Mojo - October 2010

The Foreclosure Crisis' Widening Gyre

| Wed Oct. 6, 2010 7:55 AM PDT

[UPDATE]: Sen. Jeff Merkley (D-Ore.) has asked the Treasury and Housing and Urban Development Departments to appoint a special investigator to look at foreclosure processes at major mortgage servicers. "It is essential that completed foreclosure actions be reviewed, and that proper restitution under the law be made for every family not treated properly during the foreclosure process," Merkley wrote. Here's his letter.

[UPDATE 2]: Michigan House Democrats John Conyers and Carolyn Kilpatrick demanded today that all mortgage companies freeze foreclosures in Michigan. "Given the depth of the financial calamity in Michigan and other states, the huge number of foreclosures, and the chain reaction of problems involving foreclosures that has impacted communities and individuals, I would urge home mortgage lenders to cease their foreclosure activities," Conyers said in a statement. "Rather than spending their time running mass production foreclosure mills, the lenders should be working with individuals to keep families in their homes and restructure their loans."

The onslaught of scrutiny and criticism of the nation's top foreclosure players continues to mount. On Tuesday, House speaker Nancy Pelosi and 31 other California House Democrats asked the Justice Department, Federal Reserve, and Office of the Comptroller of the Currency, which regulates national banks, to investigate fraud by mortgage servicers, the middlemen who handle monthly payments, assess late fees, and foreclose on homeowners. "Recent reports that Ally Financial (formerly GMAC), JP Morgan, and Bank of America may have approved thousands of unwarranted foreclosures only amplify our concerns that systemic problems exist in the ways many financial institutions have dealt with homeowners who are seeking to avoid foreclosure," the letter reads. "We are particularly perplexed by this apparent pattern in light of the many incentives Congress and the Obama administration have offered to servicers and lenders to avoid foreclosures where financially viable, including subsidies and loan guarantees from taxpayers." (The delegation's letter is included at the end of this post.)

The California delegation's letter comes amidst a flurry of criticism and demands for investigations by members of Congress and state attorneys general. The whole debacle began after a leaked GMAC memo revealed the company's plans to freeze foreclosure evictions and sales of repossessed houses as the multibillion-dollar company tried to fix a "technical" problem with its foreclosure legal filings. That "technical" problem, however, wasn't so benign, it turns out: An employee in GMAC's "document execution" department (dubbed a "robo signer" by critics) had admitted to mass-signing tens of thousands of legal filings without knowing what they said, a violation of federal rules of civil procedure and casting doubt on the validity of thousands of foreclosures. Moreover, numerous other mortgage servicers used robo signers like GMAC's, bringing into question the validity of yet more foreclosures throughout the country.

Here's are the highlights since GMAC's admission, the first domino to fall:

  • Attorneys general in Connecticut, Massachusetts, Illinois, California, Iowa, Texas, and Ohio have ordered foreclosure moratoriums or investigations into questionable practices by GMAC and others
  • The AFL-CIO union last week demanded that all banks follow JPMorgan Chase's lead and freeze foreclosures nationwide
  • Freddie Mac, the government-owned housing corporation, ordered (pdf) mortgage servicers to review their foreclosure processes and root out fraudulent practices
  • Sen. Robert Menendez sent tough letters to JPMorgan Chase (pdf), Bank of America (pdf), and Ally Financial (pdf) demanding that executives at those banks to revisit potentially fraudulent foreclosures and reinstate those homeowners who were unjustly foreclosed upon. Menendez also sent a sternly worded letter to 117 different mortgage servicing companies (pdf) and demanded a Government Accountability Office investigation into "misconduct" by Ally, JPMorgan, Bank of America, and others

After years of shady practices, barreling ahead with foreclosures, and helping to sink the Obama administration's flagship homeowner relief program, it looks like the mortgage servicing industry is finally getting the scrutiny it deserves. We'll keep you updated as this debacle unfolds.

Pelosi Letter Foreclosure 100410

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Tea Party Courts GOP's Evangelical Wing

| Wed Oct. 6, 2010 4:27 AM PDT

If there were ever any doubt that the tea party movement was considering a merger with old-line social conservatives, this should probably clinch it:

The Tea Party Patriots (TPP) is an umbrella group claiming to represent more than 15 million tea party activists nationwide. It has a pretty focused set of core values: fiscal responsibility, limited government, and free markets. By design, the list doesn't say anything about abortion, gay marriage, or any other hot-button social issues. But over the weekend, TPP leaders met with members of the Council for National Policy to try to raise some money. CNP is a secretive and powerful club that has worked to make the Republican Party more socially conservative. Founded in 1981 by Tim LaHaye, the evangelical minister, political organizer, and author of the Left Behind books about the coming apocalypse, CNP's board reads like a who's who of the GOP's evangelical wing.

According to the group's 2008 IRS filings, board members include Elsa Prince, a wealthy contributor to religious right causes, particularly anti-gay marriage efforts. (She is perhaps better known as the mother of Erik Prince, the founder of Blackwater.) Joining her is the Family Research Council's Tony Perkins, Phyllis Schlafly, direct mail king Richard Viguerie, and Becky Norton Dunlop, the vice president for external relations at the conservative Heritage Foundation. By-invitation-only members of the group have included: Sarah Palin; the American Family Association's Don Wildmon; former FBI agent Gary Aldrich (now a TPP board member) who's famous for writing a book claiming that the Clintons hung sex toys on the White House Christmas tree; and former House Majority Leader Dick Armey, the chairman of FreedomWorks.

Earlier this year, the council was reportedly concerned about the rise of the tea party movement, which it viewed as insufficiently religious. Grover Norquist, head of Americans for Tax Reform, told Politico in March that he had to reassure the council members at their meeting in March that the tea party movement shared its values. Since then, the council seems to have decided to simply join the party rather than fight it.

In September, former disgraced Christian Coalition leader Ralph Reed's new Faith and Freedom Coalition convened a convention in Washington to roll out a new "get out the vote" scheme. During the two-day meeting, Bob Reccord, CNP's executive director, moderated a chummy panel discussion of tea party activists, including Tea Party Patriots national coordinators Jenny Beth Martin and Mark Meckler. Meckler, who often emphasizes that the tea party movement does not touch social issues because they are too divisive, told the audience that in fact, tea partiers were angry because of "this idea of separation of church and state. We're angry about the removal of God from the public square."

The comment suggested that at least the Tea Party Patriots weren't averse to joining the culture wars—at least if it meant tapping social conservatives' significant fundraising abilities. After the discussion, I asked Meckler whether TPP was going to be working more with Reed or evangelical Christians. He said no, but apparently the cozy relations between CNP and the tea party activists on display at the Faith and Freedom event were a sign of other things brewing behind the scenes.

At this weekend's meeting with CNP in Orange County, California, TPP leaders handed out a "secret" strategy memo that lays out an ambitious goal: to "renew the commitment to limited government and free markets in the hearts and minds of at least 60 percent of the American public over the next 40 years." Posted online by talk show host and one-time Tea Party Express chairman Mark Williams, the memo indicates that in the short term, TPP anticipates spending $675,000 in a "get out the vote" effort before the midterm election, which includes everything from house parties to GPS-driven precinct walking lists. (Most of that money presumably comes from the $1 million anonymous donation TPP received last month and announced with great fanfare.)

Down the road, though, the group anticipates needing at least $175,000 to host a summit for newly elected leaders to inoculate them against the Trent Lotts of the world who would "co-opt" innocent freshmen congressmen and turn them into the "establishment." Lots of the money TPP is seeking would go towards—what else?—more tea party-type rallies, and, more interestingly, polling to see how well the group's social media, advertising, and other outreach efforts are working. Over the next 40 years, the bill would add up to about $100 million. Clearly TPP hopes that people like Prince and other deep-pocketed members of the council will be interested in picking up the tab. 

Whether the council decided to buy into the plan is anyone's guess. Neither TPP's Jenny Beth Martin or CNP's Reccord returned calls seeking further information. But the fact that TPP was even at the meeting at all suggests that TPP's top leadership don't see a conflict in advancing their agenda with money from people who have underwritten the very culture wars that the tea party movement has long claimed to eschew.

DeMint: Gays, Women Who Have Sex Unfit to Teach

| Wed Oct. 6, 2010 3:15 AM PDT

It's hard to detach some right-wingers' concerns about gay rights or women's rights from their concerns about extramarital sex in general. Witness the recent comments of Sen. Jim DeMint (R-S.C.) on whether gays, lesbians, and unmarried women should be allowed to teach kids:

Speaking to the "Greater Freedom Rally" on Saturday at a church in Spartanburg, SC, DeMint actually advocated for fewer basic freedoms for gays and unmarried women. According the Spartanburg Herald-Journal, DeMint "said if someone is openly homosexual, they shouldn’t be teaching in the classroom and he holds the same position on an unmarried woman who’s sleeping with her boyfriend—she shouldn’t be in the classroom."

When this quote first came out, our Washington bureau chief, David Corn, emailed me to ask whether DeMint "really said this." David couldn't believe it—even of DeMint, perhaps the most conservative Senator in a very conservative GOP caucus. It's really that shocking. There's so much that's awful about this, but I especially love how DeMint's comments about restricting people's freedom to apply for the jobs they want came at a "Greater Freedom Rally."

Women's groups and Dems are pushing hard on these comments, pointing out that DeMint has handed out campaign cash to conservative candidates across the country. DeMint's comments are outrageous enough that they might encourage people who wouldn't otherwise vote to get to the polls. They'll also presumably help the DNC raise some money. But they probably won't change many people's votes—unmarried women, gays, and lesbians are already a pretty Democratic demographic. DeMint won't really pay. The GOP will still have a great November, and he'll still win overwhelmingly. What a jerk.

We're Still at War: Photo of the Day for October 6, 2010

Wed Oct. 6, 2010 2:30 AM PDT

U.S. Army 1st Lt. Dan Chapman, a platoon leader with Headquarters and Headquarters Company, 1st Battalion, 14th Infantry, “Golden Dragons” 2nd Advise and Assist Brigade, 25th Infantry Division out of Schofield Barracks, Hawaii, pulls security during a cordon and search, in the Rashaad Valley near Kirkuk, Iraq, Sept. 25. Photo via. U.S. Army.

Corn on "Hardball": Christine O'Donnell Not a Witch

Tue Oct. 5, 2010 5:37 PM PDT

David Corn and Pat Buchanan joined Chris Matthews on MSNBC's Hardball to discuss (heatedly) the latest ad from Christine O'Donnell and recap recent developments in the Connecticut and New York Senate races.

 David Corn is Mother Jones' Washington bureau chief. For more of his stories, click here. He's also on Twitter.

Is Jon Stewart's DC Rally Good for GOPers?

| Tue Oct. 5, 2010 9:25 AM PDT

In his latest PoliticsDaily.com column, David Corn ponders whether Jon Stewart's Rally To Restore Sanity might turn out to be a distraction that is beneficial to the Republicans. He writes:

Stewart is a comic genius and one of the most sharp-eyed political satirists and news media critics in decades. (Ditto, ditto, and ditto for Colbert) If Stewart can draw 200,000-plus people to D.C. (with or without Colbert), this will be a significant cultural moment. ("Think of our event as Woodstock, but with the nudity and drugs replaced by respectful disagreement," the march's call says.) It will further twist, blur, or emulsify the lines that supposedly distinguish real media from faux media, and real politics from for-show politics. ("America Is a Joke," was the title of a recent New York magazine profile of Stewart.) But though Stewart's rally could end up a valuable moment by presenting a potent counter to Beckism, let me suggest another concurrent possibility: It could be useful for Republicans. 

Stewartpalooza is happening the weekend before the critical congressional elections. It will suck up plenty of media attention—and resources. Think of all the people who will be coming—and the time and money it will take them to plan the trip and to travel to and from the nation's capital. These folks are likely to be more sympathetic to Democrats than Republicans, despite Stewart's skewer-'em-all approach. So if the pro-sanity crowd is packing bags and heading to Washington on the last weekend prior to the elections, these people won't be knocking on doors or making phone calls to get out the vote for Democratic candidates.

Certainly, if many of moderate-as-hell demonstrators hail from congressional districts where the Democratic candidates are likely to win (say, anywhere in Manhattan), there's no real harm done. But if Stewart draws bodies from toss-up districts—and provides an outlet for citizens who might otherwise be persuaded to do grassroots political work at home—Republican strategists will be delighted. Moreover, one can expect President Obama to be barnstorming that last weekend and promoting a forceful case against the Republicans. Stewartstock will compete for precious media time with the president. And what will the rally's overall message be? Something like "Enough already"? As much as that might resonate with many Americans, such a call might not do much to motivate voters to hit the polls the following Tuesday. Stewart obviously is a progressive-minded fellow, but how far can he go in pushing a message—after all, this is comedy, right?—that helps the Democrats at the last minute?

Corn notes that Stewart's rally is similar to Stephen Colbert's recent appearance as a congressional witness:

When Colbert testified before Congress recently, he was masterful—as a postmodern (or post-O'Reilly) reality-curving humorist. His appearance was a rather sophisticated send-up of American politics. At the same time, he attempted to register a sincere point about the plight of immigrant workers. Ultimately, Colbert the comic ended up competing with Colbert the advocate. Yes, he did bring attention to a subcommittee hearing that was otherwise destined for no notice. But that attention focused on whether Colbert as "Colbert" had brought the right sort of attention to the hearing. 

The dynamics of the Stewart/Colbert rallies could be similar. With this event, Stewart is using satire to advance a serious case, but he has to play it for laughs. Come the end of October, the Democrats will be doing everything they can to hold on to the House and beat back an anti-incumbent surge beneficial to the Republicans. Anything that distracts or gets in the way could hamper that effort. And the Republicans end up laughing the most.

Still, Corn invites all the attendees of the Stewart rally over to his house for coffee and cake once the event is done. 

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Another Terrorist Turns Out Not To Have Superpowers

| Tue Oct. 5, 2010 9:01 AM PDT

In federal court in Manhattan Tuesday morning, Times Square bomber Faisal Shahzad was sentenced to life in prison. Like every other one of the over 350 terrorists in US prisons, Shahzad, in the end, turned out not to have superpowers. Like Ahmed Khalfan Ghailani, who went on trial in New York this week, he had neither super-strength nor X-ray vision. The federal prison system was completely capable of holding him. The FBI was completely capable of interrogating him without turning to waterboarding or stress positions or beating the crap out of him. He sang like a bird. And the federal court system was completely capable of sending his sorry ass to prison, where he belongs. 

Meanwhile, as Ghailani, who's supposedly a big scary terrorist, is being tried in federal court near (gasp!) Ground Zero (and the "Ground Zero mosque"), people seem to be carrying on about their business:

Look: these terrorists are morons. Murderous, cowardly morons, but morons nonetheless. They are not going to achieve their agenda by slaughtering people. Just as Terry Nichols was not going to bring down the US government by murdering a bunch of children in Oklahoma City, Khalid Sheikh Mohamed didn't magically re-establish the Caliphate by murdering 3,000 Americans in lower Manhattan. If we can put Nichols on trial, if we can put Ghailani on trial, if we can put the blind sheikh and Zacarias Moussaoui and Richard Reid and the Unabomber and the DC sniper and the brain-eater guy on trial and lock them up in Florence for the rest of their lives, we can do the same thing to KSM and his buddies. These guys are not friggin Magneto!

 

Expect Fewer Women in Congress Next Year

| Tue Oct. 5, 2010 8:10 AM PDT

Despite the hullabaloo surrounding Sarah Palin's "Mama Grizzlies," the number of women actually holding office in the next Congress is likely to decline for the first time since 1978.

Why? USA Today explains that's it's mostly because of two factors: 1) women in Congress are disproportionately Democratic, and it's a tough year for Democrats; 2) the economy is still faltering, and women are generally seen as weaker on economic issues. "They don't want to take risks in a bad economy, and they perceive women as being riskier," says Democratic pollster Celinda Lake. As a result, USA Today concludes, "Independent analysts predict that the number of women in Congress—currently 56 Democrats and 17 Republicans in the House, and 13 Democrats and four Republicans in the Senate—will decline for the first time in three decades." One poll tracker for the Cook Political Report estimates a drop of five to 10 women in the House and that the number of women in the Senate will either drop slightly or stay the same. 

It's easy to overlook this reality given the amount of attention that female Republican candidates have attracted. But while more Republican women are running for office than ever—leading the National Republican Congressional Committee to label 2010 "the Year of the Republican Woman"—fewer are making it past their primaries: "A record 128 Republican women filed to run for the House, according to the Center for American Women and Politics at Rutgers University, although fewer went on to win GOP primaries than in 2004."

So though Palin may be helping to inspire more conservative women to run than ever, that doesn't necessarily translate to more women in office. In the end, Palin didn't make it there, either.

DC Ticker on ABC News: Burton, Buy; Sessions, Sell

| Tue Oct. 5, 2010 6:56 AM PDT

For some time, I've had a mostly daily feature on my Twitter feed called DC Ticker, in which I issue buy or sell orders for various political and policy players. It's amusing (I hope) shorthand for who's trending up or down, according to the news of the moment. I keep the assessment non-ideological. Some Twitter followers were irritated recently when I issued a buy order for Karl Rove, but this rating was based on the increasing influence of the billionaire-funded super-PAC he has put together to exploit the Citizens United decision and assist GOP candidates in the 2010 congressional campaigns.

Now, DC Ticker is expanding. ABC News White House correspondent Jake Tapper is starting a weekly digital show today. It's called Political Punch, which happens to be the name of his rather good blog. Each edition of the PP show will include a DC Ticker report from me. Part of the fun so far in compiling the DC Ticker has been in not explaining the picks. Often, the reasoning is obvious (if you pay attention to political developments). But not always. Occasionally, if enough people ask, I might offer an explanation. But there's no guarantee. The producers of Tapper's new show, though, have requested transparency for DC Ticker. So here's a brief run-down of the choices and the whys.

* Bill Burton, buy. Lots of chatter of late about White House press secretary Robert Gibbs leaving his post for another White House gig or to head the Democratic National Committee. Burton, the assistant press secretary, is in line to take Gibb's place at the podium (though there are others presumably in contention).

Rep. Pete Sessions, sell. He heads the Republican Congressional Campaign Committee. With a flurry of articles saying, well, the Democrats just may be able to hold on to the House majority, his stock is slipping.

John McCain, sell. A New Yorker piece contained a telling nugget: McCain dressing down Sen. Lindsey Graham, a fellow Republican, for trying to steal McCain's "maverick" label. High school, anyone?

Anthony Kennedy, buy. Yeah, yeah, yeah, there's a new Supreme Court Justice named Elena Kagan, and she is a she. But as the court opens its term this week, Kennedy remains the main swinger on this bench.

Jon Stewart, buy. At the start of this week, nearly 200,000 people had declared on Facebook that they will attend his Rally To Restore Sanity on October 30 in Washington, DC. Whether this event is serious or a stunt, Stewart wins: he'll get plenty of media attention this month and, best of all, a ratings hike. (For my quasi-serious take on Stewartpalooza, see here.)

You can receive my almost-daily DC Ticker report by following my Twitter feed. (#DCticker is the Twitter hashtag.) Please feel free to argue with my selections—though all decisions of the judges are final. And please feel free to make suggestions for buy or sell orders in the comments below or on Twitter (by replying to @DavidCornDC). And there's this: DC Ticker is merely an advisory service. It and its author cannot be held liable for any investments made in politicians, policy wonks, or government officials on the basis of the information presented.  

Pay Attention to Pat Toomey!

| Tue Oct. 5, 2010 3:15 AM PDT

The media love to cover radical and somewhat wacky candidates like Carl Paladino, Christine O'Donnell, Sharron Angle, and Rand Paul. But lost in all that finger-pointing is the fact that in Pennsylvania, a Senate candidate who in any other year would be among the most conservative in the country is on a glide path to take Arlen Specter's old seat. Pat Toomey, a former congressman and longtime president of the far-right "Club for Growth," has led Dem Rep. Joe Sestak in the polls for months. And despite some apparent tightening in recent weeks, polling guru Nate Silver gives Toomey an incredible 92 percent chance of winning the race.

Christine O'Donnell will almost certainly not be in the Senate in January. Carl Paladino probably won't be governor of New York. And Silver gives Toomey a better chance of winning that either Angle or Paul. Yet Toomey's radicalism has received relatively little national attention. Make no mistake: Toomey is incredibly conservative. A Pollster.com analysis of Toomey's votes in the House of Representatives found that he was more conservative than 97.9 percent of all members of Congress (House and Senate) since 1995. Using DW-Nominate scores, a common measure of liberalism or conservatism, Pollster's Harry Enten found that Toomey would be the second-most conservative Senator in the current US Senate—to the right of Jim DeMint and behind only Oklahoma's Tom Coburn. Yet this is a man who is leading dramatically in the polls in a state that has voted for every Democratic presidential candidate since 1992—and went for Obama by 10 percent. 

Considering that Pennsylvania is heavily unionized—it has a higher percentage of union members than all but 13 other states—Toomey's virulently anti-labor record is particularly notable. Arlen Specter, the Republican whom Toomey primaried in 2004 (and chased out of the Democratic party in 2009), tried to cultivate a reputation as a friend of the unions over his nearly three decades as a GOP Senator. Toomey has made no such efforts. He has a lifetime 7 percent voting record from the AFL-CIO.

The rest of Toomey's record is just as conservative. While Toomey was running the Club for Growth, the conservative group spent $10 million pushing George W. Bush's unpopular, failed plan to privatize Social Security so that people could gamble their Social Security money in the stock market. He also supported reducing the tax rates for corporations—including Wall Street banks—to zero. And as a member of Congress, Toomey pushed hard for financial deregulation—especially of the derivatives products that he used to trade. More on that in my story today. Check it out.