Michelle Malkin » Kill the bailout: Illegal immigration and the mortgage mess

Kill the bailout: Illegal immigration and the mortgage mess

By Michelle Malkin • September 24, 2008 07:49 AM

My syndicated column today tackles the bailout angle no one wants to talk about: Open borders and the home loan debacle. You’ve heard a lot about Fannie/Freddie and the minority lending shakedowns, but you haven’t heard most commentators/analysts on either the left or the right talk about the massive illegal alien mortgage racket — a topic I’ve reported on for the past five years. That’s because fault lies at the feet of the crime-enabling banking industry and the ethnic lobbyists and the illegal alien-enabling Bush administration.

They screwed us. Now, they want us to fork over a trillion dollars.

Screw them.

Kill this bailout.

And I second Mark Krikorian: Credit is not a civil right. It’s not a civil right for illegal aliens. For foreign banks. For American banks. For anyone. The bailout proposal, as I noted earlier, now includes student loans and auto loan debt. Will our tax dollars next cover foreign student loan debts? Illegal alien in-state discounted college tuition debt? Where and when will it end?

Oh, but pardon me. I’m just being, you know, an ideological purist.

***

Illegal immigration and the mortgage mess
by Michelle Malkin
Creators Syndicate
Copyright 2008

The Mother of All Bailouts has many fathers. As panicked politicians prepare to fork over a trillion dollars in taxpayer funding to rescue the financial industry, they’ve fingered regulation, deregulation, Fannie Mae and Freddie Mac, the Community Reinvestment Act, Jimmy Carter, Bill Clinton, both Bushes, greedy banks, greedy borrowers, greedy short-sellers, and minority home ownership mau-mauers (can’t call ‘em greedy, that would be racist) for blame.

But there’s one giant paternal elephant in the room that has slipped notice: How illegal immigration, crime-enabling banks, and open-borders Bush policies fueled the mortgage crisis.

It’s no coincidence that most of the areas hardest hit by the foreclosure wave – Loudon County, Virginia, California’s Inland Empire, Stockton, San Joaquin Valley, Las Vegas, and Phoenix, for starters — also happen to be some of the nation’s largest illegal alien sanctuaries. Half of the mortgages to Hispanics are subprime (the accursed species of loan to borrowers with the shadiest credit histories). A quarter of all those subprime loans are in default and foreclosure.

Regional reports across the country have decried the subprime meltdown’s impact on illegal immigrant “victims.” A July report showed that in seven of the 10 metro areas with the highest foreclosure rates, Hispanics represented at least one-third of the population; in two of those areas – Merced and Salinas-Monterey, Calif. – Hispanics comprised half the population. The amnesty-promoting National Council of La Raza and its Development Fund have received millions in federal funds to “counsel” their constituents on obtaining mortgages with little to no money down; the group almost succeeded in attaching a $10 million earmark for itself in one of the housing bills past this spring.

For the last five years, I’ve reported on the rapidly expanding illegal alien home loan racket. The top banks clamoring for their handouts as their profits plummet, led by Wachovia and Bank of America, launched aggressive campaigns to woo illegal alien homebuyers. The quasi-governmental Wisconsin Housing and Economic Development Authority jumped in to guarantee home loans to illegal immigrants. The Washington Post noted, almost as an afterthought in a 2005 report: “Hispanics, the nation’s fastest-growing major ethnic or racial group, have been courted aggressively by real estate agents, mortgage brokers and programs for first-time buyers that offer help with closing costs. Ads proclaim: “Sin verificacion de ingresos ! Sin verificacion de documento !” — which loosely translates as, ‘Income tax forms are not required, nor are immigration papers.’”

In addition, fraudsters have engaged in massive house-flipping rings using illegal aliens as straw buyers. Among many examples cited by the FBI: a conspiracy in Las Vegas involving a former Nevada First Residential Mortgage Company branch manager who directed loan officers and processors in the origination of 233 fraudulent Federal Housing Authority loans valued at over $25 million. The defrauders manufactured and submitted false employment and income documentation for borrowers; most were illegal immigrants from Mexico. To date, the FBI reported, “58 loans with a total value of $6.2 million have gone into default, with a loss to the Housing and Urban Development Department of over $1.9 million.”

It’s the tip of the iceberg. Thanks to lax Bush administration-approved policies allowing illegal aliens to use “matricula consular cards” and taxpayer identification numbers to open bank accounts, more forms of mortgage fraud have burgeoned. Moneylenders still have no access to a verification system to check Social Security numbers before approving loans. In an interview about rampant illegal alien home loan fraud, a spokeswoman for the U.S. General Accounting Office told me five years ago:

“[C]onsidering the size of Los Angeles, New York, Chicago, Houston, and other large cities throughout the United States known to be inundated with illegal aliens, I don’t think the federal government is willing to expose this problem for financial reasons as well as for fear of political repercussions.”

Chickens coming home to roost. And law-abiding, responsible taxpayers are going to pay for it.

Posted in: 2008 campaign, Immigration, Subprime crisis

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#467608

On September 24th, 2008 at 5:04 pm, Netfest said:

OBAMA’S KATRINA
President Bush was hung from the media tree for flying over Katrina post-hurricane.

This Bailout is even bigger, and Obama wants chill in Mississippi.
#467619

On September 24th, 2008 at 5:09 pm, Misscheryl said:

More interesting reading:

http://pfds.opensecrets.org/092408.html
#467628

On September 24th, 2008 at 5:14 pm, Bill Grant said:

Not that I am advocating for anything on this because I do not know if this bill is the correct thing to do or not, but:

Which is better, a bail out bill or a great depression? Which is better, a bailout bill or the American version of the Japan credit crisis?

I am stocked up on hard currency, canned goods and bullets so Ill be fine, but the course of action advocated here: “doing nothing” may not be the best idea… Or it may… Who is REALLY sure on this one?
#467643

On September 24th, 2008 at 5:30 pm, wayiwalk said:

A good friend today proposed letting the whole country massively meltdown, go through a Darwinian survival test.

Personally, while I have a fixed rate mortgage, and own more than 55% of my house, as an engineer I don’t think the clients I work for (private industry, local, state and federal entities and agencies) will have the resources to keep me busy during a meltdown, so I’m not crazy about THAT idea…
….but dam if this new story of a fleecing of the American public makes me want to throw caution to the wind and say – “let’s have it”.

(PS, had the – “you know things may get really bad over all this”, last night with my wife. Kind of depressing to consider the country may head into a depression…)

Boys and Girls, this is gonna get scary.

And the candidates are NOT up to this challenge.
#467655

On September 24th, 2008 at 5:43 pm, Salukidog said:

This is ridiculous…and in todays mail I received a postcard from http://www.usbankhomemortgage.com advertising “discount on closing costs &easy loan application process” what do they know that we do not?
#467706

On September 24th, 2008 at 6:14 pm, Chief RZ said:

No money for illegal aliens who were given free credit.
This really is the fault of some banks, but the old “racial shakedown” artiste is hiding in the closet.
#467722

On September 24th, 2008 at 6:30 pm, corona said:

great article here
#467766

On September 24th, 2008 at 7:06 pm, SylviaMarie said:

Tuesday, 9-23, on NPR’s Fresh Air, Terry Gross interviewed Gretchen Morgenson, a NYT columnist and financial reporter. I know, I know, NPR & NYT — what a stinking combo — but had some very interesting info, as you will see. At about minute 23:00 this fascinating exchange described a loophole in the bailout proposal which is big enough to drive the bad debt of foreign countries through.

Here’s the link: http://www.npr.org/templates/story/story.php?storyId=94928783

I transcribed the exchange, and here it is with my emphasis added:

* * *

TG: Now, these toxic loans and financial products that have been compared to weapons of mass destruction, a lot of them have ended up in foreign banks because of the global economy. What is the bailout plan gonna do, if anything, for the foreign banks that have this toxicity in them now?

GM: Well, I think the bailout plan states that you have to have a US entity in order to be able to sell loans to the fund. So I think it keeps or it’s trying to keep foreigners from, you know, sort of dumping their loans on to the taxpayer. But again, you know, Wall Street is very creative and knows how to get around these kinds of dictums. And what you could easily see someone do is offer to buy a foreign entity’s loans, put them on their books, and then send them to the taxpayer as part of their problem. So you know, kind of getting around that attempt to cordon it off only to the United States entities.

* * *

Stunning! You know “creative” financiers won’t be able to pass up this golden opportunity. Just how much foreign bad debt will be added to our bill? You think these foreign entities might throw in some bad student loans and maybe some credit card debt, too? Everyone else is doing it.

Sure, give the toxic debt to the Americans. They’ll swallow anything.
#467802

On September 24th, 2008 at 7:33 pm, right4life said:

Who is REALLY sure on this one?

no one…I just know the government doesn’t have a good track record ’saving’ us…
#467828

On September 24th, 2008 at 7:54 pm, longbow said:

Yeah, the “Hi I’m from the government and I’m here to help you” line is still working on some people…
#467996

On September 24th, 2008 at 10:05 pm, robert537 said:

We’re doomed. The only cure for this is term limits and an informed electorate (neither is likely). Polls show people think Obama (#2 recipient of Fannie/Freddie contributions) would better handle the economy. What data do people have to support that idiot notion?

When the gummint creates a market for worthless crap, you can depend on business to manufacture as much crap as the gummint will buy.

Less than half the people in this country pay any meaningful amount of tax (i.e. pay in more than per-capita spending) so the majority thinks “don’t cost me nuthin”.

And then the rich assuage their guilt by voting for liberals. Living north of San Diego (lots of rich people), I’m amazed at the number of Obama stickers… people who vote liberal because 1) they have enough money to afford possible tax increases and 2) they manage to live without the consequences of the policies they support with their votes. I’m damn sure that if the rich folks in Carlsbad or Rancho Santa Fe had to tolerate masses of illegals in their schools, street crime, or a few housing projects in their neighborhoods – their tune would change.
#468004

On September 24th, 2008 at 10:08 pm, robert537 said:

#188: if you’re some Wall Street tycoon peddling worthless paper to the clowns at Fannie/Freddie/Sallie Mae then, yes, the government is “here to help”.

If I were in Congress, I’d attach some pretty nasty medicine to these pills (e.g. credit card companies would have to agree to caps on interest and fees; no golden parachutes; etc).
#468017

On September 24th, 2008 at 10:21 pm, unaffiliated said:

Has anyone noticed the following ad in the middle of msn.com home page?

Offer: Bush signs housing rescue bill. $300,000 for $1,727/mo Fixed. NO SSN REQUIRED

Guess the lenders still aren’t concerned about the financial crisis we are in………or the problem of giving loans to illegals!
#468027

On September 24th, 2008 at 10:32 pm, almiller said:

This is a must hear!
http://freshtracks.us/
#468033

On September 24th, 2008 at 10:39 pm, RockyR said:

I have a solution for you: This government needs to be abolished. We the people need to go dust off that old document called the Constitution and try this again.

I love the irony on FoxNews tonight: A commercial advertising refinancing products because “the government bail-out is fueling a new re-fi boom”. Immediately following that jaw-dropping advert was a sound bite from Busy’s speech. Perfect. Swindle, swindler.
#468039

On September 24th, 2008 at 10:46 pm, RockyR said:

You know, we’re all Democrat this, Democrat that on this board I’m not a Republican… anymore… but, I’m DEFINITELY not a Democrat. However, the Dims are the ones taking the lead speaking out against paying the executives in these failed corporations millions of dollars to leave.

Regulating executive pay is wrong, however, disallowing the enrichment of larcenous executives in a “bail-out” is right.
#468041

On September 24th, 2008 at 10:48 pm, TXGator said:

True story:
Sold my home in South Central Los Angeles to a group of illegal alien families in 2005. 900 square foot house, and there were 12 of them including their children. Sold for about $400,000. I wonder if they kept up the hefty payments or just walked away to another house down the street when the bottom dropped out.
I know, I’m part of the problem, but if I didn’t sell to them, I would’ve been sued.
#468057

On September 24th, 2008 at 11:02 pm, cyberbo2004 said:

Can this be that Paulson is going to make some BIG money on this?

As Goldman’s chief, Paulson himself received an $18.7 million cash bonus for the first half of 2006, and in 2005 he was the highest paid chief executive officer on Wall Street, reaping $38.3 million in salary, stock and options.

He had also accumulated 3.23 million shares of Goldman’s common stock worth $492 million, plus restricted shares worth $75.2 million and options to purchase 680,474 shares, according to a Goldman regulatory filing on July 2, 2006.

Paulson wasn’t required to pay a 20 percent tax penalty on some of his compensation from Goldman under an Internal Revenue Service rule that waived the tax on executives forced to sell stock to comply with government ethics rules.
#468066

On September 24th, 2008 at 11:09 pm, Salukidog said:

Here is a great video, that explains this housing/banking crisis, and who created this mess!
#468068

On September 24th, 2008 at 11:10 pm, vatodio said:

I want our esteemed leaders to explain the bailout us:

Who exctly gets hold of the $700 billion and how are they going to use the money to stimulate the economy?

Certainly, the money cannot be used to pay the salaries of the guys who got us into this mess in the first place. At the same time, the money cannot be used to bail out the flippers who were betting on the ever rising house prices.

Are these money going to be used for the low income housing loans?

What transparency will be built in, so that we the ordinary Americans, can track the flow of the money?

How are these money to be paid back to the treasury? What would be the terms and the timetable?
#468073

On September 24th, 2008 at 11:16 pm, Cristy Li said:

I didn’t know what to make of this bailout, even after listening to both sides. Thanks for putting things into perspective.
#468080

On September 24th, 2008 at 11:21 pm, YTZGal said:

On September 24th, 2008 at 4:28 pm, nlebou said:
Did anyone see Michelle on Cavuto?

Nlebou, I was on the treadmill at the gym watching the news when the “tease” stating MM was going to discuss the illegal alien angle came on. I had read her blog post, so wanted to hear her and Cavuto’s questions.

I think she got bumped because of Barack’s break-in statement….I ended up doing 6 miles waiting to see our lovely hostess but w/o success.

Hopefully they will invite her back on tomorrow to elaborate on the illegal alien/no doc aspect of this.

That is the 800 lb gorilla no one wants to talk about.
#468085

On September 24th, 2008 at 11:26 pm, YTZGal said:

On September 24th, 2008 at 1:11 pm, AlohaGuy said:
The amnesty-promoting National Council of La Raza and its Development Fund have received millions in federal funds to “counsel” their constituents on obtaining mortgages
I want them to stop giving my money to political groups! La Raza, ACORN, Black Panthers, KKK, any of them!

Hear! Hear!
That needs to be part of the “reform” – and non-negotiable.
#468147

On September 25th, 2008 at 1:12 am, California Red said:

I know there is passion and principle on this site. I hate the idea of a bailing out the irresponsible with all my heart.

But there is merit to the idea that credit needs to flow for busines to carry on and for the housing market to recover.

If we can avoid a depression we might be best served by some type of government assitance to keep credit flowing.

I say we let the investment banks and Wall Street eat the derivate securites they have gobbled up and just have the Feds give loans directly to qualified people to buy homes and start/operate/expand business. CA has a Vet loan program that hasn’t cost us any tax dollars in generations.

The root of this is housing boom and bust. Only when the housing market stablizes will our economy rebound. Let’s let Wall Street sleep in the bed they’ve made while helping our Main Street.

If we want to kill the bill, there has to be an economically sound alterntive.
#468162

On September 25th, 2008 at 3:12 am, greenLibertarian said:

Thanks, Michelle.

I sent the link to this article, and my own spirited comments, to my three Oregon federal legislators.
#468208

On September 25th, 2008 at 8:03 am, RockyR said:

Is this one flying under the radar?

Michigan
#468233

On September 25th, 2008 at 8:58 am, bear1909 said:

RabbidSquirrel said:
On September 24th, 2008 at 1:47 pm, bear1909 said:
Also, remember, the Fed has NO CONSTITUTIONAL AUTHORITY. Nor does the IRS.
Havent read all of the posts on this thread but, um…..
The 16th amendment and the Federal Reserve Acts (which is a derivative of the constitutional authority of the Legislative Branch)?

The introduction of said “laws” in 1913 was overturned by the Supreme Court but then overturned in reverse (making it legal) when the makeup of the court changed. The deal was then sealed in 1929 (oops!).

It is a granted point in constitutional law circles that the Federal Reserve System has debatable constitutional validity. It exists because viable and strict constructionist compliant values have not been applied to solve the nation’s money problem that has plagued it since its founding.
#468257

On September 25th, 2008 at 9:28 am, Dimsdale said:

From the Senate Banking Commission web page:

Extracts From the Standing Rules of The Senate
Rule XXV, Standing Committees

1. The following standing committees shall be appointed at the commencement of each Congress and shall continue and have the power to act until their successors are appointed, with leave to report by bill or otherwise on matters within their jurisdictions:

(d)(1) Committee on Banking, Housing and Urban Affairs, to which committee shall by referred all proposed legislation, messages, petitions, memorials and other matters relating to the following subjects:

* Banks, banking, and financial institutions.
* Control of prices of commodities, rents and services.
* Deposit insurance.
* Economic stabilization and defense production.
* Export and foreign trade promotion.
* Export controls.
* Federal monetary policy, including the Federal Reserve System.
* Financial aid to commerce and industry.
* Issuance and redemption of notes.
* Money and credit, including currency and coinage.
* Nursing home construction.
* Public and private housing (including veterans housing).
* Renegotiation of Government contracts.
* Urban development and urban mass transit.

(2) Such Committee shall also study and review on a comprehensive basis, matters relating to international economic policy as it affects United States monetary affairs, credit, and financial institutions; economic growth, urban affairs, and credit, and report thereon from time to time.

So exactly what have they been doing all this time?

Hello? Mr. Dodd? Mr. Dodd? Bueller? Bueller?
#468922

On September 25th, 2008 at 3:23 pm, Paul-Cincy said:

Michelle, aren’t you being too much of an ideologue, too dogmatic? Ever heard the phrase, “for the want of a nail, the kingdom was lost”? Do we want to repeat the failures of the 1930s? Can I set a record for most consecutive questions?

If drying up of credit causes a deep recession and loss of jobs, perhaps the bailout is a good idea. I don’t really know.