Well, if the Republicans blamed the financial crisis on Elvis Presley USA Today would probably just write it up politely and then note that the Democrats disagree. That is exactly what the paper did today in an article discussing how both parties contributed to the crisis. The article notes that Phil Gramm, a former senator and adviser to John McCain, pushed through a law that prevented the Commodity Futures Trading Commission from regulating derivatives. It then presents Gramm's claim that the real problem was the Community Reinvestment Act (CRA), but notes that Democrats and "many experts dispute that." It would have been worth noting that Gramm's claim makes no sense. The CRA did not even apply to the biggest actors in the subprime market. How could the CRA be responsible for forcing financial institutions to make subprime loans when they were not even covered by the CRA. It makes as much sense to blame Elvis. In discussing the role of Fannie Mae and Freddie Mac in the crisis, it would have been useful to point out that they lost market share during the peak years of the housing bubble. Their share of the mortgage market fell from 50.1 percent in 2002 to 34.8 percent in 2006. While they did get heavily involved in junk mortgages, they lagged the private sector. They did not create the problem. It would have been useful to mention the bubble itself. Neither party thought it was appropriate to force the Fed to take steps to burst the bubble before it reached such dangerous proportions. This was their bigggest failing.
--Dean Baker