Obama adviser-don't blame govt for subprime mess

JACKSON HOLE, Wyo., Aug 22 (Reuters) - An adviser to U.S. presidential candidate Barack Obama said on Friday government policies aimed at home buyers -- such as the mortgage interest tax deduction -- should not be blamed for the credit crisis that has pushed the U.S. economy to the brink of recession.

University of Chicago economics professor Austan Goolsbee said at the Kansas City Federal Reserve Bank's annual monetary policy conference he would disagree that "the government's policies encouraging leverage have been somehow directly involved in this crisis."

Goolsbee spoke from the audience in response to a paper by by Columbia University economist Charles Calomiris, who argued the current financial crisis occurred in part a result of government policies that subsidize risk-taking in real estate.

Goolsbee said many of the programs Calomiris named, which also included the implicit government guarantees for mortgage enterprises Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, were in place for a long time before the current crisis.

Goolsbee said many subprime borrowers' incomes were sufficiently low that they would not be able to take advantage of the ability taxpayers have to subtract the interest paid on a mortgage from their tax liability.

Harvard economist Martin Feldstein, until recently head of the National Bureau of Economic Research, said the U.S. economy is heading for recession as a result of plummeting home values, falling employment and declining spending despite government rebates to taxpayers.

"That's where we are today, in the middle of a financial crisis, with the economy sliding into recession, with monetary policy at maximum easing, and fiscal transfers impotent," he said at the same conference. (reporting by Mark Felsenthal; Editing by Neil Stempleman)