Wednesday, October 29, 2008
U.S. government finally focuses on foreclosure victims
Thousands of foreclosures and $700 billion later, has the U.S. government finally recognized that its responsibility is to its citizens, not to its financial system? The Reuters international news service reported Wednesday that regulators are working on a $600 billion program to keep homeowners from losing their homes to foreclosure. As many as 3 million foreclosures could be avoided under the plan being drafted by Treasury and the Federal Deposit Insurance Corp., Reuters said. The plan provides federal guarantees to encourage lenders to ease the terms of troubled mortgages at minimal cost, since the intent of the program is to prevent defaults on home loans, according to Reuters. "We are working with the White House and through the policy process on a range of foreclosure-prevention options," Treasury spokeswoman Jennifer Zuccarelli said. That's about the best news yet in the financial crisis threatening to cause a worldwide recession or worse, and it's about time. Instead of worrying about where the banks that caused the problem are going to get taxpayers' money to pay dividends to their shareholders, it's about time somebody paid attention to the real victims of the lending meltdown. "We're always reviewing proposals to help homeowners," White House spokesman Tony Fratto said, as if nobody has been paying attention to the attention the Bush administration has been paying to wealthy investment companies. The government will be announcing the program in the next few days, an unnamed source told Reuters.