Bush Admin. pre-empted lending regulation.

[SirNitram]

Link

Several years ago, state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders. Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive "teaser" rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks. These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets.

Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers.

Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government. Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many subprime lenders that were engaged in predatory lending practices. Several state legislatures, including New York's, enacted laws aimed at curbing such practices.

What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no.

Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.

Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.

But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation.

Throughout our battles with the OCC and the banks, the mantra of the banks and their defenders was that efforts to curb predatory lending would deny access to credit to the very consumers the states were trying to protect. But the curbs we sought on predatory and unfair lending would have in no way jeopardized access to the legitimate credit market for appropriately priced loans. Instead, they would have stopped the scourge of predatory lending practices that have resulted in countless thousands of consumers losing their homes and put our economy in a precarious position.

When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners, the Bush administration will not be judged favorably. The tale is still unfolding, but when the dust settles, it will be judged as a willing accomplice to the lenders who went to any lengths in their quest for profits. So willing, in fact, that it used the power of the federal government in an unprecedented assault on state legislatures, as well as on state attorneys general and anyone else on the side of consumers.

There you have it. Every. Single. State united against this. This was one of the few truly bipartisan moments. But the rise of payday lenders, lending to subprime borrowers, risky 'liars loans' to all comers, and so forth were more important.

[Einhander Sn0m4n]

So now we have a smoking gun tying Bush directly to the economy going to Hell. Isn't this exactly what happened to Texas, the baseball team, and every last business the fucking asshole ever ran?

[Molyneux]

Why the fuck did this not hit any newspapers before now?

[SirNitram]

Why the fuck did this not hit any newspapers before now?

Well, 2003, you were running stories about how Iraq was going to kill us all, or you were a filthy traitor to America...

And if you said anything bad about the Ownership Society you hated the American Dream..

[Civil War Man]

As if I needed to hear any more to label Bush as the worst president in the history of this country.

Seriously, we just need a few confirmed sex scandals and smallpox blankets and he will become a conglomorate of all of the worst qualities of our worst presidents. Basically the Voltron or Captain Planet of intentionally malevolent leadership.

[Rogue 9]

As if I needed to hear any more to label Bush as the worst president in the history of this country.

Seriously, we just need a few confirmed sex scandals and smallpox blankets and he will become a conglomorate of all of the worst qualities of our worst presidents. Basically the Voltron or Captain Planet of intentionally malevolent leadership.

You know, I would think you of all people would think Buchanan was worse.

But what the fuck? Seriously, what did the administration stand to gain from this? Even if every single member was heavily invested in the banking industry it still wouldn't benefit them, because as we've all seen this shit causes the whole thing to crash, the banks included.

[SirNitram]

As if I needed to hear any more to label Bush as the worst president in the history of this country.

Seriously, we just need a few confirmed sex scandals and smallpox blankets and he will become a conglomorate of all of the worst qualities of our worst presidents. Basically the Voltron or Captain Planet of intentionally malevolent leadership.

You know, I would think you of all people would think Buchanan was worse.

But what the fuck? Seriously, what did the administration stand to gain from this? Even if every single member was heavily invested in the banking industry it still wouldn't benefit them, because as we've all seen this shit causes the whole thing to crash, the banks included.

You're using logic and reason and evidence. They're using idealogy. Less Regulation == Good.

[aerius]

But what the fuck? Seriously, what did the administration stand to gain from this? Even if every single member was heavily invested in the banking industry it still wouldn't benefit them, because as we've all seen this shit causes the whole thing to crash, the banks included.

They get 5 years or whatever to make a goddamn killing in the market and collect kickbacks from their banker buddies, then they get to cut & run when the system starts going down. And if things get too bad for their tastes, they'll just bail themselves out with your tax dollars.

[Civil War Man]

You know, I would think you of all people would think Buchanan was worse.

Buchanan decided to inflict the nation with his idiocy for only 4 years. That's more than Bush was willing to do.

[PainRack]

Why does this sounds exactly the same as what Reagan and Bush snr did back in the 80s?

[Adrian Laguna]

As if I needed to hear any more to label Bush as the worst president in the history of this country.

You know, I would think you of all people would think Buchanan was worse.

Wouldn't Civil War Man hate Andrew Johnson more than Buchananan? He probably had the biggest hand in making the Reconstruction fail, thanks to him the South is still a shithole begging for Zombie Sherman to go burn it again.

Also, I think Wilson is worse than Bush (in terms of 20th century Presidents, anyway). There are a lot of reasons to support this, but I'll just mention one for the sake of brevity: 323,155 pointless casualties.

[Adrian Laguna]

Why does this sounds exactly the same as what Reagan and Bush snr did back in the 80s?

Hey! Don't lump Reagan and Bush Sr. together. The latter derisively referred to the later's policies as "voodoo economics".

[Flagg]

As if I needed to hear any more to label Bush as the worst president in the history of this country.

Seriously, we just need a few confirmed sex scandals and smallpox blankets and he will become a conglomorate of all of the worst qualities of our worst presidents. Basically the Voltron or Captain Planet of intentionally malevolent leadership.

He's a direct descendant of Franklin Pierce, the second (or third, depending on how I'm feeling about Andrew Jackson at the moment) worst president in history.