Silence Equals Consent

By Moe Bedard

While a few stalwart senators tried to battle for the passage of the cramdown bill last week we heard a number of important opinions, both pro and con, regarding the proposed power of bankruptcy judges to reduce principle balances on home loans. It appeared obvious to me and a great deal of other advocates of Main Street’s interest that the passage of the bill would have given Main Street some real relief and control over the housing crisis. However, big business and the banking industry made it clear that the passage of the bill would forever harm the industry, tighten lending policy and increase interest rates for the average American. Of course lobbyists threw around their power in the senate and ultimately our representatives ended up parroting their concerns in the most agreeable of rhetorical terms. One holdout on the debate was the Office of the President.

What strikes me as odd is that the President spoke on every possible topic during his first 100 days in office that seemed remotely related to improving the economy from green industries, to improving the possibility for college students to more affordably obtain student loans. My question is why the president did not put his opinion of the cramdown bill in to the ring of public debate?

From The New York Times:

The Obama administration sat by last week as 12 Senate Democrats joined 39 Senate Republicans to block a vote on an amendment that would have allowed bankruptcy judges to modify troubled mortgages. But when the time came to stand up to the banking lobbies and cajole yes votes from reluctant senators — the White House didn’t. When the measure failed, there wasn’t even a statement of regret.

Even if lenders do agree to modify loans, many Americans will still be in trouble. That’s because nearly 14 million homeowners are “under water” — they owe more on their mortgages than their homes are worth.

In debate as in politics silence equals consent in my opinion. The only reason why the President may not have made a great deal of statements to either support or attack the bankruptcy cramdown bill is because, perhaps, he perceived the bill as a dead end from the start or, even worse, because he, like most of the other politicians in the senate have been influenced by Washington politics as usual and the power of the lobbyists from the banking industry. His lack of statements as reported in The New York Times, in my final analysis, equals consent with the banking industry and the rest of the politicians that really don’t want the cramdown bill to go anywhere.

Tagged as: Bankruptcy, Cramdown Bill, democrats, foreclosures, loan modificatiion, mainstreet, making home affordable, obama foreclosure plan