you forgot something.Why we are where we are today:
1999 - Bill Clinton put CRA on steroids pushing Fannie Mae and Freddie Mac to increase number of sub-prime loans.
1999 - New York Times published an article “Fannie Mae Eases Credit to Aid Mortgage Lending” warning of coming crisis due to lax lending policies of the Clinton administration.
2003 - White House called Fannie and Freddie a “systemic risk” and Bush administration pushed Congress to enact new regulations.
2003 - Rep. Barney Frank said Fannie and Freddie are “not in a crisis,” bashed Republican-sponsored regulation legislation.
2005 - Federal Reserve Chairman Alan Greenspan voiced warning over F&F accounting, saying,“We are placing the total financial system of the future at a substantial risk.”
2005 - Sen. Charles Schumer said F&F “over the years have done an incredibly good job and are an intrinsic part of making America the best-housed people in the world.”
2006 - Sen. John McCain again called for reform of regulatory structure governing F&F. And again Democrats blocked reform legislation.
2008 - The housing market collapsed.
2008-Present - Democrats blamed the Republicans.
Bush drive for home ownership fueled housing bubble
"There is no question we did not recognize the severity of the problems," said Al Hubbard, Bush's former chief economic adviser, who left the White House in December 2007. "Had we, we would have attacked them."
Looking back, Keith Hennessey, Bush's current chief economic adviser, said he and his colleagues had done the best they could "with the information we had at the time." But Hennessey did say he regretted that the administration had not paid more heed to the dangers of easy lending practices.
And both Paulson and his predecessor, John Snow, say the housing push went too far.
"The Bush administration took a lot of pride that home ownership had reached historic highs," Snow said during an interview. "But what we forgot in the process was that it has to be done in the context of people being able to afford their house. We now realize there was a high cost."
For much of the Bush presidency, the White House was preoccupied by terrorism and war; on the economic front, its pressing concerns were cutting taxes and privatizing Social Security, a government retirement and disability benefits program. The housing market was a bright spot: Ever-rising home values kept the economy humming, as owners drew down on their equity to buy consumer goods and pack their children off to college.
Lawrence Lindsay, Bush's first chief economic adviser, said there was little impetus to raise alarms about the proliferation of easy credit that was helping Bush meet housing goals.
"No one wanted to stop that bubble," Lindsay said. "It would have conflicted with the president's own policies."