Ask why Barack Obama wants to make us all wards of the state, with state health care. Is this a good moment to embrace 20th Century Socialism Lite, even if we are facing a year or two of belt tightening? Shouldn't the future be freer, with less state interference in our lives?
The Community Reinvestment Act (CRA) did the same thing with traditional banks. It encouraged banks to serve two masters -- their bottom line and the so-called common good… By pressuring banks to serve poor borrowers and poor regions of the country, politicians could push for increases in home ownership and urban development without having to commit budgetary dollars. Another political free lunch.
The roots of this crisis go back to the Carter administration. That was when government officials, egged on by left-wing activists, began accusing mortgage lenders of racism and "redlining" because urban blacks were being denied mortgages at a higher rate than suburban whites. The pressure to make more loans to minorities (read: to borrowers with weak credit histories) became relentless. Congress passed the Community Reinvestment Act, empowering regulators to punish banks that failed to "meet the credit needs" of "low-income, minority, and distressed neighborhoods." Lenders responded by loosening their underwriting standards and making increasingly shoddy loans.
They say, ‘Well, this is a failure of the markets. Oh, this is about greed on Wall Street.’… the problem here is government intervention in the free markets. 1995, when Bill Clinton decided to tell, you know, [then-Treasury Secretary] Robert Rubin to rewrite the rules that govern the Community Reinvestment Act and push all these institutions to lend to minority communities, many were very risky loans. That was a noble idea, perhaps, but that certainly wasn't following free-market principles. This big pressure on institutions to dole out money and these risky loans started this whole ball rolling at Fannie and Freddie.
There are also subsidies to certain types of mortgages. The Community Reinvestment Act bans so-called ‘red lining’ -- requiring banks to offer mortgages in the entire geographic area in which they operate, not just to do business in suburbs. Loans in profitable areas were then used to subsidize loans in areas where banks were losing money.
In 1989, sympathetic members of Congress got the Home Mortgage Disclosure Act amended to force banks to collect racial data on mortgage applicants; this allowed various studies to be ginned up that seemed to validate the original accusation… bank regulators required the loosened underwriting standards, with approval by politicians and the chattering class. A 1995 strengthening of the Community Reinvestment Act required banks to find ways to provide mortgages to their poorer communities. It also let community activists intervene at yearly bank reviews, shaking the banks down for large pots of money.
So when businesses are already looking for opportunities over the rivers and past the bay, what does our Senate do? It decides to insist that business provide paid time off for family leave...There is a reason that only two states have enacted this legislation. It is because states do not want to lose the businesses that make up the backbone of their budgets. New Jersey senators don't care because this is other people's money anyway. They can stand and pontificate over how they are helping people while those same citizens' employers say ... goodbye.
The nanny state continues, churning out one bad piece of legislation after another!....Yes, we should have compassion for people, compassion for our workforce. When my father had a heart attack in November, which went well into December, I had to take time off - but I worked around it ....Not all workplaces can do that. Those that can should look for ways to accommodate employees, if possible. This is a slippery slope we're on in New Jersey. The nanny state legislators want to give away everything, but forcing this kind of legislation on employers is the beginning of the end. It will drive employers right out of New Jersey, increasing the already alarming exodus of manufacturing and other jobs and residents in general.
Every liberal on the campaign trail has a plan to deliver free, socialized medicine, but no country on earth, folks, can possibly pay for every test for everybody without going bankrupt.
It's an expansion. And it's a stealth mechanism to put the tentacles of socialized medicine even deeper into society.
