Is Bush to blame for the housing bubble?

I have always been amazed at how people can be blinded by their political affiliation. Far left-wingers often go out of their way to blame Republican politicians for anything they can. Far right-wingers often do the same to Democrats. Often they will have different opinions on similar circumstances based on which party is in power.

An example of this political affiliation blindness is the fact that many people on the far left insist on blaming George W. Bush for the housing bubble, while I'm unaware of any right-wingers willing to blame him. Instead, many conservative Republicans blame it on Clinton.

In this graph, vertical blue bars mark when a Democratic president took office. Vertical red bars mark when a Republican president took office. Pay attention to the red housing graph line. It marks inflation-adjusted housing prices. Looking at the data, I can't see how either president can be wholly responsible for the bubble. In fact, I think blaming politicians at all mostly misses the mark.


So, who do I blame for the housing bubble? Alan Greenspan, who was appointed by both Republican and Democratic presidents. I don't claim that Greenspan necessarily started the bubble, but he certainly failed to do anything to stop it. Also, it was the second major asset bubble to occur during his chairmanship of the Federal Reserve. The first was the late-1990s stock market bubble. Asset bubbles are rare beasts, so having two sequentially under the same Fed chairman is unlikely to be a coincidence.