by Carola Von Hoffmannstahl-Solomonoff

Now that Hillary has schlonged him by hook and crook, Bernie needs to fear for his future. Sure, Hillary will be forced to do a reach-out. Bernie will get the star treatment at the Dem Convention. Progressive promises will be made. The party platform will be symbolically tweaked. Little Debbie may even go down. But if Hillary is elected president, vengeance will be hers.

Bill Clinton has already said Bernie’s supporters will be “toast” come election day. Can Bernie’s burn be far behind? The strength of Bernie’s challenge has been a humiliation for Hillary. And she doesn’t do forgive and forget. Not for Hill that Godfather distinction between personal and business. Political opponents aren’t reps of valid difference; they’re agents of the perpetually churning vast conspiracy (launched by the right, swollen by the left) out to get the Clintons.

First, they came for Bill.

Then they came for Hill.

Trying to cheat her of the throne she’s earned by being married to him.

O to be a fly in the mind of potential President Hillary as she plots Senator Sanders’ future…

“I’ll show that socialist nobody. How dare he manspread all over MY party. I’ll put his office in the Senate basement bathroom. Committees? Don’t make me laugh. (Cackle cackle.) Funding? That– and a nickel! As for those ‘rumors’ of a federal investigation into the Burlington College thing– lawyer up, Bernie and Jane! I’ll be hands-on at the Justice Department.”

The Burlington College Thing

Burlington is Vermont’s biggest city (pop 42,452) and the home turf of Bernie and Jane Sanders. From 2004 till 2011, Jane was president of Burlington College, a private, non-profit liberal arts college. Burlington College was very small and very progressive. Official slogan: “Start a fire”. (Presumably a socially transformative one, not just a wienie roaster.) The college closed this May after staggering along financially for years. The killing burden was a $10 million mortgage loan engineered by Jane Sanders in 2010. Jane’s goal was to expand Burlington College via relocation to a more impressive setting. At the time, the college was operating out of a former supermarket which served a surrounding blue collar neighborhood.

Until a few decades ago, Burlington was primarily a working and middle class town with naturally occurring affordable housing. Though there were certainly social divisions, it was a pretty laid back place. Teens called it “Borington”. Thanks to progressive planning by local pols (including former Mayor Bernie Sanders) and assorted public and private real estate players, Burlington has been transformed into a hip happening city blessed with stacks of cookie cutter condos attractive to wealthy folks with a taste for views of Lake Champlain. Not that affordable housing doesn’t exist– subsidized digs are available for the qualified. Social divisions? Considerably more pronounced.

Jane Sanders’ aim was to move Burlington College out of the supermarket and into a former Catholic orphanage set on thirty-some wooded acres overlooking Lake Champlain. The lake front land was traditionally treated as public parkland by locals. In its day, the orphanage had a sinister reputation; the building eventually transitioned into headquarters for the Burlington Catholic Diocese. It was/is a mound of Victorian stone. A big place for a student body of roughly 200 (130 full time) but Jane reasoned that if you buy it, they will come. And while the acreage was extensive much of the building was unusable due to disrepair, keeping the actual learning space cozy.

Jane arranged for the college to purchase the building and surrounding acreage from the Burlington Catholic Diocese. They were eager to sell. Their coffers had been depleted by $17 million in settlements paid to litigants claiming diocese leaders covered up for predatory priests.

The deal Jane Sanders engineered was a private/public combo platter. The Vermont Educational and Health Buildings Finance Agency issued $6.5 million in tax free revenue bonds. People’s United Bank bought the bonds; Vermont College was on the hook to People’s for principle and interest. Also in play– a $3.5 million loan from the Catholic Diocese (guess those litigants didn’t totally strip the coffers) and a “bridge loan” of $500,000 from local developer Tony Pomerleau, a vintage Sanders supporter.

Long story short: Burlington College wasn’t able to meet its obligations and this spring, People’s United Bank lowered the boom.

Attempts had been made to save the college. But fund raising efforts were inconsistent and the results disappointing. Student body growth never met projected numbers. In 2011, Jane Sanders was ousted/retired as president– with a $200,000 parachute. The next president was the college’s former chief financial officer and a friend-of-Jane. She quit a few years later after receiving a no-confidence vote from students, faculty and staff. Eventually, the acres of lake front land surrounding the college were sold to a developer. (More condos coming soon, affordable slots included!) The money from the sale was helpful but insufficient. And the college’s accreditation was set to be canceled, due to its long running financial woes.

The announcement that Burlington College was closing was made the day after this year’s graduation ceremonies. No warning was given, students and faculty were left scrambling. Many are still twisting in the wind over things such as financial arrangements, transcripts, and pension plans.

Whether recent rumors of a federal investigation played a part in the suddenness of the endgame are unknown.

The issue said to be of federal interest? Jane Sanders allegedly misrepresented the college’s assets and projected income to the tune of $2 million when engineering her purchase deal. (Among other things, a future death bequest was painted as money in hand.) And as we all know post housing-bubble collapse, fudging assets and income to obtain mortgage loans qualifies as bank fraud, a federal crime.

Of course, in her eagerness to “start a fire” Jane may have just made mistakes. Ones the college board of directors didn’t spot. And Jane still has the support of the Burlington Catholic Diocese; its leaders say proceeds from the sale of the college property (the college building was recently purchased by the same developer who bought the surrounding land) covered what they were owed. However, some parishioners are not so sanguine and want legal action.

Meanwhile, the last few Republican Party animals in Vermont have been writing letters to Washington, requesting a federal investigation. Their most recent missive even targeted Bernie; claiming they have credible info that Senator Sanders improperly pressed People’s United Bank to do Jane’s deal. Bernie’s spokespeople characterize the charges as political lies.

In normal times, I’d say Bernie and Jane have nothing to worry about. Questionable real estate deals involving politicians on their home turf are a dime a gazillion. Intent to defraud is hard to prove. And as we all know post housing-bubble collapse, mortgage shenanigans are rarely prosecuted. But these aren’t normal times. Hillary could become president. And with her, any stick will do to beat an enemy.

I like Bernie– even if he did help turn Burlington into one more Bobo Paradise. I admire his grit. His run has been inspirational in many ways. I voted for him in the New York State Democratic primary.

For his sake– and Jane’s– I’m praying Trump wins in November.

by Carola Von Hoffmannstahl-Solomonoff

Holy moldering Marx, the working class is back! Drawn out of hiding by the Donald and Bernie. Cheerleaders for the Ownership Society who pushed subprime mortgages and equity draining as a substitute for NAFTA-gone jobs are aghast. As are devotees of identity politics. Solidarity Forever? Screw it. An overarching concept like class, with its multi cultural inclusiveness, could undermine decades of hard work fanning social divisions.

As for snobs on both sides of the political divide, for them it’s a real knuckle-drag to see the return of the “great unwashed”. Yes, West Virginia– there still are folks who use that phrase. Or think in its terms. That many of them are no better off economically or secure in their futures than the Morlocks they imagine and despise matters not. Illusions of superiority are as comforting as a baby’s blankie.

So– where has the working class been hiding? Answer: in plain sight. Only the term “working class” disappeared, not the actual people.

In an infamous scene from Sex & the City, the gals are discussing their sex lives (did they ever discuss anything else?) while getting a pedicure in a Korean nail salon. Miranda, a high-powered attorney, is dating a bartender. Charlotte, an art gallery manager with a wealthy husband, says the relationship has no future because a bartender is “working class”. The gals all laugh at such an archaic concept. Then the camera pans down to show the Korean women kneeling at their feet…

The term “working class” began fading out in the 1970’s; its erasure has been helpful politically to both left and right. The boon to the right is obvious; no working class means no need for organized labor. Not saying that not using the term is the sole reason unions have shrunk to a ghost of their former selves– just that it’s harder to organize people when they can’t name the group with whom their economic interests lie. And when that increasingly nameless group is made to appear ridiculous, boorish, and bigoted the organizing gets even harder. I mean, who wants to identify with–

Archie Bunker

Ah, Archie. The creation of liberal TV god Norman Lear, blue collar Archie ruled the sitcom world in All in the Family between 1971 and ’79. Talking trash with little cash. The latter wasn’t a sympathy factor, just another indicator of Archie’s social inferiority. Some claim Archie was an anti-hero and that white viewers secretly identified with him while pretending to scorn. But anti-heroes, after decades of cultural presence, tend to segue into respectability. So why does the term ”Archie Bunker” remain an insult?

Archie Bunker was an ugly stereotype. One that was allowed to stand because its target, the working class, was no longer deemed worthy of respect. Also because those being targeted were ambivalent about identifying as “working class”. Doing so flew in the face of middle class aspiration. Plus, the term was an ideological one associated with communism, our Cold War enemy, and in this country with hoary political groups still fighting the Stalin v. Trotsky wars. Many such groups featured the word “workers” in their titles. Comrades dressed the part, circa Woody Guthrie. The New Left called these groups “Old Left”. By 1971 their worker-centric influence had dwindled to an echo.

Not so New Left influence. Thanks to their piggy-backing the counterculture, rads of the New Left were hip and happening. Their cultural judgments carried weight. And from them, the working class got no respect.

Few groups on the New Left called themselves “worker” anything. In New Left minds, American workers had been corrupted by the success of organized labor and were now part of the problem not the solution. They had houses, cars, and televisions. Refrigerators full of beer. Cupboards stuffed with white bread. They worked in factories that belched pollutants and/or produced gas-guzzlers that carried people away from urban slums to suburban tract homes with lawns. (The New Left, with its amazing ability to intuit hidden motives, knew the exodus was really about racism not lawns.) But the biggest sin was support for the Vietnam War. That most working class people had kids, siblings, spouses, or friends fighting the war was no excuse. In Vietnam, the USA was Hitler. Which made all its supporters back home “good Germans”. Something New Left activists took great moral pride in not being.

Back to Norman Lear. Creator of Archie Bunker. Wealthy as hell but still an ace identifier of all things working class ugly, Lear has denounced Donald Trump. No surprise. Trump’s blue collar supporters are often called Archie. “Meathead” aka Rob Reiner, liberal son-in-law of apocryphal Archie, has also delivered a finger wag.  Apostle Meathead spreading his Creator’s Word…

One Last Thing

Thankfully for fans of the TV working class, Archie Bunker wasn’t the only blue collar guy to grace sets in the 70’s. There was also Detective Columbo of the LAPD. Underestimated. Rumpled. Smoking a cheap stogie, driving a beloved beater. Unlike Archie, Columbo never talked politics. All he did was ask homicide suspects gazillion nagging questions. Relentlessly. The payoff being his nailing arrogant elite types who thought they could get away with murder.

When I look at the people cheering Trump– and Sanders– at rallies in post-industrial places I don’t see the face of Archie Bunker. I see Columbo bringing it home. I can almost hear it…

“One last thing. Nothing important. I just need to clear up a few small details. It won’t take long. I know you need to get on with ruling. But first, can you tell me where you were when American jobs were being exported, cheap labor was being imported, and working class/middle class incomes were stagnating?”

Everybody into the beater!

by Carola Von Hoffmannstahl-Solomonoff

There have to be clowns. Without them, we might cry a river during election years. Pinching your nose while voting brings tears to the eyes of many. So send in the clowns. Or at least– a really sharp comedy.

Some clarification as to what counts as comic. The Mitt/Newt/Rick Show and MSM’s Fist Pump 4 Obama are stale. They keep working the same lines and pratfalls. Not all old shows are dullsville. The Government Real Estate Game is hoary as hell but keeps reinventing itself. The latest twist:

Mortgage Settlement Madness!

Honk-a-dollar. As in, the 25 billion of ’em coughed up by five mega lenders via the national mortgage servicer settlement. Also called the national foreclosure settlement. The lenders who hit homeowners with funky foreclosures and hence had to cough are Citigroup, Wells Fargo, Bank of America, JPMorgan Chase, and Ally Financial Inc. Ally is the loan artist formerly known as GMAC. Why the name change? Cause “everybody needs an Ally”*.

Fun factoids about GMAC aka Ally: In 2008, the US Treasury invested $5 billion in GMAC (a sub of General Motors) from the Troubled Asset Relief Program (TARP). In 2009, they added 7.5 billion, giving the government a majority stake in GMAC. In 2010, GMAC “rebranded” itself as Ally Financial Inc. By January, 2012, TARP had 12 billion invested in GMAC/Ally.

Is Ally’s slice of the mortgage settlement being served by TARP?

If so, please notify Peter he’s being robbed to pay Paul.

The Obama administration in the form of U.S. Attorney General Eric Holder pushed the mortgage servicer settlement; 49 state attorney generals added their heft. A few balked at first. Not enough money for my state said some. Others were bugged that the settlement scotched legal actions supposedly in the hopper. (The ultimate deal doesn’t nix actions re other bads the AGs may have discovered when investigating foreclosure abuses. Future prosecutions could still take place in the future.) New York State Attorney General Eric Schneiderman was the scariest holdout. He was in the belly of the Wall Street beast. He was gonna get them bastids!

Compassion for struggling homeowners– and quid pro quo– eventually won over the AGs. The settlement will help homeowners avoid foreclosure via various programs (insert pratfall sound effect here) and in some cases, mortgage modifications. About 750,000 victims of foreclosure fouls will receive $2000 each. No mule though.

Not all homeowners will qualify for assistance. Selections must be made. Homeowners best get busy kissing butt on their local politicized housing scene; non profit housing helpers will be guiding the mortgage settlement dispensation.

By the time the settlement makes it to local levels, there will be less to dispense. Hands at higher levels are already helping themselves.

The Federal Housing Administration (FHA) immediately skimmed $1 billion from the payout kicked in by Bank of America (BofA). Apparently BofA boffed the FHA with a boatload of bad loans. Poor FHA. Their taxpayer-backed loan portfolio is always giving them trouble. As for BofA, they must have really been macking around. Their part of the settlement is the heftiest.

State pols are also swarming the mortgage settlement, with governors and state reps claiming that since the busted housing bubble busted their budgets they deserve a piece of the pie.

Missouri Governor Jay Nixon (Democrat) wants to use almost all of his state’s $41 million cut as a budget plug. The state legislature leaders (Republican) say Yay Jay. In Pennsylvania, Dems are pushing the Republican attorney general to channel settlement funds into poverty programs. Maryland’s attorney general will give 10% of the state’s settlement cut to Governor Martin O’Malley (Democrat) and state reps “to spend as they choose”**.

Just when you think Mortgage Settlement Madness! couldn’t get any funnier, Wisconsin Governor Scott Walker (Republican) flaps onto the stage with a plan to use $26 million of the foreclosure rescue fund to plug his budget hole. This from the Friend-Of-All-Homeowners.

It also seems funny (as in “weird”) that state attorney generals will be dispensing money to public officials from a national settlement made by major financial institutions under threat of legal action by the very same attorney generals. The AGs’ leeway to control the cash was a crucial part of the mortgage settlement deal. Overall, the settlement is an attorney general power enhancer.

An oft asked question is why the financial crash of 2008 and the massive taxpayer bailouts that ensued didn’t lead to any prosecutions of major players. One of the answers– and there are many, none of which go down easy– may be that our state attorney generals increasingly treat financial crime in high places as a power tool and revenue source rather than something to be prosecuted.

Meanwhile, out in the lesser criminal fields, the mortgage servicer settlement is sparking new grifts. According to a press release*** by North Carolina Attorney General Roy Cooper, scammers in that state are already working the “landmark settlement”. (North Carolina’s banking commissioner incidentally, will be overseeing the mortgage servicer settlement.) Calling homeowners and promising I can get you a piece of the settlement but first I’ll need your bank account number…

The Government Real Estate Game has done it again. Mortgage Settlement Madness! promises to be a comedy keeper.

*ally/Ally Financial, FAQs, Why is GMAC rebranding to Ally Financial, Inc.? 2010

**Some money from mortgage settlement to be diverted, David A. Lib, Associated Press, 02/22/12

***Watch out for sham mortgage settlement calls, AG warns, North Carolina Department of Justice, 02/22/12

by Carola Von Hoffmannstahl-Solomonoff

While down with the flu in January, I read a lot of Richard Stark. Aka Donald Westlake. A pile of volumes from Stark/Westlake’s Parker series towered on my nightstand. The adventures and misadventures of Parker, an ultra cold hearted professional thief, were the perfect antidote to fever.

The late Donald Westlake grew up in Albany, New York. When interviewed in 1995, Westlake sounded sardonic and oblique about his youth in the capital city. And while a number of books in the Parker series take place in upstate New York, Albany is never a central location*. Characters pass through it or around it. Usually in a stolen car.

In Backflash (Mysterious Press, 1998) Albany as the seat of state government is central to the plot, yet few scenes are set in the city. A complex heist and series of murders are put in motion by Hilliard Cathman, a retired fiscal planner for the state. Cathman whiles away his retiree time as a public policy consultant with a low rent office near the “huge dark stone pile of the statehouse”. He is, as Parker puts it, one of the “camp followers of state government”.

Due to his opposition to legalized gambling, Cathman is an unsuccessful camp follower. His potential clients in legislative places are eager to tap into a major new source of revenue; Cathman won’t give them his consultant stamp of approval. His objections to gambling are arguable but reasonable. But as Parker suspects, Cathman’s ego investment in being proven right has become unbalanced.

To prove his premise that gambling draws crime, Cathman recruits Parker to rob a riverboat casino that’s being allowed to ply the Hudson between Albany and Poughkeepsie as a limited-time experiment. The casino’s political backers hope the experiment proves so successful as to open the door to gambling statewide. As a fiscal planner for the state, Cathman was privy to inside info about the casino’s security arrangements, etc. He feeds the info to Parker and his crew. They successfully pull the heist.

As usual in a Parker book, there are numerous slips twixt cup and lip. Most caused by the greed and stupidity of pilot fish swarming the haul. But the wildest card in the set-up is Cathman. In a final confrontation in Cathman’s home in Delmar (an Albany suburb popular with state employees) Parker discovers just how far round the bend Cathman has gone– and that he has a self-aggrandizing plan which if allowed to play out will doom Parker.

How many times do regular citizens make the same discovery about policy planners? Parker is Everyman!

Speaking of planners with killer bees in their bonnets…

New York State Governor Andrew Cuomo is big on forging more public-private partnerships as engines of state economic development. He said so in his Executive Budget speech on January 17th. (While sick I read non-fiction fiction as well as the real stuff.)

Yes indeed. More crony capitalism will cure New York’s economic ills. And Anna Nicole Smith needed bigger breast implants.

New York is crony capitalism central. The quadruple D example? The public-private partnership of Wall Street and Washington that pumped the housing bubble and sank the economy beneath a mountain of dodgy mortgage-backed investment paper. As assistant secretary and then secretary of HUD from 1993 to 2001, Andrew Cuomo helped steer housing policy when the bubble started swelling and the paper flying. Cuomo’s HUD policies included pushing “a reform that allowed Fannie (Mae) and Freddie (Mac) to receive affordable-housing credit for buying private subprime mortgage-backed securities”**.

HUD was also the parent organization of OFHEO (Office of Federal Housing Enterprise Oversight), the agency then charged with oversight of Fannie Mae and Freddie Mac. OFHEO, under Cuomo and other HUD heads, resisted efforts to change Fannie and Freddie’s murky and ultimately disastrous public-private status.

By the time the bubble popped, Andrew Cuomo was New York State Attorney General. In 2007, Attorney General Cuomo announced that in light of the pop, he was launching an investigation into “industry-wide mortgage fraud”. Fannie Mae and Freddie Mac were prime targets. In a letter to Freddie Mac Cuomo implied that Fan and Fred had colluded with lenders to profit from mortgages based on inflated appraisals. In a matter of months, Cuomo’s investigation dissolved into a payout of $24 million from Fannie and Freddie. No admittance of wrongdoing required. The fraud problem was found to lay mainly with– and could be corrected at– the appraisal level.

Fannie and Freddie’s payout went to establishing the Independent Valuations Protection Institute. The institute, with board members approved by Andrew Cuomo, would monitor lenders for compliance with a new Home Valuation Code of Conduct (HVCC) authored by Cuomo. Though merely a state attorney general, Cuomo’s national clout re appraisal policy was enhanced by support for the code from OFHEO, the agency overseeing Fannie and Freddie.

In the bubble years many appraisers complained about being pressured by lenders to inflate values. Yet equally large numbers hate the reform Cuomo engineered. Some claim he had a conflict of interest when establishing HVCC.

Starting in 2004 and until becoming NY attorney general, Cuomo was chairman of the board of advisors at Appraisal Management Company (AMCO) a Cleveland-based private “independent valuations solutions company” doing business with national lenders. AMCO, a subsidiary of Worldwide Outsource Solutions Ltd., had a board full of HUD; including former HUD secretary Jack Kemp (under Bush 1) and assistant secretary William Apgar (under Clinton). Edward J. Davidson (Ed Davidson), CEO and board chairman of AMCO and Worldwide Outsource, has been a consultant for Fannie Mae.

In October, 2004, Cuomo, Kemp and Apgar told reporters at the Mortgage Bankers Association annual convention that “the integrity of the appraisal process has broken down”. American Banker described the presentation as “part admonishment of lenders, part sales pitch for a vendor”.***

In March, 2005, Cuomo, Davidson, Kemp and Apgar, in a letter on AMCO stationary, pressed OFHEO’s drirector, Armando Falcon, to have a “totally independent source” review the loans within Fannie and Freddie’s “securities field”.

In February 2006, AMCO issued a press release applauding board member Andrew Cuomo’s support for the newly formed non-profit Appraisal Advocacy Coalition. According to Inman News (a real estate publication), the coalition’s missions included protecting appraisers from “unfair competition“.

Maybe HVCC was a much needed reform. Note “was”. The Dodd-Frank Wall Street Reform and Consumer Protection Act is slated to end HVCC. (Then again, it may just be whittled down. Appraisers fear that the reports of HVCC’s death are greatly exaggerated.)

Discerning the true motives of public-private players can be tough. When on the public side, they so often launch investigations and reforms that obfuscate obfuscate obfuscate. I say keep the public public and the private private. It makes the game easier to call.

When Governor Andrew Cuomo touts public-private partnerships as the path to NY economic development, a sizable majority of New Yorkers get starry eyed. Not I.  It took more than the housing bubble and its bad paper and players to make me an unbeliever. Viewing New York’s public-private deal maker, the Empire State Development Corporation (ESDC or ESD), in action has also been instructive…

See corruption and wishful thinking meet and marry! See billions in public money tossed at elephantine projects that come to naught! See ginormous tax breaks produce handfuls of jobs in depressed regions! And oh yeah– see small property owners get dispossessed at the behest of powerful developers. Rampent eminent domain abuse being one of the rottenest of New York’s public-private fruits.

Next up in the fruit bowl: Governor Cuomo’s plan for a massive Las Vegas style casino in New York City. Most likely at the Aqueduct Racetrack in Queens. The casino would be built by the Genting Group of Malaysia. (They already run slots at Aqueduct.) To enhance the project, the state would erect “the largest convention center in the nation”  nearby. And get this; the casino could put all of New York State on “an inside track to expanded gambling”.

I just hope nobody tries to chill the project with a Parker.

As for Cuomo, his crony capitalism fever keeps rising. In late January, corporate campaign donors with their eyes on infrastructure prizes paid $50,000 each to sit next to Cuomo on a panel at a national Democratic Governors Association conference. The confab, which was held in Manhattan, was hosted by Governor Cuomo. No press or public allowed.

Sometimes it pays to go private.

* “I’ll leave Albany to Bill Kennedy. He’s found a lot more there to write about than I did.”  Mystery Man award-winning novelist Donald Westlake remembers his Albany haunts, Paul Grondahl, Albany Times Union, 10/21/95

** Cuomo’s HUD career under scrutiny, Buffalo News, 08/21/10

***Fears about Appraisals, and Other MBA Buzz, Jody Shenn, American Banker, 10/27/04

by Carola Von Hoffmannstahl-Solomonoff

Ho ho ho! On December 21^st, the National Association of Realtors (NAR) will gift the nation with the true number of existing home sales between 2007 and 2010. The NAR’s inflated numbers were flagged earlier this year by CoreLogic, a California based data firm. When confronted, the NAR grumped they’d look into it. Sounding more like dwarfs caught mining fool’s gold than housing helpful elves. Several seasons have passed. Now, a few days before Christmas, when most people pay scant attention to news, the NAR will be giving us a wee bit of truth. How holiday special is that? Scrooge’s transformation pales by comparison.

Like Scrooge, the NAR (rhymes with guar, which when partially hydrolyzed is fully fermentable in the large bowel) had to be coerced into transformation. With CoreLogic its Ghost of Christmas Past.

Speaking of the past, though the Washington/Wall Street nexus (On Fannie, on Freddie, on Banksters and Brokers!) financially powered the housing bubble that led to the economic crash, Realtors were the relentless boots on the ground. Threatening folks that if they didn’t buy now they’d be forever priced out of the housing market. Evoking an eternity of rental serfdom under Landlord Potter. As opposed to an eternity of low or no equity mortgage serfdom under Banker Potter.

Then there were NAR TV ads. Such as the 2007 gem claiming “when you have a family it’s always a good time to buy“. Underwater families are yukking over that one. Or how about the 2008 tout for Uncle Sam’s $8,000 first-time homebuyer tax credit? The break that suckered the last clueless buyers into paying still-inflated housing prices, jacked mortgage fraudsters posing as first-time buyers, and according to many Realtors (now) prolonged the housing crash. And the ads keep coming…

During 2011, reforms limiting government backed housing programs that leave taxpayers holding the bag for mortgage failures and related bailouts have been kicking around Washington. At the same time, the NAR has been blitzing the airwaves with a fear monger pitch featuring a Norman Rockwell grandpa fretting about “the dream of home ownership being threatened“.  Then there’s their “Public Awareness” campaign which champions the housing industry as job creator. What pol with elections looming could resist that?

Not that many pols ever resist the NAR. Its lobbying clout makes pols go all wobbly in the large bowel. For years, the NAR has beat back wave after wave of legislative reforms that threatened to reduce taxpayer exposure to housing-related risk.

Still, NAR concern re job creation is admirable. Many of the jobs that flow from housing are in the unionized construction trades, the last bastions of middle class wages for America’s blue collar workers. The worker-friendly NAR recently made Bill Malkasian, former head of the Wisconsin Realtors Association (WRA), their Vice President of Political Strategic Planning. When head of the WRA, Malkasian threw the group’s full weight behind union-busting Governor Scott Walker. The Koch brothers gave big to Walker, but the Wisconsin Realtors Association gave more. In his new position Bill Malkasian will be in the NAR field, leading political strategic efforts at state and local levels all over the nation.

By the buy, Bill’s new job is part of the NAR’s atta-boy response to the U.S. Supreme Court ruling that corporations and other entities have the same political speech rights as individuals and can spend as much campaign cash as they wish.

The NAR has other reasons to be cheerful. As 2012 draws nigh, its leaders are making their annual Happy Days Are Almost Here Again predictions. Plus, the NAR is based in the USA not the Peoples Republic of China.

In China, underwater homeowners are doing more than seeking interest write downs or living rent free while awaiting foreclosure. The “fang nu” (housing slaves) of China’s housing bubble are storming the gates of real estate heaven.

The Los Angeles Times, in its December 13^th article China’s housing bubble is losing air, describes a revolt of the fang nu in Shanghai. Condo buyers who’d been told by salespeople that “prices wouldn’t go down” became enraged when the project’s developer (China Vanke Co.) slashed purchase prices by 25% for later buyers. The condo cadre trashed the sales office and tussled with employees. It took the police three days to quell the protest. Cities including Shanghai and Beijing have had at least seven similar uprisings in three months, in which mobs “destroyed real estate offices and demanded refunds of up to 40%”.

According to the New York Times (Village Revolts Over Inequities of Chinese Life, 12/15/11) as many as 180,000 “mass incidents” have taken place in China over the last year. There are numerous reasons for the uprisings. But a prime cause is another twist on the real estate game–

“…the seizure of land by well-connected private developers or government officials, which invariably involves forced evictions for meager compensation….these seizures are supported by local governments that have come to rely on proceeds of land sales and development to pay for day-to-day operations.”

A familiar scenario to anyone who followed the rise of eminent domain abuse during the U.S. housing bubble daze. When moderate and low income property owners discovered their neighborhoods had become land-grab goldmines for pols, planners, and developers. Justification? Revitalization by any means necessary.

Like Mao once said, “Real estate is not a dinner party”.

OK. Mao Zedong aka Mao Tse-tung aka the Great Helmsman of the Peoples Republic of China till 1976, didn’t really say that. He said this:

“A revolution is not a dinner party, or writing an essay, or painting a picture, or doing embroidery; it cannot be so refined, so leisurely and gentle, so temperate, kind, courteous, restrained and magnanimous.”*

If you substitute “real estate” for “revolution” Mao’s words could come from a sales motivational speech. One which would wrap with the threat that coffee (or tea) is only for closers.

*From Report on an Investigation of the Peasant Movement in Hunan