It was a beautiful, clear, January morning in St. Petersburg, except for the buzz from the Helicopters. At least a half dozen swarmed over a nearby southside neighborhood. It was a bad sign, news and law enforcement choppers, all watching something below. Traffic accidents on nearby I-275 were the usual explanation. But on this day, two cops were already dead and a third badly injured.
Two officers had knocked on the door of a modest home, “we’re looking for Hydra.” They were there to arrest Hydra Lacy. If you recognize the Lacy name, it’s because his brother, Jeff, was a champion boxer. Hydra had failed to show for his domestic violence trial and faced 10 to 30 years if convicted. No one had seen him in weeks, but based on history, Officers Jeff Yaslowitz and Tom Baitinger knew where to find him.
Although Hydra had a long and sometimes violent criminal record, his life had settled down. He held a truck driving job, hosted backyard bar-b-ques, and married. It was that rocky marriage that again brought him into the arms of the judicial system. His wife, an ugly beast of a woman who wouldn’t hesitate to grab a knife or throw a punch herself, quietly told them that “he’s in the attic.”
The lead officer ordered Hydra to come down. Hydra had told everyone that he wasn’t going back to jail and so let fly a torrent of bullets that rained down on the officers. A nearby U.S. Marshall raced to the scene, responding to the officer’s final words, a call for backup. He tried to help his two fallen comrades, and took two rounds before retreating. Thankfully, he lived. Next came the SWAT team who indiscriminately aerated the attic with a thorough lead barrage. After several hours of quiet, they called in a bulldozer. It knocked the house to the ground, finally revealing the dead, well perforated, Lacy.
A terrible story, but it didn’t have to end this way. As usual, we can blame the Democrats.
Before Hydra rode that final downward spiral, his life looked pretty good. He had a job and owned his own home, his first, that he purchased in 2004. In fact, he owned seven houses. As reported by the Bradenton Herald:
Between 2004 and 2007, when credit was easy to come by, the Lacys bought seven houses, often paying top dollar. By 2009, they were in default on all but one: the house on 28th Avenue S. The two had refinanced in 2006 and Lacy added Christine’s name to the deed.
Dear Reader, at this point you should ask, “why did an ex-felon with a modest income own seven, S-E-V-E-N, houses?” The answer? The government ordered banks to grant mortgages to minorities, whether they could afford it or not. Banks could not ask about assets nor income, they couldn’t use credit scores. Banks that didn’t meet the increased minority mortgage quota would suffer the wrath of government regulators.
The mid 2000’s housing bubble was caused by an explosion of demand, juiced by low interest rates and no qualification loans. Soon, everyone wanted to get in on the meteoric rise in values. People with nothing borrowed money to buy houses they couldn’t afford. They were confident that a year later they could cash out $100,000 in equity on a refi or second mortgage, and … buy two more houses. Hispanic housekeepers in California making $10 per hour were “qualified” for $500,000 mortgages. It was only a slight variation on the old pyramid scheme.
The enabling mechanism was the Community Redevelopment Act, the CRA. It began, as many things do, with good (on surface) intentions back in the 1970’s. For many reasons, minorities had a difficult time securing loans and purchasing homes. But like most government programs, every virtue signaling politician wants to show that they “care more,” and over time the program metastasizes until it transcends reality. It becomes a caricature, a centrally planned Soviet style cure that is worse than the disease. Clinton’s housing secretary, Andrew Cuomo (yes, that Cuomo, the Me Too Senior Covid Killer Governor of New York), set a new goal in 1999 that banks had to source more than 50% of new mortgages with minorities. Even left leaning Wikipedia lets a little truth slip:
During Cuomo’s tenure as HUD Secretary, he called for an increase in home ownership. He also pushed government-sponsored lenders Fannie Mae and Freddie Mac to buy more home loans issued to poor homeowners in an attempt to end discrimination against minorities. Some believe that this helped lead to the 2007–2010 subprime mortgage crisis. Edward J. Pinto, former chief credit officer at Fannie Mae, said: “They should have known the risks were large.” Cuomo was pushing mortgage bankers to make loans and basically saying you have to offer a loan to everybody.”
The problem with Cuomo’s arbitrary and politically self-serving quota? There were not enough qualified minority borrowers to meet it. So, banks lowered credit standards and outsourced the now dirty business of mortgage origination, giving birth to “predatory lenders.” The Railer doesn’t like that term, because it implies that the financial industry were the predators. Nope. Our liberal coastal elites created predatory lenders and loosed them on minority communities.
By the 2000’s, there weren’t any standards.
The regulators charged with enforcing the CRA praised the lowering of down payments and even their elimination. They told banks that lending standards that exceeded that of regulators would be considered evidence of unfair lending. This effectively meant that no money down mortgages were required.
If you apply standards – you’re a racist.
Hydra Lacy bought into the dream. He could become a real-estate tycoon, the black Donald Trump. When he wanted to buy another home, the banks said yes, yes, yes. But when the bubble popped, Lacy’s mini-empire imploded. On top of whatever problems Hydra Lacy had in the past, losing everything in the housing bust was another bitter pill to swallow. One can barely imagine his frustration and despair. There is little doubt that it started the tragic chain of events that left himself and two officers dead just a couple years later.
Minorities weren’t the only ones ruined in the bust. Whites buying homes in poor communities could play the same game. The Railer knew a young white couple, both airline flight attendants, who accumulated 20 properties through the 2000’s. Why did a couple, who together earned less than $100K a year, mortgage millions of dollars in real estate? Who let them do that? Blame the same don’t ask don’t tell lending rules. They too lost everything, and more.
But they were the exception as the housing bust toll fell hardest on minorities. They were the most enthusiastic borrowers and had the least equity and income to back it up. They disproportionately ended up in foreclosure when the bubble burst. Studies showed blacks lost 61% of their net worth between 2005 and 2009, while whites lost much less, 21%. Whites suffered too but they had less to lose. With more equity and income, less leverage, whites rode out the storm and were more likely to keep their homes.
So what does Biden have to do with all of this? We’re hearing new Cuomo-esque missives from DimJoe and his far left Komrades. They say that we need to do more to promote home ownership and extend lending to minority borrowers. Sound familiar? DimJoe just won a Supreme Court case that lets him fire the Trump appointee responsibly helming the Federal Housing Finance Agency, our top mortgage regulator. Here are the lead paragraphs of a story that should evoke a sense of déjà vu.
WASHINGTON — President Joe Biden’s move to fire the top U.S. mortgage regulator is triggering calls from fellow Democrats to use the agency to expand access to loans for lower-income people, who have struggled to buy homes since the financial crisis…
The pressure from the left poses a tough choice for Biden. Democrats for years have pushed the agency responsible for Fannie and Freddie to expand homeownership and narrow the racial wealth gap. But making mortgages cheaper and more accessible could also raise the risks of defaults and increase the odds that the companies would need another bailout in the future. Fannie and Freddie were seized by the government in 2008 to avert their failure during the subprime mortgage crash.
Insanity is doing the same thing over and over and expecting different results. Democrats and their CRA wiped out more than half the lifetime wealth of black Americans a mere decade ago. Decades of economic progress, declining gaps with white Americans – erased seemingly overnight. Dems are ready to do it again. Are they smart-plus-evil or just dumb? Dems always say they’re the smartest people in the room. They have advanced degrees from Hah-vud, Ca-lumbiahh, and Burrrkleee, so The Railer’s gonna run with the evil hypothesis. They’ve added the words “equity,” and “affordable housing” to their oils, but it’s the same poison.
In 2012, then VP DimJoe Biden famously said to a black Virginia audience “unchain Wall Street (cue grand hand gesture and pregnant pause ) … they’re (the Republicans) gonna put y’all back in chains.” Really Dimjoe? Democrats owned the chains from the days of slavery, through the KKK, through Jim Crow, and like a drug dealer, Dems enticed minorities into a mortgage fraud that ended in their universal ruin. Democrat “help” threw millions of American minorities back into the chains of poverty.
Ronald Reagan famously said “The nine most terrifying words in the English language are: I’m from the Government, and I’m here to help.” Well, America, how’s that help workin’ out for ya? With the ‘rats controlling all of Washington’s power levers, there’s a lot more “help” coming.