Jay Bryant writes this Tech Station Central piece in which he criticizes New York Aspiring Governor Eliot Spitzer‘s latest abuse of power — i.e., his investigation of some of the nation’s biggest banks to determine whether they had discriminated against minority groups in setting mortgage rates and fees in the sub-prime mortgage market.
The sub-prime lending industry provides the valuable service of lending money for home loans at higher interest rates to those who cannot qualify for a conventional mortgage because of insufficient income, lack of assets or credit problems. Of Mr. Spitzer’s latest foray into political image-making, Mr. Bryant warns:

[I]f Spitzer’s ominous letters are any indication, he is about to insert himself and his publicity-seeking machine into the sub-prime lending industry, and if he’s not careful, he could destroy it. [His investigation will likely] damage the industry, reduce the number of people it can profitably serve and scale back the growth rate in home-ownership.
As former Senator Sam Hayakawa famously observed, you can’t expect people to climb the ladder of success if you kick out the bottom rungs. That’s the central point about home ownership: that it provides, for people of modest means, the best opportunity they will ever have to build equity. For a great many of them, this equity will mean that before long they will be able to refinance their mortgage at a better rate, their newfound equity having served to improve their creditworthiness. They will, in other words, have moved up the ladder a few rungs. This sort of movement happens all the time.
The threat Spitzer represents is very real, but its victims are not the ones he pretends to threaten. If the bankers who got Spitzer’s letters don’t make money by sub-prime lending, you may be sure they will find another way to make it. But whether the low-income family trying to climb the ladder to prosperity through home ownership can find another way to make it — that is a much less likely proposition.