Bill Clinton's Role in the Mortgage Crisis

[democracy1st]

Bill Clinton's Role in the Mortgage Crisis by Ralph Brauer

Many Democrats wish Bill Clinton still occupied the White House. However, before you put him in Mt. Rushmore, you might want to investigate his role in the mortgage foreclosure crisis.

The chief aim of what I have termed the Republican Counterrevolution has always been to roll back the New Deal. Anti-gov'ment rhetoric hides this as surely as states' rights hid racist segregation. Of all the New Deal legislation the GOP has sought to overturn, one that has always been at or near the top of the list is the Glass-Steagall Act. Ironically, a Democratic president repealed this for them.


Billionaire Sanford I. Weill, who according to Louis Uchitelle made "Citigroup into the most powerful financial institution since the House of Morgan a century ago," has what I call the Wall of Me leading to his office, which he has decorated with tributes to him, including a dozen framed magazine covers. A major trophy is the pen Bill Clinton used to sign the repeal of the Glass-Steagall Act, a move which allowed Weill to create Citigroup. Fittingly, Citigroup is a major contributor to guess which current Democratic Presidential candidate


When Bill Clinton gave that pen to Sanford Weill, it symbolized the ending of the twentieth century Democratic Party that had created the New Deal. Although the 1999 law did not repeal all of the banking Act of 1933, retaining the FDIC, it did once again allow banks to enter the securities business, becoming what some term "whole banks."

The repeal of one of the most important pieces of legislation in this nation's history came about as a result of another Clinton "triangulation," the wobbling attempt to find the middle of the road that has somehow managed to pass for a philosophy with many Democrats for over two decades. As former Clinton former campaign Richard Morris once described it, you move a little to the left, a little to the right. I'd love to hear Clinton give that explanation to a foreclosed home owner today.

With the stroke of a pen, Bill Clinton ended an era that stretched back to William Jennings Bryan and Woodrow Wilson and reached fruition with FDR and Harry Truman. As he signed his name, in the whorls and dots of his pen strokes William Jefferson Clinton was also symbolically signing the death warrant of Liberal America and its core belief in the level playing field that had guided the Democratic Party. But it was the gift of the pen to Sanford Weill and its assuming an honored place on the Wall of Me that rubbed salt in the wound.


And the current crop of politicians? Look closely at their donor lists, which I detailed in the series "Follow the Money."(see link) Then wonder why no moderator or other candidate has asked Hillary Clinton if she supports her husband's repeal of Glass-Steagall? Ask the other candidates if they support Bill Clinton's move.

http://www.progressivehistorians.com/2007/11/bill-clintons-role-in-mortgage-crisis.html

[Selatius]

1. "middle of the road" is not a philosophy. It is tepid, pale resistance in the face of attack.

You win no wars with timid leaders flying pale colors that run.

[Califooyah Operative]

5. It's more than a response.

It's a compromise for the benefit of corporate donors. That's the third way. We're tricked into thinking new democrats are somehow 'centrist' when in fact they're corporate sell-outs. All they're doing is selling out labor, the environment, the grassroots, progressives, etc.

[elleng]

2. Glass Steagall

was pending dissolution well before bill clinton.

http://www.pbs.org/wgbh/pages/frontline/shows/wallstreet/weill/demise.html

[sandnsea]

4. Clinton signed it

I remember being shocked at the time. Everything we've got going wrong now, Clinton mistakenly laid the groundwork for. I don't think he intended these consequences, but he hasn't stood up and admitted how wrong he was about so many things either. We need to do something different and they aren't it.

[pnorman]

6. That PBS timeline is just what I'd been loking for! THANKS!

n/t

pnorman

[KoKo]

12. Quote: "After 12 attempts in 25 years, Congress (and Clinton) finall repeals Glass-Steagall.."

After 12 attempts in 25 years, Congress finally repeals Glass-Steagall, rewarding financial companies for more than 20 years and $300 million worth of lobbying efforts. Supporters hail the change as the long-overdue demise of a Depression-era relic.

On Oct. 21, with the House-Senate conference committee deadlocked after marathon negotiations, the main sticking point is partisan bickering over the bill's effect on the Community Reinvestment Act, which sets rules for lending to poor communities. Sandy Weill calls President Clinton in the evening to try to break the deadlock after Senator Phil Gramm, chairman of the Banking Committee, warned Citigroup lobbyist Roger Levy that Weill has to get White House moving on the bill or he would shut down the House-Senate conference. Serious negotiations resume, and a deal is announced at 2:45 a.m. on Oct. 22. Whether Weill made any difference in precipitating a deal is unclear.

On Oct. 22, Weill and John Reed issue a statement congratulating Congress and President Clinton, including 19 administration officials and lawmakers by name. The House and Senate approve a final version of the bill on Nov. 4, and Clinton signs it into law later that month.

Just days after the administration (including the Treasury Department) agrees to support the repeal, Treasury Secretary Robert Rubin, the former co-chairman of a major Wall Street investment bank, Goldman Sachs, raises eyebrows by accepting a top job at Citigroup as Weill's chief lieutenant. The previous year, Weill had called Secretary Rubin to give him advance notice of the upcoming merger announcement. When Weill told Rubin he had some important news, the secretary reportedly quipped, "You're buying the government?"

[Selatius]

13. Now THAT, my friends, is how REAL power is exercised in America.

Is it any question who really exercises power in America?

[elleng]

14. No doubt.

And notice how long it took. They're willing and able to WAIT while they play the 'game.'

And THEN Dems accuse their own, when its been a Rep dream and plan for ages.

[sandnsea]

3. Obama has answered it

MR. HUNT: But was the repeal of Glass-Steagall a mistake?

SEN. OBAMA: Well, Glass-Steagall I think, is an example of where maybe we didn't entirely think it through. You had $300 million worth of lobbying done by the financial institutions. They wanted to compete because they were seeing big profits in some of these areas. It wasn't necessarily the best thing to assure that U.S. consumers were protected or that the financial markets remained stable and sound.

MR. HUNT: Well, should you restore Glass-Steagall then?

SEN. OBAMA: Well, no. The argument is not to go back to the regulatory framework of the 1930's because, as I said, the financial markets have changed substantially. The question is, how do we build new regulatory systems that are flexible, that reflect new realities, that aren't going to put undue constraints on innovation in the financial markets, but nevertheless will encourage the transparency and accountability that we need and will maintain trust between investors and counterparties and the banks so that you don't see what's happening right now, which is a complete lock-up of the credit system. It's, as I think has been noted by a number of people, this is sort of a 21st century version of a bank run. And what happened when there were runs on banks in the - during the Depression era is that Congress moved in with FDIC and Glass-Stiegel and other laws to assure that confidence would be maintained and excessive risks could be curbed and that investors or depositors could have confidence.

We need a counterpart for that, but it doesn't mean just looking back to the 1930's; it means creating some new mechanisms. And that's something that I want to convene and make happen as president of the United States.

http://www.realclearpolitics.com/articles/2008/03/obama_on_political_capital_wit.html

[Wednesdays]

7. Right...it's all the Mighty Clenis' fault

It's Clinton's fault! :spank: It's Clinton's fault! :spank: It's Clinton's fault! :spank: It's Clinton's fault! :spank:

[democracy1st]

8. So the rightwing repealed Glass Steagall ?

Regulations aren't cheap

[Wednesdays]

9. Who wrote the repeal bill? I forget

Refresh my memory.

[Wednesdays]

10. Oh, and while you're at it...

Bush and the Republicans controlled the Presidency, the House, and the Senate from 2001 until 2007. Since the repeal of Glass Steagall was so horrific, and they knew it, I'm sure Bush and congress were working overtime to re-instate it. They were working hard to re-instate it, weren't they?

You might provide me with some links to the above, 'cause I'm coming up empty. :shrug:

[democracy1st]

11. you're coming up empty alright

[bluesmail]

15. yes, Clinton signed it

so he's ultimately responsible

[FrenchieCat]

16. That's how it works where I come from as well.......

you signed it, you own it.....or at least should own UP to it.

[workoholic]

17. Bill Clinton made the Challenger blow up, and he caused 9-11 n/t