This week on Q&A, Pulitzer Prize winning author and journalist, Gretchen Morgenson, discusses her latest book “Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Created the Worst Financial Crisis of Our Time.” Financial analyst Joshua Rosner is the book’s co-author. This historical narrative details the 2008 financial meltdown triggered by the sub-prime loan lending collapse. Morgenson suggests that many watchdog agencies charged with oversight and protection of consumer interests were actually complicit in the actions that created the crisis. She says that Americans need to have a frank discussion regarding what role the government should play in housing finance. She makes the case that delivering the bulk of the country’s mortgages through Freddie Mac and Fannie Mae allows executives to extract profits for themselves at government expense. She talks about former Fannie Mae President James Johnson, and his role in increasing lending business while becoming a major proponent of decreased government oversight. She explains the role that Countrywide Financial had as the largest contributor of loans to Fannie Mae, and she discusses the testimony of Countrywide founder Angelo Mozilo before Congress in early 2008. She makes the point that many companies took needless risks on problematic loans as oversight became weaker. She argues that executives were able to walk away with enormous profits and taxpayers were left with the bill. In addition, she discusses her early career as a stock broker, what prompted her move into journalism, and her decision to serve as press secretary for Steve Forbes in 1995.
Gretchen Morgenson is assistant business and financial editor at the New York Times. She writes a weekly column in the Sunday business section titled “Fair Game.” Previously, she was assistant managing editor at Forbes magazine and executive editor at Worth magazine. She received her Bachelor of Arts degree in English and history from Saint Olaf College in 1976. This is her third book. She lives in New York City with her husband and son.