I
March 27, 2013
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Page 9
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Resetting the Housing Sector
Time for new
leadership at
finance agency
cial crisis rocked our economy, we
still haven’t done anything to ad­
dress one of the key drivers of the
crisis: the divorced-from -reality
overpricing of homes and mortgages
during the housing bubble.
Since the bubble burst, nothing
has been done to correct the pricing
distortions that were written into
mortgage contracts. The result?
J ean -M arie C aterina
and J ose G onzalez
by
Business groups with an axe to
grind against the Obama Adminis­
tration, like the U.S. Chamber of
Commerce and the National Federa­
tion of Independent Business, like
to push the idea that “uncertainty”
over governm ent actions is the
monkey on the econom y’s back.
As small business owners who
work in the housing sector, we don ’ t
buy that analysis.
The source of our continuing
economic problems is not some
vague cloud of “uncertainty.” It is,
quite the opposite, the very real
certainty that if we don’t do more -
and soon - to hit the reset button for
the housing sector, the economic
recovery will continue to fall short
of what we need to put millions of
unemployed Americans back to
work.
Almost five years after the finan­
A scientific survey of small busi­
ness owners nationwide commis­
sioned last year by three business
networks bears this out. In that sur­
vey, 73 percent of small business
owners said the drop in consumer
demand as a result of the housing
and mortgage crisis has hurt their
businesses (and 28 percent said it
has hurt a great deal).
simple answer. In two words or less:
Edward DeMarco.
As acting director of the Federal
H ousing Finance A gency, Mr.
DeMarco oversees Fannie Mae and
Freddie Mac. And in that capacity,
Mr. DeMarco has blocked all efforts
at resetting underwater mortgages.
Indeed, despite clear evidence
that writing down underwater mort­
would we give the keys back to the
same people who drove the economy
into the ditch in the first place?” was
the gist of his appeal.
Well, now h e’s got a guy driving
his administration’s housing policy
who, instead o f turning the key and
stepping on the gas to get the car
out of the ditch, seems more intent
on slashing the tires.
Especially with the gridlock in
the U.S. House and Senate over
economic issues, we need Presi­
dent Obama to do what’s in his
power to get the economy back on
track.
As small business owners and
real estate agents, w e’d suggest he
start by asking Mr. DeMarco to
hand over the keys to his office. It’s
gages to fair market value would be time to appoint a new FHFA director
good not only for homeowners but who w ill do w h a t’s rig h t for
also for Fannie, Freddie, and U.S. homeowners, small businesses, and
taxpayers, DeMarco has rejected all the economy by resetting mortgages
efforts to move this solution for­ to fair market value.
ward.
Jean-Marie Caterina is a real
Remember how, on the campaign estate broker from Maine, and Jose
trail, President Obama often used Gonzalez is principal broker at Tu
the metaphor o f driving a car to Casa Real Estate in Salem, Ore.
make his case for why he (and Demo­ Their commentary was provided by
crats) should be re-elected? “Why American Forum.
Especially with the gridlock in the U.S. House
and Senate over economic issues, we need
President Obama to do what’s in his power to get
the economy back on track.
Fourteen million Americans are un­
derwater in their homes.
This isn’t just holding back the
housing sector. A weak housing
sector drags the whole economy
down, and when consumers are
stuck shipping inflated mortgage
payments off to Wall Street ac­
counts every month, that drains
consumer purchasing power and
weakens local economies.
There is, o f course, a solution:
reset underwater mortgages to fair
market value. That will boost the
housing sector, bolster consumer
spending, and restore the dream of
home ownership for millions of
Americans who’ve been living an
underwater nightmare for the last
five years.
Why haven’t we implemented
this simple solution? T here’s a
_
....... ,
Sequestration more than an Inconvenience
Holding leaders
accountable
by
Sequestration, an element of the
Budget Control Act of 2011, was
meant to provide a way for the
so-called “super committee”
to reach a deal over a year
ago. But it didn’t happen.
We spent millions of dol­
lars to elect these national
leaders so I suggest that we
hold them accountable for making
responsible decisions that impact
millions of people.
It is unthinkable that we refuse to
tax the wealthiest and at the same
time continue to provide tax subsi­
dies to oil companies. It’s hard to
empathize with billionaires who will
not be inconvenienced by paying a
minimum tax on income over one
million dollars.
Once again, the m ost vulner­
M . L inda J aramillo ,
Y esterday, I heard a
news commentator advise
travelers to get to the air­
port earlier than normal. The
reporter warned of the inconve­
nience of long security lines if our
elected leaders do not reach agree­
ment about the federal budget.
At issue are the across the board
cuts in federal spending, known as
sequestration. This slippery slope
toward economic disaster did not
just begin yesterday and it won’t be
solved by short term, over-night
solutions that have becom e the
mode o f operation of late.
florilanb CObserUer
P u blisher :
E d it o r :
Established 1970
Mark Washington
M ich a el L eig h to n
E xecutive D irector :
Rakeem Washington
C reative D irector :
P aul N e u fe ld t
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able will suffer the deepest loss if
the sequester is enacted this w eek­
end. Let me give ju st a few ex­
am ples. Head Start will lose $406
million resulting in 70,000 children
being eliminated from the program.
Public housing support is sched­
uled to be reduced by $1.94 m il­
lion. The N ational Institutes of
H ealth will be cut by $1.6 billion
and global health program s by
$433 million.
Furthermore, an essential step in
these economic times is to create
jobs; however, the sequester will go
in the opposite direction sliding us
back toward a recession.
According to Stephen Fuller, an
economist at George Mason Uni­
versity, 2.14 million jobs will be lost,
both defense and non-defense fed­
USPS 959-680
eral workers. If we consider the
325,693 employees in the Defense
Department, the 420,529 non-de­
fense federal workers, and those
who will lose their jobs in the public
and private sector due to cuts to
state programs, it is more than an
inconvenience to them and their
families.
It is the same old story about our
elected leaders who are failing to
govern responsibly. Unfortunately,
it has become commonplace to hear
about the breakdown of negotia­
tions between Democrats and Re­
publicans; between the House of
Representatives and the Senate;
between the White House and Con­
gress.
The divisions are so deep that
accusations are slung around and
in the meantime we face an eco­
nomic crisis that will have the deep­
est impact on the marginalized; sadly,
not an unusual story.
We must get real. We must rec­
ognize that if people are out of work,
if parents do not have adequate day
care, if families are denied support
for housing and health care, they
will be cast into a tragic set of cir­
cumstances that may take years to
remedy.
We must raise our voices in pro­
test because caring for one another
in the wealthiest nation in the world
is the right and just thing to do. It is
not an inconvenience.
M. Linda Jaramillo is executive
minister fo r Justice and Witness
Ministries for the United Church o f
Christ.
47 4 7 NE Martin Luther King, Jr. Blvd., Portland, OR 97211
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