A Government-Made Recession

By mid 2008 almost everybody knew that we were in deep financial trouble. But the forces that brought it about actually began decades ago with The Community Reinvestment Act in 1977. This legislation “forced lending institutions to grant mortgages to people whose income, credit histories, and net worth would previously have disqualified them from getting such loans.”

An old adage suggests that in getting a loan from a bank the recipient must first prove that he does not need one by listing his assets. The bank uses this list to retrieve all or a portion of what is owed should the recipient default on the loan. The less invested or potentially lost the easier it is for the recipient to walk or default. Such is long standing wisdom and favors the more industrious individuals, as it should. What this means in real life is that high crime or impoverished areas of town do not attract investors as readily.

Socialists (share the wealth advocates) saw a race connection, thus injustice, when it was realized that “only 72 percent of minority applicants were approved for mortgages, versus 89 percent of white applicants.” Moral outrage followed which was resolved by legislation ”forcing lending institutions to loan money to people they would otherwise not lend to and in places where they would otherwise not put their money” (“Government Bailout,” The New American, Sept. 29, 2008, pp.11-15).


The Paternal Power

I’m sure most people remember how free they felt the day the left home and lived on their own. At first it might have seemed a bit scary because you had to pay bills and survive independently of your parents but after a while you felt a new sense of freedom in your own life. You may not have realized this but what you did is that you have freed yourself from the paternal power of your parents.

The paternal power that your parents had was well established since you were born because they had to take care of you. While they were taking care of you you were dependent on them and this gave your parents a sense of power over your being. This is why your parents believe they have a right to control what you do with your life while they are taking care of you and the expression ‘under my house…blah…blah…blah’ exist.

The one thing that many political philosophers such as John Locke were dealing with at the time was the paternal power of the state. Monarchs were not magistrates who executed the law but seen as parents who assumed they had control over you in the same way a parent does over a child. The king was responsible for your welfare and survival which turned each citizen into a personal ward of the king. This established the same relationship you had with your parents when you lived with them between the king and society.