Emmett Tyrrell

In the next issue of The American Spectator, Wallison will explain: "Two narratives seem to be forming to describe the underlying causes of the financial crisis. One, as outlined in a New York Times front page story on Sunday December 21, is that President Bush excessively promoted growth in home ownership without sufficiently regulating the banks and other mortgage lenders that made the bad loans. The result was a banking system suffused with junk mortgages, the continuing losses on which are dragging down the banks and the economy. The other narrative is that government policy over many years -- particularly the use of the Community Reinvestment Act and Fannie Mae and Freddie Mac to distort the housing credit system -- is what underlies the current crisis."

Wallison supports the second narrative and has no difficulty winning his case. Most devastatingly, he cites the Times' own published chart from Dec. 21. It shows American homeownership growth since 1990. In 1993, homeownership stood at 63 percent. By the end of the Clinton administration, it had grown to 68 percent. Through all the Bush years, it grew by but 1 percent. Equally devastating, Wallison recalls a 1999 news story from the Times reporting that the Clinton administration was importuning on Fannie Mae and Freddie Mac to relax standards and extend lending to low-income homebuyers. What Wallison is too gentlemanly to add is that in this 1999 story, the Times quotes a housing expert who warns that the Fannie and Freddie policies might require a government bailout. The housing expert's name is Wallison.

So revealing the fakery of this news report is not difficult. But what is also worth mentioning is that the Times, in its ambitious partisanship, has created another political controversy that need not have been created. The origin of this bubble and credit freeze is clear. How to resolve it and prevent similar crises is the question to be addressed today. Instead, the Times wants -- so to speak -- to throw shoes at George Bush. The Times is not only unreliable but also uncouth.

Emmett Tyrrell

R. Emmett Tyrrell Jr. is founder and editor in chief of The American Spectator and co-author of Madame Hillary: The Dark Road to the White House.
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