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Obama, ACORN, and the Financial Crisis

October 8, 2008

OneNewsNow

by Marcia Segelstein

How did we get into this financial mess in the first place? Well, to a large degree, it’s because lenders gave mortgages to borrowers who were unqualified, who shouldn’t have been given loans in the first place. Why did they do that?

Here’s the start of an article in the ‘Chicago Sun-Times’ from April 1995: “You’ve got only a couple thousand bucks in the bank. Your job pays you dog-food wages. Your credit history has been bent, stapled, and mutilated. You declared bankruptcy in 1989. Don’t despire: You can still buy a house.” That article then suggested that people wanting to buy homes who fit this profile go see a group called ACORN.

Obama at the time had his hands on the purse strings of two organizations. He was a director of the Woods Fund, and he was Chairman of the Board of the Chicago Annenberg Challenge (CAC). He gave money from both organizations to ACORN, and also provided training for ACORN workers.

According to Stanley Kurtz of National Review Online, “ACORN succeeded in drawing Fannie Mae and Freddie Mac into the very policies that led to the current disaster.” ACORN put pressure on banks by threatening them with accusations of racism if they didn’t give loans to minorities, even if they were completely unqualified.

Starting in 1987, ACORN began pressuring Fannie Mae and Freddie Mac to lower their standards for assuming mortage debt. And eventually they succeeded. By 1995, then President Clinton touted the fact that home-ownership in America was at an all-time high. According to Kurtz, ACORN representatives were guests of honor at this ceremony. (Note to McCain campaign: can you dig up that footage??)

But as Kurtz goes on: “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…In fact, however, ACORN is at the base of the whole mess…And Barack Obama cut his teeth as an organizer and politician backing up ACORN’s economic madness every step of the way.”

The McCain campaign needs to go after Obama’s support of ACORN and its direct role in the current financial meltdown.

They could start by reading the entire Kurtz NRO piece here. Then maybe they should put Sarah Palin on the case.

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2 comments

  1. You know, I have to tell you, I really enjoy this blog and the insight from everyone who participates. I find it to be refreshing and very informative. I wish there were more blogs like it. Anyway, I felt it was about time I posted, Ive spent most of my time here just lurking and reading, but today for some reason I just felt compelled to say this.


  2. Funny thing is. Most of these mortgages would have been fine if INFLATION hadn’t sky rocketed. That along with the Deregulation of companies that allowed them to ship jobs over seas with no fear of facing import taxes on their products, even though they in effect become foreign traders. Which of course the Republicans favored the deregulations. These two factors had more influence on whether the people could afford the mortgages considering you state that in ’95 the home owner rate was up, and it wasn’t until ’08 when these Mortgages became “bad”. But lets not mention these factors, that makes the Republicans look bad. That isn’t the job of this web site. This website is and ANTI-Democrat website. So lets do what Republicans do best. SHIFT THE BLAME.



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