Pennsylvania Leader Introduces
LaRouche Measures on Mortgage Crisis
To Pennsylvania Legislature
September 21, 2007 (EIRNS)The Lyndon LaRouche Political Action Committee (LPAC) issued the following release today.
Pennsylvania Rep. Harold James is gathering support in that state's legislature, now in session, for a state resolution to Congress calling for immediate, emergency Federal action on the principles of Lyndon LaRouche's Homeowners and Bank Protection Act 2007. Three states now in legislative session have such legislative resolutions, with others expected to join in demanding a Congressional action to halt the mass foreclosure wave across the country. In addition, individual elected officials from several other states have endorsed a petition to Congress for this action. Here is the Pennsylvania resolution.
Memorial Resolution to the U.S. Congress for
Emergency Action to Protect Homeowners and Banks
Whereas, the onrushing financial crisis involving home mortgages, debt instruments of all types, and the banking system of the United States, threatens to set off an economic collapse worse than the Great Depression of the 1930's; and Whereas, millions of Americans are faced with foreclosure and loss of their homes over the coming months, and
Whereas, the hedge funds which spread this financial collapse among markets worldwide, by dominating speculation in all those markets, are now going bankrupt and demanding government bailout of their securities and derivatives, and the nominal value of the derivatives based on mortgages alone is the size of the combined GDP of the nations of the world;
Whereas, this financial crisis threatens the integrity of both state and federally chartered banks, as typified by the run on deposits of Countrywide Financial Corporation in California on August 16, which could wipe out the life savings of too many American people, and drastically undermine the economic stability of our states and cities; and
Whereas, under similar circumstances in the 1930's, President Franklin D. Roosevelt successfully intervened to protect banks and homeowners, addressing Congress with a "declaration of national policy" on April 13, 1933, which stated "that the broad interests of the Nation require that special safeguards should be thrown around home ownership as a guarantee of social and economic stability, and that to protect homeowners from inequitable enforced liquidation in a time of general distress is a proper concern of the Government";
Therefore, Be it Resolved, that the House of Representatives of the Commonwealth of Pennsylvania calls upon the U.S. Congress to take emergency action in the form of a Homeowners and Bank Protection Act of 2007, as proposed by economist Lyndon H. LaRouche, Jr., specifically to:
- Establish a Federal agency to place Federal and state chartered banks under protection, freezing all existing home mortgages for a period of time, adjusting mortgage values to fair prices, restructuring existing mortgages at appropriate interest rates, and writing off speculative debt obligations of mortgage-backed securities, financial derivatives and other forms of financial pyramid schemes that have brought the banking system to the point of bankruptcy;
- Declare a moratorium on all home foreclosures for the duration of the transitional period, allowing families to retain their homes. Monthly payments, the equivalent of "rental payments", shall be made to designated banks, which can use the funds as collateral for normal lending practices, thus recapitalizing the banking system. These affordable monthly payments will be factored into new mortgages, reflecting the orderly deflating of the housing bubble, the establishment of appropriate property valuations, and reduced fixed mortgage interest rates. While this shakeout may take several years to achieve, in the interim period no homeowner shall be evicted from his or her property, and the Federal and state chartered banks shall be protected, so that they can resume their traditional functions, serving local communities, and facilitating credit for investment in productive industries, agriculture, infrastructure, etc.
- Authorize Governors of the several States to assume the administrative responsibilities for implementing the program, including the "rental" assessments to designated banks, with the Federal government providing the necessary credits and guarantees to assure the successful transition.
And Be It Further Resolved, that a copy of this resolution shall be forwarded to each member of the Pennsylvania Congressional delegation, and also to the President of the United States, for immediate action.