Eight Years Ago…

Howard Husock saw the writing on the wall.

The Clinton administration has turned the Community Reinvestment Act, a once-obscure and lightly enforced banking regulation law, into one of the most powerful mandates shaping American cities—and, as Senate Banking Committee chairman Phil Gramm memorably put it, a vast extortion scheme against the nation’s banks…

The CRA’s premise sounds unassailable: helping the poor buy and keep homes will stabilize and rebuild city neighborhoods. As enforced today, though, the law portends just the opposite, threatening to undermine the efforts of the upwardly mobile poor by saddling them with neighbors more than usually likely to depress property values by not maintaining their homes adequately or by losing them to foreclosure.

Read the whole thing.

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2 Comments

Filed under Opinion, politics

2 responses to “Eight Years Ago…

  1. forest

    And then you had Fannie Mae (the government) enabling and encouraging this scenario to metastasize though all types neighborhoods, and now we have a disaster. I mean, why would for-profit banks make a bunch of “no money down” loans to questionable borrowers? Because the government seemingly eliminated the risk by buying the garbage through Fannie Mae.

    So what do we do now? Give more power to the big government stooges who were behind it to begin with. Barney Frank, Countrywide Chris Dodd and a race-hustling attorney who filed strong-arm lawsuits against banks and took more money from Fannie than anybody in the last few years – Barack Obama.

    This should work out well.

  2. forest

    Almost forgot to add – most of the Republicans aren’t much better.

    How about we give another trillion dollars of borrowed money, backed by taxpayers, to Fannie Mae, reckless banks, and reckless borrowers? We’ll bail out the UAW too!

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