As the global financial meltdown has rocked the stock market — and millions of 401-K’s along with it — the first thing to spring to the average American’s mind was something like “Okay, so how is George W. Bush responsible?”
It’s a question worth asking, but thus far there haven’t been many answers. Democrats blame Republicans for their dogmatic obedience to the financial sector, and their refusal to believe that it could do anything wrong. Republicans blame Democrats for… forcing them to give loans to minorities. (Yes, political operatives on the GOP side are writing straight-faced editorials claiming that the global financial collapse which is bankrupting people from New York to Istanbul is thanks to a few thousand poor folks in Chicago — most often believed to be Barack Obama’s friends and family, all of whom are also terrorists.)
But if we’re going to place blame along political lines, it’s going to be hard not to find fault with the part who has controlled congress for 12 of the last 14 years, and the presidency for 8 of them (read: Gasp, Republicans!!).
However, I’ve always thought the problem was much more subtle than that. It’s not so much that one party or the other has explicity designed our financial system to fail (though that is essentially the result of the GOP’s deregulation fixation). Rather, it’s a decades-long belief by both parties in Washington that rules and regulations really are best left alone. This is thanks to the popularity of Ronald Reagan. Not, mind you, the success of his policies, which is meh — but just the fact that politicians are trying to somehow capture the same stuff that made him popular, to use it for themselves.
Anyway, the point is, there’s a great writeup in Business Week explaining a key moment in the meltdown, when state officials went to the federal office of the Comptroller to warn him that “aggressive lending” — in the praiseful words of George W. Bush — was causing huge problems in their states, and the Comptroller (appointed by Bill Clinton) decided that he didn’t care, and that the days of government watchdogs and regulation had gone the way of the Dodo.
It’s true; they had. How about we bring them back? Freedom is great — but regulation isn’t a lack of freedom. It’s like putting more cops on the street, so we don’t let people’s freedoms result in the burning down of buildings.
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