Pumping a new housing bubble: The Obama administration redefines insanity & ignorance
The “spread the wealth” Obama administration is encouraging relaxation of mortgage-lending standards — “help” for less-affluent borrowers that threatens a housing-meltdown repeat, which would harm all Americans.
Too many mortgages for too many borrowers with too little ability to repay inflated the housing bubble. Defaults that inevitably resulted burst that bubble — disastrously. Now, despite signs of housing's recovery — and lenders' sensible imposition of tighter standards for borrowers — this interventionist, redistributionist administration can't leave well enough alone.
It's insanity, redefined. It's ignorance, doubled-down.
The Washington Post reports that the Obama White House is:
• Pushing banks to make greater use of the Federal Housing Administration and other taxpayer-backed programs that insure mortgages against default
• Urging lenders “to use more subjective judgment” in evaluating mortgage applicants
• Assuring lenders, via its Justice Department, that they won't face legal or financial consequences if defaults rise — which they surely will.
By “helping” first-time and borderline-creditworthy buyers today, the Obama administration moves the housing market and the economy toward another crash tomorrow. Thus, taxpayers — and the economy — will suffer when a new round of mortgage defaults occurs in an unnecessary crisis driven by an administration whose political motivation far exceeds its economic savvy.