Peter S. Goodman, Huffington Post
The time has long since arrived for Edward J. DeMarco to pursue his other opportunities in the private sector, whatever they may be.
DeMarco, you may recall, is acting head of the Federal Housing Finance Agency, the government entity that oversees Fannie Mae and Freddie Mac, the pair of gargantuan mortgage companies that collectively own or guarantee most of the nation’s home loans, giving them outsized influence over the American economy.
For many months, evidence has mounted that the most expedient way to move the country past the slow motion agony of the foreclosure crisis is to forgive substantial loan balances for the millions of homeowners who are underwater, meaning they owe the bank more than their homes are worth. The Obama administration finally wants this to happen, after opposing this approach early on. Housing experts have been calling for this course for years.
Yet almost single-handedly, DeMarco has prevented this from happening on a large scale. He has refused to allow Fannie and Freddie to engage in principal reduction while ordering upintellectually dishonest analysis purporting to show that taxpayers are best served by the existing assortment of policies — a course that has produced blight, dislocation and economic stagnation.
DeMarco has held the line because he cares more about the principle — in this case, the supposedly sacred obligation of debt repayment — than about the societal consequences of too much principal. As I have written here before, DeMarco is a bleeding-cash conservative, an ideologue so keen on punishing those he views as morally derelict — people who can no longer pay their bills — that he is willing to squander taxpayer dollars toward ensuring that they suffer the ultimate penalty: relinquishing their homes.