Pause for reflection
As we prepare for the inauguration of a new President, it is an understatement to say that the American population is split on quite a few issues. The frustration has led to much reflection on the past years, in order to fully understand where we are as a nation today. However with every new issue that arises, there are more left in the past, some never resolved. An example of this is the detriment of the foreclosure crisis in 2008.
Movies like The Big Short attempted to break down the narrative of this financial disaster, highlighting the fact that many of the key players to blame never saw the inside of a jail cell. Although the Obama administration promised an era of change, the lack of response and accountability left everyone to think that maybe the rich and powerful really can get away with anything.
It is estimated that almost 21 million Americans lost properties due to foreclosure or an associated matter when the housing bubble burst. With every new foreclosure sign hammered into the front lawn of our neighbors, people were left to uproot their lives and find a new place to call home.
It may have not been apparent at the time with so many people suffering great losses, but a large percentage of those affected were families of color. They had been the prime targets for subprime loans, and were known to accumulate wealth in their home equity.
The Atlantic ran a searing story entitled “Obama Failed to Mitigate America’s Foreclosure Crisis,” wherin David Dayen explains how this led to a complete “disintegration of wealth” among these people, which seemed to counter the expectations many had for our first black President.
Though policies were passed to modify mortgages and funds were allocated to apply some relief, no justice was ever served to punish the banks and companies responsible for the crisis in the first place. Foreclosures continued to take place and banks collected every cent of money from homeowners before their inevitable eviction.
Even with this blatant example of fraud, President Obama and the government did not choose to prosecute banks or executives.
So what is the take away? How can the American public learn from this for future lending?
Unfortunately, it seems that borrowers will never be on the same level as those they borrow from. If the Obama administration planned to restore faith in our democracy in regards to this crisis, then they clearly failed. The apathetic response has been met with surges of frustration from the American public, who can now be sure that the same rules do not apply to everyone.
Power and money will always win out. Unfortunately the chance to prove that statement wrong was ignored.