Paul Krugman calls out GOP on their phony account of the financial crisis...

[Wetzelbill]

Also of hilarious note, he appeared on "This Week" today and he refers to it as "This Weak." -WB

:rofl:

Fannie Freddie Phony

So I was listening to Arnold Schwarzenegger before doing the This Weak round table, and he was mostly making sense — except for one thing. He asserted, as a simple matter of fact, that “government created the housing bubble”, because Fannie and Freddie made all these loans to people who couldn’t afford to pay them.

This is utterly false. Fannie/Freddie did some bad things, and did, it turns out, get to some extent into subprime. But thanks to the accounting scandals, they were actually withdrawing from the market during the height of the housing bubble — the vast majority of the loans now going bad came from the private sector.

Yet it’s now clear that the phony account of the crisis — that it’s all due to Fannie, Freddie, and nasty liberals forcing poor Angelo Mozilo to make loans to Those People — is setting in as Republican orthodoxy, part of what you have to believe to be a respectable member of the party.


http://krugman.blogs.nytimes.com/2008/11/16/fannie-freddie-phony/#respond

[tabasco]

1. The gullibility and stupidity of the typical republican voter is astounding.

They believe it's raining when their fuhrers are pissing on their head.

[Wetzelbill]

3. and they open up their mouths for good measure. nt

[BrklynLiberal]

2. Krugman is so great...without even trying.

[Wetzelbill]

4. he's fantastic

I like how he's an academic, but he's snarky, lol.

[Juche]

5. At least Krugman calls them on their race baiting

This is an attempt to blame 'those people' (latinos & blacks) for the housing crisis. This needs to be hammered home, that the GOP base (white, rural christians) want to blame poor blacks & latinos for this crisis.

[Wetzelbill]

7. it's interesting how he's so blunt like that

He points out the obvious and does it with sarcastic disdain. Meanwhile, everybody else dances around it. I sometimes wonder how he even got a gig writing a column for the NY Times, although they made him stop calling Bush an outright liar, they even pressured him for doing it during the 2000 campaign. I like Paul, he just comes out and says what he thinks. Well "writes" it, which is even more impressive.

[applegrove]

6. Thank god for Krugman. The conservative neocon phony narrative

cannot be left untouched. We know what they are all about now. Good for Krugman for calling them out.

[Wetzelbill]

it's so ludicrous

Especially since Countrywide, for example, forced Fannie and Freddie to buy up their most risky loans. The private sector had them by the balls, sure they made their mistakes, but the GOP narrative is complete BS.

[applegrove]

11. neocon narrative cannot allow for free markets to be the culprit. They

want their free markets. No matter who it hurts. So they spew these lies and convince a whole bunch of the GOP base that it wasn't lack of regulations that caused the bubble & the subprime mess. We have stricter regulations in Canada and we don't have a subprime mess at all. Our economy is affected because the whole world is in recession but we didn't allow investment firms to run around unregulated. So we are not hurting nearly as much as the USA is. In fact our banking system was just rated as the greatest in the world.

[Swamp Rat]

8. k&r

[Wetzelbill]

9. I should nominate this for a Visual Swamp Rat.

[Swamp Rat]

10. You're too kind

:hi::hug:

[Mayberry Machiavelli]

14. Heh, I love Star Wars analogies. When I was watching the election returns, after VA was called and

I was waiting for the West Coast results to come down like the Hammer of Justice and put McCain and Palin out of our misery, I kept thinking "a small thermal exhaust port..." and envisioning Karl Rove or Steve Schmidt saying "EVACUATE?! In our moment of triumph? I think you overestimate their chances!"

[Swamp Rat]

15. LOL!

The Dark Side of the Force is strong in Palin. Don't underestimate her. :D

[vanderBeth]

12. Bwahahaha

I love Krugman

[Sophree]

13. I love Paul Krugman, too.

I wish that I had more copies of "The Great Unraveling" so that I could hand them out to all the people who tell me that "the economy was just fine until recently" or "no one could have foreseen the economic collapse..." etc.

He's brilliant.

[Wetzelbill]

16. I had some guy on youtube trying to tell me today

That Krugman's ideas are dangerous and he doesn't have any solutions for the crisis, yadda yadda yadda. I told him to read 8 years of columns, a year of blog posts, and his two books and then figure it out. Some people, jeez.

[Sophree]

17. I'm no economist,

But pretty much anyone, if they would just read- like you said- his columns, books, etc., he makes difficult Economic Theory and complex economic problems easy to understand and has plenty of real solutions- has had them for years. The problems wouldn't be so bad if someone had actually done what he's been suggesting. :argh:

[Wetzelbill]

19. He's very good at taking something complex

and simplifying it for a layperson. Paul is one of the people who had Bush pegged long ago, I wish people listened more.

[exboyfil]

22. Actually many fiscal conservatives were alarmed by bad underwriting as well

Peter Schiff is one example.

To lay the blame for the credit crisis on CRA is ridiculous. Most of the blame lies with the wizards of Wall Street who allowed poor lending practices to be disguised and the bond ratings agencies who facilitated this nightmare with AAA ratings for junk. Monetary policy also had a hand in it as cheap dollars kept looking for a lending home.

Freddie and Fannie were mismanaged and should never have existed as GSEs. Either fish or fowl but not both (a government agency or a private company). Good underwriting practices should apply to everyone regardless of where they live or how much money they make. You do no favor to someone by getting them into a loan which they cannot service. On the flip side individuals need to take ownership for their own lives and not just blame the evil mortgage company for selling them what they wanted. I believe that some fraud did occur and unsophisticated buyers were taken advantage of. Cases of fraud should be prosecuted to the full extent of the law. A way to deal with unsophisticated buyers is with stringent underwriting practices. Education is also useful for these buyers, and that education should start at home and be supplemented by the public school. Having folks read and listen to individuals like Michelle Singletary and Dave Ramsey also helps.

Bundling loans helps borrowers to get lower overall rates, but, after this blow up, it appears to me the downside is greater than the upside. Decoupling the lender from the broker is also a big problem. Somehow broker compensation needs to be tied to ability to actually service the loan.

[mrreowwr_kittty]

18. K and R. nt

[TexasObserver]

20. Thanks. Paul is an insightful with good calls on GOP economics.

I think he's of most service outside, not inside, the government. He's a reliable critic.

He's right about Arnold and the GOP cover story for the bailout. I've already heard it, and they say it like they believe it. ACORN made Democrats give home loans to broke people who couldn't pay them, and that brought down the financial system in the world. That's their story, and they're sticking to it.

[Wetzelbill]

21. it's crazy, but the GOP is a party of skilled mythmakers and propagandists

That people actually buy that stuff is beyond me.

[pacalo]

23. Funny that he called it "The Weak" because what I was actually thinking as I saw the clip

was, here we have a Nobel Laureate on economics on the panel, & every pundit & newspaper columnist is talking about the financial crisis around him, as if they are the smartest ones in the room!

I could care less what Sam Donaldson & Cokie Roberts had to say -- I wanted to hear more from Krugman!

When the pundits do the majority of the talking, what they are actually saying to the viewers is, "This is what we want you to think."