At a Domestic Policy Subcommittee of the House Oversight and Government Reform Committee hearing on the impact of the subprime mortgage crisis on neighborhoods, Maryland Councilmember Nancy Floreen says that foreclosed property “sends a message” to the rest of the community that they “don’t need to try,” and that if they’re “on the edge, why not do it to?”  She said it causes others in surrounding homes to wonder why they should improve the “quality of life within a community” by cleaning up graffiti, mowing lawns, repairing broken steps, and other maintenance issues. (0:50)

 

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At a Domestic Policy Subcommittee of the House Oversight and Government Reform Committee hearing on the impact of the subprime mortgage crisis on neighborhoods, Maryland Councilmember Nancy Floreen says that the market has “preyed upon people who cannot afford the situations in which they’ve been led.”  She also says that the crisis has disproportionately affected minority communities, and said that blacks in Maryland are three times more likely than whites to receive a subprime loan, and Latinos are twice as likely as whites. (0:36)

 

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The Domestic Policy Subcommittee of the House Oversight and Government Reform Committee held a hearing on “Neighborhoods: The Blameless Victims of the Subprime Mortgage Crisis” to discuss the more widespread repercussions of foreclosures and vacant properties within concentrated areas, as opposed to effects on individual families and the economy.
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The House Subcommittee on Housing and Community Opportunity of the Committee on Financial Services held a hearing to assess the implementation of Community Development Block Grant funds for post-Hurricane Katrina reconstruction among the states impacted along the Gulf Coast.
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At the Housing Crisis and Lessons for Monetary Policy discussion hosted by the Brookings Institution, Economic Counselor and Director of the International Monetary Fund Simon Johnson predicts a “minor contraction” for the U.S. economy this year, followed by a “slow recovery” next year. He also talks about the spillover effects of the U.S. housing market into other nations, and predicts a decline in global growth projection. (0:43)

 

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At a discussion on the Housing Crisis and Lessons for Monetary Policy at the Brookings Institute today, International Monetary Fund Economic Counselor and Director Simon Johnson predicted a “mild contraction” in the U.S. economy this year followed by a “relatively slow recovery” next year. Johnson discussed the link between housing and mortgage finance and said that the link between monetary policy and housing is stronger because of recent governmental intervention in the current crisis.

IMF Senior Economist Roberto Cardarelli said that over the last four quarters, residential investment has contributed 56% to the decline in U.S. GDP, “and by that standard, we are very much in a recession environment in the United States.” Cardarelli said another cause for concern is the impact of housing prices on the decline in consumption, which further stunts economic growth. He also emphasized that inflation rates need to change in order to stabilize inflation and minimize loss.

Congresswoman Maxine Waters (D-CA), chair of the House Subcommittee on Housing and Community Opportunity, discusses the problems concerning consumers stuck in the foreclosure crisis at a hearing on foreclosure prevention and sound mortgage servicing. (0:33)

 

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The House Committee on Financial Services Subcommittee on Housing and Community Opportunity held a hearing concerning foreclosure prevention and sound mortgage servicing.

The committee interrogated a panel of governmental housing program leaders including Laura Maggiano, Deputy Director of the Office of Single Family Asset Management at the Department of Housing and Urban Development (HUD). Maggiano defended HUD’s assistance to families unable to finance their homes amid strong criticism from each congressional representative at the hearing, particularly Chairwoman Maxine Waters (D-CA).

Rep. Emmanuel Cleaver (D-MO) told the panel that with our country experiencing “approximately 20,000 foreclosures a week” that we have“more than a casual problem”. (more…)

The Center on Budget and Policy Priorities held a conference call today to compare the House and Senate housing relief tax packages. Call participants voiced their concerns about the lack of success both chambers of Congress have had to date in helping families decimated by the crisis concerning housing foreclosures and subprime mortgage rates.

Call participants discussed how the packages Congress has implemented to address the growing rate of housing foreclosures facing Americans “don’t meet the needs” of families seeking government aid. The discussion also focused on the importance of providing struggling families with tax credit, something the Senate bill does not address. Policy analyst Aviva Aron-Dine discussed how there are too many provisions that the relief package bills include (particularly the Senate version) that do not have anything to do with the housing crisis. Call participants explained that tax cuts the bills include for the wealthy are of no assistance to the poor who do not benefit from them.

Aron-Dine described the Senate bill as “extremely disappointing” and noted that while the House version is better, it still does not go far enough toward helping families in dire need of governmental aid. Aron-Dine explained that 60% of the Senate bill has nothing to do with helping solve the foreclosure problem. Call hosts also interestingly noted that forclosures destroy community life as well as family life, and that people renting homes have been affected by the crisis as well.

Today Senator John McCain’s (R-AZ) campaign held a conference call to discuss his stance on economic policy, and the housing crisis and mortgage foreclosures in particular. RNC Victory 2008 Chair Carly Fiorina and Senior Policy Advisor Doug Holtz-Eakin outlined McCain’s policy proposals on how to combat the crisis.

 

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