w/Foreclosures at All-Time High, Can Obama, House, be Re-Elected?
They Blew it On Bankruptcy Protection for Homeowners, and Now They're Getting Rolled on All-Important Health Care.
Horrifying statistics have just been released by the Mortgage Bankers Association, which finds that:
About 13.16 percent of mortgage loans were delinquent or in the foreclosure process during the quarter, according to the group. That is the highest level ever recorded by the survey, which has been conducted since 1972, and breaks a record set last quarter.
The problem has continued to shift from the subprime loans that helped spark the foreclosure crisis to prime borrowers that are struggling under the impact of the declining economy, including rising unemployment, according to the Mortgage Bankers Association. Foreclosure rates are likely to continue to rise until late next year, said Jay Brinkmann, the group's chief economist.
"It is unlikely we will see meaningful reductions in the foreclosure and delinquency rates until the employment situation improves," he said.
About 13.16 percent of mortgage loans were delinquent or in the foreclosure process during the quarter, according to the group. That is the highest level ever recorded by the survey, which has been conducted since 1972, and breaks a record set last quarter. WaPost
The situation has gotten dramatically worse since John McCain and President Obama faced off in November of 2008. On September 5, 2008, CNN Money reported:
A record 1.2 million homes were in foreclosure during the second quarter of 2008.
That represents 2.8% of all outstanding loans, up from 1.4% of all loans during the same period a year ago, according to a report released Friday by the Mortgage Bankers Association (MBA).
And 490,000 of the 45 million home mortgages serviced by MBA members began new foreclosure proceedings. That's up 9% from the 448,000 starts recorded in the previous quarter, and marked the seventh straight quarter that foreclosure starts increased. Money.CNN.com
The middle class is in desperate straights. Almost one in every eight mortgages is in trouble now, compared to 2.8% (one in thirty six mortgages) in September of 2008 and 1.4% (one in 71) in 2007. There are many ways to measure the condition of the economy, but whether people's furniture is in their own homes or in rented storage bins is very realistic way to measure people's subjective experience of the economy. And that subjective experience, including the unemployment rates, seem to be getting progressively worse, not better.
President Obama was elected to take dramatic steps to help Americans out of this mess. Now, it’s clear that the dramatically expensive steps he took helped the bankers far more than they did individual homeowners (home losers) who will choose a new House of Representatives in 2010. Rory Cripps at NowPublic says the Government steps taken so far have been of limited value.
The problem has gotten remarkably worse and yet, when the Democrats had it within their power to empower bankruptcy judges to reformulate individual mortgages so that Americans could stay in their homes, the Democrats dropped that provision from their bank bailout plans, voting instead with the big banks that caused the crisis in the first place, and with the Republicans who sat by and let mortgage banking become a Katrina-like storm.
As the dramatically worse home foreclosures numbers are released, President Obama announces that his health care reform need not actually include reform. If Republicans and corporate interests really, really oppose health reform then Obama will settle for new wheelchair ramps at hospitals and clinics that don't treat the sick.
When the Democratic members of the US House of Representatives are up for re-election in fourteen months, many more Americans will have lost their homes, including many from the middle class, who never expected to find themselves in this situation.
Somebody will have to pay for this mess, and it’s likely to be the hot potato that the Republicans are content to leave firmly in the hands of the Democrats who, time and again, lacked the courage to do what needed to be done. In the House elections of 2010 and again in the presidential election of 2012, the public may decide to simply punish Democrats for failing to use the mandate they were given in 2006 and 2008 to bring real change. Republicans can smugly say that things have gotten worse under Obama and, for those who lose their homes or file for bankruptcy with medical bills at the top of the "can't pay it" list, that will undoubtedly be true.
Meanwhile, the IraqAfghaniPakistani war seems as likely to be an ungodly mess in 2010 as it is right now, with progressives and liberals demoralized by Obama’s failure to bring troops home instead of just moving them from one war to another.
If President Obama will let a few conservative Democrats and three Republicans turn his health care reform into a lollipop in the dentists’ office, then what would he do with a Republican majority if the Democrats lose significant seats in the House in 2010? Obama could morph into Bush-lite.
This situation reminds me of 1992/1994, when Clinton got rolled on so many issues by Republicans and conservative Demublicans (health care, gays in the military) that Americans decided to turn the Congress over to the Republicans, frustrating all of the grand plans with which Clinton had come to office. So, Clinton began cutting even more conservative deals with Republicans, triangulating to avoid being impaled.
President Obama promised us change with substance, perhaps naively believing that this could come through negotiations with Republicans instead of simply steamrolling them. It’s clear now that the Republicans aren’t going to adopt any of Obama’s ideas, regardless of how much he glad-hands them and offers them baked cookies, which may be the moment when Republicans decided they would easily pick Obama’s pockets.
Now we’re getting all negotiation and very little change from President Obama, frustrating even those who had the highest hopes for him. If Republicans turn out in 2010 and progressives and liberals are in too demoralized to care, then the Democratic Congress and the President will obviously be in very deep trouble, along with majority of the rest of America.