Bush: My conscience is clear on financial crisis

http://www.marketwatch.com/story/bush-my-conscience-is-clear-on-financial-crisis-2010-11-10

It’s hard to explain to Americans why we used their money to prop banks: Bush

WASHINGTON (MarketWatch) — Former President George W. Bush on Wednesday defended his record of oversight of banks and argued that his conscience is clear when it came to the massive financial crisis that shook the economy to the brink in the final days of his presidency.

“I don’t think this was a matter of overregulation or lack of regulation. It was a matter of poor judgment by Wall Street and others. And -- but no question the housing bubble was fueled by government policy, and that is the result of people and Congress refusing to regulate Fannie and Freddie,” Bush said in an interview on NBC TV. “So my conscience is clear when it came time to recognize an impending problem.”

Bush, who was president from 2001 to 2008, argued that he recognized the looming problem of Fannie Mae and Freddie Mac, but his efforts to regulate the two housing refinance giants were ‘thwarted by powerful forces’ on Capitol Hill.

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During Bush’s presidency, the notional over-the-counter derivatives market ballooned from roughly $88 trillion in 1999 to $592 trillion at the end of 2008, and has been widely charged with helping to drive the meltdown. The opacity of this market led to a $180 billion bailout of American International Group Inc. /quotes/comstock/13*!aig/quotes/nls/aig (AIG 42.88, +0.02, +0.05%) , an insurance giant that was also a major derivatives vendor.

Bush declined to respond to a question about how much blame he deserves for the financial crisis, except to say that “any time you’re in power and there’s a problem, you’re going to get blamed.”

He argued that it was difficult to explain to “hard-working” American people why the government was using taxpayer dollars to stabilize the markets