Rep. Wilson Clueless That McCain Has Flipped On Housing Plan, Desperately Insists, ‘That’s Not The Proposal’

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"Rep. Wilson Clueless That McCain Has Flipped On Housing Plan, Desperately Insists, ‘That’s Not The Proposal’"

Since Sen. John McCain (R-AZ) introduced his Home Resurgence Plan during the most recent presidential debate, the campaign has been caving to the angry right wing and changing the initially progressive plan.

Yesterday on MSNBC’s Hardball, Rep. Jim Moran (D-VA) brought up this plan in a heated exchange with Rep. Heather Wilson (R-NM), a McCain surrogate, who clearly hadn’t been clued in to the changes. She kept insisting to Moran, “Jim, you know that’s not the proposal”:

MORAN: Well, what I want to tell you is, this is insane. What Senator McCain would do is to have the federal taxpayer buy every bad loan at 100 percent of value, and then guarantee it.

WILSON: Jim, you know that’s not the proposal. [...]

MORAN: His plan would pay 100 percent of the mortgage’s value. These mortgages are trading at 50 percent, sometimes 20 percent of value. Why should the taxpayer pay 100 percent, rewarding the banks themselves? That’s the problem. They’re not worth…

WILSON: No, Jim, mortgage-backed securities are trading at that low level.

MORAN: Look at the plan, Heather.

Watch it:

Moran is right; Wilson needs to read the new McCain plan. On Tuesday night, McCain appeared to argue that lenders should sell the mortgages of struggling homeowners to the government at a discount, rather than their face value — thus forcing lenders to foot the loss.

By Wednesday, McCain had significantly modified his proposal, shifting the cost of the plan from the lenders and onto taxpayers. Under his new plan, McCain would pay each lender the full face value of each mortgage, amounting to a $100 billion boondoggle for lenders who made bad loans.

Transcript:

MATTHEWS: Congressman — Congressman Moran, how does this war over the economy — I mean, we’re on, like, the Titanic, it seems. It just keeps sinking. Every afternoon, we get the bad news.

MORAN: Yes, the market is crashing. This is a stock market crash, and it’s in the middle of a recession. We’ve got to present — a global depression. But with regard to this plan, Chris, of course, you know, we’ll probably have a new plan next week, because we’ve had three different plans in about three weeks.

MATTHEWS: What, do something like Senator McCain wants to do?

MORAN: Well, what I want to tell you is, this is insane. What Senator McCain would do is to have the federal taxpayer buy every bad loan at 100 percent of value, and then guarantee it.

What we passed was legislation that said, if a bank is willing to write down the loan as much as 15 percent and make the terms so that the homeowner can pay them, then, in return, we will guarantee that loan.

That’s what the Treasury Department can do. It’s what Fannie Mae and Freddie Mac can do. We’re already doing that.

But to say we will buy up every bad loan in the country for hundreds of billions of dollars?

What we are doing is rewarding the very people…

WILSON: Jim, you know that’s not the proposal.

MORAN: … that shouldn’t have made these loans in the the first place.

MATTHEWS: What is the proposal, Congresswoman, that McCain is offering in this regard?

WILSON: The proposal is to look at people who, through no fault of their own, end up upside down on their mortgages, where they’ve got a down payment, where they had good credit, didn’t lie on their forms, and they end up with a house with a bigger mortgage than what it’s worth.

I think that those folks should be a priority, to work out that mortgage rather than just defaulting on it, declaring bankruptcy, so they can stay in their homes. And that is part of the bill.

MATTHEWS: Well, isn’t this the story…

(CROSSTALK)

MATTHEWS: I thought that that was what he was proposing.

(CROSSTALK)

WILSON: So let’s focus on keeping people in their homes and not on Wall Street.

MORAN: His plan would pay 100 percent of the mortgage’s value. These mortgages are trading at 50 percent, sometimes 20 percent of value. Why should the taxpayer pay 100 percent, rewarding the banks themselves? That’s the problem. They’re not worth…

(CROSSTALK)

WILSON: No, Jim, mortgage-backed securities are trading at that low level.

MORAN: Look at the plan, Heather. [...]

MATTHEWS: Generally speaking, are the Democrats pro-regulation, the Republicans anti-regulation, Congresswoman, generally speaking?

I thought Republicans were laissez-faire, less government in our lives, less regulation, less taxes. I thought that was your party philosophy?

WILSON: In general, that is true. But it was Republicans in the Congress and also the administration that said we need to change the way in which we monitor and regulate these institutions, and we need to tighten up on Freddie and Fannie.

And it was Democrats in the Congress who said, no, we think this fine, including a guy named Senator Barack Obama.

MORAN: This administration filled every regulatory post with somebody that had an anti-regulatory bias. And that’s why we’re in the situation we’re in.

MATTHEWS: Thank you, Jim Moran…

WILSON: The heads of Freddie and Fannie are supporting Barack Obama and have given more to his campaign…

MORAN: That’s not a regulatory agency.

WILSON: … than any other senator in the last 20 years.

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