Understanding Government

Four years after the housing bubble burst, all levels of government are getting their bearings in addressing the foreclosure crisis. A mix of programs are either being started or revived that might actually address specific payment problems homeowners face.

Illinois announced on Friday that it will use $100 million in federal money to start a Mortgage Resolution Fund, where a public-private partnership will buy “underwater mortgages” — those where delinquent payments are worth more than the mortgage itself — from homeowners in the Chicago area. (more…)

Sheila Bair

“[W]e were being ignored, and we had something to bring to the table,” Joe Nocera quotes the former head of the FDIC in the New York Times Magazine.  Bair was one of the few people at the top levels of government to push for more restrictions on investment banks and one of the very few to say that more banks should be allowed to fail.  It wasn’t just that the FDIC was a smaller agency than most, or that Bair was a Republican.  The reason Sheila Bair got no traction for her sensible views was often due, by all appearances, to the fact that she’s a woman. (more…)

Kate Linebaugh of the Wall Street Journal puts together a lot of evidence that the Michigan auto industry is revived. Auto makers have announced more plant expansions and new jobs in Michigan; GM, Chrysler and Ford are at 37 percent production capacity, compared with 30 percent a decade earlier. “In Sterling Heights, Mich.,” Linebaugh writes, “a Chrysler plant saved from closure last year is now churning out two midsize models with 2,300 workers.”

Incredibly, Linebaugh goes the entire piece without mentioning the $80 billion U.S. Treasury Dept. bailout that enabled this revival! The Journal did report three weeks earlier that taxpayers will ultimately be responsible for $14 billion of this $80 billion. But in return, the Obama administration claims that hundreds of thousands of jobs have been created.

Where are the women?

Nowhere to be seen in discussions on the nation’s financial future, reports Kate Ackley of Roll Call in an article about the lack of women on the White House-Congress budget negotiation panel.  15 women’s organizations have asked the White House to include women in negotiations on the national budget between the White House and Congress. (more…)

Does more money need to go to government agencies investigating fraud and malfeasance on Wall Street?  That’s the question Ben Protess looks at in the New York Times.  The Commodity Futures Trading Commission and the Securities and Exchange Commission are the bodies that were supposed to have stopped subprime machinations leading up to the recession, but didn’t.  Without staff or even computers that could help them keep up with the bad guys on Wall Street, both the SEC and the CFTC got new funding in early Obama administration budgets.  Now they’re facing the budget knife just like everyone else, and the claim is that they won’t be able to do their jobs.  My sense is that these people are thinking about their agency’s budget when they should be thinking of the country’s. (more…)