I came across this flyer (above) while doing some spring cleaning this week. Some friends of mine were going to this particular event, and gave me a copy, "just in case," but I had something to cover that night, I think. So I didn't make it.
But it's a fascinating blast from the past. An eviction moratorium from 2008? It's enough to make me say, "Holy Groundhog Day, Batman!" Because here we are again, in more or less the same place, only with far more damaging effects. Roughly three million homeowners are behind on their mortgages, while an additional 2.1 million are relying on mortgage forbearance, due to COVID-19-related hardships. (Forbearance refers to the process of delaying foreclosure by giving the borrower a specified time to catch up on their past due amount.)
The Biden administration has extended a national foreclosure moratorium through June 30. Borrowers can also apply for forbearance through that date, if they wish, though the Consumer Financial Protection Bureau is proposing a new rule to extend those protections through next year (see link below).
The agency would also ask more from lenders, such as requiring them to make a "live contact" (read: phone call), and spell out options for borrowers. In some instances, they might not be able to charge late fees, interest or past late fees, which can make it tougher to catch up. We'll see what happens after the May 11 deadline for public comment passes, but it all sounds good, on first glance.
Looking back, then, the excuses that greeted State Senator Hanson Clarke's proposed two-year foreclosure moratorium in 2008 seem sadly familiar, ranging from "Lenders will go elsewhere" (they didn't, especially after the $700-800 billion bailout took effect), to, "they can plead their case to a judge" (not anymore, once the final three-year redemption period expires), to, "why should lenders wait longer for their money?" (they hold all the cards, anyway, so what's the rush to kick people to the curb?).
I'm sure that those dreaded cliches of "Big Government" and "Full-bore socialism" got tossed around a fair amount, too. As we all know, that's the standard response whenever people get tired of feeling the fat cats' feet on their necks.
Not that banking interests had any reason to lose any sleep, given how many of the past and present Republican majorities their dollars bought them, notwithstanding the flyer's call to action ("Only a mass outpouring of people from all around Michigan will force the State Legislature to pass SB-1306").
Would a mass outpouring have made a difference? I don't know. Don't forget, we were about to enter the Rick Snyder era, followed by the neutering of democracy in (mostly) majority black cities like Flint, and the poisoning of its residents' drinking water.
Such horrible outcomes happen when business and governmental interests get too intertwined for comfort, which is why I'm not ready to hand Biden the transformational President medal he covets. Yes, he seems off to a decent start, and he's been a pleasant surprise, for actually keeping progressives in the loop (compared to his predecessors, Clinton and Obama, who largely kept them at arm's length, or on the bench, depending on what they felt their latest muddle dictated).
The mainstream media seems pleasantly surprised, too, judging by the questions they're posing (as the New Yorker did last month, for example: "Is Joe Biden Really The Second Coming Of FDR And LBJ?"). But let's see what happens. After all, Biden comes from a generation that puts government action and market solutions on a similar par.
This is the essence of neoliberal policymaking. Tinker with the existing system, but whatever you do, don't try to transform it. Just fix whatever doesn't seem to work, and then, step out of the way. The only problem with this approach, as we saw in 2008, is that it rewards a handful of winners, but leaves out a slew of losers.
It need not have taken a pandemic to finally arouse our government to act, and take actions that seemed unthinkable back then -- such as telling lenders to stop acting so predatorily, and wait a bit longer to cash their chips. But that's what went down, and that's why we're here now. Never forget that. --The Reckoner
Links To Go (Hurry, Hurry,
Before Your Stuff Ends Up On The Lawn):
The Metro Times: Foreclosure Fight:
https://www.metrotimes.com/detroit/foreclosure-fight/Content?oid=2193382
The Mortgage Reports:
No Foreclosures Until 2022?
CFPB Seeks To Extend Foreclosure Moratorium:
https://themortgagereports.com/75868/cfpb-foreclosure-moratorium
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