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Fact Check: The Economy By the Numbers

| August 5, 2011

Billions and billions served. (© Sam Foster)

With increasing signs that the economy is laboring, most economists agree that a short-term infusion of spending, or an extension of this year’s temporary cut in Social Security taxes, could help fend off a new downturn.

But whatever one thinks of the debt deal—and most of its billions in cuts won’t come for a few years—there’s a near-consensus in Washington against spending increases.

Here’s a brief overview of some key stats on where the economy stands.

The economy by your numbers:

–Braden Goyette, ProPublica

5 Responses for “Fact Check: The Economy By the Numbers”

  1. Nick D says:

    “…could help FEND off a downturn.”

    I hear politicians using this phrase all the time. Why are we “trying” to “fend” off when it “could” (not a guarantee) stop a downturn?”

    Why would we tossing money at a bad economy when overspending money was one the cause of the problem in the first place?

    How may time have you been watching the news and you have heard this; “There was a fire last night at the gas station on the corner…and when the fire department arrived on the scene the first thing they did to knock down the flames was put GAS ON IT!”

  2. Jack says:

    @Nick D: If you mean overspending as in two wars (and yes, Obama has continued to add to their initial costs), a Medicare prescription drug plan and multiple tax cuts for the wealthiest Americans. Then yes you are correct. You can thank Bush and his cronies for the mess, and though it’s Obama’s to deal with and clean up, it was Bush’s to start. So was TARP. And so was the housing bubble and Wall Street meltdown, which were already crashing when Bush left office. Funny how the Republicans who caused those debts are now so against paying for them.

  3. ignorancecosts says:


    Found this on NiceDebs WordPress Page, but it is easily searched for and found under : ‘Fannie and Freddie warned at least 17 times beginning in 2001’

    The media was derelict in it’s responsibility to tell the whole story about our financial collapse. As it is in so much of the current political reporting.

    ..As early as April of 2001, the Bush White House warned of coming troubles in its FY02 Budget:. ..size of Fannie/Freddie “potential problem because GSE financial trouble could cause strong repercussions in financial markets, affecting Fed.Ins. entities& economic activity.”

    May 2002 Bush calls for: “disclosure and corporate governance principles contained in his 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac. (OMB Prompt Letter to OFHEO, 5/29/02)

    January 2003: Freddie Mac announces it has to restate financial results for the previous three years.

    February 2003: Report from Office of Federal Housing Enterprise Oversight (OFHEO) “although investors perceive an implicit Federal guarantee of [GSE] obligations,” “the government has provided no explicit legal backing for them.” As a consequence, unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market. (“Systemic Risk: Fannie Mae, Freddie Mac and the Role of OFHEO,” OFHEO Report, 2/4/03).

    September 2004: Fannie Mae discloses SEC investigation and acknowledges OFHEO’s review found earnings manipulations.

    Again in Sept.2004: Treasury Secretary John Snow testifies: @House Financial Services Committee: …Congress enact “legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises” and set prudent and appropriate minimum capital adequacy requirements.

    October 2004: Fannie Mae discloses $1.2 billion accounting error.

    November: Council of the Economic Advisers (CEA) Chairman Greg Mankiw explains that any “legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk.” To reduce the potential for systemic instability, the regulator would have “broad authority to set both risk-based and minimum capital standards” and “receivership powers necessary to wind down the affairs of a troubled GSE.” (N. Gregory Mankiw, Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership, 11/6/03).


    February: The President’s FY05 Budget again highlights the risk posed by the explosive growth of the GSEs and their low levels of required capital, and called for creation of a new, world-class regulator: “The Administration has determined that the safety and soundness regulators of the housing GSEs lack sufficient power and stature to meet their responsibilities, and therefore…should be replaced with a new strengthened regulator.” (2005 Budget Analytic Perspectives, pg. 83)

    February: CEA Chairman Mankiw cautions Congress to “not take [the financial market’s] strength for granted.” Again, the call from the Administration was to reduce this risk by “ensuring that the housing GSEs are overseen by an effective regulator.” (N. Gregory Mankiw, Op-Ed, “Keeping Fannie And Freddie’s House In Order,” Financial Times, 2/24/04).

    June: Deputy Secretary of Treasury Samuel Bodman spotlights the risk posed by the GSEs and called for reform, saying “We do not have a world-class system of supervision of the housing government sponsored enterprises (GSEs), even though the importance of the housing financial system that the GSEs serve demands the best in supervision to ensure the long-term vitality of that system. Therefore, the Administration has called for a new, first class, regulatory supervisor for the three housing GSEs: Fannie Mae, Freddie Mac, and the Federal Home Loan Banking System.” (Samuel Bodman, House Financial Services Subcommittee on Oversight and Investigations Testimony, 6/16/04).


    April: Treasury Secretary John Snow repeats his call for GSE reform, saying “Events that have transpired since I testified before this Committee in 2003 reinforce concerns over the systemic risks posed by the GSEs and further highlight the need for real GSE reform to ensure that our housing finance system remains a strong and vibrant source of funding for expanding homeownership opportunities in America… Half-measures will only exacerbate the risks to our financial system.” (Secretary John W. Snow, “Testimony Before The U.S. House Financial Services Committee,” 4/13/05).


    July: Two Bear Stearns hedge funds invested in mortgage securities collapse.

    August: President Bush emphatically calls on Congress to pass a reform package for Fannie Mae and Freddie Mac, saying “first things first when it comes to those two institutions. Congress needs to get them reformed, get them streamlined, get them focused, and then I will consider other options.” (President George W. Bush, Press Conference, The White House, 8/9/07).

    September: RealtyTrac announces foreclosure filings up 243,000 in August – up 115 percent from the year before.

    September: Single-family existing home sales decreases 7.5 percent from the previous month – the lowest level in nine years. Median sale price of existing homes fell six percent from the year before.

    December: President Bush again warns Congress of the need to pass legislation reforming GSEs, saying “These institutions provide liquidity in the mortgage market that benefits millions of homeowners, and it is vital they operate safely and operate soundly. So I’ve called on Congress to pass legislation that strengthens independent regulation of the GSEs – and ensures they focus on their important housing mission. The GSE reform bill passed by the House earlier this year is a good start. But the Senate has not acted. And the United States Senate needs to pass this legislation soon.” (President George W. Bush, Discusses Housing, The White House, 12/6/07).


    January: Bank of America announces it will buy Countrywide.

    January: Citigroup announces mortgage portfolio lost $18.1 billion in value.

    February: Assistant Secretary David Nason reiterates the urgency of reforms, says “A new regulatory structure for the housing GSEs is essential if these entities are to continue to perform their public mission successfully.” (David Nason, Testimony On Reforming GSE Regulation, Senate Committee On Banking, Housing And Urban Affairs, 2/7/08).

    March: Bear Stearns announces it will sell itself to JPMorgan Chase.

    March: President Bush calls on Congress to take action and “move forward with reforms on Fannie Mae and Freddie Mac. They need to continue to modernize the FHA, as well as allow State housing agencies to issue tax-free bonds to homeowners to refinance their mortgages.” (President George W. Bush, Remarks To The Economic Club Of New York, New York, NY, 3/14/08).

    April: President Bush urges Congress to pass the much needed legislation and “modernize Fannie Mae and Freddie Mac. [There are] constructive things Congress can do that will encourage the housing market to correct quickly by … helping people stay in their homes.” (President George W. Bush, Meeting With Cabinet, the White House, 4/14/08).

    May: President Bush issues several pleas to Congress to pass legislation reforming Fannie Mae and Freddie Mac before the situation deteriorates further.

    “Americans are concerned about making their mortgage payments and keeping their homes. Yet Congress has failed to pass legislation I have repeatedly requested to modernize the Federal Housing Administration that will help more families stay in their homes, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance sub-prime loans.” (President George W. Bush, Radio Address, 5/3/08).
    “[T]he government ought to be helping creditworthy people stay in their homes. And one way we can do that – and Congress is making progress on this – is the reform of Fannie Mae and Freddie Mac. That reform will come with a strong, independent regulator.” (President George W. Bush, Meeting With The Secretary Of The Treasury, the White House, 5/19/08).
    “Congress needs to pass legislation to modernize the Federal Housing Administration, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance subprime loans.” (President George W. Bush, Radio Address, 5/31/08).
    June: As foreclosure rates continued to rise in the first quarter, the President once again asks Congress to take the necessary measures to address this challenge, saying “we need to pass legislation to reform Fannie Mae and Freddie Mac.” (President George W. Bush, Remarks At Swearing In Ceremony For Secretary Of Housing And Urban Development, Washington, D.C., 6/6/08).

    July: Congress heeds the President’s call for action and passes reform of Fannie Mae and Freddie Mac as it becomes clear that the institutions are failing.”
    All of the above information came from Nice Deb on Sept, 9 2008. She got it directly from the White House Web Site.

    Also, if you will go to You Tube, and search for Fannie Freddie Mac Hearings, the hearings themselves when Bush and McCain warned about Fannie and Freddie are actually posted for you to watch.

    Not saying they were innocent. But I am saying that the whole scheme to go against common financial knowledge and wisdom, in loaning money to people who can’t afford to pay back, set a whole lot of terrible financial play in motion. And it all started before Bush came into office.

  4. lawabidingcitizen says:


    Why confuse them with facts. Do you remember, it’s feelings that count with the left, facts are fungible.

  5. Jack says:

    @ignorancecosts: Those are common myths churned out by conservatives

    Myth #1: Fannie Mae and Freddie Mac Caused the Crisis

    The Facts
    While some are attempting to scapegoat Fannie Mae and Freddie Mac, economist Dean Baker recently stated that while Fannie and Freddie “got into subprime junk and helped fuel the housing bubble,” they were “trailing the irrational exuberance of the private sector” and actually lost market share to private subprime lenders in the years 2002-2007, when “the volume of private issue mortgage backed securities exploded.” – In a 2006 Securities and Exchange Commission filing (available here: covering its activities in 2004, Fannie Mae stated: “We did not participate in large amounts of these non-traditional mortgages in 2004 and 2005.” In the report, Fannie Mae also noted the growth of subprime lending and reported, “These trends and our decision not to participate in large amounts of these non-traditional mortgages contributed to a significant loss in our share of new single-family mortgage-related securities issuances to private-label issuers during this period.” – Additionally, Lehman Brothers CEO Richard Fuld testified before the House Committee on Oversight and Government Reform on October 6, 2008, that Fannie and Freddie’s failure played a minimal role in Lehman’s demise.

    Myth #2: Progressives have opposed strengthening oversight over Fannie and Freddie

    The Facts
    Several media figures have accused progressives in Congress of opposing stronger oversight of two mortgage giants, Fannie Mae and Freddie Mac. In fact, Rep. Barney Frank (D-MA), chairman of the Financial Services Committee, and his predecessor, Rep. Michael Oxley (R-OH) made efforts to enhance regulatory oversight on Fannie Mae and Freddie Mac, including the Federal Housing Finance Reform Act of 2005 and sponsoring the Federal Housing Finance Reform Act of 2007. Both of these bills called for a new agency to oversee and regulate Fannie Mae and Freddie Mac.

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