“Since the financial meltdown, people have been asking, ‘Where was Congress? Why didn’t they see this coming? Why didn’t they provide better oversight?’ And the answer for some, including Senator Schumer, is that they were actually too busy pursuing a deregulatory agenda. Their focus was on how we have to lighten up regulation on Wall Street.”

-Barbara Roper, director of investor protection for the Consumer Federation of America


Today’s New York Times has a damning article linking Senator Chuck Schumer to many of the radical deregulatory policies that underlie much of the current crisis.

I have assessed a lot of blame for the crisis on several people — Greenspan at the top of the list, followed by several others, including President Bush. Phil Gramm was a prime sponsor of all manners of ruinous legislation — which, I hasten to add, was signed into law by one President Clinton (he sure isn’t blameless in the mess).

In the Senate, on the other side of the aisle from Gramm was Chuck Schumer. The votes and support noted by the NYT shows Schumer was not much better than Gramm:

“But in building support, he has embraced the industry’s free-market, deregulatory agenda more than almost any other Democrat in Congress, even backing some measures now blamed for contributing to the financial crisis.

Other lawmakers took the lead on efforts like deregulating the complicated financial instruments called derivatives, which are widely seen as catalysts to the crisis.

But Mr. Schumer, a member of the Banking and Finance Committees, repeatedly took other steps to protect industry players from government oversight and tougher rules, a review of his record shows. Over the years, he has also helped save financial institutions billions of dollars in higher taxes or fees.

He succeeded in limiting efforts to regulate credit-rating agencies, for example, sponsored legislation that cut fees paid by Wall Street firms to finance government oversight, pushed to allow banks to have lower capital reserves and called for the revision of regulations to make corporations’ balance sheets more transparent.”

Schumer, nicknamed the jackhammer for his fund raiser technique, apparently drank deeply of the deregulatory Kool-Aid also.

There’s a full table of the legislation he supported here: Schumer’s Stands


A Champion of Wall Street Reaps Benefits
NYT, December 13, 2008


Schumer: Cut regulations, make NY more competitive (pdf)
Schumer Letter to SEC regarding “Soft Dollars” (pdf)
Schumer co-signer on letter regarding derivatives (pdf)
Schumer to FDIC on Bank’s Capital Reserve Requirements (pdf)
Schumer to SEC on Credit Rating Agencies (pdf)
Schumer objecting to Proposed Auditing Rule (pdf)

Category: Bailouts, Corporate Management, Legal, Markets, Regulation

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

36 Responses to “NYT: Don’t Forget Shumer’s Role in the Mess”

  1. VoiceFromTheWilderness says:

    Stop me before I lobby on my own behalf, again. So the NYT that two days ago wanted us to be oh so concerned about the terribly burdens on the wealthy, is now looking to cook up some rage in the direction of NY states senior senator. hmmmm, I wonder why? The NYT that never once said anything about the housing bubble before it happened, is now putting itself in charge of the blame game, gee, I wonder why? The NYT which merrily quotes ‘economists’ (spouting nonsense) on a routine basis, thinks we all ought to blame Chuck Schumer for deregulation, hmmm, I wonder why?

    The great american con game is funded 50% or more, by blame. By scapegoating individuals for societal problems. One of the particularly effective versions is the ‘blame DC game’, where in a extravagantly wealthy people, spend vast sums of money, as well as personal time and effort to push the government into adopting positions that are advantageous to them, by simultaneously funding those they favor in private, while publicly launching a campaign to ‘blame DC’ —


    BR: Let me interrupt you right here: Its called PERSONAL RESPONSIBILITY — and its not a game. It is a matter of holding the people who caused the crisis to accounts. 1) To recover what we can from their personal, ill-gotten gains; and 2) to prevent a repeat of the same thing from happening again.

    We now return you to the previously scheduled rant:

    It’s all governments fault, get the government off the backs of the people they cry. And the ranchers in montana, and the poor white trash in south carolina, all think this means they will be ‘free’, though actually of course what it really means is that Goldman Sachs will be free, and the ranchers will be saddled up with new debt.

    When was the last time the NYT blamed a wide spread commitment to the increasing wealth of the individual at any cost and a concomitant refusal to give a shit about society? When was the last time the NYT identified a willingness by the wealthiest strata of society to manipulate the legal process and to commitment crimes in pursuit of their own personal power as a contributor to this crisis? When was the last time that the NYT’s pointed out that for ever bernie ebbers that does get caught, there are thousands of nudge-nudge wink wink fellow travellers? When was the last time that the NYT pointed out that herd mentality rules in this culture and the herd figures that if we all break the law they can’t arrest all of us?

    Any attempt by any media outlet to blame anybody is the pot calling the kettle black. The fox is guarding the hen house. The NYT has precisely zero credibility as a guardian of anything, rather has clearly long since descended into herd mentality — doing and saying whatever it’s wealthy readers and owners want it to do and say — going along to get along. They not only, as with all the other news outlets, re-cycle the expectations, beliefs, fantasies and dreams of their readers as ‘news’, but further are clearly and egregiously available for use in the manipulation of public perception by those with power.

    Any news story, at any time, should always be looked at in the context of ‘why this, why now?’ Who stands to gain from this story being taken at face value’ What it sounds like is that the Republican attack machine is gearing up to do their very best to undermine the current congress and administration.

    I can assure you of one thing: the culture of blame game will not survive — either american culture and societal organization themselves will disintegrate in the coming storm, or we will learn that after the fact blame is no substitute for knowing what the fuck is going on in the first place. Any culture that refuses to hear ‘bad news’ is a culture that cannot defend itself when its inevitable decline sets in. That americans routinely deride data about reality as ‘being negative’ proves that they are ready for the ash bin of history.

  2. DL says:

    The NY Times article doesn’t mention Fannie and Freddie. Schumer resisted efforts to rein in their risk-taking adventures. (BR: Do you have a citation for that? I don’t recall that being a Schumer issue).

    For those with the patience to wade through it, John Taylor (econ prof @ Stanford U) has an analysis of the financial crisis and the response to it:


  3. BG says:

    While we are on the topic of the media and truthfulness in reporting…check out this snippet I read a few minutes ago. People really can write just about anything whether there is a shred of truth to it or not.

    “The financial crisis drives home to other nations that “without an America that is successful financially, economically and therefore also politically, they’re not going to be successful,” said Zbigniew Brzezinski, who was national security adviser to President Jimmy Carter. “If we don’t function well, no one functions well.”

    I agree with the overall view of the article; but, obviously we are NOT success financially, economically or politically. We are literally bankrupt in all (3) categories. The fact of the matter is that we the United States of America knowingly fucked the rest of the world by selling them trillions of dollars of financial garbage. The scary part is that we may find the rest of the world has finally realized they are much better off without us and thus make future plans accordingly!

    The article gives a sense that the US has whipped the rest of the world back into line. I think the US will experience a huge backlash from what we have done to the rest of the world and will pay dearly for our sins. It is now clear that the most effective way to attack the US is financially and economically.

    Global woes pose risks, also openings for the US

  4. Everyone who blames Freddie and Fannie doesn’t understand their roles.

    They were minor cogs — it was the lenders who lowered lending standards, the wall street machine that bought the loans, and the ratings agencies who put triple AAA on them. Most of the bad loans were not securitized by Fannie / Freddie. By the time they got in to that line of business, it was way late in th cycle — 2005.

    Please try to hold the right people accoutnable!

  5. DL:
    Yeah, Schumer is a dirtbag. As a Democrat, he’s always been at the bottom of the list(along with people like Dubya) of politicians. He’ll always be a shill for Wall Street at the expense of the entire Democratic party. He’s the kind of jerk who gives a bad name to all Democrats. I wonder why Schumer isn’t a Rockefeller Republican instead.

  6. Scott F says:

    I don’t get the right wing attempts to blame Fannie and Freddie on the Democrats.

    From 1994 to 2006, the Congress was controlled by the GOP. Fannie sloshed tons of money around to both sides — including Newt Gingrich and his K-Street gang. But don’t forget, it was a Republican Congress for 2 of the last 14 years, including the entire phony housing boom era.

    Yes, it was bipartisan –b ut remember who controlled congress

    See this for more —
    How Freddie Mac halted regulatory drive

  7. James says:

    Phil Gramm was a prime sponsor of all manners of ruinous legislation — which, I hasten to add, was signed into law by one President Clinton (he sure isn’t blameless in the mess).


    Yes, Gramm-Leach-Bliley Act was a bipartisan affair. The Democrats supported the final legislation in overwhelming numbers in November of 1999:



    Bill Clinton signed it into law on November 12, 1999. Here’s what he had to say about it at the signing:

    “You heard Senator Gramm characterize this bill as a victory for freedom and free markets. And Congressman LaFalce characterized this bill as a victory for consumer protection. And both of them are right. And I have always believed that one required the other.”

    See: http://bulk.resource.org/gpo.gov/papers/1999/1999_vol2_2080.pdf

    Here’s what Chris Dodd had to say about it as recently as March 2007:

    “I am proud to have had Tom’s and the Chamber’s support on some of the most important pieces of legislation with which I have been associated. Laws like the Private Securities Litigation Reform Act; the Y2K litigation reform act; the Class Action Fairness Act; the Gramm-Leach-Bliley Act, which has helped bring our financial services sector into the 21st century; and the Terrorism Risk Insurance Act, which in the aftermath of 9/11 has played a crucial role in keeping our economy strong.”

    See: Web site: http://dodd.senate.gov/index.php?q=node/3779/print

  8. BDW says:

    Schumer represents Wall Street and nothing else. He has basically said so himself. To think that he will move for regulation now instead of bail-outs goes against his voting record. He is very much what is wrong with the current leadership within the Senate Democrats. Nothing substantial will get properly re-regulated or revamped with Schumer and the spineless Reid as the top two Dems and will seriously hamper Obama’s agenda (of course if you want the Democrats’ agenda and methods to fail, Reid and Schumer are the perfect patsies to be in power).

  9. jmborchers says:

    The last post sums it up the best. No matter who they were they were using computer models which were no good. This goes for

    Greenspan, The Credit Agencies, The Banks, and the economic advisers who help the executive branch make decisions.

  10. willid3 says:

    i am not sure why we are surprised. isn’t New York where most of the big banks and investment (or former) banks where? so he was just supporting his local constituents. that they were stupid, conniving fools doesn’t let him off the hook though. besides it was where the money was, and we know thats what drives all of the politicians. after they have to get to money to get elected, and get money to get elected.

  11. DL says:

    Below are “snippets” regarding Schumer’s protection of Fannie and Freddie.

    Available at the following website:


    Obama Ally Sen. Chuck Schumer (D-NY) Has Been A “Leading Voice For [Financial] Deregulation,” And Led Efforts To Block Reform Of Fannie And Freddie:
    Until The Current Financial Crisis, Sen. Schumer “Had Been A Leading Voice For Deregulation,” And Opposed Reducing Taxpayer Risks Associated With Fannie Mae And Freddie Mac.
    …he has opposed a bill that sought to reduce taxpayer risk in the event of a housing market slowdown by requiring Freddie Mac and Fannie Mae to sell their entire investment portfolios of about $1.5 trillion worth of mortgage assets.” (Joseph Goldstein, “Pro-Deregula tion Schumer Scores Bush For Lack of Regulation,” The New York Sun, 9/22/08)

    Despite Reports Of Fraudulent Accounting, Schumer Opposed Creating A Strong Regulator For Fannie Mae And Freddie Mac In 2004. “Even after Freddie Mac was shown to have manipulated earnings, Congress remained deadlocked over legislation to create a stronger regulator. Opposing one such bill in 2004, Sen. Charles E. Schumer (D-N.Y.) argued that a hostile regulator could use the proposed powers to choke the companies.” (David S. Hilzenrath, “Fannie, Freddie Deflected Risk Warnings,” The Washington Post, 7/14/08)

    Schumer: We have a great housing market here. Fannie and Freddie are intrinsically wrapped up in that market, and you’ve got to be careful before you do too much dramatic change.” (Sen. Chuck Schumer, Subcommittee On Banking, U.S. Senate, Hearing, 4/6/05)

    In 2005, Schumer Said He Didn’t See “Eye To Eye” With Fed Chairman Alan Greenspan About The Need For GSE Reform. Chairman Greenspan: “I think the most important thing to take away is that it’s important to make the regulator a vehicle of safety and soundness for the GSEs, Fannie and Freddie especially. But unless there is some procedure that effectively contains the size of the GSE portfolios, we are leaving at risk a very significant segment of our financial markets.” … Sen. Schumer: “Mr. Chairman. As you know, I have utmost respect for you and think you’ve done an excellent job as Fed chairman, but on this issue we don’t see eye to eye. And in fact I’d say some of the things you’re saying — you’re a lot smarter on these issues than we are, but they almost defy common sense.” (Housing And Urban Affairs, Banking Subcommittee, U.S. Senate, Hearing, 4/6/05)

    Schumer Called On The Regulator For Fannie Mae And Freddie Mac To Lift Portfolio Caps To Buy More Mortgages. “Both Schumer and Christopher J. Dodd, D-Conn., the chairman of the Senate Banking, Housing and Urban Affairs Committee, have called on Fannie Mae and Freddie Mac’s regulator to lift the portfolio caps. They argue that allowing the two firms to buy more mortgages, at least temporarily, would inject much needed liquidity into the market and calm the financial markets.” (Michael R. Crittenden, “Schumer Will Seek To Lift Cap On Mortgage Portfolios Of Fannie Mae, Freddie Mac,” Congressional Quarterly Today, 8/16/07)

    After The Subprime Housing Crisis Began, Schumer Advocated Raising The Cap On What Fannie Mae And Freddie Mac Could Lend. “Even last September, as the subprime housing crisis began to metastasize and the market was expressing concerns about the pair, Sen. Charles Schumer (D-N.Y.), the powerful chair of the Senate banking subcommittee on housing, had the very bad (and ultimately rejected) idea of raising the cap on what Fannie and Freddie could lend by 10 percent. Since then the companies have reported losses of $11 billion, and there’s uncertainty about just how much more damage there will be from future defaults.” (Editorial, “We Can’t Say No, But We Can Regulate Them,” [New York] Newsday, 7/20/08)

  12. DL says:

    Calvin Jones @ 1:04

    “I wonder why Schumer isn’t a Rockefeller Republican instead”

    Can one get elected to the Senate from NY as a Republican?

    (And don’t forget that Schumer hates free trade).

  13. danm says:

    The new growth economy: incarceration.

    Let’s see, if we incarcerate every single person responsible for this mess what will the rate of incarceration become:

    1/6 Latinos
    1/3 Blacks
    1/1.5 Whites

  14. DL says:

    Barry Ritholtz @ 12:54

    “Everyone who blames Freddie and Fannie doesn’t understand their roles. They were minor cogs …”

    Maybe so, but we taxpayers would have been better off if they had used a lot less leverage.
    Fannie and Freddie have received a lot of bailout money already, and various guarantees at taxpayer expense. We won’t know the true cost of the Fannie/Freddie bailouts for several more years.

    That being stated, I would agree that much bigger problems lay elsewhere in the financial system.

  15. larster says:

    As long as we have a system whereby these guys have to raise gazillions for campaigns, the nSchumers of the world will pimp for the people with the money. Does anyone think that the southern GOP really cares about the UAW or are they trying to lock in contributions from transplant auto mfrs.

  16. DL says:

    larster @ 3:18

    If a politician is on the side of the taxpayers, I don’t care what his (or her) motivations are.

  17. VoiceFromTheWilderness says:

    Interesting — must have touched a nerve.

    Lets start with where we agree — since it’s important in its own right: I completely agree, it is called personal responsiblity, and I will be the first to support anyone who stands up and takes responsibility.

    I absolutely and completely fail to see how an obvious hit piece — I’ve now read it in it’s entirety — can possibly be defended under a rubric of taking responsibility. Nor frankly do I understand how faulting a culture of blame can be construed as an attack on personal responsibility. One could argue that the culture of responsibility died when St. Reagan pulled out harry truman’s ‘the Buck Stops Here’ sign, and put it on his desk, only to spend the rest of his administration claiming that he didn’t know about (and therefore was not responsible for) the illegal selling of weapons to our greatest enemy that was being run out of his basement. The Republican Party ever since has stood for talking big, and running away from… RESPONSIBILITY.

    Speaking of ranting, I think I’ll do a bit more:

    That piece on Chuck Schumer is the most blatant hit piece I’ve seen it quite some time. The only reference to the involvement of the administration was put in chuck schumers mouth and thus made to seem false. All by itself this is fascinating. The current administration has been more free from opposition both in Congress and in the press than any administration in history, and yet somehow, the NYTimes wants us to the think that free market deregulation which was the avowed agenda of the administration in it’s first electoral platform, and all subsequent platforms, was the fault of Chuck Schumer. It also goes out of it’s way to defend the SEC — whose blatant hands off approach has been obvious to all observers for a long time — as… wait for it… Chuck Schumers fault. Sure, right.

    I have no particular love of Chuck Schumer, nor indeed of the Democratic Party establishment what so ever. Perhaps because of that I can see Republican party attacks for what they are: an attempt to stave off or recapture support from those who most threaten them, because they most closely resemble them. The Republican Party hates Bill Clinton because he was the most right leaning Democratic President there had ever been. It is quite obvious that this piece is also aimed at Chuck Schumer precisely because he is being more right wing than the right wing. If the NY times were daily going around talking about how the Democratic Party in general was selling out it’s constituents and using electoral success with liberal voters to implement policies supportive of the right wing agenda, I might be more sympathetic. I don’t see them doing that. Instead I see them foisting off Republican hit pieces as news, and undermining the current congress under cover of exposing truth.

    I don’t buy it, it’s just a cheap excuse for crappy behavior. And I don’t believe their motives for publishing this thing are pure in the slightest, not in the slightest.

    So yes, lets have some Responsibility: The President, The SEC, The Treasury Department, The Financial Community, the Right Wing — who have been running this country for 10 years now. Economists spouting lies about globalization, ‘Free Market’ fools. And… The press for promoting their views and ideas at the expense of the ideas that might have done something to avert what is now a disaster. Chuck Schumer? sure why not I don’t care, but don’t try to fob off an attempt to paint him as the Evil One Incarnate as some kind of insight. It isn’t. It’s a hit piece.

  18. Mannwich says:

    Read that this morning as well at the gym. Time for to hold him accountable and vote him out too. If nobody is truly held accountable, how do we ever really fix it and move on?

  19. michael m. says:

    I hate to see this, but this reminds me of the Americans dealing with the Germans after World War II:
    they decided to continue running Germany with ex-nazis, because everyone who had been running the place was a nazi, and so trying to constitute a government with certifiable non-nazis, with a few exceptions, was impossible. In our case, it appears virtually everybody in power was either responsible or complicit.

    Of course, having some accountability for some number of the most prominent leaders of the disaster is generally a good idea on various grounds. Maybe we could do that. But I doubt we could get everyone.

    I wonder if the NYT is just trying to be “bold” and “daring” by going after a famous local figure, to show how pro-reform they are after all (after all those years of being at least complicit). They seem to be doing some of that on the Iraq war as well.

    It is all pretty awful.

  20. AGG says:

    A reporter in Iraq may not hace had a solution in mind, but it certainlay made the world feel better:
    Reporter calls Bush a dog and throws shoes at him. Barney is insulted.

  21. AGG says:

    Off topic but you might want to check on this up and coming electric car company in Israel. It’s called “Better Place”. There will be a lot of good, decent, help people and the planet type of profit available when this outfit is allowed into the USA. They are fixing to sell cars in Portugal and Australia now.

  22. VoiceFromTheWilderness says:

    If the New York Times wants to start taking responsibility for the lies it has told in support of policies that have killed millions of people, and are now destroying the livelihood of BILLIONS more, I would be quite supportive of that. If Punch Sulzberger wants to resign his position admitting that he has abused the public trust in the institution he inherited in favor publishing lies, and attack pieces disguised as information with the purpose of promoting the policies that have been directly responsible for the current crisis — I for one would call that Taking Responsibility. Sitting back and letting his paper publish hit pieces whose purpose is to deflect *blame* away from those *responsible* and to promote the obvious opening salvos of the next election is not taking responsibility. It’s manipulation plain and simple. Actually the current crisis is remarkable for the lack of Taking Responsibility on the part of those entrusted with stewarding the nations health. Far from taking responsiblity they have continued to blatantly use their office for personal gain all the while being euligized in the press for their glorious efforts on ‘our’ behalf. Another way we can tell that the culture of responsibility has been replaced by the culture of public scapegoating and blame is by the absolute lack of anyone in authority resigning or in any way accepting even the slightest clipping of their wings for what is at this point well on it’s way to being the end of the american hegemony in the world, and very likely the end of america as anything other than a third world debtor nation. Not one Cabinet official has resigned. Not one statement from the president or his puppeteer about their failures to effectively steward this country. Not one executive resigning. Not one. Just attempts to blame Democrats, and opportunities to present their self-pity in public.

  23. michael m. says:

    Voice’s passion is right My wife and I have remarked often in the last years how no one resigns to take responsibility – and they don’t resign from principles, either. It used to happen occasionally. I don’t think Voice’s remarks are in the rant category: it is the sort of passionate anger and disillusion that a lot of people who aren’t “in the game” feel; and it feels as though virtually everybody in power, is in the game. My colleagues and friends are always surprised when I mention to them that Wall street has given more to democrats than republicans for a while; then they understand that talk of serious “regulation” is just crowd propitiation on all sides. I don’t like riots, but I wish our country had some over these people just now; they need to be frightened, and they won’t be.

  24. DL says:

    One day on the McLaughlin Group, Mort Zuckerman said that the Fannie/Freddie bailout will cost $600-$700B.

    On the website below, he said it will cost $500B:


    The point is, even if Fannie/Freddie qualify only as a “minor cogs”, they’re likely to be expensive ones.

  25. VennData says:

    I wonder how they got the reserved, media-shy Schumer to even answer a single question from one of the local papers.

  26. BoboKnows says:

    “The biggest recipient of Madoff’s contributions was the Democratic Senatorial Campaign Committee, which received $100,000 in the past four years. The DSCC chairman during that time was Sen. Charles Schumer, D-N.Y., who also got $39,000 for his own campaign account from Madoffs since 1998, according to reports filed with the FEC.”


  27. nikhilverma says:

    Check this out: Fannie Mae Eases Credit To Aid Mortgage Lending in NYT dated September 30, 1999

    It’s an interesting insight on how politics and policy shift originated the crisis for Fannie and Freddie.
    Amazingly, the outcome of that decision was already known in 1999… and turned out exactly as predicted about a decade later! Check out this snippet from that article:

    In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980′s.
    ”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”


  28. Patrick Neid says:

    Everyone who blames Freddie and Fannie doesn’t understand their roles.

    They were minor cogs — it was the lenders who lowered lending standards, the wall street machine that bought the loans, and the ratings agencies who put triple AAA on them. Most of the bad loans were not securitized by Fannie / Freddie. By the time they got in to that line of business, it was way late in th cycle — 2005.

    Please try to hold the right people accountable!

    I think you are in some kind of denial about the role of GSE’s in this entire collapse and the ongoing trillion dollar bailout. To say they were minor players when they end up owning 2/3 of all the sub prime and liar loans currently on the books is a bit of a stretch. Even their own internal emails and regulators reveal the truth of their intent. They were manipulating the manipulators.

    While they may have been early and then late to bubble they clearly were as they say in Elliot terms the Fifth of the Fifth–the fastest largest most damaging last leg of madness. They new it and planned on it.
    The testimony last week by the principals was exactly as Fannie Mae detractors said it would be.

    Let it not be forgotten that there have been loud voices since the early 80′s that warned early and often that the GSE’s would ultimately bring down the house of cards they were building. From the pile of debris it looks like they knew what they were talking. The reason that certain politicians are being pelted by the much maligned free marketeers is for their constant championing of a economic construct doomed to failure but used as a vote getter in the interim by both parties.

    Hopefully at the end of this near depression we will all come to realize that the government’s role is to regulate but not to participate.

  29. this: Patrick Neid Says:

    from above, is most succinct and cogent summing of the true role of Phoney y Fraudy I’ve seen to date.

    as a +, it doubles, without change, as withering rebuttal to this: “They were minor cogs”-stipulation.

    an effective retort, to it, would be a new one on me..I’d love to see it.

  30. Brett Tibbitts says:

    The Schumer article and the Miami Herald articles are all a very important part of the process of truly understanding what has gone here: the United States had become corrupt and lazy from the top to the bottom. Yes, the majority of us stood and shook our heads with dismay at what was going on….and we are having to bail out the rest of the country now.

    But the level of blame here goes very deep: from current and past administrations, current and past congresses, bankers, bankers, bankers, state and local goverments which fed on increased property tax payments like drug addicts, to our entitled next door neighbors who had to get their free lunch.

    My biggest concern all the way along has been this country will try to blame this all on an unpopular president and his supposed laissez faire ways. That would be a huge mistake, because then the next crop of politicians would try to issue new regulations and walk away and let the next bubble occur.

    There are plenty of laws and regulations on the books to prevent what happened…….it’s just that not very many of our leaders lifted one finger to enforce them. The party and the punch bowl were just too good. This is nothing but greed and too many people forgetting the important maxim that if it’s too good to be true, IT IS!

  31. Dervin says:

    Everybody is familiar with the old saying “Only Nixon could have gone to China.” But I think we need to look at a different Nixonian accomplishment.

    Nixon created the EPA.

    Was Nixon a tree hugging foul smelling pot smoking hippie? Heck No.

    But it was the culture that pushed Nixon to do what he did.

    And that’s what everybody in government did. They just followed the culture of deregulation.

  32. bcasey says:

    I say we just go ahead full steam with Bush’s policies, if so in fifty years time all of New York will be in the ocean. In that fashion, we don’t have to do anything, and all of our problems will get solved for us.

  33. Neil C Denver says:

    Edward Pinto, formerly chief credit officer at Fannie Mae, recently told the House Oversight and Government Reform Committee that Alt-A loans, i.e. “liar loans”, now make up 34 percent of the total single-family mortgage portfolios at Fannie Mae and Freddie Mac.

    To redeem himself, Schumer should initiate legislation whereby the holders of these “liar loans” should be reported to the Internal Revenue Service. Mortgagees who have claimed higher incomes on their mortgage applications than their tax returns . . . should be taxed at the greater of the two income claims.

  34. Biloxi says:


  35. dunnage says:

    I want to know why wages for the last 50 years are down. Why this travesty goes unnoticed. Schumer is not a thinker, he is a power politician. The guys that drink kool-aid actually put to use the Philips Curve. Now days it takes two people working for a family to be comfortably in debt. Job market gets good and the Fed tosses a few million workers to the wolves for their own good.

    So what do you get: Half Century of Credit Expansion. The 90% on the bottom borrowing and the top making money out of money. Then the house in Riverside, Ca. depreciates and its all over. Now blame politicians when we had a Fed Head who spoke his own language — hey, the salaryman, bonus dudes thought Greenspeak was cute. And now who are the folks giving advice to our elected pols? Indeed, the people who did the final deed: the Leverage Loonies, and they are the world-wide over.

    What I like the best about the Supply Side mass suicide is that folks just can’t understand Paulsen when he gives a speech, if only the man could explain himself. Hell, he is clarity personified. He wrote a one page contract that said give me a Trillion Dollars — or we are doomed — and I will give it to my friends to do whatever they want with it. I consider this an investment because as you know my friends are at the top of the Ponzi and must survive or we all go. And that is what he did. He keeps telling reporters that that is what he did and they just don’t get it. Where is Britney Spears when you need her.

  36. eyedoc says:

    It shouldn’t be a Democrat versus Republican thing, but the reality is that the Congressional Democrats were warned by regulators that massive amounts of fraud were going on at Fannie and Freddie (and you can get the clips on You Tube so you don’t have to take my word for it) and they refused to do anything about it. The GOP was the majority party but didn’t have enough of a majority to pass legislation on their own.

    There were several pieces of legislation that were written to regulate Fannie Mae and Freddie Mac over the years, but because the Democrats were steadfastly against doing so (because of the large amounts of campaign contributions they were receiving from those companies, again you can look up how much Chris Dodd, Obama, Kerry etc were raking in) the legislation couldn’t get passed. Obviously the fraud came to light, both companies collapsed, and the economy has taken a big hit because of it.

    Another big piece of the puzzle was the Community Reinvestment Act, originally passed in 1977, and strengthened during the Clinton administration in a attempt to try to increase home ownership among poor minorities. A noble goal, but forcing banks to loan money to people who couldn’t pay it back is obviously stupid. Greed amongst bankers who could turn around and sell these bad loans to somebody else obviously was a big factor, but please don’t forget the our federal government played a huge role in creating this debacle, and asking the government to fix the problem that they in a large part created doesn’t make much sense to me.