Smitty links Instapundit and gives a good reason for the demise of Fannie Mae and Freddie Mac. Neither entity is Constitutional. Mr. Smith corrects an assumption that mayor Micheal Bloomberg of New York City made;
“We look forward to the rapid fulfillment of this commitment so that Countrywide can sign another record-breaking agreement with Fannie Mae,” Mozilo finished.
Mozilo’s almost 20-year-old quote is relevant again thanks to the uproar New York Mayor Michael Bloomberg caused last week when he criticized Occupy Wall Street’s view of the financial crisis.
Bloomberg said, “it was not the banks that created the mortgage crisis. It was, plain and simple, Congress, who forced everybody to go and give mortgages to people who were on the cusp. … They were the ones who pushed Fannie and Freddie to make a bunch of loans that were imprudent, if you will.”
No, Bloomberg, the correct lesson is that the Community Reinvestment Act was false, and not in keeping with the spirit of the Constitution. Only the states should ever be interacting with citizens concerning their housing. The federal government should, at most, set some high-level standards. Then, the federal government could perform a useful oversight function.
How does Commander Smitty feel about the VA loan program for GI’s? I’ve never tried to use it, but the VA is supposed to guarantee loans for veterans for home ownership.