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  • Connecting the Dots: Fannie, Freddie and ACORN

    Since the housing bubble first began to burst, we have been quick to note the integral role that government-sponsored entities Fannie Mae and Freddie Mac played in distorting the housing market. However, we have also been skeptical of some claims that the Community Reinvestment Act (CRA) played in facilitating the crisis. The more we study, though, the more we see how the CRA, Fannie and Freddie, and now ACORN, all worked together to get us where we are today. Stanley Kurtz connects some dots in the New York Post:

    The CRA’s ostensible purpose is to prevent banks from discriminating against minorities. But Rep. Marge Roukema (R-NJ), who chaired the subcommittee, was worried that charges of discrimination had become an excuse for lowering credit standards. She warned that new, Democrat-proposed CRA regulations could amount to an illegal quota system.

    FOR years, ACORN had combined manipulation of the CRA with intimidation-protest tactics to force banks to lower credit standards. Its crusade, with help from Democrats in Congress, to push these high-risk “subprime” loans on banks is at the root of today’s economic meltdown.

    When the role of ACORN and congressional Democrats in the mortgage crisis is pointed out, Democrats reply that banks subject to the CRA represent only about a quarter of the loans that led to our current troubles. In fact, the problem goes way beyond the CRA.

    As ACORN ran its campaigns against local banks, it quickly hit a roadblock. Banks would tell ACORN they could afford to reduce their credit standards by only a little – since Fannie Mae and Freddie Mac, the federal mortgage giants, refused to buy up those risky loans for sale on the “secondary market.”

    That is, the CRA wasn’t enough. Unless Fannie and Freddie were willing to relax their credit standards as well, local banks would never make home loans to customers with bad credit histories or with too little money for a downpayment.

    So ACORN’s Democratic friends in Congress moved to force Fannie Mae and Freddie Mac to dispense with normal credit standards. Throughout the early ’90s, they imposed ever-increasing subprime-lending quotas on Fannie and Freddie.

    Posted in Economics [slideshow_deploy]

    10 Responses to Connecting the Dots: Fannie, Freddie and ACORN

    1. Pingback: » The ACORN - Fannie/Freddie Connection

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    3. Pingback: Democrats On Best Political Blogs » Blog Archive » The ACORN - Fannie/Freddie Connection

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    5. Pingback: Bad Credit On Credit Speak » The ACORN - Fannie/Freddie Connection

    6. Pingback: Bad Credit On Credit Speak » Connecting the Dots: Fannie, Freddie and ACORN

    7. Pingback: Democrat On Best Political Blogs » Blog Archive » The ACORN - Fannie/Freddie Connection

    8. Bill San Antonio TX says:

      Every single legislator and POTUS, past and present, who have neglected to investigate this organization is responsible.

      When an organization is a "non-profit" and receives taxpayer money in the millions, and in known as a predominately left wing Democrat extension – then what the " " is going on?! They are political affiliated with overwhelming support for ONE party. What happened to NON-POLITICAL AND NON-PROFIT?

      This is as bad as it gets. The few that did try to investigate were shut down – quick. Why is that? What were they afraid of – being called a racist, maybe? If that is so, what a poor excuse for not keeping tabs on this organization.

      Where was the leadership from the very top? Where is the leadership from the very top, now?

      While people strive to obey the law, government fraud and corruption continues.

      People deserve to know where the tentacles reach. Who is entwined? Who is getting rich off of lobbyists and this political machine?

      It is surely telling that the mainstream media does not pursue this "story" with a vengence. Why is that?

    9. Pingback: 7 Democratic Senators Stand with Barack Obama’s ACORN

    10. Victoria says:

      I remember seeing a video last year, which I can no longer pull up, that showed a meeting with Charlie Rangel, Barney Frank, Acorn and Barack Obama espousing the new relaxed rules at Fannie and Freddie. These men were all in on this from the very beginning. That the Obama ties to this have not been investigated is wrong. If they truly believed in their crusade they should be willing to accept the responsibility for the devastation it has caused now. They were certainly willing to accept the accolades when all the praising was going on. They used Jessie Jackson tactics on the banks and have singlehandedly perpetrated one of the most widespread financial meltdowns in world history. I pray that everything that happened in all of this be exposed and all the intentions behind it be revealed. That no longer will they be able to hide what their true goals are. I pray their agendas be brought to an abrupt halt and that their true colors be shown. I pray for the spirit of confusion to enter into the midst of those who traffic in corruption in Washington. That it enter into those who would destroy our liberty and freedom in America. I pray that those in power in Washington who despise what our Constitution stands for, who mock what our Founding Fathers fought for, would find themselves cut off at every point. May the Spirit of God enter into the leadership of Washington and repentance be poured out on Capital Hill in the hearts and minds of those who rule there. May true leadership, integrity, honor, wisdom and understanding be established.

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