All of this evidence was presented at a hearing of the House Government Oversight and Reform Committee on Wednesday.
The NBC Nightly News covered the shocking information without once uttering the words “President Obama” in connection with the documented failures. Anchor Brian Williams said the inspector general had concluded that “the government’s effort to help Americans save their homes” was a failure.
The government? This is “The Obama HAMP,” as noted by one private company Web site promoting the government program.
The Web site promises: “The funds the Obama Administration has made available for this program come from YOUR tax dollars. Take advantage of this program while it is still available! You will be able to lower your rate as low as 2%, obtain a fixed lower monthly payment, and save your home from foreclosure.”
Get your “Obama loan modifications,” promised another non-government Web site.
But the Inspector General report finds that this Obama program’s failure to preserve homeownership has had perhaps “the most devastating consequences.” It said the HAMP “has been beset by problems from the outset and, despite frequent retooling, continues to fall dramatically short of any meaningful standard of success.”
The report that followed on the NBC Nightly News by Lisa Myers noted that one person who was supposed to be helped by the program ended up facing foreclosure anyway. Obama officials had said the program would help 3-4 million people, but the number of “mortgage modifications” now stands at only 522,000. It is not clear how many of those people supposedly benefiting from HAMP through reduced mortgage payments subsidized by the taxpayers will actually end up facing foreclosure in the long run.
So the taxpayers will lose even more money and the homeowners will lose their homes. This is a lose-lose program guaranteed to create even more of an economic and financial crisis.
The Inspector General report notes, “HAMP’s failure to have a material impact on the foreclosure crisis has many causes, starting with a rushed launch based on inadequate analysis and without fully developed rules, which has required frequent changes to program guidelines and caused unnecessary confusion and delay. Perhaps most fundamentally, Treasury has steadfastly refused to adopt meaningful goals and benchmarks...”
While Myers did note that “the Obama Administration official managing the program calls it a success,” an incredible statement considering the evidence presented in her own report, there was no effort on the part of the NBC Nightly News or other liberal media to contrast Obama’s optimistic or “Reaganesque” tone during the State of the Union with the actual facts on the ground and the evidence of his policy failures.
In terms of the broader economic and financial picture, Neil Barofsky, the special inspector general for the Troubled Asset Relief Program, said that while TARP saved some big firms from failure, the government actions “encouraged future high-risk behavior by insulating the risk-takers who had profited so greatly in the run-up to the crisis from the consequences of failure, and gave an unwarranted competitive advantage, in the form of enhanced credit ratings and access to cheaper credit and capital, to institutions perceived by the market as having an implicit Government guarantee.”
“In many ways,” Barofsky said, “TARP has thus helped mix the same toxic cocktail of implicit guarantees and distorted incentives that led to disastrous consequences for the Government-sponsored enterprises (GSEs) — the Federal National Mortgage Association (‘Fannie Mae’) and the Federal Home Loan Mortgage Corporation (‘Freddie Mac’).”
So the bailouts that were started by Bush and continued under Obama run the risk of generating even more bailouts in the future.