Bank of America said 10/8 "that it was extending its suspension of foreclosures to all 50 states." The plan "swept states with some of the highest foreclosure levels" -- including CA, NV and AZ -- "into a swelling crisis over lenders' flawed paperwork that had been mostly confined to 23 other states that require judicial review of foreclosures."
"The bank's decision" 10/8 "increased pressure on other lenders to extend their moratoriums nationwide as well. An immediate effect of the action will be a temporary stay of execution for hundreds of thousands of borrowers in default." The bank said it would be a "mere pause while it makes sure its methods were in order. But as the furor grows over lenders' attempts to bypass legal rules in their haste to reclaim houses from delinquent owners, there is a growing expectation that foreclosures will dwindle for months as the foreclosure system is reworked."
"As soon as" BofA "announced its freeze," Senate Maj. Leader Harry Reid and Rep. Edolphus Towns (D-NY) "both pointedly asked other lenders to follow suit. Increased pressure also came from" Sen. Chris Dodd (D-CT). "The other lenders, however, did not seem swayed." Officials from JPMorgan Chase "have no plans to halt foreclosures nationwide, and believe they can fix the problems within weeks." And "Chase officials acknowledge they had a flawed process, but they say they have not mistakenly foreclosed on any homeowners." Both Wells Fargo and Citigroup have not suspended foreclosures (Streitfeld/Schwartz, New York Times, 10/8).
"Senior" Obama admin. officials said 10/8 "that a nationwide moratorium on foreclosure sales may be inevitable, despite their grave reservations about the impact a broad freeze would have on the nation's housing market and economic recovery." Also 10/8, thh FHA "said it had asked agency-approved mortgage services" to "immediately audit their foreclosure operations."
"In addition to a" nat'l "moratorium, some lawmakers are discussing reviving a bill that would give bankruptcy judges the power to modify loans and reduce principal to market value" (Cha/Mufson/Lynn Yang, Washington Post, 10/9).
Wall Street Journal editorializes, "A consumer borrows money to buy a house, doesn't make the mortgage payments, and then loses the house in a foreclosure -- only to learn that the wrong guy at the bank signed the foreclosure paperwork. Can you imagine? The affidavit was supposed to be signed by the nameless, faceless employee in the back office who reviewed the file, not the other nameless, faceless employee who sits at the front. The result is the same, but politicians understand the pain that results when the anonymous paper pusher who kicks you out of your home is not the anonymous paper pusher who is supposed to kick you out of your home."
"If evidence emerges of politics or actions that wrongly threw people out of their homes, by all means investigate and prosecute violations of law. But allowing people to live in homes without paying for them is not cost-free. ... The bigger damage here is to the housing market." The "moratoriums further politicize the housing market and further delay a housing recovery" (10/9).
WH senior adviser David Axelrod "signaled" 10/10 that the Obama admin. "is opposed" to a nat'l moratorium on foreclosures. Axelrod, on "Face the Nation": "I'm not sure about a national moratorium, because there are, in fact, valid foreclosures that probably should go forward, and where the documentation and paperwork is proper" (Cha, Washington Post, 10/10).
Keeping Up With The Congress
The Nov. 2 "elections could have an immediate impact on the makeup of the Senate and influence the lame-duck session." Winners of special SEN elections will be sworn in "as soon as the first day of the session," meaning "there will be new faces and a potential shift in the balance of power" (Hulse, "The Caucus," New York Times, 10/10).
Reid's top energy-policy adviser Chris Miller "nearly doubled his" $3.5K "stock investment in a renewable-energy firm" in '08. Reid spokesperson Jim Manley: "Mr. Miller showed poor judgment and Senator Reid has made it very clear to Chris and all his staff that their actions must not only follow the law, but must meet the higher standards the public has a right to expect from elected officials and their staffs."
Miller "isn't the only Congressional staffer making such stock bets. At least 72 aides on both sides of the aisle trader shares of companies that their bosses help oversee." The aides "say they didn't profit by making trades based on any information gathered in the hall os Congress. Even if they had done so, it would be legal, because insider-trading laws don't apply to Congress," (Mullins/McGinty/Zweig, Wall Street Journal, 10/11).
Different States, Different Votes
"Population growth and shifts of residents between states will impact the way electoral votes are reapportioned in advance of the" '12 elections, "and it appears more votes are moving toward states" that Pres. Obama "lost and away from the ones he won the first time around" (Haberman/Toeplitz, Politico, 10/9).
"Candidates from both political parties have suddenly found a new villain to run against: China." Dems and GOPers "are blaming one another for allowing the export of jobs to its economic rival."
"In the past week or so, at least 29 candidates have unveiled" ads "suggesting that their opponents have been too sympathetic to China, and as a result, Americans have suffered." One ad for Rep. Zack Space (D-OH) "accuses his" GOP opponent state Sen. Bob Gibbs "of supporting free-trade policies that sent Ohioans' jobs to China. As a giant dragon appears on the screen, the narrator sarcastically thanks" the GOPer: "As they say in China, xie xie Mr. Gibbs!" (Chen, New York Times, 10/9).
The Penny Press Makes A Comeback
"The increasing polarization of cable news is transforming, and in some ways shrinking, the electoral landscape. What has emerged is a form of narrowcasting, allowing candidates a welcoming platform that helps them avoid hostile press questioning and, in some cases, minimize the slog and slip-ups of retail campaigning." Syracuse Univ. Bleir Center for Television and Popular Culture dir. Robert Thompson: "There's no question it's contributing to the splintering of the political system and the means by which people get information about that system. If there's no standard base line of fact and reporting, where can the conversation go?"
"The reality, said" MSNBC pres. Phil Griffin, "is that 'politicians want to hit their base'" (Kurtz/Tumulty, Washington Post, 10/11).
War 101: Politicians Get An F
Bloomberg's Hunt writes, In SEN and House races, "the candidates are largely silent about the war, irrespective of the contest, region or party. This absence from the agenda reflects the dominance of the economic concerns facing many Americans. It's also a matter of political convenience:" Dems "with reservations about the war don't" want "to criticize an already beleaguered president, and" GOPers "want to appear muscular and tough without providing any plan or specifics."
Leaders "of both parties say it's all about the economy; Afghanistan is an afterthought." NRCC chair Pete Sessions (R-TX): "It's not a big campaign issue; it's a difficult time to talk about the war." The "press bears some responsibility; in most candidate debates, Afghanistan is a non-issue."
"It is reasonable to expect these candidates to discuss and debate how long we're willing to put our troops in harm's way, at what cost in treasure and with what consequences." In '10, "while brave young American men and women put their lives on the line," "the politicians at home are flunking this test" (10/10).