More Iraq War Revisonist History… From A Historian Complaining About Revisionist History.

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Victor Davis Hanson has a piece out with the headline “Revisionist History Prevails on Iraq Invasion“.

Yes. It does. But it’s who is doing it that is the problem.

VDH writes:

“Do we remember that Bill Clinton signed into law the Iraq Liberation Act of 1998 that supported regime change in Iraq? He gave an eloquent speech on the dangers of Saddam Hussein’s weapons of mass destruction. “


Thing is, Bill Clinton and the Dems didn’t act on it. It’s one thing to authorize something in Congress, which was meant as a threat. But everyone knew it was an empty threat. It’s one thing to support regime change, as we also do in regard to the Cuban government, and quite another to actively do so with out military. We were NOT going to go back into Iraq as things stood in 1998. And the intelligence was not that detailed, not nearly as specific as the evidence Bush laid out in as the rational to invade.

“In 2002, both houses of Congress voted overwhelmingly to pass a resolution authorizing the removal of Saddam Hussein by force. Senators such as Joe Biden, Hillary Clinton, John Kerry and Harry Reid offered moving arguments on the Senate floor why we should depose Saddam in a post-9/11 climate.

Democratic stalwarts such as Sen. Jay Rockefeller and Rep. Nancy Pelosi lectured us about the dangers of Saddam’s stockpiles of weapons of mass destruction. They drew on the same classified domestic and foreign intelligence reports that had led Bush to call for Saddam’s forcible removal.”

They voted yes due, in part, on the faulty and manipulated intel presented by the Bush administration. See more below.

“Legally, the U.S. went to war against Saddam because he had done things such as commit genocide against the Kurds, Shiites and the Marsh Arabs, and attacked four of his neighbors. He had tried to arrange the assassination of a former U.S. president, George H.W. Bush. He had paid bounties for suicide bombers on the West Bank and was harboring the worst of global terrorists. Saddam also offered refuge to at least one of the architects of the first World Trade Center Bombing in 1993, and violated U.N.-authorized no-fly zones.”

Legally… Yes. But the argument that Saddam was building a stockpile of WMD’s was the linchpin to getting approval to go to war. Minus the WMD factor, we never went to war in any of the African countries doing the exact same things… Or worse.

Genocide… Attacking neighbors. Those were all things done in the 80’s and 90’s by all sorts of countries around the world. That’s never been justification in our modern history for us putting an invading army on the ground to overthrow a government. Paying suicide bombers? That was more recent. But we were not going to war over that either. Saddam certainly was not the only one doing that. Members of the Saudi Royal family were providing funds. Iran was much more active than those two in that regard.

None of this was ever enough to committing our ground troops to war. Fear of chemical and nuclear weapons was, and we know that most of that intel was wrong at best, manufactured and not vetted at worst.

Hanson goes on:

“The Bush administration, like members of Congress, underestimated the costs of the war and erred in focusing almost exclusively on Saddam’s supposed stockpiles of weapons.”

Yeah they did. And concerning Congress…. Where did they get the monetary and time-line estimates from???? Last time I checked, those are provided by the Executive branch. Congress, based on information provided by that branch, either provides the funding, or tightens the purse strings.

“But otherwise, the war was legally authorized on 23 writs. Most of them had nothing to do with weapons of mass destruction and were unaffected by the later mysterious absence of such weapons…”

Mysterious absence… Really?????

The absence of such weapons is not a mystery… They didn’t exist in the first place. In all the TONS of both official  AND private documents recovered from the ouster of Saddam and his government, there is NO EVIDENCE that Saddam had any newer WMD’s from his supposed “reconstituted programs”. The only thing that was ever found in country were useless and degraded scraps of WMD’s left over from the 80’s and 90’s.

“…which is all the more mysterious given that troves of WMD have turned up in nearby Syria and more recently in Iraqi bunkers overrun by Islamic militants.

Has anyone seen any, you know,  actual evidence that Syria’s chemical weapons came from Iraq? Juan Cole lays out a pretty compelling case that most of the Syrian stockpiles came from Russia and some Western European companies, complete with links that back his assertion.

“A Special National Intelligence Estimate dated Sept. 15, 1983, lists Syria as a “major recipient of Soviet CW [Chemical Weapons] assistance.” Both “Czechoslovakia and the Soviet Union provided the chemical agents, delivery systems, and training that flowed to Syria.”…

Last week, German newspaper Süddeutsche Zeitung reported that intelligence sources in the country are convinced blueprints for four of the five Syrian poison gas plants came from Moscow….

…Syria received precursor chemicals from the West until well into the last decade. Last week, the German government acknowledged that between 2002 and 2006, it had approved the export to Syria of more than 100 tons of so-called dual-use chemicals. Among the substances were hydrogen fluoride, which can be used to make Teflon, and also sarin. The exports were allowed under the condition that Syria would only use them for civilian purposes. The British government also recently acknowledged exports of dual-use chemicals to Syria.”

What evidence does Hanson bring to the table to support his claim that Syria’s WMD’s came from Iraq???? About the same amount of evidence that currently supports the claim that Saddam was rebuilding his WMD stockpiles… None.

More Hanson:

“What changed public opinion and caused radical about-faces among the war’s most ardent supporters were the subsequent postwar violence and insurgency between 2004 and 2007, and the concurrent domestic elections and rising antiwar movement. Thousands of American troops were killed or wounded in mostly failed efforts to stem the Sunni-Shiite savagery.”

Interesting that Hanson leaves out a vital factor that weighed on the American public at the same time and help fuel the rise in anti-war sentiment… The realization that the administration was DEAD WRONG on the presence of weapons of mass destruction in Iraq. Had we found them, or even any proof that Saddam was reconstituting his programs, as the administration had asserted with steely-eyed certainty, we would have almost certainly sent more troops in at the beginning of the invasion, and kept more there to find and destroy those weapons. From the beginning of the campaign to include Iraq as a front in the Global War On Terror, the Bush administration made that the centerpiece on which to justify the action. The failure to mention the growing concern about the total absence of proof for a WMD program at all is a lie by omission on Hanson’s part. Talk about revisionist history!!!!
He mentions the freedom the Kurds now enjoy. Yes, they are better off than they were under Saddam’s rule. But that was not the compelling reason we went to war there. And, it’s not as if they were liberated by our invasion. Their fate was already improving as a result of the no-fly zones we set up in the 90’s to protect them. From our own Stars and Stripes:

“The Other Iraq,” as residents like to call it, has enjoyed peace, stability and an improving economy for more than 20 years, since the U.S. instituted a no-fly zone over the region following the first Gulf War in 1991. Protected from Saddam Hussein by the no-fly zone, Iraqi Kurds developed a modern infrastructure and a rare secular, pro-Western, democratic regime.

“It led to huge progress for our economy,” said Dara Jalil-Khayat, president of the Irbil Chamber of Commerce.”

Continuing with Hanson:

“A Saddam-led Iraq over the last decade would not have been a peaceable place.”

No kidding! But was it a peaceable place in 2009, not even four months after  Bush signed the agreement with Maliki that solidified the withdrawal time line? Yes, less Americans were getting killed at the time. But Iraq was hardly a Nirvana of peace and prosperity where everyone was singing kumbaya.

Here is how peaceful it was right after we signed the agreement, and our boot were still very much on the ground:

  • “June 20, 2009 – A suicide bomber detonates a truck filled with explosives as crowds of worshipers leave the Shi’ite al-Rasul mosque in Taza, near Kirkuk. At least 73 people are killed and more than 250 wounded.
  • June 24 – A bomb kills 72 people at a busy market in eastern Baghdad’s Sadr City. At least 127 people are wounded.
  • August 19 – At least six blasts strike near government ministries and other targets in Baghdad, killing 95 people and wounding 536.
  • October 25 – Twin car bombs target the Justice Ministry and the Baghdad provincial government building, killing at least 155 people and wounding more than 500 in central Baghdad.
  • December 8 – At least four car bombs explode in Iraq’s capital, near a courthouse, a judges’ training center, a Finance Ministry building and a police checkpoint in a district of southern Baghdad. At least 112 people are killed and hundreds wounded”

Even todays stories still reference the sectarian violence that occurred even as the surge was under way between 2006 and 2008:

“Sectarian violence in Iraq continues to worsen as clashes erupt between Sunni and Shia groups. According to the United Nations, more than eight thousand people were killed in 2013—the highest number of fatalities since the upsurge in civil violence between 2006 and 2008.”

Our troops, sent in under the surge, were not just fighting against al-Qaeda in Iraq, but against the sectarian Mehdi Army and missioned to clamp down on sectarian violence. In fact, google “Iraq al-Qaeda 2006” and the thing the are most noted for is bombing a Shiite mosque, which brought the sectarian violence to a head. Note that al-Queda’s favorite method of attacks is not on the battle field, but the classic terrorist M.O…. Blowing things up in civilian centers. Here is a list of pre-2010 activity:

  • June 20, 2009: Truck bombing of a Shi’i mosque near Kirkuk blamed on Al Qaeda in Iraq: at least 75 killed, 163 wounded.
  • August 14, 2007: Multiple truck bombings of two Yazidi villages near Sinjar in northern Iraq: at least 500 killed, approximately 1,500 wounded.
  • March 6, 2007: Two car bombings at a Shi’i shrine in Hilla: 106 killed.
  • November 23, 2006: Series of car bombings and mortar attacks in the Shi’i Sadr City: at least 202 killed, approximately 250 injured.
  • February 22, 2006: Bombing of the Shi’i Al Askari Mosque in Samarra, which sparked a “civil war” between Sunnis and Shi’as in Iraq.
  • July 16, 2005: Suicide car bomb struck a fuel tanker truck in Musayyib: at least 98 killed, 82 wounded.
  • February 28, 2005: Suicide car bombing in Hilla: at least 125 killed, 170 wounded.
  • October 24, 2004: Coordinated vehicle bombings outside Baghdad’s Sheraton and Palestine hotels, which were frequented by members of the Western press: at least 20 killed.
  • May 17, 2004: Suicide car bombing killed Governing Council President Izzedin Salim.
  • October 27, 2003: Multiple car bombings at police stations and Red Cross Headquarters in Baghdad: 35 killed, 220 wounded.
  • August 19, 2003: Truck bombing at U.N. headquarters in Baghdad: 23 killed, including Sergio Vieira de Mello, the U.N. High Commissioner for Human Rights.

The same article notes:

“The threat of AQI has weakened in recent years due to a backlash from local Sunnis and the surge of American troops in Iraq in 2007. Local Sunni populations increasingly separated themselves from AQI and its affiliate groups because they used intimidation tactics to enforce allegiance and impose strict Islamic codes. AQI has subsequently focused its efforts against the U.S. in Afghanistan, and, according to congressional reports, some AQI leaders have joined Al Qaeda in the remote tribal areas near Afghanistan’s border with Pakistan.

We may have flushed some of al Qaeda out of Iraq, but they weren’t “defeated”, as Hanson and others love to portray. The bombings in Iraq from 2009 to 2011 show otherwise. We didn’t “decimate” them into non-existence, but suppressed them at best. They just moved to another, more favorable, battlefield. They adjusted their tactics, and we falsely and foolishly painted it as some sort of defeat.

Back to the weapons of mass destruction issue one more time. Bush, in this and many other interviews, said this and things similar to this:

“I also saw a threat in Iraq. I was hoping to solve this problem diplomatically. That’s why I went to the [United Nations] Security Council; that’s why it was important to pass [Resolution] 1441, which was unanimously passed. And the world said, disarm, disclose, or face serious consequences — and therefore, we worked with the world, we worked to make sure that Saddam Hussein heard the message of the world. And when he chose to deny inspectors, when he chose not to disclose [emphasis added], then I had the difficult decision to make to remove him. And we did, and the world is safer for it.”

And then there is this from Bush, again justifying the invasion and overthrow of Saddam Hussein. Form an article coincidentally titled “Look who’s rewriting history now” discussing the false claim made by Bush that Saddam did not let inspectors in to look for WMD’s:

The fundamental question is, did Saddam Hussein have a weapons program? And the answer is, absolutely. And we gave him a chance to allow the inspectors in, and he wouldn’t let them in. And therefore, after a reasonable request, we decided to remove him from power, along with other nations, so as to make sure he was not a threat to the United States and our friends and allies in the region.”

Hanson noted the 23 legal writs that were used to support going to war with Iraq. In how many interviews and speeches did Bush say to the world “If Saddam doesn’t stop killing the Kurds, then he will face the consequences and be removed from power!”. Or substitute killing the Kurds with any of the other 23 legal writs. Sorry. It ain’t there. Without the addition and continued assertions that Saddam had rebuilt his stockpiles of WMD’s, we would not be looking at the situation in Iraq as it stands. It would still almost certainly be crappy, but our hands would not be dirty, at least, not as dirty as they are now.

When the topic is ancient history, Victor Davis Hanson is a fine historian. But when it comes to modern politics, he’s as blind as they come.

Early in the piece, Hanson writes:

“One can blame almost anyone, but one must not invent facts to support an argument. “

No. All one has to do is ignore them, which is why we’re in this mess in the first place.

SIDE NOTE:  In mid 2006, one pol from Harris showed that 50% of the country still believed that Saddam DID have WMD’s. But that number was almost certainly the result of a report put out by Senator Rick Santorum and Representative Peter Hoekstra that showed that we had found lots of WMD’s in Iraq.


Here is the Headline from FOX News:

Report: Hundreds of WMDs Found in Iraq

Here is how Santorum framed his report in a write-up in the Washington Times:

“We have found weapons of mass destruction in Iraq,” Mr. Santorum said in a press conference yesterday afternoon. “This is an incredibly … significant finding. The idea that, as my colleagues have repeatedly said in this debate on the other side of the aisle, that there are no weapons of mass destruction, is in fact false.”

Here is what Santorum and the Conservative outlets didn’t care to reveal. From a Washington Post article:

But the Pentagon and outside experts stressed that these abandoned shells, many found in ones and twos, were 15 years old or more, their chemical contents were degraded, and they were unusable as artillery ordnance. Since the 1990s, such “orphan” munitions, from among 160,000 made by Iraq and destroyed, have turned up on old battlefields and elsewhere in Iraq, ex-inspectors say. In other words, this was no surprise.

“These are not stockpiles of weapons of mass destruction,” said Scott Ritter, the ex-Marine who was a U.N. inspector in the 1990s. “They weren’t deliberately withheld from inspectors by the Iraqis.”

Once again, another lie by omission from Conservative media and their pundits. I was still a registered Republican at this time. And I still believed that we surly MUST find something. And when the news broke that this Samtorum / Hoekstra report blew the lid off the “liberal media lies” or what not, I was thrilled. At least we have this.

But when this was revealed to have been another in a long list of distorted truths, I stopped trusting them. That doesn’t mean that Conservative media is always wrong. No. But I don’t buy what they sell unless it’s confirmed by independent sources. Same rule goes for “liberal” media too.

Songwriting – How Much Do Our Influences Infiltrate Or Songs????

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For songwriters, there is always the internal pressure to come up with something “new” and “original”. There is almost always that voice in your head while writing that will say “Oh, that sounds too much like that other song”. And in the cases when you think you’re in the clear because you can’t think if anything that resembles what you wrote.

I know I have a lot of influences that shape the “Mike Alexander” sound. When I was a younger songwriter, I was very conscious of that, and if I realized there were similarities to another song, I would change things so that the similarities got squeezed out of a song if possible.

But I think I’m at a place where I’ve come to embrace those influences.

As a young teen, before AC/DC whacked the sense out of me and turned me onto harder edged rock, I was a HUGE ELO fan. I played “A New World Record” and Out Of The Blue” to death! For the longest time, from my middle teens to probably my middle thirties, I kind of hid my extreme affection for ELO because it kind of wasn’t the cool thing for a while. I got over that thank God!!!! It helped that Supertramp was also a favorite, and never got the same treatment / scorn of being syrupy pop, and I was able to bundle to two up into one compartment of music to admire. My love for Supertramp was always open for the world to see, but I kept my love for ELO private. By the time I turned 40, “Mr. Blue Sky” was in half the commercials on TV, so it was safe to come out of the ELO closet!

You can try and put away some ancient influence from your youth, but they have a way of sneaking out. Now that I’m arranging a lot of my songs to prep for the solo project, I’m seeing Jeff Lynne’s influence on my writing all over the place. It’s not surprising though. The very first song I ever wrote, a thing called “Insanity” is now in my set list. I know I was listening to OOTB when I wrote it, and there are some smidgens of “Big Wheels” in the song. I didn’t realized they had seeped into the structure of the song at the time because I couldn’t play it, but now that I can, I can definitely hear the echo there. For a while I never thought that much of the thing. I thought it was too simple. It was my first song and I didn’t have a clue how to write a song. Now that I’m performing it though…. I’m really digging the simple yet primal drive that the song evokes.

I’ve fallen in love with my own song!

I guess I’ll have to vid it and put it on YouTube tomorrow.

PS. It will probably be the first song on my debut solo album that comes out early next year.

A Letter To Dick Cheney – Congratulations On Your Stunning Victory In Iraq.

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So, yesterday, the Wall Street Journal published an op-ed by Ex_Vice President Dick Cheney, blasting now President Barrack Obama for screwing up the middle East, saying about Obama:

“Rarely has a U.S. president been so wrong about so much at the expense of so many,”


“Instead, he abandoned Iraq and we are watching American defeat snatched from the jaws of victory.”

When FOX News talking head Megyn Kelly calls him on this silliness, you know things are not great in Cheney-land.

Since the rest of the interview was all cotton candy and lollipops for Mr Cheney, I suspect one of Mrs Morgan’s producers chewed her out through her ear-piece to cut it out… He’s one of ours!

As many have already noted, I’ll remind the distinguished Ex-Vice President that his boss, George W. Bush, signed the papers that pulled the US Military out of the Iraq theater, not Mr Obama. And Iraqi Prime minister explicitly demanded that the pullout be complete, and no US forces were to remain in country.

I’m going to reply to Dick Cheney’s response here:

To Ex-Vice President Dick Cheney.

I just saw your response to Megyn Kelly on a FOX News interview… And I must say… I’m appalled.

You said this in reply to her statement that you got a lot of things wrong concerning Iraq:

“Well, I just fundamentally disagree, Megyn. You’ve got to go back and look at the track record. We inherited a situation where there was no doubt in anybody’s mind about the extent of Saddam’s involvement in weapons of mass destruction. We had a situation where if we — after 9/11, we were concerned about a follow-up attack, it would involve not just airline tickets and box cutters as the weapons, but rather something far deadlier, perhaps even a nuclear weapon.

Saddam Hussein had a track record that nearly everybody agreed to. We had an overwhelming vote of approval from the Congress. More votes for the action than we’d had in Desert Storm some ten years before. Bill Clinton, Nancy Pelosi, numerous others, spoke to the difficulties of the intelligence that all of us saw with respect to the threat that Saddam Hussein represented.

It would have been irresponsible for us not to act. We did do the right thing…”

(complete reply here)

We inherited a situation where there was no doubt in anybody’s mind about the extent of Saddam’s involvement in weapons of mass destruction.

Are you KIDDING ME?????

You were the Vice President Of the United States! You don’t act on rumors of what Saddam might have, or what this Congressman or that Congressman say… YOUR EXECUTIVE BRANCH is in charge of the CIA, NSA, and other intelligence gathering agencies. It’s your job to make sure that the rumors about Saddam and Weapons of Mass Destruction and his involvement with al-Qaeda are actually correct!

You failed sir!

In fact, several personnel within the intelligence agencies that were ALL saying “Whoa! We’re not finding evidence of you are claiming”. You, Mr Ex Vice President, didn’t like those answers, so you forged ahead and built your own pile of evidence, cherry-picking things and excluded anything that would throw doubt on your case for war. There was LOTS in intel that cast serious doubt on many of the assertions you and the administration were making at the time. But anyone who spoke out to try and show your evidence wasn’t concrete was quickly quieted through various means of intimidation.

You set up a false narrative.

AND you made damned sure that that was the ONLY narrative that Congress would get. You Sir, acted as a gatekeeper to filter out any information that would foster doubt on the rational behind the Iraq invasion that you and your fellow Conservatives SO DESPERATELY WANTED.

Saddam was a bad guy. No question there. Iraq was indeed broken before we got there.


But you broke it even more. You say this in your op-ed:

“When Mr. Obama and his team came into office in 2009, al Qaeda in Iraq had been largely defeated, thanks primarily to the heroic efforts of U.S. armed forces during the surge,”.

On the first part – Al-Qaeda in Iraq…

I guess someone should remind you of another one of your “been so wrong” assertions… Al-Qaeda did NOT have much of a presence in Iraq! At least until our invasion drew them there to fight us!

Al-Qaeda does not belong to any one state Sir! There is no such thing as the Iraq al-Qaeda! They don’t call one place home. Home for them is temporary; it’s where the opportunity is. In 2009 and 2010, they were more active in Algeria and Yemen and even Jordan. Then when the Syrian protests became a civil war, that is where they went. And now, they’ve circled back, NOT because of Obama’s “weakness”, as Cheney and others assert, but because the guy who actually runs the place, Maliki, the guy who demanded that we not have a presence there, has created a power vacuum and fomented anger against his own government by sidelining Sunni populations, a practice YOUR ADMINISTRATION endorsed by the de-Bathification of the Iraq government and military after YOU invaded and took over the country!

And, oh, look! The ink on the withdrawal agreements had barely dried before the supposed defeated al-Qaeda in Iraq reared it’s ugly head!

“June 20, 2009 – A suicide bomber detonates a truck filled with explosives as crowds of worshipers leave the Shi’ite al-Rasul mosque in Taza, near Kirkuk. At least 73 people are killed and more than 250 wounded.

June 24 – A bomb kills 72 people at a busy market in eastern Baghdad’s Sadr City. At least 127 people are wounded.

August 19 – At least six blasts strike near government ministries and other targets in Baghdad, killing 95 people and wounding 536.

October 25 – Twin car bombs target the Justice Ministry and the Baghdad provincial government building, killing at least 155 people and wounding more than 500 in central Baghdad.

December 8 – At least four car bombs explode in Iraq’s capital, near a courthouse, a judges’ training center, a Finance Ministry building and a police checkpoint in a district of southern Baghdad. At least 112 people are killed and hundreds wounded.”

Defeated huh…. Does this look like al-Qaeda was defeated to anyone????

Thy weren’t “defeated”. They just did what all terrorist groups do, they went a bit more underground.

And note: Our military WAS STILL THERE.

On the second part – Your trillion dollar adventure, in which almost 4500 soldiers died, and many many more came back wounded and will be scarred and / or disabled for life, completely destroyed the delicate , if ugly, balance that was the Middle East. And we shock-and-awe’d that to death!

You guys wanted to be the catalyst for change in the Middle East….

Well. Congratulations.

Mission Accomplished Dick!

PS. Interesting to note… There is always a lot of criticism of Barrack Obama bypassing Congress to get things done, something that is considered illegal. You hear about this all the time on Conservative talk radio, and that this should be grounds for impeachment.


But why wasn’t the same thing grounds for impeachment when former President George W Bush illegaly bypassed Cangress when he signed the Iraq withdrawal agreement with Maliki in December of 2008.

The Great Recession Revisited.

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Recently, a facebook friend posted an old Forbes article from 2009, blaming the entire financial crisis on the Federal Government. I wrote a couple of previous posts here and here rebutting that idea, but I thought it would be interesting to look at it in relation to the specific Forbes article in question. Lets take a look at the details.

The Forbes article states at the very beginning:

“the collapse of the bubble would not have led to a worldwide recession and credit crisis if almost 40% of all U.S. mortgages–25 million loans–were not of the low quality known as subprime or Alt-A.”

False. The number was not 40%. It was about half that, at 21% for it’s highest figure. That peaked in 2004.


“These loans were made to borrowers with blemished credit, or involved low or no down payments, negative amortization and limited documentation of income.”

The first part… That has been a feature of subprime loans since… Well.. Since that financial vehicle was invented by banks in the first place. Let’s look at a bit of history about the creation of the subprime loan:

Many factors have contributed to the growth of subprime lending. Most fundamentally, it became legal. The ability to charge high rates and fees to borrowers was not possible until the Depository Institutions Deregulation and Monetary Control Act (DIDMCA) was adopted in 1980. It preempted state interest rate caps. The Alternative Mortgage transaction Parity Act (AMTPA) in 1982 permitted the use of variable interest rates and balloon payments. These laws opened the door for the development of a subprime market, but subprime lending would not become a viable large-scale lending alternative until the Tax Reform Act of 1986 (TRA). The TRA increased the demand for mortgage debt because it prohibited the deduction of interest on consumer loans, yet allowed interest deductions on mortgages for a primary residence as well as one additional home.

Note that the development of the subprime mortgage was encouraged by the Community Reinvestment Act, signed into law in 1977.

“The loans’ unprecedentedly high rates of default are what is driving down housing prices and weakening the financial system.”

And on that, Forbes notes:

“On a parallel track was the Community Reinvestment Act. New CRA regulations in 1995 required banks to demonstrate that they were making mortgage loans to under-served communities, which inevitably included borrowers whose credit standing did not qualify them for a conventional mortgage loan.”

The author of the article in question note:

“In 1992, Congress gave a new affordable housing “mission” to Fannie and Freddie, and authorized the Department of Housing and Urban Development to define its scope through regulations….

Shortly thereafter, Fannie Mae, under Chairman Jim Johnson, made its first “trillion-dollar commitment” to increase financing for affordable housing. What this meant for the quality of the mortgages that Fannie–and later Freddie–would buy has not become clear until now.”

OK. But how much did subprime mortages grow in this period?

It did experience growth in this peroid, but it didn’t take off. It only started it’s astronomical rise in and after 2003. What caused this suddden rise? Again, to Forbes:

“Shortly after these new mandates went into effect, the nation’s homeownership rate–which had remained at about 64% since 1982–began to rise, increasing 3.3% from 64.2% in 1994 to 67.5% in 2000 under President Clinton, and an additional 1.7% during the Bush administration, before declining in 2007 to 67.8%.”

Forbes then says:

There is no reasonable explanation for this sudden spurt, other than a major change in the standards for granting a mortgage or a large increase in the amount of low-cost funding available for mortgages. The data suggest that it was both. ”

“From 1994 to 2003, Fannie and Freddie’s purchases of mortgages, as a percentage of all mortgage originations, increased from 37% to an all-time high of 57%, effectively cornering the conventional conforming market.”

First, here is a chart showing just how badly Freddy and Fannie were eclipsed by privately issued subprime loans.

Note that the government organization only increased their purchasing of loans as the private sector grew, and never enough to meet the pace.

And there still was no financial meltdown in 2003. That didn’t come about until 2007 / 2008. What was Fannie Mae / Freddy Masc ownership like then?

Here’s a chart showing total ownership in 2006, approaching the height of the housing boom.

So nope, Forbes is wrong on this point as well.

Forbes had claimed this:

“From 1995 until 2004, subprime loans by the traditional subprime lenders like Countrywide averaged slightly more than 5% of all mortgages, far too few to account for the growth in either homeownership or the housing bubble.”

Obviously, that doesn’t jibe with the chart above.

So, why did that spike so hard after 2004? Speculation in the mortgage markets. (taken from this article)

The question here is… Why would housing loans take down the entire financial system???? There are a couple of puzzle pieces that are missing throughout the whole article… Mortagae Backed Securities (MBS’s).

Yes, the government did encourage more lending to those with lower incomes, but it was doing that for a decade before the bubble formed, and the housing market didn’t explode in either the economic downturn at the bursting of the dot-com bubble, or the economic dip that occured after the 9/11 attacks.

But, the government did not require the banks to issue loans with absolutely no credit check, or issue loans with no background check to make sure the applicant even had a job. The government did not require the banks to sell, and resell, and repackage, and resell those repackaged loans until no one had ny idea what they were buying. The government did not do this. The banks did. To blame the government is like saying it’s my dad’s fault that I robbed the bank because he threatened that if I don’t go out and earn money to pay rent, he’s going to kick me out of the house.

The reason the housing market brought the whole financial system to its knees is because the system had been way overexposed thought the over-investment in mortgage backed securities bound together by unregulated credit default swaps.

Futher, Forbes wishes to make the CRA the culprit in the mess, by saying that the CRA regulations caused the mess. Did it? Barry Ritholtz note:

“if the CRA was to blame, the housing boom would have been in CRA regions; it would have made places such as Harlem and South Philly and Compton and inner Washington the primary locales of the run up and collapse. Further, the default rates in these areas should have been worse than other regions.

What occurred was the exact opposite: The suburbs boomed and busted and went into foreclosure in much greater numbers than inner cities. The tiny suburbs and exurbs of South Florida and California and Las Vegas and Arizona were the big boomtowns, not the low-income regions. The redlined areas the CRA address missed much of the boom; places that busted had nothing to do with the CRA.”

He notes that by 2006, only 28% of all mortgage originated in banks that fell under CRA jurisdiction. Also, he points out that those mortgages that were issued though CRA actually defaulted LESS than those issue outside that system, which were the types of loans that Countrywide swam in.

One last piece of informantion that discredits the “Blame The CRA” meme… The housing crisis was NOT just isolated to the US, it was world-wide. Please tell me how the United States Governments CRA regulations caused the housing markets in Spain, Belgium, the UK, and a host of other countries to experience an even more severe housing bust than we had?

They don’t share the US CRA policies. What they do share, are the same finincial institutions and flawed investment practices that created the financial mess.

That Forbes piece is just short of being propaganda, as some of the figures are wrong, inflated, and totally one sided. But what do you expect from a magazine that caters to the business class.

PS. I am one of that class as I own my own business.