With studies showing home foreclosures hitting blacks and Latinos hardest, the Obama administration’s answer is baffling as well as destructive — to lend them more money, repeating the cycle of easy credit that led to the housing boom and bust.
A new AARP report finds that even elderly minorities are facing serious mortgage delinquencies. Fifty-and-over African-Americans, for example, are almost twice as likely to lose their home as older whites.
“This crisis is far from over,” AARP policy chief Debra Whitman said. “We need to think about more creative solutions.”
President Obama’s solutions, however, look a lot like the original problems that landed minorities in the financial mess they’re in today…
Home loans may only be the first step.
Dodd-Frank also has given CFPB the authority to collect from banks small-business lending data by race. Community organizers hope the data will provide as great a stimulus for minority small business lending as mortgage data has provided for minority homeownership.
All of these steps are being taken in the name of diversity or anti-discrimination. But they’re really an assault on capitalism. The government is telling banks they must lend money to people whether they can repay the money or not.
In the end, it will be the minorities Obama and Holder are trying to help who will be hurt most.
If a family is given a loan they wouldn’t otherwise qualify for, what happens when they can’t pay? They’re driven into debt, they lose their home. If the Democrats are in power, the banks will be blamed again, and the credit score cleaned up by a kindly government agent.
But it doesn’t change the underlying problem.
Minority Americans, like all Americans, need jobs to get a loan they can afford, and the opportunities to improve their own credit score.
They don’t need a handout that later turns into a slap in the face.