February 2, 2009

More on the Community Reinvestment Act as a selective filter

A reader responds to my new VDARE.com article on the subtle but pervasive way in which the Community Reinvestment Act changed the culture of mortgage lending in America.

... my husband was working at [Famous Old] Bank at that time and was dealing with the pressures of CRA mandates during merger talks with other banks. He saw the kinds of promises [Famous Old Bank] had to make to get approval and he actually had to work with bullies at ACORN to get the job done. As I am much more to the right and more aware than he was, I pointed out that this would eventually skew the banking system in a very corrupt and unprofitable ways just to go along with the new government rules. As a banker, he just saw what he had to do to accomplish the ends.

This is like a car that can only go straight or turn left, not right. You'd initially think that if you could drive it straight down a highway no problem, but each little random shock aims it farther to the left with no way to go back to the right. And so it eventually ends up in the ditch on the left. (Interestingly, to get the banks out of the ditich, the federal government ignored the CRA process last fall in approving emergency buy-ups of broke banks.)
Ultimately, the failure of the banking system can be narrowed down to one set of core beliefs that nearly everyone in our society ascribes to: all groups are equal. There is no reason for them to believe, despite the mounds and mounds of evidence, that this premise is fatally flawed. So the Carter, Bush, Clinton, and Bush administrations operating under this false premise with near religious certainty saw no problem in pushing the banks in the direction of lending to peoples and groups who could or would not conform to the standard values of this society. This religious belief in the equality of groups is still enshrined in our value system. I don't know what it will take to change this -- but rest assured it will result in greater calamities ...

You can see how the CRA, along so much else, filters the culture. By wielding a veto over bank acquisitions, it announces, "You can lend money, invest, and give away money as you see fit, as long as you want to be the hunted, not the hunter in the mergers & acquisition game." Combine that with the constant patter of discrimination lawsuits where any mention coming up in discovery of bank executives mentioning the different default rates of the races would likely lead to an instant settlement, and, combined with the education and media systems, you can see how we bred an entire generation of Kool-Aid drinkers.
Meanwhile, the capitalist were "doing well by doing good", the government could further their social engineering objectives, and the masses of Americans were kept in ignorance by a vile and corrupt media, even though they are left holding the bill and will pay the price for a fallen America.

Thanks for writing about these important subjects. It seems as if very few people have the knowledge and ability to do so (or the courage).

My published articles are archived at iSteve.com -- Steve Sailer

12 comments:

Anonymous said...

CRA-type pressure on banks pushed them to make bad loans to "non-minorities" as well as favored minorities.

You have written, Steve, about how abolishing the Federal civil service exam(s) because they could not simultaneously predict job performance and select desired proportions of minority applicants made government hiring less effective (and probably more corrupt) even when considering non-minority applicants. We see something similar other government hiring-- e.g., forbidden to use written tests which make minorities look bad, local police departments hire illiterate whites as well as blacks.

Well, with banks and mortgage brokers competing for borrowers, lowering credit standards for favored minorities meant lowering them for non-minorities as well.

Because of this effect, we can blame CRA-type interference for all kinds of bad loans, whether they were given to favored minorities or not.

Anonymous said...

This religious belief in the equality of groups is still enshrined in our value system. I don't know what it will take to change this -- but rest assured it will result in greater calamities ...

Yes and we all know that the religious belief that some groups are not equal to others will lead us all to paradise.
See quote below

Alexander Stephens, the vice president of the Confederacy, in his famous Cornerstone Speech stated "Our new government is founded upon exactly the opposite idea; its foundations are laid, its cornerstone rests, upon the great truth that the Negro is not equal to the white man; that slavery -- subordination to the superior race -- is his natural and normal condition," he said.

Anonymous said...

Steve Sailer: You can see how the CRA, along so much else, filters the culture. By wielding a veto over bank acquisitions, it announces, "You can lend money, invest, and give away money as you see fit, as long as you want to be the hunted, not the hunter in the mergers & acquisition game."

Is this the part where we get to mention Herb & Marion Sandler?

Video available here:

http://www.snlbailout.cx/

http://www.snlbailout.cx/edit.html

Anonymous said...

If one wants to be really paranoid and identify the results of the mortgage meltdown with its original purpose, one might reason thus: The pressure on banks to seek higher minority lending goals led to many junk loans and artificially increased housing demand, thus accelerating the early housing bubble.

Both bubble and bad loans got a booster shot with pressure on Fannie and Freddie to enter this market aggressively and worsen the situation in 2005 and 2006. The bubble began to deflate in 2007, slowing the economy and leading to discontent with the Republican Administration.

The bubble then burst completely in 2008, shortly before an election. This conferred office on the party that has a quasi-religious commitment to using the powers of government to coerce racial parity of results, in banking and other sectors. This can only be done by socializing, in some fashion or another by spending or regulation, American society and the American economy.

This result looks a lot like the objective, achieved by non-violent means, of many 19th Century and early 20th Century Marxist terrorists. Simply by creating intolerable chaos that the established government cannot control or explain, the terrorists can take power. It has all been peaceful, of course. It was done by powerful men in suits, rather than badly dressed lowlifes with bombs. The political victims collaborated with their adversaries in preparing their own ruin. The financial sector abetted it, through greed and folly, rather than intent. So most of it was surely not as deliberate, especially early on, as paranoia implies. But the consequences sure look similar.

When terrorism succeeds, none dare call it terrorism?

Anonymous said...

Zoolbia wrote:

You have written, Steve, about how abolishing the Federal civil service exam(s) because they could not simultaneously predict job performance and select desired proportions of minority applicants made government hiring less effective...

How long till all testing disappears? Bar exams, medical license exams, RN license exam, the SAT and GRE, the CPA exam, engineering licenses - they're all extremely un-PC. Most of the plumbers, elevator mechanics, unionized plasterers, etc. here in NYC are white. Why? Professional licenses. Surely, the blue collar certifications will be the first ones to go. I'm going to guess that the bar exams will hold out the longest and that most of the others will disappear within the lifetimes of most of us.

Anonymous said...

Yeah, but the real damage to the economy is a result of white guys (really smart ones) taking all these bad loans, splitting them into thousands of little pieces, and selling them to other white guys (not so smart ones) as CDOs and derivatives, and once it dawned upon the market that they couldn't *really* figure out what they were worth -- boom. That's what caused the exponential calamity that's threatened the world financial system, not the 10% default rate on the original mortgages.

Behind every great Empire their is a great crime (or a white guy)

Anonymous said...

the real damage to the economy is a result of white guys (really smart ones) taking all these bad loans[...] and selling them to other white guys (not so smart ones) as CDOs and derivatives[...]Behind every great Empire their [sic] is a great crime (or a white guy)

Or a Jewish guy.

But seriously, can you blame the victim? If laws were loaded on you demanding that you loosen lending standards for ne'er-do-wells of all colors and stripes (because, well, kumbayah!), what are you to do short of quitting and becoming a truck driver? (Not a bad choice at that.)

The endgame of "blame the victim" is accusing of murder a mother in a dictatorship who is forced at gunpoint to "choose" which of her children will be shot by the secret police...she could tell the secret police all she knows, or pick a child, or die and know ALL her children will die.

Our mortgage situation is not as quite as dire as that, but the principle applies. It isn't whiteness per se that drove it into the ground. Most white guys involved were acting under forms of duress (i.e. rules which would not arise or last in a free market).

The drivers were the instigators of the CRA - and of the modern-dress Kumbayah ethos that gave it Mom-and-apple-pie status. You would have to trace the evil back to Franz Boaz, SJ Gould, and a few Congress critters. The rest were acting under systemic coercion (with any self-delusion on their part being only a psychological coping mechanism).

I theorize some flavor of the following, thus: A forced B to do the dirty in the name of helping C.

Anonymous said...

I'm going to guess that the bar exams will hold out the longest and that most of the others will disappear within the lifetimes of most of us.

Indeed. And how many lawyers come here on visas? Why couldn't an American law school offer classes in India? That's when the lawyers will start to join our side.

Anonymous said...

"(Interestingly, to get the banks out of the ditich, the federal government ignored the CRA process last fall in approving emergency buy-ups of broke banks.)"

This is typical liberal behaviour. When the chips are down they can do the most outrageous things, also w.r.t. race, and not blink an eye. Their premise is that the end justifies the means. Period. And they refuse to see the irony of that attitude.

Anonymous said...

"This religious belief in the equality of groups is still enshrined in our value system. I don't know what it will take to change this -- but rest assured it will result in greater calamities ..."

You cannot change it. The outcome is a tribal structure like Zimbabwe where the country is mostly dysfunctional except for the top 4000 and their extended families. The rest just get f.ed. Whites are badly placed at this game which is primarily ethnically based since whites are individuals and have little group cohesion. The playscript has not only been written, it has been performed once in Rhodesia, and is currently running in South Africa. Next show: USA.

Anonymous said...

"How long till all testing disappears? Bar exams, medical license exams, RN license exam, the SAT and GRE, the CPA exam, engineering licenses - they're all extremely un-PC."

In South Africa the government has junked Engineering certification. Because it hurts blacks. So when you go shopping, or drive over a bridge, you better hope the right guy designed it.

Anonymous said...

"This religious belief in the equality of groups is still enshrined in our value system. I don't know what it will take to change this -- but rest assured it will result in greater calamities ..."

I agree 100%.

"Yes and we all know that the religious belief that some groups are not equal to others will lead us all to paradise."

You make the typical mistake of assuming that the only alternative to PC Egalitarianism is slavery, white supremacism, etc.