Tuesday, June 03, 2008



A couple of serial flip-floppers

While Bush and Rove are trying to shove Mitt Romney down McCain's throat, McCain is hoping that he'll at least be allowed to pick someone he can stand being in the same room with-- like Alaska Governor Sarah Palin or Minnesota Governor Tim Pawlenty.

Last week Pawlenty probably killed his chances to ever be elected to anything in Minnesota again but he may have had a different audience in mind. And it goes beyond just the fact that in 2006 his biggest campaign contributors were from the real estate industry. He vetoed the Foreclosure Deferment Bill-- something sure to endear him to fat cat GOP donors... and John McCain. He didn't seem to care that "the measure would’ve kept nearly 15,000 Minnesotans from losing their homes by giving them the time and authority to renegotiate their loan terms while they make a required good-faith effort to pay."
U of M professor Prentiss Cox, a former assistant attorney general who helped create the bill with Sen. Ellen Anderson (DFL-St. Paul), says Pawlenty’s reasons for killing the bill are short-sighted. “This is a false allegation in this context, in my opinion,” Cox says. “There is no substantial subprime or negative amortization mortgage credit being issued to homeowners right now. A law can’t have an impact on credit that doesn’t exist.”

The bill would’ve required homeowners with a subprime or negative amortization loan originated before August 1, 2007 to pay either 65 percent of the payments due when the loan defaulted, or the minimum monthly payment when the mortgage was first created, whichever is less, for a one-year foreclosure-deferment period.

The bill’s originators created the plan as a stop-gap to state foreclosures before the federal government implements a solution to the growing crisis. It would’ve been the only law in a series of subrpime-crisis legislation that would provide relief to homeowners in the foreclosure process. So far, Minnesota has been at the forefront of creating anti-predatory-lending laws that make certain types of mortgages illegal and require tougher standards for mortgage brokers.

“This notion that lenders will refuse to make financially sensible mortgage loans of a different character in the future based on Minnesota helping subprime borrowers now can accurately be described as a threat of class warfare,” Cox says. “It may make good, if divisive, politics-- inciting fear in the affluent against homeowners in need-- but it doesn’t make sense from a market perspective. And such threats, which are consistently made against any proposed laws designed to help consumers in the financial services area, have a track record of being wrong.”

Another way Pawlenty decided to burnish his v.p. credentials was to flip flop on (as in against) stem cell research. He went from encouraging the legislature to support research because it "offers tremendous opportunities to improve human health and well-being by addressing serious diseases such as diabetes and Alzheimer's" to vetoing the bill on Friday. Sounds like a perfect match for McCain.

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