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The entire meltdown began in the late 1960s, and became worse with each Democratic administration.

In 1968 as part of President Johnson's Great Society reform plan, the Fair Housing Act was passed to fight the practice of restrictive loan processing. It prohibited geographic restrictions when the criteria for redlining were based on race, religion, gender, familial status, disability, or ethnic origin.

In 1977 Sen. Proxmire (D-Wisconsin) introduced a “creeping socialism” community reinvestment Senate bill. Opponents argued the bill would allocate credit without regard for merits of loan applications, thereby threatening depository institutions.

Proponents countered that it was only to ensure that lenders did not ignore good borrowing prospects in their communities. The bill's sponsor stressed it would neither force high-risk lending nor substitute the views of regulators or those of banks.

Then later President Carter, pressed by grassroots organizations — though opposed by the banking industry— signed into law the Community Reinvestment Act (CRA). It guaranteed home loans to low-income families.

Also at this time ACORN was forming and beginning its efforts to organize and redistribute federal money while bypassing state and local governments.

Enter quasi-governmental competition from Fannie Mae, Freddie Mac; active government officials (that interfered with the normal market funtions) such as William J. Clinton, James Johnson (Fannie Mae), Janet Reno (Justice Department), Henry Cisneros (Clinton's HUD Secretary), Robert Rubin (Treasury Secretary), Jamie Gorelick (number two at Justice), Andrew Cuomo (HUD Secretary after Cisneros), Rep. Barnie Frank who blocked efforts at oversight, and a whole host of other secondary players such as Madeline Talbot (ACORN), who implemented a massive re-distribution program of unimaginable scope, while paying themselves astronomical salaries, commissions, and bonuses.

Traditionally conservative banking, lending, insurance, and investment houses began to shift their business models under pressure from the three branches of government---Reno's Justice Department suits against lending institutions; Franks and Kennedy's legislative action on regulations and lending practices; Clinton's executive pressure from HUD and Treasury; and cutthroat competition from Fannie Mae and Freddie Mac which were engaging in unfair lending practices---and forcing historically successful and conservatively operated institutions into government constructed high risk adventures in money and credit mis-management.

It is even more complicated than this description.