The Banks wanted to be able to lend more money to people that weren't currently able to be federally insured. The banks pushed for that bill in fact they wrote the freaking thing and paid off three Republicans to sponsor it in the House & Senate. I really wish you would quit repeating BS lies claiming "they were "forced" to lend to these people.. No one forced anyone they pushed for the bill. They wanted to lend to people that were more risky, however they didn't want to do it unless it was federally insured to cover their asses.
That's pure spin. Glass-Stegall would not have been repealed without the concurrence and complicity of the Democrats.
From Wiki but it is a matter of record. The Dems required "improvements" to the CRA in return for their support of Gramm-Leach-Bliley; they got their "improvements and the bill passed.
"After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. Democrats agreed to support the bill only after Republicans agreed to strengthen provisions of the Community Reinvestment Act "
Now to the CRA itself.
http://article.nationalreview.com/?q=Mzk3MzFiYWY3NjUyNzUyNzA4MzYzNTk2ZDVhMDFiMWE="Much more problematic than Gramm-Leach-Bliley is the Community Reinvestment Act, a bit of legislative arm-twisting much beloved by Sen. Obama and his fellow Democrats. One of the reasons so many bad mortgage loans were made in the first place is that Barack Obama’s celebrated community organizers make their careers out of forcing banks to do so. ACORN, for which Obama worked, is one of many left-wing organizations that spent decades pressuring banks and bank regulators to do more to make mortgages available to people without much in the way of income, assets, or credit. These campaigns often were couched in racially inflammatory terms. The result was the Community Reinvestment Act. The CRA empowers the FDIC and other banking regulators to punish those banks which do not lend to the poor and minorities at the level that Obama’s fellow community organizers would like. Among other things, mergers and acquisitions can be blocked if CRA inquisitors are not satisfied that their demands — which are political demands — have been met. There is a name for loans made to people who do not have the credit, assets, income, or down payment to qualify for a normal mortgage: subprime.
The bankers cannot blame CRA entirely; they made a lot of bad bets on rising home prices. But CRA did influence lending standards across the banking industry, even in those institutions that are not strictly liable to its jurisdiction. The subprime debacle is in no trivial part the result of lending decisions in which political extortion trumped businesses’ normal bottom-line concerns."
Sadly, the CRA did result in political demands which were met by lenders and led us to where we are right now.
At least be honest about this. It took both parties to screw this up and they did a magnificent job together on that.
