Plant a seed…find an ACORN


Stanley Kurtz at National Review has perhaps the best 3 page summary of how ACORN was the catalyst way back in the late 1970’s that got the Fannie Mae/Freddie Mac financial disaster rolling.

This certainly sheds light on the history of Freddie Mac/Fannie Mae and ACORN at the advent of the lending crisis. You can read his piece here.  I’ll put some excerpts below.

First, the last sentence of his piece, pretty much sums up Obama’s roll in the ACORN mess:

And Barack Obama cut his teeth as an organizer and politician backing up ACORN’s economic madness every step of the way.

Militant ACORN:

At the time, however, that 1995 Chicago newspaper article represented something of a triumph for Barack Obama. That same year, as a director at Chicago’s Woods Fund, Obama was successfully pushing for a major expansion of assistance to ACORN, and sending still more money ACORN’s way from his post as board chair of the Chicago Annenberg Challenge. Through both funding and personal-leadership training, Obama supported ACORN. And ACORN, far more than we’ve recognized up to now, had a major role in precipitating the subprime crisis…………………..

……..Far more than we’ve recognized, ACORN’s local, CRA-enabled pressure tactics served to entangle the financial system as a whole in the subprime mess. ACORN was no side-show. On the contrary, using CRA and ties to sympathetic congressional Democrats, ACORN succeeded in drawing Fannie Mae and Freddie Mac into the very policies that led to the current disaster.

ACORN’s Inside Strategy:

ACORN’s efforts to undermine credit standards in the late 1980s taught it a valuable lesson. However much pressure ACORN put on banks to lower credit standards, tough requirements in the “secondary market” run by Fannie Mae and Freddie Mac served as a barrier to change. Fannie Mae and Freddie Mac buy up mortgages en masse, bundle them, and sell them to investors on the world market. Back then, Fannie and Freddie refused to buy loans that failed to meet high credit standards……

……So the eighties taught ACORN that a high-pressure, Alinskyite outside strategy wouldn’t be enough. Their Washington lobbyists would have to bring inside pressure on the government to undercut credit standards at Fannie Mae and Freddie Mac. Only then would local banks consider making loans available to customers with bad credit histories, low wages, virtually nothing in the bank, and even bankruptcies on record.

ACORN and the Democrats:

By July of 1991, ACORN’s legislative campaign began to bear fruit. As the Chicago Tribune put it, “Housing activists have been pushing hard to improve housing for the poor by extracting greater financial support from the country’s two highly profitable secondary mortgage-market companies. Thanks to the help of sympathetic lawmakers, it appeared…that they may succeed.” The Tribune went on to explain that House Democrat Henry Gonzales had announced that Fannie and Freddie had agreed to commit $3.5 billion to low-income housing in 1992 and 1993, in addition to a just-announced $10 billion “affordable housing loan program” by Fannie Mae. The article emphasizes ACORN pressure and notes that Fannie and Freddie had been fighting against the plan as recently as a week before agreement was reached. Fannie and Freddie gave in only to stave off even more restrictive legislation floated by congressional Democrats……

……Many news reports over the ensuing months point to ACORN as the key source of pressure on congress for a further reduction of credit standards at Fannie Mae and Freddie Mac. As a result of this pressure, ACORN was eventually permitted to redraft many of Fannie Mae and Freddie Mac’s loan guideline.

Bill Clinton and ACORN:

With the advent of the Clinton administration, however, ACORN’s fortunes took a positive turn. Clinton Housing Secretary Henry Cisnersos pledged to meet monthly with ACORN representatives. For ACORN, those meetings bore fruit…….

……So by the 1993, a grand alliance of ACORN, national Democrats, and local bankers looking for someone to lessen the risks imposed on them by CRA and ACORN were uniting to pressure Fannie and Freddie to loosen credit standards still further.

At this point, both ACORN and the Clinton administration were working together to impose large numerical targets or “set asides” (really a sort of poor and minority loan quota system) on Fannie and Freddie. ACORN called for at least half of Fannie and Freddie loans to go to low-income customers. At first the Clinton administration offered a set-aside of 30 percent. But eventually ACORN got what it wanted. In early 1994, the Clinton administration floated plans for committing $1 trillion in loans to low- and moderate-income home-buyers, which would amount to about half of Fannie Mae’s business by the end of the decade. Wall Street Analysts attributed Fannie Mae’s willingness to go along with the change to the need to protect itself against still more severe “congressional attack.”

This sweeping debasement of credit standards was touted by Fannie Mae’s chairman, chief executive officer, and now prominent Obama adviser James A. Johnson. This is also the period when Fannie Mae ramped up its pilot programs and local partnerships with ACORN, all of which became precedents and models for the pattern of risky subprime mortgages at the root of today’s crisis. During these years, Obama’s Chicago ACORN ally, Madeline Talbott, was at the forefront of participation in those pilot programs, and her activities were consistently supported by Obama through both foundation funding and personal leadership training for her top organizers.

DISASTER:

In the end of course, Clinton’s plan cost taxpayers an almost unimaginable amount of money. And it was just around the time of his 1995 announcement that the Chicago papers started encouraging bad-credit customers with “dog-food” wages, little money in the bank, and even histories of bankruptcy to apply for home loans with the help of ACORN. At both the local and national levels, then, ACORN served as the critical catalyst, levering pressure created by the Community Reinvestment Act and pull with Democratic politicians to force Fannie Mae and Freddie Mac into a pattern of high-risk loans.

Up to now, conventional wisdom on the financial meltdown has relegated ACORN and the CRA to bit parts. The real problem, we’ve been told, lay with Fannie Mae and Freddie Mac. In fact, however, ACORN is at the base of the whole mess. ACORN used CRA and Democratic sympathizers to entangle Fannie and Freddie and the entire financial system in a disastrous disregard of the most basic financial standards. And Barack Obama cut his teeth as an organizer and politician backing up ACORN’s economic madness every step of the way.

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13 Responses

  1. On the right track. I covered his relationship with former PLO member Rashid Khalidi today on my blog. Give it a read if you want…

    http://clancop.wordpress.com

  2. What’s so frustrating is so many don’t care. I’ve had pro-Obama bloggers delete comments of mine because I brought this issue up. They want the image, not the true Obama…

  3. ACORN and Ayers. That all you got? Hillary tried that and it didn’t work. Now you’ve got McCain defending Obama and Palin guilty of corruption. Nah, nah, nah nah. Nah, nah, nah nah. Hey, hey, hey, good-bye!

  4. Easy comrade.

  5. You know what’s silly about all of these stories of Obama’s questionable associations? You guys tried this sort of thing back in ’92. Then Governor Bill Clinton had been reported to have made a trip to Moscow when he was younger. You know what that meant to the radical right? He was a KGB plant! Oh my goodness. We were going to be annexed by Russia!

    Obama isn’t perfect, but he’s not going to replace the CIA with ACORN and he isn’t going to put Ayers in his Cabinet. He’s not going to declare himself the Messiah dictator and he isn’t going to turn us into the USSR. You want to talk about guilt by association? If McCain and Palin are without sin, let them cast the first stone. Oh? McCain is defending Obama now? I wonder why.

  6. Golden,
    Guess you haven’t read much news, blogs, or even my blog in researching for whom to vote for President.

    Obama is MUCH more than ACORN and Ayers…..you might try looking up a few more issues/names like Wright, Interfering with Iraq during a War, Infanticide, Fighting to overturn 2nd Amendment Rights, Obama’s assaults on the 2nd Amendment, Saul Alinksy, Frank Marshall Davis, Louis Farrakhan, Tony Rezko, Raila Odinga, Rashid Khalidi, Jim Johnson, Franklin Raines, to name only some of his Socialist, Radical roots, ties, and mentors.

    But I guess you are more for the image of THE ONE than really anything that may call into question his world view, his dealings, corruption, or experience.

  7. Sharprightturn,

    Nice list of names. Sounds like a bunch of folks that have problems. I assume you think these are the only people he associates with and that none of the people he calls friends or family believe in the ideals and the goodness of America. If he lived solely on the ideas of these people you list, why would he run for leader of the country that he must hate so much because of these associations? Because he’s a Manchurian candidate? You guys tried that back in ’92 against a certain then-Governor Bill Clinton. Apparantly in his younger years, Clinton made a trip to Moscow. According to radical right-wingers, this made him a KGB plant! Well, to their disappointment and I would assume, relief, 8 years later we were still as democratic and red,white, and blue as ever. If Obama were to become President – what do you think he could do to irreversably damage America before we would call for impeachment and removal from office? The President is not a dictator who can run the country to his personal whims and get away with it. Bush got close, but that’s another discussion. Anyway, the Founding Fathers built safeguards into the Constitution to protect us from such blatant abuse of power: The power to impeach, and the 4-year limit on a Presidential term. Then with the 22nd Amendment, the number of terms was limited to two 4-year terms. I think the Founders were smarter than you give them credit for, so I’m pretty sure there’s no chance Obama’s going to turn us into the “USSA” as I’ve seen alot of paranoid Conservatives post. So I don’t understand what it is you’re trying to address by bringing up these associations. His judgment? Do you think Obama runs background investigations on people before he decides to talk to, much less associate with them? Maybe his ties to Ayers mean that he’ll be more sypathetic to terrorists abroad? He’s stated many times that he wants to find bin Laden and kill him, just like every other American. He wants to sit down with folks we consider enemies, like Iran, because the Bush Doctrine and cowboy diplomacy doesn’t work.

    I haven’t seen Obama accused of any criminal actions either. McCain was investigated for his associations with the criminal Charles Keating. He was found innocent, but admitted to “bad judgment” regarding his involvement. Sarah Palin was just found guilty of abusing her power as Gov. of Alaska by a bipartisan commission. Here’s the link to the findings from your favorite news channel:

    http://www.foxnews.com/projects/pdf/DOWNLOAD.pdf

    Also, her husband was part of an anti-American political party up in Alaska that calls for secession of Alaska from the Union. She recorded a commencment address video for one of the Alaska Independence Party’s conventions and told them to “…keep up the good work…” Look it up on YouTube if you don’t believe me. I haven’t seen 24 hour repetition of these stories on the so-called liberal elite media. If they are really in the tank for Obama, why don’t they report on these things?

    I respect John McCain very much; first for his service and sacrifice for his country and secondly because he is by nature a good man. He heeded your calls for questioning Obama’s associations and character and now after one week, he’s trying to put the genie back in the bottle. After Palin originally “let the genie out” a week ago, chants at McCain/Palin rallies have turned downright hateful. McCain is too good of a man to adopt your desire for character assasination and understands how it feels because he was the victim of it when he ran against George Bush in the 2000 Republican primaries.

    Speaking of history, it’s funny how the “family values” theme has fallen off the the Republican bandwagon all of a sudden. Back in the ’92 election, Bill Clinton’s reported affair with one Gennifer Flowers became a big deal and point of Republican attack. Then the famed “Republican Revolution” of ’94 rallied around the family values theme after Bill Clinton ended his last term in office amidst a sex scandal. It was like Newt Gingrich couldn’t say the two words enough. I have a feeling that if it was Obama who cheated on his wife, as McCain did with his first wife, or if it was one of Obama’s daughter’s that had a child as a teen out of wedlock; then family values would be the topic of the hour again in Conservative circles.

    I don’t pretend that Obama is perfect, or some kind of Messiah. But I look at his flaws with the mindset that McCain, Palin, Biden, and all of the rest of us have flaws. Wait, your sarcastic comment will be something like, “I don’t know any terrorists? Do you?” Nope, but I’m sure Obama’s not the only person Ayers knows. So I assume every person that has associated with this man, Ayers, has character flaws and precludes them from even considering running for public office, right? I look at these associations you address as things that he should clarify to the American public, but also I understand that the main people who shaped his life were his American born mother and grandparents. McCain understands this and has corrected some of the fear rhetoric and misconceptions at one of his latest rallies, I’m sure to your disappointment. You can be as anti-Obama as you want, it’s your blog. But the only ones you’re getting through to are folks who already don’t want to vote for Obama, not that they’re 100% behind McCain, but because they just plain refuse to vote for Obama. The only way McCain can breakthrough to the votes he does need, independents and undecideds, will be with talk about the economy. And according to his own campaign, if that’s the way he goes, he’ll lose the election. So with that said, I completely understand the premise of your blog. Nothing about how McCain can fix America… just why you shouldn’t vote for the other guy. Good luck.

  8. Golden Parachute,

    “If he lived solely on the ideas of these people you list, why would he run for leader of the country that he must hate so much because of these associations? ”

    Duh…have you heard his hope and change speeches?….I expect that the change he plans it not the change many of his followers expect. Oh, yes, those who follow him to get something for free from the others in this country that work their tails off, will love Obama…..
    But if you believe that Obama will follow capitalism and the American way in changing this country, you obviously aren’t paying attention.

    “The President is not a dictator who can run the country to his personal whims and get away with it. Bush got close, but that’s another discussion.”
    Most radical socialists hell-bent on changing America and “seeing her downfall” (as Obama’s friends like to say) don’t plan to play by the rules anyway….Nothing in Obama’s past gives me great comfort that he will follow the rules. (ie his house purchase with Rezko, his sleazy minions at ACORN who recieved $800K to get out the voter fraud, his sleazy campaign tactics when running for Senator of Illinois, his orders to harass those how speak out against him, his efforts to undermine our 2nd Amendment with anti-gun law reviews, etc.)
    Also, with regards to Bush, you liberals have conjured up a lot of ideas in your heads about Bush all from your seething hatred of the man……so don’t lecture me on my thoughts of Obama.
    YOu can’t name one dictatorial motion Bush has taken…..with any facts to back it up, that is.
    Oh, and by the way, you can thank Bush for no further terrorist attacks on our soil….or have you forgotten there are those who want to see us dead? (BTW, many of them openly endorsing Obama)

    How can you know who shaped Obama’s life? He has never been truthful about most of it….and by the way, his mother was an atheist/Socialist….is that the type of man you want at the helm of our country?

    America has lots of problems right now…..and I’m sure that you will never admit that many of the come at the hands of the Democrats…..where is that most ethical Congress Pelosi talked about? They’ve done NOTHING substantial except overlook, for political gain, the sinking ship of Fannie Mae and Freddie Mac….all while your candidate took huge amounts of campaign cash from them…..
    How about Barney Frank and Chris Dodd as leaders of banking and financial committees? They bear much of the responsibitlity and have owned up to none of it.
    While I don’t expect McCain will be the saviour (as many Obamabots believe of Obama), I do believe he has much more experience and savvy than Obama. McCain can be Commander in Chief day one. Obama wants to invade Pakistan, was wrong on the War and pressed for leaving in defeat. Obama believes Iraq was a wrong war and that Saddam apparently wasn’t involved in any human rights violations. I say that because Obama believes we should be militarily in the Sudan and other places because of human rights violations, but not Iraq. No clear undestanding from Obama.
    Obama has also stated early in the campaign that he will basically decimate many of our deterrent missile and other military capabilities. McCain will focus clearly on the need to defend ourselves and implement diplomacy and peace through strength. Obama hopes he can just talk our enemy leaders to death.

    Obama also wants to hand over almost $1 trillion more to corrupt countries for “aid”. He obviously doesn’t have the experience to realize that until change is affected in other ways than financial, we are basically giving to the rich in those countries and those violated never see it. Interesting that he would love to throw money very inefficiently at those problems, but believes all moneys involved in WINNING a war are in vain.

    McCain will not raise taxes which is the best approach in this (or any other) economic climate. Obama will raise them on everyone by discontinuing the tax rates we currently enjoy….increase taxes further on those who produce jobs and pass that money on as hand outs to those who don’t pay taxes….that is his plan in a nutshell. read it….his rhetoric is a lie. He has a Socialist tax plan wrapped in pathetic lie of cutting taxes for 95% of Americans when only 60% even pay taxes.

    McCain is not my perfect candidate, but I do believe he is qualified to be our President at many levels.

    You are right about one thing….I will vote for the candidate that is not perfect over the un-American and inexperienced one.
    I will never vote for a Socialist dressed in moderate clothes, a Marxist all dressed up in hope and change, nor a grossly inexperienced candidate masked in good oratory skills.

  9. “Also, with regards to Bush, you liberals have conjured up a lot of ideas in your heads about Bush all from your seething hatred of the man……so don’t lecture me on my thoughts of Obama.”

    I don’t hate Bush, I just think he ran the country into the ground. He actually seems like a guy you’d want to have a beer with – just like Palin… uh-oh.
    If I hated the man, I’d probably start a blog disguised as one based on moral/political ideology – let’s say I’ll call it “Sharp Left Turn, A Progressive View of News & Politics.” But the only things I’d post are anti-Bush propaganda and maybe one or two posts of how cute Obama’s kids are.

  10. Golden Parachute,

    I have never once said I “hate” Obama…..seems to me that people who support Obama get awfully upset when their rose-colored glasses view of him gets a little skewed with the facts……and those presenting facts are haters and angry…..it would be funny if not so serious.

    In addition, my blog started with a variety of topics a year ago…..since this is an election year, and there are many things wrong with the leading candidate, I am supposed to be sitting here extolling his virtues and highlighting his associates who LOVE America?
    If that’s the case, I MIGHT be up to about 2 posts by now.

  11. Sharp Right Turn,

    I never once said you “hate” Obama either. But that must’ve been something you perceived.

    You also perceived that since I wrote one negative sentence about Bush in a previous reply I was a liberal who had a “…seething hatred of the man…”.

    Okay, let’s continue down your path of logic: If I wrote one negative sentence about a guy and that means it’s “seething hatred”. What praytell could someone perceive from a blog full of pages and pages of negativity about another guy? Hmmm… give me a word worse than “seething” and you can put it in front of “hatred” and that should about cover it.

    If I’m wrong(and remember now, we’re using your logic), then would it be fair to say that all of your perceptions about Obama are wrong too? No, of course not. Somehow you’ll argue that the two are mutually exclusive, dismiss it, and call me a crazy Lib. Standard right-wing fare: I’m always right because I’m Right. Well, I’ll leave you to your negativity. No use sticking around since I’ve seen how you treat people who disagree with you. Whether they come with facts or they come with farce, they’re always wrong. Good luck in November though. I’ll bookmark you and check in after the election. The way it looks now, “seething hatred” will be like butterflies and rainbows compared to what I’m sure I’ll see from you guys then.

  12. Hey Golden,

    Difference is you have no real facts to back up 90% of what you say….it is Dem talking points.

    At least my facts are referenced by YouTube, internet or news article 99% of the time.

    But what is interesting is you haven’t once commented on the subject of this post directly.

    Makes me think you might just be a troll who likes to “have fun with politics”….

  13. Golden Parachute = FWP

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