Liberty Maven

While watching Neil Cavuto rip apart Bill O’Reilly on The O’Reilly Factor, my blood pressure rose a few points when I heard Bill O’Reilly call for the government to “watch over” banks and businesses to make sure they’re not preying on unsuspecting innocent people. He ranted that “it was wrong for those banks to lend to people who can’t pay it back” and my my blood pressure shot through the roof. While in chat with a friend, I ranted:  (slightly edited to remove cursing)

(12:32:26 AM) LibertarianMikeM: I get so (bleep)ing pissed off when liberals (and apparently also neocons like Bill O’Reilly) say that “it was wrong for those banks to lend to people who can’t pay it back” when in fact it was Clinton Administration (thanks to the Community Redevelopment Act in the late 60’s) who FORCED the banks to give out loans to “underprivileged” buyers. So the banks did what they were told even though it was a bad idea, and then when things went wrong, they blame the banks.  WTF?
(12:32:45 AM) LibertarianMikeM: Here in Baltimore, the exact thing is happening.  Wells Fargo was coerced (by threat of being called racists) to make loans available to many people who didn’t have the means to pay back to the loans.  Then the housing bubble burst, and people started defaulting on their loans causing this huge mess, and now the city is suing Wells Fargo for being “greedy” and handing out these loans.
(12:32:58 AM) LibertarianMikeM: What a (bleeped) up situation!

While I’m sure there were some cases of overly-zealous loan officers taking advantage of the “good times” at the height of the bubble, it cannot be denied that many banks were coerced into handing out questionable loans against their will.  They were forced by legislators to go against their own policies in the name of “social progress”.  Then when all the foreclosures came, nobody seemed to remember it was the government’s intervention that cause the problem in the first place.  It’s oh so convenient to blame the “greedy” bankers.

Investor’s Business Daily discussed the same thing:

But it was the Clinton administration, obsessed with multiculturalism, that dictated where mortgage lenders could lend, and originally helped create the market for the high-risk subprime loans now infecting like a retrovirus the balance sheets of many of Wall Street’s most revered institutions.

Tough new regulations forced lenders into high-risk areas where they had no choice but to lower lending standards to make the loans that sound business practices had previously guarded against making. It was either that or face stiff government penalties.

The untold story in this whole national crisis is that President Clinton put on steroids the Community Redevelopment Act, a well-intended Carter-era law designed to encourage minority homeownership. And in so doing, he helped create the market for the risky subprime loans that he and Democrats now decry as not only greedy but “predatory.”

Yes, the market was fueled by greed and overleveraging in the secondary market for subprimes, vis-a-vis mortgaged-backed securities traded on Wall Street. But the seed was planted in the ’90s by Clinton and his social engineers. They were the political catalyst behind this slow-motion financial train wreck.

Nevertheless, the media constantly repeats the lies and the drooling masses suck it all up.  Then all these unconstitutional bailouts, and we’re way over our heads in debt.  There’s no doubt in my mind that the only possible end result of all of this is economic collapse.