Democrats Were Wrong on Fannie Mae and Freddie Mac

Obamaite way:Stifle all dissent

Omaha World Herald, Sunday, October 12, 2008

Interesting article but have you listened to some of our Nebraska radio talk shows. I was amazed by their lack of thought, or orginal ideas and their unwillingness to stay abreast to current events. The conservative media must think that conservative, libertarian and democratic voters are plain stupid. Fair and informed media should write opinions rather than those whos agenda it is to promote a political party or doctrine.

Lowering Standards

Finally, someone looked further into the past in regard to this housing market. Maggie of TX made the correct comments regarding how during the Clinton Administration, Fannie Mae earmarked $2 trillion to be used for "loans to minorities, families headed by women, new immigrants and other underserved consumers" over a period of a decade. In fact, they had even given themselves deadlines and quotas to meet that went into the next administrations time.

What I want to know is when did home ownership become a requirement for all citizens? What happened to living within our means, working up to buying a home, even if it means working two to three jobs? When we lower the requirements/standards that must be met to be able to afford home ownership we not only do a dis-service to the housing industry, but we give false hope to people who are not ready financially to take on that burden.

Growing up in the late 60's and early 70's, it was part of the American Dream to own a home, but everyone new you needed to work hard to obtain it, not just given to you. My parents drilled into my head over and over again about living within a budget and how you set money aside to obtain those things. For many years, I could only afford to live in rental apartments or duplexes, etc. I knew what I could afford and what I couldn't, I remember the simple economic lessons that my parents taught me and one of them was knowing the difference between wants and needs. When we lower the standards so that we make housing affordable for everyone, the only ones that truly get hurt are those people who were given false hope.

We all know what happens when we start lowering requirements and standards, because we see it in our educational system today. The same principle is applied to that scenario. We are only cheating the youth of today, when we start lowering the standards in our schools today. Why do we lower them? Could it be because there are groups out there today who are worried that too many children will be left out? So instead of telling our youth you need to work hard at school to get an education, we just lower the standards so that they barely have to attend to graduate.

This is the same concept that is being used in the housing market today. We make it too easy for people who know they can't afford a mortgage to get one and in fact when Fannie/Freddie lowered the amount required for a down payment, it gave people no real incentives to work hard and continue to pay, since they had nothing to lose if they couldn't afford it.

My biggest question to all is - When did we stop being responsible for our actions? Simple answer - if you can't afford something, don't buy it! You don't need mortgage brokers telling you that "You to can be a homeowner", do the math first!

ACORN, Community Redev Act, national lowering credit standards

The damage was done by 1998. Jimmy Carter and the Dem Congress passed CRA in 1977. By the late 1980's, ACORN had developed a working strategy: mafiosi/terrorist type tactics against local banks, combined with lobbying and influence peddling in DC. ACORN filed CRA complaints which kept banks from merging or expanding until they caved -loans and ACORN contributions. Their great help was the 1989 savings and loan bailout requirement for public records of mortgage applicants by race, gender and income, which ACORN and other manipulated and used in CRA complaints, thus blocking/interfering with the rash of banking mergers in the early 1990's until their terms were met. When local banks relied on Fannie/Freddie's "requirements" to keep those local banks from having to cave to ACORN's extortion tactics, ACORN went after Fannie and Freddie to revise their standards, with the able help of the Democrats, including Frank. Fannie Mae was eased into pilot projects to "help local banks lower credit standards. 1991, Democratic subcommittee used ACORN's testimony to pressure Fannie and Freddie to relax standards, under threat of more stringent legislation. ACORN redrafted many F/F loan guidelines. 1993-94, ACORN & Clinton admin worked together and imposed set asides on F/F. 1994 plans for $1 trillion in low/mod income loans, amounting to 1/2 Fannie's business by the end of the 90's. June, 1995: with ACORN guest of honor, Clinton announced admin's "comprehensive new strategy" making mortgages available to "historically excluded." At local and nat'l levels ACORN levered pressure from CRA and political pull with Democrats to force Fannie Mae and Freddie Mac into high-risk loans. Barney Frank spent years blocking regulation, including adding HUD [!] oversight to a status quo regulatory bill which Pres Bush firmly opposed in 2003. Frank and Moses were in a relationship from 1991-1998. Head of the oversight committee in bed, literally, with a top officer of the company he was responsible for overseeing. Remember Exxon and Anderson? Once the standards were debased, there was only one end to this mess. As individuals, we may feel sorry for excluded, but we don't loan them our retirement funds. Access, yes. But mortgage lending is no place for social restructuring. If you play, you must be able to pay.

Kate Smith from Minn.

Kate, you are obviously a Democrat operative. Anyone with half a brain knows the Dem's supported and allowed Fannie and Freddie to proliferate and spread the toxic sub-prime loans that are the root cause of the current world financial crisis. This is another example of government interference in free markets that turned out badly. If banks and other lenders had to hold their own loans (instead of selling them on the government-invented secondary mortgage market) they would have stricter underwriting requirements and the need for oversight and/or regulation would be negligible. The market would correct bad underwriting by forcing them (only them) to go belly up.

But good try pinning blame on everyone but the actual culprits Kate. Try studying economics at B school, not politics, before you pen your next misguided partisan piece!

Barney Frank

Our pensions are disappearing and Barney Frank is playing the race card. No one is accusing minorities Mr. Frank. They are accusing you and your liberal buddies. You should resign from Congress immediately. And what about Chris Dodd and his sweetheart loan from County Wide. He should go to jail.

P.S.

Since most of these loans were 3 year ARMs, doesn't that mean the GOP was in charge of the

executive, legislature, and the judiciary in 2005 and 2006. Or did everyone run out and buy a house after Jan 2007? In any event, the executive branch is charged with ENFORCEMENT of laws and that's still GOP. Aren't conservatives always complaining there are to many laws on the books.

Fannie and Freddie

Republicans for more regulation? Isn't that like Saddam wanting to ban weapons of mass destruction? If true, it was probably for the wrong reasons. Political retribution, no doubt.

Sen Pete used to say less taxes, less spending, get the government out of our lives. Yet, New Mexico is the third largest recipient of the federal dollar per capita, behind conservative states Alaska and Wyoming.

democrats were wrong on Fannie and Freddie

From the time I've identified mortgage fraud and a conspiracy to get away with it I have been trying to bring to the attention of OFHEO numerous documents proving the fraudulent misrepresentations and mortgage fraud, on the part of a mortgage bank, with the cooperation of Fannie officials.

Rather than even look at it or respond, they dismissed the whole thing because in this regulator's view, it was "just a dispute among investors and developer"...this is the pathetic excuse that passes for "oversight"...Now we are burdened with the obscene expense of carrying out a legal battle in federal court, which favors the perpetrators.

Barney Frank should be confronted, as should every one of those connected with the culture of corruption and politically tainted, biased oversight procedures that have resulted in nothing short of the most massive, scandalous theft of the National Treasurey, and the complete erosion of trust, confidence and respect for the American Way of doing business.

Note the Preamble to the Constitution, which all Americans are

supposed to agree with if they live within its sovereignty:

We the People of the United States, in Order to form a more perfect Union,

(1) establish Justice,

(2) insure domestic Tranquility,

(3) provide for the common defence,

(4) promote the general Welfare,

(5) and secure the Blessings of Liberty to ourselves

(6) AND our Posterity,

do ordain and establish this Constitution for the United States of America.

Question: Because of the acts of some 70 members of congress, subprime mortgages were given to 7 million households that couldn’t afford them, costing the other 97 million households $1.8 trillion dollars all together or about $17,000 each. If a congressman, no matter what his constituency, carries out acts that cover up or aid a process that is an ‘irreparable act of harm to the nation’, such as those that allowed Fannie May to sell much for nothing, has he violated any of the six covenants of the Preamble to the point that he has committed treason?

Don't forget McCain's tie to FANNIE MAE & FREDDIE MAC.

Interesting find. Right, according to Mr. Barone, McCain is the man right ? Both Democrat and Republican support FNM &FRE to some degree. Tony Snow was on Bill Maher bragging about home ownership when he was warned of potential saving & loan crisis again. And that Saving & Loan crisis happened because of Reagan's DEREGULATION policy. See the pattern of DEREGULATION from the Republicans ? Now, it's even worse since commercial banks owns investment bank. The second Glass-Steagall Act, passed on 16 June 1933, and officially named the Banking Act of 1933, introduced the separation of bank types according to their business (commercial and investment banking). BUT Gramm-Leach-Bliley Act of 1999 deregulate the banking industry.

http://www.nytimes.com/2008/09/10/us/politics/10fannie.html?_r=2&oref=slogin&pagewanted=print

Six members of the Republican lobbying firm Fierce Isakowitz & Blalock, all Fannie Mae lobbyists, have given Mr. McCain $13,250, records show.

The New York investor Geoffrey T. Boisi, a member of Freddie Mac’s board, contributed more than $70,000 to Mr. McCain and Republican Party committees working for his election. Both he and Richard F. Hohlt, a Fannie Mae lobbyist, are among the McCain “bundlers” who have raised $100,000 to $250,000 from others, according to the campaign Web site

http://mediamatters.org/items/200810070033

President Bush readily took up the homeownership baton at the start of his administration in 2001. Owning a home became one pillar of his "ownership society," a vision in which everyone would possess a stake in the American economy. For millions, this meant owning their own home. In summer 2002, Bush challenged lenders to add 5.5 million new minority homeowners by the end of the decade; in 2003 he signed the American Dream Downpayment Act, a program offering money to lower income households to help with down payments and closing costs on a first home. Lenders gladly accepted Bush's challenge.

To reinforce this effort, the Bush administration put substantial pressure on Fannie Mae and Freddie Mac to increase their funding of mortgage loans to lower-income groups.

http://www.washingtonpost.com/wp-dyn/content/article/2008/06/09/AR2008060902626_pf.html

In 2004, as regulators warned that subprime lenders were saddling borrowers with mortgages they could not afford, the U.S. Department of Housing and Urban Development helped fuel more of that risky lending.

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But by 2004, when HUD next revised the goals, Freddie and Fannie's purchases of subprime-backed securities had risen tenfold. Foreclosure rates also were rising.

That year, President Bush's HUD ratcheted up the main affordable-housing goal over the next four years, from 50 percent to 56 percent. John C. Weicher, then an assistant HUD secretary, said the institutions lagged behind even the private market and "must do more."