McKenna calls economic crisis ‘confluence of events’
The crisis in the financial markets is a “bipartisan mess” involving both of Barack Obama’s immediate predecessors, Congresses over the past 10 years and people who thought housing prices would always go up, Washington’s attorney general said Thursday.
Rob McKenna told the Washington Realtors Conference that different people spotted parts of the problems in recent years. He and the Iowa attorney general tried in 2006 to get tighter regulations and prevent fraud in the subprime loans process, and several states made attempts at consumer protection.
But the economic crisis was the result of “a confluence of events,” he said, including an economic boom fueled by debt, lenders losing their connection with borrowers and home buyers being enticed by unaffordable mortgages.
“I didn’t see the whole picture. None of us did,” McKenna said. “No one predicted foreclosure begets foreclosure.”
McKenna, who is the state’s highest-ranking Republican and often mentioned as the likely GOP candidate for governor in 2012, had harsh words in his speech for congressional Democrats who took campaign contributions from financial institutions and supported the lifting of some financial regulations that had been in place since the Depression. But he agreed with a questioner that Republicans in Congress and the White House shared the blame.
“Look, this was a bipartisan mess,” he said. Regulations got weaker in the Clinton administration, and the Bush administration “helped make things worse,” he said.
Bush touted numbers of increasing home ownership without regard to whether those new buyers could afford what they’d purchased. Both parties received large campaign contributions.
But McKenna gave Obama good marks so far, for “taking a number of correct steps to create a market.”
In addressing the state’s Realtors, who were holding their general meeting at the Northern Quest Casino, McKenna was speaking to a group that has backed him since he first ran for King County Council, and supported both of his runs for attorney general.
McKenna insisted he hasn’t decided whether he’d be calling on them in three years for another run for the job he’s got, or a run for governor.
“I don’t know what I’m going to do in 2012,” he said. “I could be very happy serving another term as attorney general. I’m not really interested in being a candidate for three or four years.”
He does have a slightly lower win ratio on bills he proposed to this year’s legislative session compared to previous years, but he doesn’t think that’s a result of a Democrat-controlled Legislature turning down proposals of a potential Republican governor.
“There’s talk like that every session. But it’s never substantiated,” he said.