Jackson Free Press

In a campaign increasingly filled with ugliness, the worst thing I've seen happen is the false and racist campaign to blame the current financial crisis on poor people of color—through lies spread about the Community Redevelopment Act. We've been on this one for weeks now, starting with threads on the site, then this editorial, then Adam's story, A New Blame in Town. (We were glad to see that The Clarion-Ledger joined us yesterday in a good editorial, but I can't find the link on that awful site of theirs.) Now McClatchy has a news story out debunking the myths (quotes after the jump below).

This rumor is so disgusting because it is not directly just at Barack Obama or even Democrats. It is directed at an entire race and class of people, and it is pathetic. Regardless of your party preference, please, please debunk this rumor when you hear it.

WASHINGTON — As the economy worsens and Election Day approaches, a conservative campaign that blames the global financial crisis on a government push to make housing more affordable to lower-class Americans has taken off on talk radio and e-mail.

Commentators say that's what triggered the stock market meltdown and the freeze on credit. They've specifically targeted the mortgage finance giants Fannie Mae and Freddie Mac, which the federal government seized on Sept. 6, contending that lending to poor and minority Americans caused Fannie's and Freddie's financial problems.

Federal housing data reveal that the charges aren't true, and that the private sector, not the government or government-backed companies, was behind the soaring subprime lending at the core of the crisis.

Subprime lending offered high-cost loans to the weakest borrowers during the housing boom that lasted from 2001 to 2007. Subprime lending was at its height from 2004 to 2006.

(H/T - Folo)

Previous Comments

ID

138992

Comment

ACORN has done a great job registering voters. They have helped "change the game". Sure, when you have thousands of employees all over the country you will always have a few bad apples (I know this from dealing with just 370 plus employees annually.) This is why. This is why. This is why they’re hot: http://open.salon.com/content.php?cid=27676&source=newsletter

Author

FreeClif

Date

2008-10-13T13:52:51-06:00

ID

138994

Comment

Lookee here. McCain spoke at an ACORN rally in 2006. Headline speaker, no less.

Author

DonnaLadd

Date

2008-10-13T14:16:34-06:00

ID

139027

Comment

Root cause or not, fannie and freddie participated in the problem as evidenced by their massive financial problems right now.

Author

turbodog

Date

2008-10-14T06:46:50-06:00

ID

139040

Comment

Turbodog, you need to do some homework. No one is saying that Freddie and Fannie were perfect—but there is no basis for trying to blame CRA. The blame belongs squarely on the refusal to regulate as needed, just as we regulate check-cashing places to keep them from bilking consumers in financial trouble. A blind horse can see that—if he's willing. Read the McClatchy piece above again: Commentators say that's what triggered the stock market meltdown and the freeze on credit. They've specifically targeted the mortgage finance giants Fannie Mae and Freddie Mac, which the federal government seized on Sept. 6, contending that lending to poor and minority Americans caused Fannie's and Freddie's financial problems. Federal housing data reveal that the charges aren't true, and that the private sector, not the government or government-backed companies, was behind the soaring subprime lending at the core of the crisis. Subprime lending offered high-cost loans to the weakest borrowers during the housing boom that lasted from 2001 to 2007. Subprime lending was at its height from 2004 to 2006. The problem now is that the people who caused this by refusing to regulate are trying to blame the victims. The worse part of that is that if left up to the people who refuse to take the blame or regulate their corporate/financial friends, it will not be fixed and will continue to happen. We cannot afford that.

Author

DonnaLadd

Date

2008-10-14T10:14:40-06:00

ID

139041

Comment

We innocent, dog. As usual, other people set up programs that fail then we get blamed. Never the actual brainthrust or executors/performers of the bad plan. I say if we're to be blamed, give us total control and let us run the program. This way the blame can be fairly and accurately meted out.

Author

Walt

Date

2008-10-14T10:21:23-06:00

ID

142249

Comment

History has shown innumerable times that you can't regulate yourself out of holes and into greater productivity, opportunity, and prosperity. Go read 'economics in one lesson'. Did the 'program' fail when the mortgagee failed to pay their mortgage? And by extension: So it's wal-mart's fault when they stop me from leaving the store with mechandise I didn't pay for? And if you want to talk policy, the CRA did 'encourage' lending to people who weren't creditworthy. You think these banks were lending their OWN money? Ha! Nobody forced ANYONE to take out a loan they could not afford. All this crap is explained at closing, and usually several times before it. I am sorry people are going through rough times, but increased legislation is not the answer. It is the cause.

Author

turbodog

Date

2008-12-12T00:08:50-06:00

ID

142250

Comment

In re turbodog nonsense without any references to actual facts: Regulations such as limits on selling stocks short to, limiting commercial banks from taking on the risks of investment banks, regulations that ban abuses by those with insider information (I can go on and on)…These types of regulations are not promoted as mechanisms to get us out of wholes, but to keep us out of wholes --- to keep us from being swindled, to keep markets from being unduly influenced by speculators ans thieves such as the guy who was recently turned in by his sons for bilking folk out of $50 billion. Productivity and investment is assets are discouraged by uncertainty and when there is insufficient regulation to curtail speculation and abuse, uncertainty abounds, confidence plummets which leads to freezes in investment in things such as stocks and bonds which are the life blood of capitalism. I majored in economics at Northwestern University. What did you study. What source do you site for anyone who has promoted regulation in the way you describe it? Credible people including even Alan Greenspan admit that the deregulation that occurred over the past ten years opened the flood gates for what we are seeing today. The CRA law was passed thirty-five years ago. Only idiots would believe a thirty-five year old law is the proximate cause of the financial collapse we are seeing today.

Author

FreeClif

Date

2008-12-12T09:06:27-06:00