In linking the meltdown in the financial sector to George W. Bush's economic policies of deregulation in banking, Barack Obama, during the presidential debate, Sept. 26, said that the crisis "is a final verdict on eight years of failed economic policies promoted by George Bush, supported by Senator McCain."
But, during the debate, John McCain refused to share in any responsibility for the Bush economic philosophy of deregulation and reduced oversight that reigned over the financial debacle that hit Wall Street in recent weeks and insisted that he didn't agree with Bush's views on economic policy. John McCain's own past words, however, tell a different story.
For the past eight years, John McCain has boasted that his economic philosophy is based on deregulation. In 2000, while running for the Republican president nomination, McCain said, "I am a proud Republican conservative with a 17-year record of voting ... for less regulation."
Three years later, in a Senate Commerce committee hearing, which he chaired, McCain repeated, “I have a long voting record in support of deregulation.” Again that same year, McCain told CNN that “I am a deregulator. I believe in deregulation.”
During this presidential primary campaign, McCain described the issue of deregulation as a fundamental difference between himself and Barack Obama. “I think the important thing is that there will be stark differences between either Senator [Clinton] or Senator Obama and me [is] … whether we have more regulation or less regulation.”
Just prior to the failure of Bear Stearns, the first major US bank to collapse in the current systemic crisis, McCain told the Wall Street Journal, “I am fundamentally a deregulator. I'd like to see a lot of the unnecessary government regulations eliminated, not just a moratorium.”
Even as economists warned that the housing crisis would harm the financial sector last March, John McCain insisted on CNN, “I’m asked all the time are we in a recession or not in a recession.... Let’s reduce it. Let’s reduce regulation.”
After Bear Stearns failed and a massive financial crisis loomed, McCain again called for deregulation and reduced oversight of the activities of Wall Street players. In late March, McCain stated in a speech that "Our financial market approach should include encouraging increased capital and financial institutions by removing regulatory, accounting and tax impediments to raising capital.”
And when McCain's vice presidential nominee Sarah Palin was asked this week to cite a single effort on McCain's part to reform the banking industry, Sarah Palin "seemed stumped" and couldn't respond, according to one account.
What is also a point of fact is that John McCain's campaign manager, lobbyist Rick Davis, continued to take payments from Freddie Mac, one of the largest lenders in the country that failed in recent weeks. According to a recent New York Times story, Davis's lobbying firm took $500,000 through August of this year from Freddie Mac on top of the $2 million Rick Davis took in payment up through 2005 from both Fannie Mae (also failed in recent days) and Freddie Mac to head a group called the Homeownership Alliance.
Former officials at Freddie Mac told the New York Times that the Homeownership Alliance was created to combat regulatory efforts aimed at examining the activities of the two large lenders in the housing market. The Homeownership Alliance was dissolved in the wake of major lobbying scandals that involved some officials affiliated with the lenders. After its dissolution, Davis asked for and received additional payments from the Freddie Mac, according to the Times.
So far, little media scrutiny of this affair has tried to determine if the Freddie Mac payments to McCain's campaign manager purchased access to the McCain campaign or attempted to get McCain as a Senator or a potential president to protect its interests.
At the very least, the revelations contradict John McCain's pledge to not have paid lobbyists on his campaign.
