


We've heard much from the media about CDOs, CDSs, and other previously obscure abbreviations. But we should be hearing more about this acronym: ACORN.
ACORN, as National Review readers will know, is a "community-organizing" outfit with which Senator Obama was once closely allied, and for which he did work. ACORN has made a cottage industry out of leaning on banks and government to extend credit to house buyers who were bad risks for mortgages, i.e. subprime borrowers.
Americans for Limited Government calls them out today:
Americans for Limited Government President Bill Wilson today called upon Congressional leaders in a letter not to help people stay in homes they could never afford in the first place, and who would have never qualified for loans if the government had not encouraged loose lending.
The letter was addressed to House Speaker Nancy Pelosi (D-CA), House Republican Leader John Boehner (R-OH), Senate Majority Leader Harry Reid (D-NV), Senate Minority Leader Mitch McConnell (R-KY), Senator Barack Obama (D-IL), and Senator John McCain (R-AZ).
“The tens of millions of American families who have played by the rules and paid their bills must not be forced to bear the burden for reckless decisions made by the government,” wrote Wilson in his letter.
In a statement, Wilson laid the blame for loose lending at the government’s feet. “Thanks to the federal government artificially setting low interest rates and using the so-called Government Sponsored Enterprises Fannie Mae and Freddie Mac as a housing welfare program, the bad loans made now threaten the greater economy.”
Wilson explained in more detail, “The government encouraged risky loans to low-income individuals via laws like the Community Reinvestment Act, plus with Clinton administration regulations of 1995 overseen by then-HUD Director Andrew Cuomo that made Fannie and Freddie the leaders in the subprime mortgage market.”
... As a result, Wilson believes that the Community Reinvestment Act and the 1995 regulations must be permanently repealed. According to the letter, “The government should not be encouraging loose credit to help low-income individuals to purchase homes. Instead, it must encourage honest credit so that there is not a repeat of the current mistakes. Only then will the true market demand for housing be known. The loose lending practices, and housing welfare programs administered by federal regulations and laws must be repealed.”
... In his statement, Wilson implored Congress not to repeat the same mistakes again: “The root cause of this problem was the government-created loose lending standards. If Congress should address anything, it should be to put an end, once and for all, to the ACORN-inspired housing welfare program that has pulled the nation’s economy into the most turbulent waters it has seen since the Great Depression.”
Imagine if the housing bubble hadn't burst, but there hadn't been all those dodgy subprime loans made and then securitized. We'd be reading stories about how America is having a wonderful housing boom but the poor and minorities are being left out. There's lots of greed and stupidity in this story, but we shouldn't ignore the fact that a big part of what is wrong comes from bad public policy designed to encourage homeownership, particularly among the poor. Unintended consequences are not to be denied.
But we're not going to hear much about ACORN's role in all this, or, by extension, Senator Obama's.
(media.nationalreview.com)