WH accuses NYT of "gross negligence" for article blaming Bush for mortgage crisis

[ProSense]

WH on Times: 'Gross negligence'

The White House on Sunday issued a blistering 500-word response to a scathing 5,000-word article on the front page of Sunday's New York Times that says President Bush and his style and philosophy of governing played a direct role in the mortgage meltdown that's crippling the nation's economy.

The response accused the nation's largest Sunday paper of "gross negligence."

"The Times' 'reporting' in this story amounted to finding selected quotes to support a story the reporters fully intended to write from the onset, while disregarding anything that didn't fit their point of view," White House Press Secretary Dana Perino said in an e-mailed statement.

In an unusual double-header, The White House later issued a document headlined, "Setting the Record Straight: The Three Most Egregious Claims In The New York Times Article On The Housing Crisis."

The article was part of the newspaper's "The Reckoning Series" about the nation's market implosion, and was headlined, "‘Ownership society’: White House Philosophy Stoked Mortgage Bonfire."

"Eight years after arriving in Washington vowing to spread the dream of homeownership, Mr. Bush is leaving office, as he himself said recently, 'faced with the prospect of a global meltdown' with roots in the housing sector he so ardently championed," says the article by Jo Becker, Sheryl Gay Stolberg and Stephen Labaton. "There are plenty of culprits, like lenders who peddled easy credit, consumers who took on mortgages they could not afford and Wall Street chieftains who loaded up on mortgage-backed securities without regard to the risk. But the story of how we got here is partly one of Mr. Bush’s own making, according to a review of his tenure that included interviews with dozens of current and former administration officials. From his earliest days in office, Mr. Bush paired his belief that Americans do best when they own their own home with his conviction that markets do best when let alone. ...

"Mr. Bush did foresee the danger posed by Fannie Mae and Freddie Mac, the government-sponsored mortgage finance giants. ... As early as 2006, top advisers to Mr. Bush dismissed warnings from people inside and outside the White House that housing prices were inflated and that a foreclosure crisis was looming. And when the economy deteriorated, Mr. Bush and his team misdiagnosed the reasons and scope of the downturn; as recently as February, for example, Mr. Bush was still calling it a 'rough patch.' The result was a series of piecemeal policy prescriptions that lagged behind the escalating crisis."

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From the NYT article:

Mr. Bush did foresee the danger posed by Fannie Mae and Freddie Mac, the government-sponsored mortgage finance giants. The president spent years pushing a recalcitrant Congress to toughen regulation of the companies, but was unwilling to compromise when his former Treasury secretary wanted to cut a deal. And the regulator Mr. Bush chose to oversee them — an old prep school buddy — pronounced the companies sound even as they headed toward insolvency.

As early as 2006, top advisers to Mr. Bush dismissed warnings from people inside and outside the White House that housing prices were inflated and that a foreclosure crisis was looming. And when the economy deteriorated, Mr. Bush and his team misdiagnosed the reasons and scope of the downturn; as recently as February, for example, Mr. Bush was still calling it a “rough patch.”

Bush ‘Ignored Remarkably Prescient Warnings That Foretold The Financial Meltdown’:

As the housing bubble burst and the ensuing economic crisis gained steam, conservatives set about trying to find someone to blame for the meltdown of the mortgage market. First, it was Fannie Mae and Freddie Mac, and then loans made to low-income people through the Community Reinvestment Act.

As The Wonk Room has noted, the problem was actually the Bush administration’s failure to regulate the mortgage markets, while financial institutions developed ever-more sophisticated instruments for securitizing mortgage debt and selling it around the world.

[SuperTrouper]

1. Oh, poor Bush. First the shoes and now this...

:nopity:

[MichiganVote]

2. NYTimes didn't go far enough. Forgot to mention Bush is an asshole.

[DemzRock]

3. The W administration = "ignored warnings"!

We've heard that phrase over and over the last 8 years. What's up with that?

[NJmaverick]

4. The NYT's (along with many others) are guilty of gross negligence

because they didn't expose bush's lies about the Iraq war in a timely manner. Not because they reported some of the ugly truths about the boy wonder.

[moondust]

5. Ownership Society.

Seems to me that the housing industry was about the only thing keeping the Bush economy from tanking for several of the past eight years. To keep it that way one might imagine something like an "ownership society" to encourage and maintain a steady stream of buyers. But that meant more and more buyers who were less and less creditworthy. So the credit standards got lowered to accommodate them until some places were handing out mortgages to people without any verifiable income.

It wouldn't surprise me to learn that the pressure to keep lowering the credit standards and handing out ever more risky mortgages came right from the top.

[rasputin1952]

6. The RW, the one's who scream about accountability...

refuse to accept said accountability.

FACT: bush has been in office for nearly 8 years, other than his administration, who else is to blame?

Worst president/administration EVER.