Bush policies were not the main cause of the financial crisis

The point of this debate is to identify Bush policies, if there were any, that caused the financial crisis. Con did not claim a single Bush policy that led to the financial crisis. He thereby effectively concedes the debate. What Con claims is that even though there were no Bush policies that led to the financial crisis, that Bush should have anticipated the crisis and accomplished policy changes to prevent it. In other words, Bush should have been all-knowing, all-powerful, and beneficent. While being god-like is certainly desirable, downright wonderful, in fact, it is not a matter of policy. A policy is a specific set of proposed actions I gave substantial evidence that the Bush Administration perceived the severe problems with Fannie Mae and Freddy Mac, and pursed a policy of trying to correct those errors. Democrats blocked the Bush efforts. That one policy would have very substantially lessened the crisis, and might well have prevented it completely by quenching the overheated real estate market. That was the Bush policy, and Bushed pressed it repeatedly. Con must explain how Bush could have accomplished his policy over Congressional opposition. Con seems to be demanding that Bush be faulted for not having dictatorial powers. Bush did not have such powers and, of course, should not have had them. Con claims, "The sub-prime crisis in itself was merely a tertiary problem to a much larger financial issue. ... it was the destruction and failure of several, often huge, businesses, trillions of dollars in wealth lost ..." Con is confusing the effect of the crisis with the cause. The cause was the subprime mortgage meltdown, the effect was as he describes. The reason that that financial institutions failed is that the loans they had made failed, and they didn't have the reserves necessary to cover them. If a mortgages require a 20% down payment, then about 20% of the loans can fail before the mortgage holders fail. That's leverage of 4 to 1. Fannie and Freddie were leveraged 140 to 1, so it took very little to bring them down. Other lenders were very highly leveraged as well, in part following the government's example that such high leverage was safe. The problem was made worse by credit default swaps, which were insurance policies against failure of the financial institutions. Those policies were highly leveraged, so the insurers could not pay and failed as well. Con did not offer an alternative explanation of the cause of the financial crisis. He offered no evidence that anything else caused the financial crisis. Con protests, "you make the claim that there was a widespread belief that housing prices could not drop substantially - this is simply an unsupported claim." The first evidence I presented was the Wikipedia article summary, saying ""The immediate cause or trigger of the crisis was the bursting of the United States housing bubble which peaked in approximately 2005–2006. ..." Additional evidence I presented was in (1), where I quoted Warren Buffet and Alan Greenspan. Buffett is renowned for his investment wisdom, backed up by his success. Greenspan was the Federal Reserve chair. These are certainly authorities. Both attributed the financial crisis to a "bubble mentality" in which the risks of real estate dropping was all but ignored. Con continued with descriptions of other economic bubbles, in which risks were largely ignored in the belief that prices could not drop. Those examples all support my point, that crisis was caused by the bursting of the housing bubble. Con states, "As President of the United States, not only was President Bush responsible for appointing regulatory agents that should have safe guarded the nation from such a disaster, it is well informed opinion that the leader of a country is a large and main factor in the direction of his party's legislative agenda and domestic policy." Was it irresponsible or negligent for Bush to not know the housing bubble would burst? Bush certainly know more that the Democrats. Bush tried to reign in Fannie and Freddie because of fear of their collapse, but Democrats successfully opposed regulation. No Democrat warned of a housing bubble about to burst. Buffet and Greenspan clearly did not know that the bubble was going to burst. So, while Bush did not avert the crisis he tried to reform Freddie and Fannie, for good reasons that completely escaped Democrats. It is the nature of economic bubbles that even the best financial minds, like Buffett and Greenspan, do not see them coming. I pointed out that Democrats blocked reform of Freddie and Fannie, and I provided the video Frank, the responsible committee chair, denouncing the Republican attempt at reform. Con says that "Certainly not all democrats blocked it, and certainly not all republicans were for it." The resolution is about whether "Bush policies" were responsible for the financial crisis. The Bush policy was to regulate Fannie and Freddie to stop them from buying up bad loans. It is irrelevant how many Republicans supported Bush policy and how many Democrats opposed. The point is that Bush policy was correct and that Democrats blocked it. If the Bush policy were wrong and it were blocked, it would have remained wrong. It was correct. Con's account was created on the same day he accepted this challenge. So I ask Con: are you a ddo member who created a second account solely to take this challenge? Just asking. Con pointed to no policy of the Bush Administration that caused the financial. Con's argument that Bush should have stopped the crisis somehow is irrelevant, but nonetheless false. Bush had better insight than the Democrats who blocked reform of Freddie and Fannie, an even the best economic thinkers, ike Buffett and Greenspan, did not foesee the crisis. The resolution is affirmed.