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Burning down the house; How Democrats sparked the Great Recession (book recounts Fannie Mae debacle)
NY POST ^ | 7/3/11 | GEORGE WILL

Posted on 07/03/2011 6:09:37 AM PDT by Liz

“Reckless Endangerment” a scalding new book ....... is another cautionary tale about government’s terrifying self-confidence.........."a story of what happens when Washington decides, in its infinite wisdom, that every living, breathing citizen should own a home.” The 1977 Community Reinvestment Act pressured banks to relax lending standards......... In 1994, Bill Clinton proposed increasing homeownership through a “partnership” between government and the private sector, principally orchestrated by Fannie Mae. Fannie Mae’s political machine dispensed campaign contributions, gave jobs to friends and relatives of legislators, hired armies of lobbyists (even paying lobbyists not to lobby against it), paid academics who wrote papers validating the homeownership mania, and spread “charitable” contributions to housing advocates across the congressional map. By 2003, the government was involved in financing almost half — $3.4 trillion — of the home-loan market..........by summer 2005, almost 40% of new subprime loans were for amounts larger than the value of the properties. “Reckless Endangerment” is a study of contemporary Washington, where showing “compassion” with other people’s money pays off in the currency of political power, and currency.

(Excerpt) Read more at nypost.com ...


TOPICS: Crime/Corruption; Extended News; Government
KEYWORDS: debt; deficit; fannie; fanniemae; feddie; freddie; freddiemac; gretchenmorgenson; liz; mortgagecrisis; recklessendangerment
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To: redhead; Libloather; AT7Saluki
Does anyone know where I can find stats on the racial makeup of F/M borrowers? I tend to think it was weighted very heavily toward families of color, but would like some proof.....


61 posted on 07/03/2011 11:30:40 AM PDT by Liz ( A taxpayer voting for Obama is like a chicken voting for Col Sanders.)
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To: libstripper

And Reserve Primary breaks the buck and all comes crashing down!

Thanks all, I haven’t picked up the book yet but I’m learning a lot here this morning.


62 posted on 07/03/2011 12:33:38 PM PDT by Mr. Peabody
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To: Liz

But how many illegals got subprime loans?
It couldn’t have been that many?
Or could it?


63 posted on 07/03/2011 12:37:42 PM PDT by Mr. Peabody
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To: redhead

I don’t think the racial characteristics of the borrowers matters, other than they lied about their ability to pay.


64 posted on 07/03/2011 1:34:09 PM PDT by Eric in the Ozarks (Eh ?)
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To: Liz

W never called himself a conservative...


65 posted on 07/03/2011 1:36:49 PM PDT by Eric in the Ozarks (Eh ?)
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To: raybbr

I’m not wrong. Democrats are 100% responsible for the size and scope of sub prime collapse. Read Reckless Endangerment.


66 posted on 07/03/2011 1:54:07 PM PDT by y6162
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To: Liz
great thread; great collection of research....

The column, Gretchen Morgenson's book (although they both are too kind ["compassion"...Dems only manipulate and deceive their base for their own agenda of control]), and the thread should be required reading for generations to come.

Fannie/Freddie are centerpieces of the criminal enterprise called the Democrat Party---where Dem cronies and collaborators loot the organization, get cushy jobs, bonuses, and the like. Fannie Mae’s political machine dispensed campaign contributions, gave jobs to friends and relatives of legislators, hired armies of lobbyists (even paying lobbyists not to lobby against it), paid academics who wrote papers validating the home ownership mania, and spread “charitable” contributions to housing advocates across the congressional map.

"the criminal enterprise called the Democrat Party"

a factual statement...

67 posted on 07/03/2011 1:54:15 PM PDT by thouworm (.)
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To: thouworm
Dems only manipulate and deceive their base for their own agenda of control.........

As I’ve posted time and again-----whenever Dems and their crony orgs like PP and the ACLU------start bleeding about “being for their fellow man”……………..you can make book that they’re conniving to make a buck on it.

68 posted on 07/03/2011 2:57:11 PM PDT by Liz ( A taxpayer voting for Obama is like a chicken voting for Col Sanders.)
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To: y6162
I’m not wrong. Democrats are 100% responsible for the size and scope of sub prime collapse. Read Reckless Endangerment.

Which presidential candidate called for Fannie and Freddie to INCREASE purchasing of mortgages in 2004?

Which president appointed Mel Martinez and Alphonso Jackson to the head of HUD to force banks to give mortgages to minorities?

If you believe the republicans are innocent of the mess then you are burying your head in the sand.

Did you go look at the information on "Ol Dan Tucker's" page, or not?

69 posted on 07/03/2011 3:43:59 PM PDT by raybbr (People who still support Obama are either a Marxist or a moron.)
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To: Liz

Wayne Barrett described this whole scenario three years ago in the liberal Village Voice:

http://www.villagevoice.com/content/printVersion/541234?ref=patrick.net


70 posted on 07/03/2011 4:46:43 PM PDT by Brad from Tennessee (A politician can't give you anything he hasn't first stolen from you.)
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To: raybbr

Nonsense. Why don’t you stick ole’ dan up your ass.

I have no patience for right wingers who succumb to left wing moral equivalence guilt trips. There’s a name for right wingers like you...stupid shit. Grow a pair.

The debte is over. A consensus has formed Democrats are 100% responsible for the sub primer fiasco.


71 posted on 07/03/2011 5:16:59 PM PDT by y6162
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To: raybbr
Which presidential candidate called for Fannie and Freddie to INCREASE purchasing of mortgages in 2004?

And which president (and party) called for reform of Fannie Mae and Freddie Mac in both 2003 and 2005?

Clue: it was George W. Bush and the Republicans. You could look it up.

Yeah, they let Barney Frank, Chris Dodd and the Democrats get away with blocking the reform efforts with a Senate filibuster both times. But that doesn't make them perpetrators, only accessories.

72 posted on 07/03/2011 5:25:42 PM PDT by okie01 (THE MAINSTREAM MEDIA: Ignorance On Parade)
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To: org.whodat

He’s black.


73 posted on 07/03/2011 5:41:04 PM PDT by Jacquerie
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To: y6162
I have no patience for right wingers who succumb to left wing moral equivalence guilt trips. There’s a name for right wingers like you...stupid shit.

Awwww! Isn't that sweet. Just like a liberal democrat. Name calling and swearing means you have no rebuttal and have to revert to childishness.

Nonsense. Why don’t you stick ole’ dan up your ass.

Still refuse to see the truth.

Grow a pair.

I did - a long time ago when I realized the GOP under Bush was a failure. Bush and his policies gave us Obama.

Grow a pair.

Did you say that about Bush when the dems pushed him around for eight years?

74 posted on 07/03/2011 5:55:37 PM PDT by raybbr (People who still support Obama are either a Marxist or a moron.)
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To: okie01
Which presidential candidate called for Fannie and Freddie to INCREASE purchasing of mortgages in 2004?

But that doesn't make them perpetrators, only accessories.

Pretty fine line there. Bush pushed for years for Congressional ways to "increase home ownership" so the numbers for the GDP would look good.

75 posted on 07/03/2011 5:58:30 PM PDT by raybbr (People who still support Obama are either a Marxist or a moron.)
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To: raybbr

Republicans did not feed off the housing bubble. Democrats did.
BWAHAHAHAHAHAHAHAHAHAHA!

In Bush’s June 17, 2002 speech, he also called for the creation of the American Dream Down Payment Fund. “And so here are some of the ways to address the issue. First, the single greatest barrier to first time homeownership is a high downpayment. It is really hard for many, many, low income families to make the high downpayment. And so that’s why I propose and urge Congress to fully fund the American Dream Downpayment Fund. This will use money, taxpayers’ money to help a qualified, low income buyer make a downpayment. And that’s important.”

____________________________ These dollars look like a drop in a very large bucket. - The American Dream Downpayment Initiative (ADDI) was signed into law on December 16, 2003. The American Dream Downpayment Assistance Act authorizes up to $200 million annually for fiscal years 2004 - 2007.
ADDI Funding Status

In FY 2007, Congress appropriated $24,750,000 for ADDI. Previously, Congress appropriated $74,513,000 in FY2003 and $86,984 in FY2004, $49,600,000 in FY2005 and $24,750,000 in FY2006. ADDI provides downpayment, closing costs, and rehabilitation assistance to eligible individuals. The amount of ADDI assistance provided may not exceed $10,000 or six percent of the purchase price of the home, whichever is greater. The rehabilitation must be completed within one year of the home purchase. Rehabilitation may include, but is not limited to, the reduction of lead paint hazards and the remediation of other home health hazards. Eligible Customers http://www.hud.gov/offices/cpd/affordablehousing/programs/home/addi/


76 posted on 07/03/2011 5:59:47 PM PDT by anglian
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To: raybbr

From NY Times - September 11, 2003

The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac — which together have issued more than $1.5 trillion in outstanding debt — is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors, and critics have said Fannie Mae does not adequately hedge against rising interest rates.

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ‘‘The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.

So, instead, they weakened EVERYONE’s buying power. I guess that’s what makes it fair. I’m sure glad they’re looking out for all of us.


77 posted on 07/03/2011 6:08:37 PM PDT by Auntie Mame (Fear not tomorrow. God is already there.)
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To: raybbr

“Grow a pair.”

Run back to Huff Po and tell them how you enterrf the right wing lair and stuck your tongue out. They’ll all clap their flippers for you and say my hero.

Our business is concluded.


78 posted on 07/03/2011 6:09:57 PM PDT by y6162
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To: y6162
Our business is concluded.

Thank God. I've enough vileness from you.

79 posted on 07/03/2011 6:13:19 PM PDT by raybbr (People who still support Obama are either a Marxist or a moron.)
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To: y6162
I have no patience for right wingers who succumb to left wing moral equivalence guilt trips.

You missed the point. It's not that conservatives are equally guilty, the point is that Bush was not a conservative.

Or, at least that's how I understood it.

80 posted on 07/03/2011 6:26:45 PM PDT by slowhandluke (It's hard to be cynical enough in this age.)
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