The Bush Administration's Role in the Subprime Lending Crisis
You probably saw this already, but here's something interesting (by which I mean infuriating) by Eliot Spitzer on the administration's role in the crisis. According to Spitzer, predatory lending was so obviously out of hand that states were trying to step in and do something about it, but the administration used the Office of the Comptroller of the Currency to block their efforts and protect banks that were engaging in predatory practices.
You probably saw this already, but here's something interesting (by which I mean infuriating) by Eliot Spitzer on the administration's role in the crisis. According to Spitzer, predatory lending was so obviously out of hand that states were trying to step in and do something about it, but the administration used the Office of the Comptroller of the Currency to block their efforts and protect banks that were engaging in predatory practices.
posted by Winston Smith at
8:27 AM
7 Comments:
I wondered if there might be another side to this.
"Opponents of national bank preemption of state laws that restrict predatory lending have legitimate arguments to make. None of them were made by Spitzer, whose bald-faced lies are so easily exposed that if the Governor of New York had an ounce of integrity and an iota of intellectual honesty, he'd feel ashamed. Luckily for Eliot, he's a punk through-and-through, and completely devoid of either quality, so he'll sleep just fine tonight.
What a dork."
Hehe. He writes just like you, WS, with the colors reversed.
http://www.banklawyersblog.com/3_bank_lawyers/2008/02/eliot-spitzer-i.html
That's not my style. You're the one who wrote "Mitt Romney---Despicable Moron". It's a twin for the "Eliot Spitzer---Idiot" piece. C'mon, man---own it. After the crap I take around here, surely you can bear a little teasing.
As for the actual arguments, you'd have to follow the guy's link, although he gives fair space to each of the contestants' actual words. But we're not interested in content or tracking down both sides of the story. If Eliot Spitzer says Bush sucks, that's good enough to accept uncritically.
Ignoring the usual aggrieved, passive-aggressive rhetoric from TVD (since our host can take care of himself), it seems that the central question is: Had the federal government allowed state regulation of predatory lending even in national banks before 2003?
If it was mere teasing, then I retract my earlier comment. Sorry. Tone does not come across well in this venue.
The answer to my question appears to be a qualified 'yes'. I say qualified because the facts are presented by an advocate for continued state regulation.
Well, that's a fair comment, LL. [Here I go, Charlie Brown and the football again. But a fair comment earns a fair reply.]
The "other side" isn't contained in your link, but at least you acknowledge that. Intelligent discussion and principled disagreement is possible on the issue, then, and the banklawyersblog.com guy admits that. [And I passed his admission on.]
The Bush Administration need not be evil or incompetent to have taken the "other side," and Eliot Spitzer could be right, for the wrong reasons.
So, dispensing with the partisan cant, I'll just point to Riegel v. Medtronic, which is creating quite a stir in the legal industry [I work in it].
Basically, the Supreme Court decided just the other day that those huge medical-device product liability suits [similar to what plaintiff's attorney John Edwards earned his millions on] cannot proceed if the FDA approved the medical device.
Basically, what we're seeing here is the federal government, through the Interstate Commerce Clause [that's in the Constitution, for those who came in late], can short-circuit state laws and state lawsuits against corporations that do business nationally.
The interesting thing is that the decision was 7-1, with only Judge Ginsburg dissenting on grounds much like those in your link, that states have compelling interests, etc., etc.
Now, I dig federalism---power devolved to the states---but it seems that the ICC is totally applicable here, and the best thing is that it's not another chafing 5-4 decision.
Even the Supreme Court can occasionally largely agree what the constitutions meant, and means.
[Next up: lawsuits on pharmaceuticals. The powerful plaintiff's bar is in quite a tizzy---they're running out of people to sue.]
Let's just let corporations self-regulate. They've been so good at it up to now. No reason they might put profits before their customers; after all, Ayn Rand tells us they'd never do that. Or if they did, the market would punish them so we wouldn't have to.
While the Supremes are working on this, they should preempt state laws on implied warrant of merchantability. Caveat emptor!
No way should the little people be able to sue for their worthless little lives. The corporation is everything.
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