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A sign such as this one in Stockton, Calif., sums up what the federal government has wrought with its effort to extend homeownership to those who... View Enlarged Image
Big Government: One of the tragic ironies of the financial meltdown is that it was caused by well-meaning politicians who didn't know what they were doing — and ended up hurting the very people they intended to help.
Monday's Los Angeles Times carried a timely and melancholy piece on how the economic downturn that resulted from the housing crash three years ago has taken down entire regions in California — places that once hummed with businesses and people but have now become industrial wastelands.
The Times article points in particular to the region east of San Francisco, once a sprawling group of bedroom communities filled with people who moved inland in search of more affordable homes and commuted daily to the City by the Bay and Silicon Valley.
Those days are gone. Today, the Times notes, "jobless rates go up to 20%, (and) home prices are down as much as 75%." What's left is misery, empty buildings and broken dreams.
The East Bay's abandoned housing subdivisions and shuttered businesses now compete with those of Southern California's Inland Empire for the grim distinction of the biggest economic disaster zone in the once-Golden State.
The misery won't end soon, because the federal government is repeating the very same mistakes that created the housing nightmare in the first place — including pushing banks to make home loans to people who can't repay them, and expanding Fannie Mae's and Freddie Mac's role in housing markets even as their losses mount.
Have we learned nothing? This didn't happen overnight. The causes of our current meltdown go back to the early 1990s, when President Clinton first made it official U.S. policy to encourage lending to what were called "low- and moderate-income borrowers."
By 1994, Clinton's "National Homeownership Strategy" started a nationwide push to lower mortgage-lending standards to get more poor people into homes. But the question arose: How could you force banks to lend to people who couldn't pay them back?
The White House answered by using the 1977 Community Reinvestment Act — originally intended to ensure that banks lent in communities where they had branches — to force banks to make loans to minorities and the poor. To fund it all, the White House turned to Fannie Mae and Freddie Mac to build a massive, multitrillion-dollar market for U.S. subprime mortgages.
In November 2000, HUD Secretary Andrew Cuomo issued a press release trumpeting the government's reckless plans: "HUD Announces New Regulations to Provide $2.4 Trillion in Mortgages for Affordable Housing for 28.1 Million Families."
Immigration: The 14th Amendment was written to guarantee citizenship for freed slaves. It's been misinterpreted to give citizenship to children of illegal aliens. Now some GOP leaders want to restore its original meaning. In Texas this year, some 60,000 so-called "anchor babies" will be born ...
Lame-Duck Session: If the majority party loses one or both chambers this fall, what could beaten and embittered Democrats do to the nation before the next Congress is seated? They could actually make things worse. In the nearly two years since voters entrusted them with both the White House ...
Iran: China, Russia and other countries are neutralizing the already minimal effects of U.S. sanctions on Tehran. As a Middle East terror state builds nuclear weapons, our strategy is full of holes. 'Iran: Open for Business!" — that might as well be the slogan of the Iranian Chamber of ...
With the disappointingly soft jobs report for July and a faltering recovery overall, is Team Obama getting ready for some sort of new, liberal-left, Keynesian, big-bang stimulus package? Will it be desperate to "do something"? Already there are rumors of an August surprise (to use the phrase of ...
A graduating senior at Hunter College High School in New York gave a speech that brought a standing ovation from his teachers and got his picture in the New York Times. I hope it doesn't go to his head, because what he said was so illogical that it was an indictment of the mush that is being taught ...
Posted By: Rosebud(155) on 8/10/2010 | 3:17 AM ET
OBAMA SHOULD BE IMPEACHED FOR DERELICTION OF DUTY, MALFEASANCE & A WILLFUL IGNORANCE OF THE CONSTITUTION. IMPOSING CITIZENS BY FORCE UNDER PENALTY OF LAW TO BUY A PRODUCT IS UNCONSTITUTIONAL. IGNORING THE SAFETY & WELL-BEING OF THE CITIZENS OF THIS COUNTRY BY IGNORING & NOT PROTECTING IT'S BORDERS IS ALSO AN IMPEACHABLE OFFENSE. SHALL I GO DOWN THE LIST?????? WAKE UP HOUSE & START MOVING TOWARD GETTING IT IN ORDER!
Posted By: Rosebud(155) on 8/10/2010 | 3:10 AM ET
I AM SICK OF PAYING TAXES WHEN 50% PAY NOTHING. NOW I SHOULD PROVIDE THEM WITH A HOME FOR NOTHING & HEALTHCARE TOO, SO I CAN GET LESS ON MEDICARE!
Posted By: Rosebud(155) on 8/10/2010 | 3:09 AM ET
cont.Now they want to create the same situation all over again by continuing this same practice? Obama's plan for spreading the wealth is for taxpayers to pay for these mortgages that will be forgiven. This will make an estimated plan cost us $1 trillion. Obama's plan: taxpayers should provide healthcare & homes for all the deadbeats who sit around on the dole rather than educate them to get a job. Give a man a fish, he will eat for a day, teach him how to fish & he'll never go hungry.
Posted By: Rosebud(155) on 8/10/2010 | 3:02 AM ET
Ceo of Fannie Mae, Franklin Raines, buddy of Obama,kept two sets of books & took $90 mil bonus for himself. Why isn't Obama's FAT CAT friend in jail? During congressional hearings after Bush asked Congress to rein in F& F, Chris Dodd, Barney Frank & Maxine Waters all testified there were no problems with the banks. Bill Clinton started this mess & used HUD/Andrew Cuomo to issue "affirmative Action Mortgages" to the poor & place them in F&F after he forced the FED to lower credit standards.
Posted By: InCincy(1280) on 8/10/2010 | 1:34 AM ET
Divided and Conquered. this is not a Democrat vs Republican thing: it's insiders versus outsiders and I do not believe anyone reading this is an insider. We'll see if a new brand of leadership can make a difference but the bureaucrats will fight and scream as they attempt to maintain their power, perks and budgets.
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