Clinton Did It, In The DC, With The CRA

Apparently the push back by normal Americans via the TEA parties and such sufficiently put a hold on the far left's push to destroy the United States' economy, started with the collapse of the housing industry. Unable to think of a new tack, they (including Obama) want to give it another go with a bigger and badder CRA, the primary vehicle used to ram the economy the first time. IBD pushes back hard (quotes from the community agitators themselves and a liberal think tank are brutally effective here):

The Greenlining official added: "While some cling dearly to the myth that the CRA was the culprit, simply repeating a statement endlessly does not make it true."

Greenlining's pique is understandable. It helped fuel the subprime crisis by using the CRA to leverage large banks like WaMu for record loan set-asides for uncreditworthy minorities. Then it extorted even more money when the banks announced merger plans, filing protests with federal regulators to delay their bids.

Greenlining even got a sweetheart WaMu mortgage for its own headquarters, according to the new book "The Great American Bank Robbery."...

Ex-Federal Reserve Board Gov. Lawrence Lindsey, a staunch CRA defender, acknowledges that the changes "did contribute to a downgrading of credit standards."...

FACT: Studies show that CRA loans have higher delinquencies and defaults and act as a major drag on bank earnings. In 2008, CRA loans accounted for just 7% of Bank of America's total mortgage lending, but 29% of its losses on home loans. Also, banks with the highest CRA ratings tend to have the lowest safety and soundness ratings.

FICTION: Only 6% of subprime loans were originated by banks subject to the CRA, so the vast majority of risky lending was not tied to the law.

FACT: Among other things, the figure does not count the trillions of dollars in CRA "commitments" that WaMu, BofA, JPMorgan Chase, Citibank, Wells Fargo and other large banks pledged to radical inner-city groups...

All told, they shook down banks for $4.6 trillion in such commitments before the crisis, boasts a report by the National Community Reinvestment Coalition, or NCRC, the nation's top CRA lobbyist (which conveniently removed the report from its website during the FCIC hearings)...

FICTION: "These loans performed well," the FCIC report maintained.

FACT: Brookings found that the loan commitments were set aside for low-income minorities with "marginal credit scores" and posed a higher risk. They were even riskier than regular CRA loans, because the banks delegated underwriting authority to the nonprofit shakedown groups, which had no experience judging credit risk...

Despite repeated requests by Commissioner Peter Wallison, the panel never examined the performance of the trillions in loan commitments...