President Obama just got done announcing a plan to keep several million American families in their homes. Republican Congressional leaders Eric Cantor and John Boehner immediately drafted a letter to Obama which included the following 6 questions:
- What will your plan do for the over 90 percent of homeowners who are playing and paying by the rules? My reply: the 90 percent are not the problem. Let's provide veteran benefits for me, I never served but I would like the money. On a more serious note, why are you asking such a silly question? Play the politics of envy and greed, in order to undermine a plan which at least attempts to get a handle on the problem that started our economic slide, and which has to be successfully addressed if we are to avoid spending the next 5 years with a dead real estate market. Of course if the real estate market dies, that will help your chances in 2012. Next question, please.
- Does your plan compensate banks for bad mortgages they should have never made in the first place? Maybe, but so what? The homeowners are going bust, and so are the banks. They are both in a bad place, and the economy does not get better until they both get into a better place. By the way, what's your plan? Right, you do not have one.
- Will individuals who misrepresented their income or assets on their original mortgage application be eligible to get the taxpayer funded assistance under your plan? Maybe, but it is not going to be possible to kill this Beast without somebody being taken off the hook. The time to prevent this was years ago, back when you guys thought the banking system was doing wonderful things. Don't lie, you had nothing bad to say about Countrywide's ARMs back in the day.
- Will you require mortgage servicers to verify income and other eligibility standards before modifying mortgages? Look, the banks dug this hole, held hands, and jumped in. Bush tried for months to coax them into voluntary plans to end the foreclosure wave, and they mostly were just not interested. What do you want, to stand on principle, keep your hands clean, and watch the housing market die for the next five years? Yeah, we will check to see if the people have income, and we will not hand them $100,000 if they are penniless.
- What will you do to prevent the same mortgages that receive assistance and are modified from going into default three, six or eight months later? Nothing. Which is exactly what you did to prevent this mess, and exactly what you have done so far to fix it.
- How do you intend to move forward in the drafting of the legislation and who will author it? Obviously you will not author it. Why do you care who writes it, you are just going to sit back and take shots at it, the same way you dealt with the stimulus program. Have a nice day. When you are interested in non-partisan negotiation, let me know.
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Comments: 24
As far as Obama, he will tell us all we are doomed again if we don't fork over more bailouts for bums. 4 years can't come soon enough!
Actually Jenn, there are other plans out there that make far better sense. Im NOT a republican, so dont start that with me.
We are losing rights, challenging and going against the constitution, breaking relationships with foreign countries (China) and the whole thing is a mess. On top of that, Mexico is about to fail - becoming a narco state and in the meantime we have green freaks that want to spend 200 trillion on a "solar blocker". Not to mention the dissident states that are becoming a bit pissed about the strong arm they are getting from the feds.
Tie that in with California going bankrupt - paying tax refund checks and cops with IOU's...
and you have a very volatile situation.
Its gonna get bumpy.
~M
Chris I am convince that the housing market will be dead for 3 years and 11 months longer because of the bubble that was created in over-financing and low interest rates. Obama bailing out idiots at the expense of people who did everything right makes no sense and certainly won't change anything.
The most pathetic thing is that Obama just signed a trillion dollar bill that could find room to bail out fiscally irresponsible people who can't make their mortgage payment and now GM and Chrysler are back up with their hands out just as predicted by us ignorant jack-offs as Jennifer so elegantly put it.
Jennifer, I don't need to have a feeble minded twit who blindly supports a trillion dollar bill without even knowing what was in the bill to talk down to me. Want an alternative?
HERE IT IS
1. your link doesnt work. Sort of anticlimactic
2. dont call her a twit just because you disagree with her
3. 3 year and 11 months huh? That is pretty good guestimation... how'd you get to that number?
Both parties got us here. I think we're gonna tank before we get better.
I have a place to go to...so im not worried about it.
~M
but I digress. the foreclosure plan is the topic at hand.
#2 Ahh, the mantra of doing something, anything is better than a wait and see. The majority of banks/homeowners in the country are not at risk but we will borrow billions to help them. This in turn removes the future moral hazard for bad business mistakes, the government becomes the backer of bad economic moves by people and businesses.
#3 Right. No matter if you lied, hell we are the government-its a normal thing for us so why should it be held against anyone else? Again, blaming one party for this is way too simple. Yeah it makes it easier on your own party's consciousness but its been a bi-partisan mess in the making for years. ARMS were known to be risky loans but people still took them, bailing them out of their own stupidity is not a problem.
#4 The banks went along with the stupid policy to encourage risky loans sponsored by the government for years. We owe it to them for listening to us make poor business advice. That's actually more ammunition to step back and let them fall. If those banks fail, the shareholders get nailed but at least the taxpayers don't.
#5 Na Na Na Na...take that. That was enlightening.
#6 see above.
Luckily Obama is not that keen to publicly commit suicide. If he came out that open and said that, whats left of confidence in a near term recovery would collapse. If you want long term recovery, making noises like this will cause a monetary flood out of the county and dry up foreign investment. Obama's spendathon will crush us if the recovery doesn't start anytime soon. No economy will recover on government inflation alone.
#1- yes, my parallel was far fetched and contributed nothing
as to the rest of it, do I agonize over the issue of bailing consumers and an industry who both should have known better? Sure I do. But the agonizing does not fix anything, and the plan probably does. In my view, letting another 6 or 7 million americans get kicked out of their homes is too high a price for a principle. Our government should have known better. We all should have known better and demanded that our banking system be operated in a more logical manner, since we all depend upon it for our prosperity. But we all let it happen. So we are all left holding the bag.
But here's the thing. Being resentful at spending 75 billion on foreclosure prevention is okay, but if we allow those foreclosures to happen, the housing market is going to be dead. That's just how it is. The banks are saying don't worry we are fine, but several of them are going belly up every month and it is accelerating. That 75 billion is actually a bargain in terms of bang for the buck. The resentment is unproductive. We needed to be resentful in 2002, when our resentment could have been harnessed to preventing the foreclosure wave.
I don't know if that will be possible but, in this case at least, I'm taking the "if you can't beat 'em, join 'em" attitude.
This isn't a democrat or republican thing, it's a politician thing.
The rich will thrive;
The poor will survive
The middle class takes another dive.
Prices were over inflated and correction was overdue. It hurts many but keeping the bad loans afloat will hurt far more and for a longer period.