Tuesday, October 25, 2011

5 Myths Helping to Drive Occupy Wall Street

Occupy Wall Street is a lot like Barack Obama's 2008 campaign. It's so vague that everyone sees what he wants to see in the protests.

John Hawkins

Some people hate the bailouts, others want free stuff, some are mad about jobs being shipped overseas, others are old hippies hoping for a sixties’ revival and that's before you even start talking about the Communists, Nazis, anarchists, and wannabe revolutionaries.

Even though Occupy Wall Street is sort of a smellier, dirtier, less focused, more violent bizarre-world version of the Tea Party, some of the people attending the protests do mean well -- and they do have at least one legitimate grievance. Both parties in power gave the thumbs up to TARP and the bailouts, which were really little more than "heads, we win; tails, the taxpayers lose" crony socialism. Whether it's banks, big agriculture, solar firms, General Motors, or Chevrolet, big business shouldn't be given our tax dollars. If they can only make it with an infusion of taxpayer dollars, then it's better for the country in the long run if they don't survive.

That being said, since Democratic Party is running a 2012 campaign centered around one of the Seven Deadly Sins, envy, they’ve worked hard to create a number of myths that someone needs to address.

1) Wall Street created the housing crisis! Most people don't understand the housing crisis and that's largely because a lot of people don't want the public to understand it.

There's a simple reason for that: 90% of the blame lies with government.

Here's a nutshell explanation of how the housing crisis was created. In 1994, during Bill Clinton's presidency, the Community Reinvestment Act was changed. The government started making banks an offer they couldn't refuse: Start making loans to "bad risks" or -- and this was the unspoken threat -- your bank might have an "accident." Maybe the regulators will accuse you of bias. Maybe you'll need a merger and get turned down. Who knows what could happen?

The implicit threat from the government, which was really all about politicians being able to brag that they'd helped get the home ownership rate up, worked wonders...


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