Bush Changes Heart on Housing
The Bush administration has reversed course over its opposition to Congress’s mortgage crisis legislation, announcing Wednesday that the White House will back the measure just two days after it vowed to veto it, The Associated Press reported this morning.
The bill would allow homeowners with troubled mortgages to refinance those loans at rates reflecting today’s deflated market. It also contains an amendment (pushed hard by Treasury Secretary Henry Paulson) offering taxpayer cash to Freddie Mac and Fannie Mae — if it’s required to keep the embattled mortgage backers solvent.
President Bush, however, has objected to a largely Democratic provision granting almost $4 billion to the nation’s hardest-hit regions — money allowing local governments to snatch up foreclosed homes in order to stabilize other properties nearby. Bush has said that provision goes too far to bail out the lenders who were largely responsible for creating the mess.
Today, though, White House press secretary Dana Perino announced that Bush will tolerate the grants for the sake of passing the package. From the AP:
"The positive aspects of the bill are needed now to increase confidence and stability in the housing and financial markets," Perino said. "While we have concerns with other aspects of the bill, it is important that the new authorities are put in place promptly. And so President Bush will accept Secretary (Henry) Paulson’s recommendation to sign the bill."
Without the hovering veto threat, the bill could be enacted this week.