In February! (H/T Thom Hartmann)
Eliot Spitzer lays the whole problem out quite well in a February 14, 2008 column:
Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government. Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many subprime lenders that were engaged in predatory lending practices. Several state legislatures, including New York's, enacted laws aimed at curbing such practices.
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What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no.
Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.
Granted, the mortgages themselves were not the entire problem--it was also the way they were sold, resold and bundled that got us into the current mess--but the lending is what the wingnuts are using to blame the whole thing on Clinton and democrats. (Fortunately, outside of CNBC, Fox and wingnut circles--Limbaugh, Malkin et al--it's not getting much traction.)
Spitzer lays out the anti-American Bush administration opposition to the bill, in which they invoked a 140-year-old consumer protection bill as a bank protection act:
For 140 years, the OCC (Office of the Comptroller of the Currency) examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.
The OCC was set up to, among other things:
Issue rules and regulations governing bank investments, lending, and other practices.
Pretty prescient of Spitzer, eh? Not really. When the feds go up against all 50 states' warnings; it seems hard to imagine them later saying this caught them by surprise.
Let's just hope that the former Governor is equally prescient with his closing:
When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners, the Bush administration will not be judged favorably. The tale is still unfolding, but when the dust settles, it will be judged as a willing accomplice to the lenders who went to any lengths in their quest for profits. So willing, in fact, that it used the power of the federal government in an unprecedented assault on state legislatures, as well as on state attorneys general and anyone else on the side of consumers.
There has been speculation that Spitzer was investigated because of his strong anti-Wall Street and anti-corruption record, but that's for a different day.