Kart Rove, in San Fran at the Mortgage Banker's Association trade show yesterday, apparently tried to tar "them" for the financial crisis, according to an SF Chron report.
Fannie Mae and Freddie Mac, the mortgage giants taken over by the government last month, came under fire in the day's opening session, a spirited discussion of politics by an insider from each end of the spectrum: Karl Rove and former Sen. George Mitchell.
Rove, former deputy chief of staff and senior adviser to President Bush, blamed Senate Democrats for not reining in the government-sponsored enterprises.
Rove's among those who want to fix blame for our deep money problems on affordable housing public policies. You may have heard such fart blossoms as that Acorn made Fannie Mae break the US Treasury to provide homes for the poor and for ethnic minorities, using Barney Frank.
In a fine piece of journalism, Private sector loans, not Fannie or Freddie, triggered crisis, (link) By David Goldstein and Kevin G. Hall | McClatchy Newspapers one finds a powerful antivirus to this meme.
As Steve Colbert likes to say, "Facts have a strong liberal bias". See in particular the ratios of public to private loans, and the debunking about who set the trends in market terms (Hint: it was NOT Chuck Shumer or Barney Frank).
In particular, blame for the poor and miority beneficiaries from the Community Redevelopment Act gets play from MSM amplifiers such as Glen Beck, Sean Hannity, Rush Limbaugh, Ann Coulter, Sarah Palin and others whose reach extends to an audience of tens of millions. But, as Goldstein and Hall write in the McClatchy article (link):
"In a speech last March, Janet Yellen, the president of the Federal Reserve Bank of San Francisco, debunked the notion that the push for affordable housing created today's problems.'Most of the loans made by depository institutions examined under the CRA have not been higher-priced loans," she said. "The CRA has increased the volume of responsible lending to low- and moderate-income households.'
In a book on the sub-prime lending collapse published in June 2007, the late Federal Reserve Governor Ed Gramlich wrote that only one-third of all CRA loans had interest rates high enough to be considered sub-prime and that to the pleasant surprise of commercial banks there were low default rates. Banks that participated in CRA lending had found, he wrote, 'that this new lending is good business.'"
Please rec to help to counter lies. When we confront distortions like Rove's we increase the opportunity for change from elections in November, and frustrate the racist impulses behind such fibs.