Early this year Senator Dodd thought he had the answer to the foreclosure crisis. Right after he returned from his miserable failure of a presidential campaign, Banking Chairman Dodd proposed the "Hope for Homeowners" plan.
http://dodd.senate.gov/index.php?q=node/4324
Senator Chris Dodd (D-CT), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, today announced his intention to introduce legislation that will create a new program within the Federal Housing Administration (FHA) to provide aid to distressed borrowers currently trapped in mortgages they cannot afford. Under the “HOPE for Homeowners Act of 2008," new mortgages that are offered by FHA-approved lenders will refinance abusive loans at a significant discount for homeowners facing difficulty meeting their mortgage payments
My problem at the time this was introduced was to promised to relieve imprudent lenders of much of the loss they should have eaten for bad lending decisions. Well, we've gotten way beyond that , having thrown a TARP over the whole blinkin banking sector. The new problem with Dodd's masterpiece----it isn;t helping homeowners.
Secretary of Housing and Urban Development Steve Preston said the centerpiece of the federal government's effort to help struggling homeowners has been a failure and he's blaming Congress....
The three-year program was supposed to help 400,000 borrowers avoid foreclosure. But it has attracted only 312 applications since its October launch because it is too expensive and onerous for lenders and borrowers alike, Preston said in an interview.
"What most people don't understand is that this program was designed to the detail by Congress," Preston said. "Congress dotted the i's and crossed the t's for us, and unfortunately it has made this program tough to use."
http://www.washingtonpost.com/wp-dyn/content/article/2008/12/16/AR2008121603177.html?hpid=topnews
Nice job Chairman Dodd. The Wall Street bankers all are keeping their multiple houses and your expensive rescue plan for ordinary folks over their head is dysfunctional.
Well, maybe the new HUD secretary will throw enough money at this problem to make it look like someone is getting helped. He went to the "right school" but I'm not sure a background in NYC is all that relevant http://www.latimes.com/business/la-na-hud-obama14-2008dec14,0,5865966.story . There's hardly any owner-occupied housing in the city, which suffers from a chronic housing shortage http://www.nysun.com/real-estate/shortage-of-housing-threatens-city-institutions/73748/ and the debiltating effect of decades of rent control. http://en.wikipedia.org/wiki/Rent_control_in_New_York. Not exactly the background to deal with plummeting single family home values, in my book.
But it's certainly better credentials than Dodd's credentials to fix the auto business, as he felt compelled to kibitz http://dodd.senate.gov/index.php?q=node/4685 after the President jumped in to clean up the mess Dodd made of the bailout bill http://thenextright.com/ironman/step-away-from-the-vehicle-senator-dodd Dodd is now upset about worker concessions; well, given the stock price of GM the investors already took their hit. http://finance.yahoo.com/echarts?s=GM#symbol=GM;range=1y Everyone who has looked at this knows the Corker plan is the only way to create a viable business model, but no doubt the Obama team will try and create "American Leyland" http://thenextright.com/ironman/can-hope-change-a-spark-plug to appease the Greens and UAW.
Just so you know Santa knows who is naughty and nice, the Q poll came out and Dodd did rather poorly for a long time Democratic incumbent in the era of Obama ascendancy in the Blue States . Artful Doddger did a rather thorough write -up on the impact of the Q Poll in his blog http://theartfuldoddger.blogspot.com/2008/12/new-poll-shows-dodds-vulnerability-in.html highlighting Dodd's vulnerability.
Let me add a couple of points here as to Dodd's winter of discontent.
a) He has an empty war chest at the moment and many of his old benefactors have entered a new chapter of their financial life. He may not be able to replenish at will like prior campaigns.
b) the "hard" opposition vote is larger than ever. Only 13% of CT voters will defintely re-elect Dodd, 27% will defintely vote to remove him. We've seen what happened when there's an intensity deficit for a candidate. Dodd has this in spades; and unlike the war driven 2006 election or the Obamania of 2008, it's hard to see Democratic turnout in CT being quite as high in 2010.
If anything drives 2010 turnout it will be anger over the economy. Bad time to be chairman of the Senate Banking Committee, eh?
Well, Chris, just remember your gift from Angelo Mozilo came early. Enjoy what you have.
