Katrina was a disaster, made worse because the United States Government failed the people. As we watched our government appeared to be unwilling or unable to initiate solutions quickly for those people in trouble.
The U.S. foreclosure crisis is a KATRINA of another sort. The Federal Reserve predicts that 2,250,000 foreclosures will occur before the end of 2008. 78,000 new foreclosures happened in November alone. In Maryland, the number of foreclosures grew by 35% in the third quarter of 2008, compared with the previous quarter. Thousands of families are displaced.
U.S. taxpayers will own millions of foreclosed homes
All of this, in spite of taxpayers having spent One-Trillion dollars to "rescue" our economy. It seems now, that most of this "rescue" has been for rich Wall Street bankers, brokers, and speculators.
Furthermore, these banks, that have gotten billions of taxpayer money, are paying bonuses, resort vacations and higher salaries to the very executives who managed this economy into the ditch. Coincidentally, the banks and firms that made the largest contributions to their "political friends" got most of the funding.
A HUD program designed to help 400,000 homeowners, to refinance their mortgages, into affordable government-insured loands has been funded with $300,000,000.000 (Billion). Yet, nationwide only 200 people have applied, because the underwriting standards are so complicated and difficult. Of the 400,000 homeowners, and of the $300,000,000.00 that we the taxpayers have provided to help these citizens, not one loan has been funded or approved by HUD as of this date.
It is no wonder that every day Americans are upset. Everything that we have been told about the "bail out" to save "Main Street" has been ineffective, not implimented, or has gone to help a few rich and powerful banks, on "Wall Street". CitiBank, for example, got $25,000,000,000. Yet, there are reports that instead of lending the money to help the economy, they invested it, and gave their executives and managers raises. Wells Fargo, Merrill Lynch, AIG, and many others have gotten billions and billions of taxpayer funds, and instead of using the funds for distressed homeowners, or Main Street, are using the funds in ways that should make every Congressman, Senator, and taxpayer fume with anger.
Sheila C. Bair, Chair of the Federal Deposit Insurance Corporation, has tried without success to get the White House and Treasure Secretary Henry Paulson to resolve mortgage problems of 65,000 customers of Indi Mac (a failed bank taken over by the FDIC). But the White House has blocked her attempts to help 1.5 million borrowers and to reduce the oversupply of homes. Just like with KATRINA, Washington, is allowing these people to "drown" financially.
Henry Paulson, who was an executive on Wall Street before being appointed Treasury Secretary, by George W. Bush, has directed most of the taxpayer money to help former friends, associates, and Wall Street companies that he has worked with and around for decades.