Associate Dean Timothy Canova authored an op-ed appearing in the Orange County Register entitled, “Reader Rebuttal: free markets.” In his piece, Dean Canova discusses the background leading up to the subprime lending crisis.  He writes that, “…the financial deregulation of the Reagan era foreshadowed many more recent developments, including the hiding of worthless assets through phony accounting, the lifting of capital requirements and overleveraging of financial institutions and the bailout of those same institutions.”  Dean Canova also discussed that Republicans tried to change the blame to Community Reinvestment Act (CRA), Fannie Mae and Freddie Mac.  He refutes the blame by saying, “CRA was always a small portion of the subprime market, and Fannie and Freddie were privatized and deregulated years ago, permitted to expand too quickly and to engage in risky lending practices.”  He concludes by quoting Alan Greenspan, former Federal Reserve chairman, who conceded that “he had made ‘a mistake’ in presuming the banks would provide effective self-regulation and manage their own risk. He conceded that he was “shocked” to discover that his world view, his ideology of deregulation, was flawed. Read article…