E-Mail to my mom
During the next couple weeks I am finishing up a book manuscript that I need to get out to some colleagues for review. Thus, I’m taking a bit of a shortcut on this edition of Woodwell on the World, and simply relaying an e-mail I wrote to Mrs. Woodwell, a.k.a. my mom.
My parents live in a very Republican world, and my mother is one of those who receives lots of those questionably factual, mostly written in caps, anti-Obama chain e-mails from her friends. When she sends them to me, I mostly go on http://www.snopes.com, figure out what’s not true about them, and report back to her with the results. I think she’s only ever sent me one (out of several dozen) that wasn’t deemed at least mostly false.
I couldn’t find a response her last chain e-mail on snopes.com, so I wrote my own. What follows is the chain e-mail she received, and my response.
THE CHAIN EMAIL
This tells the story, why Bush was so bad at the end of his term.
Don’t just skim over this, read it slowly and let it sink in. If in doubt, check it out.
The day the democrats took over was not January 22nd 2009, it was actually January 3rd 2007 the day the Democrats took over the House of Representatives and the Senate, at the very start of the 110th Congress.
The Democrat Party controlled a majority in both chambers for the first time since the end of the 103rd Congress in 1995.
For those who are listening to the liberals propagating the fallacy that everything is “Bush’s Fault”, think about this:
January 3rd, 2007 was the day the Democrats took over the Senate and the Congress. At the time:
The DOW Jones closed at 12,621.77
The GDP for the previous quarter was 3.5%
The Unemployment rate was 4.6%
George Bush’s Economic policies SET A RECORD of 52 STRAIGHT MONTHS of JOB GROWTH
Remember the day…
January 3rd, 2007 was the day that Barney Frank took over the House Financial Services Committee and Chris Dodd took over the Senate Banking Committee.
The economic meltdown that happened 15 months later was in what part of the economy?
BANKING AND FINANCIAL SERVICES!
Unemployment… to this CRISIS by (among MANY other things) dumping 5-6 TRILLION Dollars of toxic loans on the economy from YOUR Fannie Mae and Freddie Mac FIASCOES!
Bush asked Congress 17 TIMES to stop Fannie & Freddie – starting in 2001 because it was financially risky for the US economy.
And who took the THIRD highest pay-off from Fannie Mae AND Freddie Mac? OBAMA
And who fought against reform of Fannie and Freddie?
OBAMA and the Democrat Congress
So when someone tries to blame Bush…
REMEMBER JANUARY 3rd, 2007…. THE DAY THE DEMOCRATS TOOK OVER!”
Furthermore, the Democrats controlled the budget process for 2008 & 2009 as well as 2010 &2011.
In that first year, they had to contend with George Bush, which caused them to compromise on spending, when Bush somewhat belatedly got tough on spending increases.
For 2009 though, Nancy Pelosi & Harry Reid bypassed George Bush entirely, passing continuing resolutions to keep government running until Barack Obama could take office. At that time, they passed a massive omnibus spending bill to complete the 2009 budgets.
And where was Barack Obama during this time? He was a member of that very Congress that passed all of these massive spending bills, and he signed the omnibus bill as President to complete 2009.
If the Democrats inherited any deficit, it was the 2007 deficit, the last of the Republican budgets. That deficit was the lowest in five years, and the fourth straight decline in deficit spending. After that, Democrats in Congress took control of spending, and that includes Barack Obama, who voted for the budgets.
If Obama inherited anything, he inherited it from himself. In a nutshell, what Obama is saying is I inherited a deficit that I voted for and then I voted to expand that deficit four-fold since January 20th.
E-MAIL TO MOM
The e-mail isn’t complete loony tunes like some you’ve passed along, but it is wrong in its interpretation. In Political Science we say “correlation doesn’t equal causation” and this applies both to the Democratic Congress and to the Bush presidency. To say either is responsible for the financial crisis is silly and simplistic. The roots go back to the Clinton years really.
Here’s a good article describing some of the key figures and their mistakes:
If you read it, you’ll notice that Bill Clinton really played a key role in setting things in motion. Along with Republicans and a lot of moderate Democrats, he oversaw the repeal of a law called the Glass-Steagall Act, which was an old FDR law that oversaw the financial sector.
Without it, big banks were free to do things that were good and rational for themselves in the short term but were ticking time bombs for the economy. They developed things called Derivatives and Credit Default Swaps which allowed risky borrowers to get money at cheap rates they could profit on, while passing the risk of default off to other investors who couldn’t tell what they were getting into.
A good movie to watch if you’re interested in all this stuff is called “Inside Job”. It really lays it out in detail and it’s not too boring.
The Freddie/Fannie thing was important, but was more a consequence of something already set in motion than a cause (although, yes, in fairness, these institutions were more the creatures of Democrat than Republican support).
Anyhow, Bush did something very courageous at the end of his term by setting in motion the very necessary emergency bank bailout (TARP). Too bad everything between it and his first year dealing with 9-11 sucked.
Long story short, it’s stupid to pin the crash on either Republican or Democrats — there was enough blame to go around. However, the crazy part is that Republicans want to go right back to the old system of deregulated financial markets — another blindly ideological insane view of a party that belongs in the asylum these days.
Hope that helped. Maybe I’ll use some for my next blog — Love, your son.