Bush Housing Chief Rips McCain’s Mortgage Plan: ‘I Have A Very Grave Concern About That’
Bush Housing Chief Rips McCain’s Mortgage Plan: ‘I Have A Very Grave Concern About That’
During the Oct. 7 presidential debate, Sen. John McCain made a surprising policy announcement. After long claiming that it was “not the duty of government to bail out and reward those who act irresponsibly,” McCain said he would “order the secretary of the treasury to immediately buy up the bad home loan mortgages in America and renegotiate at the new value of those homes.”
McCain’s initial plan would have forced lenders to “recognize the loss that they’ve already suffered,” but he flip-flopped overnight to place the bill back on the taxpayers. His plan now rewards bankers who made bad loans by directing the federal government to buy bad mortgages at their original market value, instead of at their current depreciated value. Here’s how McCain’s proposal works:
– If a homeowner bought a house for $300,000 – and the value then fell to $200,000 – McCain would have the government purchase the mortgage for $300,000, instead of forcing lenders to accept the loss and renegotiate the loan.
– The only way in which the government then makes a profit is if the house’s value rises above its original market value of $300,000, which is possible, but unlikely.
McCain’s housing plan is so bad that even the Bush administration won’t endorse it. Steve Preston, Bush’s Secretary for Housing and Urban Development, criticized McCain’s plan last night:
Republican presidential candidate John McCain’s plan to have the government pay the difference between the balances of troubled mortgages and what homes are now worth is troubling, the secretary of Housing and Urban Development said Monday evening.
“I have a very grave concern about that,” said Steve Preston, who took over at HUD in June after leading the Small Business Administration.
In response to a question during a forum at Town Hall in Seattle, Preston said the problem is that the plan would put the loss on taxpayers, “when the financial institution took that risk.
“I don’t think we can suffer that big of a loss. … That is not invested money. That is just a loss.”
Preston is right. Instead of having the lenders take a haircut in order to avoid mass foreclosures, “McCain wants the taxpayers to bear all the costs of doing so.”
And yet, on the campaign trail, McCain hypocritically rails against others for engaging in “socialism.” McCain’s version of socialism involves having the public accept the losses when the private market fails.
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In two weeks, McCain will be shipped back to the Senate where he will become even more irrelevant as a minority Republican…
I can hardly wait.
October 21st, 2008 at 10:26 amMcCain said he would “order the secretary of the treasury to immediately buy up the bad home loan mortgages in America and renegotiate at the new value of those homes.”
He got the initial idea from something Hillary Clinton said (which is why he couldn’t elaborate on the concept at the time he frst uttered it).
He phoned her to attempt to get her to spill her policy ideas, but when she wouldn’t, he instead concocted this nightmare.
Pathetic.
October 21st, 2008 at 10:30 amThis guy is a little late in expressing his concern, isn’t he?
I think McNumbNuts has moved on to Economic Recovery Plan Version 8.5 by now. Besides, this election isn’t about policy or ideas. It’s about “pallin’ around with terrorists”.
How dare this government official try to change the subject?
October 21st, 2008 at 10:33 amSo the goosestepping lockstep Bush unitary executive branch isn’t supporting the candidate from the same party ?
But even more it was “not the duty of government to bail out and reward those who act irresponsibly,” BUUUUUTTTT we’re bailing out the companies that acted irresponsibly ?
October 21st, 2008 at 10:38 amThis proposal is even dumber than it at first appears.
Not only is the idea to buy a ‘used product’ at a brand-new price, the money to make the purchase comes in part from those who still own the used product (and in part from those who don’t own the product because they couldn’t afford it in the first place).
AND the idea is that everyone would be forced to make this ridiculous purchase, via the taxes they are all obliged to pay.
McCain clearly has had no involvement in his own economic proposals as he obviously doesn’t comprehend even this simple example, and he has no time now to craft anything that will even pander to the public economic interest, let alone craft a rational workable economic policy.
Obama spent six minutes explaining one aspect of his economic policy to Joe the Plumber; all McCain has ever said is “My, friends, I’ll cut taxes and I know how to fix the economy.”
October 21st, 2008 at 10:46 amBush Housing Chief Rips McCain’s Mortgage Plan: ‘I Have A Very Grave Concern About That’»
– - How Mavericky!! Yet another example of where McMaverick disagrees with BushCo.
October 21st, 2008 at 10:47 amSo the government now buys up speculation losses?
October 21st, 2008 at 10:48 amThat’s not maverick, that’s just stupid.
We all have a lot of “grave” concerns about McCain…
Like he could soon be in one.
(Not wishful thinking; he’s looking exponentially unwell.)
October 21st, 2008 at 10:52 amI forget which poster here it was that said it, and I may be paraphrasing a bit, but the gist is:
BUSH, REAGAN, MCCAIN, AND REPUBLICAN ECONOMIC THEORY IN A NUTSHELL:
Socialize Losses, Privatize Profits
October 21st, 2008 at 10:52 amHow can you elect a President who doesn’t even know how to haggle!?
October 21st, 2008 at 10:54 amThis is just as useless as McCain’s other ‘ideas’ regarding how to fix the economy.
October 21st, 2008 at 10:54 amRats, rats and more rats deserting the sinking McCain. I just pray that Bush doesn’t come out and endorse Obama.
John’s plan is more socialized than Obama’s ever was. Spread the debt around, welfare for the risky speculators.
I hope Obama states this clearly in the closing days of this campaign. And well wishes to the Obama family and Mrs. Dunham. Thank you, Senator, for crystalizing “family values.” We’ve got your back.
PEACE
October 21st, 2008 at 10:57 amAnd yet, on the campaign trail, McCain hypocritically rails against others for engaging in “socialism.” McCain’s version of socialism involves having the public accept the losses when the private market fails.
In McCain’s America everybody is a winner all the time because WE ARE AMERICANS! And, as a follow up proposal he will have the government reimburse casinos for any money they might have to pay out to gamblers. The only losers there can be are foreigners, because they weren’t smart enough to be Americans, said the Panamanian-born McCain!
October 21st, 2008 at 11:00 amWhen McCain was nominated by the Republican Party amid some very low rating for the current Republican president, I naturally assumed that he would attempt to distance himself as much as possible from the Bush administration.
Never did I dream that McCain would run such a crazy campaign that the Bush administration would be distancing themselves from him. But I see that’s what’s happening.
October 21st, 2008 at 11:06 amA Bush administration official criticizing McBane is the blind ignorant, incompetent, leading the blind, ignorant incompetent.
October 21st, 2008 at 11:08 amLook at all those rats jumping off that ship!
October 21st, 2008 at 11:13 amEverybody hates McCain
October 21st, 2008 at 11:14 amIs McCain’s idea truly socialism, or is it this:
Fascism also operated from a Social Darwinist view of human relations. Their aim was to promote “superior” individuals and weed out the weak.[63] In terms of economic practice, this meant promoting the interests of successful businessmen while destroying trade unions and other organizations of the working class.[64] Historian Gaetano Salvemini argued in 1936 that fascism makes taxpayers responsible to private enterprise, because “the State pays for the blunders of private enterprise… Profit is private and individual. Loss is public and social.”
http://en.wikipedia.org/wiki/Fascism
October 21st, 2008 at 11:31 amWhy does Bush have a liberal socialist commie homo guy talking about stuff and drawing paychecks?
October 21st, 2008 at 12:29 pmOOO.. the GOP is snacking on themselves again.
Let’s Win One For Grandma!! Get the word out!
October 21st, 2008 at 1:06 pmInteresting…
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April 1st, 2009 at 5:23 am