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Obama On Lending

This article first appeared on Dec 15, 2009.

In one interview with CBS, the President states that he was not elected to help "fat-cat bankers" when over the same weekend he is calling banking industry executives to the White House exhorting them to increase lending.  This from the same President who has been blaming all economic ills on his predecessor who was in office during times of "unrestrained risky lending".
 
Apparently, there is no limit to hubris.
 
Banks are being demanded to make more loans in an environment where there are fewer and fewer qualified borrowers.  Rational Americans and American businesses are controlling their expenditures, paying down their debt, and building cash reserves.  Americans and businesses already struggling with issues of credit and cashflow are so tapped out that they represent defaults-in-waiting already. 
 
To whom would the President like banks to lend?  Federal regulations that forced and later reinsured lending to borrowers who could not have qualified under reasonable, historical underwriting guidelines was a major impetus for our current economic troubles.  (For those confused – that would be legislation like the Carter-era CRA, later amended and extended under Clinton – which replaced legitimate underwriting guidelines with quotas and threats mandating lending to "underserved areas".  Make no mistake – it was these legislations followed up by later government policies that create the "credit-swap" and derative markets which banks utilized to make these types of loans profitable.  Without these markets to insure these unqualified loans, no bank would have ever made them! 
 
So we can ask again, Mr. President, to whom would you like these banks to lend?  Those who are "credit-worthy" are so and are taking action to remain so.  They are not borrowing.  (Facing enormous increases in taxes and regulatory costs – with Health Care Reform, Cap-And-Trade, Increased Taxes upcoming due to the expiration of the Bush tax cuts, and the daily growing list of redistributionist schemes that his administration is driving – they are not growing their businesses either!  Gee, maybe that is why the only thing this administration can point to on "job creation" is their faked and made-up statistics touting jobs "not lost"!)  
 
Maybe if the President seeks a growing economy that promotes job growth, he should quit investing his time collecting unearned peace prizes, giving speeches to proponents of enviro-fraud, and nationalizing entire segments of our economy.  Maybe he should quit lecturing business leaders on how to grow businesses and simply get out of their way letting them do what they have done for hundreds of years in our capitalist system which is promote economic growth and build a system that has produced more success for more people than other in the history of this planet! 
 
Frankly, most of these leaders that he deems himself qualified to lecture were building companies and building markets at the same time when he was organizing protests. 

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