CRA: The seed of bad fruit
A University of Cincinnati professor has penned an excellent piece that details the Clinton administration’s fault in the subprime implosion.
The Community Reinvestment Act, which Clinton loved, is mostly to blame for getting the ball rolling. The piece skewers the mind-numbed liberals who blame Bush for this situation:
The best thing that can emerge from the current financial crisis is the realization that the government needs to stop directing economic decision making. In a sense, the government is putting out a fire it started when it both created the CRA and assessed lending institutions by how well they were doing in response to the program. When Clinton decided, in his usual arrogance, that he knew better than the market how banks should lend money, the seeds were sown for the current financial disaster.
If you want to blame Bush for the current crisis, it might make you feel good, reinforce your sense of how the world works, enable you to find a meeting of the minds when you next engage your liberal friends over wine and quiche, but like so many things you believe and which make you feel good, it has no correspondence to reality.