I must thank my dear friend Shtuey for seeing the bigger picture for all of us. And I must say thank you for helping me recover some of my memories of Denver. Shtuey you are my hero!
From Shtuey, our guest for the day:
How did we get here? How is it that “subprime mortgages” have brought us to the brink of economic collapse? Most people believe it is due to the predatory lending practices of financial institutions. That is the lie you have been sold. The truth is far more insidious. We are in fact on the brink of economic disaster because of the people who have sent Barack Obama.
In order to understand how this happened we must begin with Saul Alinsky , the radical socialist who, after spending a great deal of time with the Al Capone crime family in Chicago, realized that the same shakedown tactics used by the mob to extort business, and control politicians, could be used by activists to shakedown banks and political institutions to advance a socialist agenda. These were tactics utilized by groups like ACORN, in an effort to lobby the government to pass laws that forced lending institutions to issue mortgages to low income/”at risk” borrowers who often had no way of paying the money back.
But ACORN members probably did not lobby for these laws to bring down our economy, at least not knowingly. I believe that, apart from the leaders at the top, rank and file ACORN members legitimately believed they were fighting for low-income housing. But ACORN’s backers were simply using Alinsky’s method (never reveal your real agenda) to serve their own purposes. Who are these people? You know the names of two of them: Bill Ayers and Barack Obama. I suspect that they are more front men than anything else, though who knows who Ayers was with while he was in hiding?
Where did ACORN get the funds to engage in the widespread lobbying (read extortion) that allowed them to shakedown lenders and politicians? From the money diverted to them by Bill Ayers and Barack Obama, via the Chicago Annenberg Challenge, and the Woods Fund, as well as with your tax dollars allocated by Congressional Democrats; the same Congressional Democrats that have received hundreds of thousands of dollars from Freddie and Fannie in the form of campaign contributions; the same Congressional Democrats that ignored Republican calls for the regulating and reform of Freddie and Fannie–the institutions that took subprime mortgages, bundled them, and infected financial institutions worldwide…all in the name of granting minorities and low income families access to housing (always the trouble begins with the most honorable of intentions, or at least it is made to seem so), but with the Leftists’ hidden purpose of initiating a worldwide economic collapse. All of it accomplished with ACORN as the muscle.
“compels banks to make loans to low-income borrowers and in what the supporters of the Act call “communities of color” that they might not otherwise make based on purely economic criteria.”
DiLorenzo goes on to explain:
The original lobbyists for the CRA were the hardcore leftists who supported the Carter administration and were often rewarded for their support with government grants and programs like the CRA that they benefited from. These included various “neighborhood organizations,” as they like to call themselves, such as “ACORN” (Association of Community Organizations for Reform Now). These organizations claim that over $1 trillion in CRA loans have been made, although no one seems to know the magnitude with much certainty. A U.S. Senate Banking Committee staffer told me about ten years ago that at least $100 billion in such loans had been made in the first twenty years of the Act.
So-called “community groups” like ACORN benefit themselves from the CRA through a process that sounds like legalized extortion. The CRA is enforced by four federal government bureaucracies: the Fed, the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. The law is set up so that any bank merger, branch expansion, or new branch creation can be postponed or prohibited by any of these four bureaucracies if a CRA “protest” is issued by a “community group.” This can cost banks great sums of money, and the “community groups” understand this perfectly well. It is their leverage. They use this leverage to get the banks to give them millions of dollars as well as promising to make a certain amount of bad loans in their communities.
A man named Bruce Marks became quite notorious during the last decade for pressuring banks to earmark literally billions of dollars to his organization, the “Neighborhood Assistance Corporation of America.” He once boasted to the New York Times that he had “won” loan commitments totaling $3.8 billion from Bank of America, First Union Corporation, and the Fleet Financial Group. And that is just one “community group” operating in one city – Boston.
Banks have been placed in a Catch 22 situation by the CRA: If they comply, they know they will have to suffer from more loan defaults. If they don’t comply, they face financial penalties and, worse yet, their business plans for mergers, branch expansions, etc. can be blocked by CRA protesters, which can cost a large corporation like Bank of America billions of dollars. Like most businesses, they have largely buckled under and have surrendered to their bureaucratic masters.
Consequently, banks in every community in America have been forced to hold a portfolio of bad loans, euphemistically referred to as “subprime” loans. In order to compensate themselves for the added risk of extending these loans, many lenders have increased the lending fees associated with mortgage loans. This is simply an indirect way of doing what banks always do – and what they must do to remain solvent: charging effectively higher rates of interest on riskier loans.
But this is discriminatory!, complained the “community organizations.” Thus, if one browses the ACORN web site, one can read of their boasts of having “predatory lending laws” passed in numerous states which outlaw such fees, prohibiting banks from protecting themselves from the added risk involved in making forced loans to “subprime” borrowers.
Filed under: Barack Obama, General Politics, Hillary Clinton, John McCain, Mortgage Bailout | Tagged: acorn, ACORN Housing Corporation, Community Organizers, Community Reinvestment Act of 1977, George Soros, McCain, New World Order, Obama | 3 Comments »