Or as Thomas Frank might say, “what’s the matter with Cleveland?”
As I mentioned in my cheap housing in the Rust Belt story last week, Cleveland is ground zero for foreclosed housing and the sub-prime mortgage crisis in the United States. Ten percent of the city’s houses stand vacant. Four of the top 21 zip codes for foreclosure are in the Cleveland metro area, including first place 44105. How did this happen?
This week, Money magazine told us how. Blame Rust Belt economics and the population drain in part, but also predatory lending practices, such as “toxic ARMs,” that put people in houses they had no business buying. Banks apparently have a lot of clout in the Ohio legislature, and have blocked reform and regulation efforts. Certainly no one wants to be denied the “chance to own the ‘American Dream,'” (in Cleveland?), but sometimes people need to hear “no” for their own good.