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financial meltdown (3)

Rajjpuut's Folly: Dear Treasury Secretary Timothy Geithner,

Posted by Bob VanDeHey on July 14, 2011 at 5:00pm

 

Note: After finding his website (treasury.gov/) to be totally user-unfriendly and being unable to communicate the following information with our Treasury Secretary, Rajjpuut left a link to his Townhall.com blogsite and printed this blog    . . . .

 
 
21 Facts You Presumably Know (#1-21 with #19 referring directly to the actions of Treasury Secretary Timothy Geithner)
 
7 Facts You May Not Be Aware of (A-G with letter G referring directly to the actions of Treasury Secretary Timothy Geithner)
 
The obvious conclusions . . . .
 
21 Facts You Presumably Know
 
  1. In 1975 the United States had by far the highest private home ownership in the world with 64%.  Besides newcomers to the workforce, college students, the young and the scarcely-educated, virtually every American with gumption could own** their own home after a few years of renting. 

  2.  In 1975 the “suspect” home loan rate stood at roughly 0.24% or only about one in every 404 loans. Before 1977, the usual and customary down payment had long been 20%. These suspect loans granted at 3% down payment or less were not only exceedingly rare, they were typically granted to veterans with jobs and great credit working their way through college under the GI Bill.

 
  1. In 1985 the suspect home loan rate had risen to roughly 0.51% or about one in every 196 home loans. Something small had changed . . . . What?
 
  1. In 1995 the suspect home loan rate was roughly 14% or about one in every seven home loans. Something big had changed . . . . What?
 
  1. By 2005, just two years before the financial meltdown, about the time of widespread PUBLIC realization that sub-prime home loans were causing huge problems: the suspect home loan rate was roughly 34% or more than one in every three home loans. Something enormous had changed . . . . What?
 
  1. Between item #2 and item #3 above, in 1977 two things had changed. The Community Reinvestment Act was passed in 1977 (CRA ’77) by the Carter administration and Democrat’s House and Senate. For the first time in history home loan lenders were forced to knowingly make bad loans to unqualified would-be home buyers. 
 
  1. Wade Rathke, a lieutenant of George Wiley, (more on this later) in 1977 with the passing of CRA ’77 created the Arkansas Community Organizations for Reform Now (ACORN) which was a “test organization” (more on this later) with two commandments from Wiley, Richard Cloward, and his wife Frances Piven (more on all of them later) in 1975, following up on this TRIO’s expressed desiderata for their followers to expand their endeavors (more on this later) into 1. Voter registration and 2. Home lending. Arkansas was chosen because of the existence in that small state of an up-and-coming young politician (the lieutenant governor elected in 1976, Bill Clinton) and his wife were very compatible with the TRIO’s politics.
 
  1. Between item #3 and item #4 above, in 1977 six major things had changed. ACORN had been approved of and expanded to all 50 states. The ACORN acronym had been switched to a new meaning: Association of Community Organizations for Reform Now. Voter registration activities which had elected their candidate in Arkansas were now expanded to the entire country; and their overload-the-CRA ’77-law campaign that had already doubled the suspect loan rate of the whole nation just by their efforts in Arkansas was likewise a nation-wide campaign.
 
 
  1. Bill Clinton, the ACORN candidate, had been elected governor of Arkansas for 12 of the next 14 years.
 
  1. Clinton had become the ACORN president in 1992.
 
  1. President George H. W. Bush who prevailed on 45 of his 46 vetoes did not veto a big bill he was largely in favor of. His veto was needed for a small part of that bill which added in an expansion of CRA ’77 to federal mortgage agencies Freddy Mac and Fanny Mae.
 
  1. President Clinton used his Presidential powers to expand CRA ’77 in 1993 by huge regulatory fiat.
 
  1. President Clinton out-maneuvered the Republican Congress and got CRA law expanded twice during 1995. By the way, President Barack Obama was an ACORN lawyer for two years before and after this time, browbeating home mortgage companies and banks into making knowingly unwise loans to undeserving unqualified home loan applicants. He was known for also getting ACORN contributions simultaneously.
 
  1. Between items #4 and #5 only one major change took place in CRA ’77 but it was huge! Bill Clinton was now popular again and he was able to get a steroid version^^ of CRA ’77 passed in 1998.
 
  1. The changes after the CRA steroid version was passed in 1998 were no longer just quantitative but hugely QUALITATIVE as well. To wit:
 
  1.  
    1. It became easier for ACORN to push for $440,000 homes after 2000 then it had been to seek $110,000 homes in 1990.
    2. Not having a job; having only food stamps to declare as “income” and having horrific credit ratings were no longer a problem in buying very expensive homes.
    3. Across the Southwestern United States even illegal aliens were able to get CRA-guaranteed treatment from ACORN.
    4. Many of these CRA loans were now being made to EVEN LESS qualified loan applicants than before. A large percentage of these loans were now granted at 0% down payment.
    5. To repeat, by 2005, suspect home loans had risen to 34% of all home loans.
 
  1. In November, 2003 James Stack of Investech.com began running a chart of the Housing Industry Bubble in stocks within the home-building and financial industry and discussing the danger to the economy from the sub-prime lending crisis. The Stack Housing Industry Bubble showed a 1400% increase. Housing prices had been booming for well over a decade.
 
  1. By early January, 2005 (less than 14 months later), the Bush administration had become seriously concerned about this problem. Their bill to repeal virtually all the most dangerous provisions of CRA legislation was defeated by Congressional Democrats.
 
  1. Bush would make a total of 19 speeches about the sub-prime lending process and seek to change CRA legislation for the next 30 months. Finally, in July, 2007 a full two years and a half after the Bush administration had begun trying to change CRA law, a very weak bi-partisan bill was passed by the Congress. 
 
  1. That new law would prove to be way too little, way too late . . . but it would definitely help avoid much of the worst potential consequences of the sub-prime lending crisis. While the Obama administration was passing on the lie about Bush, conservatives, and the free market causing the financial meltdown (“driving the car into the ditch”), one honest and thinking man within the administration, Treasury Secretary Timothy Geithner recognized the truth and spoke it. In mid-2010, Geithner praised Bush for his efforts and eventual success in passing the July, 2007, anti-CRA law. Geithner said that Bush’s actions prevented a decline into a much worse recession and especially for an all-out plummeting of home prices.
 
  1. As mentioned the new law helped but proved too little, too late to turn things totally around . . . and the financial meltdown hit us hard.
 
  1. On at least 206 occasions, President Obama has used the “car (economy) in the ditch” metaphor implying that he and the Democrats and especially the Progressives within both parties had nothing to do with the problem. This is a lie. For 34+ years the Progressive laws have violated the free markets and forced low-down payment and no-down payment loans which must be granted to totally Undeserving and Unqualified home loan applicants.
 
 
7 Facts You May Not Be Aware of
 
A.              Following the “War on Poverty” and “Great Society” initiatives of the Lyndon Johnson administration, in mid-1966, Richard Cloward and Frances Piven, two neo-Marxist sociology professors from New York’s Columbia University who admitted being inspired by the Watts Riots and the writings of Saul Alinsky, published an article in The Nation magazine entitled The Weight of the Poor: a Strategy for Ending Poverty. The article suggested that by “overloading” the nation’s newly expanded welfare system and using poor citizens as storm troopers . . . a financial crisis could be brought about forcing the then-dominant Democratic party to see that a GNI (Guaranteed National Income) law be passed and thus POOF! In one fell swoop ending poverty. This “overload the system and create orchestrated chaos” plan has been much discussed by the left-wing and become known as “Cloward-Piven Strategy” or “C-P Strategy.” The suggested Saul Alinsky tactics within this strategy included “street theater" demonstrations and “making them live up to their playbook.” 
B.                              In 1967 Cloward and Piven and a Black militant Marxist, George Wiley, created the NWRO (National Welfare Rights Organization) to put C-P Strategy to work. They were able to put four million new recipients onto the New York State welfare rolls and almost double that many onto the nation’s welfare rolls between 1968 and 1970. A huge number of these additional welfare people lived in New York City.
C.                              Between 1968 and 1975 the NWRO had placed over eight million new welfare recipients on the rolls in New York State and almost sixteen million new people onto the rolls. A virtual two year long recession from early 1973 to January 1975 hit the stock market with its biggest losses since the Great Depression. In 1975 NYC went bankrupt and was bailed out by the federal government. New York State teetered upon the edge of bankruptcy.
D.                              Even though a GNI was never seriously considered in Congress, Cloward and Piven and Wiley declared “victory” in numerous speaking engagements and in print. They advised their followers to move into voter registration and housing. Wiley’s lieutenant Wade Rathke (who’d been sent to Arkansas in 1970 by the NWRO) had been assigned the task of creating a C-P strategy for a future campaign. Between President Carter; the Democratic Congress in 1977 and Wade Rathke’s creation of ACORN in Arkansas that task was successfully completed. 
E.                              In 1993, shortly after being elected to his first term, President Bill Clinton oversaw the creation of the Motor Voter Bill (called by many “a superhighway to voter fraud). ACORN which had been pushing for loosened standards of proof for voters for 16 years was represented at the signing ceremony by Richard Cloward and Frances Piven standing directly behind his desk while he signed the new law.
 
F.                             Corruption was rampant, Democratic leaders like Barney Frank and especially Fanny Mae head Franklin Raines (who it's believed personally profited over $150 million from the scandal) maintained over and over throughout the period from 2004 to 2007 while speaking about Fanny Mae and Freddy Mac that these were solid investments for the public. Anyone who dared to point out the dangers was castigated and demagogued as a racist or non-patriotic person.  Today more than three million potential new foreclosures are about to be added to the housing market. Even one foreclosure in a neighborhood can devastate the local home values. Fanny’s and Freddy’s future is still very much in the air.G.                             Only one honest voice has come out discussing about 1% of this very serious and critical matter: Timothy Geithner.
 
The obvious conclusions . . . .
 
          The truth about these matters is not only of great financial import but also critical to the awareness of the American voters. It is clearly no exaggeration to say that the nation’s security is in play. The truth is needed, what trusted source will reveal it?   I pray, sir, that honest source will be you . . . .
 
 
Sincerely,
Bob VanDeHey
Centennial, CO   80122
 
Ya'all live long, strong and ornery,
Rajjpuut
 
** Just exactly what is so wrong with renting homes and apartments^^ anyway?   What tiny percentage of today's college students,  other young people, high school dropouts and other scarcely-educated people, (the people who typically have bad credit, no credit or are inexperienced) and the people without jobs earning themselves at least $40,000 yearly or more can be counted upon to pay off ANY mortgage loans they'd be given? 

    If they can't put down even 10% down payment, what are the chances they'll ever actually own their own homes rather than the bank owning it?  The whole CRA thing was a huge Ponzi scheme based upon the idea that housing prices NEVER go down . . . which is patent nonsense.  Of course IF housing prices NEVER go down, then these people who are getting home loans which objectively they do NOT deserve will indeed make a profit . . . so this is a share-the-wealth project as well.  But, of course, no investment grows to heaven . . . home prices routinely drop, that is reality.  Renting is a time-honored tradition of the young, of students, of low educated people.  Many of them end up owning a home later . . . but once the government prohibited free market loan evaluations, everything becomes irreparably corrupted.
 
^^  Another way to look at this is that CRA legislation was class warfare against the upwardly mobile middle-class.  These are the people who invest in rental properties.  If no one rents what happens to these people?  What happens to upward mobility?  What happens to the American Dream?  This is the classic "Broken Windown Fallacy" where this category of taxpayers is made "invisible" so that they can be abused to the benefit of people who do not pay taxes.  This brief link says it all . . . .
 
 
 
   

Tags: CRA '77, Timothy Geithner, financial meltdown, open letter, progressives, progressivism, sub-prime lending crisis


 
 
  
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Rajjpuut's Folly: Expensive, INeffective Pet Obama Housing Program Repealed

Posted by Bob VanDeHey on April 3, 2011 at 4:05pm

 

“There are lies, damn lies, statistics . . . and then there are damnable statistical lies from politicians.” 
Rajjpuut
 
“When you combine ignorance and borrowed money, the results can get interesting.” 
Warren Buffet
 
 
 
Wide-spread Housing Collapse Underway
Main Obama Program Fails, ‘Cash for Keys’ Proposed
 
 
NOTE:  CBS Moneywatch today, ran an article entitled “Why the Housing Market is three times worse than you think.” Since Rajjpuut has several times mentioned that when it comes to housing, the situation is probably seven or eight times worse than the administration wants people to believe, it’s time to clear the air.   This blog concerns HAMP and other failed big government housing initiatives and how they’ve destroyed the U.S. housing market now and possibly well into the future. Many American readers know very little about the background of the situation which is provided in the next few paragraphs. If you’re well-informed, skip the introduction and head right down to the “red” paragraph below and start reading there . . . if you’ve foolishly been thinking over the years that politics and the economy don’t matter – don’t affect you, read and understand every word and continue to the footnotes and read and understand that as well. As the Kingston Trio once sang, “Citizens, hear me out, this could happen to you!”
            As every would-be bride knows, it’s “something old, something new, something borrowed, something blue" . . . and yes, a similar pattern is starting to develop. The “old” is the outdated Keynesian idea that government can create real and meaningful jobs in free markets and that government interference could actually save free markets in times of duress; can improve the free market system. 
The “new” under Obama was a series of handouts and bailouts bearing his signature ‘zero oversight, zero results’ label . . . first came the Obama $787 billion second-stimulus.  Then “Cash for Clunkers” in mid-2009 proved itself an expensive program that accomplished little or nothing and absolutely destroyed the used car market so badly that’s its effects are still in place today: the average used car today costs $1,778 more than an average used car cost in 2009, hurting poorer Americans more than all others. Then came HomeStar, unofficially known as “Cash for Caulkers,” launched later that same year to encourage economic growth by offering incentives to homeowner and retailers and small business owners for improving their homes’ etc.’s energy efficiency.  The program got all tied up in bureaucratic red tape when Republican oversight indicated that the beneficiaries would mostly tend to come from a narrow-range of construction firms that had contributed to the Obama presidential run in 2008. “Cash for Keys” (more below) is a similar program which has an importantly distinct “wrinkle.”
“Something borrowed” includes all the same lies that made Franklin Roosevelt (FDR) such a left-wing hero even though he took an ordinary recession and extended it out to 12.5 years until Pearl Harbor finally jump-started the economy and ended the country’s horrific malaise. In this age of real information available in real-time, however, the slick lies that allowed FDR to confiscate the nation’s gold coinage from citizens and then to re-peg the price of an ounce of gold from $20.76 up to $35 an ounce (a theft of the wealth of the citizens and an overnight inflation of roughly 69% which mugged 92% of all Americans <gold coin holders> on the one hand; and then impoverished 100% of the nation on the other) aren’t able to fester so long as there are now in the information age watchdogs like The Wall Street Journal and Fox News (and to a lesser extent USA Today) defying the liberal media’s cheerleading for the Obama administration and holding their feet to the fire every single day; 24 hours a day.  Even though most citizens don't bother to educate themselves as to political reality; the 24-7 news cycle makes it impossible eventually for the majority to stay ignorant forever.  When they "wise up" often their bitterness toward the liars in government can be dramatic:  as we saw on the last Election Day.
Under real media scrutiny, Joe Biden’s remarkable rhetorical statement (“Are we going to have to borrow trillions, to keep from going bankrupt? Yes!”) was quickly revealed for the preposterous notion it was and not repeated.  When a poll earlier this week showed that 60% of Americans do NOT approve of Obama’s economic programs and then virtually identical results came from the always trustworthy Rasmussen Reports, it shows that Americans sooner or later get the picture.   Only 36% of Americans think the Obama economic programs are sound.  57% are so convinced that they're in favor of a government shutdown so long as substantial budget cuts result.
Something “blue” is the result of all the government interference in the once great American housing market. We’ll only touch briefly here on the well-documented fact that it was government interference** which created the crisis in the first place (see the footnote if you’ve been too busy watching sitcoms and IRreality shows to notice how the government stuck it to us . . . and pay attention from now on). We will mention that the job-killing government interference that supposedly was designed to expand job opportunities in the free market has had the exact opposite effect. The money that normally would sit on the sidelines during the initial stages of a recession and then come into play has stayed there on the sidelines for two and a half years now. The bottom of the recession, as shown by the American stock markets which usually get it close to right, was in mid-March, 2009 six months after the height of the financial crisis. Typically in normal times within another nine or ten months (that would mean at the end of 2009 or January of 2010) an all-out recovery is well underway. 
However, thanks to all the new government regulation and interference and all the confusion and uncertainty that’s been created . . . even larger amounts of capital has stayed uninvested by small business, the engine of economic recovery. This is money that would have been working in the free markets for fourteen or fifteen months already which is too frightened by the economic assault Barack has lain upon them. Obamacare, is one of the administration’s worst moves ever. The new law all by itself created 384 new government agencies (in 12+ years FDR only created 39 new agencies) – no, that is NOT a typo, 384 new agencies and all their red tape anti-business bureaucracy Americans now have to deal with. Now let us move on to something’s “double-blue.”
On Tuesday, March 29th, the House of Representatives voted overwhelmingly to end HAMP one of president Obama’s most ambitious housing programs. HAMP (the Home Affordable Modification Program) was designed to keep homeowners in their homes despite being on the road to foreclosure for not paying their mortgages. Republicans and virtually all so-called “Blue-dog” Democrats agree nearly 100% that HAMP was a fiasco, a monumental failure. There are lies, damn lies, statistics . . . and then there are damnable statistical lies from politicians . . . such as when Janet Napolitano tells us with contrived data that the borders are safer than ever; or President Obama assures us that his approach to the housing approach is actually working quite well; and justifying his request to modify and expand the program . . . .
“Real” (meaningful numerical information designed to highlight a problem and point at a solution) statistics tell a different story than the Obama folk would have you believe. As soon as the repeal HAMP bill was passed in the House, fifty Democratic reps sent a message to Treasury Secretary Tim Geithner urging that he reform HAMP: “HAMP must change to meet its potential.” The real stats show a deeply flawed program. Besides the few Blue-dog Dems voting for the bill, most Democrats know that HAMP is the poster boy for failed government interference and government spending boondoggles, but they feel they must vote with their caucus and their president . . . so the HAMP repeal vote faces a highly uncertain future in the senate . . . not to mention that Barack Obama has said he will definitely veto the HAMP repeal bill should it reach the Oval Office.     What is it about HAMP that Democrats find to love? First, the facts . . . .
The outgoing special investigator general for TARP (the Troubled Asset Relief Program), Neil Barofsky, called HAMP a "failure," in an interview with CNN on March 24th. He said HAMP was supposed to help 3 to 4 million underwater homeowners stay in their homes. But so far, it has only managed to help less than half a million do so despite immense expenditures of time and money.   "It's really one of the deep failures of TARP," Barofsky said. "TARP wasn't supposed to just help the banks return to profitability, it was also supposed to help people stay in their homes." Mr. Geithner at the Treasury has pointed out, on several occasions, that while the HAMP program could be better, it's the only federal program spurring mortgage servicers to help homeowners. 
What goes unmentioned among all the administration spin is that because of the huge amount of time and red-tape involved with HAMP and the refusal of many aggrieved foreclosed owners to leave their properties the possibility of a genuine recovery in the American housing market is years away. Until these depressed properties are handled, their shadow hangs over all potential dealings as the vast majority of Americans paying their mortgages every month find that their once “most valuable asset” (their home) has now become a monstrous drag on their personal finances. Should they want to sell, they face depressed prices and/or long periods of uncertainty before a buyer can be found. If they hold onto their homes they face 3%-10% drops in value that threaten in many cases to put them “underwater” on their mortgage despite their homes’ built-up equities. 
Barack Obama’s refusal to insist that reasonable foreclosures be allowed to proceed is a huge black cloud hanging over the nation’s real estate marketing. Of course, Barack as an ACORN lawyer in the mid-90’s was helping shake down lenders and setting up a lot of these very same loans to ignorant and unworthy clients by extorting banks to abide with the federal government’s CRA ’77 legislation forcing them to make horrifically bad home loans so perhaps his judgment in the matter is clouded. Besides clearing this nebulous situation up, the Republican HAMP repeal bill will knock $1.3 billion off the federal deficits. So why does Obama and why do the progressives Democrats love HAMP? Despite all their claims about Bush and “the car in the ditch,” most Democrats know who really caused the financial meltdown we saw beginning in late 2007. They’d prefer, however, to continue to lie to themselves and to the American voter.  
HAMP is their last ditch effort to prove to themselves that despite the obvious facts on display . . . government interference works; that they really did NOT undermine and cut the legs off the U.S. economy with all their constant mortgage industry interference beginning with CRA ’77 (see the earlier mentioned footnote** below). Of course the fact that the original CRA President was Jimmy Carter; and our first ACORN president Bill Clinton, expanded Community Reinvestment ACT ‘77 legislation once by regulatory fiat in 1993; twice by separate legislations in 1995; and by a steroid-version expansion of the law in 1998; and the fact that Barack Obama was an ACORN lawyer for parts of three years shaking down banks and mortgage companies to extort their involvement in CRA 77 and grant knowingly unsound loans to knowingly terribly fiscally-unworthy clients . . . these facts should not color your evaluation of progressive politicians and their competence now, should it?
So what is the big picture here? What’s going on in the housing markets? When can we expect a full recovery? Recent reports show that new home sales hit a record low in February, 2011. Last week we found out that 19 of the 20 largest metros areas according to Standard and Poors, experienced a pricing slump in January. This is horrible news three years into the financial meltdown and almost by itself guarantees a “double-dip” recession. Ah, but the situation degenerates even more . . . .
The good news is that besides some job growth and a tiny wage growth . . . American banks are finally looking at the economy with a rosier perspective and are now far more likely to grant home loans.   However, the fly-in-the-ointment is the nasty situation with depressed and foreclosed homes mentioned above. It’s what the mortgage industry calls “shadow inventory.” Besides the alarming backlog of older homes on the market and the relative DEPRESSION in new home turnover, there is this nagging shadow inventory that can’t be dealt with properly because of the government red tape; Obama’s intransigent belief that his programs are infallible; and Eric Holder’s “INJUSTICE DEPARTMENT” standing in the way, protecting the unworthy ACORN-inspired borrowers over the forced-to-loan-‘em-money-by-your-stupid-CRA ’77-law banks and handcuffing the entire U.S. economy as a result.
Here’s what the statistics tell us: A) 3.5 million existing homes are being tracked by the National Association of Realtors (NAR) which, at their current prices, are homes that would sell on average only after 8.5 – 9 full months’ exposure on the market. B) The “shadow inventory” that the government and the banking industry would like to pretend isn’t fouling their nets is, if you press them, another 1.8 million homes definitely likely to hit the market sometime soon in our futures. Why? Some people will eventually “just walk away” from their underwater mortgages; or from their job losses which have made them unable to continue paying on older homes in which they’ve some real equity; most of these people are now anywhere from three months to nine months behind in paying their mortgages and foreclosure is now a definite prospect. And what is the likely result of all this shadow inventory eventually? A large chunk of these homes will appear on the market and the NAR’s projected nine month turnaround will then jump to an average of two years . . . a literal disaster for home-sellers and C) in reality the biggest lie of our time concerning the mortgage industry is now coming to light: it appears that a hither-to unreported severely underwater shadow inventory has been glossed over until now. 
These are two million homeowners who now find themselves at least 50 percent underwater on their mortgages. A huge percentage of these folk were the “beneficiaries” of the CRA ’77 legislation and ACORN’s efforts to put the jobless and poor credit risks and even illegal aliens into expensive homes (that statement is zero exaggeration, but LITERALLY 100% true). A leftist rebellion has charged many of these folks with a zeal for ignoring the facts of life and staying in their homes (despite years of not paying their mortgages in many cases) despite the official proceedings. To say that this element is a severe drag on the housing market is to underestimate reality by 600% in Rajjpuut’s opinion. IF they are allowed to get away with this the banks are really in trouble. IF they get away with this, what’s also to stop normal, honest debtors who can afford their mortgages but who find themselves underwater from saying “Screw it? I like their idea!” What would prevent that? This sort of widespread collapse of private property would mean the end of America as we know it.
Rather than facing reality, the Obama administration is looking at creating another government-spending and government-interference boondoggle called “Cash for Keys.” Their idea is to give $21,000 to all the bad loan recipients from CRA ’77 so they’ll vacate their homes and the housing market can finally start to return to normalcy. So the progressives in the federal government almost bankrupted the banks and mortgage companies by forcing them to make horrifically bad loans to those people (many of whom could not honestly afford an $800 used car) and after bailing out the banks, they’re going to bailout these fools who couldn’t figure that there was no way in hell they could ever pay off their home loans . . . . Now do you still believe in making government bigger? What do you think of government-forced redistribution of wealth schemes now?
For the home-sellers in the worst-hit states: (New Jersey, Illinois, Maryland, Florida, Delaware, Georgia, Connecticut, Alabama, California and Washington) those turnover numbers are beginning to drag out already. Only four states seem to have a semi-healthy housing industry outlook for 2011-2012: the aforementioned North Dakota, Alaska, Wyoming and Montana. Sugar-coating all this information is the Obama strategy to get him through the next nineteen months and re-elected . . . excess sugar is terrible for your health.
As a quick side note: if you’re in the market for a home, present mortgage rates are very much on your side, so take your time, look over the available housing carefully; don’t be afraid to offer 50%-60% of asking price. After initial refusal you might find a bargain home in five or six weeks. If you’re selling a home, make sure you live in North Dakota, Alaska, Wyoming or Montana; or look to hold onto it for 8-10 years when the markets might hopefully rebound and stabilize at a higher level. Of course, if we wind up with hyper-inflation in the next decade, your home and its present ridiculously high mortgage might just prove to be your saving grace if you can survive the ravages of 80% or higher inflation. Good luck, America!
 
Ya’all live long, strong and ornery,
Rajjpuut
 
** “When you combine ignorance and borrowed money, the results can get interesting.” Warren Buffet                  Buffet’s comment not only applies to the unworthy and ignorant borrowers (perhaps worthy of a 55% down payment loan for an inexpensive home if they won a lesser part of the lottery some day, but definitely NOT worthy of a 0.0% loan on a $400,000 home) blogged about here . . . but also to the ignorant and heavily mortgaged Federal Government. Are you far better off now, than you were $5 TRillion ago? I’m not and neither is the country. How did we get into this mess? It’s a long but very interesting story . . . .
 
ITEM:  In 1975, 64% of American private citizens owned their own homes, then the highest in the world. Only one loan in 404 was considered “suspect.” 90% of home loans were granted with 20% to 33% down payment. Even the “suspect” loans were special cases, typically military officers attending college on the GI bill who received mortgages in some cases with 3% down payment. In short our private home ownership mortgage system was NOT broken. But progressive politicians of both parties would soon fix that, and us.
 
 
A decade earlier, a progressive president, Lyndon Baines Johnson, not only got us deeply involved in war in South East Asia, but also launched an expensive “War on Poverty” which included Medicare and the Federal side of Medicaid that today face a combined $68 TRillion in unfunded liabilities; a broad expansion of Social Security benefits (now with $36 TRillion in unfunded liabilities); and a sweeping and, of course, overly generous and anti-work-incentivized welfare set of expansions. About the time this was happening, a husband and wife neo-Marxist team, Richard Andrew Cloward and Frances Fox Piven, published an article in The Nation magazine in 1966 entitled The Weight of the Poor: a Strategy to End Poverty which has come to be popularly known as the “Cloward-Piven Strategy;” the two were Columbia University professors not opposed to crapping in their own nest (New York City) as you’ll soon see. In C-P Strategy the poor are unwittingly used as leftist storm troopers in their attempt to bankrupt the federal government of the United States. 
Their stated goal -- when they established the National Welfare Rights Organization (NWRO) in 1967 with Black militant activist George Wiley – was to bankrupt the welfare system by creating a huge welfare state and thus to cause such financial chaos they’d get the Democratic Party to institute a Guaranteed National Income (GNI). This approach they said would SNAP! eliminate poverty; totally destabilize American capitalism; and set the country on the fast lane to “the Revolution.” Frances Piven, by the way, is still alive and still calling for “The Revolution” and violence and blood in the streets today. Rajjpuut bets “Nana Frannie” makes a wonderful peachy-keen grandmother – wanna bet she knits some wonderful Afghans?
Their Alinsky street-battling worked wonders in the welfare offices (self-proclaimed “neo-Marxist Saul Alinsky is famous for Reveille for Radicals in 1946; and Rules for Radical in 1971 he also was a mentor to Hillary Clinton and his “Rules for Radicals” course was taught in Chicago by Professor Barack Obama) and C-P strategy worked “wonderfully,” welfare rolls were doubled within three and a half years and by 1975, New York City was bankrupt; New York State itself was on the verge of bankruptcy and numerous large metropolitan areas and big-city states around the country were also in dire fiscal straits. NYC was bailed out by the federal government in November that year. 
Wiley and Cloward and Piven took to publically boasting of the “great things they’d accomplished” even though their stated goal (GNI) was never an idea discussed seriously in Congress;” then they called upon their followers (using the “Saul Alinsky street tactics” Wiley had perfected for future endeavors) to now get involved in federal housing and in voter registration. Therein hangs the meat of our tale . . . .
ITEM: As new president Jimmy Carter took office in January, 1977, a Wiley-NWRO lieutenant sent to Arkansas about 1970, Wade Rathke, was assigned the task of coming up with a Cloward and Piven type organization along the lines of the NWRO to test out in Arkansas. Arkansas was chosen because it was far from the “media glare” and because they had an up-and-coming young politician whose thinking ran to progressive aims that C and P and Wiley strongly believed in: Bill Clinton, at 30 years old one of the youngest Lieutenant Governors in the country and one of the nation’s most promising Democrats. 
                The stimulus for the Rathke assignment was that Carter and the Democrats had promised CRA ’77- (Community Reinvestment Act of 1977) type legislation designed to spread the wealth by forcing mortgage companies to make home loans to bad risk clients (at that time just in the inner cities) who, as they saw it, might otherwise not be in the housing market for ten or twelve years. Perhaps 4% of Americans understand the whole big picture of Cloward and Piven and of Carter’s CRA ’77 legislation and how it led inexorably to the financial meltdown of 2007. It’s a fascinating story. But first consider this: it took Cloward and Piven’s NWRO parts of eight years to bankrupt NYC and nearly bankrupt New York State and with Bill Clinton’s unending support, it took ACORN roughly 30 years to bring down the USA and almost ruin it irreparably. 
ACORN (originally the Arkansas Community Organizations for Reform Now) was created at virtually the same moment as Carter’s CRA ’77 law was signed. At first ACORN was largely ineffective in getting housing action but they went out almost immediately and began registering voters for the 1978 Arkansas election. They signed an enormous bunch of people up; many of them were even real people really eligible to vote in Arkansas. They also threw all the Republican registrants paperwork in the trash which threw the 1978 election dramatically to William Jefferson Clinton, the state’s new governor. At that time Arkansas governors were only elected to two-year terms, later that changed. Nevertheless with ACORN’s backing Bill Clinton remained Arkansas governor for 12 of the next 14 years and became president of the United States in 1992. Meanwhile ACORN had figured out how to get lots of bad home loans for risky clients. In a little while, ACORN was found in all 50 states and now stood for: Association of Community Organizations for Reform Now.  By 1985, the action of ACORN limited only to Arkansas had made a big difference in overall mortgages in the entire United States. The number of suspect loans was roughly doubled: from 1 in every 404 in 1975, to 1 in 196 by 1985.
ITEM:  The election of Bill Clinton in 1992 was a welcome relief for progressives after the fiasco that was Jimmy Carter in 1980; and the non-electables Walter Mondale in 1984 and Michael Dukakis in 1988. Even though Clinton made the CRA ’77 situation much worse, it would be unfair to give Democrats all the blame. About 80% of Democrats were progressives in the early 1990’s but progressive Republicans played a role every step of the way and, even a non-vigilant conservative president caused us a lot of problems. George H. W. Bush who succeeded in upholding 45 out of 46 presidential vetoes against a big-spending congress saw a bill pass his desk that he approved of except for two or three small details. Instead of standing his ground, Bush #1 signed the bill into law instead of vetoing it and sending it back to Congress for removal of the offending parts. Too bad, part of that bill was an expansion of CRA mortgage legislation into the big federal mortgage programs Fanny Mae and Freddy Mac -- a huge mistake. The good thing was that the original CRA ’77 was a poorly constructed law that mostly any conscientious mortgage company could largely ignore.
                Bill Clinton came into office in January, 1993 aiming to put across a very ambitious conservative agenda including government health care. He was beholden to ACORN and to all the Cloward-Piven people and more importantly he largely believed as they did. His first two major actions were aimed at re-paying them.   You’ll recall that ACORN was created in response to the C-P call for their supporters to get involved in voter registration and in federal housing after their success in bankrupting NYC . . . Clinton passed the “Motor Voter Act” called by opponents “a twelve-lane highway to voter fraud.” No doubt the ACORN people considered Motor Voter to be a great help to their registrations scams. If you’ll visit this picture of the Motor Voter signing ceremony you’ll see something very important in the picture:
Yes, if you visited the Wikipedia link given earlier you’re right, that is Frances Fox Piven in the green sweater standing almost directly behind President Clinton with her husband Richard Cloward the tall man with glasses to her immediate left watching the Motor Voter Act get signed into law.
                Clinton also used the regulatory fiat of his office to turn the rather cumbersome CRA ’77 legislation into a powerful and more easily enforceable law. Now it would not be so easy for mortgage lenders to laugh off the notion of making bad loans to unqualified would-be home buyers . . . now it would become part of their everyday life. Twice in the year 1995, Clinton was able to sneak bills further expanding CRA ’77 through Congress even though it was dominated by Republican majorities in the House and Senate. Newt Gingrich the Speaker of the House did a horrible job and allowed almost anything the Democrats could dream of into numerous “compromise bills.” During this time a Chicago attorney named Barack Obama was working for ACORN and shaking down home loan companies. Obama was reputed to be so good at his job that court appearances never happened. The Banks just caved in, agreed to a certain pattern of loans and usually even offered up a donation to ACORN thanks to Barack’s persuasiveness. By 1995, one in every seven home loans was suspect and also offered at less than 3% down payment.
Finally, in 1998 Clinton passed the steroid version of CRA ’77 in 1998. Obama was long gone but the ’98 Clinton expansion of CRA put ACORN in the driver seat. From now on they’d have less trouble getting unqualified loan recipients into $440,000 homes than they had getting them into $110,000 homes a decade earlier. ACORN had elevated its shake-down processes into a science. Where before loans for moderately bad risks had been common, the new law made it easy for ACORN to get home loans for people without jobs; people with bad credit ratings; people without even rental histories; people whose only “income” was food stamps; or other welfare roll recipients; and even illegal aliens. By 2005, 1 in every 3 home loans (34% to be precise) was granted to unqualified loan recipients at 3% down payment or less . . . many of them at 0% down. The housing bubble was accelerating and America was in trouble.
Perhaps the first person to write about the seriousness of the bubble was investech.com guru James Stack out of Whitefish, Montana. As early as late November, 2003, Stack was upon the problem like ugly on an ape. He soon began including a graph of the Housing Industry bubble which he said had been created by senseless sub-prime loans that could never be expected to be repaid. That graph slowly changing month after month was a regular part of the investech weekly reports for roughly the next 5 ½ years. The Republicans of the Bush #2 administration figured things out by late December, 2004 and presented Congress with a bill undoing the 1998 Clinton expansion and many of the most harmful features of all the CRA ’77 legislation. President Bush gave nineteen separate speeches about the unraveling of the American economy that CRA ’77 was bringing about. The bill was defeated every time and the liberal press virtually totally ignored the story. Rajjpuut, who had been warning people since December, 2003 was aghast. Here was the most serious financial debacle of our time and no one cared. 
Finally, 30 months after their first try, the Republicans passed a seriously watered-down version of the anti-CRA ’77 bill in July, 2007 just about the time the problem became Unignorable. It was, of course too little, too late. Nevertheless, according to a speech Treasury Secretary Timothy Geithner made in August, 2010, Bush’s efforts probably saved the nation from absolute financial Armageddon and he credits Bush in particular for preventing a total meltdown in housing prices. So as far as that little fable Mr. Obama delights in about the Republicans, conservatives and Wall Street driving the economy in the ditch . . . the truth is quite different. Here it is:
George W. Bush seeing the progressives, Bill Clinton, Barack Obama and most Democrats deliberately pushing the car (the economy) toward a 500 foot-cliff,  jumped into the front seat grabbed the steering wheel and hit the brakes and guided it into the nearest friendly-looking ditch.  Amen.
 
It's that key word "deliberately" that is most disturbing on two levels:  first, that one of our major parties has been hijacked by people (progressives) who put their own agenda totally and utterly ahead of the nation's because they know best for all of us; and secondly, the fact that only two main news sources in the country have considered this story important enough to cover.  Just in case you don't know what progressivism is:  it's the conviction that we must "progress" beyond the 'outdated and ill-conceived U.S. Constitution' if we are to make necessary "progress" toward an earthly Utopia.
 
 
Read more…

Rajjpuut's Folly: Big Lies Doom Country to False Future

Posted by Bob VanDeHey on November 28, 2010 at 3:30pm
Every time the matter of extending Bush’s personal tax breaks on all Americans and extending the “death taxes” and keeping business taxes low . . . every time these matters are mentioned, the progressive Democrats in power in the House, Senate and Oval Office hit us with some version of the following lies and their corollaries. For example:
#1 Bush’s economic policies created (via the Wall Street mess) our present financial malaise . . . we need to go in another direction.
#2 Republicans have made a big deal out of rising deficits and rising national debt and yet they’re intent on dropping taxes on millionaires that would add $700 Billion to the deficit.
#3 Conservatives in general and Republicans, in particular, and the free market have failed us once again and government had to save the day . . . so why give them another chance to screw us up?
#4 Those Bush tax cuts have been around for nearly a decade and they didn’t do any good, quite the contrary.#5 They put our car into the ditch and yet they want the keys returned; we’d be foolish to give them back because they don’t know how to drive.
We will deal with these lies shortly, explaining why they are false and what the actual truth is . . . for now it’s important to realize that once a lie or other misperception has been disseminated by political liars, it tends to take hold (and sometimes take on a life of its own) unless it’s immediately challenged and proven false. The longer it goes unchallenged, the more entrenched the lie** becomes.
Both Goebbels and Hitler gave credit to people like Walter Winchell, Edward Bernays, and George Creel; and especially to America’s Wilson administration for creating the science of propaganda which the Nazis would later use to such powerful effect. Even as early as 1924, Hitler, in Mein Kampf, mentioned the power of the “Big Lie” to completely dominate political debate.
Isn’t it finally time we got to the full truth?
How did it start, this domination of lies over truth in Americans’ understanding of the national political debate? The end game for all propaganda is to change the historical record into something favorable to your side and to control public opinion. Today’s progressives (the name “progressive” was dropped after Woodrow Wilson left office and the label “liberal” remained the self-definition of choice for the leftist politicians for roughly 86 years thereafter) would have Americans believe that they, the progressives, have invented and created America’s greatness over the objections of more fiscally-conservative and Constitutionally-conservative Americans. Literally, they would have you believe that they dragged the country kicking and screaming into the modern era.
Progressives would also claim that they were the ones advocating racial equality all along. The Democratic Party was the party of slavery in the Pre-Civil War days and the party of Jim Crow in the South. Wilson himself was a racist. He’s the one who stopped Blacks being hired by the federal government in Washington, D.C.; and even as president of Princeton University did everything in his power to discourage Black attendance there. The premier of D.W. Griffith’s racist masterpiece “Birth of a Nation” took place in the White House with Wilson presiding over the ceremonious affair. Wilson personally authored a dramatically revisionist interpretation of American history and severe criticism of the Constitution (The New Freedom) calling for progressivism to save the country. Progressives (those who believe, “we must ‘progress’ beyond the outdated and ill-conceived U.S. Constitution” and who emphasize making ‘progress’ toward bringing about some version of earthly Utopia) have reaffirmed the Wilson era name for themselves today and shown much more openness in their connection to socialism and even Marxism, more on that later . . . for now let’s address those five Big Lies.
Big Lie #1 “Bush’s economic policies created (via the Wall Street mess) our present financial malaise . . . we need to go in another direction.” Talking about the “Wall Street Mess” is like talking about the top three feet of the huge iceberg that the Titanic ran into and claiming that all the damage was done by that top yard of snow. What did cause 98% of the damage to America’s economy in 2007 and beyond? In 1975 the United States had a home-loan system almost totally run by the private sector. Ownership of homes by private citizens averaged over 64% we were the envy of the world. At that time only one in every 404 loans was offered at 3% down payment or less (usually to former military officers attending college) 0.24% of all home mortgages. Mortgage default was almost unknown. In 1977, President Jimmy Carter and his progressive Democrats controlling both chambers of Congress passed the Community Reinvestment Act (CRA ’77) to fix a situation that was NOT broken. The impetus of the new law was to force mortgage lenders to make bad loans. The percentage of potentially risky home loans in the 28 years following CRA ’77 rose by 13,800% and to make the situation worse 1) in 2005, 34% of all home loans were granted at 3% down payment or less and many of them were granted at an unheard of 0% down payment while 2) ACORN and others pushing for these loans after Bill Clinton’s 1998’s steroid version expansion of CRA ’77 found it as easy to move poor people without credit into $400,000-$500,000 homes as it had been to move more qualified poor people into $60,000 homes in the 1980s. In other words, 98% of the financial meltdown was caused by government interference in the mortgage markets created by progressive politicians giving us the sub-prime lending crisis.
As far as the “Wall Street Debacle” documented by The Big Short author Michael Lewis and others . . . yes, that was created by Wall Street greed exploiting the policies of the Federal Reserve Bank which had allowed “derivative” investments to be sold. Fed Chief Alan Greenspan once hailed derivatives as “the savior of the financial markets, practically guaranteeing that financial collapses are impossible. The creator of the Federal Reserve and the inflation that has dominated American policies over the last century (the dollar today is worth nine pennies compared to the dollar of 100 years ago): President Woodrow Wilson, who also gave us the income tax and government propaganda. So let’s give Wall Street greed 0.5% of the blame; Alan Greenspan 0.5% of the blame and progressive politicians 98% + 1% = 99% of the guilt. Nevertheless, they have enthusiastically been blaming everyone but themselves.
Big Lie #2 says, “Republicans have made a big deal out of rising deficits and rising national debt and yet they’re intent on dropping taxes on millionaires that would add $700 Billion to the deficit.” First note that the deficit mentioned is $700 Billion over ten years . . . unsaid is that the combined policies of Nancy Pelosi over four years and Barack Obama over two years have swelled the national debt by roughly $5 Trillion, that is seven times the $700 Billion mention in far less time with almost no Republican help. Secondly, the Keynesian economists in the White House are infamous for pie-in-the-sky arithmetic when projecting the effects of their ruinous policies but using zero-sum ideas to evaluate conservative ideas. In this case, there is no mention of the probable GREAT DEPRESSION #2 that their tax hike on the small business community will create (the top 2% of the tax-paying populace creates 70% of all new jobs); or of the stimulus to job creation and economic recovery that will swell the government’s tax coffers via extension of the Bush cuts to those top 2%. And, of course, there are also all those bad loans forced upon mortgage lenders by CRA ’77 (and all the extensions to it over the last 33 years) providing a huge drag on the economy and on government revenues also contributing to the deficits.
As for Big Lie #3 which says “Conservatives in general and Republicans, in particular, and the free market have failed us once again and government had to save the day, again . . . so why give them another chance to screw us up?” This is specifically the Barney Frank lie repeated early and often while he assured us that our mortgage system in general and Fannie Mae and Freddie Mac in particular were on completely sound footing. 1) First of all, Barney Frank and folks like Chris Dodd totally failed in their key oversight roles; they failed to see the problem coming which their policies had created and exacerbated. And let’s emphasize the fact that the problem was not subtle and hidden from view. James Stack of Investech.com first mentioned the sub-prime lending crisis in November, 2003 and declared that the economy was in a very vulnerable state accompanying his “Housing Industry Bubble Chart” for an unheard of five consecutive years on the website. 2) George W. Bush and his administration brought the matter to the country’s attention in January, 2005, fourteen months later. Bush called for new legislation wiping out the worst aspects of CRA ’77 legislation and the expansions that followed (four by Bill Clinton – three legislatively in ’98 with two others in ’95; and a wide-sweeping regulatory expansion in 1993) that had created the sub-prime lending crisis. Bush’s efforts failed but he would speak to Congress on eighteen more occasions to emphasize the problems that the sub-prime lending expansion had brought to the country. However, numerous savage refutations by Frank and Dodd and the entire Democratic leadership kept future attempts from bearing fruit. Finally in July, 2007, thirty months after Bush first brought the matter to Congress’s attention, a very late, very weak and very limited version of Bush’s January, 2005 effort was passed.
Of course it proved way too little, way too late and the meltdown began in October, 2007. However, Bush’s effort was credited and praised in August, 2010, by Obama Treasury Secretary Timothy Geithner with preventing a serious plunge in home prices and a worse and absolutely devastating recession.
Remember, Barney Frank said, “. . . the free markets and Wall Street got us into trouble, again, and the government had to come to their rescue, again . . .” the facts show however that the truth instead is that the economy was weakened devastatingly because of CRA’77’s effect over thirty years and that as early as 2005 34% of all mortgage lending were potentially suspect forced loans legislated upon lenders and the ensuing bubble in home prices; and the ensuing bubble in housing industry stocks proved to be full of hot air and nothing else as everything collapsed.
Big Lie #4 says that the Bush tax cuts have been around for nearly a decade and rather than helping out, they sabotaged us and helped bring about our present financial crisis. The truth about this lie will be discussed as part of the discussion of Big Lie #5. For now, the general truth is that the tax cuts did a helluva lot of good, but you can’t feel secure in believing that without a lot of background facts. Let’s get to it!
Big Lie #5 says, “They (conservatives and Republicans and the free markets) put our car (the American economy) into the ditch (deep recession) and yet now they want the keys returned, we’d be foolish to give them back because they don’t know how to drive.” 1) The progressive Democrats don’t decide who “gets the keys and runs the country,” the American voters do and the voters instinctively know things are not exactly as the Democratic Party claims they are . . . and the recent ringing rejection of the policies of Obama and the Democratically-controlled House and Senate in this November’s elections confirmed their distrust . . . but we can do much better than relying on “instinct” 2) We’ve already shown that 98% of the problem can be attributed directly to 30+ years of serious big government interference boondoggling. 3) We’ve also shown that in January, 2005 Bush called for undoing the poisonous CRA ’77 laws and then continued to call for it almost 20 times until a weak anti-CRA law was passed. The progressive Democrats not only created and exacerbated the problem; they also provided thirty months of obstruction to fixing the problem and their obstruction also resulted in a weaker and later law to fight the problem.
In short: the truths are these: A) Big Lie #4 is corrected by saying that in all likelihood the Bush Tax Cuts fueled the economy and made the CRA problem much less serious than it other wise would be and B) Big Lie #5 is corrected with this stunning statement:
George W. Bush saw the progressive Democrats, Bill Clinton, Barack Obama and especially ACORN pushing the car (the economy) toward a 500-foot ditch and jumped into the front seat grabbing the wheel and slamming on the brakes to guide the car into the nearest friendly-looking ditch.
That italicized statement is so outrageous that we must in decency provide more research evidence to back it up: it’s a bit of a long story but we’ll seek to boil it down for you . . . but first, let’s really get outrageous, let’s add a single italicized word to that statement . . . the word “deliberately” so now the statement reads this far more outrageous way:
George W. Bush saw the progressive Democrats, Bill Clinton, Barack Obama and especially ACORN DELIBERATELY pushing the car (the economy) toward a 500-foot ditch and jumped into the front seat grabbing the wheel and slamming on the brakes to guide the car into the nearest friendly-looking ditch.
Can that be proven? YES, YES, YES! Here are the facts . . . .
In 1975, the State of New York just missed going bankrupt; New York City, however, was bankrupt and had to be bailed out by the federal government. What was the cause of their fiscal debacle? Eight million new recipients were added to the welfare rolls between 1968 and 1975 by the DELIBERATELY-planned actions of Richard Cloward, Frances Piven and George Wiley. There’s that word “DELIBERATELY” once again. It all began with the publication of an article by the Columbia University (NYC) progressive professors Cloward and Piven titled The Weight of the Poor: A Strategy to End Poverty in the May 2, 1966 edition of the leftist publication “The Nation” which came to be known as “Cloward-Piven Strategy.” Their idea: use Alinsky tactics (named after self-described Neo-Marxist Chicago community organizer Saul Alinsky author of Rules for Radicals) to overload the welfare rolls, creating a fiscal crisis and forcing (they thought) the Democratic Party to pass a GNI (guaranteed national income) in keeping with president Lyndon Johnsons “War on Poverty.” How were those new welfare recipients created? Browbeating tactics, demonstrations and outright refusal to stand up to them by the nation’s social workers . . . courtesy of the National Welfare RIGHTS Organization run by Wiley in concert with Cloward and Piven. The threesome did not get their GNI but nevertheless bragged publicly and in writing about their great “success” after the NYC bankruptcy. Cloward and Piven called upon their supporters to move their Alinsky techniques into the areas of voter registration and housing for the future. Wade Rathke, a Wiley lieutenant sent to Arkansas to run that state’s NWRO efforts in 1970, was already in place.
The future was NOT far off. The Carter administration and progressives passed CRA law and in that same year, 1977, the Arkansas Community Organization for Reform Now (ACORN) was created. We could write whole encyclopedia about ACORN’s fraudulent voter registration techniques but we’ll only mention that the supposedly non-partisan group gathered a huge number of voter registration forms in 1978 and destroyed all those belonging to would-be Republican voters. The positioning of Rathke was truly fortuitous. In 1976, Arkansas elected a 30-year old up-and-comer as their Lieutenant Governor and it was his campaign for Governor in 1978 that the fraudulent ACORN efforts benefitted. Bill Clinton was elected to the Arkansas Governorship 12 of the next 14 years and would become the first ACORN president in 1992. Meanwhile ACORN had expanded across the nation and its acronym now stood for Association of Community Organizations for Reform Now but still claiming non-partisanship and still into voter fraud as well as housing. Thanks almost entirely to ACORN’s brow-beating and shake-down tactics in Arkansas, nationwide the percentage of suspect loans doubled between 1975 and 1985 to a still reasonable 0.51%.
ACORN had delivered for Bill Clinton and now as President he showed himself willing to repay in kind. 1) In his very first year he unleashed the ACORN beast. In an infamous photo found all over the internet, Clinton signs the Motor Voter Act with Cloward and Piven standing directly behind him during the ceremony. 2) Unable to get CRA legislation, Clinton uses Presidential directive to get widespread regulatory expansion for CRA ’77. Then in 1995, Clinton out-maneuvered Newt Gingrich into allowing two minor expansions of the CRA ’77 law. By now ACORN is national and pushing for bad loans all across the country. By the end of 1995, 14% of all home loans in America are suspect and the housing bubble and housing industry bubble are fully underway.
In 1998, Clinton delivered for ACORN once again. The ’98 expansion of CRA laws put the whole ugly system on steroids. ACORN from now on will find it EASIER to get poor people with zilch credit scores into $400,000-$500,000 homes than they’d faced getting better qualified individuals into homes costing 80% less just a decade earlier. The upshot? Home lenders were forced by their government to make knowingly disastrous loans to people . . . .
a) without jobs
b) with poor credit ratings
c) without even a documented rental history
d) with only food stamps as “income”
e) with lifelong histories on Welfare
f) and even to illegal aliens
So now by 2005, 34% of all home loans were suspect loans and the debacle was clearly underway. One little detail you’ll appreciate: Barack Obama was a Chicago community organizer who worked parts of 1994-1996 as an ACORN lawyer shaking down banks and other mortgage lenders to force them to make bad loans. Obama’s signature skill was avoiding the courtroom and not only securing the home loans in question, but also was getting the lenders to make donations directly to ACORN. So let’s let you, the reader consider that word we’ve used twice: “DELIBERATELY” . . . .
So let us all contemplate the impact of those five Big Lies on our nation. On Election Day a message was sent. However, we still have the architects of the disaster running the show: Obama, Pelosi, Reid, and Barney Frank are still bigwigs in Congress. Chris Dodd was replaced by his clone Richard Blumenthal. And the 80% progressive control of the House Democratic caucus before the election now stands at 90% control by the progressive Democrats even though as a Party they lost 65 seats in the House and six seats in the senate. The people who DELIBERATELY set out to undermine our great nation are still in control of our most powerful political party and still out to “fundamentally transform” and destroy America as we know it. Vigilance and continued grassroots action by an informed and angered citizenry is the only hope. Indeed, if the contents of this article were generally known by 80% of the populace, it's hard to imagine progressive action being regarded as benignly and tolerantly as it now is . . . .
Ya’ll live long, strong and ornery,
Rajjpuut
**More details for truly ambitious readers can be found here:
http://sweetness-light.com/archive/the-many-tentacles-of-cloward-piven
I've reproduced much of that internet article here:
Inspired by the August 1965 riots in the black district of Watts in Los Angeles (which erupted after police had used batons to subdue a black man suspected of drunk driving), activists were abuzz over the so-called "crisis strategy" or "Cloward-Piven Strategy," as it came to be called. Many were eager to put it into effect.
In their 1966 article, "The Weight of the Poor: A Strategy to End Poverty" (which sold an unheard of 30,000 reprints) Cloward and Piven charged that the ruling classes used welfare to weaken the poor; and that by providing a social safety net, the rich doused the fires of rebellion. Poor people can advance only when "the rest of society is afraid of them," Cloward told The New York Times on September 27, 1970. Rather than placating the poor with government hand-outs, wrote Cloward and Piven, activists should work to sabotage and destroy the welfare system; the collapse of the welfare state would ignite a political and financial crisis that would rock the nation; poor people would rise in revolt; only then would "the rest of society" accept their demands.
The key to sparking this rebellion would be to expose the inadequacy of the welfare state. Cloward-Piven’s early promoters cited radical organizer Saul Alinsky as their inspiration. "Make the enemy live up to their (sic) own book of rules," Alinsky wrote in his 1972 book Rules for Radicals. When pressed to honor every word of every law and statute, every Judaeo-Christian moral tenet, and every implicit promise of the liberal social contract, human agencies inevitably fall short. The system’s failure to "live up" to its rule book can then be used to discredit it altogether, and to replace the capitalist "rule book" with a socialist one.
The authors noted that the number of Americans subsisting on welfare — about 8 million, at the time — probably represented less than half the number who were technically eligible for full benefits. They proposed a "massive drive to recruit the poor onto the welfare rolls." Cloward and Piven calculated that persuading even a fraction of potential welfare recipients to demand their entitlements would bankrupt the system. The result, they predicted, would be "a profound financial and political crisis" that would unleash "powerful forces … for major economic reform at the national level." They would in eight years double the number on welfare via the NWRO’s bullying tactics.
Their article called for "cadres of aggressive organizers" to use "demonstrations to create a climate of militancy." Intimidated by threats of black violence, politicians would appeal to the federal government for help. Carefully orchestrated media campaigns, carried out by friendly, leftwing journalists, would float the idea of "a federal program of income redistribution," in the form of a guaranteed living income for all — working and non-working people alike. Local officials would clutch at this idea like drowning men to a lifeline. They would apply pressure on Washington to implement it. With every major city erupting into chaos, Washington would have to act. This was an example of what are commonly called Trojan Horse movements — mass movements whose outward purpose seems to be providing material help to the downtrodden, but whose real objective is to draft poor people into service as revolutionary foot soldiers; to mobilize poor people en masse to overwhelm government agencies with a flood of demands beyond the capacity of those agencies to meet. The flood of demands was calculated to break the budget, jam the bureaucratic gears into gridlock, and bring the system crashing down. Fear, turmoil, violence and economic collapse would accompany such a breakdown — providing perfect conditions for fostering radical change. That was the theory.
Cloward and Piven recruited a militant black organizer named George Wiley to lead their new movement. In the summer of 1967, Wiley founded the National Welfare Rights Organization (NWRO). His tactics closely followed the recommendations set out in Cloward and Piven’s article. His followers invaded welfare offices across the United States — often violently — bullying social workers and loudly demanding every penny to which the law "entitled" them. By 1969, NWRO claimed a dues-paying membership of 22,500 families, with 523 chapters across the nation.
Regarding Wiley’s tactics, The New York Times commented on September 27, 1970, "There have been sit-ins in legislative chambers, including a United States Senate committee hearing, mass demonstrations of several thousand welfare recipients, school boycotts, picket lines, mounted police, tear gas, arrests – and, on occasion, rock-throwing, smashed glass doors, overturned desks, scattered papers and ripped-out phones."These methods proved effective. "The flooding succeeded beyond Wiley’s wildest dreams," writes Sol Stern in the City Journal. "From 1965 to 1974, the number of single-parent households on welfare soared from 4.3 million to 10.8 million, despite mostly flush economic times. By the early 1970s, one person was on the welfare rolls in New York City for every two working in the city’s private economy." As a direct result of its massive welfare spending, New York City was forced to declare bankruptcy in 1975. The entire state of New York nearly went down with it. The Cloward-Piven strategy had proved its effectiveness.
The Cloward-Piven strategy depended on surprise. Once society recovered from the initial shock, the backlash began. New York’s welfare crisis horrified America, giving rise to a reform movement which culminated in "the end of welfare as we know it" — the 1996 Personal Responsibility and Work Opportunity Reconciliation Act, which imposed time limits on federal welfare, along with strict eligibility and work requirements. Both Cloward and Piven attended the White House signing of the bill as guests of President Clinton.
Most Americans to this day have never heard of Cloward and Piven. But New York City Mayor Rudolph Giuliani attempted to expose them in the late 1990s. As his drive for welfare reform gained momentum, Giuliani accused the militant scholars by name, citing their 1966 manifesto as evidence that they had engaged in deliberate economic sabotage. "This wasn’t an accident," Giuliani charged in a 1997 speech. "It wasn’t an atmospheric thing, it wasn’t supernatural. This is the result of policies and programs designed to have the maximum number of people get on welfare."
Cloward and Piven never again revealed their intentions as candidly as they had in their 1966 article. Even so, their activism in subsequent years continued to rely on the tactic of overloading the system. When the public caught on to their welfare scheme, Cloward and Piven simply moved on, applying pressure to other sectors of the bureaucracy, wherever they detected weakness.
In 1982, partisans of the Cloward-Piven strategy founded a new "voting rights movement," which purported to take up the unfinished work of the Voting Rights Act of 1965. Like ACORN, the organization that spear-headed this campaign, the new "voting rights" movement was led by veterans of George Wiley’s welfare rights crusade. Its flagship organizations were Project Vote and Human SERVE, both founded in 1982. Project Vote is an ACORN front group, launched by former NWRO organizer and ACORN co-founder Zach Polett. Human SERVE was founded by Richard A. Cloward and Frances Fox Piven, along with a former NWRO organizer named Hulbert James.
All three of these organizations — ACORN, Project Vote and Human SERVE — set to work lobbying energetically for the so-called Motor-Voter law, which Bill Clinton ultimately signed in 1993. The Motor-Voter bill is largely responsible for swamping the voter rolls with "dead wood" — invalid registrations signed in the name of deceased, ineligible or non-existent people — thus opening the door to the unprecedented levels of voter fraud and "voter disenfranchisement" claims that followed in subsequent elections. The new "voting rights" coalition combines mass voter registration drives — typically featuring high levels of fraud — with systematic intimidation of election officials in the form of frivolous lawsuits, unfounded charges of "racism" and "disenfranchisement," and "direct action" (street protests, violent or otherwise). Just as they swamped America’s welfare offices in the 1960s, Cloward-Piven devotees now seek to overwhelm the nation’s understaffed and poorly policed electoral system. Their tactics set the stage for the Florida recount crisis of 2000, and have introduced a level of fear, tension and foreboding to U.S. elections heretofore encountered mainly in Third World countries. Both the Living Wage and Voting Rights movements today depend heavily on financial support from George Soros’s Open Society Institute and his "Shadow Party," through whose support the Cloward-Piven strategy continues to provide a blueprint for some of the Left’s most ambitious campaigns.
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