The Corner

Fannie, ACORN, Obama, and the Financial Crisis

Jonah rightly calls today’s David Brooks column a must-read. Brooks discusses Reckless Endangerment, the new book by Gretchen Morgenson and Joshua Rosner exposing Fannie Mae’s role in the runup to the financial crisis. Brooks also rightly credits Michele Bachmann for her important role in publicizing a topic many other national politicians have been silent on.

I’ve only had a chance to give Reckless Endangerment a quick look, but my impression is that it tells the right story, if a bit too much from Fannie Mae’s point of view. In Morgenson and Rosner’s telling, Fannie Mae effectively buys off ACORN and other low-income housing groups. There’s some truth to that, but it underestimates the extent to which ACORN and allied groups forced Fannie Mae into the subprime business in the first place, and sometimes pushed themselves onto Fannie Mae against resistance.

I tell that story in the ACORN chapter of Radical-in-Chief, based on heretofore unseen documents from the ACORN archive at the Wisconsin Historical Society. I also show that Barack Obama was knee-deep in ACORN activities just as their banking campaign reached its height. In fact, much of ACORN’s national housing campaign in the mid-nineties was coordinated from the Chicago office Obama was funneling money to at the time.

So if the combination of the publication of Reckless Endangerment and Michele Bachmann’s campaign brings a new awareness of Fannie Mae’s role in precipitating the financial crisis, by rights it also ought to raise awareness of ACORN’s role, and Obama’s abetment of ACORN activism as well. Of course, for that very reason, the entire story is likely to be ignored. Maybe only someone like Bachmann has the power to break it through.

Stanley Kurtz is a senior fellow at the Ethics and Public Policy Center.

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