LatinaLista — Now that the House of Representatives has signed off on the $700 billion rescue/bailout plan, people are breathing a sigh of relief that credit will finally start loosening up to get those car and college loans. They’re also doing what should have been done a long time ago â€” looking at what caused the mess that made passing this bill not just necessary but imperative.
Unfortunately, when looking at what caused this mess â€” the granting of subprime mortgages â€” conservative politicians and commentators are running to blame Latinos and blacks for the financial meltdown.
According to them, if it wasn’t for the fact that Latinos and blacks qualified for home loans under the Community Reinvestment Act (CRA), which was specifically set up to grant loans to people who have historically been denied homeownership, then none of this would have happened.
Well, only in a conservative’s world where people of color are made the easy scapegoats for what goes wrong in this nation, can this be true. When time is taken to look at the facts, the truth emerges and it’s a whole lot different than what conservative pundits are saying or want us all to believe.
For starters, it’s not just the risky borrowers who are at fault but the risky loans created by predatory lenders. When it comes to loans created under the CRA, while some of those loans did contribute to the Wall Street mess, it wasn’t anywhere near to blame as conservatives like to say it is.
In fact, only 20% of the subprime loans in 2006 were issued by CRA banks.
However, it isn’t a coincidence that most of the people caught up in subprime mortgages are people of color and poor. The majority of people who live below and at the poverty line are people of color. Reports have long documented how the poor have been targets of predatory lenders.
Because they lack education. They don’t know how to shop around for a mortgage, comprehend the fine print or even calculate what the loan will cost them beyond the first year â€” and they gullibly believe that their mortgage lender has their best interests at heart.
Where’s the logic in blaming poor people for the excesses and greed of the rich and elite?
John Taylor, president and chief executive of the National Community Reinvestment Coalition, an umbrella group that promotes access to credit and affordable housing, said such claims “are on the level of Swift boat advertisements, except they are even less factual.”
“People who are saying this don’t understand lending, but they sure do understand the political process,” he said. “They are trying to blame the victim, which is an old strategy that moneyed corporate interests always employ.”
Profit, he said, was the motive.
We can only wonder what the motive is for these conservatives to cast this hateful and racist blame. The very people they are blaming are the ones hurting the most and losing the homes they have poured their heart, sweat and hopes into.
These conservatives who blame these people are less interested in a unified country but seem intent to drive a wedge between races and economic classes. If it weren’t so pathetically true, it would be a great plot for a science fiction novel.
These conservatives who are blaming poor people just don’t want to take responsibility for their own party’s actions that led to this fiasco where greed bulldozed over ethics. In the Bush Administration, the examples of where this has been the norm makes it no wonder that those who could and would followed the example set in Washington.
While the $700 billion will begin the financial mending of our free market economy, the partisan rhetoric that has surfaced is only making the healing of this country more difficult and underscoring that even though it’s the year 2008, it feels more and more like the 1960s.