"Blame it on Bush" is the sarcastic phrase which John McCain could be heard sneering to his colleagues shortly after his defeat in 2008, as if knowingly exasperated that the democrats could do no better than to excuse their poor economic numbers by blaming the last president. This kind of spin is presumably intended to silence the democrats' defense that they inherited a disaster for which no quick fix is possible. If the American public does have this short a memory, then perhaps the republican reputation is safe.
But I have to wonder, is it really enough to the republicans themselves just to convince the electorate? Sure, maybe for a cynical few but this is a party of such thoughtful people as Barry Goldwater, William F. Buckley and many others, folks who spend time (presumably over cigars) considering the philosophy behind their policies. Republican ideology differs from democratic ideology for a reason. They want a different outcome than the democrats, one that they honestly believe is better for the country. It matters to any member of any party whether the implementation of their policies actually works.
And yet the republicans, after having been delivered unchecked power in all three branches of American government in 2004, witnessed soon after a global economic collapse tied in no small part to policies they implemented a few short years before. No amount of distraction, voter suppression or redistricting can quell the gnawing doubt that has to come with that.
The first line of defense for many republicans when faced with failures of the Bush administration is to assert that the record of George W. Bush does not represent the true republican ideology. He spent too much on discretionary programs to be considered a true republican. The Medicare Prescription Bill, No Child Left Behind, the bail out of our citizens after Hurricane Katrina not to mention the bail out of the banks were all enormous expenditures that many republicans distanced themselves from. To many, Republican ideology itself is not seen as having failed because in its true form it was not actually given a chance.
When Bush presented the idea of an Ownership Society related to home ownership in 2002 he embellished the plan with large government programs to help first time home buyers with their down payments as well as other programs. This use of taxpayer money was an anathema to small government conservatives, the concept of the Ownership Society however, was and is popular among conservatives specifically because it is designed to reduce dependence on government "handouts."
From David Boaz of The Cato Institute:
“ An ownership society values responsibility, liberty, and property. Individuals are empowered by freeing them from dependence on government handouts and making them owners instead, in control of their own lives and destinies. In the ownership society, patients control their own health care, parents control their own children's education, and workers control their retirement savings. ”
http://www.cato.org/...
A far better solution was to let the free market work this out with its own innovative lending strategies and the freedom to control their market without restrictive regulation. Part of Bush's initiative did include encouraging mortgage companies to come up with their own ideas for how to lend to first time buyers, particularly those who might not be able to afford a down payment, in a way that worked in the interest of their shareholders.
Regulation was certainly a non-issue by this time since two bills had already completely deregulated the industry. The Financial Services Modernization Act of 1999 allowed commercial and insurance banks to merge along with securities firms and the Commodity Futures Modernization Act of 2000 deregulated the derivatives market. With total freedom in the market the banking industries proved to be so innovative that the financial bundles they invented, traded and eventually shorted were so abstract that it was hard to tell what was even in them.
Former Fed Chairman Alan Greenspan kept interest rates low to encourage this trend and argued against reinstating regulations of the financial industry because, as he said in a hearing before congress after the number of loan defaults finally started crashing the bond market, he had presumed:
"that the self interest of institutions, specifically banks and others were such that they were best capable of protecting their own shareholders."
This was Alan Greenspan's belief. It was his and others' rationale behind the deregulation of the market. In light of its failure, Mr. Greenspan admitted to democratic congressman Henry Waxman, then chair of the House Committee on Oversight and Government Reform that this belief had been a mistake.
Under further questioning a few minutes later came the following exchange:
Waxman: "Do you feel that your ideology pushed you to make decisions that you wish you had not made?"
Greenspan: "Well remember what an ideology is, it's a conceptual framework with the way people deal with reality. Everyone has one, you have to. To exist you need an ideology. The questions is whether it is accurate or not and what I'm saying to you is yes, I found a flaw. I don't know how significant or permanent this is but I've been very distressed by that fact...but if I may, may I just finish an answer to a previous--?"
Waxman: "You found a flaw--- in the reality?"
Greanspan: "A flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak"
Waxman: "In other words, you found that your view of the world, your ideology, was not right--it was not working."
Greenspan: "Precisely."
http://www.youtube.com/...
The republican party has yet to take responsibility for the flaws in their ideology which led to our current economic crisis, for now they have themselves "blamed it all on Bush" specifically his discretionary spending. They have not distanced themselves from the ideology that Alan Greenspan is describing here, the belief that the free market can be always be relied upon because it is in the self interest of private institutions to not do anything to harm their own shareholders. Republicans still support, strongly, this method of reforming health care and retirement planning.
Would such a policy actually empower senior citizens to choose the best retirement option available to them? Is it conceivable, however remotely, that an incentive could ever exist to bet on the failure of an individual health care account of a person with cancer? Might there be created bundles of retirement investments divided into layers determined by each plan's likelihood of ever having to pay out?
Greanspan for his part, has restored his faith in the free market and now says that except for "notably rare exceptions" it works well.
Today’s competitive markets, whether we seek to recognise it or not, are driven by an international version of Adam Smith’s “invisible hand” that is unredeemably opaque. With notably rare exceptions (2008, for example), the global “invisible hand” has created relatively stable exchange rates, interest rates, prices, and wage rates.
http://crookedtimber.org/...
The key word here is not so much the word "rare' as it is "notably". Yes, this housing market collapse has certainly been notable. And yet to consider a correlating disaster like this happening to the elderly and the sick, it's even more disturbing. Given the strong belief that republicans still have in the free market to regulate itself, I guess we would just have to hope that such a notably rare exception would never occur again.
And as the saying goes, if you believe that, I have a condo down in Florida you should really see...