The Hits Just Keep On Coming

This would be just unbelievable but for the fact that it makes sense in a certain world of warped logic. Our Great Leader and his band of Merry Dumbkoffs are going for the hair of the dog, mmm, mmm, mmm! Unbelievable? You be the judge:

A Poisonous Cocktail
Expanding the Community Reinvestment Act.

. . .

In short, the CRA is compelling banks to make trillions in loans to individuals who have poor credit and who often can’t or won’t make their payments.

Now comes Rep. Eddie Bernice Johnson, D-Texas, and 50 other co-sponsors (all Democrats) of H.R. 1479 the “Community Reinvestment Modernization Act of 2009,” who want to expand the CRA to include not just banks but also credit unions, insurance companies and mortgage lenders. Congressman Barney Frank, chairman of the House Financial Services Committee, has supported the idea in the past. The SEIU and ACORN, along with a host of other activist groups, are also behind the effort.

President Obama has been a staunch supporter of the CRA throughout his public life. And his recently announced financial reforms would make the law even more onerous and guarantee an explosion in irresponsible lending. Obama wants to take enforcement of the CRA away from the Federal Reserve, the FDIC and other financial regulators who at least try to weigh bank safety and soundness when enforcing the law, and turn it over to a newly created Consumer Financial Protection Agency (CFPA). This agency’s core concerns would not be safety and soundness but, in the words of the Obama administration, “promoting access to financial services,” which is really code for forcing banks to lend to those who would not ordinarily qualify. Compliance would no longer be done by bank examiners but by what the administration calls “a group of examiners specially trained and certified in community development” (otherwise called community activists). The administration says, in its literature about the reforms, that “rigorous application of the Community Reinvestment should be a core function of the CFPA.”

Oh, joy! Oh, unalloyed happiness! Happy Real Estate Days Are Here Again! Yes, let’s do take the very same instrument that annihilated the housing industry in the first place, make it bigger, wider and load it up with all kinds of extra whammy and at the same time strip it of even the semblance of responsible oversight then turn it loose with complete confidence that this time it will yield a better result. I mean, seriously folks, what could go wrong?

What this is, dear readers, is a baldfaced attempt to re-inflate the housing bubble. Because, you see, housing is a key industry, so if we pump up housing the whole economy will rise with it. And yes sir, it will. It’ll rise for about a year, I guess they’re calculating, just in time to make people happy for the 2010 elections. What else can the incumbents do, after all? It’s not as if their plans were sustainable in the long term, so with the lamentable demise of ACORN they’ve got to figure another way to gin up the votes to stay in office. Evidently they aren’t feeling very confident that the expenditure of the other 85% of the bailout money between now and then will do the trick.

I guess it isn’t bad enough that we are running the printing presses night and day just to come up with money to lend ourselves. It’s not bad enough that the banks are keeping huge chunks of foreclosed homes off the market lest they depress the market (Seriously, what are they going to do, hold ‘em for non-paying tenants forever?). It’s not bad enough that the Fed is handing out trillions of dollars to someone somewhere (Nowhere Man?) and won’t say how much and to whom. No, I guess not.

Seems to me that we are largely recreating the Great Depression in our day. Sure wish I had a nice, thick wad of Euros or Yen or something other than dollars (heck, I’d feel better if I just had it in dollars!) squirreled away somewhere I could fall back on when this Titanic goes down by the head. Sure hope you have a decent plan.

There are days when I wish I were a drinking man.