Because the federal government was requiring that some lenders make loans to people who couldn’t afford them.

In 2004, as regulators warned that subprime lenders were saddling borrowers with mortgages they could not afford, the U.S. Department of Housing and Urban Development helped fuel more of that risky lending.

Eager to put more low-income and minority families into their own homes, the agency required that two government-chartered mortgage finance firms purchase far more “affordable” loans made to these borrowers. HUD stuck with an outdated policy that allowed Freddie Mac and Fannie Mae to count billions of dollars they invested in subprime loans as a public good that would foster affordable housing.

Housing experts and some congressional leaders now view those decisions as mistakes that contributed to an escalation of subprime lending that is roiling the U.S. economy.

So what do we do?  Create another government program to fix the problems created by this government program?  Or should we just admit that the government has no place deciding who should and should not get home loans?

Meanwhile, some in this country still want to put these same short-sighted, dim-witted bureaucrats in charge of a nationalized health care system.