Two pieces on the topic of the housing crash and possible mortgage bailout appeared on TomPaine.com recently.

This caught my eye because of the interesting contrast, as one paints Barney Frank as the problem, and the other paints him as championing the solution.

This editorial:
The Housing Crisis and The Plague of Potomac Fever | OurFuture.org

As states move to crack down on predatory lending and abusive mortgage fees, lawmakers like Rep. Barney Frank, D-Mass., have been telling reporters "it's irrelevant" how many—if any—homeowners are ever helped by anything Congress does in reaction to the housing crisis. As state legislators use their platforms to demand serious aid to borrowers, Washington moves to construct a bailout for financial firms.

This is the contrast between minimally healthy (though certainly imperfect) democratic systems in the states, and a federal government ravaged by Potomac Fever—the illness whereby professional politicians forget who they were elected to serve.

And this article, suggesting there may be help on the way. The whole program would cost all of $6 billion, or roughly what we throw away in Iraq every 10 days, and likely actually MAKE the government some money. It's sensible and would help regular people, so of course, Bush opposes it:

House panel passes sweeping mortgage aid bill | U.S. | Reuters
WASHINGTON (Reuters) - The House of Representatives Financial Services Committee on Thursday approved a sweeping bill to enable the government to finance $300 billion in distressed mortgages with the aim of helping 2 million homeowners.

Under Frank's plan, the homeowner and federal government would both reap a windfall if home prices increased in the first years after the FHA finances a loan. Mortgage investors, though, would be cut out of home price gains.

Progress is being made.
The plan makes sense, won't cost much, and will help people... so of course, W plans to veto. Bailing out Bear Stearns, A-OK. Helping the American people, no way.

washingtonpost.com

The House yesterday approved an ambitious plan to rescue hundreds of thousands of homeowners at risk of foreclosure by helping them trade exotic loans with rapidly rising monthly payments for more affordable mortgages backed by the federal government.

Bucking a White House veto threat, 39 Republicans joined Democrats in supporting the bill, the centerpiece of a broader housing package that represents Washington's most aggressive response to the nation's housing crisis.

Under the proposal, lenders would have to take a significant loss, permitting borrowers to pay their original loans with new loans worth no more than 90 percent of their homes' new, lower value. Extra fees charged by the FHA would lower the payoff to lenders to 85 percent of a home's current value.

Borrowers would get lower monthly payments and an immediate equity stake in their property. If home values rise, the plan requires homeowners to share their profits with the federal government when they sell or refinance.

The Congressional Budget Office estimates that as many as 500,000 homeowners will benefit from the program. But more than a third of those borrowers are likely to default, the CBO estimates, forcing the FHA to pay off their loans and take possession of their property at a cost to taxpayers of $1.7 billion.

I feel good knowing that the bank I represent helped people like the Villareal family during the mortgage crisis through ShoreBank's Rescue Loan Program (read the story here: ShoreBank -- Let's change the world) It's good to know that strong social responsibility is still around in the financial world.

The gays are responsible for the current financial crisis. Gay marriage is having a global impact on the world's economy too.

I think congress is scared. More people say let them fail....and help the mortgage holders.

I say, let them fail. This is an election year...no more corporate welfare.

From John Boehner's site:

http://republicanleader.house.gov/Ne...umentID=103884

On ACORN & LaRaza In Econmic Bailout
So how exactly will ACORN be rewarded if the Democrats get their way? Very simple: behind closed doors, ACORN-friendly language was slipped into the Democratic economic rescue proposal by Senate Banking Committee Chairman Chris Dodd (D-CT) and House Financial Services Committee Chairman Barney Frank (D-MA). Take a look:

TRANSFER OF A PERCENTAGE OF PROFITS.



1. DEPOSITS. Not less than 20 percent of any profit realized on the sale of each troubled asset purchased under this Act shall be deposited as provided in paragraph (2).

2. USE OF DEPOSITS. Of the amount referred to in paragraph (1)

1. 65 percent shall be deposited into the Housing Trust Fund established under section 1338 of the Federal Housing Enterprises Regulatory Reform Act of 1992 (12 U.S.C. 456; and

2. 35 percent shall be deposited into the Capital Magnet Fund established under section 1339 of that Act (12 U.S.C. 4569).



REMAINDER DEPOSITED IN THE TREASURY. All amounts remaining after payments under paragraph (1) shall be paid into the General Fund of the Treasury for reduction of the public debt.

What does this mean? The Wall Street Journal breaks it down in an editorial published today:

“What we have here essentially are a pair of government slush funds created in July as part of the Economic Recovery Act that pump tax dollars into the coffers of low-income housing advocacy groups, such as Acorn.”



“Acorn, one of America’s most militant left-wing ‘community activist groups,’ is spending $16 million this year to register Democrats to vote in November. In the past several years, Acorn’s voter registration programs have come under investigation in Ohio, Colorado, Michigan, Missouri and Washington, while several of their employees have been convicted of voter fraud…”

That’s right. Rather than returning any profits made in the long-term from the economic rescue package, Democrats want to first reward their radical allies at ACORN for their help – often illegal help – in getting Democrats elected to office. Families, seniors, small businesses, and all American taxpayers deserve better than what Democratic leaders are attempting to jam down their throats.


The rescue package should not become a “Christmas tree” for the Democratic Majority’s far-left wing political agenda that seeks to shower taxpayer dollars upon groups like ACORN. On behalf of beleaguered taxpayers across the nation, House Republicans will continue to fight to remove the ACORN payback and any other Democratic poison pills from the economic rescue package.

Freakin criminal.

If the financial corporations need an influx of money then the best option for the federal government would be to pay off home loans that are near completion for those Americans that bought and paid loyally following the rules. Those home owners would then have disposable income and the financial institutions would have $700 billion dollars and no one that was dumb in public would be rewarded.