THIS PAGE HAS BEEN ACTIVATED AS THE NEW STATESMAN BLOG IS NOW CLOSED FOR COMMENTS
At 10am this morning, the New Statesman finally closed the Mark Lynas thread on their website after 1715 comments had been added over a period of five months. I don’t know whether this constitutes any kind of a record, but gratitude is certainly due to the editor of of the New Statesman for hosting the discussion so patiently and also for publishing articles from Dr David Whitehouse and Mark Lynas that have created so much interest.
This page is now live, and anyone who would like to continue the discussion here is welcome to do so. I have copied the most recent contributions at the New Statesman as the first comment for the sake of convenience. If you want to refer back to either of the original threads, then you can find them here:
Dr David Whitehouse’s article can be found here with all 1289 comments.
Mark Lynas’ attempted refutation can be found here with 1715 comments.
Welcome to Harmless Sky, and happy blogging.
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10,000 Responses to “Continuation of the New Statesman Whitehouse/Lynas blogs.”
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Hi Peter,
You have repeated the IPCC claim of a 2xCO2 “climate sensitivity” of 1.5° to 4.5°C.
The problem with this claim is that it is based solely on climate model assumptions rather than on actual physical observations.
IPCC states that clouds cause a net “positive feedback” resulting in a 2xCO2 temperature impact of +1.3°C (from an average of +1.9°C to +3.2°C).
Physical observations show that the net feedback from clouds is strongly negative, rather than positive. This should result in a temperature impact of around –1.3°C.
IPCC assumes that atmospheric water vapor content will increase with higher temperatures to maintain a constant relative humidity. This effect results in a 2xCO2 temperature impact of +1.5°C.
Physical observations show that water vapor content increases with temperature, but at a much lower rate than that assumed by the IPCC models, resulting in a positive feedback temperature impact of less than +0.8°C.
If one corrects the IPCC model assumptions based on the actual physical observations, one ends up with a theoretical 2xCO2 climate sensitivity of around 0.5° to 0.8°C, as estimated by Lindzen and Shaviv/Veizer.
This translates into an expected temperature increase from today until the year 2100 of 0.3° to 0.5°C (all other things, such as solar influence, ENSO impact, etc. being equal).
Really nothing much to talk about, Peter, and certainly nothing to fret about.
Regards,
Max
Obviously Dr Mann is a hate figure for you guys! Was it the ancient Greeks who killed messengers of bad tidings?
True, the Wegman report was critical of the Mann hockey stick, but Dr Wegman wasn’t saying he was wrong. This is Joe Barton the chairman of the Congressional panel, described in Wiki as a prominent global warming sceptic : “Dr. Mann’s conclusion may be right but you can’t verify it from his statistics in his model, so if Dr. Mann’s conclusion is right, it is incumbent upon him and his colleagues to go back, get the math right, get the data points right, get the modeling right. That is what science is about”
It looks like Dr Mann may done exactly that in producing his latest paper.
Its not just Mann et al who are saying that the earth is now warmer than at any time in the last 1000 -2000 years. The US National Academy of Sciences has published a collection of work in their book entitled: Surface Temperature Reconstructions for the Last 2,000 Years
http://books.nap.edu/openbook.php?record_id=11676&page=2
The whole of this book is available online and the above link (page 2 of the summary) contains the results of five other long term studies, all of which show that it is warmer now, than during the MWP. Are the NAS charlatans and frauds too?
Incidentally, although M&M have consistently carped on about plots and graphs produced by others I haven’t seen any of theirs. Are they, or Dr Wegman, on record as having supported Max’s assertion that the MWP was warmer than the present day?
Obviously Dr Mann is a hate figure for you guys! Was it the ancient Greeks who killed messengers of bad tidings?
True, the Wegman report was critical of the Mann hockey stick, but Dr Wegman wasn’t saying he was wrong. This is Joe Barton the chairman of the Congressional panel, described in Wiki as a prominent global warming sceptic : “Dr. Mann’s conclusion may be right but you can’t verify it from his statistics in his model, so if Dr. Mann’s conclusion is right, it is incumbent upon him and his colleagues to go back, get the math right, get the data points right, get the modeling right. That is what science is about”
It looks like Dr Mann may done exactly that in producing his latest paper.
Its not just Mann et al who are saying that the earth is now warmer than at any time in the last 1000 -2000 years. The US National Academy of Sciences has published a collection of work in their book entitled: Surface Temperature Reconstructions for the Last 2,000 Years
{http}://books.nap.edu/openbook.php?record_id=11676&page=2
remove {} to obtain link
The whole of this book is available online and the above link (page 2 of the summary) contains the results of five other long term studies, all of which show that it is warmer now, than during the MWP. Are the NAS charlatans and frauds too?
Incidentally, although M&M have consistently carped on about plots and graphs produced by others I haven’t seen any of theirs. Are they, or Dr Wegman, on record as having supported Max’s assertion that the MWP was warmer than the present day?
Tony B,
Maybe I’ll volunteer as spokesman. My diplomatic demeanor is just what our side needs!
One other thing; what exactly does “being green” mean?
TonyB,
I think you might be on safer ground, too, if you stay away from the laws thermodynamics. Unless, of course, you take the trouble to understand what they are first.
Your question on economic experts deserves better treatment. I seem to remember Robin coming up with a similar comparison to yours except that he chose CIA ‘experts’ rather than US Fed and Wall St ‘economic’ experts, and the Iraqi weapons of mass destruction issue. Neither are valid comparisons. If the WMD issue had been openly discussed with all the relevant evidence freely available in the public domain, and in accordance with correct scientific method , the outcome would have been very different.
The current economic crash wasn’t just predicted by outsiders like myself. The universities are full of economists who were saying pretty much the same thing. On the right, the criticisms were that the US dollar was treated pretty much as a piece of paper to be printed at will. These economists want money to be of real value and linked to a commodity such as gold or silver. Peter Schiff is now famous for his predictions of the coming crash. The left was saying pretty much the same thing, but based on Marxist theory of the internal contradictions within capitalism. Their line is that capitalism suffers from a tendency of profits to fall. One way of keeping the system going is to create credit fuelled spending bubbles to force up the price of assets, which in turn fuels more borrowings and spending, to create the demand to keep production, and profits, going at their maximum level. A bit like a junkie injecting himself with a ‘fix’. So, take your pick of which explanation you prefer!
In the middle, there were those who have been proclaiming that boom and bust cycles are essentially a thing of the past, ( Gordon Brown?) and that with proper management the economic growth, which we have seen in the last twenty years, could be sustained indefinitely. One economic historian Francis Fukuyama wrote in his 1992 book, The End of History, “What we may be witnessing is not just the end of the Cold War, or the passing of a particular period of post-war history, but the end of history as such: that is, the end point of mankind’s ideological evolution and the universalizing of Western liberal democracy as the final form of human government”. Of course, that’s looking a little less likely now.
But, as you can imagine, when governments and banks, and the FIRE sector of the economy generally, have been hiring economists, (and politicians too ?) these have been the ones they have wanted. The ‘can do’ guys. These are the ones you will have seen on TV talking about ‘soft landings’ and the ‘fundamentals of the economy are in god shape’ etc etc. What bank is going to pay six and seven figure salaries for economists who are going to shake the table on which the house of cards is built? In many ways the more orthodox economists of both the left and right have better represented the scientific tradition of economics. The ‘end of history’ faction have been the sceptics, and they have been proved wrong.
It may surprise some of you, but there were others who warned of the potential for financial crisis, but were ignored and/or rebuffed by Congress:
The Bush administration urged the Congress to reform Fannie and Freddie at least 17 times this year alone. They called for regulatory overhaul of both of these GSE’s within months of inauguration in 2001, calls which continued repeatedly throughout Bush’s two terms. Their warnings went unheeded by the Congress until Fannie and Freddie ultimately failed and were forced into receivership to the tune of a minimum of $200 billion in taxpayer dollars.
Fannie and Freddie were large campaign contributors to members of Congress of both parties.
Here’s more background on the loose lending standards that got us into this mess.
JZ,
You may want to pass this around until it gets pulled down…..
http://www.youtube.com/watch?v=NU6fuFrdCJY&NR=1
JZ and Brute,
Maybe you could answer this question. Would sub-prime mortgages be such a problem if the price of real estate had not gone through a boom and bust cycle?
In other words if R.E. prices had been kept constant or been allowed to rise slowly in line with incomes or general inflation.
I’m saying they wouldn’t. And, that the real problem occurred in the post 2001 period when the bubble started to be inflated. It was too late to fix by 2007/2008.
Even if the default rate had been high, it would have been straightforward to repossess and resell the properties of defaulting borrowers. Or they could have chosen to sell themslves and get out of the mortgage that way.
The banks were willing participants to the extent that they preferred selling SP mortgages over conventional ones. Never mind that they were more likely to be unaffordable, the interest rates were higher, especially after a couple of years when they automatically reset to a higher level. Maybe its a bit patronising to suggest that many lenders were unaware of what they were signing up for but I’ll say that anyway. The loan sharks who deliberately falsified applications, in order to pocket fat commissions, without explaining exactly what they were selling, and knowing that the borrowers could never afford the payments, are probably the lowest form of sewer life imaginable.
After the revolution they should be first up against the wall!
I should have written “Maybe it’s a bit patronising to suggest that many borrowers…”
Brute, JZSmith, Peter
Have been following your exchange on the current economic crisis (#2006-2008).
Below are some independent thoughts on the $700 billion bailout package of the USA known officially as the Emergency Economic Stabilization Act of 2008. They apply equally well for the trillions of dollars in emergency packages being considered by other nations.
Ivan Eland, director of the Center on Peace & Liberty, writes, “[Herbert] Hoover converted a mundane recession into the greatest economic disaster in modern history–the Great Depression. Unfortunately for all of us, George W. Bush is headed down that same path.”
Alvaro Vargas Llosa, director of the Center on Global Prosperity, writes, “As many authoritative economists are desperately trying to explain amid all the confusion, the culprit was a system geared toward loaning money to people who were not in a position to pay it back. Two policies underpinned that system: easy money by the Federal Reserve and the government-induced lowering of standards for approving loan requests.”
William J. Watkins, Jr., author of Reclaiming the American Revolution , writes, “Americans should be concerned that a constitutional discussion was completely absent from the national debate about the bailout package. The [bailout package] is the largest government intervention in the private economy in the history of the United States–it makes FDR’s New Deal and President Truman’s seizure of the steel mills look like Mickey Mouse…. If the Constitution is not consulted or debated when the government seeks to acquire and manage billions in private assets, then we may safely assume that there are no limits on Congress’ powers. Untrammeled government authority–not economic stabilization–will be the lasting legacy of this Wall Street bailout.”
Robert Higgs, author of Depression, War, and Cold War, writes, “Although the [Federal Reserve] data show some evidence of diminished lending in some credit markets, they do not comport with allegations that the credit markets have ‘seized up,’ ‘locked up,’ or ‘frozen up’ or with claims that ‘nobody is lending’ or that the credit markets have ‘stopped functioning.’ All such turns of phrase, which appear in virtually every report in the mainstream media, are sheer hyperbole–which, I might add, serve only to heighten a sense of panic among the public and within the inner sanctums of Our Blessed Rulers and Saviors.”
Marc Faber, Singapore-based economist, put it more succinctly, “If government bailouts could really solve economic crises, then the socialist systems in the Soviet Union and Eastern Europe would not have collapsed.”
Max
Hi Peter,
Your tenacity is admirable, when you write (#2003), “True, the Wegman report was critical of the Mann hockey stick, but Dr Wegman wasn’t saying he was wrong.”
Sorry, Peter. That is exactly what he was saying (as regards the Medieval Warm Period).
To quote from the many page Wegman report cited by TonyB:
“We in turn agree…that the present era is likely the hottest in the last 400 years.” (Duh! That was the Little Ice Age).
“We concluded that the statements regarding the decade of the 1990s probably being the hottest in a millennium and 1998 probably being the hottest year in a millennium are unwarranted.” (Ouch! That covers the Medieveal Warm Period).
Give it up, Peter. You just make yourself look silly by trying to defend Mann’s bad science.
Regards,
Max
Max,
You seem totally fixated on Mann. What about other papers who have said pretty much the same thing? What about Jones, D’Arrigio, Briffa, Oelemans, Jansen, Moberg, Wilson, and all their co-workers? They have all now produced results which agree with Mann. Are they all frauds and charlatans too?
You are claiming that the MWP is warmer than now. Who else is saying that? Certainly not Wegner. Have you any references?
Max,
I should have written Wegman rather than Wenger. I might have confused the name with the manager of Arsenal football club. He doesn’t claim that the MWP was warmer than now either!
I notice that you’ve chickened out of taking me on, on the economic crisis question. Rather than give me your opinion, you’ve chosen to tell me what several other people think. I know that there are those out there who do argue, for whatever reason, that the victims of predatory lenders are to blame for the current crisis. But what do you think?
TonyN: I suggest that your post today commenting on my 1987 is in the wrong place.
TonyB: at 1999 you mentioned a charismatic AGW proponent. Here’s another.
Re: #1987, Robin
Of course you are right, the ‘risk free politics’ of climate change has no resonance outside Europe, N. America and the Antipodes.
One of the possible outcomes of the banking crisis – and the global recession that seems sure to follow – is that the emerging economies may be in a far better position to recover, in time, than we will be. Their economies depend on manufacturing and natural resources to an extent that is no more than a distant memory for us. Our febrile ten-year boom has been driven by consumer spending and service industries, and a major re-modelling of our economies may be required before the good times return. All our competitors need is an upturn in demand.
The ‘risk free politics’ of climate change is clearly incompatible with the aspirations of the emerging economies, and it seems unlikely that they will do much about reducing CO2 emissions, whatever platitudes they may mouth at international conferences. If we continue to make economic policy on the assumption that AGW is a reality, this will have dire consequences for our competitiveness in the recovery period.
None of this will help clarify the scientific issues, but it may provide the nations that are presently subject to the ‘risk free politics’ of climate change with an incentive to re-assess the findings of the IPCC and other organisations that have promoted fear of AGW. And if this happens, the politics of climate change will no longer be risk free, and surely this would be a healthier situation than the present one.
Re: #2014, Robin. Thanks!
Hi Peter,
You wrote (2012): “You seem totally fixated on Mann. What about other papers who have said pretty much the same thing? What about Jones, D’Arrigio, Briffa, Oelemans, Jansen, Moberg, Wilson, and all their co-workers? They have all now produced results which agree with Mann.”
No fixation, Peter. Mann et al. just produced the “daddy” of all hockey sticks, which was used to back the claim that there was no Medieval Warm Period but was later shown to be based on incorrect methodology and therefore discredited.
Peter, the record is the record, even if it does not happen to confirm what you believe to be true. Mann attempted to erase the MWP in order to claim that the 1990s were the warmest decade in a millenium, but his study was shown to be based on flawed methodology and his conclusion, therefore, was shown to be invalid.
Once Mann was discredited, there were many other reports, some confirming a global MWP warmer than today, others not going back that far, etc. Some others preceded Mann’s first report. You named a few but failed to mention many others, such as Baliunas + Sonn, Keigwin, Loehle, etc.
The post-Mann “party line” became, “yeah, well there may have been a MWP that was warmer than today, but it wasn’t global, like the present warming” [with the exception of the southern half of the globe, which we won’t talk about].
As regards the existence, the warmth and the extent of the MWP it is not at all true, as you wrote, that these reports “have all now produced results which agree with Mann”,
Just a few examples:
Keigwin (1996): “Because of high rates of sediment accumulation, Holocene oscillations are well documented in the northern Sargasso Sea. Results from a radiocarbon-dated box core show that SST was ~1°C cooler than today ~ 400 years ago (the Little Ice Age) and 1700 years ago, and ~1°C warmer than today 1000 years ago (the Medieval Warm Period). Thus, at least some of the warming since the Little Ice Age appears to be part of a natural oscillation.” (Oh-oh! Sargasso Sea part of localized MWP in Europe?)
Cook, Palmer + D’Arrigo (2003): “This record is the longest yet produced for New Zealand and shows clear evidence for persistent above-average temperatures within the interval commonly assigned to the MWP. Comparisons with selected temperature proxies from the Northern and Southern Hemispheres confirm that the MWP was highly variable in time and space. Regardless, the New Zealand temperature reconstruction supports the global occurrence of the MWP. (Oops!)
Osborn + Briffa (2006): “Positive anomalies during 890 to 1170 and negative anomalies during 1580 to 1850 are consistent with the concepts of a Medieval Warm Period and a Little Ice Age, but comparison with instrumental temperatures shows the spatial extent of recent warmth to be of greater significance than that during the medieval period.” (No confirmation of Mann’s flat hockey stick here.)
Moberg et al. (2005): “high temperatures – similar to those observed in the twentieth century before 1990 – occurred around AD 1000 to 1100, and minimum temperatures that are about 0.7°C below the average of 1961-90 occurred around AD 1600” (Also no “confirmation” of Mann.)
Loehle + McCulloch (2008): “The mean series shows the Medieval Warm Period (MWP) and Little Ice Age (LIA) quite clearly, with the MWP being approximately 0.3°C warmer than 20th century values at these eighteen sites.” (Ouch!)
Both Loehle and Moberg show a distinct MWP, followed by a LIA; Moberg shows medieval temperatures “similar” to those of today while Loehle shows these to be slightly higher than today.
On his ClimateAudit site Steve McIntyre has made an interesting comparison of Loehle’s methods and findings with those of Moberg.
http://www.climateaudit.org/?p=2403
Soon + Baliunas (2003): “A review of more than 200 climate studies led by researchers at the Harvard-Smithsonian Center for Astrophysics has determined that the 20th century is neither the warmest century nor the century with the most extreme weather of the past 1000 years. The review also confirmed that the Medieval Warm Period of 800 to 1300 A.D. and the Little Ice Age of 1300 to 1900 A.D. were worldwide phenomena not limited to the European and North American continents. While 20th century temperatures are much higher than in the Little Ice Age period, many parts of the world show the medieval warmth to be greater than that of the 20th century.” (A direct refutation of Mann.)
A few other studies showing a MWP warmer than today in various parts of the world:
Bartholy et al. (2004) – Hungary
Blundell + Barber (2005) – Scotland
Chuine et al. (2004) – France
Dahl-Jensen et al. (1998) – Greenland
Esper et al. (2002) – Pakistan, Kirghistan
Fleitman et al. (2004) – Oman
Gray et al. (2004) – North America, Europe Middle East
Holmgren et al. (2001) – South Africa
Hu et al. (2001) – Alaska
Kitagawa and Matsumoto (1998) – Japan
Luckman + Wilson (2005) – Canada
Munroe (2003) – North America
Yadav + Singh (2002) – India
Yang et al. (2002) – China
Zhang et al. (1998) – China
So you see, Peter, that these many reports were not “confirmations” of Mann’s hockey stick, but rather refutations.
But, aside from the many proxy studies, the overwhelming support for a global MWP warmer than today and a LIA colder than today is found in physical evidence (vegetation and signs of medieval civilization under receding glaciers) and historical records (sea charts, crop records, chronicles, records of human migrations, etc.). This is direct evidence, even more compelling than the many proxy studies.
Regards,
Max
Hi Peter,
“I notice that you’ve chickened out of taking me on, on the economic crisis question.”
Not so, Peter. It is really a bit off-topic here.
“I know that there are those out there who do argue, for whatever reason, that the victims of predatory lenders are to blame for the current crisis. But what do you think?”
Here is what I think (for what it’s worth). Predatory lenders, the end of the strict separation between commercial and investment banks under U.S. law, poor oversight of banking practices, “packaging” and re-selling of “products” that consist of non-transparent bad debts, greed, predatory credit card companies luring irresponsible individuals into major debts, the irresponsible individuals themselves, over-aggressive mortgage salesmen (and women), political pressure from the left (via Acorn, Fanny Mae, Freddy Mac) to give low income individuals access to home mortgages, heavy lobbying of Congress members by these groups, a flawed monetary policy based on easy money, a society that spends more than it earns, the shift from a manufacturing based to a pure service based economy, outsourcing of manufacturing jobs to China and Latin America, a disastrous balance of payments and public debt, individuals who take on mortgages they know they can never repay in the hopes that the real estate will gain in value, so they can re-finance and get more money to spend; all of the above (and probably a lot of others I have failed to name) are to blame.
Switzerland feels this global problem, too, although there is no proposal (so far) for a “bail-out” here, no increased“ government guarantees” of bank accounts (remains at CHF 30,000), etc. as there is in the rest of Europe. A Swiss mortgage requires a minimum 20% down payment, people tend to put money into savings, buying on credit is rare and credit card debt is practically unknown. A different culture.
But one thing is for sure, as other on this site have already remarked (and to get back on topic). This global problem has already eclipsed AGW, and it will continue to do so, especially if the climate continues to cool and overstretched economies and governments begin to realize the high cost and negligible benefits of “mitigation”.
Those are my thoughts on the subject. How about yours?
Regards,
Max
Peter,
The underlying problem in the current financial crisis is the RE bubble. Had prices continued to rise, those with subprime mortgages could have refinanced once the mortgage reset to a higher rate. Eventually, of course, the situation would blow up regardless of RE prices.
The banks for sure are guilty in this mess, even if only negligence in not looking more closely at the situation. I suspect, however, that the money was so good that they didn’t really want to look to closely. Pity the bank CEO who advocated getting out of lucrative mortgages… the shareholders and board would have had his head, since so few really understood the risks to the global economy.
Yes, “community organizers” and other groups who pressured lending institutions to lend to those who really couldn’t afford the houses they were buying are to blame as well, despite their good intentions. We all support the idea of helping those less fortunate, but this falls into the category of “unintended consequences”. Thus my fear and suspicions on the “solutions” to AGW.
One last thing about the mortgage meltdown: Here in southern California there are reports I’ve seen—but cannot confirm—that many, many of the homes in foreclosure are owned by illegal aliens. We have many hundreds of thousands (maybe millions) of “undocumented” workers here, and their presence has put a lot of stress on the economy and government services.
Max,
Re the MWP discussion, you seem to be somewhat shy of giving the actual references of the authors you’ve cited. Its always good to be able to read what they’ve actually written rather than what someone else claims they have written. I hope you’ll understand that the thought that you might have cherry picked some of their comments has crossed my mind!
Ideally you should be aiming to link to graphs like this one:
http://www.ncdc.noaa.gov/paleo/pubs/darrigo2006/fig5.jpg
And no its not the Mann graph! A different team entirely. Why don’t climateaudit kick up such a fuss about this too?
……………….
On your economic points , yes, I agree with many of them. I know that I shouldn’t delight in the misfortunes of others. As you’ll know, the German language actually has a word for it: “Schadenfreude” and maybe the Germans are genetically prone to do just that. Maybe I have some of their genes in me, because whenever I open the newspaper,and read reports that the US Republican administration has just about nationalised all their leading banks, as has Gordon Brown in the UK, I just can’t keep the grin off my face! I suppose you guys felt the same way when the Iron curtain fell.
Its good that the Brits still have a sense of humour.
http://au.youtube.com/watch?v=jbgwR1pA1k0
If I come across a George Bush version I’ll let you know
Hi Peter,
JZSmith has brought up the topic of “illegal aliens” and their impact on the US sub-prime mortgage crisis, the economy and government services.
While the magnitude and impact in tiny Switzerland is obviously much less important, there is a similar trend here. It is from illegal “refugees” from despotic regimes and/or abject poverty in places like the former Yugoslavia, various parts of Africa, etc. that are not only ending up on the government dole here but are also gradually changing the culture and mentality of the country. In addition, violent crime rates have increased exponentially with this influx of “underpriviledged” individuals, who have grown up learning the “law of the fist”.
Obviously, one cannot blame everything on these poor individuals, but it is clear that they have become part of the problem of a “culture shift” for the worse, which many Swiss recognize and resent.
Do you have this problem in Australia, and if so what is being done about it?
Regards,
Max
Hi Peter,
“I hope you’ll understand that the thought that you might have cherry picked some of their comments has crossed my mind!”
Yes, Peter, like you “cherry picked” the reports you (erroneously) felt supported Mann.
Let’s break this off, Peter. It is getting repetitive and you are getting absolutely nowhere in your futile attempts to resurrect Mann’s hockey stick. Face it, Peter. It’s dead and buried.
I have referenced many reports from all over the world that confirm this.
Regards,
Max
Hi Peter,
To help you out a bit on the linguistic side, the French words for the German “Schadenfreude” are “malignité” or “malice”, while the English expressions are “maliciousness” or “gloating”.
Do you Aussies also have an expression for this? Or does it not exist in your culture?
Regards,
Max
Pete,
Yes, it would still have become a problem. Democrats in Congress as well as Bill Clinton effectively legalized cocaine and then mandated cut rate prices to the addicts. The drug dealers, (sub-prime mortgage lenders) simply adhered to the law that they were forced to comply with. If the banks had refused to lend money to the high risk borrowers, they would have violated provisions of the Community Reinvestment Act and would have been sued and/or been denied the ability to conduct business, (lose FDIC insurance certification and denied the ability to merge with other banks).
Now, the non-addicted people have to pay for the rehabilitation.
JZ,
Same thing here on the East Coast with an added twist in that many of the foreclosed homes were purchased by foreign investors, (India, China, Philippines, etc) looking to turn a quick 50 K, (or more) on U.S. homes. They applied for and received no document loans (no proof of income, job or assets) thinking that as the homes were finished being built, they’d turn around and resell them quickly at a tidy profit. When the value of the houses fell and the note became more than the value, they simply walked away. These people had no interest in living in the US or ever occupying these homes…..just flipping them quickly. Being foreign citizens, the banks/mortgage lenders have no authority or recourse. No collateral or credit references to penalize…..these people just melted away and left the US taxpayer holding the bag.
Another consequence of Liberal/Democrat/Socialist policies.