Maxine Waters is a member of the United States House of Representatives, serving
California's 35th Congressional District since 1991. As a member of the House
Committee on Financial Services and the Chairwoman of its Subcommittee on
Housing and Community Opportunity, Congresswoman Waters is well positioned to
discuss current economic conditions and solutions to the crisis.
Here is my interview with Congresswoman Waters.
Kathleen Wells: President Obama has recently completed his 100th day in office. Give us your assessment.
Congresswoman Waters: I'll be happy to give you my assessment of President Barack Obama's 100th day in office. I join with most of America in giving him an
"A."
The polls are all showing that Americans not only support him, but believe that he has
done a good job. Most of the pundits, Democrats, Republicans and Independents, are
complimenting him on the way that he is conducting himself since he has been in
office.
And his "A" from me comes because he has done well on the domestic agenda. He
has worked well with Congress. He has signed into law several very important bills,
including the health care bill for children, which covers 11 million children who had
no healthcare insurance. Also, the Lilly Ledbetter Bill, which really speaks to equal
pay for equal work and has been an issue that has plagued us and plagued women for so long.
He also has the courage and the vision to step up to the plate in the middle of an
economic crisis and get signed into law a stimulus package to stimulate jobs and give
support to cities, states and counties. Not only to create jobs, but to help rebuild
our infrastructure. The stimulus package is a 787 billion dollar package that is
designed to make this economy come back to life again. And to grow the economy;
creating jobs and assisting families in many ways, including with education and
health.
And I'm very excited about the energy portion of the package, which will create the new green jobs. That will cause us to do retrofitting and to use alternative sources of energy. All of this is very important work. And I can't say enough about the approach to help to make us a green America and create clean energy jobs.
It is a very exciting time.
When you look at both his domestic and international agenda, you can certainly say
he has been successful on the international front. He has rebuilt confidence in
America. His trip to Europe was absolutely spectacular. Not only do they love him,
they love the new possibilities that he brings.
He stepped up to the plate right away and closed Gitmo and let it be known that he
would not allow prisoners that were in our possession to be treated in a way that the Bush Administration obviously had condoned.
So he has done a good job and he deserves an "A." And I think it is very important
for all of us to get behind him and help him move [on] the next agenda [item] of comprehensive universal healthcare. And on education, we must ensure that our young people are graduating from high school and going on to college and make sure that the college loans are credible and that families can afford to send their kids to college -- that we are not simply subsidizing the banks in giving these loans.
He inherited a horrible situation with this economic crisis, but he has not flinched.
And his confidence inspires us and helps to generate confidence because we see him
carrying on.
Kathleen Wells: You mentioned the banks and I know that the stress test was recently released and that it is being reported that 10 of the major, large banks require an infusion of additional capital, either by privately raising the funds, converting shares or coming to Congress. Your thoughts?
Congresswoman Waters: If the banks need to come to the Congress for a second
round, it will not be easy. It will not be given easily.
First of all, the banks did not spend the money the way that we thought they would
spend it. They did not loosen up the credit the way it had been envisioned. Some
banks were reported to have even gone out and bought other smaller banks. So, we
have to look at everything, from the compensation of top management -- the bonuses. The way this money has been spent.
If the banks come back to Congress for additional capital, the President is going to have to be able to convince the American public that he has confidence that infusing the banks with more dollars is going to stabilize this economy and avoid a meltdown. So, it's not going to be easy if they come back.
Kathleen Wells: In April, you were in Los Angeles visiting with a few of your constituents who are facing foreclosure. You introduced the Neighborhood Stabilization Program. Tell me about the program -- its goal, its purpose.
Congresswoman Waters: As you know, we have faced this horrendous foreclosure disaster in the country where millions of homes have been placed in foreclosure. People are not able to pay their mortgages for many reasons. Because of the economic downturn, many people have lost their jobs or they have had to take part-time jobs. They don't have as much income. Many of the loans that were out there were fraudulent. Many people got coaxed into loans that they could not afford by unscrupulous loan initiators. For all of these reasons, we have these foreclosures across the country.
In some communities, the foreclosures are devastating. Whole communities are being boarded up. When you look at some of the houses that are foreclosed on, they are not up kept by the cities because it's a cost to the city. They create problems for the fire department and the police department because oftentimes they are occupied by gangs or the homeless. The weeds grow up, the animals take them over. It starts to drive down the value of the other homes in the neighborhood. This is what you have: communities that are in decline and homes that are losing value even faster than the homes that are losing value because of the downturn in the housing market.
My bill was designed to try and stabilize these communities. What my bill said is look, city and counties, we are going to give you some money to buy up these houses, to rehabilitate them and put them back on the market. We are going to get you to come up with a program that can not only rehabilitate them, but in some cases, like in Los Angeles, make them more family friendly. There are still homes with two bedrooms and only one bath. In Los Angeles, we are adding baths. Where there is a lot of yard space and acreage, we may be adding another room.
We are putting houses back on the market and putting them back at a price that is affordable. We are putting people into solid mortgages that will be 30 and 40-year mortgages, rather than some of these ARMs (adjustable rate mortgages) that caused so many problems for people. That's how they are using the stabilization money.
Kathleen Wells: What can be done to help homeowners who are actually facing foreclosure now?
Congresswoman Waters: We are doing a lot of things. As you know, the President rolled out his plans for loan modification. In that plan, he has a way to help families with getting their loans redone, so that they can afford them.
In the loan modification plan, we get the loan initiator to write down interest rates. And in some cases, they are writing down principles -- stretching them out from re-setting loans or ARMs into 30 or 40-year loans -- which drops these payments, sometimes down 50-percent.
With the refinancing, we are getting FHA (Federal Housing Authority) in some cases to refinance the loan of people who may have a 30-year loan mortgage, but they have a loss of income, don't have as much money coming in and they need to reduce the cost. We are reducing their interest rates and that's causing them to reduce the amount of money that they are paying on their mortgages.
So, we do have plans in operation -- they are beginning to operate. And of course, we have all of the Fannie Mae and Freddie Mac loans, that have a strong modification program that is in force and they are holding most of the second mortgages on many of these homes. It is beginning to move.