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This Is What Democracy Looks Like
www.NationalView.org's Note From a Madman
October 9, 2008
McCain's Promises
John
McCain stated at Tuesday night's presidential debate that there are going to be
changes for all of us looking at Social Security as our only means of retirement
in the coming years. The words he used might not have said exactly that, but the
meaning was clear as day.
"My friends, we are not going to be able to provide the same benefit for
present-day workers that we are going -- that present-day retirees have today,"
-McCain from the debate
Now that's not what a friend tells a friend, is it?
John McCain isn't looking at ways to fix Medicare, Medicaid and Social Security
- he is looking for ways to end those programs. To paraphrase Ronald Reagan from
his 1984 Presidential debate with Walter Mondale, you can bet that when a
politician says he's going to cut your Social Security benefits, you can bet
that he's going to do it.
Imagine
had McCain, President Bush and the rest of those on the Right who wanted to
"invest" our dollars in the market had gotten their wish. Where would our Social
Security trust find be today? Where would those who are retiring today or soon
be today?
The obvious fix to Social Security is easy: Raise or eliminate the cap which
today stands at about $100,000. it fixes the problem permanently. But McCain
can't do that because his real "base of haves and have mores" are in the group
which earns over that magic $100,000 mark.
Wouldn't it really be something to have McCain say those same words (above) on a
stage in Florida during a campaign speech?
-Noah Greenberg
McCain's Scheme
To recap: First John McCain said the "Fundamentals of the economy are sound";
then he suspended his campaign to spearhead the $700 billion bailout package
(although never really suspending anything other than a David Letterman
appearance); now he wants to help Americans who can't afford to pay their
mortgages by giving money, unrestricted, to those very same financial
institutions who screwed up the mortgage industry in the first place.
During Tuesday night's Presidential Debate, McCain offered up his new plan:
"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 -- be
able to make those payments and stay in their homes,"
-McCain from the Tuesday night debate
McCain's campaign, however, after hearing of this plan, now called the American
Homeownership Resurgence Plan to help homeowners make their monthly mortgage
payment offered up an explanation of what McCain meant:
"Lenders in these cases must recognize the loss that they've already suffered,"
-the McCain Campaign, via letter
In other words, no plan is better than a plan.
What bothers me most about McCain offering to purchase even more bad debt from
lending institutions is that, it appears, he was willing to part with more of
our money - an additional $300 billion more - to purchase these loans at face
value. So if Joe Bumstead purchased a house as a non-preferred borrower from Big
Bank "A" for a million dollars; and now that property is worth somewhere in the
$100,000 range, we, the US middle class tax payer as ,mortgage holder, would be
out of luck.
And if that home were to somehow increase in value the day after the homeowner
renegotiated his McCain-as-President-backed-US-Taxpayer-paid-for mortgage, that
homeowner would reap the benefits of being able to sell that home and pocket the
difference.
There's yet another scenario that boggles the mind here: Those with the money to
spare - a.k.a. the McBush "base of haves and have mores" - and, believe me,
there are still plenty of them left - can take some of their golden parachute
dollars, buy up the homes at a discount from those who just renegotiated their
loans, and make themselves a killing beginning the charade all over again.
While all of these shenanigans and schemes are going on, we, the middle-class
taxpayers, are going to be footing the bill. As a result, our dollar will be
worth less meaning that our money will purchase less of those same goods we need
to live on every day.
In other words, the US Middle-Class gets to subsidize big business and these
brand new huge financial institutions all over again.
Today on Andrea Mitchell’s MSNBC afternoon show, McCain spokesman Tucker Bounds
attempted to play off the McCain plan as beneficial to homeowners. Bounds said
that $300 of the $700 billion would go directly to homeowners. What Bounds
failed to mention, and wouldn’t allow Mitchell to interrupt to ask, was the fact
that McCain’s plan would purchase the mortgages, at face value, from the lender,
something the campaign’s letter, itself, refutes.
Bounds stated that there can be no other way because the mortgage lender has a
first right of refusal to the loan and they don’t have to turn it over to the
government for re-finance purposes. If elected, McCain has every intention of
paying top dollar - 2004-2006 dollars - for properties that are worth a fraction
of their value today. And that money will go directly to the lenders.
If is sounds familiar, it should: It's exactly what those on the Right are
trying to get away with in the "Mark-to-Market" scheme they're touting as a part
of our economic recovery. Mark-to-Market refers to the practice of allowing Big
Finance to keep their bad investments at the value of when they purchased it not
what it's worth today. According to those in the know, it will allow Big Finance
to borrow the dollars no one will lend them today. The problem is that they will
be borrowing money against collateral that simply isn't there.
And that's just what McCain wants to do with this proposal.
Lenders cannot have this cake and eat it, too. Laws are made for the benefit of
all, not for all who can afford it. It’s simple: If these lenders want our help
to purchase the mistake which they made and facilitated, they should lose that
right of first refusal. Certainly the give-and-take must come from all side:
Lender, borrower and the US taxpayer as the new mortgage holder.
There is a way to make a plan like this make sense and that is to make it all or
nothing. In a world of gray, we must give the lender the choice of obtaining our
help or refusing it entirely. If we allow them to pick and choose we will be
left with a substantial bill and they will only get richer and get ready for
their next scheme.
And it is a scheme.
Here’s how any plan has to work:
-Those mortgagee’s who are having trouble paying their mortgage would apply for
federal assistance
-Each would immediately have any actions taken by their lender frozen upon
review
-The lender would have an opportunity to have their case heard
The lender could then negotiate with a federal regulator who would then set the
new terms of the mortgage (new terms; fixed rate; etc) and would either accept
the new terms or sell the mortgage to the Federal government program at market
value, not what they purchased the loan for.
No schemes and no free rides. Everyone gets hurt, not just the US middle-class.
-Noah Greenberg
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-Noah Greenberg