Alinskyian networks of community organization involve congregations nationwide in support of mortgage foreclosure prevention schemes.
One of the larger Alinskyian networks – the Pacific Institute of Community Organizing (PICO) – has launched a “National Campaign to Stop Preventable Foreclosures.”
Alinskyian networks of community organizations involve congregations around the country – from all denominations. They expend a good bit of energy to influence legislation and public policy, generally along “progressive” lines. In this case, PICO has approached the US Treasury Department, Congress, and various lending institutions “to adopt a new systematic approach to stopping preventable foreclosures”.
Of course, that description, taken from the PICO website, needs some explanation – which it provides in policy paper, “Too Big to Fail.” All we need to do, it says, is “turn non-performing mortgages into performing mortgages.”
Sounds simple enough. After graphically describing the broken lives of the foreclosed and boarded up neighborhoods with gangs moving in, the PICO report offers its solution. Would-be homeowners, who have been seduced by unrealistic “mortgage products” offering borrowers low payments that eventually increase beyond their capacity to repay, simply require a mortgage “modification.” That’s all.
“The current system for turning non-performing mortgages – modifying loans on a case-by-case, individual basis,” the PICO document says, “is not working.” Using the experiences of Contra Costa County, California as its model, PICO believes a FDIC (Federal Deposit Insurance Corp) takeover of banks holding subprime adjustable rate mortgages will solve the problem. The FDIC then can offer mortgage holders the “modifications” – the loan adjustments – they need to stay in their homes. What could be easier? Problem solved.
Interestingly enough, Sheila Bair, chair of the FDIC, reads from the same script. “The continuing trend of unnecessary foreclosures imposes costs not only on borrowers and lenders, but also on entire communities,” she has said. “Foreclosures may result in vacant homes that may invite crime and create an appearance of market distress, diminishing the market value of other nearby properties… The FDIC has strongly encouraged loan holders and servicers to adopt systematic approaches to loan modifications that result in affordable loans that are sustainable over the long term.”
If one had a suspicious turn of mind, one might imagine there was some collusion here. Under this proposal, according to FDIC spokesman David Barr, the FDIC will receive 80% of the loan’s cash flow until some unspecified level of payment is reached and then 60% thereafter.
Over at the Short Sale Blogger, this has raised some eyebrows. “Dave” writes, “If I were the buyer of these loans, this would be my game plan:
1. Buy loans for 30 cents on the dollar
2. Network with Barney Frank
3. Network with Sheila Bair
4. Get some new housing stimulus passed to “help distressed borrowers” REFI for 70-80 cents on the dollar (if that doesn’t work then do a short sale, if that doesn’t work then foreclose)
5. Pocket the difference
6. Rinse, repeat.”
And here are the clergy and congregants from more than 40 states, brought together by the organizers of PICO, demanding that the Department of Treasury require all banks getting a federal bailout package to adopt its systematic loan modifications. “Remove the veil between the people of this nation and the people in authority. Pierce the veil of Secretary Paulson and Congress and move in their hearts today,” one PICO-associated pastor prayed, to the crowds shouts of: “Wake up! Wake up, Secretary Paulson!” and giving him a letter signed by more than 500 clergy, asking him to end the foreclosure crisis according to PICO’s determination.
Wake up! Wake up, you useful idiots! You and your churches and your compassion for the “little guy” who is losing his house are the pawns of a scheme that is only beginning to be brought into the light.
See them in action: VIDEO: Faith Groups and the Foreclosure Crisis:
By Kim Lawton – PBS, Religion and Ethics NewsWeekly
…Faith-based community activists are talking with the Obama administration transition team about how the government can do more to stop preventable foreclosures.
Copyright © 2009 Spero