Letters to the editor

Economic recession blame should be reconsidered

Over the last month, it seems like every news outlet in the country has found a way to capitalize on the economic fears surrounding the U.S. recession.

Two things strike me as being odd. First of all, according to most sources, this recession has been in effect for over a year now. Why did it take us a full year to figure it out? In fact, up until last month, many news outlets were afraid to even mention the dreaded "R" word.

Secondly, in a news culture that seems to jump at fault finding, why has the media been so uncharacteristically mute about the origin of this global financial crisis? Does anybody know what caused the Dow Jones Industrial Average to lose over 40 percent of its value over the course of thirteen months?

America is experiencing its highest rates of unemployment since World War II, and few of the recession stories passing through the media seem to care about what put us here in the first place.

Perhaps we're content to bundle our faltering economy with the other apparent failures of the Bush administration. In the decades that preceded our present recession, mortgage-backed securities were rightly viewed as some of the most rock-solid investments in existence. Insurance companies and banks relied on them extensively. Enter Bill Clinton.

Around 1999, Clinton made it his goal to extend home ownership to lower income Americans, which was a noble goal indeed. In order to facilitate his plan, Clinton recklessly changed the policies of the government agencies that regulate our country's mortgage economy.

Under Clinton's direction, Fannie Mae began backing all kinds of risky deals, which led banks to begin offering mortgages to anyone smart enough to sign their name and lie about their income. The resulting influx of newly-eligible home buyers caused demand and real estate prices to skyrocket, bolstering the economy for a few years, but at what cost?

Now, the economy is in shambles and another well-meaning Democrat is about to take office. President-elect Obama seems to be full of ideas for how we can fix our economy with extensive federal spending and government programs, but will he avoid making the same mistakes Clinton did?

Mark Loiseau

Electrical Engineering