I think that I may have to side with Bush on this one. It does not make sense to rescue the mortgage industry with legislation that will cost American taxpayers twice. To the extent that the new housing bill actually props up house prices, it'll cost Americans by driving up housing costs along with the price of fuel and food and education. And given that this bill will cost billions, taxpayers will be charged to prop up these prices. Bush was right to threaten to veto the House Housing Bill.
Legislation thus far has seemed to do more to help the financial industry (read, CEOs) then the average person. The finance industry is in trouble because Americans are finally responding rationally to stagnating incomes by cutting back on debt obligations. The finance industry first benefited from growing incomes (up to about 1960) and then from growing incomes coupled with growing debt (from about 1965 to 2000) and then, for most of the last decade, a growth in debt even as incomes stagnated. But the ratio of financial obligations to disposable income has finally come down. Households finally adjusted to lower incomes by accepting less debt. This reversal in the growth of debt means that the financial industry suddenly faces the prospect of stagnating growth.
Not only have median incomes fallen, but households have reduced their debt obligations, as can be seen in this graph of financial obligations (basically the ratio of debt payments to disposable income).
This is not really a housing crisis. Lower prices don't change mortgage payments for people who already own and do make it easier for new people to buy (even those who sell for less can, in turn, buy for less). This is a financial industry crisis. And the financial industry was the largest contributor to both Bush and Kerry's campaigns in 2004. (In the last decade, Freddie Mac and Fannie Mae spent $200 million lobbying government.) After paying so much, they expect returns.
It is worth clarifying who gets those returns. It is not stakeholders like consumers, employees, shareholders, or taxpayers. The returns flow to corporate executives who feel entitled to obscene salaries even while letting down ALL these stockholders.
Freddie Mac's CEO got nearly $20 million last year for his McLeadership. By contrast, Fannie Mae's CEO was penalized for reducing the value of his company by half: his pay was reduced in 2007 by 15% to a mere $12.2 million.
If legislators actually cared about housing, they’d address homelessness. Instead, this seems like another instance of crony capitalism masquerading as pro-business policy. No industry has benefited more from the "privatize profits and share losses with taxpayers" philosophy of crony-capitalism than the financial industry.