Obama Speaks on the Housing Crisis

Posted on April 9th, 2008 by saman

Democratic presidential candidate Barack Obama criticized Countrywide Financial Corporation, one of the biggest mortgage companies in the US, for its participation in the current mortgage crisis. He denounced the fact that the company executives will receive millions of dollars while homeowners are forced to sell their homes and workers lose their pensions. Obama stated that Countrywide is responsible for hurting the economy by its mortgage practices and helping to create the mortgage crisis we are now facing. Two million people are now in danger of losing their homes. Obama is hoping to win over voters who are hurting financially. Obama is one of the latest politicians to criticize Countrywide. This past January, Countrywide decided to sell itself to the Bank of America Corporation for four billion dollars after it could not overcome a cash shortage and record losses. Senator Charles Schumer criticized the Bank of America when the offered the president of Countrywide, David Sambol, twenty-eight million dollars to remain with the company and run the mortgage unit when the two organizations merge. Democrat Schumer requested that the Bank of America to reconsider appointing Sambol. Schumer believes the pay package is excessive. Additionally, according to a regulatory filing, two high level executives are going to receive a combined amount of nineteen million dollars in payouts. Foreclosures and defaults are at record highs and lawmakers blame companies such as Countrywide for lending money to individuals who could not pay the debt back. They lent money to homeowners who were a credit risk and then did not do enough to help these same homeowners to avoid losing their homes. Obama has shown disdain for lobbyists in Washington and portrays Hillary Clinton as beholden to special interest groups. Obama stated that Clinton believes Washington works the way it is supposed to be but Democrats should be in charge instead of Republicans. Senator Obama pointed out that mortgage companies have spent millions of dollars lobbying lawmakers in Washington to go against more stringent regulations on their industry. The senator says that financial problems and the lack of federal oversight is expected because no one is outraged enough about it. Obama has commented on the administration’s proposals to help homeowners do not go far enough. Obama stated that George Bush has finally realized that financial markets need some oversight but the president was not making regulations tighter and has not prevented predatory lending practices. Senator Obama has received over one hundred thousand dollars from employees of mortgage companies such as Fannie Mae. This is more than other congressional or presidential candidate except for Hillary Clinton. Clinton also took in over one hundred thousand dollars according to a Washington research group called the Center for Responsive Politics. This group tracks political giving to candidates. Senator Obama recently received the endorsement from Amy Klobuchar, a senator from Minnesota. Senator Amy Klobuchar is a superdelegate who has a vote in the Democratic convention that will be held in August. This endorsement means that Barack Obama and Hillary Clinton now have the support of thirteen senators each.