Posted tagged ‘Barney Frank’

August 4, 2011

Barney Frank has written a clear, detailed and carefully reasoned explanation of why he voted against the debt ceiling bill.  It’s long enough to send most of it below the jump, but I want to highlight on the front page what my congressman had to say about our job now:

Dear Friend,

I appreciate you taking the time to let me know of your views on the debt limit.  As I will explain later, I think part of the reason that we wound up with a very unsatisfactory bill – one that I voted against – is that there was a disproportionate volume of communications from people who take a wholly negative view of virtually all government activity.  Fortunately, now that their efforts have called some fundamental values into question, a more broadly representative sector in the American public is speaking out and I think that will have a good result. [emphases added]

That is:  keep those cards and letters coming, now, through the summer, and all the way to Christmas.

There’s a lot more, all worth reading, reminding us (me) that despite the relatively negligible damage done up front by this deal, the potential remains for much worse to come.  To get Frank’s take, keep reading. (more…)

Ambinder’s Follies, Redux

October 7, 2008

Ambinder had a true howler today, one not picked up, so far as I can find on a quick search, as it should have been.

In what he billed as “The Daily Racism Debate,” Ambinder chided Barney Frank for having the temerity to suggest that the GOP and its allies might have had a racist edge when they blamed lending under the Community Reinvestment Act for the collapse in the housing market, and hence for the global financial crisis that we now endure.

Here’s what Frank said:

“They get to take things out on poor people,” Frank said at a mortgage foreclosure symposium in Boston. “Let’s be honest: The fact that some of the poor people are black doesn’t hurt them either, from their standpoint. This is an effort, I believe, to appeal to a kind of anger in people.”

Here’s Ambinder’s considered take on this apparently offensive statement, fisked lightly:

Had it not been for the Community Reinvestment Act and the cheap mortgages provided by Fannie and Freddie, a lot of poor, black people wouldn’t have homes.

Quick sleight of hand notice here:  Freddie and Fannie got Bush administration to meet affordable housing goals by buying up subprime mortgages; far from being a consequence of CRA rules, the two F’s exposure to the riskiest class of loans was increased as a part of mendacious and incompetent administration’s attempt to avoid the messy business of housing the poor.

But a lot of poor white people wouldn’t have homes either. So it’s classist, more than racist, if it’, indeed, is motivated by prejudice at all.

This is, of course exactly what Frank said:  see above.  He noted that the fact that some poor people are black is a feature, not a bug, for a campaign now increasingly obviously playing the “not-like-us” card to a crowd primed to react to the blast of the race dog whistle.

At the same time, it might speak to the recklessness of Democratic policies, well intentioned or not.

Well it would, if the policies were in fact reckless; i.e. — a significant contributor to the financial crisis.  Except, of course, they were not, at least when grown-ups minded the store.  See below for more on this.

Many of people can’t afford their mortgages, and the entire country is paying a price.  Hence the anger, which crosscuts with latent racial/culture biases.

Yes, fine:  but why do all these people have mortgages that they cannot afford?  Well Irvine Renter can give you chapter and verse on the incentive structure that led some people through folly and or deceit to borrow way beyond their means.

But if you look for the underlying cause of the mortgage and financial meltdowns, don’t you think the decision to remove most regulation of the banking sector might have something to do with it?  How about the creation of an even more lightly regulated pseudo-banking industry?  And what about the decision  — written into law by McCain advisor and potential Treasury Secretary Phil Gramm —  to leave more or less wholly uncontrolled the trillions of dollars in the kind of derivative financial instruments Warren Buffet has more than once warned were “time bombs, both for the parties that deal in them and the economic system.”

(This particular quote comes from the 2002 Berkshire Hathaway Chairman’s letter to shareholders.  2002!  That would be GOP controlled White House and, after Nov. both houses of Congress 2002, in case you were wondering.  This disaster was not a surprise to those paying attention).

Ambinder’s fellow Atlantic blogger, Ta-Nehisi Coates, has written several posts on the leap on the right to what he calls, rightly, the “Blame the Negroes” escape hatch, well before Ambinder published his post.  The key one is here.   If Ambinder had troubled to read his colleague with care, he would have seen a discussion of one of the best available one-stop debunkings of the whole CRA-poor-folk-are-the-problem slander.

Here’s the key quote from Robert Gordon’s breakdown of the role of CRA in the crisis:

Most important, the lenders subject to CRA have engaged in less, not more, of the most dangerous lending. Janet Yellen, president of the San Francisco Federal Reserve, offers the killer statistic: Independent mortgage companies, which are not covered by CRA, made high-priced loans at more than twice the rate of the banks and thrifts. With this in mind, Yellen specifically rejects the “tendency to conflate the current problems in the sub-prime market with CRA-motivated lending.? CRA, Yellen says, “has increased the volume of responsible lending to low- and moderate-income households.” [italics added]

So let’s recap.  Ambinder says, in essence, that Frank was playing the race card when he accused the other side of playing the race card in the argument over who should take the blame for the financial mess.

But Frank was right about both aspects of the question in dispute:  first, the CRA is not materially at fault — to state otherwise is a lie, disproved on the numbers over the decades-long history of the act; as you can see detailed in the piece on the other end of the link above CRA governed institutions are less, not more, likely to have engaged in bad lending practices…

…and hence, second, GOPers and the McCain campaign itself, are in fact playing to the worst of our national psychoses, as, with their now famous wink, they blame the irresponsible poor, many of whom, as Frank noticed, just happen to be black, for taking and defaulting  on loans that — they alledge —  would not have been made hwere it not for the dasterdly CRA.

That is:  Ambinder’s chiding of Frank for telling the truth echoes, perhaps amplifies, the very wound that Frank is trying to excise from our body politic.

To echo the source on this kind of post, Brad DeLong, why oh why can’t we have a better press corps.

Image: Walker Evans, Bethlehem houses and steel mill. Pennsylvania, Nov. 1935.  This image is available from the United States Library of Congress‘s Prints and Photographs Division under the digital ID fsa.8c52905.  Source:  Wikimedia Commons.