The Obama administration’s latest financial regulatory reform proposal contains a stunning surprise hidden on page 67: “Rigorous application of the Community Reinvestment Act should be a core function of the CFPA.”
The Community Reinvestment Act, or CRA, should be a core function of the CFPA or the Consumer Financial Protection Agency.
Along with Fannie Mae and Freddie Mac at the very epicenter of the financial meltdown last year, the CRA is one of the vehicles used to inveigle, incent or threaten banks into lowering their lending standards to provide home loans to those who simply cannot afford them. According to his proposal, Obama’s new financial regulatory reform promotes more of the same disastrous policy.
Rep. Jeb Hensarling (R-Texas), the lone member of Congress on the Congressional Oversight Panel for the TARP program, pointed out in dissent to the January Special Report on Regulatory Reform: “Perhaps the most damaging initiative undertaken by the federal government was the effort to pressure private financial institutions to subsidize home ownership through the Community Reinvestment Act (CRA). Undertaken with the best of intentions — expanding home ownership among poor and underserved communities — the unintended consequences of the CRA clearly demonstrate that government’s attempts to manipulate market behavior to achieve social goals often lead to harmful results.
“Enacted in 1977, the CRA encouraged banks to extend credit to ‘underserved’ populations by requiring that banks insured by the federal government ‘help meet the credit needs of its entire community.’ To ensure that banks are meeting this mandate, each federally-insured bank is periodically examined by its federal regulator. As a result of its enactment, bank lending to low- and moderate-income families has increased by 80 percent.”
It would appear the Obama solution to “regulatory reform” is another sub-prime meltdown brought to you by more government thuggery forcing financial institutions to give home loans to even more people who can’t afford to pay their mortgages.
Price Goes Nuclear
The Hill newspaper reported late last week that House Speaker Nancy Pelosi (D-Calif.) was considering using White House-directed Office of Management and Budget (OMB) numbers to lower the price tag on Democrats’ staggeringly expensive health care boondoggles. The non-partisan Congressional Budget Office (CBO) has released a preliminary score on the first of the Democrats’ health care plans, and it’s a political and financial disaster for the Democrats. Early estimates of only the partial plan that does not yet include Democrats’ much-desired government takeover of health care came in at a whopping $1 trillion.
In response to the report of the consideration of use of OMB numbers, Rep. Tom Price (R-Ga.), Chairman of the Republican Study Committee and a former orthopedic surgeon, fired off a letter to Pelosi objecting to the sleight-of-hand on the health care numbers.
“To allow the White House to inject its political will into this process by cooking the books would be a contemptible move and would be met critically by House conservatives,” Price said in the letter. “Should the majority attempt to ram a health care package through Congress without providing honest accounting to the American people, all parliamentary and procedural tools afforded the minority party would be on the table to highlight this egregious move to deceive the American people.”
Now, here’s the rub.
Politico is reporting that Pelosi spokesman Nadeam Elshami denied the existence of any Pelosi-OMB plot, saying, “The health bill will be scored by CBO and any other suggestion to the contrary is simply not accurate. CBO is working hard to get the numbers the committees need to make informed decisions.”
How can anyone possibly discern whether the Speaker is telling the truth? Her reckless public accusations against the CIA, saying they lied to Congress, and her refusal to allow an investigation into whether or not CIA agents did in fact break the law leaves any critically thinking person confident in the fact that it was Pelosi who lied to the public about what she knew and when she knew it. Her credibility is in doubt every single time she says something is “not accurate.”
RSC Launches Sunset Caucus
The Republican Study Committee (RSC) has launched a new, bold effort to identify government programs that have outlived their usefulness, if they ever had any to begin with, and end them. Co-chaired by Rep. Kevin Brady (R-Texas) and Rep. Jason Chaffetz (R-Utah), the Sunset Caucus is “a new, permanent subset of the RSC committed to protecting taxpayers and shrinking the size of government — one wasteful, duplicative, or unnecessary program at a time,” as stated in the announcement. The caucus is comprised of 42 members of the RSC and growing.
Each member of the Sunset Caucus has made a commitment to, “Adopt one or more federal program they believe has outlived its usefulness or never should have been enacted; publicly champion the repeal or de-funding of the program(s); offer an amendment during the relevant appropriations bill to defund the program(s); and introduce stand alone legislation to sunset the targeted program(s).”
“I picked as my first program what is dubiously called ‘The Educational Cultural Apprenticeship and Exchange Program for Alaskan Natives, Native Hawaiians and the Historical Whaling and Trading Partners in Massachusetts,’” Brady, one of the caucus co-chairs, said at the announcement. “Let me tell you what that is: $8.75 million a year of your tax dollars are wasted connecting whalers in Massachusetts with their ancestors in Alaska and Hawaii. That’s equivalent of taking a small town in rural America with 2,000 people and taking every dollar they pay to Uncle Sam and putting it in this wasteful federal program.”
“This right here is the most dangerous credit card on the face of the planet,” said Chaffetz, the other of the caucus co-chairs. “It’s the voting card of the United States Congress. There seems to be no limit, no repercussions and no penalties for overusing this card. … It is not Congress’s money; it’s the people’s money. … I appreciate participating in this caucus, I look forward to it growing and participating and eliminating wasteful spending.”
Specific programs and subsidies targeted for elimination by the Sunset Caucus are a prime list of government waste. They include:
The unspent portion of the Economic Stimulus Package, the Presidential Election Fund, Americorps, the National Endowment for the Arts, Amtrak, the Nuclear Waste Fund, the Visa Lottery Program, Funding for GOP and Democrat Conventions, Farm Subsidies for Mohair, the Legal Services Corporation, the International Fund for Ireland, Enhancing Education Through Technology, Education Department Attache in Paris, Sugar Subsidies, Intergovernmental Panel on Climate Change, Educational, Cultural, Apprenticeship, and Exchange Programs for Alaska Natives, Native Hawaiians, and Their Historical Trading Partners in Massachusetts, Funding for Official Federal Employee Work Time for the Use of Union Activities, Coast Guard’s LORAN-C Radio Investigation System, Payments to Palau to take Gitmo Detainees, Corporation for Public Broadcasting, Local Government Climate Change Grants, Repeal of Davis-Bacon, and many more.