Democrats at root of housing crash.

 

The roots of the housing crash.

This is from my personal knowledge and experience at the time and a response to a letter I received from someone who blames the Republicans and greedy Capitalists for the crash.  Necessarily longer but gives you ammunition (pun intended) to shoot down the claims that Republicans caused the crash.

The root of the housing crisis began with FDR (a Democrat) in 1938 when he created Fannie Mae (Federal National Mortgage Association) in order to bail out the banks during the great depression. It enabled poor and middle income buyers to buy homes who otherwise would not have qualified for loans.　 In 1968 President Lyndon Johnson (a Democrat) was pressing the Vietnam war.  He needed wiggle room in the budget so he converted it to a publically traded company. Two years later Freddie Mac (Federal Home Loan Mortgage Corporation) was created to supposedly keep Fannie from being a monopoly. They allowed people who couldn’t afford a house to buy one and hold $5 trillion + in debt. 　

In 1977, Jimmy Carter (a Democrat) passed the Housing and Community Development Act to promote rebuilding housing in "the more devastated and needy communities of our country".　 Block grants and other incentives "designed primarily to stimulate private investment into renovation and building of adequate housing for our people". (From the signing speech by Carter). This began to addressed the red lining of the banks that would not loan in distressed areas, mostly inner city black neighborhoods.  (Interestingly, title VII eased the restrictions on building in flood plains.  I wonder if that had any effect on the people in New Orleans that have now been flooded out.)  In the meantime I was struggling to keep my people working, giving them raises every three months because the inflation rate was 12% and interest rates were around 20%.

In the second year of the Clinton administration, Clinton (a Democrat) had his treasury secretary Robert Rubin lean on the banks to loan more money to poor people and threatened them with federal action if they did not comply, much like Obama did with TARP and the stimulus package. The banks were basically forced to loan to people who they had little or no confidence in them being able to repay the loans.  Of course the mortgage officers and the mortgage brokers all got their commissions because they essentially had no risk---they could sell the mortgages to Fannie and Freddie, get paid right away and not worry.  Loans were made by pumping up the supposed income of people working part time, not requiring a down payment or putting buyers in homes they could not afford based on the assumption that the home would always go up in value.　This was made possible by gutting the Glass-Steagall Act of 1933 which prevented banks from dealing in securities thereby allowing them to go back into the bond markets.  This was done in 1999 under Clinton (a Democrat) with the help of a lot of Republicans, unfortunately.  The act was called the Gramm-Leach-Bliley Act.

Now I come to Bush 43.　 He warned about the coming crisis with Fannie and Freddie but not strongly enough. No balls at all!  Whenever the issue was brought up, congressmen like Barney Frank (a Democrat) and Chris Dodd (also a Democrat) would go ballistic and claim there was nothing wrong with them. "They were sound and well managed."　 We all know what eventually happened.  With such a monumental collection of bad loans packaged and sold by bankers as 　　AAA bonds. These same bankers are big supporters of Barack H. Obama.  So are all the leaders of the labor unions most of which are making millions off their workers, living like kings. promoting labor unrest, and ultimately causing the exportation of jobs to non-union countries like Mexico and China.  George Soros, one of the billionaires  is already in control of the White House along with many Communist/Marxist staffers and advisors.

President Kennedy, (a Democrat) President Reagan, (a Republican) and President Bush, (also a Republican) all understood that the more you tax something the less you get of it.　 When they cut taxes the overall revenue to the government increased greatly.　 When the Republicans took over the House and Senate in 1994 they cut spending, closed unneeded military bases that were being protected by congressmen, and most significantly reformed welfare creating a surplus and making Clinton look good. I recall well the 1993 tax increase Clinton passed with his Democrat congress. It was the first retroactive tax increase in history.... the Clinton tax package increased gas taxes and hiked the corporate income tax rate from 34 to 35 percent. It substantially raised the top personal/small employer rate—from 31 to 39.6 percent.
Read more: http://newsbusters.org/blogs/tom-blumer/2012/07/23/wapo-calls-clintons-1993-tax-increase-deficit-reduction-plan#ixzz25WylEpaY

I am certainly not a billionaire. Not even close. But because I take very good care of my fellow employees with excellent pay, working conditions, health care and 401K profit sharing, if you tax me you tax all of my employees. They have HSA’s (Health Saving Accounts) that allow them to spend their own money pre-tax and they love the plan. If they don’t spend it they are allowed to accumulate the unspent balance over the years and save it. They are absolutely against ObamaCare as they know they will loose the flexibility they now enjoy.

The original settlers of Jamestown had a commune. All for the common good. They starved every winter.  Only until they were allowed them to keep some of the fruits of their labors did the colony start to prosper. The profit motive, Free Enterprise and the creativity that comes from it is why these United States became the greatest, most prosperous country in the history of the world---period.　 Capitalism is the most efficient way to redistribute capital to the most profitable endeavor.  Any time the government gets involved you can count on graft and corruption, no matter what party is in office.　

In 1995, attorney Barack Obama filed a mortgage discrimination lawsuit against Citibank on behalf of 186 black Americans. The result of the lawsuit forced Citibank and other mortgage institutions to approve of subprime mortgage rates for low income blacks living in the Chicago area. Today, nearly half of those that received the subprime loans have either filed bankruptcy and/or been foreclosed on. Although there were non-blacks living in the same neighborhood at the time, none of them were included in his lawsuit. Read more: http://godfatherpolitics.com/6893/president-obama-all-men-are-not-created-equal/#ixzz25WrlMhGz

The blatant disregard of our laws, congress, our constitution, and the will of the American people has many people worried, angry and afraid.  Obama has dictated from his throne, spent our money recklessly and undermined our status in the world. He has promoted class warfare, a divisive anti American philosophy and employs Chicago thug politics at every turn.  He practices the plan of Saul Alinsky in "Rules for Radicals". He has, and probably still is, employing Communists (Van Jones for one). Some say that "2016-Obama’s America" is preaching to the choir. But if you will go see it I think you will be impressed and might open the door a little to the possibility that he is bad for the country.  Many of the clips are his own words in his own voice.　 Give it a shot, go to a matinee.

I spent all afternoon "laboring" on Labor Day to put this together.　 Hope you take it to heart.