Barnicle, who regularly appears on Hardball and Morning Joe, has repeatedly opined that some voters resent Obama, asking themselves, "How did Barack and Michelle Obama get into those schools?"  (You know, Princeton, Columbia, Harvard.) Barnicle makes these observations without bothering to add, "That kind of thinking is racist." Or wrong.


    Ah yes.....how Archie (none / 0) (#109)
    by Jjc2008 on Fri Sep 19, 2008 at 10:13:44 PM EST
    reminded so many of just how ignorance works.

    I hear you (none / 0) (#110)
    by Jjc2008 on Fri Sep 19, 2008 at 10:15:59 PM EST
    A good friend of mine, an Hispanic woman, well educated, a principal of a school, has a daughter who was brilliant and assertive.  Man did that p*ss people off.  How dare this young Hispanic female have a voice??  My friend and I used to roll our eyes at some of the notes she got when her daughter was in high school.  She challenged the status quo and man that make some people so uncomfortable.

    I wouldn't use accept as much as I would (none / 0) (#102)
    by hairspray on Fri Sep 19, 2008 at 04:05:17 PM EST
    say the democrats were reluctant participants or resigned to the rules of the Republicans who controlled the congress much of the time Bill was in power.

    Wait a minute (1.00 / 2) (#18)
    by Nevart on Fri Sep 19, 2008 at 10:39:05 AM EST
    There's at least a kernel of truth to what Fineman is saying, in the sense that Fannie and Freddie used to hold on to their mortgages, receiving the interest payments, as banks did in the old days.  Thus, there was an omnipresent incentive to make sure that the loans were good ones which could be re-paid.  Clinton-era deregulation allowed the "securitization" of these loans -- thus Fannie and Freddie had less to worry about (in theory) if the loans went bad; they'd already been sold off to someone else.  And Fannie and Freddie got into this in a big way, extending more and more iffy loans.

    That said, it's important to recall also that (a) the legislation that permitted this all was written by the Republican Congress and (b) lax oversight and other rule changes in the Bush Admin made it all worse.

    But Fineman is right in the sense that Clinton opened the door to the kind of abuses we've seen.  Then Bush kicked the door wide open and Fannie and Freddie and the rest of the financial community went on a crazy spree.

    No, you wait a minute (5.00 / 2) (#22)
    by andgarden on Fri Sep 19, 2008 at 10:40:39 AM EST
    You think this crisis has to do with Bill Clinton's interest in multiculturalism? HF does.

    Wait a minute! (5.00 / 2) (#29)
    by Big Tent Democrat on Fri Sep 19, 2008 at 10:44:32 AM EST
    There is not a kernel of truth in your comment. Bill Clinton did not privatize Fannie Mae and Freddie Mac.

    They have been the SECONDARY mortgage market forever - to wit. Clinton had nothing to do with what you are complaining about. Which, btw, was NOT the problem anyway.


    Yea but (5.00 / 3) (#42)
    by Jjc2008 on Fri Sep 19, 2008 at 10:53:22 AM EST
    blaming the Clintons is what the new, progressive left does.  These are people like Arianna and other blog leaders from the left do.

    Of course Ms HuffBO was a die hard republican Clinton hater anyway so it was easy for her.  But this is not the first time I have heard the Clintons blamed for the Bush years......a blog I used to frequent has been spinning this for the last year.

    Fineman is one of their heroes.


    Am i wrong (none / 0) (#44)
    by Nevart on Fri Sep 19, 2008 at 10:53:47 AM EST
    Am i wrong about the securitization of loans?  If so, I stand corrected.  

    Quite wrong (none / 0) (#45)
    by Big Tent Democrat on Fri Sep 19, 2008 at 10:54:58 AM EST
    If Freddie and Fannie (none / 0) (#46)
    by TimNCGuy on Fri Sep 19, 2008 at 10:55:28 AM EST
    securitized and sold all their loans (as you suggest) how could they have gotten in trouble?

    Because (none / 0) (#62)
    by Nevart on Fri Sep 19, 2008 at 11:20:51 AM EST
    Because they got stuck with a bunch they can no longer sell.

    But (none / 0) (#63)
    by Nevart on Fri Sep 19, 2008 at 11:21:42 AM EST
    But according to BTD, I'm wrong about the securitization anyway.

    Bullcrap (none / 0) (#112)
    by Robert Drake on Sat Sep 20, 2008 at 12:09:17 AM EST
    In 1994 the Riegle Community Development Act contained several provisions relieving mortgage lenders of the legal obligation to maintain a capital reserve equal to 8%, or more, of each loan's value. The bill was specifically designed to promote the securitization of the secondary mortgage market! The current crisis is directly attributable to undercapitalization and overleverage. So how are Fineman's statements incorrect?  

    The law's full title was actually the Riegle Community Development and REGULATORY IMPROVEMENT ACT. Clinton and the DLC, to the lament of both the Democratic Party, and the nation, accepted that markets are self-regulating and capable of delivering superior outcomes to government. Thus Clinton's adherence to neoliberalism, which put Clinton closer to Reagan then FDR, or LBJ, by a country mile. Clinton's legacy isn't social security, or Medicare, or Head Start, or FHA, or the Clean Air Act, his legacy is NAFTA, WTO, repeal of Glass-Steagall, Telecom Act, Commodities Futures Modernization Act (Let Enron Steal Act), RCDA, and energy deregulation. If that is unflattering to Clinton, he is only to blame.

    And for those claiming Clinton was some how "forced" to sign Glass-Steagall, I suggest you learn some history. It was the end of his second-term, he had nothing to lose by vetoing the law had he been inclined on principle to oppose it, but the fact is, the conference committee weighing the repeal of Glass-Steagall was deadlocked, and the bill was going to die the death it deserved, then the White House intervened IN FAVOR of repealing the law, as was made clear in the PBS Frontline special on Glass-Steagall. His administration was the first to actually consider junking it, not even Reagan proposed that. Clinton's Treasury Secretary Robert Rubin was an enthusiast for ridding the land of Glass-Steagall, and the law was in fact repealed just a few months after Rubin left to become CEO of Citigroup, the first conglomerate to benefit from the laws demise. A conflict of interest straight out of the Reagan/Bush model. To say that Clinton was a reluctant deregulator, and doesn't bear much of the burden for what we now see is pure revisionism.  


    Clinton did sign (5.00 / 1) (#93)
    by litigatormom on Fri Sep 19, 2008 at 01:41:16 PM EST
    a de-regulation bill in the last two years of his term, but the bill itself was drafted and advocated by Phil "Whiners" Gramm.  Clinton was under intense pressure to sign the bill, and did manage to take out some of the bill's most egregious provisions.

    So it is technically right that it was "Clinton-era" legislation, but it was not part of his agenda. You can fault him for signing it, but it was really the Republicans' baby.


    There you are talking about (none / 0) (#28)
    by Salo on Fri Sep 19, 2008 at 10:44:26 AM EST
    the left accepting lassez faire economics and abandoning a semblance of leftwing idealism.

    There you go again (none / 0) (#32)
    by Big Tent Democrat on Fri Sep 19, 2008 at 10:46:38 AM EST
    buying BS.

    When did they do that? (none / 0) (#39)
    by rooge04 on Fri Sep 19, 2008 at 10:50:37 AM EST
    You're aware that there is whole "mixed economy" view right? There's a nice, Clintonesque middle ground between Socialism and Capitalism. You've bought the GOP talking point of the 90s hook, line and sinker.

    huh? (5.00 / 1) (#91)
    by Salo on Fri Sep 19, 2008 at 01:34:53 PM EST
    The market was embraced by way too many lefties.

    There's no BS in that opinion at all.


    CNBC beats the CRA horse all the time (none / 0) (#4)
    by Katherine Graham Cracker on Fri Sep 19, 2008 at 10:31:21 AM EST
    CNBC constantly blames CRA for the subprime crisis.

    It's always done as kind of a cheap shot because no real discussion of the matter would hold up.

    The crisis in the housing market is caused by all the unfunded Bush mandates to increase  home ownership and by fake cheap credit.

    Anyone who really wants to get (none / 0) (#25)
    by inclusiveheart on Fri Sep 19, 2008 at 10:41:31 AM EST
    their blood pressure boiling should check out what Larry Kudlow was saying on Morning Joe yesterday.  He was blaming "poor people" for this collapse.  If "poor people" were given what Jim Cramer estimates is $2 TRILLION dollars in debt - I fing it hard to believe that the "poor people" are the ones that are to blame - seems to me the lenders have some responsibility here in assessing their risk...

    In any case, I blame drug addicts like Kudlow - at least that's what I said to the TV when he was talking yesterday.


    Every time I happen upon Kudlow he's (none / 0) (#31)
    by tigercourse on Fri Sep 19, 2008 at 10:45:07 AM EST
    saying something stupid in the most annoying way possible. He acts more like a Republcian spokesperson then an economic pundit (or whatever the hell he calls himself).

    Why doesn't anyone ask him (none / 0) (#94)
    by litigatormom on Fri Sep 19, 2008 at 01:43:41 PM EST
    whether his coke habit ever affected his business?  I know he's been in recovery for a long time, but sometimes he says things that are so outrageous -- I heard him blame the crisis on poor people yesterday -- that I have to wonder whether he got all the coke out of his system.

    The world would be sooooo much simpler if we didn't have to deal with poor people and their complete control over the nation's economy.  But then, who would we have to kick around?

    Oh, I forgot, we could always kick around Bill Clinton.


    I wonder how he defines poor people. (none / 0) (#98)
    by inclusiveheart on Fri Sep 19, 2008 at 01:58:24 PM EST
    Peole making less than a Million a year?

    Holy... that third paragraph is absolute lunacy. (none / 0) (#5)
    by tigercourse on Fri Sep 19, 2008 at 10:32:08 AM EST

    Bill Clinton is a good dead horse to (5.00 / 1) (#11)
    by Salo on Fri Sep 19, 2008 at 10:35:35 AM EST
    er beat.

    Barney Frank??? (none / 0) (#20)
    by TimNCGuy on Fri Sep 19, 2008 at 10:40:15 AM EST
    Barney may have debunked this. But, this week Barney has also debunked a little bit of his own credibility. Just this Wednesday Barney was "celebrating" Free Market Day to belittle the administration for at once saying they weren't going to Bail out anyone else and then turning around and bailing out AIG. Now Barney has done a 180 and supports the new plan to bail out the entire financial industry. I'm not saying he is wrong to support the current plan. But, the "phoney" outrage at the AIG bailout was a bit much.

    Why does it have to be phoney outrage? (5.00 / 1) (#26)
    by Militarytracy on Fri Sep 19, 2008 at 10:43:20 AM EST
    I have many friends serving and outraged by this administration and often even the people of this country right now, but they still do what needs to be done everyday........they are just outraged while doing it.

    i guess the point is (none / 0) (#30)
    by TimNCGuy on Fri Sep 19, 2008 at 10:44:43 AM EST
    If Barney was outraged by AIG, why is he OK with the newly announced plan to bail out EVERYONE?

    Because it appears that he (and Biden and (none / 0) (#33)
    by tigercourse on Fri Sep 19, 2008 at 10:47:29 AM EST
    Pelosi) don't know much about the economy. They all came out against bailouts 1 day, and started reversing the next (presumablly after an advisor read them the riot act).

    Oh Bull (none / 0) (#37)
    by Militarytracy on Fri Sep 19, 2008 at 10:50:11 AM EST
    You are a piece of work (none / 0) (#43)
    by Big Tent Democrat on Fri Sep 19, 2008 at 10:53:32 AM EST
    Barney Frank is quite knowledgable. You, on the other hand, sound rather ignorant to me.

    Then why did Biden and Frank reverse their (none / 0) (#83)
    by tigercourse on Fri Sep 19, 2008 at 12:20:35 PM EST
    position? Why did they go from being against a bailout to supporting it?

    because they (none / 0) (#97)
    by Salo on Fri Sep 19, 2008 at 01:54:44 PM EST
    may lack a broad ideological view of things.  Pragmatic etc.

    Every decision made during times like (none / 0) (#35)
    by Militarytracy on Fri Sep 19, 2008 at 10:49:18 AM EST
    these isn't black and white, it is just clamping an artery until we figure out how to repair damage.  I'm certain that Barney is outraged in even having to deal with this BS today and attempt to figure out how to mend and heal what the Repubs broke all to hell.  Happens everyday in Baghdad too, trying to figure out how to hydrate the people without feeding them sewage.  Sometimes there just isn't enough water so you look on the bright side that at least those drinking sewage probably won't die today, maybe we can figure the rest of it out tomorrow if we keep working to get there.

    The point (5.00 / 3) (#41)
    by Steve M on Fri Sep 19, 2008 at 10:50:51 AM EST
    is to ridicule the silly hypocrisy of the GOP on these issues.

    It's like how, whenever the Fed adjusts interest rates, I comment to my conservative friends "Thank God we don't have a centrally planned economy!"  That doesn't mean I oppose the Fed, it just means I am amused by how conservatives preach about the free market but actually favor all sorts of market interventions in practice.


    Great for Barney Frank. (none / 0) (#24)
    by EL seattle on Fri Sep 19, 2008 at 10:40:58 AM EST
    Are any other democrats stepping up to the plate to defend this program (as it was originally established)?  I sometimes get the idea that this "CDS" thing applies to some of the more powerful democrats in the house and senate, too.

    Holy Sh*t (none / 0) (#27)
    by coigue on Fri Sep 19, 2008 at 10:44:26 AM EST
    I did not hear the dog whistle of racism.

    Thanks for pointing that out.

    I crossed the street in front of the (none / 0) (#34)
    by Lahdee on Fri Sep 19, 2008 at 10:48:38 AM EST
    Fannie Mae building once. Am I culpable?

    It's time to bring back this little gem: (none / 0) (#38)
    by Esme on Fri Sep 19, 2008 at 10:50:18 AM EST

    From Wikipedia (none / 0) (#49)
    by Polkan on Fri Sep 19, 2008 at 11:03:46 AM EST
    known GOP hacks:

    The Clinton Administration's regulatory revisions [1] with an effective starting date of January 31, 1995 were credited with substantially increasing the number and aggregate amount of loans to small businesses and to low- and moderate-income borrowers for home loans. Part of the increase in home loans was due to increased efficiency and the genesis of lenders, like Countrywide, that do not mitigate loan risk with savings deposits as do traditional banks using the new subprime authorization. This is known as the secondary market for mortgage loans. The revisions allowed the securitization of CRA loans containing subprime mortgages. The first public securitization of CRA loans started in 1997 by Bear Stearns. [2] The number of CRA mortgage loans increased by 39 percent between 1993 and 1998, while other loans increased by only 17 percent. [3] [4]


    Not multiculturalism, but perhaps "deregulation"?

    Yes (5.00 / 1) (#51)
    by eric on Fri Sep 19, 2008 at 11:06:28 AM EST
    it is the democrats fault for not keeping the criminals in line.

    I don't believe for one minute (5.00 / 1) (#53)
    by Militarytracy on Fri Sep 19, 2008 at 11:08:26 AM EST
    that if Bill Clinton had been sitting in the White House he would have allowed the runaway train that became the mortgage crisis to have continued unaddressed.  His record says everything but that.  Greed did this, monetary greed has never really been one of Bill's blind spots.

    Noooo (5.00 / 1) (#54)
    by Big Tent Democrat on Fri Sep 19, 2008 at 11:09:02 AM EST
    Not correct. Indeed, the cite you love gets the most basic fact wrong -

    [T]he genesis of lenders, like Countrywide, that do not mitigate loan risk with savings deposits as do traditional banks using the new subprime authorization. This is known as the secondary market for mortgage loans.

    That is NOT a secondary market and it is a stunning bit of ignorance that proves yet again you can never trust Wikipedia. A secondary market for ANYTHING is the trade of that debt or commodity beyond the initial transaction. Thus in the case of mortgages, a secondary market is:

    The real estate mortgage market actually consists of two separate sections: the Primary Market and the Secondary Market. The primary market is where loans are originated; mortgage lenders and banks loan money to borrowers for the purpose of financing real estate transactions. These lenders make their profit on the fees that they charge to fund the loans. They then bundle these loan notes together in a package and sell them in the secondary market.

    The secondary market, therefore, manages mortgages that were originated in the primary market. The secondary market consists of investors, both public and private, who buy the mortgage notes. This allows the mortgage lenders to replenish the cash reserves, so that they can originate more mortgages to more consumers. The investors profit from the interest that the mortgages charge.


    In addition to private investors, which inclu


    I was more concerned about this (none / 0) (#58)
    by Polkan on Fri Sep 19, 2008 at 11:12:21 AM EST
    The revisions allowed the securitization of CRA loans containing subprime mortgages.

    And Barney Frank hates securitization, as we now know.


    That is false (none / 0) (#64)
    by Big Tent Democrat on Fri Sep 19, 2008 at 11:22:11 AM EST
    As is the rest of the article.

    You are obsessed with repeating GOP lies.

    Consider the fact that the most BASIC FACT is wrong in the article it astounds me that you rely on it for more complicated statements.


    Well, then tell me where I'm wrong (none / 0) (#67)
    by Polkan on Fri Sep 19, 2008 at 11:27:05 AM EST
    unless it's easier to brand me as a peddler of GOP lies.

    (1) Glass-Steagall act prohibited a bank to have both retail and investment operations. Banks were required to hold mortgages, which motivated banks to redline with stricts lending criteria

    (2) CRA was to expand access to credit to lower-income citizens. Bill Clinton's revision was to expand securitization from car loans to home mortgages. Securitization allows increased credit and lowers lending standard because you can resell the mortgage.


    Let's make this basic (5.00 / 2) (#73)
    by Steve M on Fri Sep 19, 2008 at 11:36:20 AM EST
    Glass-Steagall did not require banks to hold mortgages.  Banks have been reselling mortgages since time immemorial; the point of the New Deal legislation in the 1930s was to help them sell those mortgages so as to provide them with a ready source of new capital for additional mortgages.

    "Banks reselling mortgages" and "the secondary mortgage market" refer to the same thing.  Are you under the impression that there was no such thing as a secondary mortgage market prior to the repeal of Glass-Steagall?  If so, that is incorrect.


    This is not true (none / 0) (#95)
    by Polkan on Fri Sep 19, 2008 at 01:49:58 PM EST
    and you don't know what you're talking about.

    Glass-Steagall forced banks to become portfolio lenders because their loans were funded by deposts.

    Securitization was developed in the 1970s as a way to quickly attract investment to expand credit availability.

    CRA required the banks to lend to all income groups, as opposed to those with lowest risk of default, in other words to lend to subprime borrowers.

    And the Clinton Administration modified CRA by simplifying compliance checks to three "tests" and by cutting paperwork and allowing more flexible lending standards.


    Well (none / 0) (#99)
    by Steve M on Fri Sep 19, 2008 at 02:12:58 PM EST
    I actually work on Wall Street, and you have never shown any actual comprehension of these issues beyond the ability to cut-and-paste, so I'm going to stick to my story.  I don't know what website is telling you that there was no secondary market for mortgages before the 1970s, but it's a woefully misinformed website.

    There could be an informative discussion here if you were ever interested in something beyond lecturing the world about how you're right and everyone else is wrong.


    Thank you for your non-answer (none / 0) (#101)
    by Polkan on Fri Sep 19, 2008 at 02:22:52 PM EST
    I didn't expect anything else.

    I don't even know (5.00 / 2) (#77)
    by eric on Fri Sep 19, 2008 at 11:39:50 AM EST
    where to start with this, it is so wrong.  I don't have the patience.

    Wrong (none / 0) (#76)
    by Big Tent Democrat on Fri Sep 19, 2008 at 11:39:20 AM EST
    on BOTH 1 and 2. Not in totality but in your conclusory statements.

    Ok, some clarification (5.00 / 2) (#57)
    by Stellaaa on Fri Sep 19, 2008 at 11:11:51 AM EST
    FNMA and Fredie Mac always securitized.  But they had standards on the loans they bundled and offered their backing.  

    Countrywide etc:   made loans which they could sell to FNMA or Freddie but they had to meet the lending standards.  

    Wall Street:  broke the lending standards with the predatory lenders and started making 0 down, loans.  Appraisers and realtors were pumping up the prices.  They securitized these loans.  There was no real backing of what would happen when loans failed.  Servicers were stuck with loans that they could not sell back to the originating lender, cause the lender went poof.  Those lenders were not lenders  under the CRA rules.  These were marginal patch ups of ex S& L gangsters who took peoples money.  

    Wikipedia has it wrong.  


    And outfits like... (5.00 / 1) (#71)
    by santarita on Fri Sep 19, 2008 at 11:31:08 AM EST
    Greenlining's Robert Gnaizda advised Greenspan in 2004 or 2005 that there was a lot of predatory pricing and fraudulent lending activities going on in traditionally redlines communities.  greenspan didn't seem interested in doing anything about it.

    But car loans (none / 0) (#59)
    by Polkan on Fri Sep 19, 2008 at 11:15:05 AM EST
    have been securitized since the 1970s also without backing. It's only when the prices collapsed in the housing market that mortgage securitization got the blame.

    Securitization (5.00 / 2) (#65)
    by Stellaaa on Fri Sep 19, 2008 at 11:23:19 AM EST
    when done right is what made the market work, it's when the hacks came in to make a profit that they broke the rules.  
    I watched it as it happened and would scream.  All the affordable housing people opposed this lending because it was predatory lending, it did not want to create affordable housing or homeownership, it took advantage of people through origination fees and lies.  

    We in the affordable housing field saw this coming and screamed bloody murder, but no one listened.  Now to reverse the blame is truly a crime.  

    This was targeted specifically to ethnic poor people with poor promises.  People who lost life savings and were ripped off, thinking they would get a home.  I remember talking to people to not do it, but the alleged lenders, threw slick liars and hoods into the communities.  One of those guys told me " I did not want poor people to own homes"  


    Which is why (5.00 / 3) (#72)
    by oldpro on Fri Sep 19, 2008 at 11:31:22 AM EST
    on retirement, I, a non-Christian, went to volunteer nearly fulltime in fundraising for Habitat for Humanity.

    We hold the mortgages of really poor people who do achieve the dream of home ownership and earn their equity.


    So it's not just any securitaztion then (none / 0) (#69)
    by Polkan on Fri Sep 19, 2008 at 11:28:49 AM EST
    but the one that's done right?



    Interesting and Complex (none / 0) (#86)
    by santarita on Fri Sep 19, 2008 at 12:34:27 PM EST
    There is a lot of information out there and not just in Wikipedia.  So if you are interested you can get up to speed.

    It seemed to me that at some point... (none / 0) (#100)
    by EL seattle on Fri Sep 19, 2008 at 02:15:34 PM EST
    ...these sorts of loans started to get used by folks who were more interested in "flipping" homes than living in a home.  Is that correct, or am I blaming this process for a different failing of the overall system?

    Thanks for the info, btw.


    Has anyone ever done a map or some (none / 0) (#105)
    by Christy1947 on Fri Sep 19, 2008 at 04:17:02 PM EST
    similar financial analysis graphic to find out where the lemon loans were and who got them? If somebody here has that data, one way or the other, please post it.

    I have done real estate in multicultural areas for some years now, and what I recall of who did wht was that the banks who gave loans in our areas usually did so on 'conforming' loan rules, adequate documentation, full downpayments, employment history and verification, no borrowed closing costs and that sort of thing. And that it was the independent mortgage companies who were almost always at the closings where the ARMs and worse were. The one exception I can think of was minor in scope and had to do with developments of real estate on formerly vacant lots where the right to buy went by lottery among those with at least a certain documented income who had been preapproved before they got into the lottery, but on less than full conforming terms, usually smaller down payments, but good credit scores and good employment histories. One problem I do remember that was driven by the nature of our housing stock, is that we had a lot of purchase and construction transactions, which required repair of the building purchased, and I do know that a lot of middle class people got in over their heads when the HUD estimate of necessary repairs and its cost turned out way under - there were always resales where the cost of the reno and not the mortgage itself killed the unwary.

    You can only blame CRA if you have the documented chops to show that a disproportonate number of the loans which have gone sour for reasons which are not related to individual family catastrophe of one sort or another whcih happen to the virtuous and the not so virtuous equally (loss of job, medical, divorce, etc.) and were not ARMS, were CRA driven loans. A comparison of the map and the default list will, I suspect, show a huge number of bad loans outside the formerly redlined areas.  Just my guess.


    I am going to write a diary on this (none / 0) (#52)
    by coigue on Fri Sep 19, 2008 at 11:08:01 AM EST
    for dKos.

    I'll be sure and give you credit.

    Wow Fineman hits a new low! (none / 0) (#55)
    by ks on Fri Sep 19, 2008 at 11:09:22 AM EST
    CDS just never stops.  

    Anyway, back to reality, compare Hillary's great speech today on the Senate floor to Reid's weak tea yesterday.  Sigh...man, he and Pelosi have got to go!

    hm (none / 0) (#60)
    by connecticut yankee on Fri Sep 19, 2008 at 11:15:20 AM EST
    A dem senator whose name escapes me said they were told last night that immediate action was required to prevent a total financial meltdown within days.

    Cliton is at fault (none / 0) (#113)
    by jd2tone on Sun Sep 28, 2008 at 02:03:40 PM EST
    Fact: Clinton did loosen qualification requirements to promote "minority home ownership"

    Why has it taken 14 years to be a problem?

    Home prices have increased for the last 14 years, so people who couldn't afford their homes could sell and get out of it.

    Now, housing prices are drastically down, so people can neither refinance or sell their homes because they are upside down on the value of their homes.

    Why didn't Republicans do anything about it? How could they without all of you yelling "racism" for them attempting to limit minority home ownership.

    Do your own research instead of drinking the liberal kool aid.