Housing Boom and Bust (Part 4 of 4) - Thomas Sowell

This book explores political and economic causes of the American housing crisis. For example, he links the Community Reinvestment Act to decreased lending standards that resulted in an increase of subprime mortgages, as the law forced banks to set up quotas of lending to minorities. As a result, "lenders had to resort to 'innovative or flexible' standards."  He also contrasts housing prices for modest middle-class homes in California and Texas and theorizes that California, with open space and various other zoning laws, had homes that were more expensive than those of similar size in Texas, which lacks such laws. Politically, Sowell targets the George W Bush administration and Congress members of both major political parties for obstructing audits of Fannie Mae and Freddie Mac and enabling banks to make highly risky housing loans.