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ACORN’s Blackmailing of Banks

October 15, 2009

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Rep. Michele Bachmann (R-Minn.) (pictured above at right) explained to Glenn Beck on his TV show last night how  the radical left-wing activist group ACORN uses the Community Reinvestment Act (CRA) to shake down banks.

The federal government, in effect, threatens banks into lending money to risky mortgage borrowers, Bachmann said. The CRA allowed groups such as ACORN to use the law to push banks into doing things they didn’t want to do.

CRA helped to change the way U.S. financial institutions operate. It didn’t cover all mortgages, but the law opened the door for community organizers to weaken lending standards. ACORN pressed hard for the legislation that forced them to take on riskier borrowers. To seek a race-based kind of social justice, CRA prohibited banks from restricting loans to more affluent, creditworthy markets, a business practice now known by the epithet “redlining.” The statute gave federal bureaucrats discretionary authority to make trouble for banks that failed to lend enough money to “underserved” minority communities.

After CRA took effect, ACORN and groups with similar goals entered the shakedown business. At one ACORN conference, Jesse Jackson urged an aggressive approach: “Why did Jesse James rob banks? Because that’s where the money was.” This megaphone-assisted panhandling intensified when the Clinton administration put the CRA on steroids.  CRA allowed activists to blackmail lenders into handing out mortgages to people with little regard for their ability to keep up payments. Banks felt the heat from community organizers and CRA examiners and instead of fighting, they made loans they shouldn’t have made, and they paid out millions of dollars in protection money to ACORN and its brethren.

If banks refused to play ball with ACORN, they risked receiving a failing CRA report card from government bureaucrats. Said Bachmann:

“We’ve uncovered data of banks all across the country that made these gifts of money to ACORN — equipment gifts — or partnered with ACORN in order to get a good rating so they’d get out from under the radar screen of the federal government; in other words, so they don’t get their interstate branch banks shut down or so that they could expand.”

Now ACORN has joined forces with other leftist groups in an effort to expand the CRA. As an added bonus, ACORN will be able to receive federal funds next month when the current congressional ban on funding ACORN expires. (The ban is included in the continuing resolution that is funding the federal government pending passage of the fiscal 2010 spending legislation.)

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14 Comments
  1. Julie Trevor permalink
    October 15, 2009 4:48 am

    Question:

    If what Rep Bachmann says is true (that banks were pressured into lending to risky borrowers); why didn’t they lobby to change the CRA when there was a good opportunity for it to happen i.e. GWB 1st term?

    • In the know permalink
      October 15, 2009 5:18 am

      Because Bush is a progressive too. He isn’t a radical though. That’s the point of Beck’s argument. They are all corrupt and deserve the highest charge of treason leveled on them.

      • In the know permalink
        October 15, 2009 5:22 am

        And, props to Rep. Bachmann for pointing out ground zero for the economic “china syndrome”. I fear for her life.

    • October 15, 2009 5:25 am

      There wasn’t a good chance to weaken the CRA during Bush 43’s first term. Bush wasn’t interested in rocking the boat. When Congress wanted to review CRA in the 1990s, ACORN stormed the congressional hearing, see
      http://www.capitalresearch.org/pubs/pubs.html?id=663. Barney Frank and his predecessor as chairman of the House Financial Services Committee, Mike Oxley (R-Ohio), were of the same mind on almost everything.

      • Julie Trevor permalink
        October 15, 2009 6:23 am

        Matthew, thanks for the link – it was a good read. One of the “lessons” from the piece…keep protesting – it works!!!

        Julie

    • Bank Employee in a past life... permalink
      October 18, 2009 6:46 pm

      Possibly they didn’t lobby also because they have ALWAYS been terrified of CRA. When I started in banking in 1981, I innocently asked what CRA was. The expressions on their faces were about what I would expect when Harry Potter mentions Voldemort by name. I left banking later in the ’80s, but I can well imagine that they are too afraid to stand up against CRA – they think that by appeasing ACORN and others, they can preserve their companies. Talk about a bad bet…..

  2. October 15, 2009 7:54 am

    Now my dear friends you are beginning to understand the financial collapse and WHO is really responsible. The Demoncrats rammed CRA through just like they are doing with the health care scam this very moment. Barney Frankfurter and Dodd the Dolt, railroaded the lending institutions into making bad loans to human trash that had no intention of ever making the first payment. In most of the cases the loans where in default within the first months of service!

    After reading this article you should now understand the Obomber bank bailouts. The ACORN scum used the CRA, and other like government hammers, to force banks into these bad loans. When the human trash getting them defaulted then the banks black mailed the government into paying them back by threatening to expose this scheme during the elections. Obomber made this back door deal with the banks and so they kept their mouths shut!

    The banks could have derailed the Obomber campaign at anytime they wanted, but they knew that their ‘boy’ was going to play to their tune in order to get elected. This is how the politics of the Beltway are orchestrated folks.

    It’s the banks, stupid!

    BTW: McCain would have done the same thing, he is no better!

  3. David Thomson permalink
    October 15, 2009 10:36 am

    David Horowitz and I agree on just about everything. We strongly differ, however, regarding the alleged conservatism of Martin Luther King, Jr. and the number one reason for the current mortgage crisis—the forcing of our nation’s lending institutions to provide mortgages to minorities possessing abysmally awful credit histories. The odds were overwhelmingly high that there would be huge numbers of defaults. It was virtually inevitable. Many people feel uncomfortable discussing this harsh reality. John McCain even refused to discuss the issue during a crucial debate with Barack Obama. He most assuredly lost the election due to his politically correct inhibitions.

  4. Cas Balicki permalink
    October 15, 2009 1:17 pm

    “Human trash”?

    When did all bad credit risks become human trash? In my life I’ve dealt with all kinds of people. I’ve been to meetings that after their conclusion made me feel as if I needed a shower, but never once did I see the people I met with as human trash. By contrast I’ve met and dealt with people who stood head and shoulders above almost everyone you could meet, but they were decidedly not saints. It was this latter group I wanted to have more dealings with, they were the people that you could both do business with and wanted to befriend. The messiest situation I ever had anything to do with was in which I was actually forced to negotiate with a man I could easily call a crook. I didn’t know how dishonest he was until it was too late. Yet, I negotiated the position that I was dealt to the best of my ability and I can still deal with both sides of this transaction amicably. To a degree I take some satisfaction in this. The reason I write “to a degree” is that I have since quietly refused to do business with the crooked end of that negotiation despite the fact that this man gave me some exceedingly good advice at one point during that episode. I raise this last point because even though I will never do business with the man again given of his personal shortcomings, he was not then and is not now human trash. He is just someone I will not do business with. We all have shortcomings on which we would never want to be judged. Human trash indeed! Who among us when stressed can’t be tarred with that brush?

    • October 18, 2009 7:31 pm

      Well lets see! Would anyone working for ACORN be at the top of that list? What would you call someone who is cradle to grave believing in the expectations of a government check and government entitlements just because they exist! Someone who has spent a lifetime of scamming the system and lying their way through life from one place to another! Or how about the con-artist house flippers who scammed their way into lucrative deals on government repos using CRA loan guidelines. Who then got greedy and started loading up on CRA properties and then got hit ‘holding the bag’ when the market fell out! To name just a few!

      These are the types of folks who got the majority of these ‘bad loans’, not the truly needy working low income folks for whom they where designed, most of those folks where and still are ignorant of the CRA entitlements, and that’s what they are, another form of entitlements, gone bad!

  5. jac mills permalink
    October 16, 2009 3:51 am

    I only hope that more like Michelle Bachmann will be elected in 2010, Dem or Rep., and none like Frank and Dodd, although that surely is wishful thinking. If there is any consolation to be taken on these kinds of revelations it is that America does not suffer alone because of crooked politicians. Look at Britain’s Parliamentarians today, for example. Many of them are so bent I laugh at their shenanigans involving their expenses and allowances every time I read a Brit newspaper. I have pondered for so long about what can be done and can come up with only one real solution: TERM LIMITS FOR ALL.

  6. Donnamarie permalink
    October 16, 2009 4:47 am

    About Bush-I remember him taking credit for all the “homeownwers” there were during his term/s. He called it a “homeownership society”. That is why I blame the Republicans for a lot of what is going on today.

    On the same note-Hillary Clinton countered that with the fact that it was not a “homeownership society” it was an “on your own” society. (I thought that was supposed to be a good thing.)

  7. Keith permalink
    October 16, 2009 8:07 am

    Michele Bachmann is a big target for the Radical left. We need her and more like her. The Olbermanns and the Maddows of the media take great pleasure in smearing her, almost as much as they do to Sarah Palin.

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