Category: Fall 2008 Newswire
McCain Campaign is Moving to Maine
CAMPAIGN
Bangor Daily News
Maite Jullian
Boston University Washington News Service
10/02/08
WASHINGTON –John McCain’s campaign announced Thursday that it will move resources and staff to Maine to challenge Barack Obama in the Democrat-leaning state.
“We are opening up an aggressive front in Maine, where we have strong numbers and where they split their electoral votes,” Mike DuHaime, political director of the campaign, said in a conference call.
Maine, which has four electoral votes, splits those votes by districts. Nebraska is the only other state in that situation.
The announcement came as the campaign decided to scale back resources in Michigan and move them to other states, such as Minnesota, New Mexico, Pennsylvania and Wisconsin.
DuHaime and Greg Strimple, a senior campaign adviser, included Maine in a number of states they say were “not safe in any direction.”
They said Maine was one of several states where centrist Democrats have been successful, while underscoring that Obama is not one of them.
“Obama is the most liberal senator,” DuHaime said. “So we feel very confident in these states.”
According to the Associated Press, the McCain campaign checked advertising rates in Maine this week.
Strimple said that the campaign had its best fund-raising month in September since last year and therefore was looking for a “very aggressive last 30 days.”
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Foreclosure Aid in Sight with ‘Hope for Homeowners’ Program
HOMEOWNERS
The New Bedford Standard-Times
Courtney Hime
Boston University Washington News Service
October 2, 2008
WASHINGTON – New Bedford residents fearing foreclosure could see relief with the implementation of a new federal program aimed to reduce the number of foreclosures.
The U.S. Department of Housing and Urban Development kicked off the Hope for Homeowners program Wednesday. The three-year program will allow qualifying homeowners to refinance their mortgages. The new loan, insured by the Federal Housing Administration, would be a 30-year fixed-rate mortgage.
The program aims to prevent foreclosure on up to 400,000 homes nationally over the next three years. Kristine Foye, spokeswoman for the New England region of HUD, said via e-mail that the success of the program depends largely on communication between lenders and borrowers.
“The final participation numbers will depend on lenders, and we encourage them to work with borrowers to determine if this program is right for them,” she said.
Homeowners may be eligible for the program if their total monthly mortgage payment accounts for 31 percent or more of their gross monthly income, if the home is the borrower’s primary residence and if the existing mortgage started on or before Jan. 1, 2008 with at least six payments made.
There is lingering concern that lenders might be reluctant to take part because they would lose money on the original mortgage.
Tanisha Warner, spokeswoman for Consumer Credit Counseling Services, a division of Money Management International, for example, said this could put lender participation in question.
However, she said, the losses suffered by participating in the program might be less than the cost of foreclosing.
“Most lenders do not want to foreclose,” she said. “In the long run, they would lose money anyway. This is just a way of taking a smaller cut and keeping someone in the home and guaranteeing the home is still on the books.”
HUD’s Foye said, “Everyone benefits when a lender doesn't have to take possession of a foreclosed house and try to sell it.”.
Nationwide, 19 lenders had signed up for the program as of Thursday, according to Lemar Wooley, spokesperson for HUD. He said the department is working to determine where the interested lenders are located and whom they serve.
Foye said she was unsure what impact the program would have on the New Bedford area specifically.
“We don't have an indication of how the program will impact local areas because it will really depend on how many people apply,” she said.
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N.H. Representatives Still Undecided on Bailout Package
HOUSE
New Hampshire Union Leader
Jenny Paul
Boston University Washington News Service
10/2/08
WASHINGTON-- New Hampshire’s two Democratic House members, who voted against the initial $700 billion financial bailout package on Monday, won’t say how they will vote Friday when the House takes up the revised legislation that the Senate overwhelmingly passed on Wednesday.
Rep. Carol Shea-Porter said Thursday she is glad the Senate added renewable energy incentives and a provision to adjust the alternative minimum tax so 20 million Americans avoid paying it, but said she still had concerns about the bill and how it would affect middle-class Americans. The legislation authorizes the treasury secretary to use up to $700 billion in taxpayer money to purchase troubled mortgage-backed securities.
“I do like what they’ve added,” Shea-Porter said. “I think a lot of it helps the people on Main Street.”
Shea-Porter, who has voiced concern about the breadth of authority the bill gives to the treasury secretary, said she wants to make sure that her decision protects middle-class Americans.
Rep. Paul Hodes also is concerned about protecting taxpayers and wants to make sure the legislation adequately addresses home foreclosures, said Mark Bergman, Hodes’ communications director. Hodes was not available for comment Thursday.
Representatives for both congressional offices said they had not received any calls from constituents who were having trouble securing credit. Shea-Porter said about half the callers to her office supported the bailout, while Hodes’ office reported that a “substantial” number of callers were against the legislation. Bergman said Hodes has spoken with bankers and other New Hampshire residents who favor the bailout.
“He has talked to New Hampshire community bankers, people in the financial industry, who are not happy,” Bergman said. “He is listening to all sides of this. He’s coming in with an open mind.”
Shea-Porter said she and other members of Congress will have to stay in Washington to craft another bill if the House doesn’t pass the legislation.
“What I would like to say to the financial markets and to the people in New Hampshire is that we will continue to work on this,” Shea-Porter said Thursday. “Nobody knows how it’s going to turn out tomorrow yet, but we’re not going to walk away from this problem. We’re taking it very seriously.”
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New Hampshire Senators Solidly Behind Rescue Bill
Bailout
The New Hampshire Union Leader
Jenny Paul
Boston University Washington News Service
Oct. 2, 2008
WASHINGTON – Republican New Hampshire Sens. Judd Gregg and John Sununu rallied behind a revised economic bailout plan that passed the Senate with bipartisan support last night, saying the legislation would help free up the credit markets and aid New Hampshire residents who need access to consumer, auto and school loans.
"Credit is drying up," Gregg said. "The credit crunch is on top of us in a way that is affecting everyday America on Main Street."
After the House defeated the $700 billion rescue plan Monday, Gregg and other congressional leaders worked to revise the legislation in hopes of picking up the votes needed for passage in both chambers. The modified package adds tax break provisions and raises the cap on federal deposit insurance. The bill includes renewable energy tax incentives, extends expiring tax breaks for businesses, including the research and development credit, and adjusts the Alternative Minimum Tax so that more than 20 million Americans avoid paying it.
Gregg said he didn't mind including the extra provisions in the bailout bill.
"I don't have any problem with passing tax cuts onto Americans," Gregg said. "It's not right to tax these people under the AMT because it was not designed to tax all these middle-income people."
The core of the bailout plan remains similar to the version defeated in the House. The plan authorizes the treasury secretary to purchase up to $700 billion in troubled mortgage-backed securities in an effort to free up the credit markets and allow banks to lend against valued assets.
An addition to the plan raises the federal deposit insurance from $100,000 to $250,000 for a one-year period in an effort to protect small-business owners and individuals who keep more than $100,000 in one bank deposit account.
"That's constructive, but it doesn't go to the essence of the problem," Gregg said of the insurance increase. "It does help people be comfortable keeping their money in one bank."
Sununu praised the increase, saying it would add a level of security and confidence for small business in New Hampshire.
"This bill is far from perfect, but it is necessary, and necessary now to protect all Americans," Sununu said.
He said he voted for the overall package because it was essential to protect the credit on which families and businesses in New Hampshire rely.
"We've read stories over the last two days about restrictions on the lines of credit for business, restrictions on lending for new cars and for new car loans," Sununu said. "And all of those things restrict our economy and prevent people from having the money they need for their family, but also for having the money they need to invest and create new jobs."
Gregg said the rescue plan protects taxpayers by limiting executive compensation and requiring the government to use all proceeds to pay down the national debt. Gregg said it is absolutely "inaccurate" to say the plan will cost taxpayers $700 billion because the government is purchasing assets that have value and will later resell them.
"We may actually make some money," he said. There's certainly not going to be any dramatic cost."
Gregg and other congressional leaders said public opinion began to change this week when the stock market plummeted Monday, credit tightened and consumers found it increasingly difficult to secure loans.
Gregg said he didn't want to speculate about what would happen if the House did not pass the bill.
"I hope that calmer heads will prevail," Gregg said. "People were damaged financially as a result of that vote in the House on Monday."
Gregg continued to stress that the plan was only part of a solution to the financial credit, but said passage of the plan was necessary to start to free up the credit market.
"We're not going to get out of the woods here," he said. "We're still going to have a bad economy. There's no question about that. But the difference between a bad economy and what a cataclysmic event this would be is exponential."
Shays Says Vote for Bailout Bill is ‘A Legacy Vote’
REACTION, Update
Norwalk Hour
Jordan Zappala
Boston University Washington News Service
10/2/08
WASHINGTON—Rep. Chris Shays knows that the vote he will cast Friday in favor of the emergency financial stabilization plan is one he will take to his grave.
“This vote [is] a legacy vote,” Shays, R-4, said Wednesday. “It’s one of the biggest votes you’ll ever be making. That’s why you have to vote with your conscience and live with it the rest of your life.”
On Friday, the House is expected to vote on the rescue plan for the second time this week – this time taking up the version the Senate passed late Wednesday night.
Democrat Jim Himes, Shays’ opponent in the 4th district House race, said that if given the chance, he too would vote in favor of the bailout bill.
“Yes, I would [vote] for the bill,” Himes said Wednesday. “Now I say that holding my nose, because it is nothing short of outrageous that this was necessary, but our economy is resting on a knife’s edge.”
Shays was one of 65 House Republicans who voted for the failed version of the bill on Monday – which would have released $700 billion that Treasury Secretary Henry Paulson requested last week in an effort to increase fluidity in the now-frozen credit markets. The House rejected the measure, 205 to 228.
“On Sunday night, I thought it would pass, but on Monday morning, I felt it slipping away,” Shays said. “I was surprised on one level because a ‘no’ vote was kind of like playing Russian roulette, but I also understand because many people had strong feelings against the bill.”
Shays said Wednesday on MSNBC’s Morning Joe that, prior to Monday’s vote, constituent response to the bill had been 30-1 against it, but that after the vote, the phones began to ring largely in favor. But the calls have become primarily negative once more, he said, highlighting the confusion that seems to be surfacing throughout the country.
Himes said his experience with 4th district residents has been different.
“Our district is heavy with financial services so, more than elsewhere, people understand the connection between financial services and the real economy,” he said Wednesday. “A businessman I spoke with today said…he was having trouble borrowing money to meet his payroll. The economy is grinding to a halt, and everybody’s angry.”
In an unexpected move, the Senate voted for its own version of the bill late Wednesday, before the House returned from its two-day recess. The Senate bill included several tax incentives designed to sway conservative Republicans wary of the rescue plan, and also would raise the limit on insured bank deposits from $100,000 to $250,000 per account in an effort to inject consumer confidence back into the banking system.
“I tried to get a $300,000 increase, so I’m thrilled this is part of the plan,” Shays said about the Senate’s new provision. “One of the reasons I stayed in D.C. [during the recess] was to advocate for this amendment.”
He said that the Senate’s decision to vote so quickly showed real leadership and that he largely supports the revised plan.
Himes said he, too, saw the changes as a bold step in the right direction.
“I think forward progress is critical, so if this gets us to a point where we’re able to restore confidence in the system, I think the decision is the right one,” Himes said.
On C-SPAN Wednesday morning, Shays said that while the Senate bill's new provisions might attract votes from several House Republicans, it has the potential to drive away more House Democrats, making the outcome of Friday’s vote uncertain.
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McGovern Says He Would Vote for Senate Economic Bill
REVOTE
Worcester Telegram and Gazette
Rachel Kolokoff
Boston University Washington News Service
October 1, 2008
WASHINGTON - U.S. Rep. James P. McGovern, D-Worcester, said on Wednesday that he would vote for the Senate’s version of the $700 billion financial system rescue bill should it reach the House floor on Friday.
Despite its imperfections, he said, the bill would prevent an economic meltdown in which markets would tighten further or even collapse.
“All of us are angry at Wall Street and this culture of greed, but we are where we are, and I think it’s irresponsible to do nothing,” Mr. McGovern said. “We need to act, and hopefully there will be enough votes to get this thing passed.”
Mr. McGovern said one of the bill’s imperfections is the tax-break package the Senate added to the bill on Wednesday. The package, which Mr. McGovern said would add to the biggest government debt in U.S. history, includes tax breaks for people who spend on alternative energy, businesses and children.
“I would’ve liked it [the tax break package] more if it was paid for, but the Senate has decided not to pay for it,” Mr. McGovern said.
Despite that flaw, Mr. McGovern said, the inclusion of tax breaks for Main Street may give members who voted against the bill on Monday an excuse to vote for it on Friday.
At this point, he said, House members must vote up or down on the package to avoid more amendments that would stall the package further, forcing each chamber to vote again.
“You can’t do anything unless you stabilize the economy, and that’s what this rescue package is all about,” Mr. McGovern said. “We need to take the next two steps, which are putting in proper regulations so it doesn’t happen again and then talking about enacting an economic stimulus package that will meet …basic needs, including infrastructure.”
Since Monday Mr. McGovern has been in his district, speaking with community members and explaining the reasons why he voted for the bill on Monday and why he continues to support it.
“To be honest with you, it was good to be home and away from Washington for a couple of days,” Mr. McGovern said.
A spokesman for U.S. Rep. Niki Tsongas, D-Lowe, said the Democrats are expected to caucus Thursday to discuss the Senate bill in greater detail and build bipartisan support for it.
Tsongas, who voted for the bill on Monday, said then that bipartisan action must be taken as soon as possible to restore market stability.
“We will continue to keep working in a bipartisan way, in coordination with the Bush administration, to come up with a solution to alleviate this crisis,” Tsongas said.
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Snowe, Collins Glad Senate Bill Has Passed
BAILOUT
Bangor Daily News
Maite Jullian
Boston University Washington News Service
Oct. 1, 2008
WASHINGTON — Republican Sens. Susan Collins and Olympia Snowe of Maine welcomed with gravity the U.S. Senate’s passage Wednesday night of a revamped $700 billion financial rescue plan.
“I feel like I did the right thing but I am sad,” Snowe said. “The American people didn’t deserve this.”
“It shows that when confronted with a serious economic crisis, the Congress can come together in a bipartisan way,” Collins said. “This legislation is necessary in order to avert an economic catastrophe that would have devastating consequences for anyone who relies on credit.”
Collins and Snowe said the modified version of the bill addressed the concerns they had.
“Compared to the Treasury proposal, there is much stronger oversight and accountability,” Collins said. “Those changes were critical to me supporting the bill.”
Both senators said they supported the Senate version of the bill that the House defeated Monday in part because of the additional protections for taxpayers, the curbs on executive compensation, and stronger accountability. The plan limits corporate tax deductions on executive compensation in excess of $500,000 and on golden parachutes.
“What we can do is ensure taxpayers are protected and these protections are embedded in this legislation,” Snowe said. “Then we’ll have to find out who is responsible. Somebody has to be responsible.”
The major changes to the House bailout plan is a one-year increase in the cap on federal deposit insurance, from $100,000 to $250,000, for banks and credit union accounts, and the extension of business and individual tax breaks that had expired.
The Senate financial rescue plan’s extension of tax breaks for businesses and individuals includes tax credits for the production and use of renewable energy sources.
Snowe said she supported the tax package attached to the plan but expressed doubts regarding the future of the plan.
“I don’t know if it’s going to work for or against us,” she said. “I guess somebody thought it would help us.”
The major provision of the bailout plan, giving $700 billion to the treasury secretary to buy troubled assets from banks, remains unchanged, as do provisions establishing an oversight board and creating safety measures for taxpayers.
The rescue plan is now headed to the House, where lawmakers are expected to vote on Friday on the modified version of the bill. Maine’s Democratic Reps. Tom Allen and Mike Michaud split their votes on the original bailout plan Monday when Michaud joined the majority in defeating the measure that Allen supported.
The bill’s failure that day echoed in the financial markets with the Dow Jones industrial average plunging by 778 points, the most ever for a single day.
Snowe and Collins hope the House will pass the modified version Friday to avoid further consequences on American families and the economy.
“I am absolutely worried about the consequences if it doesn’t pass the House,” Snowe said.
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Homeowners Could Get FHA-backed Mortgages Under a New Program
FHA
Bangor Daily News
Guanlei Ren
Boston University Washington News Service
October 1, 2008
WASHINGTON - Homeowners stuck with costly mortgages and facing foreclosure will be able to refinance into more affordable loans with the assistance of the Federal Housing Authority (FHA) under the HOPE for Homeowners program that took effect Wednesday.
“The turbulent economy has reached a boiling point, and the American people require and deserve immediate relief,” Maine Republican Sen. Olympia Snowe said in a Sept. 30 statement. “With these programs, homeowners can access FHA-insured mortgages or receive valuable tax credits for first-time buyers. I encourage Americans to take advantage of these beneficial provisions and contact the FHA today.”
The HOPE for Homeowners program is authorized to insure up to $300 billion in mortgages and is expected to serve approximately 400,000 homeowners over the next three years.
“HOPE for Homeowners will add to the Housing and Urban Development Department’s (HUD) existing efforts to make FHA refinancing available to homeowners who need it most,” FHA Commissioner Brian D. Montgomery said in a statement. “One year ago, FHA expanded refinancing into its FHASecure program. Since that time, we have helped more than 360,000 families keep their homes by refinancing with FHA, and we will assist a total of 500,000 families by the end of this year.”
The temporary and voluntary program is intended to create new equity for troubled homeowners to ensure affordability and sustainable homeownership. Participating borrowers will have to take out 30-year FHA loans for 90 percent of the current value of their home and share their newly created equity and future appreciation equally with the FHA, according to the agency.
Kristine Foye, a spokeswoman at the New England Region of HUD, said, “The program is really designed to help people stay in their home.”
To benefit from the proceeds of the loans refinanced with government insurance, investors and lenders have to agree to take substantial and significant losses, which would be less than the losses associated with foreclosure, according to the FHA.
“Anybody who is interested in it will need to contact their lender, to work with their lender being able to write down their existing mortgage,” Foye said.
According to the FHA, only owner-occupants who are unable to afford their current mortgage payments are eligible for the program. Qualified borrowers’ existing mortgages must have been originated on or before Jan. 1, 2008, and at least six payments must have been made. The borrowers’ mortgage debt-to-income ratio must be at least 31 percent. The borrowers also need to prove that they cannot afford their current loan payments and did not intentionally miss any payments and that they own only one home.
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Frank Reacts to Senate Economic Recovery Act
FRANK QUOTES
The New Bedford Standard-Times
Courtney Hime
Boston University Washington News Service
October 1, 2008
WASHINGTON -- Rep. Barney Frank said Wednesday he believes the Senate would approve the financial rescue plan that night. All along, he said, he was told the bill had more support among Senate Republicans than it had among House Republicans.
He said he expected the bill to be brought to the House floor Friday morning.
While most of the communications he has received from constituents have been in opposition to the bill, he’s heard from a number of industry leaders in the area who are concerned that it will not pass.
Maine Senators Call for Passage of a Revised Bailout Plan
Bailout Maine
Bangor Daily News
Guanlei Ren
Boston University Washington News Service
September 30, 2008
WASHINGTON - Maine’s two U.S. senators called Tuesday for the approval of a revised bailout plan after lawmakers in the House defeated the legislation by a 228-205 vote on Monday.
“Our nation is facing a dire economic crisis,” Republican Sen. Susan Collins said in a statement. “I am disappointed that a day following the U.S. House’s failure to pass legislation to address this issue, an agreement has yet to be reached on compromise legislation that will pass the House.”
The senator said that Congress must stay in Washington until an agreement is reached and the legislation has been passed.
President Bush warned Tuesday that the economic damage would last and be even worse if the financial rescue plan were not passed.
After the House rejected the plan on Monday fear spread among investors and the Dow Jones industrial plunged 777 points, the most ever for a single day. On Tuesday the market rebounded with the Dow gaining 485 points after it appeared that there would be an effort to revive the emergency rescue plan.
Republican Sen. Olympia Snowe said in a statement, “At a time of tremendous economic peril in this country, it is regrettable the bipartisan process has broken down.”
Both senators said the economic crisis had already affected Maine as shown by the recent inability of the state to sell a $50 million transportation bond that would be used to make critical transportation improvements and create as many as 1,700 jobs.
“I find it unconscionable that unchecked greed and a stunning lack of oversight has resulted in the economic calamity we face today,” Sen. Snowe said.
On Tuesday, Senate leaders of both parties vowed to work toward agreement on the bailout plan.
“Now it’s imperative that Congress continue to work together to forge a bipartisan consensus,” Sen. Snowe said.
Sen. Snowe and Sen. Collins both emphasized the need for strong protections for taxpayers, availability of critical credit, tough oversight and accountability of financial markets, and restrictions on executive compensation.
Democratic Rep. Mike Michaud, who voted against the bailout bill, said in a telephone interview that the plan put forth by Secretary of Treasury Henry Paulson did not really address the problem.
“Over the last 10 days, I seeked a lot of input from economists, banking regulators, the former FDIC chairman, and I was convinced that voting for the Paulson proposal would not offer banking institutions the capital that they need to free up the frozen markets,” Michaud said.
He said the revision of the bailout plan should include raising the $100,000 federal insurance on bank deposits and more details on how taxpayer money will be recouped.
Before the vote on Monday, Rep. Michaud’s offices received more than 2,000 phone calls and emails and about 90 percent of them opposed the bailout, according to Monica Castellanos, the congressman’s press secretary.
Democratic Rep. Thomas Allen, who voted for the plan, said in a statement that “it is imperative that Congress act responsibly to prevent any further deterioration to the financial underpinnings of our economy.”
He said that the failed bailout plan was not perfect, but it was an improvement over the original proposal.
“I will continue to work with members of Congress from both parties to build consensus and pass this critically important legislation,” Rep. Allen said.
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