Letter: How the meltdown started
What a financial mess this country is in! How did we get here? Barack Obama, as usual, blames the Bush administration and conservative fiscal policies of less regulation. The truth is that this comes down to the problems with quasi-government agencies Fannie Mae and Freddie Mac. They were buying mortgages given to people who could not pay them back.
Why were these types of mortgages ever written? According to many publications, including Investor's Business Daily, the Clinton administration, believing everyone is entitled to own a home regardless of ability to pay, added new regulations to the Community Redevelopment Act. These tough new regulations forced lenders into high-risk areas where they had no choice but to lower lending standards. If lenders did not comply they were subject to stiff government penalties.
John McCain, seeing the problem evolving, co-sponsored a bill in 2005 that would have stopped these practices and most likely averted this crisis. Democrats including Chris Dodd, Charles Schumer and Barack Obama fought against this bill and in the end not one Democrat senator voted for this bill so it never made it into law. Why should they, especially when Obama and Dodd were receiving huge campaign contributions from Fannie and Freddie? Fannie and Freddie were also funneling huge amounts of money into extreme left-wing groups like ACORN, the Association of Community Organizations for Reform Now.
Not only did these liberal policies cause a multitude of bad loans, but then Franklin Raines ran Fannie Mae into the ground by using fraudulent accounting practices and he left in disgrace, but only after looting Fannie for almost $100 million. (Franklin Raines was Clinton's director of the Office of Management and Budget.)
Another Clinton pal, Jamie Gorelick, and Obama advisor Jim Johnson, also worked at Fannie Mae and got out of there with another $75 million. Why are these people not in jail?
We all know that if Democrats could find a Republican to blame for this mess, they would have already hauled them up to Capitol Hill for hearings. But since it's Democrats that caused this problem, there will never be a hearing, much less prosecutions of the people at fault.