The Wall Street Journal lashed out at Massachusetts Attorney General Martha Coakley on Wednesday in their editorial section for her suit against the big banks and their foreclosure practices.
The piece was ripe with misinformation and the usual sucking up we've come to expect from a publication that has its nose buried so far between the cheeks of the financial industry that it can't see the light of day, much less accurately assess the situation.
It almost seems pointless to rebut this editorial and I was tempted to walk away in much the same way that I do when someone tells me that this whole housing mess was caused by Democrats forcing banks to loan poor people money -- it's not worth my time anymore. The WSJ piece starts out with the following paragraph:
"It's been four years since the housing bust began, and some Democrats are fighting to keep it going. That's the message out of Massachusetts, where Attorney General Martha Coakley is layering on more uncertainty for the mortgage industry with a lawsuit that's already driven one company to roll back its business in the state."
The company in question is GMAC, who after hearing of Coakley's suit, announced that they would be pulling out of Massachusetts. An announcement that can best be translated as, "If we're going to have to obey the rules, then we're not going to play here anymore." That the editors at the WSJ can't see that is perplexing.
The editorial points to the 50-state settlement headed by Iowa Attorney General Tom Miller as a viable solution. The settlement has become a running gag among homeowner activists, and was addressed aptly by Yves Smith at Naked Capitalism, "But the truly absurd part is the continued pretense by Miller that a deal will get done. He's been saying every few weeks that a deal is weeks away for over a year. In early August, a deal was supposed to be inked by Labor Day. Earlier this month, Miller said a deal would be done by Christmas."
It's important to mention that the settlement represents a tiny fraction of what the banks took from homeowners and absolves them of any wrong doing. It also would prevent any of the states from charging or prosecuting banks and servicers for breaking the law at the expense of homeowners.
As I said in an interview on Boston Revolution Radio, "If I had to give up 10 percent of my loot every time I got caught robbing a house, I'd not only continue robbing houses, I'd hire a crew."
The editorial ends with the following statement:
"America's housing market can't recover until banks are allowed to foreclose on delinquent homeowners and resell those homes to people who can afford them. Ms. Coakley's lawsuit will delay that process, raising the cost of credit, reducing choices, and prolonging the housing recession."
AG Coakley's lawsuit isn't delaying the foreclosure process in Massachusetts. The law is delaying the process. Cases such as Ibanez and Bevilacqua, ruling that banks must prove ownership before foreclosing have all made their way to the Massachusetts Supreme Judicial Court.
Foreclosures are ruining the economy on their own, not the backlog of foreclosure cases. Foreclosures cost hundreds of thousands of dollars, break up communities, threaten public safety, destroy property values, and are the cause of mental and physical illness. The editorial is intentionally misleading by putting this on Coakley, who is quite simply doing her job by following the law.
Recently, Danny Schecter wrote a piece for Al Jazeera English, titled, "The year's top story is not getting coverage" in which he chastised the American press for their shoddy coverage of the financial crisis and those culpable in creating it:
"... The barely exposed chain of criminality that started in some salon of securitization and then rippled across the world, bringing down countries and economies. It has its origins in Wall Street, where three industries colluded as a cabal to sell fraudulent sub-prime loans and then transfer fees and foreclosures from poor and middle class Americans to themselves."
The WSJ editors (the piece had no byline) seem to think that in order for things to get better, we should excuse the big banks from breaking the law and wreaking havoc on American families. Maybe we should excuse murderers and bank robbers as well, because their mothers would miss them.
Attorney General Martha Coakley along with Essex County Register of Deeds John O'Brien, and a handful of attorneys and judges in Massachusetts are among the few in the country to stand up and hold the banks accountable for their rampant disregard for the law. If anything, Coakley should be commended for her integrity and willingness to do her job. Instead, the Wall Street Journal and its editors see fit to chastise her and anyone else who would hold those who caused the financial meltdown accountable.
Check out my pre-holidays interview on Al Jazeera English.
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