Economically and politically, the country is still reeling from the aftershocks of the 2008 housing collapse, which was caused largely by the federal government coercing banks to make bad loans to persons of sacred nonwhiteness for the purpose of redistributing wealth. After all the hardship caused and the $zillions of wealth destroyed, at least our rulers know to back off on applying Affirmative Action to mortgage loans, right? Wrong:
The Obama administration is engaged in a broad push to make more home loans available to people with weaker credit, an effort that officials say will help power the economic recovery but that skeptics say could open the door to the risky lending that caused the housing crash in the first place. …
Obama pledged in his State of the Union address to do more to make sure more Americans can enjoy the benefits of the housing recovery, but critics say encouraging banks to lend as broadly as the administration hopes will sow the seeds of another housing disaster and endanger taxpayer dollars.
Obamunist bureaucrats are “encouraging lenders to use more subjective judgment in determining whether to offer a loan.” This offers a clue as to what is meant by “subjective judgment”:
The administration’s efforts come in the midst of a housing market that has been surging for the past year but that has been delivering most of the benefits to established homeowners with high credit scores or to investors who have been behind a significant number of new purchases.
“If you were going to tell people in low-income and moderate-income communities and communities of color there was a housing recovery, they would look at you as if you had two heads,” said John Taylor, president of the National Community Reinvestment Coalition, a nonprofit housing organization.
People who have worked hard and have made major sacrifices to retain their high credit scores should not be allowed to enjoy a rebound in the housing market while “communities of color” have to live within their means. That wouldn’t be Hopey Changey.
Deciding which borrowers get loans might seem like something that should be left up to the private market. But since the financial crisis in 2008, the government has shaped most of the housing market, insuring between 80 percent and 90 percent of all new loans, according to the industry publication Inside Mortgage Finance. It has done so primarily through the Federal Housing Administration, which is part of the executive branch, and taxpayer-backed mortgage giants Fannie Mae and Freddie Mac, run by an independent regulator.
The word for this arrangement — whereby nominally free market sectors of the economy are actually rigidly controlled by authoritarian bureaucrats — used to be fascism. But that word now means almost exactly the opposite of what it did in the days of Mussolini and Hitler. Now it can be defined as “anything liberals don’t like.” So we’ll call current housing policy corporatism — a stepping stone to the straightforward communism that is only one or two more government-engineered crises away.
On tips from Bob Roberts, Sam Adams, G. Fox, and Artfldgr.