American Elephants

Barack Obama’s connections to the sub-prime mortgage mess. by The Elephant's Child
September 29, 2008, 10:21 pm
Filed under: Economy, Election 2008, Liberalism | Tags: , , ,

One of the big sticking points in the debate over the financial bailout bill has been the Democrat attempt to include more funding for ACORN.  ACORN (the Association of Community Organizations for Reform Now) has been in the forefront of encouraging banks to make home loans to high-risk borrowers.  Barack Obama was a community organizer with ACORN.  Stanley Kurtz, a scholar and writer, is a senior fellow with the Ethics and Public Policy Center in Washington DC.  He writes about Obama’s dangerous connections:

What exactly does a “community organizer” do? Barack Obama’s rise has left many Americans asking themselves that question.  Here’s a big part of the answer: Community organizers intimidate banks into making high-risk loans to customers with poor credit.

In the name of fairness to minorities, community organizers occupy private offices, chant inside bank lobbies, and confront executives at their homes — and thereby force financial institutions to direct hundreds of millions of dollars in mortgages to low-credit customers.

In other words, community organizers help to undermine the US economy by pushing the banking system into a sinkhole of bad loans. And Obama has spent years training and funding the organizers who do it.

The seeds of today’s financial meltdown lie in the Community Reinvestment Act — a law passed in 1977 and made riskier by unwise amendments and regulatory rulings in later decades.

CRA was meant to encourage banks to make loans to high-risk borrowers, often minorities living in unstable neighborhoods.  That has provided an opening to radical groups like ACORN to abuse the law by forcing banks to make hundreds of millions of dollars in “subprime” loans to often uncreditworthy poor and minority customers.

ACORN has been at the center of vote-tampering schemes in past elections.  It drew national attention in 2004 when its get-out-the-vote activists were implicated in many reports of voter fraud, particularly in swing states like Ohio, Missouri, Pennsylvania, New Mexico, Colorado Minnesota and Washington.

ACORN has worked closely with corrupt labor unions and its tactics resemble those of labor racketeers. An unusually large number of its critics describe the organization as a cult, demanding fanatical devotion from members, while exploiting their good will.  ACORN actually sued California in 1995, arguing that ACORN should be exempted from state minimum-wage laws.  Which seems particularly crass since ACORN’s mission is to enact “living wage ” ordinances. Discover the Networks has an excellent run-down on ACORN activities and agendas.

Stanley Kurtz goes on to describe Obama’s worrisome connection to ACORN:

It would be tough to find an “on the ground” community organizer more closely tied to the subprime-mortgage fiasco than Madeline Talbott.  And no one has been more supportive of Madeline Talbott than Barack Obama….

In those years , he also conducted leadership-training seminars for ACORN’s up-and-coming organizers.  That is, Obama was training the army of ACORN organizers who participated in Madeline Talbott’s drive against Chicago’s banks.

More than that, Obama was funding them.  As he rose to a leadership role at Chicago’s Woods Fund, he became the most powerful voice on the foundation’s board for supporting ACORN and other community organizers.  In 1995, the Woods Fund substantially expanded its funding of community organizers — and Obama chaired the committee that urged and managed the shift…

The Woods Fund report makes it clear Obama was fully aware of the intimidation tactics used by ACORN’s Madeline Talbott in her pioneering efforts to force banks to suspend their usual credit standards. Yet he supported Talbott in every conceivable way.  He trained her personal staff and other aspiring ACORN leaders, he consulted with her extensively, and he arranged a major boost in foundation funding for her efforts….

In short to understand the roots of the subprime-mortgage crisis, look to ACORN’s Madeline Talbott.  And to see how Talbott was able to work her mischief, look to Barack Obama.

To find out what community organizers really do, read the whole thing.  It will show you why it would be beyond the pale for a federally funded bailout for this mortgage crisis to include funding for the group that contributed so much to creating the crisis.

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