Media Blog

Joe Nocera of the NYT Apologizes for Calling Us Terrorists

Sorry. Apology not accepted. Here’s an excerpt from Nocera’s moronic explanation:

Then came the financial crisis. I like to joke that there’s nothing like a good financial crisis to turn you into a liberal. But it’s not really a joke. The more I learned the back story that led to the crisis, the more horrified I became. The lack of regulation and oversight of Wall Street and the big subprime companies like Countrywide, driven by the ideology of deregulation, was thoughtless and irresponsible. The refusal of bank regulators to stop subprime abuses bordered on the criminally negligent. The unwillingness of the Obama Justice Department, even now, to hold anyone to account for their role in the crisis has been disheartening.

Countrywide, huh? Remember that, it’ll come in handy in a bit. Oh, and the Tea Party is a terrorist organization, but the Obama DOJ is just “disheartening?” Right. And Rahm Emanuel’s position on the board of Fannie Mae during all of this — that’s fine with Nocera? He continues. . .

Once the Republicans gained control of the House of Representatives, they began to systemically undermine the Dodd-Frank reform law, pushing back against new, and mostly sensible, regulations designed to prevent another meltdown. The worst was the way Republicans took a hatchet to Elizabeth Warren as she tried to set up the new Consumer Financial Protection Bureau. Such an agency, had it been in existence prior to 2008, might have prevented millions of Americans, many of them poor and financially unsophisticated, from being gouged by mortgage companies. Watching it all unfold made me angry.

Yes. Chris Dodd will save the day, despite his ties to Countrywide and despite his ties to the banking industry. Dodd was the Chairman of the Senate Banking Commission and had been in D.C. since 1974, yet this financial crisis just snuck up on poor Chris Dodd? This WSJ Editorial on 2008 captures the Dodd/Countrywide partnership perfectly:

Give Senator Christopher Dodd credit for nerve. On Tuesday, the very day he finally admitted knowing that Countrywide Financial regarded him as a “special” customer, the Connecticut Democrat also announced that he was bringing to the Senate floor a housing bailout sure to help lenders like Countrywide.

How much will Countrywide benefit from Mr. Dodd’s rescue? The Senator’s plan allows mortgage lenders to dump up to $300 billion of their worst loans on to taxpayers via a new Federal Housing Administration refinancing program, provided the lenders are willing to accept 87% of current market value. The program will be most attractive to lenders and investors holding subprime and slightly-less-risky Alt-A loans made during the height of the housing bubble in 2006 and 2007.

As the market leader during that period, Countrywide originated $167 billion of such loans, more than 11% of the nationwide total, according to Inside Mortgage Finance. Analyst Fred Cannon of Keefe, Bruyette and Woods estimates that the company is still holding more than $30 billion in subprime and Alt-A loans on its books, based on the company’s most recent quarterly financials.

Even for the loans Countrywide has already packaged and sold, the company would still benefit from the bailout. That’s because Countrywide continues to service the loans, and every loan that goes bad means increased costs for the servicer.

But that’s not what makes Nocera angry. It’s the Republicans, of course. . .

That anger reached its apex on Tuesday, when I wrote a column comparing the Tea Party Republicans to terrorists. The words I chose were intemperate and offensive to many, and I’ve been roundly criticized. I was a hypocrite, the critics said, for using such language when on other occasions I’ve called for a more civil politics. In the cool light of day, I agree with them. I apologize.

I won’t steal Jonah’s line, but it fits.

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