Twice on February 20, MSNBC promoted Rick Santelli's rant the previous day over President Obama's proposed foreclosure reduction plan, which Santelli said "promot[es] bad behavior" and "subsidiz[es] the losers' mortgages." In neither case did MSNBC provide any substantive response to those criticisms.
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Without providing any substantive response, on February 20, MSNBC twice promoted CNBC on-air editor Rick Santelli's February 19 rant over what Santelli said was the government's "promoting bad behavior" and "subsidiz[ing] the losers' mortgages" through President Obama's proposed foreclosure reduction plan.
When CNBC anchor Trish Regan reported on Santelli's comments during the February 19 broadcast of NBC's Nightly News, she included Moody's Economy.com co-founder Mark Zandi's response that the administration's plan "is a bitter pill to swallow, but it's one we need to swallow, so that the financial system, the economy, don't slide away" and that "you have a choice, either you can help your neighbor and help them so they can stay in their home, or don't help them, and they'll lose their home, and it'll cost you money because you'll be worth less because your home will have just dropped in value." However, when Santelli was interviewed about his comments on the February 20 edition of MSNBC's Morning Joe, no one provided or aired any substantative reply to Santelli, either from Zandi or anyone else. Later that morning on MSNBC Live, anchor Tamron Hall replayed and discussed Santelli's comments; again, no substantive response was provided.
In addition, Scarborough and co-host Mike Barnicle falsely suggested during their interview of Santelli that Rep. Barney Frank (D-MA) has only recently advocated a government focus on rental housing. Scarborough said, "[W]e had Barney Frank on a couple of weeks ago, who had been a big proponent, along with a lot of Republicans, of homeownership. When he was on our show, he said, you know, some people should just rent their properties." Barnicle later replied, "[W]hen the history of this period -- this financial period -- is written, there is a language of catastrophe that was introduced into the equation -- I don't know -- 10 or 12 years ago, in the sense that with the best of intentions, we had numerous politicians, mostly on the Democratic side of the aisle, saying everybody ought to be able to own a home in America." In fact, as Media Matters for America has noted, Frank has long advocated that the government focus on expanding affordable rental housing.
From the February 20 edition of MSNBC's Morning Joe:
SCARBOROUGH: Let's bring in right now CNBC's Rick Santelli. Rick, I had asked at -- during the 6 o'clock hour whether you had been just as critical of the Wall Street bailout. We were informed by millions of your fans -- and I always say a million Rick Santelli fans can't be wrong -- that, in fact, you did. Why were you so angry yesterday? What do you think the root cause of this problem is?
SANTELLI: Well, I think the root cause is that there has been overleverage -- you know, many people in media like to blame the market. The market is just a representation, a mechanism to deliver people's messages and trades. I think what we need to do here is be cognizant that the world looks to us for things like consistency of contract law. Why does the U.S. always snap back? Rural investors seem comfortable. Let's not give that away to judges in bankruptcy court.
If you want to help the 8 to 10 percent that are behind on their mortgages or going into foreclosure, it's hard to pick those that are deserving and those that game the system. It's also not necessarily fair to the 92 percent who are making sacrifices even though they're paying their bills, their 401(k)s or 201(k)s. What they need to do is come up with something where all Americans feel that they're part of this help and not feel as though they're taking from one group and giving to another.
ANDREW SORKIN (New York Times reporter): Rick, but here's the question. The question is, if you don't bail out the guys who are in trouble, how are you going to -- how are you going to -- I mean, if you don't bail out the guys who don't need the money, rather, how are you going to help the guys who do need it badly?
SANTELLI: Well, I'm not so sure that the people that say they need it badly are going to pass the litmus test of those 92 percent. Listen, Americans are charitable. It's just that it seems as though the government right now is kind of legislating away their charity. We need to be more inclusive in this, and as far as -- we need to do something. A lot of these government programs haven't really worked well. Some of them have worked fine. At the end of the day, I don't know that throwing trillions of dollars at a problem nobody is sure how to solve, or even how we got here, is the way to go because in a couple of years, this is going to correct.
SORKIN: And you do nothing, then? Or what do you do? What's the answer, then, if -- do nothing?
SANTELLI: I personally -- I personally would say, give more job assistance, give people more unemployment benefits, help them find places to rent. But yes, I think spending trillions of dollars on policies that we're not sure are going to work is too expensive.
SCARBOROUGH: You know, Mike Barnicle -- we had Barney Frank on a couple of weeks ago, who had been a big proponent, along with a lot of Republicans, of homeownership. When he was on our show, he said, you know, some people should just rent their properties. I want to give you these numbers that Pat's given us over the past couple days. Fascinating that, over the past 30 years, 64 percent of Americans have owned homes. Over the past four or five years, that number shot up to 72 percent.
Now I'm listening to Rick telling us about the 92 percent of people that owned those mortgages being able to pay them off, but now they're paying -- it sounds like they're paying for all these people that were artificially allowed into homeownership through government intervention. It's like they're bailing them out. Aren't we just extending the problem?
BARNICLE: Joe, when the history -- when the history of this period -- this financial period -- is written, there is a language of catastrophe that was introduced into the equation -- I don't know -- 10 or 12 years ago, in the sense that with the best of intentions, we had numerous politicians, mostly on the Democratic side of the aisle, saying everybody ought to be able to own a home in America. Well, guess what?
That's never been the case. It's never going to be the case. There are many people in this country -- no shame involved in this -- who should rent. They should rent. I mean, I grew up in a rented apartment.
BARNICLE: I mean, there's nothing wrong with renting. There's nothing wrong with working with your hands in this country.
BARNICLE: Not everybody goes to an Ivy League school. Not everybody can afford to own a home. And we got away from that in the mid-1990s, and here we are today with people losing their homes who shouldn't have been able -- shouldn't have managed the threshold level to buy the home in the first place: the language of catastrophe.
SCARBOROUGH: Rick, respond.
SANTELLI: I couldn't have said it better myself. Listen, this isn't about looking at your neighbor and saying, "Listen, I don't want to help him." A) It's maybe I don't want to be forced to help him. I don't know if his circumstances really warrant our help. I think -- give America a tax holiday. There's a number of solutions that are more inclusive. At the end of the day, when we get past these programs a couple years down the road, the 90 or 92 percent are going to be key to the future of making America greater than it's ever been. We need to be equitable and fair and be American. We need to make the notion that working hard and getting something and accumulating wealth is not a crime.
SCARBOROUGH: Yeah, and we also need to make sure that our government doesn't continue to pervert the market as they have over the past decade.
SANTELLI: Yes. I agree. I agree. But you know, it's not about left and right --
SCARBOROUGH: Putting people in homes that --
SANTELLI: -- and looking back.
SCARBOROUGH: No, it's not.
SANTELLI: There's been guilt on both sides. There really has.
SCARBOROUGH: The Republicans talked -- you know, everybody knows --
SCARBOROUGH: -- that Republicans and Democrats alike both promoted the ownership society. "Let's get them in their houses and then, you know, America's prosperity will grow."
SANTELLI: That's right.
SCARBOROUGH: Again, and we did things that were unnatural, that did violence to the free market, and we're paying for it.
SANTELLI: In the early '80s --
SCARBOROUGH" We just don't want to continue --
SANTELLI: -- I put 20 percent down -- in the early '80s, I put 20 percent down. I had a 15 percent mortgage. We had double-digit inflation, and we had double-digit unemployment, and nobody was bailing anybody out, and the country got through it under Ronald Reagan.
SCARBOROUGH: All right, Rick, thank you so much.
From the February 20 edition of MSNBC Live:
HALL: Talk about an interesting moment on television. Rick's rant -- CNBC's Rick Santelli is fueling a big debate on the government's $275 billion plan to stop the flood of foreclosures. Here's the big moment.
[begin video clip]
SANTELLI: This is America. How many of you people want to pay for your neighbor's mortgage that has an extra bathroom and can't pay their bills? Raise their hand.
TRADER: How about we all --
SANTELLI: President Obama, are you listening?
TRADER: How about we all stop paying our mortgage? It's a moral hazard.
[end video clip]
HALL: It's a moral hazard. CNBC's Rick Santelli, there with us live now. Rick, 140,000 hits on YouTube, countless other websites talking about you. Did you have any idea that what you did in that moment would spark this kind of debate?
SANTELLI: I absolutely did not, and anybody who watches CNBC knows I'm impassioned almost every morning I am on. I am shocked. But I'll tell you what: whether you agree with me or disagree with me, I'm pretty proud that it's opened up the discussion. Listen, if we're going to saddle our kids and grandkids with lots of zeroes of deficit, let's talk about it. Let's debate it. Let every voice be heard.
HALL: Right. What did they say to you today? What did the traders say? What kind of reaction? Were you getting high fives or thumbs down when you walked in?
SANTELLI: I will tell you that in terms of my email, or the clerks, support staffs or traders here, or the people I bump into, all around the city, it's been running on my side about 98 percent-plus.
HALL: Really? It's interesting -- on my Twitter page, a lot of people were saying to ask you, where you this outraged when Wall Street got the bailout --
HALL: -- when the banks got the help?
SANTELLI: Yes. Yes, yes, and yes.
HALL: Why didn't that make YouTube? Why didn't that make YouTube, then?
SANTELLI: I can't tell you that, but I will tell you this: This credit crisis, for all practical purposes, started out in the summer of '07, and I haven't changed. I said you can't fix toxic derivatives. Every Halloween since then I've said you can't resuscitate Frankenstein derivatives that we've overleveraged. Sometimes you can help, but there is no immediate gratification cure. There's going to be pain.
HALL: Yes or no, will the auto industry be bailed out? Yes or no?
SANTELLI: I think they should go into bankruptcy. No. But I think that we ought to help them try to survive. But I would say no.
HALL: OK. Well, you can weigh in on Rick's rant. Check out CNBC.com where you can vote if you want to Rick's Chicago tea party. We're going to talk much more with him a little later and also find out what some of the traders are saying about him on the floor.