Friday, September 26, 2008

Carpe Diem Reveals the Truth

from the brilliant blog Carpe Diem:

Uncovering the roots of the disastrous home mortgage bubble that popped last year will keep economic historians busy for decades. Yet, one factor has so far been largely overlooked: the bipartisan social engineering crusade to drive up the rate of homeownership by handing out more mortgages to minorities.

More than a negligible amount of the blame for the mortgage meltdown can be traced back to multiculturalism: government-mandated affirmative-action lending, demographic change, illegal immigration, and the mind-numbing effects of political correctness.

Now, I'm a Roman Catholic and I believe deeply in human dignity and preferential treatment for the poor but this statistic show the malevolent affects of affirmative action. A couple of points come to mind:

1) The vast majority of Afro-American poor live in the cities (I know Boston well) and it is nearly impossible to strike a good real estate deal in most cities. To top it off, big city liberal mayors are rapacious tax and spenders. I'm there was no way to buy a home in Boston in 2005 and survive.

2) Ultimately the poor people in these loans are going to be traumatized, their credit will be destroyed and many will never be able to recover from the forclosure, headaches and worry.

3) It would have been one thing to plunk people in 30 year fixed rate loans but saddling first time home buyers with Option-ARMs was pure abuse and a prescription for disaster (like all forms of racism: policies based on race.)

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