My Sunday Business Washington Post column is out. This morning, we look at part II of the Big Lie (Part I examined the actual factors that led to the crisis) in this part, we look at the data and factors that disprove the elements of the Big Lie.
The print version had the full headline Dissecting the big lie about the economic crisis; the online version is Examining the big lie: How the facts of the economic crisis stack up).
Here’s an excerpt from the column:
“I want to move beyond what I call “the squishy narrative” — an imprecise, sloppy way to think about the world — toward a more rigorous form of analysis. Unlike other disciplines, economics looks at actual consequences in terms of real dollars. So let’s follow the money and see what the data reveal about the causes of the collapse . . .
Consider the causes cited by those who’ve taken up the big lie. Consider New York Mayor Michael Bloomberg’s statement that it was Congress that forced banks to make ill-advised loans to people who could not afford them and defaulted in large numbers. He and others claim that caused the crisis. Others have suggested these were to blame: the home mortgage interest deduction, the Community Reinvestment Act of 1977, the 1994 Housing and Urban Development memo, Fannie Mae and Freddie Mac, Rep. Barney Frank (D-Mass.) and homeownership targets set by both the Clinton and Bush administrations.”
No graphics this week — so I created a run of charts to illustrate the facts in the main article.
click for ginormous version of print edition
Examining the big lie: How the facts of the economic crisis stack up
Washington Post, November 20, 2011