When a major subprime mortgage lender collapsed earlier this year liberal advocacy groups went on the attack. Claiming that the subprime industry is “predatory” when it lends money to people who have low incomes or bad credit, the critics demand a federal crackdown. Lenders reply that subprime loans help less creditworthy borrowers buy homes and cars and even necessities like groceries when a borrower can’t wait for the next paycheck. They say they must charge higher interest rates because they assume a greater financial risk. But these arguments fall on deaf ears. Left-wing advocacy groups see an opportunity to bash the industry—and they are taking it.
