Obviously, we're not getting a fair shake in Washington on the whole foreclosure / housing bubble debacle.
I look at the closed storefronts, unemployment numbers, failed restaurant chains, boarded up or for-sale houses, cut-backs in police, fire fighter, and teacher staffing, closure of State parks or downgrading of services, public transit cuts and fare hikes, privatization of tollways, city parking, water supplies, and everything else, all while the existing infrastructure is crumbling all around us, rusting instead of being upgraded. I could probably run that sentence a lot further down the page. Veterans come home and they're left to fend for themselves. Is it any wonder the most popular topic on Twitter a month or so ago was " F#*k Washington?"
There's a way, I think, that States might be able to start putting things back on track locally if they so choose to do so. It sure isn't going to be by raising property taxes, which is only making the housing debacle a housing cataclysm. It's not going to be by raising individual income taxes, because that will only decrease consumer spending, and make it harder for working people to continue keep their monthly bills current. It won't be by increasing user fees, for the same reasons.
I think what the States need to do, and should do, has four basic parts to it:
Part 1: Use Eminent Domain powers to seize bank-owned properties with a broken chain of title or mortgage ownership, and block any foreclosures without 100% perfect documentation.
Clearly, the banks have operated fraudulently in an insane number of cases, failing to properly document and record title and mortgage ownership, and in some cases, foreclosing on homes and commercial properties that there isn't even a mortgage on. You read that right, foreclosure mills in this country are operating that far from sanity. This is the only way you're ever going to get a valid and clear title back on many of these properties. Many people won't buy them now because they can't be guaranteed that they'll have a clear title with no lien on it. There is also the deteriorating conditions of foreclosed homes, the problems with squatters, criminal or not, and what these issues are doing to the values of adjacent properties. In reality, we could see housing prices fall back to 1980 levels or below yet, if nothing is done.
As far as what to do with these houses once they're in State ownership, that's part of how to tackle unemployment and homelessness.
Part 2: Put the homeless in houses and the unemployed to work.
Instead of using cash to pay for all State-required labor, using housing credits and food credits. Put people to work repairing the seized homes and maintaining State properties, filling in administrative functions the State doesn't have cash to pay for, and other places where the State needs labor but doesn't have the budget to support those needs. In return, the laborers could be given residence in the houses seized in part one above, food stamps, training on relief gardening for food, and a documented position to put on their resume or work history.
This allows the State to do more and provide more services with less cash, creating a win for the state. It allows for the maintenance, up-keep, and habitation of homes that were foreclosed on, providing a win for homeowners in the neighborhoods where these houses are. (Or where the commercial-property foreclosures are)
The relief garden training allows for growing food and where possible, raising poultry, reducing the need for State outlay in food stamps. If neighborhood gardening groups are established, it can also help foster a sense of community, something often lacking in today's " move-for-a-job-at-the-drop-of-a-hat" society.
On this plan, people are still working for their food and housing, they're just not using cash to do it.
Part 3: Establish non-profit agencies to administer these programs for the State.
Rather than all-out socialism, the State could establish non-profit agencies on a regional basis to move these properties through the system, from building rehabilitation, to labor-occupied housing, to sale in the real estate market as the economy improves and recovers. This process would have to be initially defined and through experience refined, but it would prevent long-term State ownership of private property. The State would be the ultimate authority for oversight, and this would make some allowance for regional conditions and adaptability. These non-profits could be staffed by the same unemployed labor pool under the same terms as the rehab work, and this would provided local administrative work for the physically-disabled workers who need work that suits their physical abilities.
Part 4: Ban all State and municipal tax breaks for businesses that are not owned or incorporated withing the State, and ban taking public loans out from out-of-State banks or other entities other than private investors willing to buy bonds.
This would focus local-government taxation relief on smaller local businesses and industry. This would help bring business and jobs back locally without being dependent on national, federal policy structures. If larger businesses want to sell or operate within the State, they will have to pay their fair share of State and local taxes, but small start-ups and local entrepreneurs would be able to compete enough to survive. This would also help reduce monopolistic market tendencies that have been rampant in the past few decades.
This would also help strengthen local banks and credit unions instead of large trans-national banking conglomerates with no interest in the well-being of the local communities. If large out-of-region corporations don't want to service a particular market, tell them goodbye and replace them with local businesses.
On a side note, there are numerous attorneys who used to make a pretty fair amount of income from real estate transactions who would probably welcome the extra work, even at State-mandated rates, to help support this plan.
It's about time that eminent domain powers were actually put to use truly in the greater interests of the community, rather than in the greater interest of the trans-national conglomerates.
I also want to make it clear; I am NOT suggesting replacing current cash-paid State employees with public labor. This is about expanding State services without ADDITIONAL cash outlay, and bringing current State employees additional support staff, and primarily, tackling the real estate market problems created by wrong-headed federal and trans-national corporate policy.
All the best, if you work and vote for it,
Dan
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