Journalism in the Public Interest

What Elections Could Do For the Foreclosure Crisis, FinReg, and Other Issues We’re Watching


People cast their votes at the Gilpin County Courthouse on Nov. 2, 2010, outside of Central City, Colo. (Matt McClain/Getty Images)

As Americans go to the polls today, their votes will influence a number of issues that we’ve been watching, whether it be the foreclosure scandal or implementation of financial regulation and healthcare reform—some of our favorite topics. So here’s our attempt to parse some of the election coverage and bring these issues into sharper focus:

Foreclosure Crisis

In the wake of a foreclosure-documentation scandal that has grabbed headlines for more than a month, Elizabeth Warren, who’s leading the Obama administration’s Consumer Financial Protection Bureau, said, “Right now my money is on the attorneys general,” who in October launched a joint investigation in all 50 states.

Midterm elections, however, could present a complication for that investigation, given that 30 state attorneys general races are being decided today. As the Washington Independent reported, some of the state attorneys general who’ve been most active in the investigation are either engaged in close re-election contests or are set to leave their posts. More from the Independent:

Consider this: Of the 12 state attorneys general on the executive committee of the coordinated investigation, only two of them — Roy Cooper in North Carolina and Rob McKenna in Washington — aren’t up for re-election this year. Several of them — Jerry Brown in California, Richard Blumenthal in Connecticut, Terry Goddard in Arizona, Andrew Cuomo in New York and Bill McCollum in Florida — are running for higher office and will not return to their posts. And other races are closely contested.

Currently, 32 of the 50 attorneys general across the nation are Democrats, to 18 Republicans. According to Governing Magazine, the GOP is poised to pick up anywhere from six to 13 of those seats after November, dramatically changing the makeup of the attorneys general across the country — and potentially the nature of their investigation.

Two notable cases include Ohio attorney general Richard Cordray and Iowa attorney general Tom Miller, both of whom are up for re-election today and are members of the executive committee that is leading the probe.

Miller, who has tracked mortgage-industry practices for years, is the investigation’s point man. And Cordray is the only attorney general so far to have filed a lawsuit against a servicer—GMAC—for its foreclosure practices. The Ohio Democrat has promised that the foreclosure probe will continue past the elections, but he’s currently locked in a race that Governing magazine is still calling a toss-up.

Financial Regulation

According to a piece in today’s New York Times, if the predictions are correct and Republicans gain more control in Congress, elections will likely leave the financial industry in a much stronger position and blunt the effect of the financial reform bill:

A Republican victory would also shift control of the oversight and appropriations process in Congress, and lobbyists are hoping that means less money for agencies like the S.E.C. and the C.F.T.C. to hire staff and aggressively enforce the Dodd-Frank financial regulatory reform bill passed this summer.

While that bill is already law and a rollback would be tough, other attempts at an end-run around it are likely, especially if the Senate also switches hands. In that case, Republicans could block appointees the industry considered hostile at the Treasury, as well as at the S.E.C. and C.F.T.C. Nominees for two of the five commissioner’s seats at the S.E.C. will require approval by the Senate during the next session, while the term of one commissioner at the five-member C.F.T.C. expires.

“At this juncture, gridlock is good,” Richard Hunt, president of the Consumer Bankers Association, told the Times. “It’s time we take a breather from all the excess of regulation and Congressional legislation. Our members and customers are ready for common sense to reappear.”

Health-Care Reform

Much of the campaign rhetoric this year has dragged incumbents’ health-care reform votes through the mud, putting lawmakers who voted for the unpopular bill—or even those who at one point helped—on the defense.

Republican wins in both Congress and statehouses throughout the countrywould likely “slow down implementation of the law and make the debate even more contentious—but not outright stop the law,” according to Politico:

“I think if they don’t fully repeal it and replace it, they will make such big changes in it over the next three years that you won’t recognize it,” Republican Governors Association Chairman Haley Barbour said Sunday on NBC’s “Meet the Press.”

Given that the law has already passed and the likelihood of repeal at the federal level is low, NPR points out that those interested in how well it’s implemented should watch what happens the state level.

Elections in more than three dozen states will help determine who becomes the state’s insurance commissioner, whose job it is to police insurers and enforce the law’s new consumer protections. In four states—Georgia, California, Kansas, and Oklahoma—insurance commissioners are being directly elected by voters today.

In a number of other states, whoever is elected governor today will appoint a health-care commissioner, and in some states, these gubernatorial candidates have voiced opposition to the law as a whole, NPR reported.

Three states—Arizona, Colorado, and Oklahoma—are also voting on ballot measures that would prohibit enforcement of a key provision in the reform bill that requires most everyone to have health insurance by 2014, according to Kaiser Health News. At least eight other states have already approved similar statutes, though not changes to the state constitution.

Policy analysts and legal experts, however, aren’t putting too much stock in these efforts by the states, which they say are just for show.

“It’s more of a polling statement," Elizabeth McGlynn, an associate director at the research organization RAND Corp., told Kaiser Health News. "It's not clear to me in this case that the federal law wouldn’t override state mandate. … [T]hat will be something the courts decide.”

Other Issues Move Off the Back Burner

It’s also worth mentioning that getting past the elections—no matter who wins what—could also set in motion a number of issues that have for months been put on the back burner amid all the politicking.

Those include a stalled food safety bill—the importance of which was highlighted by salmonella outbreaks earlier this year.

Two prominent Democrats, Reps. Charles Rangel and Maxine Waters, will at last face ethics trials that had been moved until after the elections—despite requests from both to have their hearings held before midterms.

A New York Times piece today reminds us that the Bush tax cuts expire in 59 days, and that debate will likely be an issue again in the near term. It, too, had been postponed because of the elections.

And that's just to name a few. If you’ve got more examples, feel free to leave them in the comments.

Campaign finance disclosure is also in jeopardy, in spite of the wave of undisclosed money this election.  Likely House committee chair will focus on voter fraud and military voting.  He spoke out in favor of the Citizens United decision last January.  DISCLOSE Act tough to pass during lame duck session.

Neil Garfield has done an extraordinary job of collecting the truth about the mortgage meltdown and is working hard to inform other attorney on how to fight for their clients and win.
I suggest that someone check out the above website that deals almost entirely with foreclosure fraud and all its ramifications.
People are still lining up to try to get unneeded modifications that are doomed to fail and put them further into trouble.
There is so much more to this story than a bunch of subprime loans and deadbeat homeowners. MUCH, MUCH MORE!
It’s taken me months of study to fully understand and grasp what has happened to our country, it’s such an enormous, incredibly huge scandal that it almost defies belief!
I have a real estate license and I was trained as a mortgage broker, so I know for a fact that all the mortgages were set up to fail, eventually.
That was the purpose of making the loans, it didn’t matter who got one, it was primed to fail.
Someone needs to cover this story from an objective viewpoint and maybe, get the message across that this is not what the lenders made it out to be, deadbeats who fail to pay.
It’s outright fraud.

“At this juncture, gridlock is good,” Richard Hunt, president of the Consumer Bankers Association, told the Times. “It’s time we take a breather from all the excess of regulation and Congressional legislation. Our members and customers are ready for common sense to reappear.”

This must mean Mr. Hunt and his industry are ready to commence Economic Meltdown II, and return to free markets, that wreck most consumers by reducing their individual wealth by 50 to 30 %, while those same folks who lost gave bailout funding to Bankers so they could maintain and increase their net worth by 60%.
What a country screw the small guy every which way you can and then cry for common sense.

A Republican victory that results in the banks getting free passes again will either yield a complete wipeout of the Republicans in 2012 or my toasting the demise of America.

A toast made, to be more precise, to my reluctant acceptance of the fact that the American people either truly don’t care about the future of their children or they have given up hope and consciously chosen to sacrifice many, many other Americans if it offers them even a hint of a possibility of maintaining their immediate, precariously-balanced situation - either way, the demise of America.

I have a feeling the teabagging/gop’s bullying will be short lived.

In two years most of the freshman teabagging/gop will be thrown out of office. Not every state is a red state, thank goodness.

Cheryl and Sirgil- Both of you hit the nail on the head. It is something that all AMERICANS need to address (the transfer of wealth has been the largest in the history of man this past decade).
This applies to the members of Akron RFC (since you gentlemen have posted you have been following my posts here), if this does not affect you or anyone you know…I say you are not an AMERICAN!
Please excuse me as I am on my way to vote. I pray that even in some small way that it might make a difference. Especially to people like the woman and her child in the article in yesterday’s Bloomberg “Mortgage Modification Failures Push Borrowers Into Foreclosure.
May GOD Bless All!

Bruce Fernandes

Nov. 2, 2010, 4:16 p.m.

This wealth transfer stuff is baloney.  The fact is the tax system is about collecting taxes.  I doubt that Oprah or Warren Buffett or all the libs out there would stand for an immediate tax on wealth.

Rather than take more taxes from families earning $250K which in high tax states like NJ, NY and CA is meaningless let’s take 10% of Oprah’s billion dollar wealth.  I’ll bet old Oprah would pitch a fit.

You see, the rich libs do not care about a few percentage points of taxes as long as their net worth keeps growing.  But tax away real wealth and libs will be the newly converted to the tea party.

I count myself as a progressive Mr. Fernandes. And I live in high cost California. I would gladly support increased taxes on incomes over $250K. Even lower!

There is a big difference between subsistence and wealth in this country. Back in the ‘60’s I used to rail against the unions as too powerful. Unfortunately, I wasn’t around when the barons ran this nation into the ground and had no idea how bad it could get.

Now I know, and I say now I was ignorant and mistaken. We need to go back and raise the worker to his and her rightful place in society.

Workers are not here to just be “consumers”. They deserve a shot again at the middle class status they enjoyed back then. Not fueled by false growth from the equity in their inflated homes, but instead by hard earned concessions from employers.

The pendulum has swung too far. Time to start back the other way.

Peggy- Your statement was not only eloquent, but to the point.
I also had a negative view of unions earlier in my life. As an owner of a construction company I used to laugh when I would see union workers, where you would mostly see a few actually doing work, but several others just standing around.
After joining a union years back I have come to find that their level of pay and committment towards the members is far better than the private sector.
I would also support tax increases even on those much lower. Even though I live in Hawaii…and I’m already experiencing some of the highest taxation per capita in the nation. My only stipulation upon supporting would be that it would lead to a more level playing field for those with incomes at or below the national average.

All good comments, the ones from the folks who support the people who have transferrd the middleclass wealth to their own pockets,  those comments speak for themself. Any basically educated individual should be able to see through the smoke they generate.
It is amazing how the upperclass wealth in this country has convinced the common class voter to vote against their own best interests.
This phoenenom started with the Reagan election in 1980 and has moved forward by leaps and bounds.
Is it any wonder why Bush 43 never funded “No Child Left Behind”

Let them fix it. Republicans claim they have all the answers, so now let’s see what they can do when they share control of the Congress.

Now that the republicans took controll, I guess we can all pack our stuff because half of America will become homeless. If they let us pack.
Exploitation and foreclosure will skyrocket. Bankers on wall Street now will have a huge party which you and I ‘ll pay for.

God help us all.

I think the House Republicans are in for a rude surprise if their agenda is to re-install the Bush legacy that got us here. All they’ll do is ensure the president’s reelection.

That said, I wish the president hadn’t wasted time when the power was there and his support was at a peak. The foreclosure mess is a twofold problem—people have lost jobs and income to keep up with their bills and also the banks have gotten ridiculous. I notice no one asked about banks and such at the press conference, a curious oversight for such a horrifying problem. 

The president has to re-invigorate his base by working on the things he was elected to do.  We never expected 100% success, but we did expect a lot of mano a mano fighting—12 rounds!

I share your disappointment that President Obama has failed to take full advantage of the “Bully Pulpit” Tee. It surprises me too, because that’s how he came to our consciousness in the first place: with his marvelous oratory.

I do credit Obama’s finally taking charge of the health care legislation with getting it passed, he and Pelosi. But then again, it wasn’t really the single payer bill I would have liked to see. The Dems bent over backwards to accommodate the right, the health insurance companies, big pharma, etc. In the end they might as well have shoved through single payer and told the right to stick their amendments, because there was no support or team effort from the other side.

I too work in construction Roy: as a designer specializing in kitchen and bath remodeling. Our industry has taken a real beating from the financial crisis; probably worse than any other. And it doesn’t look like things will improve any time soon.

Our best hope for work for our industry is legislation to combat global warming and cut our energy use. But that sits in the roadblock of the Senate.

At least we in California see the light and are doing our part. We have legislation on the books and some construction people are working here because energy retrofitting is the only work there is.

As an inveterate news junkie, who mourned Bill Moyers’ retirement,I would like to thank ProPublica from the bottom of my heart for the great job you are doing here. It’s about time we had a place to go to read real investigative journalism.

The Republicans are about to find out that wanting and having are not the same. Now the responsibility falls right into their lap to fix things the administration before screwed up! Chase, Bank of America and all the other mortgage lenders got together and created MERS and screwed the states and counties out of billions of dollars in taxes and filing fees during the housing boom. That lead to lay offs, cutbacks and empty pockets that should have had a surplus, if every real estate and investment transaction had been properly recorded as required by law!
Instead, MERS brags about how much money they saved the banks by cheating the states! It’s right there on their website as part of the promo for membership! Part of Wayne county MI had over 44,000 foreclosures in 2007, those sheriff’s sales should have netted at least $6,600,000 in filing fees alone. That’s money lost that’s legally owed the county. This is outright theft and banks are above the law in their own eyes!


Nov. 3, 2010, 7:19 p.m.

Like i said before Banksters need to be a essentially and substantially more REGULATED, Let me just tell you in 3 phrases what i believe this country needs to do with these Banksters, so this mess does not happens ever again REGULATE THEM, REGULATE THEM , REGULATE THEM !
Yes REGULATE every single transaction, Foreclosure,  DCO’s,  Derivable s, Credit Cards, Bail out ‘s etc REGULATION is the key, if these Banksters are REGULATED they can not extract and suck the money and the wealth from this country, the middle class and they will not be able to be trowing whole families in the street with their FRAUDCLOSURES as they have been doing it for so long REGULATION ! REGULATION ! INTENSE REGULATION ! AND MORE REGULATION, REGULATE THEM TO THE TEETH
And finally,  Break up the Banksters yes that is right Break them in to pieces so none of them are worth more that a few Billions and this way you will create more competition and they will never ever be TO BIG TO FAIL ever again


I see comments about not objecting to higher taxes.  This seems a bit foolish to me at this point.  How about we make our government spend the current taxes properly.  The currently take in around 2.5 trillion and spend around 3.5 trillion.  There is some much waist it is not funny and our defense budget is absurd!  Increased taxation is not healthy for a faltering economy.  Get spending in check and get corporate income taxes in line (we shouldn’t be the second highest in the world), get jobs back in the country and pass some regulation to require companies to stay and things will change.  Honestly the biggest problem is we need to regulate out government, term limits, lobbying without transfer of assets of any type, and government financed campaigns would be a start. 

Don’t fool yourselves in to thinking that the democrats or republicans are fixing things.  The democrats were all about regulating in the banking industry but they were trying to regulate at lowers levels than they needed to like the loan officer level.  Although there are some scum bag loan officers out there the problem is at the top and in Wall Street.  Both parties have been bought folks WAKE UP AND REGULATE THE GOVERNMENT IF WE DON’T WE FAIL.


Nov. 4, 2010, 1:40 p.m.

I agree regulate the govermnet especialy corporate money, banksters money, wall street money, oil money, agricultural money and pharmaceutical money. At the Same time regulate the banksters to their Teth and we ll have a 300% better America

I am assuming when you say banksters you mean the guys at the top.  This is the only place regulation will be affective.  I think regulating the government would allow for a lot of positive change.  Right now it does not matter if you vote democrat or republican, they both equal big business running America. 

If you regulate govt. first, the rest will fall in line over time.  Taxation is not the key though.

Let’s not forget that we’re still engaged in two wars.  At at time when we need to be focused on exiting them, domestically we’re captivated by who’s in charge.  How is it that in all the rhetoric, no one thinks to support (or withdraw) the troops anymore?

Sorry I did not bring that up but you are correct.  I believe that through regulating government and putting some of the things in place I am talking about will put an end to the incredibly strong influence of the MILITARY INDUSTRIAL COMPLEX.  That would stop war that is over money for the most part.  We would still hold a strong military and possibly go to war but it would not over money.

It’s started already, the repubs have sworn to blame the borrowers. After all, if we had never balked at being thrown out of our houses and just moved quietly and let them sell and resell our houses there would never have been a meltdown. We were bad and now must be punished!
They don’t even get accused during the “investigations”
Fine example to give people, let’s show’em that bankers are above the law, the law is for those stupid enough to obey them.

Between giving most of the federal budget to the military and making sure the generals get all they want, there isn’t much left for the rest of us to fight over. But we aren’t supposed to complain because after all, they are fighting for our freedom in Iraq and Afghanistan, right? They make our world safer for the bankers to steal us blind. We can rest assured as we huddle in our cardboard cities that we are safe from being booted out by rogue bands of theTaliban.
We have no fear because we are pouring billions a week into the endless war that no longer fights anyone nor accomplishes anything remotely resembling an ending or withdrawal and we must remain until our mission, whatever that is or was, has been accomplished.

Cheryl, you estimation of the bankers is correct.  I think you need to make a distinction though.  When you say bankers you actually mean wall street.  They are the same now I believe.  Large investment banks that are stealing the wealth and taking homes.  The way I see it, they set up the failure of the system to profit.  This failure of the mortgage market was intentional and it spread in to all parts of the economy.  Now you experience massive job loss, now you loose your home.

We will never control the banks until we control the government.  Personally I think it is too late for our country.  We keep fighting back and forth about democrat and republican when they both SUCK the life out of our country.  Most people are so clueless it is pathetic and too lazy to do any type of research.  I was ignorant too until the mortgage market was upset (I was a broker) and brokers were blamed for the mess.  There certainly were brokers that were bad and needed to be removed but to blame them for what they could not do seemed absurd to me.  That was until I realized the the banks own Washington.  They had to blame somebody and the brokers have almost no lobbying force.

It’s all a pathetic mess and if we don’t take the government back it will end in a very ugly way.  It might be a good idea to start preparing for very bad times.

Nissim Sasson

Nov. 5, 2010, 4:04 p.m.

You guys want to know What Elections Could Do For the Foreclosure Crisis?
Here is a hint one of the first meetings the Republicans, and the Republican and their financial comities had yesterday was with Goldman Sucks and JP Morgan Chase !

Bankers, banksters, wall street, politicians, all the same ilk, criminals all.
We are becoming the United States of Crime in high places.
There is no country any more only businesses and corporations.
And we are the grunts working our asses off to stay legit, do the right thing, raise our kids right, be good parents, be responsible adults, stay honest, obey the law, pay our bills and support whatever crap is fad for the day.
We must consume or the market will fail, we must pay the fines, fees. taxes, and interest penalties. We get to be victimized so much it seems normal. Getting tired of living in a corporation instead of a free nation.
The only weapon we have besides lawful rebellion is to deny them our money, stop buying and paying bills, debts and goods.
Screw them all.
Time to go steal a house for fun, the banks do it, obviously there is no penalty for doing that!

A lot of you share my same sentiments about what is happening. Let me refer you to a bumper sticker I saw “Same Crap-different piles.” We’ve stepped in it. Oh yes keep the constituents arguing amongst themselves and our elected officials can do what they (their special interests) want. We elect them though we don’t matter. We are collateral damage. I think we should stop voting and start lobbying that’s where the power in this country is at. Oh yeah that takes money and also being in housing manufacturing (custom woodworking) I’m doing everything I can to hold onto what I have my building(bought for my retirement) and my tools (to continue to work) I don’t have money to pay the Rod Blogyviches (sp ?) in office for my self-betterment. Can someone please explain the difference what he did and an ELECTED official taking lobby money. It’s all for self-perseverance and self-financial gain. Bottom line.

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