Daily Reminder: January 2, 2012

A normally Obama-friendly New York Times ran, on the morning of January 2, 2010, a piece overtly criticizing efforts made by the Obama administration nearly a year before purported to protect American homeowners from foreclosure.

In February 2009, the president was in foreclosure-torn Arizona to announce the $75 billion Making Home Affordable program, which has reduced monthly mortgage payments and shifted arrearages to the tail end of mortgage loans in an attempt to forestall a lengthier collapse in housing.

According to the New York Times, however, more and more critics argued that the program did little to prevent an augmented collapse while, instead, merely delayed the “wrenching yet cleansing process through which borrowers give up unaffordable homes and banks fully reckon with their disastrous bets on real estate, enabling money to flow more freely through the financial system.”

Of course, those “disastrous bets” made by banks at the behest of the federal government during the 1990s as part of the Clinton administration-overseen rewrite of the Community Reinvestment Act to require banks to relax lending standards for minority borrowers. In fact, a May 31, 1999 article in the Los Angeles Times hailed the surge in black and Latino homeownership “one of the hidden success stories of the Clinton era.”

So, the January 2, 2010 New York Times piece should come as no surprise. After all, Making Home Affordable was merely a $75 billion government solution to a problem caused, likewise, by the government. The only surprise is that the New York Times ran the article at all.



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