5 Housing Issues Hanging in the Balance Going Into Obama’s 2nd Term

In U.S. News & World Report, Jason Gold outlines the five housing issues that will need attention in Obama’s second term:

“Underwater homeowners, tight credit availability, and foreclosures have continued to threaten the nascent economic recovery. So when the nation’s serious housing issues were barely mentioned during election campaigning, it left many scratching their heads, especially with the battleground states of Florida, Nevada, and Arizona among the hardest hit by the housing crisis.

But even if housing was absent from serious debate this election, it will play a significant role in President Obama’s second term. With the election behind us, Americans from Wall Street to Main Street are curious how the President will address the issue that has crippled household budgets and stunted the broader economic recovery.”

Read the entire article at U.S. News & World Report.

The Real Meaning of Obamacare

Back in 1996, I wrote a book called The High-Risk Society. The book was based on the vision that Americans had to embrace risk and innovation in order to achieve faster growth and long-term prosperity.

An essential part of that vision, however, is the creation of a much stronger safety net.  If we are going to ask Americans to take risks for growth, to accept disruption in return for innovation, they have to be protected from the worst consequences of failure.

In particular, it becomes much harder to take a chance on growth if it means you might lose your healthcare. That’s why Obamacare, despite being ungainly and awkward, is an essential step towards a high-growth economy. People who want to start a new company or join an innovative new enterprise shouldn’t have to worry about whether they will be able to get healthcare. People who want to work halftime and go back to school shouldn’t have to worry about whether a sudden medical problem will throw them in the poorhouse.

Obamacare is a step towards unleashing the creative juices of Americans.  There are lots of problems, of course. We need to ensure that the new Obamacare bureaucracies don’t strangle innovative company. But now that the basic mechanisms are in place, we can move onto the more important task of empowering innovative and hardworking Americans.

This piece was cross-posted from Innovation and Growth.

Centrist Voters Back Obama

Despite Mitt Romney’s belated October dash toward the political center, moderates have lined up solidly behind President Obama. Centrist voters put Obama over the top in 2008, and they could very well do it again today.

Pew’s final campaign poll shows Obama moving from a dead heat to a three-point lead in the election’s last week. Specifically, he cut Romney’s margins among seniors (from +19 to +9) and padded his lead among women (+13 points) and moderates (+21).

Obama leads Romney 56-25 among moderate voters, close to the 60 percent he won in 2008. Because there are about twice as many conservatives as liberals in the electorate, Democrats have to claim big majorities among moderates to win elections. According to Pew, voters now identify themselves as 43 percent conservative, 32 percent moderate and 21 percent liberal, nearly identical to their ideological profile in 2008.

Although liberals consider themselves the Democratic “base,” there aren’t nearly enough of them to deliver victory. In 2008, half of Obama’s vote came from moderates, while liberals accounted for 37 percent. Republicans need fewer moderates to build majorities, which helps to explain why GOP centrists are a vanishing breed. Continue reading “Centrist Voters Back Obama”

Why the GOP Deserves to Lose

Will Marshall, in The Washington Monthly, argues why Republican Party extremism is undeserving of the American public’s support.

Whatever happens, it’s a safe bet the 2012 presidential election won’t go down in history as one for the ages. Barack Obama and Mitt Romney have bickered ad nauseum, but neither has put before voters credible plans for reviving the economy or breaking the choke hold that political polarization has on American democracy.

The choice facing voters, however, isn’t just between the two candidates. It’s also between the parties they represent. And here the choice is easier: Based on its record of political sabotage over the past four years, the Republican Party richly deserves to lose.

America could survive four years of President Romney. But a Romney victory would reward his party’s reckless embrace of ideological extremism and obstructionism. It would vindicate the GOP’s decision to abandon the political center, put partisanship before country, and cater shamelessly to the voters’ darker impulses.

Read the entire article here.

The Next Choice: A High-growth Economy Versus Long-term Stagnation

As soon as the results of the election are known, President Obama or President Romney will be beset with a list of difficult decisions: What to do about the fiscal cliff, whether to cut the federal deficit, how to implement healthcare reform or how to get rid of it,  whether or how to create jobs.

But the biggest decision facing the next president—and Americans in general—goes far beyond the ‘fiscal cliff’, or any of the machinations which fascinate Washingtonians. Should the United States follow its current path of long-term stagnation, or should we choose a road that likely leads to rapid—but disruptive—growth?

This choice will have huge and resonating consequences. In a slow-growth economy, government leaders must focus on apportioning pain and austerity. The rich and the poor within each country or region struggle over scarce resources, with predictable consequences. We are seeing the face of the stagnant future in Europe now, where country after country are being forced to absorb massive cutbacks. Slow growth means that our children will be poorer than we are. Continue reading “The Next Choice: A High-growth Economy Versus Long-term Stagnation”

Why Young People Overwhelmingly Support Obama (Hint: It’s in the Jobs.)

On Sunday Mitt Romney told an Ohio crowd that he couldn’t understand why a “college kid” would vote for Obama. He said Obama was spending all their money and that the only thing they would get from it was a bill with interest. Instead Romney promises to cut the deficit and simultaneously create an astounding 12 million jobs in his first term.

Despite his promises, young people overwhelmingly support Obama. President Obama enjoys a 19-point lead over Romney among likely young voters according to the latest polls.

Why? It’s all in the jobs. The number one concern of young voters is jobs and the economy. They need more jobs and more money. And while Romney talks a big game, his lack of details leave young people uninspired.

Meanwhile, Obama’s plan offers concrete ideas to address the economic struggles of young people, the 73 million people age 18-34. Since the recession they have lost over 3 million construction, production, and office jobs. Obama’s plan includes bringing back production jobs that may have been lost to unfair competition, while encouraging “innovation clusters” to form the next crop of high-skill, high-wage jobs. His plan increases public investment in infrastructure, boosting construction jobs in the short-term and providing a foundation for a strong economy in the long-term. His plan establishes more public-private partnerships to better match students with today’s business demands. Continue reading “Why Young People Overwhelmingly Support Obama (Hint: It’s in the Jobs.)”

Election Watch: Decision Time 2012

The big day is finally upon us, and while most signs are pointing to a very narrow popular-vote and perhaps more comfortable electoral-vote win for the president (along with small enough Democratic House and Republican Senate gains to maintain the congressional status quo), the polls and the intangibles are uncertain enough to maintain some sense of suspense.

After a week or so of favoring Romney, national polls have been slowly moving back towards Obama during the last few days. The RealClearPolitics “poll of polls” has Obama up by 0.5%; TPM’s average is at 0.7%. No major national poll—not even Rasmussen—has shown Romney with a lead going down the stretch, though the final Gallup Tracking poll (suspended last week because of the impact of Sandy on response-levels) today could change that. The final Pew survey showing Obama up by 3% is getting a lot of attention because it’s the polling firm that was the first to show a “Romney surge” after the Denver debate.

But it’s the electoral college estimates that are most favorable for Obama, reflecting polls consistently showing him ahead in Ohio, Iowa and Nevada, a combination that along with less competitive “blue states” would give him the presidency. It’s also less clear than it seemed to be last week that Romney has actually pulled ahead in Virginia and Florida, and despite a few outlier polls showing him within striking distance in Pennsylvania, Michigan and Wisconsin, the consensus is that barring some surprise turnout disparities, those states will fall to Obama as well. Nate Silver of FiveThirtyEight rates the probability of an Obama electoral college win at 85%, and Sam Wang of the Princeton Election Consortium at 98%. The conventional wisdom (though not among most Republicans!) is that Obama is in much the same position as George W. Bush was in 2004, with job approval ratings at or just above 50%, and a very small undecided vote. Continue reading “Election Watch: Decision Time 2012”

Housing Recovery: Getting Stronger or Weaker?

Recent gains in home prices in the authoritative S&P Case Shiller Index seem to confirm the growing impression that a housing recovery is underway. While the data is clear that home values are indeed rising, it is unclear, as I have pointed out previously, whether the fundamentals behind the rise (record low interest rates, investor participation, and high levels of refinancing) are sustainable.

This does not mean that prices inevitably are set for a decline. The point here simply is to warn policy makers not to take their eye off the ball. Housing markets remain weak, and there is a very real possibility of a double-dip decline in home values early next year.

A closer look at Case Shiller (CS) reveals two trends that could temper enthusiasm about recent index gains. First, the rise in home prices seems to be decreasing month to month. Second, year-over-year (Y-o-Y) increases in home values could falter as many metro regions come up on the one-year anniversary of their lowest price points. This is key since many areas have seen meaningful Y-o-Y gains and that metric has been a large part of the media, policy, and investment narrative driving the recovery. So what happens to housing markets if home price appreciation starts slowing down?

It’s an important question, because investors account for a significant share of housing demand, representing 27 percent of home purchases. Without a continued upswing in prices, they’re likely to stop buying.

DATA DIVE

Home prices rose 0.9% from July to August, 2012. While welcome, it does represent a decrease of the previous month-over-month reading from June to July 2012 of 1.6%. That number followed three consecutive decreases from 2.2% and 2.3%, respectively. Some of the hardest hit areas that have been key drivers of the home price rebound show similar, albeit erratic, signs of slowing growth over the same period:

August/July Change % June/July Change % May/June Change % April/May Change % March/April Change %
S&P CS 20 city (NSA) .9% 1.6% 2.2% 2.3% 1.4%
AZ-PHX 1.8% 2.2% 2.5% 2.7% 2.5%
FL-MIA 1.0% 2.1% 1.6% 1.4% 0.4%
NV-LAS 1.6% 0.7% 1.5% 1.9% 1.1%

Continue reading “Housing Recovery: Getting Stronger or Weaker?”

POLITICO: Foolproof victory plan for President Obama

Will Marshall explains how Obama should speak to America’s pragmatic political center in his closing argument in Politico:

The last time Barack Obama sought my political advice was, let’s see, when was it … oh yeah – never. That’s a shame, because like every D.C. pundit who never won more than a high school election, I’m sure I know exactly what he needs to do to win a second term.

So Mr. President, here it is: my foolproof if unsolicited plan for eking out a victory next month over hard-charging Mitt Romney. Its goal is to enable you to seize America’s pragmatic political center, and it has four parts:

First, stop belittling Romney on the stump. Certainly you should draw sharp contrasts with your opponent on political philosophy and policy, but it’s best to leave highly personal attacks to surrogates, campaign flacks and negative ads. There’s nothing wrong in pointing out Romney’s willingness to jettison issue positions when they no longer serve his purpose. But resorting to ridicule (“Romnesia”) or parroting the kind of contrived, focused-grouped attack lines beloved by political consultants (“wrong and reckless”), makes you sound less presidential and more narrowly partisan. Sure, adoring crowds eat this stuff up, but you’ve already got them in your pocket.

From now to Election Day, you need to speak over their heads to your real target audience — the independents, moderates and weak partisans in eight or nine swing states who will decide this election. Ignore liberals who claim that by bashing Romney you’ll excite the base and spark a big turnout. Persuasion is the name of the game now, and the voters still in play are defined by their aversion to partisan stridency.

Read the entire piece at Politico.

Election Watch: Obama and Romney Campaigns in the Final Stretch

With eleven days left before November 6, the general perception is that the presidential contest is even, though most formal prediction models continue to give Obama a slight edge and some of the more hackish Republicans continue to insist Mitt Romney is riding an endless wave of “momentum” to a landslide.

It’s unclear whether the Romney Surge in the polls that followed the first presidential debate subsided on its own, or was smothered by the vice presidential and the second and third presidential debates, all of which were generally rated as Democratic wins. And for that matter, it’s unclear if the Romney Surge was purely produced by the first debate, or was partially attributable to a natural decline in Obama’s post-convention Surge.

But it does appear that a razor-thin margin divides the two candidates in national polls of likely voters (Obama pretty much leads them all among registered voters), and that while Romney has made gains almost everywhere, he’s still trailing in Ohio, Nevada, Wisconsin and Iowa, and has probably taken the lead in North Carolina and Florida. Virginia and Colorado are too close to call. Post-first-debate measurements of “enthusiasm” that showed Republicans picking up a big advantage were as likely as catching lightning bugs in a jar; both “bases” seem very motivated, particularly in the battleground states. As for undecided voters, some polls (though not others) show Romney making impressive gains among women—presumably charmed by Moderate Mitt—and virtually all show him doing very well—perhaps over 60 percent—among white voters. The new ABC/WaPo poll that came out today, giving Romney a 50/47 lead among LVs, had Obama at 37 percent among white voters, a level lower than any Democratic presidential candidate has received since 1984. But polling in Ohio has universally shown Obama performing better there among white voters than nationally, helping explain his persistent lead in the state most observers think will decide it all (aside from his reported two-to-one lead in early voting). Indeed, the increasing possibility of a Popular Vote/Electoral Vote split in the final results, with Romney winning the former and Obama the latter, is becoming a big preoccupation of the punditry.

So the contest, it appears, will go down to late paid media, GOTV efforts, and external news events. Republicans have a significant but not overwhelming advantage in paid media; Democrats are still perceived to have an advantage in GOTV; and nobody knows how the news will cut, although presidents tend to have more leverage over the news than do former governors. Certainly no one factored Hurricane Sandy into their presidential election forecast models, representing all sorts of challenges and opportunities for Obama, and quite likely disrupting campaign activities in several states in the most crucial days before the election.

Republican hopes of taking back the Senate took yet enough hit this week as Indiana Treasurer Richard Mourdock—already locked in a closer-than-expected race with Democratic congressman Joe Donnelly—followed the path of Missouri’s Todd Akin in making offensive remarks in a public setting about rape and abortion. Mourdock has not been repudiated by national Republicans the way Akin was—indeed, Mitt Romney’s ad endorsing Mourdock is still running despite Romney’s disavowal of the hard-core-conservative Hoosier’s comments calling pregnancies resulting from rape “God’s Will.” But with polls showing significant gains by Democratic candidates in Massachusetts and Connecticut, and no signs of a GOP breakthrough elsewhere, the odds of the GOP making a net gain of three seats are not good. So even if Romney and Ryan win, they may be dealing with a Democratic Senate. This could be very discomfiting to conservatives who don’t trust Romney and assumed he would be effectively controlled by a Republican Congress. But in the heat of the final stretch of the presidential campaign, no Republican is going to breath a word about it.

All in all, between hurricanes, conflicted polling, the possibility of “split decisions” (between the popular and electoral vote, and between the presidential and Senate results), and the even stronger possibility of contested results in key states (both sides have been lawyering up heavily for election day disputes), this could be one of the wildest end-games since—well, 2000. The 2004 scenario of a very close race being decided by Ohio almost seems like a nice, placid fantasy.

CBS News: Will white men sink Obama?

Will Marshall spoke to CBS News on why white men are frustrated with President Obama and the Democratic Party:

The movement of white men away from Democrats over the past four decades, argued Progressive Policy Institute President Will Marshall, is tied to both the culture war and the perception of “a change in the focal point of Democratic economic policymaking.”

“Many white men, and many, in particular, non-college white men, have not seen that the Democratic economic agenda is in their interest,” said Marshall. “There’s an account from the left that says these voters have been estranged from Democrats on social issues. And there’s some truth to that. But I also think these voters believe the economic policies of Democrats have benefitted somebody else – not them. Women, minorities, interest groups. They don’t feel that Democrats have championed the interests of white male voters in modern times as they did in the days of Roosevelt/Truman.”

Read the article at CBS News.

Slippery Mitt Evades KO

PPI President Will Marshall questions whether Romney’s rope-a-dope strategy on foreign policy may actually work despite Obama’s superior performance in the debate in Foreign Policy:

Mitt Romney is a candidate of protean principles. When his positions on issues become inconvenient, he simply throws them overboard, sometimes even denying he took them in the first place. So it was in Monday night’s foreign policy debate, when the ferocious Rottweiler of the previous two debates unexpectedly morphed into “Me-Too Mitt.”

It was a tactically shrewd performance that made a virtue of necessity. Romney clearly hasn’t mastered the complexities of defense and security policy, and at several points last night seemed uncomfortably out of his depth. Rather than mount a vigorous challenge to Barack Obama’s conduct of U.S. foreign policy, Romney dropped previous lines of attack and wound up agreeing with the president’s handling of conflicts in Afghanistan, Syria, and even Iran.

By stressing continuity rather than radical change in U.S. foreign policy, Romney sought to reassure voters that he is ready to take over as commander in chief. Although post-debate insta-polls showed that he “lost” the debate, he probably achieved this crucial goal. And the appearance of a kinder, gentler Romney blunted Obama’s aggressive attempts to portray him as a “reckless” throwback to the bellicose policies of George W. Bush.

Read the entire article at Foreign Policy.

Will Marshall on Romney’s Mistaken Foreign Policy Ideas

PPI President Will Marshall discusses Obama’s foreign policy advantages in Politico’s Arena:

Twice Mitt Romney has tried to capitalize politically on the murder of the U.S. Ambassador and three other Americans in Libya, and twice the issue has blown up in his face. First, as the tragedy was unfolding, he rushed out a statement falsely accusing the administration of apologizing for the video that sparked violent protests in Benghazi and elsewhere. And in the last debate, moderator Candy Crowley had to correct Romney’s erroneous claim that it took President Obama weeks to call the attack an act of terrorism.

These misfires show that Romney, though surefooted when it comes to critiquing the president’s economic record, has anything but a deft touch on defense and foreign policy. The president has a golden opportunity tonight to contrast his experience and grasp of global complexities with Romney’s vague and simplistic invocations of American strength and exceptional virtue.

Lacking a global outlook of his own, Romney probably will try again tonight to make the Libya episode a parable of weak presidential leadership.  In Romney’s retro world, it’s 1979 all over again, with Obama in the role of Jimmy Carter and Libya standing in for Iran. But even as he tries to channel Ronald Reagan, Romney often sounds more like George W. Bush, especially when he claims that bold assertions of American power and leadership will bring our enemies to heel and cause the rest of the world to fall in line. To which Obama has a compelling answer: Been there, done that.

Obama’s job tonight is to expose the unreality of Romney’s glib criticisms and force him to explain what he would actually do differently if he becomes Commander in Chief. With the spotlight momentarily off the economy, it’s the president’s turn to take the offensive.

Read it at Politico

Election Watch: 18 Days to Election Day and Strong Uncertainty Remains

With just 18 days left until Election Day, and with early voting picking up all over the country, it can be said that the state of the presidential race is as hard to figure as it ever was. A paucity of big national polls with data drawn after the vice presidential and the second presidential debate has made it difficult to determine if the president got the boost (at least in Democratic enthusiasm, if not swing-voter allegiance) many analysts expected. The tracking polls have shown varying results, and the most influential, from Gallup, has shown a steady rise in support for Mitt Romney—an astonishing seven-point lead among likely voters as of yesterday—that has perhaps been complicated by the firm’s implementation of new sampling practices and a likely voter screen. Battleground-state polls are also varying significantly, but many have shown Romney gaining pretty steadily, and perhaps even taking the lead in Virginia and Florida (even as almost everyone concedes NC to him) while drawing near even in Wisconsin. Just this morning NBC/WSJ/Marist surveys from Iowa and Wisconsin (including some post-second-debate data) were released indicating that Obama had regained robust leads in those two states, but this particular polling combine has regularly given Obama better-than-average numbers.

In terms of the dynamics of the race, the second presidential debate showed an invigorated incumbent attacking Romney’s moderate credentials, while the challenger refined his “failed economy” rap and repeated it very often. Both candidates exhibited swing-state obsessions, particularly in an extended argument over energy policies that seemed to become a battle over which of them was the best bet for the fossil-fuel industries. Foreign policy made its first appearance as a major issue, though it’s unclear who got the better of the exchange over Libya; it’s difficult to imagine quite how an entire debate over foreign policy will play out next Tuesday in the final debate.  Both candidates appealed overtly to women, though again, it’s hard to determine who did better (unless Romney’s “binders of women” line migrates from the Twitterverse, where it’s everywhere, to broader venues). It’s important to remember, of course, that the final debate, strictly on foreign policy topics, is being held in just three days, so it may be very difficult to isolate reactions to individual debates.

Early voting estimates seem to indicate an Obama advantage in Iowa, Nevada, Wisconsin and perhaps Ohio, with a Romney advantage in Florida and North Carolina. A Supreme Court decision rebuffing Republican efforts to shut down Ohio voting the weekend before Election Day was very good news for Democrats, but Republican officials are managing to keep early voting hours limited.

It appears the campaigns will be roughly even in stretch-run paid advertising, despite earlier reports of a big pro-Romney advantage. But where the money is deployed is another subject, particularly with the standing of candidates in the battleground states so much in flux. And as always, assessment of GOTV efforts will be difficult to make before the November 6, though it’s assumed that Team Obama will have an advantage in most key states, but not as large as the one it enjoyed in 2008.

Down-ballot assessments haven’t changed a great deal in the last couple of weeks, though there is some Republican optimism that Romney’s improved performance could lift the entire ticket, particularly in battleground states. The one place that sort of effect could be measurably happening is in Wisconsin, where GOP Senate candidate Tommy Thompson, despite multiple major mistakes, seems to be again closing the gap with Democrat Tammy Baldwin. Observers will now be closely watching polls to see if Romney’s stronger numbers in Virginia and Florida will help George Allen break a long deadlock with Tim Kaine in the former and/or make Connie Mack competitive with Bill Nelson in the latter. Republicans desperately need a positive surprise to keep hopes of a Senate takeover alive.

Indeed, one of the more interesting subplots right now is the increased possibility that Romney could win without his party gaining control of the Senate. Most scenarios until recently, based on the early assumption that the Senate was an easy reach for the GOP, have figured otherwise. There was some debate back and forth as to whether Romney’s recent talk about “reaching out to Democrats” after the election disguised an implicit agreement with congressional Republicans to enact the Ryan Budget on a straight party-line vote using reconciliation procedures. That would become very difficult with a Democratic Senate, particularly one that will lose some of its most notable party heretics (e.g., Joe Lieberman and Ben Nelson). Expect a lot more speculation in the next few days about the extent to which Republicans might actually allow a President Romney to depart from the many very specific promises he made during the primaries.

The Astonishing Obama Tech Boom

Going into the next two debates, Barack Obama would certainly like a bit more of Bill Clinton’s mojo. After all, Clinton both won a second term and presided over the Internet-driven New Economy boom of the late 1990s, which created millions of jobs and eliminated the budget deficit. These are achievements that Obama would dearly love to duplicate.

Yet, Obama has been surprisingly unwilling to take credit for the most powerful economic success story on his watch: The astounding growth of the communications/internet sector, including smartphone makers, app developers, internet companies, and wireless providers.

Here are some figures:

• Over the past four years, the internet publishing, search and social media industry has been the top industry in job growth, with a 44% gain in domestic employment.

• Tech has beaten motor vehicles as a source of job growth. Since Obama took office in January 2009, the motor vehicles and parts industry created 94,000 jobs. By comparison, the key tech industries of software, online retailing, and internet publishing, search and social media have created 98,000 additional jobs since Obama’s inauguration. Custom computer programming–much of which involves the internet or mobile–accounts for another 91,000 new jobs over the same period.

• The so-called App Economy includes more than 500,000 jobs, up from none in 2007. These figures, based on an analysis of The Conference Board’s database of help-wanted ads, include the tech jobs that involve developing and maintaining mobile apps; the non-tech jobs that support app developers; and a conservative estimate of local spillover jobs.

• The real growth rate of gross domestic product is about a half percentage point higher than the official numbers show, once we take into account the enormous increase in data use by consumers.

Read the entire article at the Atlantic.

Photo credit: spirit of america / Shutterstock.com

Housing Summit Wrap Up

America’s stricken housing markets appear to have hit bottom, as home prices rise modestly in many areas across the nation. Now is the time to reduce government’s overwhelming dominance of home lending – Washington guarantees more 90 percent of all new home loans – but don’t expect Congress to decide the fate of mortgage giants Fannie Mae and Freddie Mac next year. And the mortgage interest deduction may be one of those tax loopholes that everyone is talking about closing, but that would deal a blow to housing markets just as they are finally showing signs of life.

Such were the main takeaways from a major, bipartisan housing conference at the National Press Club co-sponsored by the Progressive Policy Institute and the American Action Forum.

Kicked off by the Secretary of Housing and Urban Development, Shaun Donovan – with a vigorous defense of the administration’s handling of a housing market that faced historic challenges the past four years. Donovan argued, “Despite the fact that our progress has not been made in a straight line, it’s clear that housing is stronger than most expected it to be at the time when the president took office. There were challenges along the way. But today housing is in a significantly better position, by this measure, home prices, than most economists and market analysts expected at that time.”  The secretary also called on Congress to pass the broad refinance Menendez-Boxer bill. PPI has been, and continues to be a strong advocate of this proposal.

Experts sounded the alarm that that large-scale action was necessary in the next Congress, not only to decrease the size of government’s role in the housing market but to give some clarity to private capital to participate for the future. While Doug Holtz-Eakin noted that there has been some consensus building behind the scenes in Congress, he cautioned that “, Only the White House can make that step (on GSE reform). Professor Chris Mayer from Columbia Business School agreed, but pointed to the November elections, “it does matter” who is the next president because Mayer believes the two candidates have very different policies and that “FHFA becomes the place that sets de facto policy without Congressional guidance.” The panel backed Donovan’s plea to pass Menedez-Boxer, with the exception of Holtz-Eakin who said we’ve got enough housing programs.

With the nations “fiscal cliff” looming, the mortgage interest deduction set off a raucous exchange by Mark Zandi of Moody’s Analytics, who called for the housing industry to lead the way by promoting reduced limits on the $90 billion annual housing subsidy. Jerry Howard, CEO of National Association of Homebuilders, responded with a passionate defense that the industry could not weather any more hits in addition to the tsunami of upcoming regulation.