Below The Beltway

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Obama Administration Set To Unveil The Next Unconstitutional Bailout

This time, it’s a mortgage bailout:

The Obama administration plans to overhaul how it’s tackling the foreclosure crisis, in part by requiring lenders to temporarily slash or eliminate monthly mortgage payments for many borrowers who are unemployed, senior officials said Thursday.

Banks and other lenders would have to reduce the payments to no more than 31 percent of a borrower’s income, which would typically be their unemployment insurance, for up to six months. In some cases, administration officials said, a lender could allow a borrower to make no payments at all.

The new push, which the White House is scheduled to announce Friday, takes direct aim at the major cause of the current wave of foreclosures: the spike in unemployment. While the initial mortgage crisis that erupted three years ago resulted from millions of risky home loans that went bad, more recent defaults reflect the country’s economic downturn and the inability of jobless borrowers to keep paying.

The administration’s newest push also seek to more aggressively help borrowers who owe more on their mortgages than their properties are worth, by encouraging lenders to cut the loan balances of millions of these distressed homeowners and possibly refinance into loans backed by the Federal Housing Administration. The problem of so-called “underwater” borrowers has bedeviled earlier administration efforts to address the mortgage crisis as home prices plunged.

Once again, I ask what provision in The Constitution authorizes the President to do this, and by what right do they purport to intervene and rewrite the terms of a private contract ?

But, that was a question more appropriate for an America where the Constitution and the Rule of Law actually meant something.

6 Responses to “Obama Administration Set To Unveil The Next Unconstitutional Bailout”

  1. Chris Berez says:

    I read this a couple of hours ago and my first thought was: “I should probably be angry about this.” And then I thought, “Fuck it, why bother?” and I moved on with my evening.

    I only say that to illustrate how far we’ve come in the past two years. At this point I’m simply trying to accept that the damage is done, and it’s only going to keep getting worse.

    Have we reached a point where we can declare Directive 10-289 passed yet? Or do we still have that on the horizon?

  2. [...] a comment to my post about the Obama Administration’s impending announcement of yet another [...]

  3. Let's Be Free says:

    And this reveals the most profound damage of the health care bill ram through — the Obamaistas are emboldened now to operate without limit or restraint on all fronts. It will only get worse.

  4. Tom Kuettner says:

    Unfortunately we have not operated under the constitution since the war between the states. Hopefully this will anger the controlled masses enough to stand up for their rights.

  5. Nick says:

    Of course, Article 1, Section 10 specifically prohibits the states from passing a “Law impairing the Obligation of Contracts”. Somehow the point that the Federal Government is not allowed to do anything specifically listed, especially that, was lost on most Administrations of late.

  6. tfr says:

    Yah, I must admit, the pace at which things are going downhill is surprising to me. I don’t know whether to expect 70s-style stagflation or just a plain ol’ civil war at this point, but *something* is going to give.

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