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Source link: http://archive.mises.org/12888/former-hud-chief-blames-housing-meltdown-on-%e2%80%9cunscrupulous-interests%e2%80%9d/

Former HUD chief blames housing meltdown on “unscrupulous interests”

June 3, 2010 by

Henry Cisneros says government’s push to increase home ownership had nothing to do with the crash. The only thing government did wrong is that it didn’t regulate enough, Cisneros told a crowd of 50 at the Hilton Hotel in Austin. It was not reported how many were able to keep a straight face.

{ 20 comments }

Walt D. June 3, 2010 at 6:04 pm

“The only thing government did wrong is that it didn’t regulate enough”. Wrong -this keeps coming up. There is a difference between more regulation and good (or effective) regulation. The problem is that it is very difficult for government regulatory agencies to find people who are competent to regulate. The usual canard is to claim that the regulators would have done a competent job except that the were paid off – that Barney Frank and Chris Dodd would have done what needed to be done is they had been distracted by campaign contributions. Do we really expect Barbara Boxer, whose financial acumen does not extend to balancing her own checkbook, to be able to regulate anything? In the BP oil spill, does anyone in the government have any knowledge of the problems associated with drilling in 5000 ft of water? (Dick Cheney might have some industry connections with some know-how, but they do not work for a government regulatory agency.)

Seattle June 3, 2010 at 8:33 pm

The problem is that it is very difficult for government regulatory agencies to find people who are competent to regulate.

Interventions always destroy wealth, no matter what those interventions are. The only thing the state can do to truly aid the market is to leave it alone.

Shay June 4, 2010 at 9:39 am

The planet Mars is a good role-model for helping the free market: get back and leave it the **** alone.

Daniel June 3, 2010 at 8:52 pm

The idea behind regulating loans is a priori silly. Since a knowing “good” loan implies a return on said loan, a true regulator would simply become an investor where who could gain much more than being a “regulator” of said loans

Braden June 3, 2010 at 7:06 pm

How long are we going to trust the regulators that tell us regulation wasn’t the problem? It reminds me of an old Colbert skit, ironically, where he and Steve Carell were arguing about whether the Koran or Bible were true and using the Koran and Bible to prove their truth.

Bruce Koerber June 3, 2010 at 7:46 pm

There is no doubt that the housing meltdown was caused by “unscrupulous interests.” I think I just found a synonym for ego-driven interventionism!

In addition to being an ego-driven interventionist Henry Cisneros is ignorant of economic theory and relies on the ego-driven interpretation of the Keynesian quacks!

Magnus June 3, 2010 at 7:54 pm

Government is based on lies. It trades on lies. It couldn’t function without lies. Government is in the lying business, and business is good.

Dave Albin June 3, 2010 at 8:06 pm

Mr. Cisneros – why is encouraging people to buy homes they can’t afford a good policy? You can’t create the middle class, no matter how hard you try. You can only destroy it.

Ohhh Henry June 3, 2010 at 9:57 pm

Unscrupulous interests? I should say yes.

Catherine Austin Fitts, former Assistant Secretary of Housing and Federal Housing Commissioner at HUD, wrote the following:

I met with a senior staff assistant to the Chairman of one of the appropriations committees for HUD. When I asked what was going on at HUD, the staff assistant said, “HUD is being run as a criminal enterprise.”

Link.

Chris Streeter June 4, 2010 at 12:56 am

That’s like saying overfeeding the hogs didn’t make them fat. How do you get your head around that kind of logic?

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Karie June 4, 2010 at 8:17 am

Mr Cisneros is probably living in his mansion sipping brandy during the evening discussing high level economics and is just so far removed from life that he could not ever attempt to respond to such a question in an intelligent manner.

Vanmind June 4, 2010 at 9:36 am

Sure, people who strive to peddle imaginary concepts are capable only of imaginary analysis.

Frank Gimsdale June 4, 2010 at 4:24 pm

Years ago I worked for a large consultancy and part of my job was assisting businesses with root cause analysis in figuring out why something failed. They payed us a good sum of money to do this analysis and would always tell us they wanted the absolute truth. When I was young and naive, I believed this was what they were after, but I soon learned that what they really wanted was for us to justify their actions and blame the problem on external factors that were beyond their control. While we never outright lied, we did spend a considerable amount of time trying to determine the best way in which to frame our conclusions as not to offend management, even if they were not the ones paying for the report. There are lots of consulting firms out there like the company I worked for that feed businesses and governments with analysis designed to mislead or obfuscate the truth. We had a partner that use to tell us that the truth can be what ever you want it to be with enough well placed words.

Bruce Koerber June 5, 2010 at 8:55 am

Ethical Economics Education Is Essential!!!

“There are lots of consulting firms out there like the company I worked for that feed businesses and governments with analysis designed to mislead or obfuscate the truth. We had a partner that use to tell us that the truth can be what ever you want it to be with enough well placed words.”

What you describe is a hampered economy that is rigged to serve the State rather than an unhampered market economy that simply serves to faciltate the subjective choices of humans at the societal level and at the world level.

What you describe is a cumulative burden of unethical practices piled on top of empirical and ego-driven interpretation of the economy which is completely severed from any concept of ethical economics.

Certainly the resolution of this ‘disease’ is a greater understanding of ethical economics. Therefore a greater understanding of ethical economics is of major importance in the scientific community and in the real world.

Annie, Pirate Wench August 10, 2010 at 10:23 am

The ignorance of this administration is amazing.

Deborah Johnson September 17, 2010 at 3:45 pm

HUD is a discriminatory housing management program, which is backed by the federal goverment.It is evident it its housing practices. Being human should be the only criteria for decent and affordable housing.It is discrimination to exclude those with bad credit because bad credit usually means no funds. There are many citizens that have carried the financial burden for those who are said to have good credit.A prime example would be us mothers that have taken care of our children without proper child support. I am owe 31,000 dollars in child support payments. It is my belief that others parents with outsanding child support owe too them should be allowed housing through HUD before anyone,or the State of Maryland should enforce child support payments to be made in full.
The State of Maryland do not enforce child support payments from absence parents unless it is a parent that is productive with much too lose. Why is it that the parents that are either jailed, or on drugs are not force to pay. There are many fathers that are in jail that are not being payed decent wages for there labor. These men should be payed in order that they pay their debts to their offsprings. Drug addiction has been labled a sickness.
Drug addiction as a sickness is a disablity,and therefore the offsprings of these addicts should received disablity payments from the state.Many citizen sit back, while these discriminatory practices happen,and seem not to understand the reason for crime. Well let me share with you my sleep friends, when you treat people like animals they usually act like animals.
No one can hide from crime any longer because we have set back allow children to play with “toy guns” and now that have learn to use them efficiently. These children have learned that if you are living in poverty then it would be better to rob someone that is not.

Deborah Johnson September 17, 2010 at 3:56 pm

HUD is a discriminatory housing management program, which is backed by the federal goverment.It is evident it its housing practices. Being human should be the only criteria for decent and affordable housing.It is discrimination to exclude those with bad credit because bad credit usually means no funds.
There are many citizens that have carried the financial burden for those who are said to have good credit. A prime example would be us mothers that have taken care of our children without proper child support. I am owe 31,000 dollars in child support payments. It is my belief that others parents with outsanding child support owe too them should be allowed housing through HUD before anyone,or the State of Maryland should enforce child support payments to be made in full.
The State of Maryland do not enforce child support payments from absence parents unless it is a parent that is productive with much too lose. Why is it that the parents that are either jailed, or on drugs are not force to pay.
There are many fathers that are in jail that are not being payed decent wages for there labor. These men should be payed in order that they pay their debts to their offsprings. Drug addiction has been labled a sickness.
Drug addiction as a sickness is a disablity,and therefore the offsprings of these addicts should received disablity payments from the state.Many citizen sit back, while these discriminatory practices happen,and seem not to understand the reason for crime.
Well let me share with you my sleep friends, when you treat people like animals they usually act like animals.
No one can hide from crime any longer because we have set back allow children to play with “toy guns” and now that have learn to use them efficiently.
These children have learned that if you are living in poverty then it would be better to rob someone that is not. After these children commit crimes the state want to kill them, although parent are not allowed to kick their behines.

Smoking Electronic Cigarette January 23, 2011 at 1:09 am

I agree with you, unscrupulous interests played a big roll on the housing meltdown. I am very optimistic that soon things will begging to pick up time will tell.

Mike Seebinger March 25, 2011 at 5:48 pm

The Federal Reserve is an independent agency that determines fiscal policy and some folks feel strongly that it has taken part in ruining the economy of the United States so these comments don’t surprise me.

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