But the facts, for those of you who are interested, paint a different picture, one based in reality. David Young, a Constitutional scholar, on his blog On Second Opinion, could not have summarized it better:
The current economic situation is largely the result of two separate problems. The first is government policy that has forced lending institutions to loan money for homes to those who cannot actually repay the loans. Due to the government's policy requiring unsound loans for housing, many people have purchased homes much more expensive than they would otherwise have bought. Others have purchased more than a home, they have engaged in extensive speculation in the housing market, buying up houses, especially in a few parts of the country, to make extensive profits.
The second problem involves some of the largest financial institutions that have engaged in what amounts to gambling or blatant speculation through the medium of credit default swaps, betting on the likelihood of various large
businesses failing. Because of the failure of Freddie and Fanny due to unsound loans caused by equally unsound public policy, the failure of various major financial institutions has become likely, and as a result of a possible string of failures, literally trillions of dollars may be owed to those speculating in credit default swaps.
The insanity of the whole affair is that the people who caused this -- both government and private -- are the ones who are attempting to fix the problem. Does this make sense to you?
Young writes: "Apparently it is simply the result of politicians ignoring the power actually given them in the U.S. Constitution and doing whatever they please whenever they want."
Victor Davis Hanson is also worth reading on these -- indeed, most -- issues. (In fact, if you're not a regular reader of his columns and books, you should become one now.)
We had a 9/11 Commission; we formed the Baker-Hamilton Commission on Iraq (never mind the utility of the conclusions). So let us try a bipartisan investigatory commission on the autumn financial meltdown. Thus far the mainstream media narrative is a reductive “Bush did it.” But let us examine past bundling of subprime mortgages, and derivatives, and who introduced more regulation of banks, who opposed it; who tried to restrain Freddie and Fannie, who fought that tooth and nail, what the SEC did and did not do — and why. Let us collate all the campaign contributions from the failed banks, Madoff, the entire open sewer of politics and high finance, and then let those of the commission, both Democrat and Republican, issue a white paper on when, why, and how it all went down.
In the meantime, let's just keep doing the same thing, and hope for different results.
This are truly insane times.