A story in Politico on the deal with the banks and HUD Secretary Donovan’s role is worth a read.
I have a lot of doubts about the deal the Obama Administration worked out with the banks not being able to produce the type of relief needed, but at least HUD is finally asserting itself on behalf of homeowners.
Here is an excerpt…
Expect to see more of Shaun Donovan between now and November.
The U.S. Department of Housing and Urban Development, which Donovan has run since the start of the Obama administration, has been a backwater of corruption, cronyism and ineptitude in the worst stretches of its history — and outgunned and overshadowed by the Treasury Department more recently.
But Donovan, a boyish former New York housing official, is gaining substantial new leverage within the administration and a seat at the grown-up’s table, thanks to his deft drafting of a landmark $20-plus billion mortgage fraud settlement announced this month — and the election-year reality that President Barack Obama needs to show progress on the housing crisis, and fast.
In fact, Donovan’s preferred approach to solving the worst housing meltdown in U.S. history — forcing banks to write down a relatively modest amount in mortgage principal to help out homeowners — won out over initial objections of Treasury Secretary Timothy Geithner, a boogeyman to many liberals who think he’s been too soft to punish the One Percent.
“Something really changed [in the White House] after ‘Occupy.’… Shaun was a lot more empowered to make a deal,” said New York Attorney General Eric Schneiderman, who wrangled with Donovan during months of negotiations between 50 state law enforcement agencies, HUD, the Justice Department and five of the nation’s largest banks.