Like Festivus, no crisis is complete with an airing of grievances. WSJ offers its take on the blame game:

At bottom are two strong currents. From the Republican president to urban Democratic congressmen, homeownership was pushed as an overriding and unquestioned goal. And many significant attempts at regulation were obstructed by the prevailing belief that the economy did best when financial markets operated as freely as possible.

The Bush administration coupled cheerleading for homeownership with pressure on government-sponsored mortgage lenders Fannie Mae and Freddie Mac to provide funding for riskier mortgages. Both Democrats and Republicans stood by as Fannie and Freddie invested heavily in securities backed by subprime loans...

And at the Federal Reserve, Chairman Alan Greenspan, revered by both parties for his economic management, resisted using the Fed's authority to more aggressively regulate lender behavior.

The blame spreads beyond Washington, to state capitals. In California, home to most of the country's subprime lenders, Democratic state lawmakers didn't support laws that would have imposed tougher regulations on a prized local industry. Politicians of all stripes cheered on the lower interest rates that sparked the boom in housing and excesses in credit.

Of course consumers and lenders bear responsibility, too, but this is an article about pols and regulators.

I think Greenspan and corporate rule disguised as free-market philosophy will be remembered as major culprits. The Bush administration bears its share of blame, along with a host of other players across party lines and levels of government.

Our fair state, thanks to the likes of Martin Eakes and Brad Miller, comes off looking pretty good:

In 1999, Democrats, inspired by a groundbreaking antipredatory lending law in North Carolina, sought a federal equivalent...Republicans, who controlled Congress, blocked the antipredatory legislation, arguing it would interfere with legitimate lending.

...From 2000 on, Democrats continued to introduce bills aimed at safeguarding against alleged predatory lending. In 2005, Rep. Brad Miller of North Carolina and two other Democrats introduced one such bill...Barney Frank, then a senior Democrat and a co-sponsor of the bill, says while Mr. Bachus was cooperative, the Republican house leadership didn't want any such bill reaching the floor.

Comments

[Spag]

Who controls Congress right now?

[JAT]

From the early 90s on it was clear that the CRA was being used to compel banks like BofA and First Union who wanted to grow via mergers, to make below-market loans to "underserved" populations. Everyone knew this, applauded it, and expanded it.

[Laura James]

We need more regulation -- not less. Regulation is good for industry of all kinds, because it fosters consumer trust. How long did it take you all to start buying spinach or Taco Bell, again after the E.coli outbreak last year? Personally, I never ever buy ground beef (a friend used to inspect grocery stores for one of N.C.s county health depts., and would find maggots in the grinders) Of course the neocon fanatics would say the solution to that problem is to stop inspecting and stop tracking violations, and stop reporting them, so that consumers will never know what they're eating --or what makes them sick!

We need to dump the deregulation fanatics that exist in BOTH parties. The banking industry and Wall St. hedge fund managers squawked and kicked like two-year-old infants everytime someone suggested reforming the subprime industry in recent years -- and the whores that make up our Congress these days dutifully looked the other way, in exchange for campaign cash -- just as they do whenever someone suggests reforming the health care crisis. So America continues to rot from within. Because Congress blocks every attempt at reform.

Progressives need to work together to dump the Republicans that exist in BOTH parties -- starting with Hillary Clinton, Joe Lieberman, John Kerry and even Brad Miller, and replace them with intelligent, solutions-oriented progressive candidates who will work for equality and equal opportunity. Congress won't fix anything until voters start growing up, stop believing the FOX and Rush Limbaugh propaganda/paranoia networks, and use their rational faculties to solve problems.

[David Boyd]

How come there were maggots in the grinders when the grocery stores were being regulated by the county's health department?

[Anthony]

Sam,

The Democrats control congress now. And Brad Miller introduced a similar bill last year, which has passed in the House and is presumably in the Senate. So, they're working on it, if that's what you're asking.