The Government Provides Welfare for Corporations
As of this morning, the federal government has taken over two of the country’s largest home loan corporations for fear that their collapse would mean dire straits for millions of home-owners. Fannie Mae and Freddie Mac’s mortgage contracts were so intertwined in the other parts of our financial system, including the banking industry, the credit industry and property value that leaving them to the market would have destroyed most people’s financial fates. The two companies owned nearly five trillion dollars of mortgages and securities in 2007.
In Election ’08, the economy has been the prime issue as the polling stats indicate a race barreling down to the wire. John McCain’s Republican party has to shoulder the blame for eight years of poor economic performance. Barack Obama and the Dems have to lay out a plan to rescue middle-class Americans from the mud, even as the housing market continues to stutter. McCain, however, has shown a lack of foresight on the issue of predatory lending to Black Americans, the practice that encouraged many unfit borrowers to take on dangerous, life-altering loans to own a home.
Blacks Suffer In Large Numbers, Chasing the Dream
In fact, African-Americans suffered disproportionately to the depredations of lenders who seized opportunistically on a growing middle class in that group. NPR highlights the groundbreaking report “Foreclosed: State of the Dream 2008“ for indicating a critical imbalance in wealth among African-American communities which may have caused otherwise stable borrowers to try for mortgage equity in a booming market. The report estimates the Blacks have lost nearly 100 billion total dollars in the downfall, and that there would be more to come if those companies lost more capital.
How does John McCain believe it should be handled? In a speech delivered to the Orange County Hispanic Small Business Roundtable, he states most home-owners do “what is necessary — working a second job, skipping a vacation, and managing their budgets” as the means to pay for a mortgage.
But what do his own finances indicate about his view of home ownership?
John and Cindy McCain’s Million-Dollar Homes
Suffice it to say, having a rich spouse allows him to flippantly dismiss a problem that devastates African-American lives now more than ever. His financial portrait reads like a laundry list of luxury items:
- On the McCain children: Their credit card bills peaked between January 2007 and May 2008, during which time Cindy McCain charged as much as 500,000 dollars in a single month on one American Express card and 250,000 dollars on another, while one of their two dependent children had an AmEx card with a monthly balance as large as 50,000 dollars.
- On Cindy’s home purchases: “When I bought the first one, my husband, who is not a beach person, said, ‘Oh, this is such a waste of money; the kids will never go,’” she told Vogue. “Then it got to the point where they used it so much I couldn’t get in the place. So I bought another one.” (The “other one” is valued at over 2 million dollars.)
- On the hired help: The McCains increased their budget for household employees from 184,000 dollars in 2006 to 273,000 dollars in 2007. The additional cash supports an “increase in the number of employees,” said the McCain aide, who did not say whether the growing staff stemmed from the addition of new properties to the family’s real estate portfolio.
With many of the nation’s homes in peril at the will of a volatile market, and the government bail-outs coming one after another, it seems McCain has no intention of curing what ails us. He and his wife are assured their lavish digs for years to come, meaning they will scarcely fret about people who have to “take a second job.” Banking regulation gone rampant in the Bush administration (and dating back to the Saving and Loan crisis of 1991 under Bush I), will go ignored in a McCain White House.
For all of his and Palin’s elitist accusations, the GOP is demonstrably ignorant about the plight of the Black home-owner, and possibly content to remain so. Rather than dismantle the system that makes imprudent loans possible, Sen. McCain seeks to “shrink government” by way of old Republican talking points. Meanwhile, the Blacks and Hispanics making this a historic election with record turnouts and financial contributions will be swept under the “post-racial” rug.
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