In the middle of a scandal involving a large number of major banks, members of the Obama administration have remained adamantly opposed to a national moratorium on foreclosures. The Party for Socialism and Liberation and other forces on the left have been calling for a moratorium since the beginning of the housing crisis, a position which has gained prominence since it was revealed that a huge number of foreclosures were improperly and illegally processed.
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In order to get houses on the market as quickly as possible, Bank of America, GMAC, JP Morgan, and other financial giants utilized “robo-signers”, employees who would authorize foreclosures without following appropriate procedures. Not surprisingly, many people were forced out of their homes even though they had every right to stay.
To save face and avoid further, potentially expensive legal complications, many of the financial corporations involved have temporarily stopped repossessing people’s homes. However, this falls far short of a national moratorium, which would freeze all foreclosures across the country and provide real relief without leaving people at the mercy of their bank.
Officials have come out in opposition to struggling homeowners. Shaun Donovan, Secretary of Housing and Urban Development, stated that a national moratorium “has the potential to hurt not only those individual home buyers but to delay the recovery of the housing market” (latimes.com, Oct. 14). Here, Donovan makes the goals of the administration perfectly clear: to protect the bankers’ profits by forcing people to leave their homes as quickly as possible.
Treasury Secretary Timothy Geithner, in an interview broadcast on PBS, claimed that a national moratorium was against the public interest, “In neighborhoods that have been most affected by the foreclosure crisis, where you see lots of houses on the block empty, unoccupied, what it means is those communities would be living longer with houses unoccupied, with more pressure on their house price” (Bloomberg.com, Oct. 13). According to Geithner’s twisted logic, ending foreclosures and keeping people in their homes would lead to more empty houses.
Of course, this argument is absurd. What concerns Geithner and all other representatives of the capitalist class is profit. It is for this reason that houses are constructed under capitalism, not so that people can have a place to live.
Socialists, on the other hand, believe that government policies should be aimed at meeting human needs. We recognize that all people deserve decent, affordable housing. A national moratorium on foreclosures would help poor and working people realize this right, but as the administration’s attitude shows it will not be won unless we organize and fight back.
