by Dean Ralph

Created on: September 17, 2010   Last Updated: September 18, 2010

To blame either President Obama or President Bush (43) for the Country's current economic state of affairs is unjust. This meltdown was caused by neither of them. It was a slow process that, unfortunately for Bush, just happened to explode on his watch and was inherited by Obama.

The crisis was initially caused by the instability of the housing market. Instability that was allowed by Government interference in the housing market. Interference that began in 1977 when, then President Jimmy Carter signed into law the Commuity Reinvestment Act.

The Community Reinvestment Act required banks to provide the same services to all who are equally situated and equally qualified in the communities in which they operate. The Government stuck their nose into private business and required them to spend their money in certain areas if they were federally insured. The law did not require them, however, to make risky loans or tell them who to loan money to, only which areas of the community it must go.

In 1999, then President Bill Clinton expanded on the Community Reinvestment Act by requiring banks and lending institutions to lend to low and moderate income people. Soon after the expansion by Clinton, even the NY Times predicted what was to come, stating that during slow economic times, this would cause trouble for Fannie Mae, possibly even requiring a Government bailout.

In 2003 the Bush Administration tried to overhaul the regulations imposed on the housing industry by creating a new department within the Treasury to oversee the housing market. It was the Democrats sitting in Congress that blocked this plan. Democrats like Barney Frank, who was the leading Democrat on the Financial Services Committee at the time, claimed that Fannie and Freddie were stable and not facing "any kind" of financial crisis.

In 2005 legislation was introduced to help try and prevent the upcoming disaster. The Federal Housing Enterprise Regulatory Reform Act was introduced in Jan. 2005, but never even made it to a vote in the Senate before being scrapped. A few months later in 2005 the Federal Housing Refinance Act of 2005 was introduced. It was passed by the House but never considered for a vote by the Senate.

At the point of the economic meltdown, Obama was not in the White House, nor had any proposed legislation concerning the Housing Market been voted on by the Senate since his Election into Congress. So many people would argue with me that Obama has any blame in the current economic

• 1
• 2
• Next Page >>