by Angela S. Young

Created on: October 03, 2008   Last Updated: September 15, 2010

In its history, the United States of America has poured billions of dollars into other country's coffers in an attempt to help them out for various reasons, so should we expect other countries to give back and offer the US some monetary help?  Well, on the surface, why not?  In actuality, however, there are many reasons why the US should not expect other countries to help bail them out.  Offering bailouts, whether to another country or one's own citizens takes a lack of personal responsibility to a global level.  Sometimes everyone needs a helping hand, but sometimes, people need to face the consequences of their own actions.

The problems in the US are not the fault of other governments, and we should expect the people who did cause it to pay the consequences for what they've done. We're in this fix, not because of deregulation, but because someone decided to give money to people who would not have the means to repay. How smart was that?

The New York Times ran an article September 30, 1999 that tells us exactly what happened to cause this crisis. In the article "Fannie Mae Eases Credit To Aid Mortgage Lending" by Steven A. Holmes, it says,

"In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets including the New York metropolitan region will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loan. Fannie Mae officials say they hope to make it a nationwide program by next spring."

Here we see the beginning of the end. Interestingly, the article goes on to quote Peter Wallison, a resident fellow a the American Enterprise Institute as saying, ", this is another thrift industry growing up around us. If they fail, the government will have to step up and bail them out the ay it stepped up and bailed out the thrift industry." Mr. Wallison made a prediction that has definitely come true.

While the economy was in great shape, people managed to make their payments, but as soon as any problems arose, they had to default and a crisis was born.

While there's plenty of blame to go around, I found it very interesting that the article points out, "Fannie Mae, , has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people." The plan was to allow many more people to own homes, but the result was a major economic crisis.

In the end, the United States is responsible for it's own mess. I hope an investigation will reveal the true causes, and the industry will go through a major clean up, but we should not look to others to take responsibility for our problems.

[url=http://query.nytimes.com/gst/fullpage.html?res= 9C0DE7DB153EF933A0575AC0A96F958260&sec=&spon=&pagewanted=1]Times article link[/url]

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