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Steve Meacham and City Life/Vida Urbana
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December 18, 2009

The banks may be recovering from the near collapse of the financial system in 2008, but the foreclosure crisis is in full swing.

It's a disparity that has angered activists across the country and some leaders in Washington, D.C.

On Wednesday, December 9, the Congressional panel charged with overseeing TARP, led by Harvard Law Professor Elizabeth Warren, released its monthly report, and while it called the program successful at preventing a financial panic, the report criticized TARP for lacking focus and for not doing enough to halt the foreclosure crisis.

The report came out the same day that treasury secretary Timothy Geithner announced he would be extending TARP past its end-of-year deadline until October 2010, promising to focus efforts on preventing foreclosures. Home foreclosures have continued apace, and at the end of Septemb er, 14.4% of mortgage holders were in foreclosure or delinquent on their payments.

Only around 31,000 homeowners have received permanent loan modifications under the Obama administration's $75 billion plan. Lenders claim that the low success rate is the failure of borrowers to send in the necessary paperwork. But Paul Kiel, of ProPublica, reports that the mortgage servicers may be to blame, "the data from servicers should be viewed with skepticism, given another clear trend: Banks and other mortgage servicers are themselves not very good at managing documents."

City Life/Vida Urbana
Community organizer Steve Meacham of City Life/Vida Urbana is fighting on the frontlines of the foreclosure crisis. Meacham and his colleagues at City Life employ a community organizing strategy they call the The "shield" is a strategy of legal defense: teaching City Life members about their rights under the law, plus providing access to volunteer legal assistance. The "sword" is a public relations strategy, where City Life organizes protests in front of banks, and eviction blockades in front of people's homes. For these protests, City Life tries to attract as much media attention as possible, trying to draw public scrutiny towards what they argue are unfair banking and eviction practices in their community. "We find that the two [strategies] work extremely well in combination," says Meacham. He says that a strong legal defense often isn't enough to avoid eviction. "A legal defense is not enough because in Massachusetts the banks can evict you for no reason. And so for many people the strongest legal defense will simply slow the bank down. Slowing the bank down, however, can be very, very important because it gives us a chance to use the public protest to good benefit. If the bank is facing the prospect of a long, drawn-out legal procedure, even one that they might ultimately win.. and at the same time they're going through that, they're being regularly protested by City Life.. that is a public relations battle the bank loses every time. So faced with that combination of long, drawn-out legal defense and public protest, the banks are very often choosing to negotiate and settle with us." According to City Life, they've been able to prevent evictions for 95% of the people who've come to their door by employing the "sword and shield" strategy.

Meacham argues, as did John D. Geanakoplos and Susan P. Koniak in the NEW YORK TIMES, that a key solution to the foreclosure crisis -- one that's missing from President Obama's plans -- is the process of writing down the principal on many troubled homeowners mortgages to a more reasonable level. Meacham argues that the real estate bubble artificially drove up the value of many people's homes, and that their inflated mortgages should now accurately reflect the current, adjusted value of their homes. "One of the unheralded things about this crisis right now is that there's an awful lot of owners who come to us who cannot afford their home at the inflated value, at the adjustable rate mortgage price. But they have plenty of income to afford their home at the real value at a 30-year fixed. And so why not just give them the property back at that amount? If they're foreclosed on, the best the bank that can do is sell the property at the real value."

Meacham first came to community organizing via his work as a union welder at the Quincy shipyards in Boston, where he was a part of many labor struggles against the corporate owners of the shipyards.

Related Media:
James Thindwa
James Thindwa, whose campaign for economic fairness for working people in Chicago has brought him up against the city's powerful political establishment and corporate giant Wal-Mart.

Steve Meacham: Fighting Foreclosure
The JOURNAL profiles Steve Meacham, a Massachusetts community organizer fighting to keep working people in their homes.

American Dissidents
People who've made a difference in America — from Thomas Paine to Ralph Nader. (March 20, 2009)

Leo Gerard, photo by Robin HollandLeo Gerard
Bill Moyers sits down with United Steelworkers' International President Leo Gerard to discuss seeking economic justice for workers in the middle of an economic crisis and how he sees the future of American manufacturing. Gerard shares his thoughts on how unions will fare under the Obama administration, what kind of stimulus might be needed and what the future of American industry might look like. (January 9, 2009)

Andy Stern
The president of Service Employees International Union, the fastest growing union in the nation, weighs in on the growing economic gap between average families and the wealthiest Americans. (June 15, 2007)

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References and Reading:
President Obama's mortgage plan is administered by the Department of Housing and Urban Development (HUD). U.S. Department of Housing and Urban Development
HUD provides advice for homeowners facing foreclosure and other financial issues including important information on foreclosure scams. The site also has a good list of local resources for each state and lists HUD-approved housing counseling agencies all over the nation.

City Life/Vida Urbana
Boston-based group that aids troubled homeowners.

HOPE NOW is an alliance between HUD approved counseling agents, mortgage companies, investors and other mortgage market participants that provides free foreclosure prevention assistance.

The Center for Responsible Lending
The Center for Responsible Lending is a "nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices." The site includes and assessment of current legislation: HR 3915 Mortgage Reform and Anti-Predatory Lending Act.

National Foundation for Credit Counseling: Housing Counseling
The NFCC is the nation's largest and longest serving national nonprofit credit counseling network, with more than 100 member agencies and nearly 850 offices in communities throughout the country.

The Mortgage Bankers Association
The Mortgage Bankers Association is an association representing the real estate finance industry. The Web site includes a Q&A on mortgage banking and the crisis and assistance for owners.

Facing the Mortgage Crisis
Public TV station KETC has created an interactive site full or resources for people in the St. Louis area encountering mortgage problems.

"Protesters in Chicago March on Offices of Goldman, Wells Fargo"
By Lauren Etter, THE WALL STREET JOURNAL, October 27, 2009.

"Goldman Sachs amends pay practices to stifle criticism"
By Walter Hamilton, THE LOS ANGELES TIMES, December 10, 2009.

"Why Treasury Needs a Plan B for Mortgages"
By Gretchen Morgenson, THE NEW YORK TIMES, December 5, 2009.

"Change Wall Street Can Believe In"
by Holly Sklar, COMMON DREAMS, November 9, 2009.

"Debt Raters Avoid Overhaul After Crisis"
By David Segal, THE NEW YORK TIMES, December 7, 2009.

"Homeowners Getting Blame for Lack of Loan Mods, but Evidence Points to Banks and Servicers, Too"
By Paul Kiel, PROPUBLICA, December 9, 2009.

"Audit Finds TARP Program Effective"
By Jackie Calmes, THE NEW YORK TIMES, December 9, 2009.
Also This Week:
Amidst fading hopes for real reform on issues ranging from high finance to health care, economist Robert Kuttner and journalist Matt Taibbi join Bill Moyers to discuss Wall Street's power over the federal government.

The JOURNAL profiles Steve Meacham, a Massachusetts community organizer fighting to keep working people in their homes.

Bill Moyers lists his pick of the best books of 2009.

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