Editore"s Note
Tilting at Windmills

Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

February 21, 2009

ARE WE STILL STUCK IN OCTOBER?.... Watching conservatives talk about the economic crisis, the arguments start to have a certain "Groundhog Day" quality.

On MSNBC, Pat Buchanan perpetuated the myth that government efforts to expand affordable housing to underserved communities caused the financial crisis, a charge that has frequently taken the form of attacks on the Community Reinvestment Act. In fact, as Fed chairman Ben Bernanke has stated: "Our own experience with CRA over more than 30 years and recent analysis of available data, including data on subprime loan performance, runs counter to the charge that CRA was at the root of, or otherwise contributed in any substantive way to, the current mortgage difficulties."

Karl Rove blasted President Obama on Fannie and Freddie from 2005. Phil Gramm insisted he's not to blame, but CRA and Fannie/Freddie are. Last night, Bill O'Reilly blasted Rep. Barney Frank (D-Mass.) for "pumping it that poor people ought to be given mortgages 'cause everybody has a right to a house."

All of these arguments, from just the past few days, are obviously wrong. But more importantly, these are the same arguments the same characters were making in October, when they were also debunked and proven baseless.

When I saw Media Matters' item noting Pat Buchanan blaming "minority communities" for the financial crisis, I had to triple-check the date to make sure it wasn't a piece from last year.

Didn't we already have this debate? Isn't it already clear that the conservative talking points were wrong in October, and haven't improved with age?

I suspect most of these conservative media personalities know their arguments are wrong, but haven't quite come up with anything new yet. So, they recycle the old talking points, discredited though they may be.

It's kind of sad, really.

Steve Benen 9:20 AM Permalink | Trackbacks | Comments (38)

Bookmark and Share
 
Comments

It's no different from the "Obama is a Muslim" article of faith that some people will never, ever ever give up no matter what proof you show them to the contrary. When you have faith, you don't need proof, certainly not proof that undermines your beliefs. And when that belief allows you to blame everything on a despised race, religion or social class, these people will never budge. Remember, we're talking about Pat Buchanan here, one of the most unapologetic racists and anti-Semites in the United States.

Posted by: T-Rex on February 21, 2009 at 9:20 AM | PERMALINK

I suspect most of these conservative media personalities know their arguments are wrong

I suspect they live in the same bubble world as the bulk of their base where never is heard a contradicting word to their favorite talking points.

Posted by: martin on February 21, 2009 at 9:25 AM | PERMALINK

Of course they know they're wrong, because the whole purpose isn't to be right, it's to fix blame on the right political targets, and deflect blame from their own kind. This is right-wing methodology at its most basic, and they will keep doing this, whether gullible libs counter their "arguments" as if they were made in good faith or not. It's called "lying," and they should be called "liars."

Posted by: R. Porrofatto on February 21, 2009 at 9:36 AM | PERMALINK

'Wrong' in the sense of 'not consistent with reality'-- sure. But 'wrong' in the sense of 'I only hear what I want to hear'? Who can deny that?

Posted by: MattF on February 21, 2009 at 9:37 AM | PERMALINK

These are things a lot of people want to believe. Reality has nothing to do with it. They will have to smacked in the face with the truth repeatedly for a year or 2 to even have a chance of deprogramming them. The right wing media has created a substantial minority cult with many more predisposed to their perspective.

Posted by: Michael7843853 on February 21, 2009 at 9:38 AM | PERMALINK

As things get worse across the world, the more shrill the Freemarket ideologues, Wingnuts and their MSM enablers will be because its a combination of panic filled flop sweat and the NEED to deflect the blame.

The magnitude of this economic disaster is starting to be felt in places and industries that assumed they would escape. The supposed economic engine of Asia, China, is feeling major heat right now. So is Japan and the rest of Asia. Europe is already in a deep recession.

Many of the common folks are going to or have already started to blame America for this. The smarter and/or richer ones are going to or already have point the finger at the Republicans and/or Free Market types.

Among the smarter group of folks are those with some influence and money, like the royal Saudis, various multinational corps, the old money Rothchilds or the noveau riche Chinese Communist Party. They don't tolerate stunning epic public failure (especially if they think they're not to blame and they are getting soaked.)

Who has been propping up the RW noise machine? Much of the same. As the eelights cut off their cash or cease to have cash, we will see many a RW wingnut retirement plans go arwy and that the Tink (sic) Tanks that the wingnuts/free marketers expected well paid but ultimately pointless sincures will disapppear.

Means that for many, they are going to actually have to find a real job. And good luck with that considering that there are many folks already flooding the market.

Posted by: Former Dan on February 21, 2009 at 9:39 AM | PERMALINK

The political class both left,middle and right have all used the gov't to increase home ownership leading to a large excess supply of homes. Currently the FHA programs provide the new subprime kool aid with tiny down payments and low interest rates for housing that is declining in value!
The government needs to revise its tax policies regarding real estate, namely ending tax benefits for interest deduction above 25K thereby supporting middle class but ending the joy ride for the financial elite who can get up to one million in interest write offs.
The gov't is to blame for the current crisis over a long period and both major parties desire the blame!

Posted by: ron on February 21, 2009 at 9:44 AM | PERMALINK

when you lack shame and embarrasment...

the old arguments are all you will ever have...

Posted by: mr. irony on February 21, 2009 at 9:48 AM | PERMALINK


Top-25 people responsible for current economic crisis:

#1 GOP Sen. Phil Gramm

#2 SEC Chairman under Bush - GOP Chris Cox

#15 GOP G.W.Bush

#16 The American Consumer

#17 Alan Greenspan

#18 Bush Tres. Sec. Henry Paulson

#23 Bill Clinton

- TIME readers poll 2/20/09

Posted by: mr. irony on February 21, 2009 at 9:49 AM | PERMALINK

Whether an argument is factually correct is nearly irrelevant to it's intended political effect. These lies worked (at least for some substantial portion of the population), then, and they still work now. Seeing liberals refute them, only reinforces the believers (if those evil libs think this is wrong, it must be right).

Even a few off message conservatives, such as B Bernanke, won't make any real dent -although his future with the movement types is probably now caput. These sorts are our best hope for countering the propaganda, but even if a bunch of them come out of the woodwork, don't expect much progress.

Posted by: bigTom on February 21, 2009 at 9:53 AM | PERMALINK

These guys, and right wingers generally, long ago made their commitment to the "big lie" technique. I think that it may be a boilerplate component of the standard contract selling one's soul to the devil.

Posted by: capitalistimperialistpig on February 21, 2009 at 9:53 AM | PERMALINK

@ron,

Hee hee.

Still blaming home ownership? That's like blaming the Poles for starting WW2. The collapse of the US Real Estate Market lit the fuse, but Wall St and the rest piled on the explosives and built up the bomb.

For instance, the Hong Kong real estate market collapsed in 1997 but it didn't take out the rest of the world in the process because their mortgages were bundled up as Grade A investments and sold to pension funds and bond funds. Why didn't the collapse of the internet bubble create the same mess? Because it was isolated to the equity market and not the bond/pension funds.

Let me explain to you ron. The Pension fund and Bond Funds account for some 70% of what is known as the financial markets while equities like stocks only account for 30%. There were laws in place that prevented Bond and Pension funds from buying crap investments in large part because of the scale of economic disaster if they did. Thanks to the Phil Gramms of the world, they bought a lot of this crap and what we are witnessing today is the collapse of the said bond and pension funds not just the stock market hence the collapse of 100% of what we call finance.

Who changed those rules? Who turned a blind eye? Who were the folks who thought that mixing subprime and AAA mortgages were a good idea?

That would be your boys and Wall St and the ignorant enablers like you who did. So if you're going to blame someone then look in the mirror, fool.


Posted by: Former Dan on February 21, 2009 at 10:01 AM | PERMALINK

All you need to do is copy and paste that Bernanke quote to any wingnut website, letter to the editor comment section in your local paper or anywhere else you see some jabbering fool making these arguments to shut 'em up. Of course we could leave the uninformed indies to the tender mercies of these a-holes. Afterall Obama won, now we can sit back and do nothing right? Um no.

Posted by: markg8 on February 21, 2009 at 10:24 AM | PERMALINK

"Under HIS leadership, the overall U.S. homeownership rate in the second quarter of 2004 was at an all time high of 69.2 percent."

Posted by: White House web site 8/9/04 on February 21, 2009 at 10:24 AM | PERMALINK

Of course they know they're wrong, because the whole purpose isn't to be right, it's to fix blame on the right political targets, and deflect blame from their own kind.

Bingo. Let's review this again: The point is not to be right, but to convince voters that the opposing side is wrong. Again, The. Point. Is. Not. To. Be. Right. They are reinforcing their ideology and undermining its opposition, period-- effective policies and governance are not even part of the calculation.

Democrats rely on actual Republican failures to achieve political success; Republicans rely on creating the perception that democrats are failures for theirs. You tell me which is easier, and which has a more impressive success rate.

Posted by: latts on February 21, 2009 at 10:46 AM | PERMALINK

It's more than sad, Steve. It's the constant reiteration of lies that keeps a solid chunk of the population utterly misinformed about basic political, economic, and scientific facts. It's different from what the Nazis did only in the enormity of the lies. It doesn't matter how long the whacko right is out of power so long as they maintain a base informed by such lies, and sooner or later they'll be back again. Look at the resurgence of the genuinely crazy idea that the New Deal perpetuated or even caused the Great Depression. The accurate view should long have been a matter of established fact at this point, but here is a lie that's been kept alive longer than most people alive today by constant reiteration among a fanatical minority. It's a wonder, given the astonishing longevity of utterly false beliefs, that more people in this country don't believe that slavery was good for black people.

Posted by: DCBob on February 21, 2009 at 10:51 AM | PERMALINK

R. Porrofatto has it right. If the blame is laid on CRA, then it is a political issue. If CRA has nothing to do with the mortgage mess, then there's no political slant.
The answer to the equation must always be Democrats. Therefore, if Democrats: then CRA. What could be easier.

God forbid that a host of a show on MSNBC (or any other talking head show) would cite contrary evidence. Then Buchanan inter alii really would be shown as a liar.
Can't have that. It takes a village to deliver the news.

Posted by: mickscotty on February 21, 2009 at 11:01 AM | PERMALINK

Former dan -great post. It's important nip total bullshit in the bud.

Posted by: Gandalf on February 21, 2009 at 11:01 AM | PERMALINK

Republican "conservative" talking points resemble those used by English overlords in their efforts to exact more from the famished Irish c. 1844. Forget last October, these stimulus detractors are beginning to sound like social Darwinists! -Kevo

Posted by: kevo on February 21, 2009 at 11:02 AM | PERMALINK

it's all in the repetition ... doesn't matter if it's been debunked. in fact, sometimes that helps because if it survived the debunking, it must be true!

the lie told many times will be remembered better than the truth told once.

Posted by: karen marie on February 21, 2009 at 11:07 AM | PERMALINK

The GOP strategy is to throw enough shit against the fence and see what sticks.

Unfortunately, I think they've found something here--the 2009 equivalent of Ronald Reagan's completely untrue welfare Cadillac story.

Santelli's argument on the floor of the Mercantile Exchange (which he ought to be forced to repeat to the "losers" in the stockyards and on the waterfront) is working nationwide because, like the food stamp lady in front of you in a crowded supermarket line, aid to housing "deadbeats" is tangible in a way that far-off credit default swaps are not.

Americans always hate their peers more than the monied classes who abuse them from far above.

Posted by: Steve High on February 21, 2009 at 11:19 AM | PERMALINK

For anyone who wants to see numbers and analysis, see Risky Borrowers or Risky Mortgages: Disaggregating Effects Using Propensity Score Models at
http://www.ccc.unc.edu/documents/RiskyMortg_Final_Dec11.pdf

Quotes:

The debate over what caused the mortgage mess and how best to fix it has important
policy implications. What is missing in the debate is an empirical examination of the
relative performance of similar borrowers holding either a typical CRA loan or a
subprime product....

We address this issue by comparing the performance of subprime loans and CRA
loans in a special lending program called Community Advantage Program (CAP). To
solve the problem of selection bias since performance differences may be due to
differences in the borrowers who receive each product type, we rely on propensity
score matching methods to construct a sample of comparable borrowers. We find that
for borrowers with similar risk characteristics, the estimated default risk is about 70
percent lower with a CRA loan than with a subprime mortgage. Broker-origination
channel, adjustable rates, and prepayment penalties all contribute substantially to the elevated risk of default among subprime loans. When broker origination is combined with both adjustable rates and prepayment penalties, the borrower’s default risk is four to five times higher than that of a comparable borrower with a prime-term CRA mortgage. Though CAP has some program specific characteristics, the results of this study clearly suggest that mortgage default risk cannot be attributed solely to borrower credit risk; the high default risk is significantly associated with the characteristics of loan products. Thus, the results are not consistent with the concerns of those blaming the borrowers likely to benefit from CRA and similar regulations.

Using propensity matching methods, we constructed a sample of comparable borrowers with similar risk characteristics but holding the two different loan products. We found that, for comparable borrowers, the estimated default risk is much lower with a CRA loan than with a subprime mortgage. More narrowly, we found that the broker-origination channel, an adjustable rate. and a prepayment penalty, all contribute substantially to the elevated risk of default among subprime loans. [emphasis added]

Bar charts and such can be seen at Risky Borrowers or Risky Mortgages? at

http://www.ccc.unc.edu/documents/HUD_Oct2008_final.pdf

.

Posted by: SteveGinIL on February 21, 2009 at 11:27 AM | PERMALINK

I know we all remember Bush speeches patting himself on the back stating that under his leadership, home ownership was at an all time high.Now that the repubs have imploded of course it is all Dems fault that poor people have homes.It is worrying how the repubs and the hate radio freaks are trying to incite hate and violence against President Obama. Perhaps they all have money hidden in those Swiss bank accounts that Gramm is partial to.Perspectives web site has a really good piece about him.

Posted by: JS on February 21, 2009 at 11:54 AM | PERMALINK

In the days of the Cold War, engineers developed the concept of MIRV, Multiple Independent Re-entry Vehicles. Each missile has multiple warheads. Some of them could be destroyed by anti-missiles, but still some would get through to do their destruction.

The right-wing uses the same principle with their propaganda. It doesn't matter if some of it is debunked, some won't hear the debunking, or won't remember it months later, and the attacks do their destruction.

In fact, repeating something months later is probably very effective. After most people's attention has moved on, many will just remember that there was a controversy, and not the details of it. So, when the lie gets repeated as if it hadn't been debunked, people assume THAT is what ended up as being the "real" story they don't quite remember. Propaganda accomplished!

Posted by: biggerbox on February 21, 2009 at 12:20 PM | PERMALINK

During this weekend's McLaughlin Group, Monica Crowley (ex-Nixon aide & apologist, and delusional RightWinger), went off on a rant claiming the entire mortgage meltdown was the fault of President Clinton and the 'Community Reinvestment Act', who collectively FORCED lenders to make loans to people they knew could not repay them.

Nevermind that the CRA only applies to FEDERALLY REGULATED bank and savings & loan institutions, whereas the vast overwhelming majority of the mortgages that went bad were written by UNREGULATED private-sector predatory lenders, who were not bound by the CRA.

Stupid is as stupid does.

Posted by: Joe Friday on February 21, 2009 at 1:06 PM | PERMALINK

former dan:
political corruption extends to both major parties and The American Dream political theater that both parties use to drum up support for various housing measures that create a debt slave middle class knows no political bounds.

Posted by: ron on February 21, 2009 at 1:25 PM | PERMALINK

Alan Greenspan, maybe you've heard of him, testified under oath that this had nothing to do with the meltdown. But the Republicans still can't help blaming someone else for their own problems.

Posted by: Franklin on February 21, 2009 at 1:31 PM | PERMALINK

It might also be worth pointing out that Freddie and Fannie are doing fairly well because they didn't (couldn't by law) dig too deeply into the sub-prime mess. They also have a higher proportion of first-time buyers and lower income owners than the big banks. So the evidence for poor people causing a financial crisis seems not only bogus, but actually supports the opposite conclusion: the crisis was caused by the rich, speculators and house flippers who did business with sub-prime or negative-equity loan-makers.

But it is more important to keep an eye on the basic talking point: all our troubles are caused by the lazy and poor aided by the welfare state.

Posted by: tomj on February 21, 2009 at 1:46 PM | PERMALINK

the Glass-Steagall Act was dumped during the Clinton years due to the political influence of both parties. Larry Summers was the point man for the Clinton team dumping Glass-Steagall and also killed any attempt to provide regulatory oversight for derivative trading. Derivative trading is at the heart of our current problem using synthetic CDS to create trillions of dollars of toxic financial worthless paper that the financial elite want the taxpayer to take off their hands.

Larry is now the primary player in Obama's financial team.

Posted by: ron on February 21, 2009 at 1:51 PM | PERMALINK

I will simply say that Pat Buchanon is toxic to the political discourse of this country. But he has found himself a willling platform on MSNBC, and he can out-shout anyone with whom he is called upon to "debate." He supposedly makes the white-male resentment that he embodies "respectable," but I find him repugnant in every respect. I do not look for him to change the tune that is his very bread and butter.

Posted by: TuiMel on February 21, 2009 at 3:03 PM | PERMALINK

Ron you're an idiot. Summers and Rubin too indeed played their parts but if you want to look at the driving force behind the deregulation of Wall St. and tearing down the Glass Steagall firewalls you need go no further than Phil Gramm the head of the senate banking committee. You can start by reading this:

http://www.vanityfair.com/magazine/2009/01/stiglitz200901

Posted by: markg8 on February 21, 2009 at 4:03 PM | PERMALINK

Steve, I guess I'll say again that your innocent stylings are a sort of didactic ploy or whatever, but: surely you realize, the Rightie "commentators" keep saying this crap because they know their base keeps believing it - the latter are impervious to logical refutation, so why should the former care about being credible?

Posted by: Neil B ☺ on February 21, 2009 at 4:40 PM | PERMALINK

Wasn't it Ronald Reagan who fought to lower the capital gains tax and thereby make real estate speculation into a real industry? And at the same time mask inflation (bad) as increases in property valuation (good)?

The Republicans could never even entertain those questions or implicate St. Ronald.

Posted by: slanted tom on February 21, 2009 at 5:04 PM | PERMALINK

UBS tax scam huckster Gramm and his Enron crook wife should be in prison. Why is he on TV?

Posted by: melior on February 21, 2009 at 5:32 PM | PERMALINK

I'd say it's time to re-read Franfurt's "On Bullshit." To summarize: They may or may not know that this stuff is false, but the important point is that they don't care. They're not trying to establish a truth, they're trying to create an impression. Any statement, true of false, that effectively creates that impression (in this case, "the economic meltdown is the fault of Democrats and poor people") will be repeated.

You cannot fight bullshit with logic or argument. Debunking it and proving it baseless does not stop it. Mockery seems to have some small counter-effect, but there is no well-established way to deal with an opposition that does not care whether they are contradicted by reality, only whether they win.

Posted by: Redshift on February 21, 2009 at 5:45 PM | PERMALINK

ron,

"the Glass-Steagall Act was dumped during the Clinton years due to the political influence of both parties. Larry Summers was the point man for the Clinton team dumping Glass-Steagall and also killed any attempt to provide regulatory oversight for derivative trading."

The repeal of Glass-Steagall had nothing whatsoever to do with the current economic crisis, as it merely prevented commercial banks from owning investment banks or investment banks from owning commercial banks. It allowed the conglomeration into larger banks, but that is a completely separate issue.


"Derivative trading is at the heart of our current problem using synthetic CDS to create trillions of dollars of toxic financial worthless paper that the financial elite want the taxpayer to take off their hands."

Has nothing whatsoever to do with the repeal of Glass-Steagall. Another matter altogether.

Posted by: Joe Friday on February 21, 2009 at 6:07 PM | PERMALINK

Why on earth is anyone watching Fox news?

It is so obvious that the hosts featured are partisan ignoramuses only interested in firing up the -- equally - ignorant crowd, the kind who still think Bush was a great president (even though they are losing their jobs, have trouble making credit card payments, don't have health insurance or just lost it, and can't afford the mortgage payments on their houses, not to mention that they may have lost children in Bush's little war of choice...) and that Obama is the socialist evil incarnated. Not that they would even know what socialism is...

It is really pathetic that so many people turn to Fox News as a reliable source of information.

Posted by: gatsby on February 21, 2009 at 6:43 PM | PERMALINK

Why on earth is anyone watching Fox news?

It is so obvious that the hosts featured are partisan ignoramuses only interested in firing up the -- equally - ignorant crowd, the kind who still think Bush was a great president (even though they are losing their jobs, have trouble making credit card payments, don't have health insurance or just lost it, and can't afford the mortgage payments on their houses, not to mention that they may have lost children in Bush's little war of choice...) and that Obama is the socialist evil incarnated. Not that they would even know what socialism is...

It is really pathetic that so many people turn to Fox News as a reliable source of information.

Posted by: gatsby on February 21, 2009 at 6:47 PM | PERMALINK




 

 

Read Jonathan Rowe remembrance and articles
Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

Advertise in WM



buy from Amazon and
support the Monthly