Posted on 01/29/2006 6:51:06 AM PST by Uncle Sham
Political Horizons for Jan. 29
Baker’s relief bill deserves try
By JOHN LAPLANTE
Published: Jan 29, 2006
Ford to City: Drop Dead,” a legendary headline screamed in 1975, when a president refused to bail out New York City from financial disaster.
Change the president and the locale, and Louisiana hurricane victims might be forgiven for thinking the same thing.
After hemming and hawing for months about U.S. Rep. Richard Baker’s home-buyout bill, and never really saying what he had against it, Bush brushed it aside last week.
Only after aides revealed his opposition did Bush grant a one-paragraph explanation. It amounted to three things: Don’t create more bureaucracy; we already gave you people lots of money; and Louisiana doesn’t have a plan.
Baker and Gov. Kathleen Blanco countered the Baker bill is so important it amounts to “the plan.”
Blanco said she only really controls $6.2 billion in recovery money that will be stretched far too thin to aid owners of 200,000 destroyed or damaged homes.
She said opposing bureaucracy is an odd argument for any federal officials to make.
What she should argue is that Baker’s bill is a plan for people, not politicians.
Yes, the bill would set up a new bureaucracy called the Louisiana Recovery Corp., but this is not an open-ended promise to hand out money to politicians or write checks to the idle.
The LRC is supposed to be a hard-nosed business proposition. It would pay willing homeowners some, but not all, of the equity in their homes.
If they have a mortgage, the agency would pay it off, giving lenders back some, but not all, of their investment.
The agency would clean up the property and, working with local interests, market it to investors for redevelopment.
The LRC should take some decisions from politicians and give them to homeowners. They could take less and get on with their lives or keep their property in hopes of working out a better deal some other way. The agency would not take land against the owners’ will.
The corporation could transform many homeowners from helpless victims to people with some hope for the future. It could block a wave of foreclosures that might wipe out tens of thousands of families’ finances.
It could help head off statewide economic stagnation and spur speedy, organized recovery for communities that must come back for the state to recover.
Baker said he’s not giving up. He sees support in both chambers of Congress and says he has passed significant legislation over Bush’s objection before. But the opposition of a president whose party controls Congress is a major setback.
In fairness to Bush, Louisiana leaders made it easy for him to so casually shrug off the bill.
Our U.S. senators tried to grab $250 billion on sympathy instead of catalogued needs. The governor and Legislature found money for political projects during the crisis and so far have done little to adjust state government to the vastly different needs. New Orleans Mayor Ray Nagin famously made blackness, not prosperity, his top goal.
Some Louisiana leaders also exude an air of entitlement, even arrogance, demanding Washington immediately turn over as much taxpayer money as the state demands.
The Baker bill is not another toy for Louisiana politicians to play with or a well-intentioned program for them to screw up. It should actually bypass the politicians by dealing mostly with residents and bankers and developers.
Bush would appoint the managers of the agency, with Blanco suggesting only two. The U.S. treasury secretary would have final say over how much money the agency can borrow.
The bill is founded in Baker’s long expertise in the complexities of housing finance and the federal government’s long interest in affordable homes as a big part of the American dream.
Baker’s bill also is complex and in some ways unprecedented, and who knows how wily politicians, lawyers or speculators might try to abuse it?
Baker says he is willing to compromise. He should be. Louisiana is asking the nation to take a huge risk by borrowing up to $30 billion. Limits and controls are appropriate to minimize the chance of abuse.
Risks and reservations should not sink the bill without a proper airing.
The idea is worth more than months of foot-shuffling and a sudden brush-off by the president.
The 200,000 families that might directly benefit from it, and the 4.5 million Louisiana residents affected by their state’s continued crisis, deserve a hearing.
John LaPlante is Capitol bureau editor for The Advocate.
I just read the whole text of H.R. 4100 (pdf at House committee on Financial Services) Its Purpose:
•HR 4100 IH SEC. 5. MISSION, PURPOSE, AND DUTIES OF THE CORPORATION.
(a) MISSION.—The primary mission and purpose of the Corporation(Louisiana Recovery Corporation hereafter in this Act referred to as the ‘‘Corporation’’) shall be the economic stabilization and re- development of areas within Louisiana that were dev- astated or significantly distressed by Hurricane Katrina or Hurricane Rita.
(b) ECONOMIC STABILIZATION.—In executing its economic stabilization mandate, the Corporation shall, after consultation with State and local officials and pursuant to agreement that eligible properties are not likely to be redeveloped without Corporation assistance, locate and acquire real property (commercial and residential) in such a manner and subject to such conditions that, upon the consummation of any acquisition of real property securing a mortgage loan—
(1) the mortgagee’s debt shall be considered paid in full by the mortgagor; and
2) all title and interest in the real property securing such mortgage loan passes to the Corporation.
(c) REDEVELOPMENT.—In executing its redevelopment mandate, the Corporation shall, after consultation with State and local officials, carry out the following activities:
(1) Package for sale acquired real property in substantial tracts of land.
(2) Make improvements to such tracts of land so as to make the land suitable for sale and development, including such basic improvements as the following: (A) Construction and reconstruction of neighborhood roads.
(B) Repair or replacement of water and wastewater infrastructure.
(C) Similar activities necessary to maximize the return on acquired real property.
(3) Through a competitive bidding process, dispose of such acquired properties in a profitable manner.
(4) In consultation with State and local officials, provide for the protection and preservation of historical and other sites of cultural significance in such a manner that promotes local heritage and interest.
The risk is the Corporation could improve the properties it purchases and then find the fair market value is lower than the cost of improvements. Taxpayers get stuck with the balance.
Also, is my math wrong here (my calculator doesn't take billions), Baker says he is willing to compromise. He should be. Louisiana is asking the nation to take a huge risk by borrowing up to $30 billion. If I divide 30 Billion by 200,000 homes, thats $150,000.00 per home. I wonder what the median price of these homes were before the hurricane.
If this passes, I hope its not a boondoggle.
Yes, you must. We should not (those smart enough not to live in a swampland) give you one more dime. If you don't like the way things are going in NOLA, move, or fix it yourself!
It is not the Fedrool Gumt's problem, friend (meaning me and the rest of us taxpayers)! It's your friggin front yard!
Are you serious in believing that ideas and plans only are supported in official Congressional documentation? Consensus has to be built well before legislation is even considered, otherwise it's a waste of valuable legislative time. The point I was trying to make in general is that there has been knowledge about this plan within the halls of Congress for several months now. It has been discussed in both houses of Congress for several months and has been received widespread bi-partisan favorable reaction and support. For Bush to claim ignorance of this plan is not being honest. If it's spinning by anyone, it's Bush himself.
Oh really? You and your democrat bureaucrats are going to screw the rest of America to rebuild.....interesting. Welcome to FR, hope you brought your flameproof under ware.
The same people who smeared the administration's face in the feces just after the flood, now want that same administration to cough up hundreds of billions to bail them out. I don't think so.
When I see N.O. residents return and help rebuild their own communities instead of whining at FEMA for more and more and more, all while they sit on their collective ass - then perhaps the taxpayers should help. I say not another dime until they help themselves. I have great sympathy for those who are honestly trying to get back on their feet, but the bums demanding an endless handout are overshadowing you to the point where nobody can see you.
Just because they are the ones getting all of the airtime on the MSM, don't let it overide your ability to figure out that they have already been helped for the most part. Most of them were part of the Government cattle herds to be found in large cities across this nation and really had little economic loss from the storms. Most of the folks who are hurting big-time are just like we are, you and me, but with property that is worthless, a mortgage to pay on that worthless property, no home, and no job to go back to. They need assistance to help begin the process of rebuilding their lives. This plan would help them, not the ones we all see on TV. In addition, this is not a giveaway, but would be repaid as properties are redeveloped.
"As for me, I'm sick and tired of it. It's time for these people to pull up their bootstraps, and figure out how to take care of their own problems."
Agreed. The Government didn't re-build Chicago after Mrs. O'Leary's cow burned it to the ground. Same with the Peshtigo Fire, here in Wisconsin.
The huge San Francisco and Alaskan Earthquakes? No massive influx of aid from the Government there, either. Who rebuilt Galveston, TX? The Government? Nope. The People.
And the F-4 Tornado that destoyed a section of my neighboring town last summer? Just a week before Katrina hit? We're not getting a dime for the 43 million in damage that tornado caused. Our state government is working on building a fund for these types of natural disasters, though I'm not really for that, either.
LMAO!!
The "plan": Give us trillions of dollars and don't ask any questions.
Good post. For an audio-visual aid in seeing how a big corrupt city handles "redevelopmant", people should research how Philadelphia "redeveloped" the two blocks which were incinerated in the "Move" fire.
But your governor did ask for federal assistance. It happened to be denied because the feds thought the state could handle that amount of damage on their own. If that's all Louisiana had we could handle it on our own too.
Everything I've heard seems to indicate that the property owners would receive 60% of the pre-Katrina value of their property and the banks who hold those mortgages would drop the mortgage claims. Then, as property is redeveloped, the previous owners would have first options to repurchase their property at whatever the value is determined to be. Might be more than the 60% pre-Katrina, or might be less. Overall, the values should come close to balancing on another out as properties that ARE redeveloped will certainly be worth much more than pre-Katrina and properties deemed unsuitable for redevelopment will be worth less than pre-Katrina.
Exactly. Every year I watch as billions of federal dollars are poured into coastal areas to rebuild houses destroyed by hurricanes, rebuilt by owners that KNOW that the next hurricane will result in the same destruction. Yet those of us in the mid-west are on our own when a tornado randomly wipes your home off the map......I'm sorry for Louisiana, but I have read for years about the consequences of a major hurricane on New Orleans....my pity level is low.
I don't have the slightest problem with a loan. But you have a fellow Louisianan on these thread threatening extortion at the gas pumps to pay for rebuilding......I don't extort well.
Yeah, it's not y'alls fault ever, is it?
Yes. And that same idiot Governor ("Diamond Jim" Doyle, D, WI) is now suing Big Oil because he says Wisconsin is owed $88 Million dollars due to the increase in the cost of gasoline. He can't connect the dots between supply and demand and the shortages caused for EVERYONE due to Katrina & Rita. Understanding 'Economics 101' is always a shortcoming of the libs, though sticking their hand in when there's a big old barrel of cash available is their speciality.
I'm against him asking for ANYTHING for our state. The more federal money that flows in here, the more goes to further support liberal causes. I'm a total State's Rights type of gal, and the more we rely on the feds, the more they chip away at our rights as a State.
LA will be fine if the Free Market is allowed to work it's magic, as it has in other spots around our nation destroyed by natural disasters. Throwing money at a flood plain is just stupid, IMHO.
And before you retort, so is living in Tornado Alley, LOL! We had 27 of them in my county alone last summer. I spent a lot of time in the basement last summer, organizing my survival supplies while hiding from tornadoes. ;)
Yep. See my post #77. ;)
Hold up there,,, we dont want em back here either. At least relocated to other states, the criminal elements wont be able to blend in and hide from justice like they did in NO.
As far as rebuiliding goes all the Dims care about are precinct voting stations and busses to shuttle multi voters around NO. That's what is really bothering them! Without being able to keep the NO voting machines running they will not win hardly any more elections in this state.
I have to partially agree with Chocobrains Noggin, God was angry at NO, not for Iraq, but for the planned week long sodomy festival that was washed out!!!
fraud (frôd) n. 1. A deception deliberately practiced in order to secure unfair or unlawful gain. 2. A piece of trickery; a trick. 3.a. One that defrauds; a cheat. b. One who assumes a false pose; an impostor. [Middle English fraude, from Old French, from Latin fraus, fraud-.]
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