Today, the New York Times had an article about how right-wing talk radio is gearing up to aggressively go after President-elect Obama over the next four years. Rush Limbaugh demonstrated his commitment to this crusade today on his radio show by blaming Democrats — especially Sen. Chuck Schumer (D-NY) — for starting the current economic crisis.
Here’s how Limbaugh’s conspiracy theory goes: Schumer caused on run on IndyMac bank in California this summer, in order to create a feeling of financial panic amongst the public. Democrats then capitalized on this panic with electoral wins in the White House and Congress. The purpose of gaining this power, according to Limbaugh, was to nationalize U.S. industries:
LIMBAUGH: Who’s benefiting? Aside from the people being bailed out. The Democrat party and Barack Obama are benefiting.
They got elected, they increased their numbers in the House, they increased their numbers in the Senate, they got the White House now, and they’ve got a crisis that people think can only be fixed with the all-mighty and powerful government interceding to save this or to save that, when in fact, the government is going to nationalize the automobile industry. It’s going to nationalize some banks. It’s going to nationalize the mortgage industry, and may end up nationalizing the automobile industry.
This theory is quickly becoming a right-wing favorite. Karl Rove and Bill O’Reilly also recently claimed that the economic crisis was deliberately manufactured — not by Democrats but by journalists who wanted to help elect Obama.
The economic crisis certainly wasn’t created within a five-month period, as these conservatives are claiming. As the New York Times wrote yesterday, the current situation was, in fact, long fueled by President Bush’s economic policies:
From his earliest days in office, Mr. Bush paired his belief that Americans do best when they own their own home with his conviction that markets do best when let alone. […]
As early as 2006, top advisers to Mr. Bush dismissed warnings from people inside and outside the White House that housing prices were inflated and that a foreclosure crisis was looming. And when the economy deteriorated, Mr. Bush and his team misdiagnosed the reasons and scope of the downturn; as recently as February, for example, Mr. Bush was still calling it a “rough patch.”
CAP’s Tim Westrich has more on how the “root cause of the financial mess is the hands-off approach towards mortgage and finance markets by the Bush administration, and its lack of action when a disaster was imminent.” (HT: TP reader DK)
Transcript:
LIMBAUGH: Back to this October surprise. I am just wondering — as I say, it can’t be proven — I’m just wondering if a lot of this was by design to create economic panic. Remember now — the Iraq war had dominated everything, and the economy was said to no longer be an issue in the campaign for the first time. Corruption, other things were — ethics (well, the Republicans had those problems) — but the economy wasn’t. They wanted to create economic crisis, a mindset of this.
So Chuck Schumer starts a run — a $1.3 billion run on IndyMac, and then all of a sudden, look what we learn! All these mortgages are worthless. All the mortgage derivatives and the mortgage-backed assets are worthless. Everything was worthless. There was no there there. Every institution, every guy in the institution was an empty suit. We had to bail out this, we had to bail out that; it didn’t help. I just wonder if what was a planned attempt to scare people economically — starting a run on the bank, doing this, that, and the other thing — has spun so far out of control, it’s gone so far beyond what the intention was, just to win an election, that nobody knows what to do about it.
The only mitigating argument against is that the number one, the primary beneficiary of this — and you have to look that even in an economic collapse like ours there are beneficiaries — Who’s benefiting? Aside from the people being bailed out. The Democrat party and Barack Obama are benefiting.
They got elected, they increased their numbers in the House, they increased their numbers in the Senate, they got the White House now, and they’ve got a crisis that people think can only be fixed with the all-mighty and powerful government interceding to save this or to save that, when in fact, the government is going to nationalize the automobile industry. It’s going to nationalize some banks. It’s going to nationalize the mortgage industry, and may end up nationalizing the automobile industry. […]
So the Obama team and the Democrat party are benefiting tremendously from this, even if it has spun out of control. It’s spun out of control, but they’ll make due with a new crisis they created a la Rahm Emanuel. But the reason I think it has spun a little out of control and gone a little further than they intended is that even the Obama people are saying, “Hey, it’s going to be really bad for a really long time.”
Source: Think Progress
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