Editore"s Note
Tilting at Windmills

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December 4, 2007
By: Kevin Drum

HUCKABEE SURGING....According to the LA Times, Mike Huckabee's newfound success goes beyond just Iowa. Nationally, he's climbed into second place:

Mike Huckabee, the ascendant Republican presidential candidate in Iowa, is enjoying a surge of support across the country — and Rudolph W. Giuliani seems to be paying the biggest price, a new Los Angeles Times/Bloomberg poll has found.

....In the Times/Bloomberg poll, Huckabee was preferred by 17% of likely GOP voters — up from 7% in a similar October survey. Support for Giuliani, the former New York mayor who once enjoyed a commanding lead in national polls, slid 9 percentage points over the last two months — to 23%.

On the Democratic side, things have stayed about the same since the last Times/Bloomberg poll: 45% for Clinton, 21% for Obama, and 11% for Edwards.

In other news from the poll, 71% of respondents think it's likely we're headed for a recession next year, compared to 65% who thought so a couple of months ago. I'll go with the crowd on that one. And 58% think the government should force subprime lenders to freeze interest rates in order to help borrowers who are in danger of default. I'm actually not sure what I think about that, but it certainly seems like an opening for some enterprising presidential candidate to take advantage of. How can you go wrong running against shifty subprime mortgage lenders?

Kevin Drum 7:28 PM Permalink | Trackbacks | Comments (32)

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http://www.cbsnews.com/stories/2007/12/03/politics/main3569614.shtml

Stuff happens.

Posted by: Joshua Norton on December 4, 2007 at 7:41 PM | PERMALINK

On the mortgage rate freeze, I highly recommend heading over Calculated Risk for a thorough discussion of it. The majority opinion over there is that it depends upon exactly what is meant by this, and other, ideas being floated out there. It's definitely a "devil's in the details" situation.

Posted by: J. Michael Neal on December 4, 2007 at 7:53 PM | PERMALINK

k. Mike doesn't believe in evolution. That's just a tad worrisome.

And he thinks Jesus would be pro death penalty because he didn't ask for clemency on the cross.

mmk. No evolution. Jesus, pro death penalty. Seems like he's kind of frayed on both ends, no?

Posted by: Trypticon on December 4, 2007 at 7:56 PM | PERMALINK

How about a freeze while the mortgages are being analyzed?
All that would be needed would be the name of the borrower, how much they borrowed from whom and at what interest rate. Then pass that information to a review board that would evaluate the claimant's assets (income, etc), just as if the loan was being made today. If the borrower has the ability to repay the loan at the present interest rate, but not a higher one, then the present rate would continue. The rates could be adjusted upwards slightly, if the borrower has the ability to meet an increased payment.
This would ensure that those who are currently able to meet their mortgages would continue paying, those who can manage an increase in their payment (although not necessarily as much as originally written) would continue paying and those who can't even meet their present payments would be the only ones defaulting. Perhaps there could be some sort of referral system for the last group to allow them a chance at refinancing.
There would still be a lot of "losses" for the oriinal investors in that they wouldn't be getting the increased interest payments, however, in most cases, they would at least be getting repaid.
And it should be realized that any rescue attempt is not aimed at protecting any borrower; it is aimed at protecting the U.S. economy from what could happen if those loans are sent into default.

Posted by: Doug on December 4, 2007 at 8:06 PM | PERMALINK

The higher Huckabee climbs in the polls, the more interesting it's going to be. I'm waiting for the "Willie Horton" moment when someone manages to get the press to really look at the circumstances of Huckabee's pardon of serial killer Wayne Dumond. Tristero has the details:

http://digbysblog.blogspot.com/2007/10/these-are-ny-times-that-try-mens-souls.html

I'm also waiting for people to wake up to the fact that Huckabee is committed to shoving national science policy even farther under the wheels of the bus than Bush has. How long would it take Huckabee to declare Intelligent Design the only permissible doctrine for life science policies?

I swear the press is trying to make the Democratic race nothing more than a beauty contest while treating the GOP freak show as the triumph of 200+ years of American political thought.

I realize it takes a huge sense of irony to say this, but God help us all.

Posted by: xaxnar on December 4, 2007 at 8:08 PM | PERMALINK

From another thread:

The average science score of U.S. 15-year-olds lagged that of students in 16 of 30 [industrialized] countries....

And Huckabee doesn't understand why people are concerned about whether he believes if creationism should be taught in public schools.

Posted by: AJ on December 4, 2007 at 8:12 PM | PERMALINK

Wow--that murder story is something. Lets all sit back for a moment and imagine if the story was a bit different and Bill had paroled this guy. What headline would Drudge have written?

Posted by: Bush Lover on December 4, 2007 at 8:17 PM | PERMALINK

huckabee is the new fred thompson, the candidate du jour because a) the other candidates suck and b) no one's looked at him closely because previously he's been irrelevant in the polls. i will give him this much: unlike some other gop candidates, at least he doesn't believe he himself is god...

Posted by: mudwall jackson on December 4, 2007 at 8:27 PM | PERMALINK

Freeze the rates but at the same time, extend the term to 40 years vs 25 or 30 years, ie. force the mortgagee to pay more but at a lower rate over an extended period of time. That way the mortgage will not be subsidized.

Posted by: Dilbert on December 4, 2007 at 9:02 PM | PERMALINK

Desperate Republicans buying a pig in a poke. What else is new?

Posted by: david on December 4, 2007 at 9:08 PM | PERMALINK

"Freeze the rates but at the same time, extend the term to 40 years vs 25 or 30 years, ie. force the mortgagee to pay more but at a lower rate over an extended period of time. That way the mortgage will not be subsidized."
Posted by: Dilbert on December 4, 2007 at 9:02 PM

It's a tough situation to judge from the sidelines. There are many people living in their single home and then there are apparently quite a few speculators. How do you decide which deserve favorable treatment and which should be thrown under the bus? Also, forcing lenders to continue the interest-only deals could be serious pain for them. Some kind of compromise, such as Dilbert suggest, makes a lot of sense -- especially for those mortgages to people who are actually living in the home and it's their only house.

Still, trying to provide a cookie-cutter solution isn't going to be perfect and some people are still going to be hurt, both home 'owner' and lender.

Posted by: MarkH on December 4, 2007 at 9:28 PM | PERMALINK

Freeze low interest rates for subprime borrowers? Sure, why not? Consider them frozen.

While we are at it, we are also pushing the price of gas to $1 a gallon, of credit card rates to 2% etc etc.

It is not like we have a free market and borrowers have to be careful not to get into high risk situations.

We don't have a freaking free market and idiots will continue to be saved for their greed by politicians who want their votes. This is what politicians do in so called "third world countries." Give away free stuff and subsidies to voters to win their votes. So we are not only NOT a free market society, we are also lowering our elections standards to those of those "third world countries." I thought the 2000 appointment of a "President" by the said President's dad's handpicked Supreme Court justices was an isolated case. No, we are degenerating into a banana republic where elections are a sham and the economy is rigged to reward high risk gamblers (subprime lenders AND borrowers).

Gotta go continue working. Uncle Sam expects me to fill his treasury so he can dole it out to idiots who should have known better.

Posted by: rational on December 4, 2007 at 9:39 PM | PERMALINK

It is INSANE to freeze the rates for people with adjustable mortgages.

I had a mortgage at Prime less 2.5% for the first two years and then it adjusted to Prime less .5%.

I knew rates would go up. I also knew I was going to pay down a huge chunk during the first two years.

It would be insane to freeze my rate and not let the rate jump.

I knew what I was doing and I have perfect credit. I also have, make that had, 50% equity in house. I think I have more than that now but I am really clueless as to what the house is now worth.

We need to figure out ways to keep people in houses who can afford to stay there. However, you can't let someone stay in a house at interest only payments at 5%. Some people have too much debt and need to move because they can't pay. Government shouldn't give huge benefits to people who made bad bets. Government should help the people who can benefit from the help. It shouldn't tax one guy making $50,000 a year to support someone living ina huge house making $65,000.

Posted by: neil wilson on December 4, 2007 at 9:51 PM | PERMALINK

rational, significant factors in this situation are misleading and fraudulent sales practices and irresponsible underwriting. I believe those cases merit intervention.

Posted by: david on December 4, 2007 at 9:53 PM | PERMALINK

JUST SAY NO!!!

The key word is "shifty" mortgage lenders. If the shifties agree to anything, you know a government bailout is in the works.

I hate to be a cold blooded Republican, but the idiots took out the mortgages, let them figure out how to get their lives back in order. Likewise, the shifties need to pay their bills, too. If they go out of business, too bad, that is what happens to bad business people.

Those of us that have led responsible lives don't need to bail out the hucksters and the fools, again.

Posted by: just say no on December 4, 2007 at 9:54 PM | PERMALINK

david, agreed. Lenders were eager to shove loans down the throats of clueless borrowers and they made aggressive sales pitches. Let THEM and their investors pay for this mess. Assuming, the written paper work signed by borrowers was misleading. If it spelled out the terms in clear, unambiguous terms but borrowers, in their hurry to go refinance their home, didn't bother to read the papers before they signed them, then it is their fault.

In either case, it is between the lender and the borrower. If one or both of them lied to seal the loan, let the courts figure it out and punish the liar. Why should I, a tax payer who decided to buy only enough house I could afford to pay, bail out either of them?

Posted by: rational on December 4, 2007 at 10:11 PM | PERMALINK

Kevin, when you talk of "freezing subprime ARMs", what do you mean exactly? I ask, because a lot of ARMs (mine included) just went DOWN in interest rate resets this year, and will go down 1/2-1% AGAIN next year. What are you trying to do, screw people out of their deserved ARM rate DECREASE?

Posted by: Doc at the Radar Station on December 4, 2007 at 10:35 PM | PERMALINK

Re Huckabee, Not sure an ordained Baptist should be president, but I do like the way he calls the "Club for Growth" the "Club for Greed".

Posted by: fafner1 on December 4, 2007 at 10:42 PM | PERMALINK

Don't forget that the original "shifty subprime lender" is likely not to be the current receiver of the mortgage payments.

Posted by: g on December 4, 2007 at 10:58 PM | PERMALINK

What I'd like to know, Kevin, is why you think a man who thinks Genesis is a better explanation for the origin of species than the theory of Evolution would make a good candidate for president in the 21st century.

Haven't we had enough of sweet talking Arkansas governors?

Posted by: DBL on December 4, 2007 at 11:27 PM | PERMALINK

Original shifty subprime lender may not be the current receiver of the mortgage, but when the current receiver bought the mortgage (or derivative of the original mortgage) they assumed the risk. It was their responsibility to make sure that the mortgage they were buying was priced based on inherent risk. They assumed the risk. NOT the taxpayer.

Posted by: rational on December 5, 2007 at 12:03 AM | PERMALINK

Nobody with character is running, so as candidates rise to the top we find out more about disgusting things about them and bring another one up.

Posted by: Luther on December 5, 2007 at 12:51 AM | PERMALINK

Sorry, but the planet can't afford another science-hater. Also, that serial-killer thing? The more you dig into it, the worse Huckabee looks. And he didn't seem that great to begin with!

Posted by: Kenji on December 5, 2007 at 1:14 AM | PERMALINK

I recently saw the movie Idiocracy on cable. It goes a long way to explain the current crop of Republican candidates.

The story of Huckabee paroling the serial rapist is disgusting. It is not that he made a bad judgement call. He as bowing to pressure from the Clinton-haters. They just knew the accused rapist was innocent because the victim was distantly related to Clinton. Huckabee had private communications from women raped by this guy and still he lobbied for his pardon.

Posted by: JohnK on December 5, 2007 at 4:44 AM | PERMALINK

Haven't we had enough of sweet talking Arkansas governors?

What was wrong with the first one again? Oh right, all that peace and prosperity.

Posted by: ckelly on December 5, 2007 at 10:28 AM | PERMALINK

Rather than a rate freeze, which has numerous problems discussed above (screws people out of potential decreases in rates; if it is beneficial at all, also rewards speculators and those not facing real hardship), why don't we instead narrowly focus the help where it is needed:

Define objective criteria (based on interest rate and other features of the loan and borrower's circumstance) that, if a loan for a property used as a primary residence at the time of and for a set period before filing meets, it is dischargeable in bankruptcy (unlike a normal secured loan) but replaced with a special lien on the property that can be satisfied by payment of the unpaid principal of the loan, must be satisfied before transfer of the property, and does not grant the holder the right to take possession of the property unless the owner dies and the estate is unable or unwilling to satisfy the lien.

This provides an incentive for lenders whose borrowers may be facing hardship to offer better terms, and provides relief for those who really need it if the lenders fail, but doesn't compel people to give up the potential benefits of ARMs, doesn't reward speculators or those who aren't facing hardship, and doesn't send the message that you don't have to pay attention to your loan terms, because the government's going to bail you out without consequence if you get a bad deal.

Posted by: cmdicely on December 5, 2007 at 10:46 AM | PERMALINK

re Mike Huckabee it's a hell of a day when he seems to be one of the two Not Insane candidates on the Republican side. What amazes some of us down here in Arkansas is that his thin-skinned snide side hasn't popped up in one of those debates; he can be petty and vindicative, but he's kept it under control. What national audiences are seeing for the most part is "good Mike"--who as governor was in some intances and on some issues (including funding for education)much more progressive than many of his co-Republicans.

Posted by: dware on December 5, 2007 at 11:18 AM | PERMALINK

Head on over to Huffingtonpost for the latest on the Dumond story. Huck played a major role in getting Dumond out of prison and has actively worked to cover it up. One of his ex-aides has made public the letters from Dumonds victims that Huck received that warned him that Dumond would probably rape again and might not leave a witness the next time. Huck has been covering this up ever since then, claiming that noone could have guessed that Dumond would do such a horrible thing. When asked the subject of the closed door meeting Huck had with the parole board just before Dumond was paroled, Huck says he doesn't remember.

Yet another Republican with a bad memory!

Posted by: Sceptic on December 5, 2007 at 12:00 PM | PERMALINK

They didn't do it and they can't remember. And yet they keep doing things to us that we remember too well. How do these douches keep getting elected/appointed/selected/purchased etc.?

Is it Greek tragedy or comedy? Euripides, you payfides.

Posted by: Kenji on December 5, 2007 at 12:30 PM | PERMALINK

Really, if you look at all the details of Huckabee's pardon of the rapist Dumond, I just don't see how his candidacy can survive real exposure of those events. Huckabee comes out as an unbelievably callous and cynical politician, a bully, and a liar.

It makes the Willie Horton case seem like a wet kiss. Willie Horton had only the most tenuous connection to Michael Dukakis. But the release of Dumond could not be more directly connected to Huckabee's actions, and political and religious biases and connections. The case will absolutely undermine his attempt to portray himself as a normal, "non-political" guy with decent, down home values.

Posted by: frankly0 on December 5, 2007 at 1:17 PM | PERMALINK

Surging? How about “searching”? Huckabee is searching for cover now that the real Huckabee is emerging. Ignorant about the NIR on Iran, Wayne Dumond case, Ethics violations while governor of Arkansas, etc., etc., ...so much for the so-called “Christian Leader”. He can quote the Bible verbatim anytime but unaware of issues of national importance - I know exactly what he’s going to do in the White House - Sunday School and Bible Study!

Posted by: tim on December 5, 2007 at 1:19 PM | PERMALINK

I refinanced my loan a couple of years ago (it was small amount) and I actually read the contract and asked questions, to the amazement of the bankers. No one in their memory had ever done so. They had to check the meaning of some of the provisons, themselves.

Posted by: rollingmyeyes on December 5, 2007 at 9:49 PM | PERMALINK




 

 

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