'Know nothing'

Published 10/14/08

I am offended and disgusted by the premise that social engineers, otherwise known as community organizers, created our financial crisis by directing mortgage loans to low credit minorities. Our country has engaged in a culture of reckless spending with plenty of blame to go around. Subprime lending was a symptom of many problems, not the least of which was poor congressional oversight of the banking industry.

Diane West must be an economic know nothing whose opinions are formed mostly by ideology and prejudice. Where did Ms. West get the notion that lending to poor people is inherently risky? Why didn't she address the notion that rich people have a greater ability to recklessly borrow much larger sums of money? What place does racism even have in this discussion?

NANCY PASHBY

Odenton

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The economic mess........ - 2008-10-29 22:59:46

It would be nice to have people stop blaming the democratic congress for the economic problems. 
From 2001 through 2006, the republicans had a chokehold on the government, Congress, the senate, and the presidency. And even after the 2006 elections, the democrats were almost powerless because it takes a super-majority of 60 senate votes to bring legislation to a vote up or down. Since the Dems had only 50 or 51 votes, the republicans could stop anything they wanted to stop. And stop they did, with 94 filibusters, a record.

But the republicans pals on wall street understood this issue very well, and it meant they could come up with newer and more complex 'Enron like' schemes to fake the value of what was sold and traded on the street. 
And fake they did, with deals leveraged 50 to 1, five times worse then what collapsed to bring on the great Hoover Republican depression of 1929......

So the mortgage mess, with 2-3 million people facing foreclosure is just the tip of the iceberg we have hit. It is the Trillions of $$ that have disappeared in these schemes, that is the issue. Money that we and our children will be paying for a decade to unravel this mess. 
And McCain voted for Bush's policies 90-95% of the time. Nice guy.
Of course he, with his second wife own 7 or 8 homes worth 13 million $$. Along with a private Jet plane. And his second wife - he cheated on his first to Marry Cindy - She has an estimated $200 MILLION forture.

What, me worry, is and will be the attitude of Sen McCain, Just like the rest of the Bush republicans.

And it would be so nice if the republicans on this blog would stop blaming the victims of the mortgage crisis for causing it. it is the oldest, and cruelest trick in the world.

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Stephen Kay - Severna Park, MD - Karma: Bad

Democrats caused it. - 2008-10-22 20:33:53

But Bush is being blamed. Look up Jimmy Carter, Barney Frank etc. on this mess. FORCING banks to lend money to neer-do-wells under penalty of Law. And what is the Capital Gazette's take on this? I'd guess more Mamby-Pamby B.S. about 'Plenty of blame to go around'. Editor?

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E. Giles - West River, MD - Karma: Neutral

As to the author - 2008-10-22 11:22:41

Obviously the author of this editorial has missed the definition of what subprime is. These are less-than-ideal loans to individuals with less-than-ideal credit, which obviously, translates into a riskier loan.

Can you please tell me if you had a choice to lend 100k to someone with a 700 beacon score and made 70k/year vs. someone with a 580 beacon score and made 28k/year, who would you choose?

Now if you, the borrower, decide not to take the loan, can the bank come after you legally? No. However, if a bank decides not to lend you money, can you go after them...absolutely; which was the case forcing lenders to loosen their standards.

Was congressional oversight partly responsible...yes. Its funny when the Dems took over Congress in '05 we were fine. It only took them a year to do the damage. Everyone wants to blame Bush but I hate to say, congress is the one that drafts legislation, not the President. We really should be holding them responsible for being asleep at the wheel.

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Johnathan Locke - Edgewater, MD - Karma: Good

Debbie - 2008-10-22 11:10:35

I whole-heartedly agree with you. I detest how this whole mess has turned into a blame game (welcome to politics I guess). Why are we failing to hold the homeowners that took out these insane loans accountable is beyond me. Oh yeah, because then we wouldn't be bailing them out. It makes me sick that someone making 40k/year thought that they could afford a 600k house. I mean, are you serious?

Its called living beyond your means. I had to sacrifice to buy my first house and purchase responsibly. Now I have to sacrifice again in order to bail you out because you didn't have the common sense to know when too much was too much.

Honestly, I would have preferred to not have the bailout and let these irresponsible people get thrown out on the street and these companies go under. Guess what, the market corrects itself, and would have eventually. Now you have opened the doors to the gov. being the largest mortgage holder in the country.

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Johnathan Locke - Edgewater, MD - Karma: Good

Spare me - 2008-10-22 09:31:30

I love how every one speaks about how much they hate the Government being in control of everything, yet when the it hits the fan, everyone blames the government. How about passing the blame around to the people who took out mortgages they knew they couldn't afford, and the companies who fixed the numbers to make it work. You can't blame the government for everything. If more people would take responsibility for their own actions, the economy would not be as it is today, and it would improve alot quicker than everyone waiting for the government to fix it. I am not thrilled about the big bailout, I can not afford a mortgage, and turned it down when it was offered to me, I knew better. Yet, now I, apart of everyone, will be forced to save the mortgages of all the people who knew better, but did it any way, greedy little dirty birds, this is not the governments fault.

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Debbie F. - Arnold, MD - Karma: Bad

Mortgage Mess Due to Dems - 2008-10-20 22:09:47

If Congress had voted to restrict the growth of Fannie and Freddie when it was proposed by Rebublicans including John McCain, the sub-prime mess might not have happened and certainly wouldn't have been as bad. Obama's advisor Franklin Raines was CEO of Fannie Mae and oversaw numerous improprieties. Fannie Mae and Freddie Mac gave huge amounts of money to Democrats. The mortgage mess has many authors but most are Democrats.

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Anne Gibboney Huske - Annapolis, MD - Karma: Neutral

mortgage crisis - 2008-10-19 04:28:49

It came by scamming the ordinary, and newer buyers with variable rate loans that it would have taken a team of lawyers to unravel. Of course the banks made their money up front on fees, and then sold off the mortgages in various batches to investors who had hardly a glimpse into the real value, or lack thereof, of the properties behind the mortgages. 

And then wall street further complicated the situation, to confuse the ordinary investors who bought into these mortgages as a 'benign investment'. It reminds me of the time back in the 90's when interest rates fell. Older people, living off the interest on their savings were enticed into investments paying over 9.5% interest. How did these investmnets offer that amount - because they were scams that represented ownership of old jet aircraft that cannot legally be flown in much of the western world, and are worth only the value of the scrap metal. So, not only did those investors not see much of the promised interest income, but much of their principal disappeared as well. 

But don't be surprised - wall street learned from these lessons, and came up with ever greater scams. And that is why we may well be entering a new great depression. While many of the super-rich, who understood what was really going on, made their hundreds of millions, and got out early before the house of cards collapsed. 

And all this was encouraged by a republican administration that opposed any kind of regulation. The same republican group to which Sen McCain has hitched his wagon, in his bid for the white house. And we thought he was different then Bush and Co? With his 7 or more houses - so many he doesn't even know how many. Bet your last $$$ he will be beholden to the same people who gave us Bush. 

That is why we need a change, a totally new way of doing business in Washington, and looking out for the average American, not the super-wealthy of wall street.

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Stephen Kay - Severna Park, MD - Karma: Bad