This report chronicles and analyzes the roles played by both ACORN and Senator John McCain (R-AZ) over the past decade leading up to the economic crisis that the United States faces today. Although perhaps an odd pairing on the surface, this comparison was invited by the McCain-Palin 2008 campaign when it released an advertisement on Friday, October 10 blaming ACORN for the crisis, claiming, “ACORN forced banks to make risky home loans, the same types of loans that caused the financial crisis we’re in today.”

This ad was the culmination of weeks of punditry from conservative circles that blamed community organizations like ACORN and the Community Reinvestment Act of 1977 for the mortgage meltdown that triggered the broader financial crisis.

It is true that comparing the records of a community organization and a United States Senator will never be an exact science given their different roles; certainly, it is less facile than comparing two voting records. Still, over a ten year period, serious trends emerge that demonstrate each party’s engagement with the issue of predatory lending, warnings about the likelihood of mass foreclosures, and an understanding of how a widespread failure in the housing market could undermine other sectors of the economy.

As documented herein, ACORN has a rich and consistent history of identifying predatory lending as a serious threat to borrowers, of warning that massive foreclosures were an inevitable result of widespread predatory practices, and of fighting with every tool at its disposal against those risky and dangerous practices.

From working to pass city ordinances and state laws restricting risky lending practices, to protesting and suing lenders, and from lobbying for federal laws and regulations to releasing numerous reports warning of impending crisis, one must conclude that ACORN fought against predatory lending. Though this conclusion may appear self-obvious, it is unfortunately counter to the prevailing narrative in recent reporting in most media outlets. ...

INTRODUCTION

The Association of Community Organizations for Reform Now, best known by its acronym ACORN, is the nation’s largest community organization of low- and moderate-income families, boasting 400,000 members across 1200 chapters in 100 cities. Founded in 1970, ACORN works on a variety of issues of concern to its low-income membership, including raising the minimum wage, comprehensive immigration reform, paid sick days, Gulf Coast recovery, and affordable health care. Chief among its priorities has been affordable home ownership for low- and moderate-income neighborhoods.

Seeing a substantial increase in lending practices that set homeowners up to fail and lose their homes and equity, ACORN founded its Financial Justice Center in 1999 to serve as a hub for members’ work to correct these abuses. ...

Download ACORN and John McCain: The Real Story of the Financial Crisis - 1999 to 2008

PDF format, 1.9MB, 13Pages.

ABOUT THE AUTHOR

Austin King is the director of the ACORN Financial Justice Center, the central hub through which ACORN’s 400,000 members fight back against predatory lending, foreclosures, payday lending, refund anticipation loans, and other financial abuses. Prior to joining ACORN, King served as President of the Madison, WI City Council.

Visit ACORN Official Website

ACORN, the Association of Community Organizations for Reform Now, is the nation's largest community organization of low- and moderate-income families, working together for social justice and stronger communities.

CONCLUSION
Comparing the records of both ACORN and Senator John McCain, the only available conclusion is that in the decade leading up to the financial crisis America faces today, ACORN fought with all its might against the predatory lending practices and resulting foreclosures that triggered the crisis, while Senator McCain took no actions to stem the crisis while voting for deregulation schemes that enabled the crisis. His reckless accusation that ACORN is responsible for the crisis shows a Senator who is demonstrably out of touch with the reality of the nation’s economic problems. After all, as recently as mid-September, Senator McCain was still arguing that, “The fundamentals of our economy are strong.”

Though it may seem intractable, the solution to the nation’s economic woes is to dramatically reduce foreclosures through mass modifications of unaffordable, predatory loans into fixed-rate, affordable loans. This can be done in a variety of manners, especially with increased governmental ownership of assets and institutions resulting from the bailout. Reducing foreclosures will stop the glut of REO property that has flooded the market, in turn stabilizing housing prices and enabling the mortgage-backed securities to be properly valued, which would return liquidity to that part of the market where the credit crunch originated. If Senator McCain does not understand how this crisis began and grew, it is doubtful that he is equipped to solve it, but ACORN will always be happy to educate him with its wealth of knowledge and experience on the issue.

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