How the Left put the African-American middle class back in chains.
While the worst financial crisis in the United States since the Great Depression was burning through businesses, jobs and credit like a forest fire, decimating the economy and leaving uncertainty in its wake—Barney Frank was looking around for oil to toss on the flames.
On September 16, 2009, the United States House Committee on Financial Services met to discuss the Community Reinvestment Modernization Act of 2009. Underneath that progressive name was the formula to take the entire subprime mortgage crisis and multiply it across as many financial institutions as possible.
Presiding over those hearings was Barney Frank, the congressman who had done so much to bring about the crisis while suppressing the reforms that might have headed it off—and CRMA 2009 displayed the same grandiose level of irresponsibility that had taken down the economy and it was backed by the same poverty pimps who had caused the disaster.
The original Community Reinvestment Act had been passed in the name of racial justice and that was the slogan under which proponents hoped to ram through its lunatic grandchild, the CRMA. But no one had suffered as much from the effects of the CRA and was as endangered by the CRMA as the people whom it was supposed to help.
The subprime mortgage crisis was a trillion dollar Ponzi scheme built on the backs of taxpayers with minorities as its catspaws. Mortgages were issued to unqualified lenders by government mandate at terrible terms, which were then transformed into Mortgage Backed Securities and Collateral Debt Obligations.
The Clinton Administration had turned Fannie Mae and Freddie Mac into factories for low income mortgages, purchased as securities with government subsidies. The year before the bubble burst, subprime mortgages made up over a third of CDO's and 60 percent of subprime mortgages were being issued to African-Americans.
Organizations like ACORN agitated for more government intervention in the mortgage market, supposedly to make home ownership more affordable, while actually serving the interests of the predatory left-wing lenders who were making the loans, like the Sandlers.
The Sandlers invested millions into ACORN and made billions from adjustable rate mortgages in a government backed wealth transfer that was a masterpiece of crony capitalism as left-wing billionaires scored big, while the taxpayers and minority homeowners were left holding the bag.
No one had more responsibility to address the situation and no one did more to prevent anyone from noticing what was about to happen than Barney Frank who kept the lies going, while the Sandlers kept wheeling and dealing. And even once the crisis had arrived, his only solution was to toss more money into the pile.
The entire Ponzi scheme had been run on the pretense of helping minority homeowners, with the result that the median African-American household lost half its net worth in five years.
The progressives had convinced African-Americans to put their money into home ownership, they had regulated and subsidized the banks to make it as easy and pain free as possible, and defrauded them twice over, winning their political support with easy mortgages that got them to sink most of their net worth into home ownership.
When African-American net worth was invested four fifths into home equity, the rug was pulled out from under them. The results were devastating to those who could pay their mortgages and those who couldn't. Subprime mortgages had been heavily marketed even to well-off minorities who didn't need them. As home values fell, those who had the most at stake also had the most to lose.
African-American subprime losses may reach as high as a 100 billion, and as many as one in ten may be facing foreclosure. This is having a devastating effect on their already shaky position in the middle-class... and that is the perversely brilliant part of this scheme.
Not only did the left shamelessly loot the system by dressing up their crony capitalism as social justice, but they also profited from ripping off the very minority borrowers on whose behalf they were gouging taxpayers and banks—with the end result that the minorities who are their voting base are kept out of the middle-class and remain a reliable plantation vote with no hope for anything but government benefits.
Think of a con artist who uses his mark to rip off five other strangers, then rips off his mark, and tosses him a penny, to keep him on the leash for the next round of cons. This is what the left's crony capitalism venture did. This is what Barney Frank was covering up for when he insisted; "I do not want the same kind of focus on safety and soundness ... I want to roll the dice a little bit more in this situation towards subsidized housing."
Barney Frank and friends weren't rolling the dice for subsidized housing over safety because they genuinely cared about minorities-- but because they cared about all the money flowing through the subsidized housing Ponzi scheme. And if that isn't the crime of the century, that's only because the century is still new.
The poverty pimps still weren't done. Foreclosures had a ripple effect in minority neighborhoods as abandoned houses destroyed the property values of neighboring homes and turned back the clock on entire neighborhoods which had been moving forward. A slow African-American exodus began from northern blue states to southern red states as another layer of the scheme unrolled.
And there in the eye of the storm, Barney Frank, the Chairman of the House Committee on Financial Services, sat overseeing a three ring circus promoting the Community Reinvestment Modernization Act. The CRA had helped take down the economy and CRMA would extend the CRA's provisions mandating low income lending by banks to every financial institution in America.
Frank who had bullied and covered up for the unholy marriage of banks, government and ACORN as long as he could-- now wanted to extend the troika everywhere to consolidate the destruction of the African-American middle class for the benefit of the professional left. The subprime mortgage crisis was the new slavery and its end result is an African-American electorate more enslaved to the Democratic Party than ever before.