Let's clear the air about which political party was really in power during our economic downturnHere in Minnesota our Senate and House defeated smoking ban legislation for 3 consecutive years while Republicans dominated the St. Paul capitol. In fact in 2004 the Republican Party platform even included a plank which "opposed smoking bans in bars and restaurants". However, once Democrats were elected majority in 2006 the anti-business, economy damaging smoking bans became legislative agenda number one. The downturn in our local Minnesota economy quickly followed, it is little wonder though; since the bans closed 260+ hospitality establishments shedding approximately 10,000 local jobs.
Similarly, as of 2006 the U.S. House and Senate, like Minnesota, has been in the control of the Democratic party; perhaps you've become acquainted with the names Pelosi and Reid? This dudley duo are the Democratic majority leaders of the House and Senate which has the dubious distinction of having the lowest approval ratings in U. S. history. They have also intentionally roadblocked efforts to reduce fuel prices by not allowing oil producers the ability to drill for oil reserves right here in our country. Therefore, in reality the Democrats have been the party in power leading up to our national economic downturn.
So, if Americans truly are clamoring for change; it isn't the Democratic party that we would be voting to empower. And raising taxes on the American people is not the way to stimulate the economy, as exemplified by the fact that Republican and Democratic legislators voted to give Americans stimulus checks, not additional tax bills.
On a similar note, this article from Bloomberg details where the responsibilty for our downward spiral in the mortgage industry lies. Excerpts:
in 2005 Alan Greenspan told Congress how urgent it was for it to act in the clearest possible terms: If Fannie and Freddie ``continue to grow, continue to have the low capital that they have, continue to engage in the dynamic hedging of their portfolios, which they need to do for interest rate risk aversion, they potentially create ever-growing potential systemic risk down the road,'' he said. ``We are placing the total financial system of the future at a substantial risk.''
For the first time in history, a serious Fannie and Freddie reform bill was passed by the Senate Banking Committee. The bill gave a regulator power to crack down, and would have required the companies to eliminate their investments in risky assets.
But the bill didn't become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn't even get the Senate to vote on the matter.
That such a reckless political stand could have been taken by the Democrats was obscene even then. Wallison wrote at the time: ``It is a classic case of socializing the risk while privatizing the profit.