Today's Republicans sense of entitlement is so limitless, that it includes being entitled to make up their own set of self serving facts.
Everyone is entitled to their own opinions, but they are not entitled to their own facts. -Daniel Patrick Moynihan
The most glaring example of self-serving Right Wing mythology that overly intrusive government regulations led to the financial crisis. This is so wildly at odds with what most experts and the business press have pointed to as the driving causes of the 2008 financial crisis.
More on a Former SEIU Official's Plot to Bring Down the Economy
RUSH: We have the subprime mortgage crisis, and what was that? The subprime mortgage crisis, if I may be blunt and honest, was a series of government directives to lending institutions demanding that they loan money to people who could not pay it back -- under the guise of affordable housing, fairness, making things equal in the country or what have you. But if you are going to use the power of the government to tell banks, "You've gotta give these people money essentially; they're not gonna be able to pay it back," what are you doing to them? Are you not launching an assault on them as is?
Now, the thing that the left never considers is the dynamic aspect of what they do, or the dynamic aspect of the economy. They look at everything statically. They see a tax increase on the rich. "Oh, that's gonna generate X numbers of dollars!" They don't factor what the rich will do to avoid paying it. So they slap these demands on lenders and banks. "You're gonna make loans to people that can't afford it." Well, what are the banks gonna do? They're gonna try t o figure out a way to get that money back somehow or shift and pass the loss down the line to somebody else, which is what happened in the form of new financial products called "derivatives" and "collateralized debt obligations" and all this other gobbledygook terminology that we heard, and where did it lead?
Well, it led in 2008 to a financial crisis that we were told could collapse the world financial system if we didn't bail out the banks with TARP in 24 hours.
This OpEd by Phil Angelides, the chairman of the Financial Crisis Inquiry Commission specifically refuted the myth Linbaugh is promoting was published three weeks ago in the Atlanta Journal Constitution:
Lending bill did not cause crisis
The debate about the role of the CRA should now be over as the evidence presented in the commission’s report is clear. Indeed, nine of the 10 commissioners agreed that the CRA was not a factor of significance in the crisis.
As we detail in the report, many subprime lenders were not even subject to the CRA and the vast majority of subprime lending was unrelated to the law. For example, according to a 2008 analysis by two Federal Reserve economists who looked at 14 million loans made in 2006, only 6 percent of higher-priced loans (a proxy for subprime mortgages) were made to low and moderate income borrowers or in low and moderate income neighborhoods by banks and thrifts (and their subsidiaries and affiliates) covered by the CRA.
Importantly, another study by economists at the Federal Reserve Bank of San Francisco showed that loans made by CRA-regulated lenders were half as likely to default as similar loans made in the same neighborhoods by mortgage lenders not subject to the law.
Angelides alludes to shameless propagandists like Limbaugh in his conclusion:
Even in the face of such overwhelming evidence, some still cling to their ideological theories as to the cause of the crisis. As our nation begins to recover, and as we debate the future of our financial markets in the United States, the facts should guide our way.
More from Angelides on the REAL causes of the 2008 Financial Crisis:
SN&R talks to Angelides about the financial crisis
What we catalog in this book is that all the warning signs were there: the explosion in egregious predatory lending, the exponential growth in out-of-control subprime lending, the growth of the shadow-banking market—you know, the very lightly regulated banking sector that grew to be bigger that our regulated banking sector in this country—the deregulation of derivatives in 2000 that opened up this huge financial market with no oversight, no transparency. And there were lots of warning signs along the way—as far back as the 1990s, community groups were complaining about predatory lending. In 2004, the FBI warned about an epidemic of mortgage fraud, saying that if it went unchecked it would result in a crisis as big as the [savings and loan crisis of the ’80s and ’90s]. They repeated those warnings in 2005. There were lots of red flags, lots of stop signs, but people just kept fumbling along. And we were let down by the regulators of this country who were asleep at the switch. We were also let down by the leadership of major financial corporations who took enormous risk that ultimately turned into a bill for the American taxpayer.
I listened to an Phil Angelides interview yesterday on the local NPR station instead of listening to Rush Limbaugh as I have been lately, and I'm glad I did. Phil Angelides hit Limbaugh's fallacious argument out of the park! Here's the link to the Angelides interview: What Caused The Financial Crisis?
This is all paying out now with Republican efforts to de-fund the cornerstone of Financial Reform the Consumer Financial Protection Bureau and attacking Elizabeth Warren, nominated to head the new Bureau. Warren is as knowledgeable as he is courageously honest. In other words she's a crooked Bankster's worst nightmare.
Barny Frank isn't having any of it. Frank is calling the Republicans out on their smear campaign against Elizabeth Warren.
As for Elizabeth Warren? Barney Frank says: “Let’s fight!”
The former Democratic chairman of the House Financial Services Committee, who co-authored the Dodd-Frank financial regulation bill, tells MSNBC’s “Morning Joe” that Warren might survive a confirmation battle.
His reasoning? “This is not just the left and the right. The Republican Party is united against healthcare and united against the environment. They’re not united against financial reform.”
Even more to the point: “The Tea Party people didn’t send people to Washington to defend derivatives. I think the fight over Elizabeth Warren would be worth having and I’m not sure how all the Republican senators would vote.”
The Republicans' smear campaign against Elizabeth Warren behalf of the Banksters who wrecked our economy must not be allowed to succeed.