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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: Les H who wrote (53406)	10/27/2000 8:13:27 PM
From: American Spirit	Read Replies (1) \| Respond to of 769670

S+L debacle history quotes: Thomas Vartanian General Counsel to Bank Board, 1983 "October 15 1982 was a historic day which shaped the future of the S+L industry, the day Reagan signed into law the Garn-St germaine Depositary Institutions Act of 1982". Reagan upon signing "This is a great day for America". Martin Mayer author "The crucial fact remains that the S+L industry had no antibodies to protect itself against the eruption of fraud and abuse created by the government during the first two years of the Reagan administration" Once most regulations were removed, real estate developers were able to purchase their own S+L's. And the developer crowd resally moved on them in Texas. "Garn-St Germaine increased greatly the amount of assets S+L's could have in commercial real estate and at the same time eliminated all control over how much could be lent to build and carry commercial properties. S+L's were also now allowed to lend 100% of assets to a single borrower. Under this new rule, a single real estate failure could bust a bank and failures are by no means unknown in the real estate business". Seminars began popping up in Texas and California "How To Get Rich Quick Using new Legislation", and did they ever. Top Reaganite examiner Ed Gray tried to warn his bosses many times of the worsening crisis. When he advised re-regulating the industry "Donald Regan was outaged and began plotting his removal". Why didn't someone take the problem to reagan? Because "reagan didn't like to hear of such things". Years later after Regan and Ed Meese headed a campaign (sometimes involving congress on both sides of the aisle) to keep the problem under wraps and bleeding banks in business until Reagan was re-elected, a cover-up which continued for the next four years until after Bush was elected, the debt had grown to astronomical proportions. Mayer writes "When you pretend that insolvent banks aren't insolvent you make the insurance fund insolvent too", which is what happened. In the end one ruined banker bemoaned "If this industry dies it will be because in the heady early Reagan days too many people in government and industry forgot you were never supposed to get rich in the S+L business. Or go bust either."