|
Townhall
Bouncing
Ball Politics
By Thomas Sowell
May 07, 2013
If
you are driving along and suddenly see a big red rubber ball
come bouncing out into the street, you might want to put your foot on
the brake
pedal, because a small child may well come running out into the street
after
it.
We
all understand that an inexperienced young child who has his
mind fixed on one thing may ignore other things that are too dangerous
to be
ignored. Unfortunately, too much of what is said and done in politics
is based
on the same tunnel vision pursuit of some "good thing," in utter
disregard of the repercussions.
For
years, home ownership was a big "good thing" among
both liberal Democrats like Congressman Barney Frank and Senator
Christopher
Dodd, on the one hand, and moderate Republicans like President George
W. Bush
on the other hand.
Raising
the rate of home ownership was the big red bouncing ball
that they pursued out into the street, in utter disregard of the
dangers.
A
political myth has been created that no one warned of those
dangers. But among the many who did warn were yours truly in 2005,
Fortune and
Barron's magazines in 2004 and Britain's The Economist magazine in
2003.
Warnings specifically about the dangerous roles of Fannie Mae and
Freddie Mac
were made by Federal Reserve Chairman Alan Greenspan in 2005 and by
Secretary
of the Treasury John W. Snow in 2003.
Many,
if not most, of the children who go running out into the
street in pursuit of their bouncing ball may have been warned against
this by
their parents. But neither small children nor politicians always heed
warnings.
Politicians
are of course more articulate than small children, so
the pols are able to not only disregard warnings but ridicule them.
That was
what was done by Congressman Barney Frank and Senator Christopher Dodd,
among
many other politicians who made the pursuit of higher home ownership
rates the
holy grail.
In
pursuit of those higher home ownership rates, especially among
low-income people and minorities, the many vast powers of the federal
government -- from the Federal Reserve to bank regulatory agencies and
even the
Department of Justice, which issued threats of anti-discrimination
lawsuits --
were used to force banks and other lenders to lower their standards for
making
mortgage loans.
Read
the rest of the article at Townhall
|
