The Republican response to the mortgage crisis has been, shall we say, a bit of a joke. John McCain has led the way for the party with a plan that is both ineffective and surprisingly callous.
The real core of his speech was his argument against government action to help dig distressed homeowners — or the country — out of the mortgage mess…. His suggestion that federal aid might wrongly reward “undeserving” homeowners sounded both mean-spirited and economically naive. And then there is the double standard. He seemed less concerned about the government helping reckless bankers, endorsing its role in preventing the bankruptcy of Bear Stearns.
No one has ever proposed helping real estate speculators. And the senator’s language obscures the reality that most troubled homeowners did not get into trouble by themselves. Lenders, aided and abetted by bankers and do-nothing regulators, lured many borrowers into overly complex, ultimately unaffordable loans. Mr. McCain also failed to grasp that the foreclosure problem has gone far beyond the issue of the deserving and undeserving. What is on the line now is the health of the economy, including the viability of the financial system: Helping troubled borrowers stay in their homes would help the banks by reducing defaults and foreclosures.
The question now is not whether the government should intervene, but how.
As it turns out, the Republican Party line on the crisis is very much in line with its presidential candidate. That wouldn’t be especially noteworthy, except GOP lawmakers are talking to their constituents, who, interestingly enough, don’t much care for the party’s do-nothing-and-see-what-happens approach to the problem.
“The government should help,” said Mr. Carpio, 57, a former truck driver whose wife is a security guard. “Somebody ought to do something.”
In Mr. Carpio’s view, that somebody could be Representative Lincoln Diaz-Balart, an eight-term Republican who represents Hialeah and whose district slices through Miami-Dade into Broward, two counties in the top 10 of foreclosures nationwide.
But as Congress returns from a two-week recess on Monday for a furious debate over whether to help homeowners on the brink of default, Mr. Diaz-Balart is caught in a crunch of his own.
On one side, Democrats emboldened by the Federal Reserve’s intervention in the collapse of Bear Stearns are demanding help for “everyday Americans.” On the other, Republicans including Senator John McCain, the party’s presumptive nominee, are urging restraint, reluctant to commit taxpayer funds to what they say is simply a bailout for greedy lenders and reckless buyers.
It is a bind shared by other Republicans, especially from high-foreclosure states like Arizona, California, Michigan, Nevada and Ohio. The Democratic Congressional Campaign Committee has a list of 18 districts where it plans to highlight high foreclosure rates in its effort to oust Republican incumbents this year.
Hmm, Republican policies about doing nothing, all in the name of limited government, apparently isn’t a big selling point to voters who are losing their homes in a nationwide mortgage crisis. Who would have guessed?
So Mr. Diaz-Balart is treading carefully even as some of his constituents angrily insist that he should be leading the charge for help on Capitol Hill. He says he is open to some of the Democrats’ ideas but has not decided how he will vote on a proposed $300 billion loan guarantee program to prevent foreclosures and an array of other housing initiatives expected on the House floor in the next few weeks.
“I haven’t studied this sufficiently to commit right now,” Mr. Diaz-Balart said in an interview outside Epworth Village, a retirement community where he spoke to constituents about how to get their payments from the economic stimulus plan approved by Congress last month.
“It’s a very serious problem, and I am not dogmatic,” he said. “I am not going to say there cannot be state intervention in a dogmatic way.”
For constituents like Mr. Carpio, that is not enough. “I’m very lukewarm about him nowadays,” said Mr. Carpio, who like his congressman is a lifelong Republican of Cuban heritage.
Others were less subtle. “He says a lot of about foreign policy, mainly toward Cuba, which makes no difference here,” said David Carbonell, a former computer programmer and gas station manager now on disability with a heart ailment. “You have people living here at the edge of poverty and he has done nothing to bring anything back to Hialeah or Miami Lakes. He is a party hack. He will vote the way his party votes.”
Toe the party line and embrace conservative orthodoxy, or help constituents who are hurting in the midst of a mortgage meltdown. It can’t be easy to be a congressional Republican right now.