“There are some people in the Republican Party who resent the idea of helping others. But the market is broken right now, and unless we intervene, these people and the economy won’t be helped.”
— FDIC chairwoman Sheila Bair in today’s New York Times. The voice in Washington for millions of homeowners facing foreclosure, Bair insists that economic recovery depends on their rescue, financed by billions in taxpayer dollars. As the Times story explains, Bair’s campaign has incensed the White House and Treasury officials. They accuse her of self-promotion and claim that her $24 billion plan to help 1.5 million borrowers would actually come in at nearly $70 billion and result in more people redefaulting than the FDIC has acknowledged.
This week brought news that more than half of at-risk borrowers whose loans were modified by banks like JPMorgan Chase, Citigroup and Bank of America, had already redefaulted. Bair blamed sloppy loan modifications. “The FDIC has been working on loan modificiations for 20 years. I’m frustrated that nobody gives us any deference for knowing how this stuff works,” she said to the Times. For more on Bair, read this column by Coins2Day writer Betsy Morris.