Right-wing economic pundits Larry Kudlow and Stephen Moore claimed that Bill and Hillary Clinton are partly to blame for the housing crisis that rocked the economy during the Bush administration because of their support of the Community Reinvestment Act (CRA), a program intended to expand American home ownership. Kudlow and Moore, who both have served as economic policy advisers to presumptive Republican presidential nominee Donald Trump, pushed this repeatedly debunked myth while attempting to deflect attention from Trump's 2006 statement relishing the potential profits he could reap during a housing and financial crisis.
Kudlow and Moore falsely claimed Hillary Clinton was partly responsible for the housing crash in a May 29 op-ed in The Washington Times, adding that she has no right to lambast Trump for stating in 2006 that he had hoped the housing market crashes so he could buy properties cheaply. Trump has faced continued scrutiny over this statement. New York magazine even called it “a new, lurid reason why he should never be president” and media interest only grew after Sen. Elizabeth Warren (D-MA) called the GOP front-runner “a small insecure money grubber who doesn’t care who gets hurt so long as he makes money off it.” From Kudlow and Moore’s Washington Times piece:
It turns out that Donald Trump has been very good at buying low and selling high, and it helps account for his amazing business success.
Now Hillary Clinton seems to think it’s a crime. Campaigning in California last week she’s wailed that Mr. Trump “actually said he was hoping for the crash that caused hard working families in California and across America to lose their homes, all because he thought he could take advantage of it to make some money for himself.” She’s assailing Mr. Trump for being a good businessman — something she would know almost nothing about because she’s never actually run a business, though she did miraculously turn $1,000 into $1 million in the cattle futures market many years ago.
What is so hypocritical about the Clinton attacks is that it wasn’t Trump, but Hillary, her husband, and many of her biggest supporters who were the real culprits here.
Kudlow and Moore’s anti-Clinton attack is based on their claim that expanding access to mortgages to help low-income Americans buy homes was part of the catalyst for the housing crisis. The two also claimed that then-Sen. Hillary Clinton “went to bat for the housing industry” -- ignoring that Clinton actually pushed for tougher regulations on the financial industry in 2007.
Top economists reject the idea that President Clinton and his policies are to blame for the financial crisis -- including the current and former Federal Reserve chairs from Republican and Democratic administrations. Former Fed chairman Ben Bernanke disputed this myth in a November 2008 statement demonstrating that after studying the CRA for over 30 years the Federal Reserve's findings “runs counter to the charge that CRA was at the root of ... current mortgage difficulties." Current Federal Reserve chairwoman Janet Yellen found that the CRA did not cause problems but instead the CRA increased “responsible lending” in a March 2008 speech when she was the president and CEO of the Federal Reserve Bank of San Francisco.
Kudlow and Moore have a long and well-documented history of distorting facts on the economy. Nobel Prize-winning economist and New York Times columnist Paul Krugman, who has spent years documenting Moore's repeated failures in economic policy, recently slammed the right-wing commentator’s “impressive lack of even minimal technical competence.” Kudlow has made many statements berating Americans and even lectured single parents about poverty at an appearance at the Conservative Political Action Conference (CPAC) -- even though he admitted to having "virtually no knowledge in this field."