American homes have lost $7 trillion in value over the last five years and four million homeowners are either behind on their payments or in foreclosure, but thus far, the Republican Party’s leading presidential candidates have offered little in the way of solutions for the housing crisis that is holding back the economic recovery. Few states have been hit harder than Florida, where prices have dropped 45 percent since 2006, half of recently-sold homes are in default, and 23 percent of of homes are delinquent or in foreclosure.
That made last night’s debate, which was held in Jacksonville, the appropriate place to ask the remaining Republican candidates how they would address the crisis. Voters, in fact, were waiting to hear the candidates’ answers.
Unfortunately, the debate’s moderator, CNN anchor Wolf Blitzer, bungled his opportunity, turning to a submitted question that couldn’t have possibly led to substantive answers from the candidates. And then, after Newt Gingrich and Mitt Romney gave answers littered with falsehoods and turned the discussion toward each others’ investment portfolios, Blitzer failed to press them for actual plans to deal with housing:
BLITZER: We have a very important subject: housing. Not only here in Florida, foreclosures really, really bad, but all over the country. A lot of people are wondering if the federal government contributed to the housing collapse in recent years. We got a question that came into us. Let me put it up there and I’ll read it to you: How would you phase out Fannie Mae and Freddie Mac? Does the private mortgage industry need additional regulation?
Blitzer’s original question focused on what the candidates would do with Fannie Mae and Freddie Mac, the government-sponsored mortgage firms that have been targets of Republican ire since the crisis began. But it was private industry, not Fannie and Freddie, that sparked the crisis. More than 84 percent of the subprime loans in 2006 were issued by private lenders, including 83 percent of the loans that went to low- and moderate-income borrowers.
Blitzer could have asked Republicans to address the misconception that Fannie and Freddie sparked the housing crisis. He could have pressed Romney on what seemed like a change of position on housing in Florida. He could have asked where the candidates stood on the plan President Obama put forward in his State of the Union address to refinance mortgages, or asked what the candidates would do about the rampant fraud and abuse that private lenders perpetuated during both the housing boom and its subsequent bust. And yes, he could have pressed Romney to find out how much he knew about his investments into funds that profited off of Florida foreclosures.
But he didn’t. The result, as Reuters noted today, were soft outlines of policies that “could prolong the pain for years,” aren’t supported by market data, and showed little understanding of how the crisis happened in the first place. The Republican candidates continue to dodge questions about what, specifically, they plan to do about the housing crisis. Unfortunately for voters, questions like Blitzer’s only make it easier for those dodges to continue.