Here’s What’s Happening to the Economy

American Thinker | by Randall Hoven | Mar. 12, 2009

I think I have it figured out, roughly. And I’m ready to assign blame. If my narrative is not exactly true, it is a hypothesis that appears to fit the facts. This particular hypothesis is conspiracy-free, although I still think something is really fishy about the timing of the financial crisis, peaking as it did just when McCain started leading in the polls. But until we see some smoking guns, no conspiracy theory from me.

Tier 1. The US housing market was a bubble that burst, which can be blamed mostly on Democratic politicians.

Tier 2. That led to a global financial crisis because so many investment and insurance firms around the world traded in mortgage-backed derivatives that no one understood. The blame for this part is complicated; more below.

Tier 3. That financial crisis led to an over-reaction on the part of politicians. The TARP legislation in the US in particular provided the double-whammy of being largely ineffective in its own right, and signaling to investors everywhere that it is time to panic. Blame this on just about everyone in charge or wanting to be in charge: Treasury Secretary Paulson, Fed Chairman Bernake, President Bush, both presidential candidates and both parties in Congress (but mostly Democrats).

Tier 4. And that led to the political meltdown in the US, in which a socialist agenda is being implemented as quickly as possible, in the name of crisis management. Blame this one on the Democrats and the people who vote for them.

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