Obama to target CRA, social engineering in housing/lending market

posted at 10:55 am on July 21, 2010 by Ed Morrissey

Could it be possible that Barack Obama may dare to go where George Bush and some Republicans wouldn’t in limiting government interventions?  For most of a decade, the US government manipulated lending markets and pressured banks to get mortgages for lower-income families under both the Clinton and Bush administrations, and with Democratic and Republican Congresses.  Now, the Washington Post reports that the Obama administration wants to end the social engineering that created the housing bubble and subsequent collapse as its next target for reform:

Responding to the collapse in home prices and the huge number of foreclosures, the Obama administration is pursuing an overhaul of government policy that could diverge from the emphasis on homeownership embraced by former administrations.

“In previous eras, we haven’t seen people question whether homeownership was the right decision. It was just assumed that’s where you want to go,” said Raphael Bostic, a senior official in the Department of Housing and Urban Development. “You’re not going to hear us say that.”

Bostic, who has published leading scholarship on homeownership, added that owning a home has a lot of value, but “what we’ve seen in the last four years is that there really is an underside to homeownership.”

The administration’s narrower view of who should own a home and what the government should to do to support them could have major implications for the economy as well as borrowers. Broadly, the administration may wind down some government backing for home loans, but increase the focus on affordable rentals.

The shift in approach could mean higher down payments and interest rates on loans, more barriers to lower-income people buying houses, and fewer homeowners overall, government officials said. But it could also pave the way for a more stable housing market, one with fewer taxpayer dollars on the line and less of a risk that homeowners will not be able to pay their mortgages. And it could spell changes throughout the financial markets, as investors choose new places to put their money if the government withdraws some incentives for investing in the U.S. mortgage market.

There is an interesting axiom in American politics: Only Nixon could go to China.  It explains how it takes a leader willing to act against political interests to take a step that creates large benefits for the nation.  In this case, it would appear that only Obama could take on Barney Frank, Chris Dodd, and the redistributionist caucus of his party to put an end to the real cause of the financial collapse.

Will the White House go through with it?  It’s one thing to leak this to the Post.  It’s another thing entirely to follow through with the necessary rulemaking and legislative effort needed to succeed in it.  The Post notes that La Raza, one of the groups that gains material benefit from participating in government programs for these home-ownership efforts, is already unhappy with the idea.  At a time when Obama’s approval ratings are sinking towards Bush levels, this could alienate his ideological base and leave him utterly abandoned in 2012.

Let’s hope Obama commits to this reform.  If he does, it will easily be the most significant economic reform of his tenure, and would represent a significant retreat from the government interventions and social engineering that have ruined the American economy, and could set the stage for even further constraints on federal power.  That would show actual leadership and strength.


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Comment pages: 1 2

Will the White House go through with it? It’s one thing to leak this to the Post.

hmmm…they like to put up trial balloons…don’t think anything will come to fruition

cmsinaz on July 21, 2010 at 12:03 PM

Ed,

You are being too generous with Obama. He knows this proposal will go nowhere. He needs to give the appearance of changing course, not the substance. This all revolves around the elections and his approval ratings.

When did you ever see a congressman refuse to be on the stage with a sitting President of his own party? Yet it is happenning all over the country now. Congressmen are asking him not to appear at their rallys. They are becoming unavailable when he comes to the state for fundraisers.

He is toxic.

Corky Boyd on July 21, 2010 at 12:05 PM

I rate this along with Junior’s “commitment” to offshore drilling.

NATO. No Action, Talk Only.

He hasn’t the cojones to try something like this.

Harry Schell on July 21, 2010 at 12:05 PM

You really could not have missed the big picture here, could you?

What stands in the way of Communism or Socialism?

How about … “ownership?”

Citizens who own property are no longer dependent on government for survival. Tyrants do not want citizens to own property. They want you to be forced to rent, and whenever possible, from THEM.

What better way to discourage ownership than to give financial incentives to those who rent, while eliminating government backed loans for purchases? And of course, that financial incentive will come from your own paycheck via taxes.

Gregor on July 21, 2010 at 12:11 PM

Let’s hope Obama commits to this reform. If he does, it will easily be the most significant economic reform of his tenure, and would represent a significant retreat from the government interventions and social engineering that have ruined the American economy, and could set the stage for even further constraints on federal power. That would show actual leadership and strength.

Who are you and what have you done with Ed?

bloviator on July 21, 2010 at 12:14 PM

If this is real, its just sheep’s clothing. As I read your post I couldn’t quite believe that you think there’s hope of this reform happening under Barry.

BVM on July 21, 2010 at 12:16 PM

Call BAWNEY FWANK!!

Call CHWIS DODD!!

Wight NOW!!

Obambi gonna make the po’ peepo wiv in WENTALS!!

Oh, the terror! Oh the humanity!! Those diwty Weepublicans must have swipped something into Obambi’s Fwesca!!

novaculus on July 21, 2010 at 12:21 PM

I doubt this. He made a speech to the nation that he was going to increase off-shore drilling. This “leak” is just to try to help the Dems elections in November.

jeffn21 on July 21, 2010 at 12:21 PM

His pet race-victim Governor, Devil Patrick, was one of the most egregious of the State prosecutors of nannyism in the name of social engineering.

Good luck tossing that little twit under the bus.

Jaibones on July 21, 2010 at 12:27 PM

Does anybody else just think this is the first CYA step to removing the mortgage interest deduction in your taxes? Raise a ton of revenue while screwing existing mortgage holders at the same time, hmm?

dvldog1142 on July 21, 2010 at 12:29 PM

canopfor on July 21, 2010 at 11:19 AM

Ding. Ding. Ding. If Ed is this gullible, and actually falls for the notion that the Leftist-in-Chief would give up social-engineering, I hate to think how many Americans are going to fall for this scheme.

Tom Friedman is going to be mighty surprised when the Feds knock down his door and announce that a poor family of 12 has been assigned to his house.
How many times does PBHO have to kick someone in the face before they believe that he doesn’t have the best intentions for them?
Bishop on July 21, 2010 at 11:30 AM

The very rich have nothing to worry about, but I also guarantee that this will not be directed exclusively at “low income” areas. It’s middle class Americans whose neighborhoods are routinely destroyed by Section 8 welfare programs. It’s a great boon for investors who can pick up houses for a song, and receive guaranteed government payments (like winning the lottery!). These investors don’t care that they are purveyors of suburban blight because they don’t actually live in the neighborhoods they ‘invest’ in.

Buy Danish on July 21, 2010 at 12:30 PM

Do HotAir denizens still want to keep defending filthy, fascist TARP?

Increased housing commitments swelled U.S. taxpayers’ total support for the financial system by $700 billion in the past year to around $3.7 trillion, a government watchdog said on Wednesday. The Special Inspector General for the Troubled Asset Relief Program said the increase was due largely to the government’s pledges to supply capital to Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB) and to guarantee more mortgages to the support the housing market.

Rae on July 21, 2010 at 12:31 PM

As the housing bubble / crisis has proven, there is a definate risk in purchasing a home via a mortgage.

The Dems have been the party of preventing people from engaging in risky behavior for their own good. Whether it be eating transfats, burning carbon based fuels, letting fat kids eat twinkies for breakfast, deciding whether to carry health insurance (or how much or what kind) or even allowing folks to invest a small portion of their own social security funds in investments of their own choosing.

And yet, they also have gone out of their way to encourage the nation as a whole to accpet massive risk and encourage invidual people to engage in risky behavior (especially when it comes to purchasing homes they cannot afford, or have little hope of continuing to pay the mortgage payments for). They encourage people to leave their own countries and illegally come into ours. They scream racism and profiling at any attempt to adopt sensible national security policies at airports, borders and other ports of entry. And so on and so on . . .

So which is it Dems (and Obama)? Should government have “faith” in Americans to make their own decisions and live their own lives and determine the amount of risk they are willing to live with, OR should government (run by Dems and elites of course) be in the business of eliminating risk, controlling Americans, directing individual behavior and claiming that average Americans simply cannot be trusted to make decisions for themselves, thereby diplaying the ulitnmate lack of “faith” in Americans??

What am I thinking? They are liberals, they can have it BOTH ways regardless of whether that make sense or not.

Sheesh

Fatal on July 21, 2010 at 12:32 PM

This will never happen.

Especially after the two Democrats who got us into this mess, Dodd and Frank, were loudly applauded this morning for their roles in the “new” financial reform BS.

Trial balloon, nothing more.

Del Dolemonte on July 21, 2010 at 12:33 PM

It’s middle class Americans whose neighborhoods are routinely destroyed by Section 8 welfare programs. It’s a great boon for investors who can pick up houses for a song, and receive guaranteed government payments (like winning the lottery!). These investors don’t care that they are purveyors of suburban blight because they don’t actually live in the neighborhoods they ‘invest’ in.

Buy Danish on July 21, 2010 at 12:30 PM

The Dems hate the burbs, not only for environmental reasons (the freeways, the cars, the malls), but also because the burbs are hard-to-get voting blocs. Anything that could dilute the political clout of home-owner voters and substitute renters with government subsidies would further their goals.

If you can’t make gas so expensive that the suburbanites move back to the city (where their votes would be diluted, and the cities would get more taxpayers), then make the burbs more like the cities.

Wethal on July 21, 2010 at 12:35 PM

Ed, I have some ocean front property in Kanas that I would like to sell you. For Gods sake man, just what planet have you been living on for the last two year. This is nothing more than the usual slight of hand. The guy has promise the sun the moon and the stars but delivered nothing other than an all out effort to destroy our very form of government. I am actually shocked that you could possibly be naive enough to think for a second that this man and his cronies are going to do anything that doesn’t ultimately translate into a massive expansion of the role, scope and size of government. That’s all he has done his entire adult life. He knows no other way!!!

devere252 on July 21, 2010 at 12:38 PM

“All of Barack Obama’s statements come with expiration dates. All of them.”

Jim Geraghty, NRO

Wethal on July 21, 2010 at 12:46 PM

If Obama’s serious about this, we’ll see the White House continue to make it an issue even if the Republicans gain control (or especially if the Republicans gain control) of Congress in 2011.

If Obama’s going to try and use the Clinton-Morris ‘triangulation’ strategerie before the 2012 election to show he’s heard the voices of the swing voters and is changing his ways, he’s not going to convince them simply by saying he’s moderating — like Clinton with welfare reform, Obama’s actually going to have to sign something into law that goes against what he’s done the past two years to prove to the moderates (who still really don’t want to admit they threw their votes away in 2008) that he ‘gets it’ and has reformed.

This move sounds like a Rahm strategy, since he’s the one who recruited all those House members in 2006-08 to get elected by running to the right of their GOP opponents on several key issues. The question is does the Axelrod wing of the White House concur, or are they still so in love with the “Obama-As-Liberal-Messiah” meme that the plan will be sabotaged inside 1600 Pennsylvania Avenue before it even comes close to going to Congress.

jon1979 on July 21, 2010 at 1:00 PM

I must have just awakened from a long nightmare in the Twilight Zone to find out that John McCain is really President–didn’t he propose limiting the lending power of Fannie and Freddie to solvent borrowers back in 2005? Oh, wait a minute…

Republicans in Congress should seize upon this, and come up with some concrete proposals, such as banning Fannie and Freddie from making Adjustable Rate Mortgages (ARMs), requiring minimum down payments (such as 5%), and setting a maximum monthly payment / income ratio (30% would be reasonable) for government-backed fixed-rate loans from Fannie and Freddie.

This could be the bait for a coming switch, and Obama could never get this through the present Congress, so he’ll probably dump this proposal at a convenient time–what will the Fort Myers lady who wanted Obama to pay her mortgage say about the Gweat Communitay Awganizah?

But Obama might have let the cat out of the bag here. Republicans can seize on this issue, telling voters that their proposed reforms in 2005 (filibustered by Democrats) could have prevented the banking crisis in 2008, give us the majority, and we’ll pass it! The people who borrowed more than they could afford probably wouldn’t vote Republican anyway…

Home ownership is a GOOD thing, but to own something, you’ve got to pay for it. Why is that so hard to understand?

Steve Z on July 21, 2010 at 1:04 PM

Citizens who own property are no longer dependent on government for survival. Tyrants do not want citizens to own property. They want you to be forced to rent, and whenever possible, from THEM.

What better way to discourage ownership than to give financial incentives to those who rent, while eliminating government backed loans for purchases? And of course, that financial incentive will come from your own paycheck via taxes.

Gregor on July 21, 2010 at 12:11 PM

Bingo! The real goal of this “reform” is to create on a permanent class of renters and Section 8 takers. This means more people dependent on gov’t largess and expands the Dim base.

Also, property owners will be subject to stricter rent controls and higher taxes.

As bad as the CRA is, the least thing a homeowner wants is to have his or her neighborhood move from owners to renters.

Lou Budvis on July 21, 2010 at 1:06 PM

Translation….once those rich white people buy up all the homes we will raise property taxes to pay for “affordable rentals”. It’s just another form of redistribution.

milwife88 on July 21, 2010 at 11:05 AM

Excellent translation. Who’ll be defining “affordable rent”.

BowHuntingTexas on July 21, 2010 at 1:22 PM

Well, this is a good idea. If he follows through with it, I’ll be happy to congratulate Obama for making a good policy decision.

Jill1066 on July 21, 2010 at 1:28 PM

Come on… CRA da full force of da GubRmint

not so full force ….. Bankruptcy for whites

roflmao

donabernathy on July 21, 2010 at 1:32 PM

The administration’s narrower view of who should own a home and what the government should to do to support them could have major implications for the economy as well as borrowers.

yes, yes, do tell, who should own a home and who should. Hmmmmm….sounds like another commission or czar

we’ve come a long way baby….FDR has been a guiding light for 70 year

r keller on July 21, 2010 at 1:44 PM

Why bother on repairing THE MAJOR cause of the housing and economic collapse which the left expolited to gain political power in electing Barack Obowma AND this socialist agenda we have been shovelfed the last 18 months.

Nah, the Fed MUST sue Arizona for enforcing US immigration law which the fed is unwilling to enforce…..say what?

dthorny on July 21, 2010 at 1:44 PM

The administration’s narrower view of who should own a home and what the government should to do to support them could have major implications for the economy as well as borrowers.

yes, yes, do tell, who should own a home and who should. Hmmmmm….sounds like another commission or czar

we’ve come a long way baby….FDR has been a guiding light for 70 years

r keller on July 21, 2010 at 1:44 PM

Not buying it. Nope. For one thing, the putrescent carcass of the monster FrankandDodd still has the power to stop reform cold. In fact, the Bamster may be doing this because he knows it will go nowhere in Congress. Even in a Republican Congress, they will block financial reform until perhaps someday we have a supermajority not including RINOs.

slickwillie2001 on July 21, 2010 at 1:44 PM

Ed,

I think you’re mis-reading this. Sounds to me like he’s going to stop subsidizing home purchases for certain people and start subsidizing their rent. It’s still a government intervention and the devil will be in the details.

Heywood U. Reedmore on July 21, 2010 at 1:58 PM

I doubt this. He made a speech to the nation that he was going to increase off-shore drilling. This “leak” is just to try to help the Dems elections in November.

jeffn21 on July 21, 2010 at 12:21 PM

I’ve worked in the oil industry for 35 years. By allowing offshore oil well drilling does not equate with more oil production, it depends on WHERE drilling is allowed. Obowma allowed oil drilling further offshore in Virginia, an area heavily regulated by environmentalist groups-see BP well. Do you see lawsuits coming to stop drilling there? We’ve had oil seeping for over 75 years on the Santa Barbera, Calif coast, did Obowma allow oil drilling there? Alaska? SoCal?

dthorny on July 21, 2010 at 1:59 PM

Obama’s intent is pretty transparent–to make home ownership more difficult for the majority of people, so that gummint housing and the concentrated, easily manipulated dependent constituency it provides to big gummint incumbency can grow once again. Most people who had a decent chance to qualify for a home loan, though not a bunch of disposable income like political/corporate elites, won’t be able to do it anymore. However, certain groups targeted by gummint subsidies and special loan programs for “affirmative action” will get special treatment, as they do in every piece of legislation that passes DC’s sphincter under this administration. Don’t for one minute think that anything <0 does has any purpose but to bankrupt private, free enterprise, fundamental American values, and to impose his handlers' ideas of socialism and authoritarianism on us. It is wholly about power and not at all about what is good or right. Anyone who hopes <0 is successful in anything is deluded.

Ay Uaxe on July 21, 2010 at 2:01 PM

Mr President;

We KNOW who you are…

We KNOW what you stand for…

The jig is UP!!

Really you’re gonna do what???


Let’s hope Obama commits to this reform. If he does, it will easily be the most significant economic reform of his tenure, and would represent a significant retreat from the government interventions and social engineering that have ruined the American economy, and could set the stage for even further constraints on federal power. That would show actual leadership and strength.

Don’t make me laugh!

You, Mr President, and everyone like you will be gone from our sight.

America WILL stand against you, all for one and one for all…

We WILL become self sufficient…

We WILL drill…

We will be productive…

You and those like you CANNOT hold us back any more Mr President.

We will gather and protest until YOU and those like you will just become a bad memory, a nightmare we survived!!

YOu and those like you CANNOT stop us.

We are AMERICANS!!

Try and divide us, and we grow together…

We are UNITED as ONE against YOU and and all others like you and your policies of destruction.

We will not take it any more!!

Your time is short Mr President…work with us or be against us…those are your options…

You and those like you SERVE US!!

We DO NOT SERVE YOU!!

We are united, we are the people of these UNITED STATES!!

We are proud strong hard working and we will not submit to being ruled by YOUR govt.

YOU WILL HEAR US Mr President.

RoxanneH on July 21, 2010 at 2:10 PM

I’m with the skeptics here. I see his proposed plan as falling in along these lines:

The home mortgage tax deduction will be phased out, with the resultant ‘savings’ used to vastly increase Section 8 funding.

The huge backlog of foreclosed homes will be acquired by the govmint and rehabilitated by union scale workers to prepare them as subsidized rentals. A permanent govmint maintenance workforce (union of course) will keep up these places at vastly overcharged prices.

Rental price controls will be imposed.

All of this is consistent with previous social engineering ideas pushed by the progressives.

GnuBreed on July 21, 2010 at 2:19 PM

*ooomph – ooomph – ooomph*

That’s the sound of me, holding my breath.

franksalterego on July 21, 2010 at 2:48 PM

Let’s hope Obama commits to this reform.

Hope and change, baby. Hope and change.

The real hope lies in November. If conservatives can take control of Congress, maybe such necessary reforms could become reality. It is impossible with Nancy and Harry in charge.

MississippiMom on July 21, 2010 at 2:50 PM

You and those like you SERVE US!!

We DO NOT SERVE YOU!!
RoxanneH on July 21, 2010 at 2:10 PM

You racist you.

Just kidding.

I agree with you 100%. Here’s to hoping that a majority of Americans agree with you too.

MississippiMom on July 21, 2010 at 2:53 PM

So instead of Obama paying people’s mortgages he will pay their rent. Only people that lose are eeeeeevil bankers who will no longer get money from Obama via paid for mortgages. The people who win – and win BIG – are ACORN type groups who will run the “affordable rent” programs and take a healthy 15-20% off the top of every rent check.

angryed on July 21, 2010 at 2:55 PM

This probably WILL pi** off Mr. Dodd ! LOL
… “In a bid to stem taxpayer losses for bad loans guaranteed by federal housing agencies Fanny Mae and Freddy Mac, Senator Bob Corker (R-Tenn) proposed that borrowers be required to make a 5% down payment in order to qualify. His proposal was rejected 57-42 on a party-line vote because, as Senator Chris Dodd (D-Conn) explained, ‘passage of such a requirement would restrict home ownership to only those who can afford it.’ ”

http://tinyurl.com/2gxuxxk
(just the first link I found with that quote)

This is all just symbolism… phhht ! arrgh

pambi on July 21, 2010 at 3:14 PM

Anyone find this coincidental with the new Quinnipac Poll?

xler8bmw on July 21, 2010 at 3:16 PM

So its ok to distort the rental market with government ‘help’? And decide who is worthy of getting such ‘help’?

Have we learned NOTHING from Fannie, Freddie, Ginnie and Sallie and the distortions of the market with government ‘help’?

Sorry, but cutting back on distorting the home lending market is not going to ‘help’ and entering into the rental market will then cause problems there. Get this government out of ANYTHING to do with real property as that is the concern of the States and the people, not the federal government.

ajacksonian on July 21, 2010 at 3:52 PM

I did not really see this reported anywhere, but when Scott Brown agreed to vote for the financial overhaul, he said he did so only with promises from the administration that it would be followed up with a reform of the social engineering/high risk government created morgatge problem

Resolute on July 21, 2010 at 4:02 PM

Who needs the CRA when the feds want to move everyone into government apartment blocks?

Vashta.Nerada on July 21, 2010 at 4:07 PM

This would go against every fiber of Obowma’s being…

If something is passed, look for a 10,000 page bill, that no one will read, but will basically turn the United States into Venezuela.

Seven Percent Solution on July 21, 2010 at 4:09 PM

The Post notes that La Raza, one of the groups that gains material benefit from participating in government programs for these home-ownership efforts, is already unhappy with the idea.

And I bet that had nothing at all to do with the 5 million HUD mortgage loans to illegal aliens, right La Raza?

AZCoyote on July 21, 2010 at 4:15 PM

It would certainly go along way towards improving my opinion of him…political ploy or not.

jeanie on July 21, 2010 at 5:33 PM

I would suggest you look much deeper Ed, this is not IMO what you think it is.

The NEW focus is on Section 8 rental housing, in HOAs no less. Yes they are turning away from homeownership and instead the government is embedding itself into the rental and sales markets even further. This is from APRIL and no reporting on it. FINREG ignores it. It is not even on our balance sheet! and Obama is out there saying no more taxpayer bailouts? are you frakking kidding me?

The homeowner-turned-renter is required to pay fair market rent to stay in their home for up to 12 months. The renter must have enough income to sustain a 31% income-to-rent ratio and rental payments are not subsidized by Fannie Mae, but could include renters eligible for Section 8 payments.

The example the FANNIE Director gave is an HOA community here in Phoenix:

As an example, Gutierrez outlined the situation for a fictional family that purchased a $275,000 home in Phoenix with a $247,500 mortgage and a down payment. Including homeowner association (HOA) fees, their monthly payment was $2,050. While those payments were manageable five years ago, the sample borrower had reduced income from his job and HOA fees had increased. Unable to pay their mortgage, the borrower joined the D4L program, reducing their rent to $1,000 while the family continues to look for additional income and/or alternative housing.

The upside of the program for Fannie Mae, Gutierrez said, is promoting neighborhood stabilization, mitigating real estate owned (REO) costs and provides the opportunity to consider other REO strategies, such as maintaining longer rental terms.

“With these benefits to Fannie Mae and borrower, we find the deed for lease program is an effective solution for these properties,” Gutierrez said.

There are some requirements for the new renters’ eligibility. Property managers inspect the home to ensure it is well maintained, generally an indication the renter will continue to keep the property in good repair during the lease term. The house must be eligible for lease; many times HOA rules don’t allow a home to be rental properties.

The program marks a significant shift in the strategy for the government-sponsored enterprise. Whereas Fannie Mae would previously dispose of properties in a traditional REO sale, now Fannie is becoming a landlord. Gutierrez said that’s a position Fannie is prepared to be in for the near future.

“We’re building a rental portfolio and the strategies are going to differ depending on the market. In some markets we’ll take a long view and want to hold onto the rental properties for some time,” he said. “In other markets, we may decide to reduce in our inventory. But in some cases, it’s possible some of these tenants will be able to stay in these homes for a few years.”…

the FDIC is now a coinvestor in condos, no shxt, and Fannie is renting foreclosed homes in gated communities to Section 8 recipients. Obama gonna pay their mortgages Ed. Last month FAN FRED FHA made up 97% of the mortgage market. The plan is to convert all the supply to rentals for low income. it is redistribution. again.

The HEMAP program
seems okay comparatively speaking, it allows for a ‘bridge’ for unemployed homeowners to stay for a bit, but the FAN rentals in HOAs are IMO a breach of contract to all the other residents of the HOA.

ginaswo on July 21, 2010 at 8:40 PM

I’m skeptical, but the lawsuit against Arizona and the push for immigration reform should keep radical Marxist Latinos at least semi-quiet while does the housing reform. However, I’m still skeptical he’ll go through with it.

jonezee on July 21, 2010 at 9:06 PM

Fannie is renting foreclosed homes in gated communities to Section 8 recipients..
ginaswo on July 21, 2010 at 8:40 PM

Exactly right. Thanks for all the data…

Buy Danish on July 21, 2010 at 9:13 PM

BAAHAHAHAHAHAHAHAHAHAaaaaaaaaaa….

Barack Hussein Obama II “to target CRA, social engineering in housing/lending market.” It ain’t gonna happen folks, because that’s Progressive/Marxist heresy.

byteshredder on July 22, 2010 at 12:07 AM

#1 — this is a head fake.

#2 — even if it isn’t, it still counts as peanuts against the gynormous increase in social engineering Obama has done elsewhere.

#3 — this is still social engineering, even if he does change the set-point, he still believes that gov’t should be the entity setting the point.

Myno on July 22, 2010 at 5:12 AM

Let’s hope Obama commits to this reform. If he does, it will easily be the most significant economic reform of his tenure, and would represent a significant retreat from the government interventions and social engineering that have ruined the American economy, and could set the stage for even further constraints on federal power.

I’ll have what Ed is drinking.

I see the mortgage money moving to “green” high-density housing in urban areas. They won’t look like the Russian apartment buildings in Moscow, but they essentially serve the same purpose. complete with a Babuska (government minder) sitting at the front door.

WWCathodeRay on July 22, 2010 at 9:39 AM

This, to me, looks like a back-door route to essentially “getting rid of” the mortgage interest tax deduction. See, I think they’ll eventually say “Hey, unless you make under a certain amount of money, you can still deduct your mortgage insurance, but at a reduced percentage”. This will drive folks away from the benefits of owning their own home, and will result in fewer people writing off mortgage interest.

Most folks will seek out apartments, townhome rentals and (ugh) homeowner association communities, for their living arrangements.

In essence: Communes.
Carefully planned, carefully watched, carefully crafted,…Communes.

That’s not the angle Ed goes with in this piece, as far as I can tell, but, it’s what I easily see coming down the road, knowing what this administration has done already, and will continue to do.

Talismen on July 22, 2010 at 11:38 AM

Let us not forget that CRA is now pretty much codified in the Frank-n-Dodd Finreg bill. So its really no big loss to cancel the CRA.

This is just another political move.

JeffVader on July 22, 2010 at 1:03 PM

He will never in a million years do this.

Look at what he does, not what he says. All the major legislation passed by Dems during his adminstriation is festooned with race preferences and carveouts. This is just cheap and desperate talk as his party circles the drain in an election year.

I like to hope people like Ed will call this sort of BS for what it is, but no luck yet.

Missy on July 22, 2010 at 1:57 PM

Not enough of that loot going to Chicago, therefore CRA gets HopeNchange.

Dwee-dwee-dwuh-dwuh. DWUHHHH!!!

Feedie on July 22, 2010 at 2:31 PM

Well, well, well. According to Cavuto, Some W.H. ‘economist’ (didn’t catch his name – but it’s not Austen Goolsby) wants to end the mortgage interest deduction and property tax deductions because… it’s time to “give back”. The timing is purely a coincidence, I’m sure.

Buy Danish on July 22, 2010 at 6:01 PM

I smell a rat.

PattyJ on July 22, 2010 at 8:05 PM

Let’s hope Obama commits to this reform. If he does, it will easily be the most significant economic reform of his tenure, and would represent a significant retreat from the government interventions and social engineering that have ruined the American economy, and could set the stage for even further constraints on federal power. That would show actual leadership and strength.

I agree we should hope he commits to this. But lets not have any illusion that this comes from a genuine understanding that the government shouldn’t interfere with peoples’ lives. In fact, as misguided as Bush was in continuing the push for home ownership, it was at least predicated on the idea of an “ownership society” where private property is encouraged. A better and more sustainable approach to that, of course, would involve property tax reform, which I guess may be more of a state issue (not owning any property, I couldn’t say for sure).

Even though Obama is making the right call here, it’s likely motivated, in at least a small part, though maybe subconsciously, by a slight disdain for private property.

So, 2 cheers for the One.

RINO in Name Only on July 23, 2010 at 5:24 AM

If the Washington Post are adamant that Dems are starting to rethink social engineering. I would take that with a grain of salt and watch my six very closely, because they are about to ram something else down our throats.

MSGTAS on July 23, 2010 at 10:51 AM

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