Saturday, December 22, 2007

A Backward Presidency

George W. Bush started out to be Ronald Reagan, morphed into Richard Nixon and, toward the end, is starting to resemble Herbert Hoover.

The shanties, shacks and cardboard shelters in communities spawned by the Great Depression and known as Hoovervilles are showing up in 21st century America as a result of the sub-prime mortgage crisis that has doubled foreclosures of homes in the past year.

"Between railroad tracks and beneath the roar of departing planes," Reuters reports, "sits 'tent city,' a terminus for homeless people. It is not, as might be expected, in a blighted city center, but in the once-booming suburbia of Southern California.

"The noisy, dusty camp sprang up in July with 20 residents and now numbers 200 people, including several children, growing as this region east of Los Angeles has been hit by the U.S. housing crisis."

Not only are homeowners being dispossessed, but tenants are, too. A California realty firm estimates 20 percent of foreclosures are on homes bought as investment properties. Even after paying their rent, tenants are getting little notice before being evicted.

As former Federal Reserve Chairman Alan Greenspan takes most of the heat for not foreseeing the crisis, Paul Krugman points out the Bush Administration's share of the blame:

"Consider the press conference held on June 3, 2003--just about the time subprime lending was starting to go wild--to announce a new initiative aimed at reducing the regulatory burden on banks. Representatives of four of the five government agencies responsible for financial supervision used tree shears to attack a stack of paper representing bank regulations. The fifth representative, James Gilleran of the Office of Thrift Supervision, wielded a chainsaw...

"Two months after that event the Office of the Comptroller of the Currency, one of the tree-shears-wielding agencies, moved to exempt national banks from state regulations that protect consumers against predatory lending."

After weakening the patchwork of federal agencies to let banks run wild with loose loans, Bush, like Hoover, is responding with government action that is too little and too late. A Treasury Department plan to freeze mortgage rates has been deemed a failure even before it is in place.

It's a little like watching a lowlight reel of the 20th century being played backward at warp speed.


Unknown said...

Another cutting-edge post, sir. As an environmental consultant I spend around half my time doing field work on properties someone is looking to "develop." I'm seeing more tents and those camps look relatively prosperous and well-ordered. I've seen others much worse: blue tarps and piles of junk. One camp is set up near a local VA hospital.

Still, there doesn't seem to be a critical mass of citizens willing to demand something be done.

Anonymous said...

Things I learned in a hobo jungle
Were things I never learned in a classroom
While OUR nation faces certain financial ruin.
Call Nancy Pelosi @1-202-225-0100 and DEMAND IMPEACHMENT.
DO IT for yourself and YOUR country.
Mike Meyer

Anonymous said...

There is a name you have omitted in your pantheon of former Republican presidents who seem to have inspired Mr. Bush: Warren G. Harding. Harding's unique combination of toleration of corruption in his underlings, and insistence that businesses be allowed to do whatever they pleased, is the truest forerunner of the Bush administration. Of course, Harding set the country on the road to the Great Depression, but that could never happen again....