Reply #12: Dean Baker [View All]

[chill_wind]

Dean Baker, co-director of the Center for Economic Policy Research, says it’s “hard to see amounting to much.” He assumes the revamped program to help closer to 500,000 homeowners over the next couple years. “That’s something, but if we assume an average saving of $4,000 each, this gets us $2 billion in money freed up. Also, in many cases these people would be better off walking away.”

Every little bit helps, says Baker, but much this programs offers less than is necessary to move the needle on unemployment or stabilize the housing market.

The White House’s liberal critics argue that the administration could do more — a broader refinancing program, one that creates greater incentives for lenders and borrowers, and perhaps one that actually reduces homeowner’s principal, to bring them back above water. Bolder steps may be on the horizon. White House spokesman Jay Carney told reporters Monday to expect further executive action by President Obama in the weeks ahead.

TPM:

Brian Beutler October 24, 2011, 3:49 PM

http://tpmdc.talkingpointsmemo.com/2011/10/economists-white-house-mortgage-plan-is-a-good-but-modest-plan.php?ref=fpb