The Win-Win Solution: How Fixing The Housing Cover.jpgCrisis Will Create 1 Million Jobs
America is more than three years into an economic crisis that shows no signs of abating. One in 10 Americans cannot find a job, one in five owes more on their mortgage than the home is actually worth, foreclosures continue to set a record pace, and family-owned small businesses are once again shuttering their doors as prospects re-emerge of even tougher times ahead. More and more Americans are losing faith in what has long made this country great – the belief that they can create a better life through hard work.
But the banks can do something right now to change all that. By writing down all underwater mortgages to market value, the nation’s banks could:
• Pump $71 billion into the economy every year;
o In New York state the annual stimulus would equal $1.25 billion
o In Ohio, $1.64 billion
o In Florida, a staggering $12 billion
• Create more than one million jobs annually;
o In Massachusetts this would create over 35,000 jobs
o In Illinois nearly 43,000 jobs
o In California, over 300,000 jobs
• Save families an average $543 per month on their mortgage payments;
• Help investors come out ahead compared with the negative financial impact of foreclosures
• Fix the foreclosure crisis once and for all.
The overhang of underwater mortgage debt is one of the primary drags on economic recovery. It continues to devour tens of billions of dollars annually, money that would otherwise go into our economy in the form of consumer spending.
This increase in consumer demand would in turn help spur job creation and increase revenue for governments that have seen their tax income plummet as a result of the downturn.
To date, foreclosure prevention efforts have focused on making the banks whole for a period of time while doing little to fundamentally restructure and reduce the debt load carried by homeowners. !e underlying assumption in this model – that if we wait it out, then things will get better – is not only flawed, but is actually worsening the pain for millions of families and continuing to undermine long-term prospects for a housing recovery. We need aggressive action now that creates a New Bottom Line for American homeowners.
The banks have it in their power to restore the American Dream of homeownership that helps build wealth for families. What’s more is that we have already paid them the money to do it. American taxpayers came to the banks rescue with trillions in bailouts and backstops and now it is time for the banks to begin to undo the damage they caused and give back a working economy.
Full report below…
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