Will Team Obama ever learn? The Washington Post reports that the administration is “engaged in a broad push to make more home loans available to people with weaker credit,” and it’s leaning on banks to approve subprime mortgages — reviving the practice that sank the economy in 2007.
Uh-oh: Just when you thought housing prices were rising again and the market was returning to normal, President Obama seems set to repeat the old mistakes. With the economy lagging, he seems to fear that some first-time buyers won’t get mortgages, and so he’s pushing dicey deals for banks.
America has seen this horror film before: Starting in the ’90s, HUD began nudging Fannie Mae and Freddie Mac to OK more subprime loans — underwriting mortgages for people with bad credit who couldn’t pay back what they owed. It all came crashing down in the 2008 financial collapse.
Why would Obama want to repeat all that by seeking more loans for home buyers who banks can’t feel can’t afford them?
One guess: He’s spent so much of his public life on the side of those pushing the risky loans, he just can’t break the habit.
Alas, government involvement in the mortgage game has proved disastrous.
What will it take to get Obama & Co. to back out of that business entirely? (We shudder to think.)