Obama Worse Than Bush On The Economy? Go Figure...

Image credit: Parody by Cujo359 (See NOTE)

You won't have to look very hard around here to see me declaring that I think there is no real difference between Mitt Romney and Barack Obama on economics issues. All you really have to do is look for this poster, and start reading. Matt Stoller may disagree with that notion, but not in the way you might think.

Discussing a recent interview Barney Frank gave to the New Yorker, in which Frank said that President Obama declined Bush Administration finance guru's offer to start a program of mortgage write-downs following the Crash of 2008, Stoller writes:

In fact, crisis response is the single most significant policymaking time imaginable, because all structural barriers are swept away. Think about it – this was literally a deal offered by Hank Paulson – one guy – to Barack Obama, with a multi-trillion dollar impact. No 60 votes in the Senate. No hearings. No confirmations. Just a handshake, basically. In other words, policy does matter, and Obama had a variety of choices and leverage, and he did what he thought was best. He did not want to write down mortgages, even though he was offered that choice by the Bush administration and Barney Frank. So he didn’t.

So yes, Barack Obama is worse than George Bush on economic inequality. While Paulson didn’t want to write down mortgages, the single biggest factor in determining whether the American middle class has any stored wealth, Paulson was willing to do so in response to pressure. Barack Obama was not.

Barney Frank: Obama Rejected Bush Administration Concession to Write Down Mortgages

Mortgage write-downs were something that was discussed rather often back then, because one of the reasons for the crash, and one of the reasons the recovery has been so slow and painful, is that there were so many homeowners whose mortgages were "underwater", meaning that the amount the homeowners owed was more than the houses were worth. Write-downs would have helped them stay in their homes, yet keep paying off some part of the debt. Instead, Obama chose the foolish course of trying to prop up the banks.

Given that it was the Bush Administration that first aided the auto industry with loan guarantees, I am not at all doubtful of this story. Nor is it counter to what we know about Obama's economic policies.