Failed Economic Policies of President Bush?

It has been claimed more than once that the current recession is due to the failed economic policies of President George W. Bush.

But think back to 2006. The economy wasn’t doing so terribly then, though things were supposedly “slowing down”. President Bush’s biggest problem was not his management of the economy (although that’s not even the President’s job, anyway). The problem with him was the War in Iraq. I also oppose the War in Iraq and that is the reason why I think President Bush was harmful to this country. I don’t have a problem with his handling of the economy, however. Certainly it was better than the president before him.

What happened in 2006 were the United States midterm elections.

“All United States House of Representatives seats and one third of the United States Senate seats were contested in this election, as well as 36 state governorships, many state legislatures, four territorial legislatures and many state and local races. The election resulted in a sweeping victory for the Democratic Party which captured the House of Representatives, the Senate, and a majority of governorships and state legislatures from the Republican Party.”

The economic recession became reality in the 2 years after their victory.

Not a single Democrat senator voted against the “economic stimulus”, an action which certainly did far more harm to the economy than good. Is it any wonder that the economy has become so terrible since the Democratic victories of 2006?

Congress is far more responsible for the economic downturn than the President. We’ll see if Congress is smart enough to pass bill H.R. 1207, the Federal Reserve Transparency Act, which is being debated right now.

2 Responses to “Failed Economic Policies of President Bush?”

  1. Michael says:

    In my mind, the major catalyst to economic disaster began and continued through several administrations. That is the push for “Housing Affordability”.

    1) Government intervention pushed banks to loosen their criteria in order to make home loans accessible to more people. people who a fiscally conservative mindset would say “NO WAY!” … these people are not good credit risk … they can’t pay back the loan. If a bank did not lend the money, they were threatened with intense scrutiny for discrimination in lending practices.

    2) Semi-government agencies, Fannie and Freddie, tells the bank – give us those high-risk loans. It’s OK, we’ll insure them – you don’t need to worry. So with guarantees from an agency backed by the Federal Government to buy back the loans, the risk of these sub-prime loans was shifted away from the banks.

    3) The housing market boomed because now you have artificially increase demand. People who couldn’t afford a home and couldn’t qualify for loan were able to buy houses and the Federal Government drop the interest rates which only serve to feed this frenzy.

    When there’s money to be made. A fiscally conservative bank looks like a fool. How long do you last if other banks make huge profits selling sub-prime loans and you don’t. Fannie and Freddie are there to buy your loans and guarantee them. If you hesitate, the government will breathe down your neck and accuse you of discrimination. With both a carrot and a stick plus some personal self-interest “greed” most people will just go with the flow.

    Greed then takes over in the form of people willing to lie on their loan apps to get the easy money expecting home prices to grow 20%- 50% a year. Banks and mortgage brokers stand to make “Lots & Lots” of money. Wall street puts together fancy derivatives and package mortgages into bundles for sale on financial markets and the Insurance companies insure the packages to shift the risk. The Merry – Go – Round throw off money in all directions and everyone is HAPPY till it stops.

    Now we Tax-Payers are left with the costs of paying those debts incurred when inflated values return to the real world. The bill has come for the equity taken out of paper gains on home values that was spent on personal indulgences.

    Unfortunately, many of us have not awaken to the reality that the SIZE of the “Economic Stimulus” with all the attached “pork” is repeating the same old mistakes. Spending something that isn’t really there will only incur enormously larger debts to be paid in the future.

  2. WandaLou says:

    Dear Elliot, It is unclear how to get an email to you. I read one of your articles and am in need of help. Can you email me please? Thank you, WandaLou

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