WASHINGTON -- The decline of the New York Times
continues, alas and egad. On Monday the Times was duped
by some scoundrel who sent the newspaper's website a rude email
about Caroline Kennedy, signed supposedly by Bertrand Delanoë,
"Mayor of Paris." Now the Times has had to admit, "We
posted a letter that carries the name of Bertrand Delanoë, the
mayor of Paris, sharply criticizing Caroline Kennedy. This letter
was a fake. It should not have been published. Doing so violated
both our standards and our procedures in publishing signed
letters from our readers."
Well, I for one would like to take a look at the marmoreal
tablets proclaiming the Times' "standards." I do not
doubt that the journalists there hold to some sort of standards,
but frankly I doubt their standards have much to do with
journalism or with objectivity. Just the day before being duped
by a phony French mayor the newspaper again duped itself and its
readers. On its front page it ran an interminable report on the
provenance of the housing bubble and the subsequent nationwide
credit freeze. For months serious scholars have been laying the
blame on government housing policy that originated in the 1977
Community Reinvestment Act only to become really dangerous in the
Clinton Administration. After that the bubble ballooned and in
2007 burst.
Yet the Times, in the thousands of words it spilled out
claiming to explain the crisis, hardly mentioned the Clinton
Administration. Instead it laid total blame on the Bush
Administration and poor old George in particular. So Mayor
Delanoë's letter was the second "fake" to appear in the
Times this week. Yet I have read no apology. Do the
editors at the Times believe their tendentious work will
engender a great debate about the origins of the 2008 recession?
The American Enterprise Institute's Peter Wallison is perhaps the
country's foremost authority on the housing bubble. He has been
writing about it and speaking out for months. In the
Times' report neither he nor his thesis is even
mentioned.
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 December 21. It shows American
homeownership growth since 1990. In 1993 homeownership stood at
63%. By the end of the Clinton Administration it had grown to
68%. Through all the Bush years it grew by but 1%. 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, it is uncouth.
topics:
Housing Bubble, Peter Wallison
