Thursday, October 9, 2008

McCain's mortage idea to cost taxpayers $300 billion

John McCain, self-proclaimed maverick of less government and lower taxes, slide a debt-loaded missile under the radar yesterday that would cost taxpayers about $300 billion. During Tuesday's debate, McCain throw a wild pitch about his new plan for the government to buy up bad mortgages. McCain offered few specifics and appeared to staking a much needed claim on originality (even though Hillary Clinton proposed a similar idea in March).

When McCain announced his idea at the debate, his campaign released details of his newly dubbed American Homeownership Resurgence Plan online and sent it to reporters. The plan would enable the government to buy up bad home mortgages at a discounted rate while forcing lenders to "recognize the loss that they’ve already suffered.”

Lo and behold on Wednesday, after the media glare died down, McCain quietly reissued the plan and removed the language about lenders recognizing their lose and selling the mortgages at a discount. That means the government would pay face value for the bad loans.

Obama Campaign Economic Policy Director Jason Furman released a statement about the plan:
"John McCain wants the government to massively overpay for mortgages in a plan that would guarantee taxpayers lose money, and put them at risk of losing even more if home values don’t recover. The biggest beneficiaries of this plan will be the same financial institutions that got us into this mess, some of whom even committed fraud."

McCain's proposal coddles financial institutions while saddling taxpayers with $300 billion on top of the $800+ billion bailout bill. His so-called Resurgance Plan is a resurgance alright, of McCain's true positions - less government, more business.


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