Bush: Borrower-Friendly Policies, Lack of Regulation Combined to Create Crisis

While liberals and conservatives debate whether the current financial crisis was brought on by a lack of regulation or by borrower-friendly mortgage policies like the Community Reinvestment Act, President Bush today said that both are to blame.

"It's hard to explain to people how this happened," Bush said at a news conference in Virginia. "The truth of the matter is that the government, in good conscience, tried to convince people to buy homes but Fannie Mae and Freddie Mac, the instruments in Washington, were basically unregulated."

Bush sought to explain the $700 billion rescue plan passed by Congress, and signed into law last week, in the face of public skepticism over the package.