Is Bill Clinton partially responsible for the economic meltdown in the US?
Former President Clinton is on the campaign trail claiming he has nothing to do with the current economic crisis. However, the facts are these:
When President Clinton was president his terms was characterized by economic prosperity and financial deregulation, which in many ways set the stage for the excesses of recent years. Among his biggest strokes of free-wheeling capitalism was the Gramm-Leach-Bliley Act, which repealed the Glass-Steagall Act, a cornerstone of Depression-era regulation. The repeal enabled commercial lenders such as Citigroup, which was in 1999 then the largest U.S. bank by assets, to underwrite and trade instruments such as mortgage-backed securities and collateralized debt obligations and establish so-called structured investment vehicles, or SIVs, that bought those securities. It is therefore seen that the repeal of this act is directly responsible for the Global financial crisis.
That was not enough for former President Cliinton. He also signed the Commodity Futures Modernization Act, which exempted credit-default swaps from regulation. The Commodity Futures Modernization Act of 2000 has received criticism for the so-called “Enron loophole,” which exempts most over-the-counter energy trades and trading on electronic energy commodity markets. This was one of the big reasons for the collapse of Enron.
Not convinnced yet? In 1995 Clinton loosened housing rules by rewriting the Community Reinvestment Act, which put added pressure on banks to lend in low-income neighborhoods. All these rules changes played a role in creating a permissive lending environment. This in turn led to more loans being given to people who really could not afford them, leading to defaults today.
After all of this, do you believe our former president when he says to the media, “I am not a fault for any of this financial mess? Do you believe if my economic team was in place that any of this would have happened?”
My answer is yes I do – after reading about all the things he did in great detail, I put part of the blame squarely on his broad shoulders. To deny he had nothing to do with it seems like he is trying to rewrite history. What do you think?
Hmm. The surplus has nothing to do with the current situation. How does that figure into this quesstion?
True, anything can be overridden – but how does that absolve Clinton for pushing these ideas in the first place?
Although Clinton is not formerly campaigning, he is making repeated statements (three in the last two days) stating he has NOTHING to do with the economic downturn. If this is not campaigning for his reputation history, what is it then? Just random statements?