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Thursday, December 11, 2008
In the New York Times December 9 editorial, I have concluded from what the well intentioned editors have unknowingly done is expose the culpability of Congress for the collapse of the economy.
Reading thoughtfully and objectively between the lines this conclusion in my view leaps off the page. Here is the lead editorial in my N.Y. Times today, as follows:
"Mortgages and minorities, the mortgage crisis that has placed millions of Americans at risk of losing their homes has been especially devastating for black and Hispanic borrowers and their families. It seems clear at this point that minorities were more likely to be steered into risky high priced loans -- even when researchers controlled for such crucial factors as incomes, loan size and location.
"The Congress that takes office in January can start to deal with this problem by strengthening fair lending laws, especially the community reinvestment act which encourages fair, sound lending practices while requiring banks to lend, invest and open branches in low and moderate income areas."
The more revealing portion of this editorial stated the following:
"A particularly striking analysis in 2006 by the National Community Reinvestment Coalition found that nearly 55 percent of loans to African Americans, 40 percent of loans to Hispanics and 35 percent of loans to Americans fell into the high-cost category as opposed to 23 percent for whites." (High cost here refers to higher interest rates.)
First, let's attempt to understand Congress and why they do some of the things they do.
First and most significant is the cost now required to run for Congress. Like everything else in the U.S., a run for Congress has skyrocketed to around a million dollars to run a successful congressional campaign. To obtain this necessary funding has been made easier and here is why.
There were 2,000 lobbyists in the year 2000. By 2005, the number of lobbyists jumped to 34,750. They are chasing around Washington representing big business with plenty of money to fund campaigns. If congressional members vote for what their business bosses want, lobbyists will continue funding their political campaigns. This, in effect, gives the US.A. the best Congress lobbyist money can buy.
And the so-called "earmarks" represent the funding congressional members demand for the areas of the U.S.A. they represent. They need their votes. Congress passed the Community Re-investment Act requiring banks to lend, invest and open branches in low income and moderate income areas.
But one economic reality in the 2006 National Community Re-investment Coalition Analysis which showed loan costs were higher for blacks, Hispanics and American Indians as opposed to whites, requires analysis.
Did it ever cross the minds of the representatives of the National Community Re-investment Banks that with a click of a computer banks can determine complete credit histories?
Based on the credit history of the individual, loan interest rates are compiled. They are not determined on the skin color of white, black, Hispanic or American Indian -- and of course it shouldn't be. Let's get real!
In the same N.Y. Times December 9 edition a headline read "Uninsured Put a Strain on Hospitals".
Reed Abelson wrote the following:
"An increasing number of the unemployed and uninsured turn to the nation's emergency rooms as a medical last resort, doctors warn that the centers -- many already overburdened -- could have even more trouble handling the heart attacks, broken bones and other traumas that define the core mission.
"'We have no capacity now,' Dr. Angela F. Gardner, the president-elect of the American College of Emergency Physicians which represents 27,000 emergency doctors stated. 'There's no way do we have room for any more people to come to the table.'"
Reed Abelson added the reason streams of uninsured, unable to pay go to emergency room in droves:
"Emergency rooms are legally obliged to see all patients who enter their doors, regardless of their ability to pay. What kind of a Congress would mandate emergency rooms are legally obligated to care for the uninsured?"
This mandate is given without providing the money to pay for services.
Only a dead beat Congress, morally and ethically bankrupt!
Source: http://www.politicalcortex.com
