Archive for Housing

CNN Fact Check: Would McCain’s mortgage plan shift burden to taxpayers?

Posted in Accountability, Read for Yourself with tags , , , , , , on October 10, 2008 by doubletalkexpress

From CNN 10/10/08

The Statement:

An ad released Thursday, October 9, by Sen. Barack Obama’s campaign, titled “Tested,” takes aim at Sen. John McCain’s mortgage plan. “McCain would shift the burden from lenders to taxpayers, guaranteeing a loss of taxpayer money,” the ad’s narrator says. “Who wins? The same lenders that caused the crisis in the first place.”

Get the facts!

 

The Facts:
The ad refers to a plan McCain announced during a debate Tuesday night in Nashville, Tennessee. “I would order the secretary of the Treasury to immediately buy up the bad home loan mortgages in America and renegotiate at the new value of those homes — at the diminished value of those homes — and let people be able to … make those payments and stay in their homes,” McCain said.

On his Web site, McCain calls it “an American Homeownership Resurgence Plan.” Under his plan, the government would buy up some troubled mortgages at their full value — meaning the lenders would not take a loss. The government would then renegotiate those mortgages, so that eligible homeowners would be paying rates based on their homes’ current, reduced value.

McCain previously supported renegotiating mortgages with lenders, who would take losses. His economic adviser, Douglas Holtz-Eakin, told reporters Wednesday that McCain now believes having the government pay the entire value of the loans is “the only way” to begin stabilizing the housing market “in a timely fashion.”

Obama, in his ad, highlights this quote from a CNNMoney.com story: “Much of the burden of paying to keep troubled borrowers in their homes will shift to taxpayers.” The McCain campaign acknowledged that point, both on a conference call with Holtz-Eakin on the day after the debate and in a follow-up interview with CNN’s Les Christie, writer of the CNNMoney.com story.

The McCain campaign says the plan would cost about $300 billion. “Funds provided by Congress in (the) recent financial market stabilization bill can be used for this purpose; indeed by stabilizing mortgages it will likely be possible to avoid some purposes previously assumed needed in that bill,” the campaign Web site says.

McCain’s plan puts him at odds with a bill adopted by Congress in July that required lenders to write down mortgage balances to 90 percent of a home’s current market value in order to qualify for refinancing insured by the Federal Housing Administration. Neither McCain nor Obama voted on that bill.

While the Obama ad refers to “lenders that caused the crisis in the first place,” Obama himself has been using slightly different language on the stump, referring to lenders who “helped create this mess in the first place.” But the substance of Obama’s attack has not changed.

The Verdict:
True. The McCain campaign acknowledges the plan would shift the burden to taxpayers.

Who’s Behind John McCains Economic Policy?

Posted in Accountability, Read for Yourself with tags , , , on July 17, 2008 by doubletalkexpress

From: ProgressiveAccountability.org

McCain’s Approach To Housing Crisis Shaped By Adviser Gramm

American Banker: Bankers Looking To Gramm For Clues On McCain’s Policy. American Banker reported, “The financial services platform of Republican presidential candidate John McCain is largely a mystery, but bankers are looking to a familiar face in his entourage for some hints: former Senate Banking Committee Chairman Phil Gramm. As the Arizona senator trumpets other issues on the campaign trail, such as Iraq and government spending, his financial policies have been left to an extensive team of economists that includes Mr. Gramm, who also co-chairs his campaign. The Texas Republican’s involvement in the campaign – and potential choice as Treasury secretary – is seen as a critical clue as to how Sen. McCain would handle the housing crisis … Wayne Abernathy, a former aide to Mr. Gramm on the Banking Committee and now the American Bankers Association’s executive director of regulatory affairs, said the two senators’ philosophical alignment, as well as Sen. McCain’s policies while chairing the Commerce Committee, reflect a preference for market rather than government solutions.” [American Banker, 3/11/08, emphasis added]

  • American Banker: Gramm’s Role In McCain Campaign “Should Give Comfort To Bankers.” American Banker reported, “Mr. Gramm, a principal author of the 1999 Gramm-Leach-Bliley Act, which broke down the walls between banking, insurance, and securities, left Congress in late 2002 to become vice chairman of UBS Warburg. … Observers say that Mr. Gramm’s connection with the campaign should give comfort to bankers unsure of how Sen. McCain would view financial services issues.” [American Banker, 3/11/08, emphasis added]

McCain Donations From The Mortgage Industry

McCain Has Taken Over $2.1 Million From The Banking And Mortgage Industry. McCain has taken $2,120,794 in campaign contributions from the banking and mortgage lending industry, according to a Campaign Money Watch analysis of data obtained from the nonpartisan Center for Responsive Politics. This total reflects donations of $200 and above from individuals and PACs received by his campaign committees and leadership PAC through May 31, 2008. [Center for Responsive Politics via Campaign Money Watch]

  • McCain Has Taken $1.57 Million From The Banking And Mortgage Industry In 2008 Election Cycle Alone. McCain has taken $1.57 million in campaign contributions from the banking and mortgage lending industry in the 2008 election cycle alone, nearly three times what he received from 1989 to 2006, according to a Campaign Money Watch analysis of data obtained from the nonpartisan Center for Responsive Politics. [Center for Responsive Politics via Campaign Money Watch]

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