Obama Must Choose on Housing: A Sweetheart Deal for the 1% or a Fair Deal for the 99%

[FreakinDJ]

Rumor has it that on Monday, after months of negotiation with big banks, the White House may announce a settlement that would let the banks off the hook for their role in the foreclosure crisis -- paying a tiny fraction of what's needed in exchange for blanket immunity from future lawsuits.

We hope these rumors are untrue.

President Obama has the ability to stop and change the direction of this sweetheart deal. He should reject any deal that benefits the one percent and lets the big banks get away with their crimes. Instead, the president should stand with the 99 percent and push for real accountability and a solution that will help millions of people in this country.

Here are the hard facts about the housing crisis we face:

3.5 million Americans are homeless.
18.5 million homes sit vacant.
Since 2007, more than 7.5 million homes have been foreclosed.

http://www.huffingtonpost.com/van-jones/obama-housing_b_1221921.html

[Swede]

1. Ira Rheingold, executive director of the National Association of Consumer Advocates

It would mean bringing in new sets of players and, most important, putting on indefinite hold a settlement plan that would both help fix a broken foreclosure system and force lenders to sit with individual homeowners to work out a loan modification. That’s a plan that old warriors in the fight like Ira Rheingold, executive director of the National Association of Consumer Advocates, wish Schneiderman would get behind.


“He’s probably right that his approach would get more money, but that’s not the most important thing for people like me,” says Rheingold, who has been battling predatory subprime lenders dating back to his days as a Legal Aid attorney in the 1980s. “It’s fixing the damn system. It’s making sure people who can save their homes have the right to save their homes.” Then, with the sigh of someone who's been engaged in the same fight for a very long time, he adds, “I think sometimes we lose sight of what’s possible to achieve.”


http://www.thedailybeast.com/articles/2011/10/05/is-eric-schneiderman-s-ego-sabotaging-bank-reform.html

[Hell Hath No Fury]

2. This is what pragmatism gets you.

Which is why I am a "purist".

[Occulus]

3. You just never really loved him.

Do you want President Gingrich?

/preempt

[AnotherMcIntosh]

5. A "purist"? Good for you.

[SunsetDreams]

4. "Rumor has it that on Monday"

Rumor has it that on Monday DU Grovelbot will return!

I'll just wait for Monday to see if the Rumors are true.

[Nuclear Unicorn]

6. These ultimatum articles are becoming farcical

And that's not to take fault with the OP. The OP very correctly notes that we have nearly 3 vacant homes for every homeless American. That's the tragedy and I can't help but wonder if there isn't some way to rationalize, even with the profit-motivated, to getting folks off the street and into homes.

Maybe this is just some wild-eyed spit-balling on my part but if I owned a load of vacant homes I'd want those properties maintained cheaply until they could be sold-off. Heck, I'd even be willing to offer an entire family the opportunity to move in, maintain it, improve it and then give them a percentage of the sale profit to incentivize their behavior. They could then take their share of the profit get themselves something more for themselves or they could continue the process as a cottage industry of sorts. Who knows, they might even be salaried as property managers.

But this "Obama must choose" verbiage is just silly.

What will the author do if Obama chooses the wrong way? Nothing. So what does it matter which way Obama chooses? Nothing. It's all theatre of the sort one sees when a parent scolds a child with empty threat and the child, as a point of control, openly disobeys.

Supposedly the bailouts were meant to recapitalize under-capitalized institutions. If their assets were too low that would prompt further capital loss, i.e. a run on the banks. That would deepen the lack of capital. Business loans, consumer credit, etc would dry-up and the economy would grind to a halt. It sounds reasonable -- on paper -- but practice is another matter altogether as we have seen. I disapprove of the bailouts but I understand the stated intent.

If that was the intent, and that is the intent stated by Obama, it would be naive to think he will see these institutions DE-capitalized with lawsuits and punitive damages. Obama isn't going to give with one-hand and take with the other if he was convinced in the first place his action was the best one to take. It would be naive if it weren't so silly. We can mount a thousand arguments as to why it may have been a poor policy but unless we are convinced beyond argument that Obama acted out of malfeasance we must admit Obama personally believes he acted out of pragmatism and probably reluctantly at that.

Again, that just speaks to the emptiness of the headline. If Obama was engaging in crony capitalism then why bother with ultimatums. Whether or not Obama gets this particular decision right is trivial compared to the declaration that we should support someone we believe to be a crook even if sometimes he makes us happy. If we believe Obama makes well-intentioned even if occassionally bad decisions then we should not speak in overtones of demand with possible consequences but with ongoing encouragements even when disappointed lest we encourage others to abandon him.