Community Reinvestment Act

A study by the University of Minnesota Institute on Race and Poverty has found that the racial disparities in in mortgage lending in the Twin Cities are among the worst in the nation. And contrary to Republican talking points on the mortgage crisis, the report says that an expansion of the Community Reinvestment Act would [...]

In a speech last week John Dugan, comptroller of the currency, issued a strong defense of the Community Reinvestment Act — a direct response to CRA critics such as U.S. Rep. Michele Bachmann, R-Minn., who have laid blame for the current housing crisis on anti-redlining legislation.

Conservative columnists, pundits, bankers, and politicians like Minnesota’s own Michele Bachmann have taken to blaming the subprime fallout and subsequent credit crisis on the Carter-era Community Reinvestment Act. But housing and civil-rights experts say they’re just plain wrong. And if Minneapolis doesn’t take steps to fix the problem soon, things will get a lot worse.

Rep. Michele Bachmann is facing increasing heat for repeated statements tying the banking crisis to a 30-year-old law that addressed the racist practice of redlining by lenders. Her statements led to sharp criticism from fellow Minnesota Rep. Keith Ellison and her political opponents, and resulted in Bachmann’s being forced to defend her statements as non-racist.

Everyone with a soapbox has spent the better part of this week pointing fingers at who is to blame for the emerging economic crisis stemming from the default of millions of subprime mortgages. One direction that conservatives, Republicans and bankers are pointing their fingers is at the Community Reinvestment Act of 1977 (CRA) — a law created to counter the discriminatory practice mortgage banks used for decades to single out minority neighborhoods for subprime mortgages or otherwise deny credit-worthy individuals access to capital simply because of the color of their skin and their neighbors. Vociferously leading the charge is Minnesota’s own Rep. Michele Bachmann.