When All Esle Fails…

¡Hola! Everybody…
My friend Leese asks if I actually do the ::blank stare:: in real life. To be honest, I rarely do it. I only do it when I’m being sarcastic (or even facetious). By the time I’m at :;blank stare:: I’m actin’ da fool. So, yeah I do the ::blank stare:: in real life, but it’s much more rare than online.

LOL

* * *

-=[ Neocon Pastime: Blame Black Folk ]=-

At the heart of racism is the religious assertion that God made a creative mistake when He brought some people into being.

— Friedrich Otto Hertz


“A black man stole my homework!”

— Excuse most likely to work


I shouldn’t be surprised and somewhere in my gut I guess there was a part of me expecting it. I’ve become almost inured to the “black holes” of racist ignorance that still plagues our society. Still, it does nothing to diminish my disgust when I run up against it: no matter what, it seems, it’s the fault of Black people!

Almost as soon as the financial melt down reared its head and McCaint did his impersonation of dementia, the neocons were hard at work trying to show that it was “minorities” and their liberal enablers that caused the crash of civilization as we know it. The standard-bearers of all that is sane in journalism — the Wall Street Journal, the National Review — and heck, even YouTube — began spreading the myth that the Community Reinvestment Act, a law designed to eliminate discriminatory banking practices, caused the current financial crisis. In the words of Fox News’ Neil Cavuto, “Loaning to minorities and risky folks is a disaster.”

DANG! Black people did it!

It’s an easy swipe and makes for a facile sound bite, but it’s racist nonetheless. Even a cursory look into the issue shows that conservatives have warped the facts in order to validate their revisionism. But don’t be drink the Kool-Aid: the financial crisis was caused by conservative financial bungling and an extended bankers circle jerk.

Period.

What follows are the facts, ma’am…

Myth #1: The Community Reinvestment Act forced banks to make loans to all low-income families and people with poor credit, fining banks that refused to comply.

Fact: The Community Reinvestment Act encouraged banks to lend fairly and responsibly for over 30 years. The Community Reinvestment Act does not impose fines; it regularly examines FDIC-backed banks and issues them a CRA-compliance rating (click here). To receive a high rating, banks must meet the financing needs of as many members of their community as possible and must not discriminate against racial and ethnic groups or certain neighborhoods. However, a bank cannot receive a high rating unless it is also maintains “safe and sound banking practices”(click here) In other words, the CRA requires banks to lend to working-class families and people of color, but only when those people have been deemed credit-worthy.

Myth: The housing bubble burst when too many people with home loans mandated by the Community Reinvestment Act failed to make their mortgage payments.

Fact: More than half of problematic sub-prime loans made in the last few years were issued by banks that are not regulated by the CRA. [U.S. House Committee on Financial Services] The CRA applies only to financial institutions that are insured by the FDIC, but not to independent mortgage companies such as Countrywide. In fact, non-CRA lenders were twice as likely as CRA lenders to issue excessively expensive subprime loans to vulnerable creditors. [Federal Reserve Bulletin] Responsible mortgages made by CRA lenders have a low rate of foreclosure similar to that of traditional mortgages. [Federal Reserve]

Myth: In 1995, Bill Clinton changed the Community Reinvestment Act to allow the securitization of CRA and subprime mortgages.

Fact: The 1995 revisions to the CRA changed only the way in which a bank’s CRA compliance is evaluated; they made no mention of mortgage securitization. [60 F.R. 22156] Under the 1995 rules, banks are rewarded only for making mortgages in their communities, not for re-selling mortgages as securities.

Myth: President Bush and Senator McCain tried to stop the subprime mortgage crisis, but Democrats blocked their efforts.

Fact: Bush and McCain supported the Federal Housing Enterprise Regulatory Reform Act of 2005, which would have created a new government agency to oversee Fannie Mae and Freddie Mac and other federal housing programs. However, the bill would have done nothing to stop the rash of subprime lending that preceded the housing bubble because it provided oversight for only Fannie and Freddie, not for the companies that issued subprime mortgages. [GovTrack]

So there you have it — the facts.

The next time some racist neocon asshole insists on blaming people of color for the global financial meltdown, please be sure to correct them. Be advised that neocons have an inherent inability to absorb facts and may have an adverse effect on your relationship with them. But the fact remains that ignorance needs to dragged out into the clear light of day.

Love,

Eddie

Resources

I relied on the following sources for documentation. I encourage you to read them, for they do a much better job of deconstructing this lie than I can ever hope to.

Sara Robinson’s blog Firing Back on the CRA Libel

Rick Perlstein’s blog The CRA Blood Libel

Isaiah Poole’s blog Countering the Lie About Race and the Meltdown

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