Blame Bush? Overview of the housing bubbble

“The president blames the Bush administration and Republicans for this state of affairs. But as we have seen, George W. Bush surely wasn’t president in 1977, when the original CRA was passed.

Bush wasn’t president when Obama himself was pushing and suing to get more cash into the hands of marginally qualified purchasers.

Bush wasn’t president during the thirty or so years that our public schools failed to educate young people as to the consequences of borrowing more than they could repay.

Bush wasn’t president when states, municipalities, and school districts offered unsustainable wages and fringes to public-employee unions, assuming that the increases in real estate taxes would make for an endless stream of revenue.

So whom can Obama blame? Well, some of the most destructive avalanches have begun with the dropping of a tiny pebble that unsettles the slope of a mountain. Barack Obama dropped such a pebble in 1995 when he sued Citibank in Chicago.”

When the need to simplify meets the need to rationalize, all sorts of distortions can occur. Jim Yardley provides an overview of the history of the housing bubble and its nature in So Obama Inherited a Mess, Did He? From Whom? that illustrates the fact that national and global financial messes are seldom simple and have many fathers.

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