Wednesday, March 16, 2011

The left has been consistently wrong on foreclosures

The Irvine Housing Blog gets political:
The political left has consistently been wrong on the foreclosure issue. There is a populist issue for the left to embrace: affordability. Instead, they are choosing to pander to distressed homeowners. The robo-signer scandal only gained traction because the political left kept pandering to the false belief that people were wrongly foreclosed upon. ...

Responsible homeowners are not losing their homes. And while we are all shedding tears for unemployed homeowners, what about unemployed renters? ... If we are going to subsidize loan owners with squatting privileges, why don't we do the same for renters? Where is the renter's Bill of Rights (and free handouts)? In my opinion, the political left would be wiser to pander to renters and side with affordability advocates, traditional supporters of the left.
I think the left's pandering to distressed homeowners comes from its innate tendency to view people as victims.


  1. Yeah because John McCain subsidizing home prices is the right thing to do. Both the left and the right are wrong on home prices. Stop the tax incentives, let the market be free, and make sure there are consequences for the actions of both homeowners and banks.

  2. If stock brokers pumped up the value of stocks (appraisals) and encouraged people to purchase more than they could afford, wouldn't we consider their customers to be victims?

    Unfortunately too many brokers and agents were pumping and dumping the American Dream.

  3. You want to know why you don't get many comments? It's because of posts like this. You love to blame the home buyers as if they are morally inferior. But it has always been the responsibility of the banks to lend prudently, to protect their depositors, to ensure the quality of their loans. The banks not only abdicated that responsibility, they became pushers of a debt drug, a drug as attractive as anything you could shoot into your veins. People were told by the lenders not to worry and so they didn't worry. They figured the banks must know what they're talking about, they wouldn't lend them the money if it was a bad bet. But they were wrong -- and it was the greed, the out-and-out greed of the financial community that has brought us where we are today.

    When are you going to get that?

  4. But the banks were being pressured by the GOVERNMENT to get previously ineligible people into homes- whether or not they could afford them. Community activists and government officials orchestrating protests on the front lawns of bank officers- threatening them, threatening their bank charters!!!!!! When are YOU going to get that! It was the social engineeering of the left- taking the view that everyone deserves the same stuff whether they earned it or not that got us into this mess- it's the
    guarantee of the PURSUIT of happiness. not happiness.
    EARNING what you have- not getting it in a government handout.

  5. It comes from their perception that everyone deserves to get everything anyone else has. Equality of outcome- not the equality of opportunity set out in the Declaration, the I have a Dream speech, and the ask not speech of JFK. The loss of connection to the word EARN.

  6. But the banks were being pressured by the GOVERNMENT to get previously ineligible people into homes- whether or not they could afford them.

    Malarkey. The government had anti-redlining pressure for decades and yet things didn't blow up. This is completely the result of the banks figuring out a way to package and hand off the risk to other bagholders - very profitably. The explosion in subprime lending was led by the private label MBS issuers - not the GSEs - and it was done in the search for ever growing profits.

    CDOs - the exotic (more exotic than anything the GSEs concocted) slicing-and-dicing of "risk" were the "innovative financial product" created by the banks which allowed banks to loan to the uncreditworthy. The goverment did not require banks to create and market "No-Income, No-Asset" loans.

  7. 24 of the top 25 largest subprime lenders during the bubble did not have to meet CRA. Fact. 80% of subprime mortgages issued during the bubble came from institutions that did not have to meet CRA. Fact.

    CRA is one of the easiest regulations to meet, it has no hard requirements.

    I can't grasp why you would let bankers and Wall Street cry victim. Do you know how ridiculous that sounds when you make sweeping generalizations about others claiming victim?

    The banks get their own appointed to high posts in the administrations of both parties, they have full regulatory capture (they get to write the laws) and are successfully lobbying for no funding for the pathetic oversight that is left on the books, just as they have successfully done for the last thirty years. On what warped planet in a funhouse mirror universe would that make them victims?