When (and where) the 1% talk about 99%
By Jennifer Ablan and Matthew Goldstein
The last place you’d think a group of Wall Street financiers and ex-politicians would convene to come up with a master plan for fixing the housing crisis is a luxury lodge overlooking the Golden Gate Bridge. But in November, during the height of the Occupy Wall Street protests, that’s where 30 rich and powerful people assembled to “do a good thing” for America.
The meeting at Cavallo Point in Sausalito, Calif., aimed to “hammer out a business plan and chart a course through 2012″ for an investment vehicle that intends to buy up troubled mortgages and help out the homeowners all the while making a 20 percent annual return. You can read the details here
The group is led by Phil Angelides, the California politician, land developer and most recently, the chairman of a federal commission who led investigations into why the financial markets collapsed. The Federal Crisis Inquiry Commission was criticized for failing to come up with any real proposals preventing another crisis. Yet it seems to have inspired Angelides (his tenure at the FCIC ended last February) and others to come up with a market-based solution to the housing debacle.
Now that may be part of the answer. But once again, it seems to be a case of the well-off and powerful talking to themselves. In a letter to potential investors of Angelides’s Gordian Sword LLC, there’s lots of talk about doing good for America and its disastrous housing market. What’s missing at times, however, is the focus on the people hurting the most: Millions of Americans are struggling to keep up on their mortgage payments.
Consider this self-congratulatory remark in the letter
This narrative ends with a restored community: home prices level off, labor is free to move, consumer confidence returns, and perhaps the recovery can commence. Everyone involved — local government agencies and politicians, Servicers and even Wall Street — can take credit for neighborhood recovery.
That’s a lot of kudos for those who essentially helped contribute to the crisis.
Yet many in those neighborhoods — that is if they are still there — still blame those same folks for their problems.