Republicans say the sorry economy is all the government's fault:
Last night during the Republican debate, Gingrich had this
... the first person to fire is Bernanke, who is a disastrous chairman of the Federal Reserve ...
... let's be clear who put the fix in: The fix was put in by the federal government.
I'm going to say one last thing. I want to repeat this. Bernanke has in secret spent hundreds of billions of dollars bailing out one group and not bailing out another group. I don't see anybody in the news media demanding the kind of transparency at the Fed that you would demand of every other aspect of the federal government. And I think it is corrupt and it is wrong for one man to have that kind of secret power.
Limbaugh had these
We are living in a destroyed economy for very learnable reasons -- very discernible reasons, inarguable reasons. It has been years since the evidence was procured. ... Everybody in that town knows what happened. Everybody in that town, including Karen Tumulty, knows what went on. They know it was Fannie and Freddie and they know it was the federal government imposing these rules on the lenders. They know it, and what infuriates me is that they continue with the lie.
And Hannity constantly references the Community Redevelopment Act.
So there you have it. It was the Fed, Fannie and Freddie, and the Community Redevelopment Act that caused the recession. Not the banks.
That will be the message in 2012 (although Romney probably will hedge)
Fannie and Freddie didn't write loans, they bought loans from banks. So somehow it's not the banks fault for writing bad loans?
(I realize Limbaugh is impervious to logic)
What is very important to understand is the sheer scale of borrowing that went on 2002-2007.
Total debt rose $6T -- from $8T to $14T, but the leverage households were taking on is best graphed like this:
All the mortgage lending averaged out to each household getting $10,000 of cash each year, 2004-2007.
This was the stealth stimulus that got the economy out of the tech recession and reelected Bush.
Once the bubble got going they were riding the tiger and could not get off.