# Is George W. really to blame for our economic situation? **URL:** \ **Category:** Great Debates\ **Created:** [March 4, 2009, 5:53am UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249 "2009-03-04T05:53:47Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [March 4, 2009, 5:17pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/21 "2009-03-04T17:17:26Z")
NAFTA was a Clinton move. Shipping jobs abroad has given us huge problems. We can not create manufacturing or industrial jobs because we made it easy and profitable to ship them abroad. They are gone. Obama wants to create jobs ,but where can he do it? Many jobs were in financial and housing markets. How do we get them back? Bush greased the skids to move the jobs abroad for short term profits. We have no jobs base any more. His admins deep belief in non regulation ,pushed by Gramm and Greenspan, was a major contribution to the destruction of our economy. Bush waged an expensive war and cut taxes at the same time. How stupid was that? ---
**Author:** ![Ocean\_Annie](https://avatars.discourse-cdn.com/v4/letter/o/8797f3/32.png) [@Ocean\_Annie](https://boards.straightdope.com/u/Ocean_Annie)\ **Post date:** [March 4, 2009, 5:38pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/22 "2009-03-04T17:38:01Z")
I agree that there is plenty of shared blame. The deindustrialization, suppressed wages, and repeal of banking regulations that led to thriving credit markets and the financialization of the economy took place over a span of decades, but the bottom line is Bush was the President during the rise and crash of the housing bubble –-he’s the winner. ---
**Author:** ![TooSchoolforCool](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tooschoolforcool/32/19621_2.png) [@TooSchoolforCool](https://boards.straightdope.com/u/TooSchoolforCool)\ **Post date:** [March 4, 2009, 5:41pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/23 "2009-03-04T17:41:30Z")
Greenspan definately is to blame, and he spanned many administrations. However, given that he seems really sorry, I’m more sympathetic to him than I am to people like Chris Cox, who turned a blind eye to increasingly absurd financial bets and instruments, even after some people started trying to get his attention and warn him about their dangers. The government’s role in the housing crisis has been vastly overplayed (mostly by people who like nice satisfyingly-self-aggrandizing answers like “poor minorities did this!”), but it certainly played a part. The “Macs” did not start the crisis (in some ways, they chased after it, behind the ball on what everyone had come to decide was a huge business opportunity), nor were they decisive players, but they played their role, and disappointingly given that they and Congress are supposed to do their work with some though and oversight. It’s pretty clear that the Bush years saw a major weakening of regulatory oversight all around the board, something that was either driven by incompetence or ideology, your pick. But again, saying that is not the same thing as saying that a stricter regulatory framework would have averted this particular disaster. Regulators, unfortunately, are often caught flat-flooted by totally new ways to cheat that evolve in the markets much faster than legislation can catch up. ---
**Author:** ![smiling\_bandit](https://avatars.discourse-cdn.com/v4/letter/s/e9a140/32.png) [@smiling\_bandit](https://boards.straightdope.com/u/smiling_bandit)\ **Post date:** [March 4, 2009, 6:24pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/24 "2009-03-04T18:24:55Z")
Deregulation is not particularly at fault here. Not only are the financial markets highly regulated anyway, but the specific problem was one that Congresscritters encouraged. They wanted cheap mortgages any way they could. I don’t feel a lot of sympathy for the mortgage companies, but everyone wanted what happened to happen. They just didn’t think about the consequences of their wants, and the roots of this go back two decades. Secondly, the problem was that nobody _realized_ there was a problem. Sure, it looks obvious in hindsight, but at the time almost nobody (and certainly nobody in government) expected the crash. They were all busy making the bubble bigger, and nobody really understood the CDO’s or even knew _how_ to regulate them. Ye leftists want any excuse, I’m sure, to hate on him. But the fact is that he was doing the right thing by not trying to micromanage departments, and his appointees were frequently right to not get involved. Not everything is the executive’s problem (or sometimes even Congress’s), and if we all accepted that, things would go a lot better overall. To be honest, I’m not even a great supporter of Bush’s. I favored him against Gore and Kerry, sure, but not enthusiastically. I dislike his domestic goals. Nonethless, the left’s failure to honestly examine his record, and often to insist it’s something completely different than what it was, compels me to defend his good name. Thus, I can’t agree with **Sage Rat** ’s points. In 2001, (heck, even today) it wasn’t even clear how you could “reboot” the economy after the Dotcom crash. You can’t magically conjure up economic opportunities, as Obama is learning right now. A mild tax cut was probably the best, or only, thing to do, and any attempt to inject massive piles of cash into the economy would have accomplished nothing except inflation. Moreover, the economy recovered about as fast as it could have. You can, I suppose, blame everyone if you like, but Bush is pretty far down the list. Likewise, the repeal of the Glass-Steagal Act didn’t actually change the fundamental problem: credit raters were issuing dishonest ratings even on investments not offered by companies in the same family as themselves. You can argue these all contributed, and I won’t argue. The point is that eveyone wants to point fingers at somebody across the aisle of political alegiance claim “He did it! He’s the guilty party! That’s the guilty Party! Vote against them and give me, me, me all the power!” And that’s just stupid. If you accept that people ought to be able to make their own choices, they will choose badly sometimes, and behave badly sometimes, and governments can’t always know what they’re doing, or how to stop it, or what the consequences of doing it might be. And that assumes the government peeps are even trying to do their jobs properly in the first place, whereas we’ve been learning that more than a few of thewm were in bed with the people they were supposedly regulating. ---
**Author:** ![elucidator](https://avatars.discourse-cdn.com/v4/letter/e/8edcca/32.png) [@elucidator](https://boards.straightdope.com/u/elucidator)\ **Post date:** [March 4, 2009, 6:42pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/25 "2009-03-04T18:42:07Z")
Well, let’s see. First off, we got borrowing 1.4 Godzillabucks to finance that clusterfuck in Iraq. Of course, it wasn’t supposed to be like that, all the really cool guys agreed it would be in, out, and over. Slam in through the Balkans, be in Moscow by late August and then…wait, different debacle. Then theres hiding the cost by every trick available, first and foremost by not putting the cost on the books, where we could see it. And the housing bubble. Any one hear the words “ownership society” lately? Anytime anyone groused about how unsustainable all of this was, the cheerleaders would rush out waving their pom-poms, the confetti and streamers would flow down, and we would hear more about how great the housing market was doing, everybody was making money hand over fist, it was all for M&M Enterprises, and everybody has a share! And finally, the cherry atop the turd sundae: deregulation. No rules. Make it up as you go along. Want to sell insurance on investments? Don’t much like the idea of setting aside money to cover if Something Goes Terribly, Terribly Wrong? Well, then, don’t sell “insurance”, sell “credit swaps”! Besides, everybody knows that the housing market will only go up! So, go ahead, suck out some equity to cover your credit card debt, no problem, next month, your house will be worth that much more anyway! So, Bush’s fault? First one, for sure and for certain. The rest? Well, did you see them do anything to stop it? Or did you see them reassure us that the “engine” of the housing market would make us all rich? “Ownership society”, my ass! ---
**Author:** ![Lemur866](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lemur866/32/434_2.png) [@Lemur866](https://boards.straightdope.com/u/Lemur866)\ **Post date:** [March 4, 2009, 6:48pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/26 "2009-03-04T18:48:18Z")
> [@smiling\_bandit](#): > > Thus, I can’t agree with **Sage Rat** ’s points. In 2001, (heck, even today) it wasn’t even clear how you could “reboot” the economy after the Dotcom crash. You can’t magically conjure up economic opportunities, as Obama is learning right now. A mild tax cut was probably the best, or only, thing to do, and any attempt to inject massive piles of cash into the economy would have accomplished nothing except inflation. Moreover, the economy recovered about as fast as it could have. I have no problem with Bush’s handling of the dot-com bubble. The bubble crashed, we have a recession, we cut taxes and increase spending, and pretty soon we recover. It’s what happened after the recovery that’s the problem. Oh, we’re at war, so it’s OK to increase spending and not increase taxes. And so rather than balance the budget like we managed to do during the Clinton years, we continue to borrow, borrow, borrow. And then when the next recession hits, we find ourselves deep in a hole and digging deeper. ---
**Author:** ![TooSchoolforCool](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tooschoolforcool/32/19621_2.png) [@TooSchoolforCool](https://boards.straightdope.com/u/TooSchoolforCool)\ **Post date:** [March 4, 2009, 7:36pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/27 "2009-03-04T19:36:58Z")
> [@smiling\_bandit](#): > > Deregulation is not particularly at fault here. Not only are the financial markets highly regulated anyway, but the specific problem was one that Congresscritters encouraged. They wanted cheap mortgages any way they could. I don’t feel a lot of sympathy for the mortgage companies, but everyone wanted what happened to happen. They just didn’t think about the consequences of their wants, and the roots of this go back two decades. Again, while Congress shares some of the blame here, it wasn’t Congress that was driving the creation of the financial instruments at fault: the Macs, for instance, were playing catch-up in a lot of ways running after where the market was already heading, and the sorts of deals that were already being made (even to the point of crowding the Mac’s themselves out of the game). And people were complaining about predatory lending for a long time before this crisis happened, and we mostly avoided calls to regulate it. I also don’t think you can plausibly claim that the financial markets are highly regulated as a sort of blanket statement. There were a lot of obvious holes in the regulation: holes that people complained about. But people argued that we shouldn’t worry about them, and we largely didn’t, and… whoops! I don’t see how that makes, as you would have it, a very good argument in general for the idea that, yep, we were right not to have tried! You have a much stronger point about hindsight: no one really understood the financial devices that were created. But I still don’t see how this is a good argument against it even being possible or worthwhile to try, or that the complicity of politicians proves that we should just turn a blind eye to the whole problem and not worry about who’s in bed with who, and what bad choices that might result in. ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [March 4, 2009, 7:44pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/28 "2009-03-04T19:44:43Z")
> [@tagos](#): > > Quite. And another example of the flagrantly dishonest debating tactics the Right has to engage in (not addressing an individual poster here as pinning this to Clinton has been a growing conservative meme). The veto could not be sustained. Rubin,Gramm , Paulson and Greenspan all pushed had to deregulate and trust the bankers. They were foolish and wrong. Bush just took everything to a lower level. He was a believer in dereg and gutted every agency. He was the wrong man, in the wrong place, at the wrong time. ---
**Author:** ![smiling\_bandit](https://avatars.discourse-cdn.com/v4/letter/s/e9a140/32.png) [@smiling\_bandit](https://boards.straightdope.com/u/smiling_bandit)\ **Post date:** [March 4, 2009, 7:51pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/29 "2009-03-04T19:51:20Z")
> [@Lemur866](#): > > It’s what happened after the recovery that’s the problem. Oh, we’re at war, so it’s OK to increase spending and not increase taxes. And so rather than balance the budget like we managed to do during the Clinton years, we continue to borrow, borrow, borrow. And then when the next recession hits, we find ourselves deep in a hole and digging deeper. I won’t exactly disagree with that, but neither the Republican nor Democratic Congresses, who were and are the ones responsible for setting the budget, have done their jobs properly. And have not since _at least_ the early Clinton years, when IIRC, control was divided enough that everyone had to make sacrifices. IM my opinion, the dotcom bubble was a big factor here, as they got used to ever-increasing tax revenue and easy money and siphoning off public funds. > [@TooSchoolforCool](#): > > I also don’t think you can plausibly claim that the financial markets are highly regulated as a sort of blanket statement. There were a lot of obvious holes in the regulation: holes that people complained about. But people argued that we shouldn’t worry about them, and we largely didn’t, and… whoops! I don’t see how that makes, as you would have it, a very good argument in general for the idea that, yep, we were right not to have tried! That’s true, but Bush (and John McCain, among others) were the ones complaining! And Congress (well, the rest of it) ignored them. And the plain fact was that Bush had a lot of other problems to deal with. > [@elucidator](#): > > And finally, the cherry atop the turd sundae: deregulation. No rules. Make it up as you go along. Want to sell insurance on investments? Don’t much like the idea of setting aside money to cover if Something Goes Terribly, Terribly Wrong? Well, then, don’t sell “insurance”, sell “credit swaps”! Besides, everybody knows that the housing market will only go up! So, go ahead, suck out some equity to cover your credit card debt, no problem, next month, your house will be worth that much more anyway! Deregulation wasn’t even much applied to financi8al markets, which are one of the few are was that have a whole federal department peering over its shoulder. Deregulation is not a magic word which means anything you like. I have already mentioned that the Glass-Steagal Act did not have anything to do with CDO’s, and that the key conflict of interest already existed. I strongly suspect you don’t know how much of a problem the old regulatory scheme was, anyway. Probably most of the wealth we enjoy today exists only because deregulation in the early 80’s. So, can you point out what deregulation you speifically have a problem with, and why, and what you think it did? Because if you cannot, then you are mindlessly repeating what some “opinion leader” tells you, and there’s no basis to even argue upon. ---
**Author:** ![Pleonast](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pleonast/32/1183_2.png) [@Pleonast](https://boards.straightdope.com/u/Pleonast)\ **Post date:** [March 4, 2009, 8:22pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/30 "2009-03-04T20:22:24Z")
> [@smiling\_bandit](#): > > Secondly, the problem was that nobody _realized_ there was a problem. Sure, it looks obvious in hindsight, but at the time almost nobody (and certainly nobody in government) expected the crash. They were all busy making the bubble bigger, and nobody really understood the CDO’s or even knew _how_ to regulate them. It was very clear to anyone (who was not blinkered by their own economic interests) who looked at historical housing prices that we were in a housing bubble. The surprise, from my point of view, was how over-invested the financial industry was in mortgage and their derivatives. It’s a complete failure of company management, accounting standards, and regulatory oversight (or lack of) that corporations did not consider what would happen if housing prices went down (or even simply stagnated). With knowledge of the unsustainably high housing prices and the degree of investment in them, the crash should not have been a surprise. ---
**Author:** ![brazil84](https://avatars.discourse-cdn.com/v4/letter/b/8491ac/32.png) [@brazil84](https://boards.straightdope.com/u/brazil84)\ **Post date:** [March 4, 2009, 9:06pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/31 "2009-03-04T21:06:01Z")
> [@smiling\_bandit](#): > > Deregulation is not particularly at fault here. Not only are the financial markets highly regulated anyway, but the specific problem was one that Congresscritters encouraged. They wanted cheap mortgages any way they could. I don’t feel a lot of sympathy for the mortgage companies, but everyone wanted what happened to happen. They just didn’t think about the consequences of their wants, and the roots of this go back two decades. I think this is probably part of it. Steve Sailer had some interesting thoughts on the subject: > [@](#): > > But let’s think about the Housing Bubble from a more general standpoint for a moment. Is it terribly likely that a disaster that long gestated and then ran amok in plain sight for over three years (from 2004 into early 2007) would turn out to be overwhelmingly the fault of a single party or ideology? > > Why wouldn’t the opposition have sounded the alarm? Don’t the Republicans and Democrats, as well as the free marketers and the leftists, all have well-oiled publicity machines for pointing out the shortcomings of their enemies? > > Isn’t it more plausible that a vast, slow-motion catastrophe would be the result of a noncontroversial bipartisan consensus? > > In particular, the more everyone agrees that dissent on a particular topic is unspeakably evil, if not unthinkably unimaginable, the more likely the country is to stumble over exactly that blind spot. ---
**Author:** ![Mosier](https://avatars.discourse-cdn.com/v4/letter/m/7ea924/32.png) [@Mosier](https://boards.straightdope.com/u/Mosier)\ **Post date:** [March 4, 2009, 9:51pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/32 "2009-03-04T21:51:56Z")
> [@Sage\_Rat](#): > > In total, the economy mostly began returning on its own. When the mortgage crisis plus Detroit crumble came into effect, he was pretty much a lame duck. The leadership for dealing with these came from the legislative branch and was hence not terribly pointed nor timely. What in the world are you talking about? W waited exactly one day after the legislative branch decided not to hand out money to banks before he handed out the money to banks, himself. You can accuse W of a lot of things, but “not acting in a timely fashion” regarding the current economic crisis is absolutely not one of them. ---
**Author:** ![Mosier](https://avatars.discourse-cdn.com/v4/letter/m/7ea924/32.png) [@Mosier](https://boards.straightdope.com/u/Mosier)\ **Post date:** [March 4, 2009, 9:56pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/33 "2009-03-04T21:56:12Z")
> [@brazil84](#): > > I think this is probably part of it. Steve Sailer had some interesting thoughts on the subject: From what I’ve read, W did sound an alarm while Republicans still controlled the house and senate, but nobody really listened. The fault of a huge financial crisis can absolutely lay disproportionately on one political party or group of people. Deregulated lending was responsible for the housing bubble, and support for deregulated lending began with Reagan and was more vigorously supported by George W. ---
**Author:** ![China\_Guy](https://avatars.discourse-cdn.com/v4/letter/c/779978/32.png) [@China\_Guy](https://boards.straightdope.com/u/China_Guy)\ **Post date:** [March 4, 2009, 10:14pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/34 "2009-03-04T22:14:48Z")
> [@ShibbOleth](#): > > Except: > > - source Wikipedia article on the Glass Steagall Acts. > > Assuming the above is true, it’s sort of tough to lay this at Clinton’s feet, unless he actively lobbied Congress to repeal the Act. Ahhh, point taken. It happened on Clinton’s watch but as you said this wasn’t anything Clinton seemed to proactively push for (and probably the opposite). ---
**Author:** ![Robot\_Arm](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/robot_arm/32/18280_2.png) [@Robot\_Arm](https://boards.straightdope.com/u/Robot_Arm)\ **Post date:** [March 4, 2009, 10:17pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/35 "2009-03-04T22:17:21Z")
> [@Mosier](#): > > The fault of a huge financial crisis can absolutely lay disproportionately on one political party or group of people. Perhaps Sailer was trying to be bipartisan. ---
**Author:** ![brazil84](https://avatars.discourse-cdn.com/v4/letter/b/8491ac/32.png) [@brazil84](https://boards.straightdope.com/u/brazil84)\ **Post date:** [March 4, 2009, 10:35pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/36 "2009-03-04T22:35:55Z")
> [@Mosier](#): > > From what I’ve read, W did sound an alarm while Republicans still controlled the house and senate, but nobody really listened. If you say so. > [@](#): > > The fault of a huge financial crisis can absolutely lay disproportionately on one political party or group of people. Deregulated lending was responsible for the housing bubble, and support for deregulated lending began with Reagan and was more vigorously supported by George W. Have you seen [this video](http://www.dailymotion.com/video/x6w3i4_2004-dems-refuse-to-reform-freddie_news)? I especially like the part where Rep. Waters (D-Cal.) sings the praises of no money down loans. ---
**Author:** ![Mosier](https://avatars.discourse-cdn.com/v4/letter/m/7ea924/32.png) [@Mosier](https://boards.straightdope.com/u/Mosier)\ **Post date:** [March 4, 2009, 11:22pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/37 "2009-03-04T23:22:19Z")
> [@brazil84](#): > > If you say so. > > Have you seen [this video](http://www.dailymotion.com/video/x6w3i4_2004-dems-refuse-to-reform-freddie_news)? > > I especially like the part where Rep. Waters (D-Cal.) sings the praises of no money down loans. I know you think that you have proved something, but you haven’t. Even today Republicans sing the praises of deregulation, and the people who claim to be Libertarian but vote Republican march in line with them. The Democrats are the party that can be counted on to consistently oppose deregulation, or at least be less likely to embrace it. ---
**Author:** ![brazil84](https://avatars.discourse-cdn.com/v4/letter/b/8491ac/32.png) [@brazil84](https://boards.straightdope.com/u/brazil84)\ **Post date:** [March 4, 2009, 11:32pm UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/38 "2009-03-04T23:32:13Z")
> [@Mosier](#): > > I know you think that you have proved something, but you haven’t. Even today Republicans sing the praises of deregulation, and the people who claim to be Libertarian but vote Republican march in line with them. The Democrats are the party that can be counted on to consistently oppose deregulation, or at least be less likely to embrace it. I’m not sure what your point is. Do you agree that the financial crisis was caused in some significant part by the making of foolish mortgage loans? Do you agree that Freddie Mac and Fannie Mae played a significant role in this process by providing a market for and legitimizing these loans? Do you agree that a few years before the crisis hit, many democrats were defending Freddie Mac and Fannie Mae’s policies? ---
**Author:** ![Mk\_VII](https://avatars.discourse-cdn.com/v4/letter/m/5f9b8f/32.png) [@Mk\_VII](https://boards.straightdope.com/u/Mk_VII)\ **Post date:** [March 5, 2009, 12:32am UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/39 "2009-03-05T00:32:37Z")
Here they are blaming Margaret Thatcher for deregulating the City of London, thus prompting the repeal of Glass-Steagall to enable New York to compete. ---
**Author:** ![billfish678](https://avatars.discourse-cdn.com/v4/letter/b/7bcc69/32.png) [@billfish678](https://boards.straightdope.com/u/billfish678)\ **Post date:** [March 5, 2009, 1:03am UTC](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249/40 "2009-03-05T01:03:20Z")
Well, one could always make this argument. He either didnt fix what was coming/happening and or made it worse. However, who started the ball rolling in the first place? [Previous page](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249.md?page=1) [Next page](https://boards.straightdope.com/t/is-george-w-really-to-blame-for-our-economic-situation/488249.md?page=3)