Obama Should Do The Right Thing, Even If It’s For The Wrong Reason
When was the last time the Left felt all warm & fuzzy about something Obama did on the economic front? Maybe when he used a recess appointment to place Richard Cordray at the Consumer Financial Protection Bureau (CFPB) and finally got that up and running for the American people? (Although I still resent that he didn’t do the same for Elizabeth Warren, the hope of seeing her in the Senate tides me over.)
Still, the point is that the single biggest issue of this election is one where the Democratic base is least satisfied. Many have suggested that Obama should fire Ed Marco , acting Director of the Federal Housing Finance Authority (FHFA), over his refusal to come around on principal reductions for mortgages backed by Fannie and Freddie (more than 60% of all home loans in the US.) This could be a wildly popular move with middle class homeowners, and many economists, Nobel laureate Paul Krugman among them, would love to see this policy put in place.
The problem is, Obama can’t fire DeMarco. The FHFA Director can only be fired for cause; and this situation really doesn’t reach that bar. But that is not to say that Obama can’t get rid of him. DeMarco is only the *acting* Director, meaning one very simple way to get rid of him is to seat a permanent Director.
(Ha ha! That seems funny, I know – because what are the chances of the Senate actually confirming an Obama appointment during election season? Right?)
But all hope is not lost – Obama could do the same thing he did with Cordray, and appoint him this month while Congress in on recess. “Yay! A bailout for taxpayers and not the banks!”, the people would cheer. And what could Mitt Romney say? Surely he would bloviate and moralize about people not accepting personal responsibility…but how true could that possibly ring coming from a man whose career was built on cut-throat manipulation of the market? Surely, the GOP base loves that talk, but those undecided swing voters are probably more inclined to go with the guy who does something for them.
Don’t worry for the moment over whether or not principal reduction is good policy (economists will quibble). Just worry about the immense popularity of such a move.
Would Republicans shrilly scream that it’s all a crass political move? Yes. But so what? They would do the same if the tables were reversed. And sometimes, it’s okay to do the right thing, even if it’s for the wrong reasons.