NY Times: Bush Philosophy Stoked Mortgage Bonfire

[babylonsister]

White House Philosophy Stoked Mortgage Bonfire

By JO BECKER, SHERYL GAY STOLBERG and STEPHEN LABATON
Published: December 20, 2008

“We can put light where there’s darkness, and hope where there’s despondency in this country. And part of it is working together as a nation to encourage folks to own their own home.” — President Bush, Oct. 15, 2002

snip//


Eight years after arriving in Washington vowing to spread the dream of homeownership, Mr. Bush is leaving office, as he himself said recently, “faced with the prospect of a global meltdown” with roots in the housing sector he so ardently championed.

There are plenty of culprits, like lenders who peddled easy credit, consumers who took on mortgages they could not afford and Wall Street chieftains who loaded up on mortgage-backed securities without regard to the risk.

But the story of how we got here is partly one of Mr. Bush’s own making, according to a review of his tenure that included interviews with dozens of current and former administration officials.

From his earliest days in office, Mr. Bush paired his belief that Americans do best when they own their own home with his conviction that markets do best when let alone.

He pushed hard to expand homeownership, especially among minorities, an initiative that dovetailed with his ambition to expand the Republican tent — and with the business interests of some of his biggest donors. But his housing policies and hands-off approach to regulation encouraged lax lending standards.

more...

http://www.nytimes.com/2008/12/21/business/21admin.html?hp

[gratuitous]

1. This won't play well with the Legacy Project

I find it odd that the program that seems to have captured Bush's attention in a way that hasn't been seen since he ordered all that death and destruction in 2003 is his little legacy project. And now, here's the Times, one of Bush's most faithful scribes, biting the hand of the master! Where have you gone, Elisabeth Bumiller?

I mean, how could anyone have foreseen that lenders would write mortgages to unqualified applicants? I mean, that they'd just pocket a tidy little commission and then sell the mortgage off to someone else? Who knew they could be so greedy?

[marmar]

2. And like any sociopath, I'm guessing he completely fails to see his own culpability in all of this..

:argh:

[Doctor_J]

3. He fails to see his culpability in ANY of the disasters of the last 8 years

The war, Iran, Pakistan, the Taliban resurgence, global warming, US-as-enemy-of-the-world, torture, the economy... Nothing is his fault, according to him

[notesdev]

6. Remind him of this then

June 2, 2002

PRESIDENT CALLS FOR EXPANDING OPPORTUNITIES TO HOME OWNERSHIP
St. Paul AME Church
Atlanta, Georgia

.... Now, we’ve got a problem here in America that we have to address. Too many American families, too many minorities do not own a home. There is a home ownership gap in America. The difference between Anglo America and African American and Hispanic home ownership is too big. (Applause.) And we’ve got to focus the attention on this nation to address this.(Applause.)

And it starts with setting a goal. And so by the year 2010, we must increase minority home owners by at least 5.5 million. In order to close the homeownership gap, we’ve got to set a big goal for America, and focus our attention and resources on that goal. (Applause.)

And I picked a good man to help realize that goal, in Mel Martinez.”....(Applause.)

....Less than 50 percent of African Americans are part of the homeownership in America. And less than 50 percent of the Hispanics who live here in this country own their home. And that has got to change for the good of the country. It just does. ....(Applause.)

....And we want to fully implement the Section 8 housing program, homeownership program. The program will provide vouchers that first-time home buyers can use to help pay their mortgage or apply to their downpayment. ......(Applause.)

.... That’s why I’ve challenged the industry leaders all across the country to get after it for this goal, to stay focused, to make sure that we achieve a more secure America, by achieving the goal of 5.5 million new minority home owners. I call it America’s home ownership challenge.(Applause.)

And let me talk about some of the progress which we have made to date, as an example for others to follow. First of all, government sponsored corporations that help create our mortgage system — I introduced two of the leaders here today — they call those people Fannie May and Freddie Mac, as well as the federal home loan banks, will increase their commitment to minority markets by more than $440 billion. (Applause.) I want to thank Leland and Franklin for that commitment. It’s a commitment that conforms to their charters, as well, and also conforms to their hearts.(Applause.)

This means they will purchase more loans made by banks after Americans, Hispanics and other minorities, which will encourage homeownership. Freddie Mac will launch 25 initiatives to eliminate homeownership barriers. Under one of these, consumers with poor credit will be able to get a mortgage with an interest rate that automatically goes down after a period of consistent payments. (Applause.)

Fannie Mae will establish 100 partnerships with faith-based organizations that will provide home buyer education and help increase homeownership for their congregations. I love the partnership. (Applause.)

The Enterprise Foundation and the local initiative support corporation will increase efforts to build and rehabilitate more homes in inner cities at affordable prices by working with local community development corporations.(Applause.)

In my home state of Texas, Enterprise helped turn the once decaying ideal neighborhood of Dallas into a vibrant community, by building homes that were sold to residents at affordable prices. The National Association of Home Builders will team up with local officials, home builder associations and community groups in 20 of our nation’s largest housing markets, to focus on how to eliminate barriers, and encourage homeownership.(Applause.)

The Neighborhood Reinvestment Corporation will dramatically expand financial and home buyer education efforts to 380,000 minority families. The Neighborhood Housing Services of America will raise $750 million to promote homeownership initiatives in many communities. We’re beginning to use the Internet better, so that realtors all across the country will be able to call up programs all designed to help minority home buyers understand what’s available, what’s possible, and what to avoid. The National Realtors Association will create a central data bank of affordable housing programs, which will be made available to agents, real estate agents, to help people. ....”(Applause.)

[Idealism]

4. Why is it that no one heeds my warnings >_

I've been trying to shed light on the mortgage industry seeing as thats where I get my paycheck from, but its like banging your head against a wall. People don't understand just how much bad stuff took place, and how many smart people looked the other way because of the easy money to be had.

[notesdev]

5. How could one miss it?

How many years did he go on and on about his "Ownership Society" bull crap?

He did his damn best to make it seem like you were missing the boat if you didn't buy into the housing bubble.


(edit) I should add the morbid joke that came out when the bubble popped... the 'Pwnership society'