Obama administration to rerun housing disaster by lowering lending standards once again

By Rob Janicki

Here we go again!  Not satisfied with failing miserably to stimulate the economy, the Obama administration is going to reinvent the square wheel.  That's the one that got the country into a terrible recession that has seen no return to pre-recession economic levels.  Here's Obama's square wheel proposition.

Housing finance experts are alarmed at the Obama administration push to lower lending standards for home loans to spur the recovery.

The Washington Post reported on the administration’s move Tuesday, noting that the administration thinks the housing market is “leaving too many people behind.”...


Leaving people behind who can't afford the payments on a house is part of the free market.  The Democrats in the form of Barney 'Fife' Frank and Chris 'Dummy' Dodd are the ones that lowered loan standards that brought people into the housing market that simply could not afford the homes they bought in the face of any economic downturn.

Now the Obama administration wants to replay this scenario, once again placing taxpayers on the hook for another inevitable round of marginal mortgage failures that are sure to happen.  Liberal progressives never seen to see the error of their ways and think that maybe a little more of the same medicine will work the second time around.

“The administration seems to be doing exactly what was done in 1992 when Congress adopted the affordable housing requirements for Fannie Mae and Freddie Mac [which] eventually produced the financial crisis of 2008,” said Peter Wallison, a member of the Financial Crisis Inquiry Commission that looked into the 2008 financial collapse...

The idiocy continues with this ...

The administration’s housing officials want the Justice Department to assure lenders that they will not be held liable for issuing risky loans that consequently default, the Post reported...

If lenders are assured that they cannot fail, they will have no safeguards in place that would normally be employed to protect themselves from bad loans.  And who will pick up those failed loans that are certain to happen with such lending practices?  The taxpayers, of course, will once again be on the hook.

When government inserts itself in the free market and attempts to alter the practices of private enterprise, only bad things can result.  And yet, liberal progressives simply cannot see that their meddling, more often than not, causes more problems, rather than less and solves nothing in the long run.

Read the full article here