Posted by
Duane Bolick on Monday, October 27, 2008 1:24:26 AM
Under Clinton, responsible lenders were accused of discriminatory practices, such as "profiling," and "redlining." Clinton's own pitbull (sans lipstick), Janet Reno, threatened U.S. Justice Department investigations of lenders who didn't ignore their statistically-based, time-proven lending criteria. So they did what Democrats forced them to do and loaned money to people who might not be able to pay it back.
When the failure of a critical mass of those people to pay back the money these beleaguered financial institutions loaned them under duress caused a worldwide economic meltdown, Democrats claimed it was the greed of the lenders (not the fact that they, themselves, had threatened them to lend, "or else") that caused the problem.
So, now, lenders are being more cautious about who they lend money to. Even credit card companies are reticent about handing out credit cards, and some have started to reduce credit limits of their existing customers. This is a good thing, right?
Not according to NPR: Their spin on a resurgence of responsible lending practices is that these companies (who have been burned twice already) are, 'engaging in credit-line profiling.' (Emphasis mine.)
This is a partial transcript of a NPR story from today about this horrible practice of "predatory responsible lending":
Dennis Perry lives in Lacome, Louisiana ... At the beginning of this year, he had a credit card with a $40,000 limit. Then he says it was cut to just above what he owed:
"And then I paid it down to about $32,000 and they dropped my credit limit again, to $33,200 now, this time."
Perry says the company told him it didn't want him to get into trouble. But he feels like he's just being 'chased down.':
"Lemme ask you this: What is my incentive to pay down my credit card now? If I make extra payments to bring down my balance, what's going to happen? They're going to penalize me by, um, dropping my maximum! You know what I mean?"
Consumer advocates say that this practice of 'following customers down' as they trim their balances is unfair.
I don't know anything about Perry, except what he said in this brief interview. But based on his understanding of economic "incentive," I wouldn't loan him a dollar! If the fact that he borrowed money that he agreed to pay back isn't incentive enough to, well, pay it back, then I pity the people he owes!
This NPR story tries to make credit card companies look like the bad guys for lowering credit limits, and making rational judgments about extending credit, calling it "credit profiling." How far behind can accusations of "racial-credit-profiling" be? How long before these lenders are called "predatory non-lenders?" Let's take a look at the Democrat "narrative" on lending in recent history:
1993: "You're not lending money to these people, and it's because you're racist. Lend money to them or we'll 'investigate' and legislate you into the ground. Your intolerance is causing so much suffering!"
2003-4: "There's nothing wrong with our system of lending money to those who those intolerant, short-sighted lending institutions wouldn't lend to. It's all sound."
2005-6: "Why are you so worried? There's nothing wrong with our government influence on the lending market! Who cares that nobody's seen their books in decades? We trust them!"
Mid 2008, post Fannie-Mae/Freddie-Mac meltdown: "You're so greedy, for lending money to these poor people who couldn't pay you back! Your greed caused all our problems!"
Now: "Why aren't you lending money to people? You're profiling based on credit-worthiness! How non-progressive of you!"
Seriously? We've been through this, we know how it ends, and we're still, in fact, dealing with the consequences! We haven't even had enough time to fix the problems that Democrats have caused, and already, the fringe media is crying, "Discrimination! More credit!"
I understand that history, for most libs, begins "this morning," but this is ridiculous, even by their own standards.