Re: Did Liberals Cause the Sub-Prime Crisis?

Conservative pundits have recently placed the blame for the current U.S. financial crisis on the Community Reinvestment Act of 1977. In a nutshell, this act requires lending institutions to make credit available throughout their geographic area, prohibiting them from discriminating against potential borrowers based on the neighborhood in which they live or work. It does not require them to weaken their assessment of potential borrowers' creditworthiness.

Writing in The American Prospect, Robert Gordon examines the claim that the CRA is responsible for the sub-prime crisis. He begins by tracing the genesis and evolution of this meme from the conservative economist Thomas DiLorenzo in September, 2007, to Robert Litan of the Brookings Institution just before Gordon wrote his article in April, 2008 (it has become even more widespread since then). He then offers several criticisms of the theory. They are, in essence, as follows:

- As my astute readers will have already noticed, the law was enacted a full quarter-century before the financial crisis emerged. Furthermore, if the act did pressure banks to make risky loans, then the weakening of the reporting requirements in 1995 and 2005 would have decreased that pressure, not increased it.

- The majority of the risky loans have originated from institutions that are not governed by the CRA. Gordon cites the Congressional testimony of Michael S. Barr, a University of Michigan Professor of Law.

- CRA banks have originated risky loans at a lower rate than other financial institutions. Gordon cites an address given by Janet Yellen, president of the San Francisco Federal Reserve. The law firm Traiger & Hinkley, LLP, also published a careful statistical analysis showing, among other things, that CRA banks originated fewer risky loans than other lending institutions did.

It would be convenient for the conservatives to be able to blame our current financial problems on a law championed by liberals. Unfortunately for them, the facts do not support that explanation of events.

Re: Greed in the Economy: It’s the Morality, Sinner (Part I)

In the linked blog post, Jim Wallis issues indictments for greed to those responsible for the current economic crisis. Although he states his argument in theological terms, the same conclusion can be reached easily using the principles of philosophical ethics.

The first step in Wallis' "morality play" is the "aggressive lending to potential home buyers using subprime and adjustable rate mortgages." The lenders profited by encouraging people to buy more expensive homes than they could safely afford, "knowing" that their own share of the risk was protected by the ability to foreclose the loans if (or when) the borrowers defaulted. Without going any further, we have a clear violation of Kant's Categorical Imperative, since the lenders used the unwitting borrowers as a means by which to increase their own profit.

Interestingly, this is the converse of an example that Kant uses to argue that the Categorical Imperative forbids deception. Specifically, in Grounding for the Metaphysics of Morals, he points out that if it were morally permissible for a person to borrow money with no intention of paying it back, then nobody would ever lend money. By similar reasoning, if it were morally permissible to lend money ostensibly for some purpose while secretly planning to foreclose on the loan before the borrower's purpose is achieved, then nobody would ever borrow money (for a purpose). Perhaps it's time for all of us to give more serious thought to the biblical admonishment -- "Neither a borrower nor a lender be." Without resorting to that (probably socially unimplementable) extreme, however, it is still clear that the subprime lenders engaged in unethical behavior.

Of course, this is just the first step in Wallis' "morality play."

The Professor (Humor)

You should read the linked article *first*. [My advisor recommended that I expand on this idea. First of all, "the linked article" is the Wikipedia page about the character The Professor from the popular television series Gilligan's Island. Second, the link is the title of this blog post, so click on the words "The Professor (Humor)" just above this paragraph, and then come back here and read the rest of this post.]

Decades later, it was revealed that all of The Professor's books were
actually hollowed out to hide his collection of trashy romantic novels
that he brought along for the three hour pleasure cruise. The true
source of his encyclopedic knowledge was the satellite link and web
browser (that he of course fashioned from coconuts and bananas) to
access the still highly classified Internet, World Wide Web, and
Wikipedia, all of which he had invented in his high school classroom.

These top secret tools of the military-industrial complex were
gradually made available to the public in the aftermath of the Cold
War. However, they were disguised as recent inventions, mainly to
protect Al Gore's secret identity as The Professor. Of course, the
secret was almost unveiled in 1999 when Gore nearly blew his cover
during an interview with Wolf Blitzer in which he came dangerously
close to revealing that he had actually invented the Internet.

Covering up this slip required one of the most massive disinformation
campaigns in the history of the U.S. It was organized by the genius
of disinformation Karl Rove, who asked for nothing in return except
some minor advocacy in the 2000 U.S. Presidential election by
Katherine Harris (the assumed identify of Ginger) and U.S. Supreme
Court Justice William Rehnquist (actually Mr. Howell).

Re: The Best Man Turned Out To Be A Woman, by Ann Coulter

Aside from her polarizing politics, there is nothing particularly "wrong" with Gov. Palin. However, there is nothing particularly right about her, either. A conservative [pun intended] estimate of the number of conservative women with as much administrative and leadership experience as her would easily be in the thousands. I personally know dozens who are at least as qualified, and so do you.

Oh, and by the way. If you're going to compare "experience" in any kind of legitimate way instead of simple-minded rhetoric, simply managing his massive grassroots campaign organization has given Obama just as much executive experience as Gov. Palin has, if not more.

Here's the surprise (for me): this bleeding heart liberal agrees completely that Gov. Palin's daughter should be left alone. What isn't surprising to me is that Barack Obama emphatically made exactly that point to the press when they asked him about her. That is precisely the response one would expect from a man of principles.

Here's another surprise: I agree that it is sexist to consider Gov. Palin's parenting responsibilities to her detriment. If a child can be raised by only one parent while the other is serving in elected office, then it shouldn't matter whether the parent doing the raising is the mother or the father. I'm not sure that's what I call "family values," but at least it's a consistent ethic.

BTW, Republicans don't have hair plugs? People should vote for McCain because Sarah Palin once wanted to work for ESPN? Come on, Ann. Keep your "colorful" writing, but please stop insulting people's intelligence.