FacebookTwitterGoogle+RedditEmail

Sucker Punched By Speculation

by ALAN FARAGO

This terrible idea will not die: that the only way to revive the US economy is to reduce mortgages on homes and property purchased at speculative values. The fact that so many homeowners (like me) did not buy more house than they could afford, did not buy into the speculation economy, did not use homes as ATM’s, continue to pay monthly mortgages, honored their contracts and provided an example of fiscal responsibility to their families: these facts do not add up to a hill of beans according to sober commentators including former president Bill Clinton.

Clinton, especially. It was his administration (thank you, Robert Rubin) that endorsed changes to banking laws that turned the speculators loose (thank you, Phil Gramm). And it was Bush, afterwards, who paved the way for “the ownership society” (thank you Mel Martinez and Jeb Bush) and the wholesale surrender of the Federal Reserve to the gamblers and thieves. All remain more or less in situ: that is another matter.

So here is a deal that might be acceptable to fools like me, who find the idea of mortgage principal reduction at the bottom of a vomit bag. Pay me off.

Do mortgage principal reduction (MPR) in a way that rewards the ethical behavior implicit in renters who decided not to buy and homeowners who do not need reduction. This would work through cash rewards based on residential zip codes, GIS mapping, and proof of residence. (Now that I’m day-dreaming: turn Homeland Security guards at airports into office actuaries to handle the billions in claims.)

In each zip code, establish a grid comprising “speculative market value” and new “present fair value” for homes based on square footage, bedrooms, bathrooms, etc. Based on the difference between the two (SMV-PFV x months in residence or ownership), establish a baseline monthly payment. From that baseline, the federal government (ie. taxpayers) would reduce mortgage principal for the underwater homeowners and make a one time payment to all renters and all other homeowners who can prove residence and do not claim a mortgage principal reduction. In my imagination, for our honesty we would also receive a bonus tacked on. Say, a fifty percent add-on to the monthly payment for common sense and frugality.

The only thing I am serious about, here, is that the conversation about mortgage principal reduction must include benefits for those who played by the rules. My preference would be for this dialogue to take place in a public square with the bankers and speculators in stockades.

Millions of Americans are paying a severe price for having been suckered punched by a culture of speculation. Many wage-earners, too, are like victims of drive-by shootings. Many couldn’t speculate on housing but would have, if they could. Many wouldn’t, because they were cautious about predators. Isn’t it their turn for a free ride, too?

Alan Farago is conservation chair of Friends of the Everglades. He can be reached at: afarago@bellsouth.net

Alan Farago is president of Friends of the Everglades and can be reached at afarago@bellsouth.net

More articles by:

CounterPunch Magazine

minimag-edit

August 29, 2016
Eric Draitser
Hillary and the Clinton Foundation: Exemplars of America’s Political Rot
Patrick Timmons
Dildos on Campus, Gun in the Library: the New York Times and the Texas Gun War
Jack Rasmus
Bernie Sanders ‘OR’ Revolution: a Statement or a Question?
Richard Moser
Strategic Choreography and Inside/Outside Organizers
Nigel Clarke
President Obama’s “Now Watch This Drive” Moment
Robert Fisk
Iraq’s Willing Executioners
Wahid Azal
The Banality of Evil and the Ivory Tower Masterminds of the 1953 Coup d’Etat in Iran
Farzana Versey
Romancing the Activist
Frances Madeson
Meet the Geronimos: Apache Leader’s Descendants Talk About Living With the Legacy
Nauman Sadiq
The War on Terror and the Carter Doctrine
Lawrence Wittner
Does the Democratic Party Have a Progressive Platform–and Does It Matter?
Marjorie Cohn
Death to the Death Penalty in California
Winslow Myers
Asking the Right Questions
Rivera Sun
The Sane Candidate: Which Representatives Will End the Endless Wars?
Linn Washington Jr.
Philadelphia District Attorney Hammered for Hypocrisy
Binoy Kampmark
Banning Burkinis: the Politics of Beachwear
Weekend Edition
August 26, 2016
Friday - Sunday
Louisa Willcox
The Unbearable Killing of Yellowstone’s Grizzlies: 2015 Shatters Records for Bear Deaths
Paul Buhle
In the Shadow of the CIA: Liberalism’s Big Embarrassing Moment
Rob Urie
Crisis and Opportunity
Charles Pierson
Wedding Crashers Who Kill
Richard Moser
What is the Inside/Outside Strategy?
Dirk Bezemer – Michael Hudson
Finance is Not the Economy
Jeffrey St. Clair
Roaming Charges: Bernie’s Used Cars
Margaret Kimberley
Hillary and Colin: the War Criminal Charade
Patrick Cockburn
Turkey’s Foray into Syria: a Gamble in a Very Dangerous Game
Ishmael Reed
Birther Tries to Flim Flam Blacks  
Brian Terrell
What Makes a Hate Group?
Andrew Levine
How Donald Trump Can Still be a Hero: Force the Guardians of the Duopoly to Open Up the Debates
Howard Lisnoff
Trouble in Political Paradise
Terry Tempest Williams
Will Our National Parks Survive the Next 100 Years?
Ben Debney
The Swimsuit that Overthrew the State
Ashley Smith
Anti-imperialism and the Syrian Revolution
Andrew Stewart
Did Gore Throw the 2000 Election?
Vincent Navarro
Is the Nation State and Its Welfare State Dead? a Critique of Varoufakis
John Wight
Syria’s Kurds and the Wages of Treachery
Lawrence Davidson
The New Anti-Semitism: the Case of Joy Karega
Mateo Pimentel
The Affordable Care Act: A Litmus Test for American Capitalism?
Roger Annis
In Northern Syria, Turkey Opens New Front in its War Against the Kurds
David Swanson
ABC Shifts Blame from US Wars to Doctors Without Borders
Norman Pollack
American Exceptionalism: A Pernicious Doctrine
Ralph Nader
Readers Think, Thinkers Read
Julia Morris
The Mythologies of the Nauruan Refugee Nation
George Wuerthner
Caving to Ranchers: the Misguided Decision to Kill the Profanity Wolf Pack
Ann Garrison
Unworthy Victims: Houthis and Hutus
Julian Vigo
Britain’s Slavery Legacy
FacebookTwitterGoogle+RedditEmail