The House of Representatives today passed a bill designed to help homeowners facing foreclosure after taking out subprime loans. The bill passed along partisan lines and could face a veto from President Bush. 

As the Washington Post’s Dina ElBoghady’s reports, such legislation could put an overwhelming burden on the largely unknown Federal Housing Administration. A part of Housing and Urban Development, FHA works with private lenders to give mortgage insurance to borrowers. By working with riskier borrowers, as the legislation requires, FHA may need resources it currently doesn’t have. The agency has been self-sustaining since it was created during the Great Depression. Read El Boghdady here.  MB

On Monday, the House oversight committee released a report showing that a Bush administration plan to slash Medicaid is a serious blow to hospital emergency rooms. Yesterday Dept. of Homeland Security Secretary Michael Chertoff and Dept. of Health and Human Services Secretary Michael Leavitt defended the cuts, which come to $17.6 billion over the next five years.

The Washington Post’s Spencer S. Hsu reports that Chertoff and Leavitt conceded to the oversight committee that there is a lack of beds and trained personnel for many urban hospitals to deal with a terrorist attack or natural disaster. Leavitt argued, though, that hospitals have to deal with a surge of patients by creating the equivalent of a hospital-wide emergency room.  In other words, Leavitt argued that it’s not about federal dollars but about how the state and individual hospitals use those resources.  It bears monitoring whether his words affect House legislation to put a moratorium on the Medicaid cuts.  Read Hsu here.  MB

The Washington Post’s Christopher Lee and Carrie Johnson lay out the unusual corruption case of Scott Bloch, director of the Office of Special Counsel. Tuesday, the FBI raided the special counsel’s office and now more than a dozen current and former agency employees have been asked to testify before a grand jury.

What Bloch is being investigated for is still not clear. Lee and Johnson do provide several instances of the watchdog agency’s investigations of political interference that may have just been covering up Bloch’s own inappropriate conduct. But the biggest charge is that Bloch hired a tech company to erase the special counsel’s computer hard drives—an allegation that’s been made since 2006. Perhaps the FBI has since uncovered enough evidence to end this Bloch party.  Read Lee and Johnson here.  MB

Can an agency be something worse than non-functional? Yesterday the Washington Post reported that President Bush nominated three commissioners to run a Federal Election Commission that’s supposed to have six commissioners, but now has two. One problem with the three nominees is that they must be considered as a package with Hans von Spakovsky, who as a Justice Dept. official created loathing among Democrats who said he suppressed minority voting rights.

But a New York Times editorial argues there’s a bigger problem with Bush’s package deal. It would also include canning David Mason, the current FEC Chairman who said that John McCain’s presidential campaign may be breaking commission rules. Not only can’t Bush drop von Spakovsky, he wants to get rid of the chairman who appears to actually want to perform the commission’s work. Read NYT here.  MB