Morality of Wealth Redistribution

[bripat9643]

Nope. They provide jobs and inexpensive consumer goods. Walmart enables millions of people to live better than they could otherwise. On the other hand, our socialist education system makes our population stupid, and does it at great cost.

And pay wages low enough to suck BILLIONS of fthe Gov't in WELFARE to survive, that's Walmart entire Biz model

OK, so the government should shut Walmart and McDonalds and all the other businesses like them down. Then what have you got? $10 hamburgers? $$60 shirts? Good for you. You have just thrown 3 to 5 million people out of work.

No, what you have is a bunch of unemployed people, but at least the Obama drones wouldn't be able to blame Walmart for all the unemployment insurance and welfare they would be sucking down.

 

[dnsmith35]

'twas Wall Street greed what done it, some folks say, when it comes to explaining the spectacular housing meltdown of recent years, which had its roots in a great many astonishingly risky loans. Other folks suggest that the federal government just may have played something of a role in inducing, even strong-arming, banks to take risks they otherwise would have avoided. Specifically, the Community Reinvestment Act and related policy pressures are pointed to as culprits, part of a government effort to extend home-ownership in lower-income neighborhoods. Now comes a new study from the National Bureau of Economic Research that says, quite bluntly. that the CRA played a major role.

Study Says Community Reinvestment Act Induced Banks To Take Bad Risks - Hit & Run : Reason.com

 

[dnsmith35]

Why did the Housing Market Crash? There are many people who are asking this question and most of them did not recognize the irrationality during the housing bubble nor had the foresight that the housing bubble would collapse.

Contrary to the misconception that it was the free market that made the housing bubble possible it was interference in the market place that distorted the demand and supply variables for credit and real estate. The Federal Reserve greatly distorts the supply and availability of money with its anti-free market loose interest rate manipulation. The Government also interferes in the market place with non-sense guarantees of home loans made through Fannie Mae, Freddie Mac, USDA, and VA.

It wasn’t the free market that encouraged malinvestment and speculation. It was the Government guaranteeing home loans through various agencies such as Fannie Mae and Freddie Mac that eliminated risk as the lender would have the ability to make loans while the Government guaranteed its potential losses.


Why Did The Housing Market Crash?*|*WTF Finance

 

[dblack]

Do you guys get that this whole 'why did the market crash' bickering has exactly nothing to do with the moral justification for wealth redistribution?

 

[dnsmith35]

Although the media are full of talk that we face a "crisis of capitalism," the underlying cause of the financial meltdown is something much more mundane and practical--the housing, tax, and bank regulatory policies of the U.S. government. The Community Reinvestment Act (CRA), Fannie Mae and Freddie Mac, penalty-free refinancing of home loans, tax preferences granted to home equity borrowing, and reduced capital requirements for banks that hold mortgages and mortgage-backed securities (MBS) have all weakened the standards for granting mortgages and the housing finance system itself. Blaming greedy bankers, incompetent rating agencies, or other actors in this unprecedented drama misses the point--perhaps intentionally--that government policies created the incentives for both a housing bubble and a reduction in the bank capital and home equity that could have mitigated its effects. To prevent a recurrence of this disaster, it would be far better to change the destructive government housing policies that brought us to this point than to enact a new regulatory regime that will hinder a quick recovery and obstruct future economic growth.

The current financial crisis is not--as some have said--a crisis of capitalism. It is in fact the opposite, a shattering demonstration that ill-considered government intervention in the private economy can have devastating consequences. The crisis has its roots in the U.S. government's efforts to increase homeownership, especially among minority and other underserved or low-income groups, and to do so through hidden financial subsidies rather than direct government expenditures. The story is an example, enlarged to an American scale, of the adverse results that flow from the misuse and manipu-lation of banking and credit by government. When this occurs in authoritarian regimes, we deride the outcome as a system of "policy loans" and note with an air of superiority that banks in these countries are weak, credit is limited, and financial crises are frequent. When the same thing happens in the United States, however, we blame "greedy" people, or poor regulation (or none), or credit default swaps, or anything else we can think of--except the government policies that got us into the disaster.

Cause and Effect - Economics - AEI

 

[dnsmith35]

Do you guys get that this whole 'why did the market crash' bickering has exactly nothing to do with the moral justification for wealth redistribution?

It has to do with government interference, much the same as excess taxation does.

 

[dblack]

Do you guys get that this whole 'why did the market crash' bickering has exactly nothing to do with the moral justification for wealth redistribution?

It has to do with government interference, much the same as excess taxation does.

yeah, but it's all arm wrestling over pragmatic concerns. Nothing at all to do with moral considerations.

 

[EdwardBaiamonte]

Do you guys get that this whole 'why did the market crash' bickering has exactly nothing to do with the moral justification for wealth redistribution?

It has to do with government interference, much the same as excess taxation does.

yeah, but it's all arm wrestling over pragmatic concerns. Nothing at all to do with moral considerations.

I think we can all agree the using govt to steal from others as libs do is immoral.

 

[dblack]

It has to do with government interference, much the same as excess taxation does.

yeah, but it's all arm wrestling over pragmatic concerns. Nothing at all to do with moral considerations.

I think we can all agree the using govt to steal from others as libs do is immoral.

We can?? Seems that's the principal matter of disagreement.

 

[Pete7469]

Yes... They are that stupid...

 

[EdwardBaiamonte]

yeah, but it's all arm wrestling over pragmatic concerns. Nothing at all to do with moral considerations.

I think we can all agree the using govt to steal from others as libs do is immoral.

We can?? Seems that's the principal matter of disagreement.

so then tell us how stealing from others is moral?

 

[dblack]

I think we can all agree the using govt to steal from others as libs do is immoral.

We can?? Seems that's the principal matter of disagreement.

so then tell us how stealing from others is moral?

I don't think it is. But it seems some here disagree.

 

[Toddsterpatriot]

On those where rates don;'t matter? Or those with the lowest sustained EFFECTIVE and marginal rates in 80+ years?


DEMAND creates jobs, demand is driven by those at the bottom, so yes, the payroll tax holiday, that not ONE GOPer opposed it's demise, would've saved jobs!

Weird how the ONLY tax increase the GOP was for, was one hitting the bottom 90% the hardest!

On those where rates don;'t matter?

Which are those?

Or those with the lowest sustained EFFECTIVE and marginal rates in 80+ years?

Some rates are lower than recently. Like capital gains.
Some are higher, like the top income tax brackets.
Do higher taxes ever cause jobs to be lost? Be honest.

DEMAND creates jobs, demand is driven by those at the bottom

Does raising taxes on business cause job loss? Cause business creation to shrink? Cause demand by the newly unemployed to shrink?

the payroll tax holiday, that not ONE GOPer opposed it's demise, would've saved jobs!

Bush's tax cuts saved the middle class more than the payroll tax holiday.

All a bunch of right wing garbage, I'm shocked.

Yes, capital gains were cut to 15% under Dubya, besides benefiting the MOST wealthy among US 9top 1/10th of 1% get over 50% of ALL dividends) , how does 20% it is today hurt job creation?


EFFECTIVE rates SUSTAINED haven't been this low since before the GOP great depression!!!

Marginal rates, heck even that socialist Reagan had the top rate at 50% for 6 years


NO RECENT TAX INCREASE HAS STUNTED GROWTH, PROOF? Look at Clinton's 1993 tax increases where he created 3 new brackets and took the top rate from 31% to 39.6%, the economy lost jobs right?

lol

Dubya's tax cuts benefited the RICHEST ($1+ MILLION ) the most, BUT that doesn't refute the FACT that NO ONE in the GOP fought to stop the payroll tax holiday from increasing, first time in decades the GOP supported increasing taxes, of course it hit those on the bottom 90% NOT those 'job creators'


CARTER HAD 9+ MILLION PRIVATE SECTOR JOBS GROWTH IN 4 YEARS VERSUS 14 MILLION FOR REAGAN'S 8

Jan 1979 65,636,000
Jan 1981 74,677,000

INCREASE OF 9,041,000 Total private IN 4 YEARS

Jan 1981 74,677,000
Jan 1989 89,394,000

14,717,00 Total private IN 8 YEARS

Bureau of Labor Statistics Data

YEAH, CUTTING TAXES CREATES JOBS *Shaking head*

top 1/10th of 1% get over 50% of ALL dividends)

This error was funny the last time you said it. Or is it a lie?

Marginal rates, heck even that socialist Reagan had the top rate at 50% for 6 years

There were a lot more loopholes and tax shelters as well.

Look at Clinton's 1993 tax increases

Now explain why taking more money from taxpayers creates jobs or increases growth.

Dubya's tax cuts benefited the RICHEST ($1+ MILLION ) the most

And benefited the middle class more than the SocSec "holiday".

CARTER HAD 9+ MILLION PRIVATE SECTOR JOBS GROWTH IN 4 YEARS

Makes you wonder why his misery index was so high?

 

[Toddsterpatriot]

Yes, 70% to 50% in 1981 AND the 50% rate was there until 1987. HOW DID THE US PROSPER AT 50% under Reagan? Or 70% under LBJ? Gaawwwddd forbid, Ike's 90%+ most have killed the US economuy right?

HOW DID THE US PROSPER AT 50% under Reagan?

Lots of economic activity that people didn't want to undertake at 70% was more attractive at 50%.

CARTER HAD 9+ MILLION PRIVATE SECTOR JOBS GROWTH IN 4 YEARS VERSUS 14 MILLION FOR REAGAN'S 8

Jan 1979 65,636,000
Jan 1981 74,677,000

INCREASE OF 9,041,000 Total private IN 4 YEARS

Jan 1981 74,677,000
Jan 1989 89,394,000

14,717,00 Total private IN 8 YEARS

Bureau of Labor Statistics Data

WHAT WERE YOU SAYING? Even though Reagan BLEW up spending that benefited the 'private sector' and he allowed the S&L crisis to expand as a bubble when he ignored regulator warnings that had started in 1984!!!

All that success and Carter could only carry 6 states? The people must not have believed he was any good.

 

[Dad2three]

On those where rates don;'t matter?

Which are those?

Or those with the lowest sustained EFFECTIVE and marginal rates in 80+ years?

Some rates are lower than recently. Like capital gains.
Some are higher, like the top income tax brackets.
Do higher taxes ever cause jobs to be lost? Be honest.

DEMAND creates jobs, demand is driven by those at the bottom

Does raising taxes on business cause job loss? Cause business creation to shrink? Cause demand by the newly unemployed to shrink?

the payroll tax holiday, that not ONE GOPer opposed it's demise, would've saved jobs!

Bush's tax cuts saved the middle class more than the payroll tax holiday.

All a bunch of right wing garbage, I'm shocked.

Yes, capital gains were cut to 15% under Dubya, besides benefiting the MOST wealthy among US 9top 1/10th of 1% get over 50% of ALL dividends) , how does 20% it is today hurt job creation?


EFFECTIVE rates SUSTAINED haven't been this low since before the GOP great depression!!!

Marginal rates, heck even that socialist Reagan had the top rate at 50% for 6 years


NO RECENT TAX INCREASE HAS STUNTED GROWTH, PROOF? Look at Clinton's 1993 tax increases where he created 3 new brackets and took the top rate from 31% to 39.6%, the economy lost jobs right?

lol

Dubya's tax cuts benefited the RICHEST ($1+ MILLION ) the most, BUT that doesn't refute the FACT that NO ONE in the GOP fought to stop the payroll tax holiday from increasing, first time in decades the GOP supported increasing taxes, of course it hit those on the bottom 90% NOT those 'job creators'


CARTER HAD 9+ MILLION PRIVATE SECTOR JOBS GROWTH IN 4 YEARS VERSUS 14 MILLION FOR REAGAN'S 8

Jan 1979 65,636,000
Jan 1981 74,677,000

INCREASE OF 9,041,000 Total private IN 4 YEARS

Jan 1981 74,677,000
Jan 1989 89,394,000

14,717,00 Total private IN 8 YEARS

Bureau of Labor Statistics Data

YEAH, CUTTING TAXES CREATES JOBS *Shaking head*

It looks like you are defending my comment that cutting taxes on the rich and corporations IS SUPPLY SIDE ECONOMICS, JUST LIKE WHAT JFK AND LBJ DID IN 1964. Thanks for the vote of confidence.

Sure, IF you don't use reason and logic I am

Carter INCREASE OF 9,041,000 Total private IN 4 YEARS
Reagan 14,717,00 Total private IN 8 YEARS

WOW, IF TAX CUTS CREATED JOBS, WHY DID CARTER CREATE A HIGHER PERCENTAGE THAN RONNIE, WHO TRIPLED THE DEBT?

 

[Dad2three]

Nope. They provide jobs and inexpensive consumer goods. Walmart enables millions of people to live better than they could otherwise. On the other hand, our socialist education system makes our population stupid, and does it at great cost.

And pay wages low enough to suck BILLIONS of fthe Gov't in WELFARE to survive, that's Walmart entire Biz model

OK, so the government should shut Walmart and McDonalds and all the other businesses like them down. Then what have you got? $10 hamburgers? $$60 shirts? Good for you. You have just thrown 3 to 5 million people out of work.

Yeah, because before Walmart and McD's we had $10 hamburgers and $60 shirts *shaking head*

 

[Pete7469]

HOW DID THE US PROSPER AT 50% under Reagan?

Lots of economic activity that people didn't want to undertake at 70% was more attractive at 50%.

CARTER HAD 9+ MILLION PRIVATE SECTOR JOBS GROWTH IN 4 YEARS VERSUS 14 MILLION FOR REAGAN'S 8

Jan 1979 65,636,000
Jan 1981 74,677,000

INCREASE OF 9,041,000 Total private IN 4 YEARS

Jan 1981 74,677,000
Jan 1989 89,394,000

14,717,00 Total private IN 8 YEARS

Bureau of Labor Statistics Data

WHAT WERE YOU SAYING? Even though Reagan BLEW up spending that benefited the 'private sector' and he allowed the S&L crisis to expand as a bubble when he ignored regulator warnings that had started in 1984!!!

All that success and Carter could only carry 6 states? The people must not have believed he was any good.

It boggles the mind how the moonbat messiah got re-elected...

Oh wait, the republicrats nominated a "moderate".

It makes sense now.

Sort of.

 

[Dad2three]

Are you really that stupid? The primary cause of the housing bubble was low interest used to push housing to more people who could not previously qualify. That started during Clinton's term and the inflation cycle started in 1997.

It is obvious you can't read a graph or you wouldn't make such stupid comments.

I did not say CRA CAUSED the bubble. I said it contributed to it because the concept of providing home ownership to more of the less wealthy. CRA was not enforced during Carter's administration even though that is when it was passed. Clinton was the one who STARTED to push more home ownership BECAUSE OF CRA, but it was the government policies of low interest, low or no down payments continued into Bush's administration which fueled the inflation because of the heated housing market which led to the balloon and subsequent crash. Lenders were not necessarily covered by CRA, but when Fannie and Freddie allowed lower lending standards (sub prime) they had to follow suit to stay in business, and that was part of the deregulation.

New Study Blames Community Reinvestment Act For Mortgage Defaults - Investors.com

Democrats and the media insist the Community Reinvestment Act, the anti-redlining law beefed up by President Clinton, had nothing to do with the subprime mortgage crisis and recession.

But a new study by the respected National Bureau of Economic Research finds, "Yes, it did. We find that adherence to that act led to riskier lending by banks."

Added NBER: "There is a clear pattern of increased defaults for loans made by these banks in quarters around the (CRA) exam. Moreover, the effects are larger for loans made within CRA tracts," or predominantly low-income and minority areas.​

Wait! Government did cause the housing bubble. - CSMonitor.com

In the 2000s, of course, malinvestment appeared largely in real estate, the result of government programs designed to relax underwriting standards and otherwise increase investment in particularly risky real-estate assets. In other words, ABCT tells us to look for malinvestment during the boom, but not where that malinvestment will show up.

Paul Krugman asserts, for example, that the “Community Reinvestment Act of 1977 was irrelevant to the subprime boom.” Actually, no. A new NBER paper (gated) on the CRA is causing quite a stir. Authored by four economists from NYU, MIT, Northwestern, and Chicago, the paper is the first to use instrumental-variables regression to distinguish changes in bank lending caused by the CRA from changes that would likely have happened anyway. (The authors use the timing of loan decisions relative to the dates of CRA audits to identify the effect of the CRA on lending.) The results suggest that CRA enforcement did, contra Krugman, lead banks to make substantially riskier loans than otherwise.

Rahan said, "“
The key then to understanding the recent crisis is to see why markets offered inordinate rewards for poor and risky decisions. Irrational exuberance played a part, but perhaps more important were the political forces distorting the markets. The tsunami of money directed by a US Congress, worried about growing income inequality, towards expanding low income housing, joined with the flood of foreign capital inflows to remove any discipline on home loans. And the willingness of the Fed to stay on hold until jobs came back, and indeed to infuse plentiful liquidity if ever the system got into trouble, eliminated any perceived cost to having an illiquid balance sheet."

I’d reverse the order of emphasis — credit expansion first, housing policy second — but Rajan is right that government intervention gets the blame all around.​

In other words Dad2three, you are looking at old guesses and opinions instead of the more recent ECONOMIC STUDIES which prove the typical left wing assertions were WRONG.

GAAAWWWWWDDD NOT THE ZOMBIE LIE

LOL


YEAH, A LAW AROUND FOR 30 YEARS AND WEAKENED ENFORCEMENT UNDER DUBYA, CAUSED A WORLD WIDE CREDIT BUBBLE, LOL

Yep! That law contributed to the problem as the more recent study proves. If you are not smart enough to recognize a legitimate study after the defensive sounds from the Fed, they you are too stupid to exist in this world. I don't have to try more, I have proved my point in spades, and you continue to parrot your left wing extremist propaganda.

SO YOU IGNORE THE STUDY THAT RIPPED THE AEI STUDY APART?


YEAH, A LAW AROUND FOR 30 YEARS AND WEAKENED ENFORCEMENT UNDER DUBYA, CAUSED A WORLD WIDE CREDIT BUBBLE, LOL

Debunking the CRA Myth – Again

One of the pernicious myths surrounding CRA is that it encouraged banks to make risky loans to low‐ and moderate‐income borrowers.

This argument has been made primarily by conservative think tanks, like American Enterprise Institute, who find it convenient to include CRA in their general position against governmental intervention in the private market.

But efforts to blame CRA for the most recent crisis reflect a deep misunderstanding of the scope and scale of CRA and its implementation. Indeed, the “blame the CRA” story has been refuted by industry leaders and researchers time and time again. Unfortunately, this narrative refuses to go away.


In this paper, center researchers review the research evidence on CRA and show that there is no credible research to support the assertion that CRA contributed to an increase in risky lending during the subprime boom. In particular, they present a detailed rebuttal of a recent paper published by the National Bureau of Economic Research, titled “Did the Community Reinvestment Act Lead to Risky Lending,” which purports to find evidence that “yes, it did.” The study is severely flawed, both in terms of the empirical analysis and in the authors’ interpretation of the results, and thus fails to contribute to the existing literature on both the strengths and weaknesses of CRA.

January 2013

UNC Center for Community Capital




Fannie & Freddie Mac & CRA didn’t cause the Mortgage Crisis



A study by the Joint Center for Housing Studies Harvard University on the Subprime Lending and the Community Reinvestment Act concluded that: data provided by the Home Mortgage Disclosure Act (HMDA) reveal that loans covered by the CRA accounted for only a fraction of mortgage lending to lower-income borrowers and neighborhood



Their data clearly shows that the vast majority (94%) of subprime lending was conducted by lenders outside of CRA scrutiny, and therefore under no government ‘coercion’ to lend to lower income and/or higher risk borrowers.


http://www.factandmyth.com/wp-content/uploads/2011/09/cra-assessment-image.gif

Fannie & Freddie Mac & CRA didn?t cause the Mortgage Crisis | Fact and Myth


US GOV'T POLICY HUH?


JUNE 16, 2005

The worldwide rise in house prices is the biggest bubble in history. Prepare for the economic pain when it pops


The global housing boom: In come the waves | The Economist


GROW A BRAIN!!!


According to estimates by The Economist, the total value of residential property in developed economies rose by more than $30 trillion over the past five years, to over $70 trillion, an increase equivalent to 100% of those countries' combined GDPs.

 

[Pete7469]

And pay wages low enough to suck BILLIONS of fthe Gov't in WELFARE to survive, that's Walmart entire Biz model

OK, so the government should shut Walmart and McDonalds and all the other businesses like them down. Then what have you got? $10 hamburgers? $$60 shirts? Good for you. You have just thrown 3 to 5 million people out of work.

Yeah, because before Walmart and McD's we had $10 hamburgers and $60 shirts *shaking head*

No, after WalMart and McD's we got $.05 burgers and $1 shirts because Sam Walton and other businessmen minimized profit margins in order to undercut competition.

Bolshevik parasites like you would have unions in every store, bread lines, shortages of toilet paper and a People's Commissariat for Internal Affairs "re-educating" people in "happy camps" (for the rest of their lives), but at least we'd all be equal right?

I'm disturbed you have reproduced.

 

[Pete7469]

GAAAWWWWWDDD NOT THE ZOMBIE LIE

LOL


YEAH, A LAW AROUND FOR 30 YEARS AND WEAKENED ENFORCEMENT UNDER DUBYA, CAUSED A WORLD WIDE CREDIT BUBBLE, LOL

Yep! That law contributed to the problem as the more recent study proves. If you are not smart enough to recognize a legitimate study after the defensive sounds from the Fed, they you are too stupid to exist in this world. I don't have to try more, I have proved my point in spades, and you continue to parrot your left wing extremist propaganda.

SO YOU IGNORE THE STUDY THAT RIPPED THE AEI STUDY APART?


YEAH, A LAW AROUND FOR 30 YEARS AND WEAKENED ENFORCEMENT UNDER DUBYA, CAUSED A WORLD WIDE CREDIT BUBBLE, LOL

Debunking the CRA Myth – Again

One of the pernicious myths surrounding CRA is that it encouraged banks to make risky loans to low‐ and moderate‐income borrowers.

This argument has been made primarily by conservative think tanks, like American Enterprise Institute, who find it convenient to include CRA in their general position against governmental intervention in the private market.

But efforts to blame CRA for the most recent crisis reflect a deep misunderstanding of the scope and scale of CRA and its implementation. Indeed, the “blame the CRA” story has been refuted by industry leaders and researchers time and time again. Unfortunately, this narrative refuses to go away.


In this paper, center researchers review the research evidence on CRA and show that there is no credible research to support the assertion that CRA contributed to an increase in risky lending during the subprime boom. In particular, they present a detailed rebuttal of a recent paper published by the National Bureau of Economic Research, titled “Did the Community Reinvestment Act Lead to Risky Lending,” which purports to find evidence that “yes, it did.” The study is severely flawed, both in terms of the empirical analysis and in the authors’ interpretation of the results, and thus fails to contribute to the existing literature on both the strengths and weaknesses of CRA.

January 2013

UNC Center for Community Capital




Fannie & Freddie Mac & CRA didn’t cause the Mortgage Crisis



A study by the Joint Center for Housing Studies Harvard University on the Subprime Lending and the Community Reinvestment Act concluded that: data provided by the Home Mortgage Disclosure Act (HMDA) reveal that loans covered by the CRA accounted for only a fraction of mortgage lending to lower-income borrowers and neighborhood



Their data clearly shows that the vast majority (94%) of subprime lending was conducted by lenders outside of CRA scrutiny, and therefore under no government ‘coercion’ to lend to lower income and/or higher risk borrowers.


http://www.factandmyth.com/wp-content/uploads/2011/09/cra-assessment-image.gif

Fannie & Freddie Mac & CRA didn?t cause the Mortgage Crisis | Fact and Myth


US GOV'T POLICY HUH?


JUNE 16, 2005

The worldwide rise in house prices is the biggest bubble in history. Prepare for the economic pain when it pops


The global housing boom: In come the waves | The Economist


GROW A BRAIN!!!


According to estimates by The Economist, the total value of residential property in developed economies rose by more than $30 trillion over the past five years, to over $70 trillion, an increase equivalent to 100% of those countries' combined GDPs.

Oh... right...

The Ecommunist...


That's not a leftist rag...


Get a grip bed wetter.