Senate Refuses to Let Judges Fix Mortgages in Bankruptcy

Ed Schultz has really been on this the past couple of days.

Dick Durbin, said, on his show, that THE BANKS OWN THE SENATE.

Now, after getting BILLIONS from the American Taxpayers,

These mofos have gotten their minions in the Senate to vote down a proposal that would help the average American who is having trouble with their mortgage.

Let that sink in.

From The New York Times:

Senate Refuses to Let Judges Fix Mortgages in Bankruptcy
by STEPHEN LABATON
Published: April 30, 2009

WASHINGTON — The Senate handed a victory to the banking industry on Thursday, defeating a Democratic proposal that would have given homeowners in financial trouble greater flexibility to renegotiate the terms of their mortgages.

The House of Representatives, meanwhile, overwhelmingly approved a bill backed by the Obama administration that would limit the ability of credit card companies to charge high fees and penalties. The bill, approved 357 to 70, still faces obstacles in the Senate, where — as the action on Thursday illustrated — the industry has more clout, particularly among Republicans and moderate Democrats. In recent days the White House, partly in response to polls showing the significant public outrage over high fees charged by credit card companies, has begun to work for its passage.

The mortgage provision garnered only 45 votes in the Senate, falling well short of the 60 votes necessary to break a threatened filibuster to a measure sponsored by Senator Richard Durbin, Democrat of Illinois, that would give bankruptcy judges greater flexibility to modify mortgages. In recent weeks, major banks and bank trade associations worked closely with Senate Republicans to stop the measure. Twelve Democrats joined all the Republicans in voting against it.

From Booman Tribune, the list of traitors:

12 Worthless Democrats
by BooMan
Thu Apr 30th, 2009 at 07:39:04 PM EST

In the most demoralizing vote since the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, twelve worthless Democrats just earned my undying enmity by voting against cramdown.

Max Baucus (D-MT)
Michael Bennet (D-CO)
Robert Byrd (D-WV)
Tom Carper (D-DE)
Byron Dorgan (D-ND)
Tim Johnson (D-SD)
Mary Landrieu (D-LA)
Blanche Lincoln (D-AR)
Ben Nelson (D-NE)
Mark Pryor (D-AR)
Arlen Specter (D-PA)
Jon Tester (D-MT)

Honorable mention: Evan Bayh (D-IN)- who did all he could to kill cramdown in committee and then thought he could be cute and vote for it on the floor.

Obama Sides With Banks Accused of Racism

Hat tip: a JJP reader

From Mother Jones:

Obama Sides With Banks Accused of Racism
The administration defends lenders that allegedly bilked minority customers. What gives?
—By Stephanie Mencimer
Tue April 7, 2009 9:30 AM PST
A number of big national banks stand accused of systematically bilking black and Latino borrowers. And the administration of our first black president is siding with the banks.

At the end of April, the Obama administration will go before the US Supreme Court to argue that those banks—including bailout recipients Bank of America, Citi, Wells Fargo, and JPMorgan Chase—should be allowed to duck a state investigation into their lending practices. If that sounds like the politics of the past, it is. The Obama administration has opted to maintain the stance of the Bush administration—one opposed by the NAACP and other major civil rights groups. And it won't be some Bush holdover making the arguments in Cuomo v. The Clearing House Association (an industry group whose membership includes the world's largest banks). Instead, the banks will be defended by the office of Obama's new solicitor general, former Harvard Law School dean Elena Kagan, whom some conservatives have branded a "radical leftist" because of her record opposing military recruitment on college campuses.

The case got its start in 2005, when then-New York attorney general Eliot Spitzer discovered that many banks operating in his state were issuing a disproportionate number of high-interest loans to African Americans and Hispanics. Invoking state anti-discrimination laws, Spitzer wrote to those banks, politely asking for more information about their lending practices. He didn't even issue a subpoena. Rather than respond to the request, the banks sued Spitzer. They argued that they were legally entitled to blow him off because federal banking law preempted the state investigation—that is, only the feds could make such a request, not some lowly state AG.

To make their case, the banks sought help from the Bush administration, through the Office of the Comptroller of the Currency. The OCC is a little-known federal bank regulator that over the past decade has become increasingly active in helping those banks and their subsidiaries squash state efforts to rein in abusive predatory lending practices. The OCC joined the banks in the case as a plaintiff, asserting that a Civil War-era banking law made the OCC the only sheriff in town. When it came to big national banks like Bank of America and Wells Fargo, only the OCC, it argued, could force the banks to comply with state consumer protection laws like those banning racial discrimination in lending.

With the OCC's backing, the banks prevailed in the trial court and the US Court of Appeals for the 2nd Circuit. New York's current attorney general, Andrew Cuomo, has appealed the case to the Supreme Court, which will hear oral arguments in late April. Kagan's office will be representing the OCC. The administration's position in Clearing House stands in sharp relief to other parts of the US government, where financial system regulators have recently come out in opposition to shielding banks from state consumer protection laws and enforcement.

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