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With all the research that has been amassed over the past few years, and all the whistleblowers and others who have given depositions, all the homeowners and expert witnesses who have given testimony, lawsuits launched by county recorder’s offices and AGs across the country, it boggles the mind to think anyone, but especially someone vying for a leadership role in our country would choose not to address the biggest financial crime in the history of the world,…nary even breathe a word about bringing the perpetrators to justice. The silence is deafening from both sides of the aisle. Guess it’s never wise to bite the hand that feeds you.
The Political Dance
Louis J. Willie III, Esq. firstname.lastname@example.org
It’s hard not to speak in political terms when addressing the tumultuous housing crisis which has thrown so many homeowners into foreclosure. On the one hand, you have the GOP field of presidential hopefuls who for the most part are espousing a hands-off approach. On the other, you have the Obama administration practically falling over itself to find a solution, with Democrats from around the country still berating the President for not doing enough.
William Boone, associate provost and dean of graduate studies at Clark Atlanta University, said, ” a common theme of all the candidates (GOP) is that government’s job is to get out of the way.”
Whether listening to the shot-in-the-dark hopeful, Paul, or the current front-runner, Romney, the sentiment seems to be essentially the same:
Ron Paul – “Government should enforce contracts, not undermine them,” in regards to foreclosures.
Mitt Romney – “Allow the foreclosure situation to run its course and hit bottom, after which the housing industry will recover. The right course is to let markets work.”
Instead of directly addressing what may be THE most significant problem in our economy today, the GOP hopefuls prefer to point fingers at the specter of government regulation, and seem to actually believe – at least for now – that less regulation will help to draw the country out of this crisis.
Activity in state legislatures around the country seems to be equally out of sync with the reality of the situation. House Democrats in Minnesota are proposing sweeping protections for struggling homeowners and a crackdown on questionable lending practices. Yet, even its supporters admit it’s probably not going to happen this year, but in a state where an estimated 21,000 people lost their home to foreclosure last year, they say it’s worth the effort to start a dialog.
Oregon homeowners have been spun into the twilight zone by the machinations going on its State House. After a comprehensive series of foreclosure protections introduced in the House was killed by Republican Leadership, a package of meaningful reforms to address the housing crisis passed the Oregon Senate with overwhelming bipartisan support.
After signaling no intention of moving that package, House Republican leadership introduced an amendment to the package late Monday afternoon that would unravel many of the provisions and undo some of the few financial protections that currently exist.
“We need to act now to protect Oregon’s middle class who are underwater on their homes or at risk of foreclosure,” said Rep. Brad Witt (D-Clatskanie), who introduced one of the original bills in the House to crack down on fraud and abuse in the mortgage tracking system.
“Any stalling, bogging the bill down, or attempts to go backward on foreclosure protections need to be called for what they are,” said Witt. “These legislative negotiations are following their own version of dual track: House Republicans have been blocking the bills and pushing giveaways to the banks while simultaneously pretending they’re trying to help homeowners.”
In his State of the Union address, President Obama laid out a Blueprint for an America Built to Last, calling for action to help responsible borrowers and support a housing market recovery. While the government cannot fix the housing market on its own, the President believes that responsible homeowners should not have to sit and wait for the market to hit bottom to get relief when there are measures at hand that can make a meaningful difference.
Obama has unveiled more than half a dozen plans in recent months to help millions more Americans refinance their mortgages at low rates, to reduce the debts owed by struggling homeowners and to expand existing programs to broaden the pool of borrowers eligible for government aid. The latest initiatives, announced this week, seek to help members of the military and Americans who have government-insured mortgages.
In recent months Obama has used his pulpit to discuss housing far more than earlier in his term. After rarely mentioning the nation’s housing problems for several years, the president is directly confronting the issue, which he has called the “most stubborn” of his presidency.
Obama’s aides say the president has urged his staff to release the new proposals as fast as possible. This aggressive push reflects a heightened concern that weakness in the housing market, with millions of people owing more than their properties are worth, remains one of the preeminent drags on the fledging economic recovery, aides say.
We can only hope that the partisan rhetoric dies down long enough for there to be some reasoned, and rational, discussion of this issue. Far too many homeowners have lost their homes already, and millions more are on the cusp of foreclosure. Let us not stand idly by as our neighbors are affected, for tomorrow it may be us.
GOP rivals silent on foreclosures
Don Stewart has lived comfortably in his Conyers home for 38 years. But when he looks out his window now, the 80-year-old Southern Bell retiree shudders.
“Look. One. Two. Three. Four foreclosed homes I can see from right here,” Stewart said. “And they are all empty. It is scary. Frightening.”
It is a frightening situation throughout Georgia. The state’s foreclosure rate continues to be one of the highest in the country, and critics from Capitol Hill to metro Atlanta have blasted President Barack Obama’s fixes as ineffective. Now, with Super Tuesday looming, Georgia residents, policy wonks and economists are looking to the GOP presidential candidates for answers.
But among the candidates — Newt Gingrich, Ron Paul, Mitt Romney and Rick Santorum — the housing crisis has taken a backseat to broader economic issues and discussion of social issues.
“I think Newt has addressed it; I heard him talk about housing a few times,” Stewart said. “But I don’t think any of them have addressed it to the point where it needs to be. They could address it more if they wanted to; I just don’t think they know how.”
William Boone, associate provost and dean of graduate studies at Clark Atlanta University, said a common theme of all the candidates is that government’s job is to get out of the way.
“If we were to project, based on their current statements, they will say you have to tough it out and get by using market forces instead of depending on the government,” he said. “They claim that the cause of the problem is government regulations, so we need more deregulation to let the market work its will.”
None of the campaigns responded to calls and emails from The Atlanta Journal-Constitution requesting information about the candidate’s policies on housing and foreclosures.
In October, Romney said that, as president, he would allow the foreclosure situation to “run its course and hit the bottom,” after which the housing industry would recover. “The right course is to let markets work,” he said.
Romney also has tried to drop the housing crisis directly in Gingrich’s lap, assailing Gingrich’s work for Freddie Mac, a federal mortgage agency. Gingrich, who was paid $1.6 million by Freddie Mac, has denied that he lobbied for the agency, saying he worked as a consultant and historian.
Both Gingrich and Romney have railed against the 2010 financial regulatory overhaul known as Dodd-Frank, on the grounds that it has actually worsened the crisis.
On Paul’s campaign website, he says that “government should enforce contracts, not undermine them,” in regards to foreclosures.
Santorum, while critical of Fannie Mae and Freddie Mac’s actions during the boom that preceded the crash, last week blamed the recession on high energy prices rather than the housing bubble.
Georgia has the fourth highest rate of foreclosures nationally. In January alone, 12,467 homes — about 1 in 328 — were the subject of foreclosure filings, according to recent data from real estate research firm RealtyTrac.
With 4,600 government-owned foreclosed properties, metro Atlanta has more than any other in the country, including poster children of the real estate collapse such as Phoenix and Las Vegas. Among states, Georgia ranks second only to California.
“Without addressing the foreclosure issue, we are not going to stabilize the housing market and approach stabilizing the banking industry. All of it is inter-related,” said David Ellis, executive vice president for Greater Atlanta Home Builders, a trade organization for the residential housing and construction markets.
“None of them [the candidates] have distinguished themselves on the issue,” Ellis said. “We clearly will be watching to see which one develops a cogent policy related to housing.”
In other post-World War II recoveries, the housing sector generally led the way, said Andy Carswell, an associate professor of housing and consumer economics at the University of Georgia. But today’s housing market weighs on Georgia’s economic recovery like a ship’s anchor.
“We’re a top foreclosure state,” Carswell said. “You’d think this would be an issue that they’d address.”
Georgia lost 14,000 jobs from December 2010 to December 2011. But the state would have enjoyed a net increase of more than 1,000 jobs without the losses in the construction and financial services sector — losses driven by the housing slump — said Mercer University economist Roger Tutterow.
Eventually, foreclosures are bound to surface as a campaign issue, he said, but perhaps not until the fall. “We’ve seen kind of cursory discussions on housing and foreclosure, but we haven’t seen it elevated in importance as you’ll see later in the cycle,” Tutterow said.
Not every economist is eager to see the candidates concentrate on the real estate crisis, however.
The broader matters being discussed in the GOP primaries — entitlement reform, reducing government deficits and overhauling the tax code — could mean more to the economy in the long run, said Dorsey Farr, an economist and partner at the Buckhead investment advisory firm French Wolf & Farr.
The Obama’s administration has devoted a lot of resources to housing with mixed results, Farr said.
The debate “ought to be about more than one sector of the economy and how we can get it going,” he said.
Atlanta-based real estate agent Tal Kramer agrees that nothing done thus far to stem the foreclosure tide has lived up to its promises, leaving millions of families still foundering — but he still wants the candidates to talk more about housing.
Kramer, with Atlanta Communities Real Estate, said 65 percent to 70 percent of his firm’s business relates to foreclosed properties and short sales.
The housing bust “hurts the economy overall,” Kramer said. “But I’m the first to admit there are no simple answers.”