BLOG VIEW: This year's presidential election seemed like an eerie replay of the 2004 race: an unpopular president with a dismal record who managed to keep his job due, in large part, to having the good fortune of facing a charisma-free Massachusetts politician that the public was unable to love.
For better or worse, we have another four years of the Obama administration. But second presidential terms are rarely an opportunity for an incumbent to springboard to new heights of greatness. Just look at the examples of the past four decades: Richard M. Nixon was forced out of office less than two years into his second term, while Ronald Reagan and Bill Clinton saw their respective legacies badly tarnished in scandals. And, of course, our current economic condition had its roots in the second go-round for George W. Bush.
What kind of presidential leadership can we expect in the next four years? At this point, it is hard to predict. After all, the Obama of 2008 was an articulate, energetic, inspiring force of energy – but following the January 2009 inauguration, that individual was promptly replaced by an aloof and elusive chief executive that seemed to have significant problems communicating with the public and negotiating with power brokers of Capitol Hill.
Granted, the GOP leadership in Congress did everything short of throw banana peels under the president's feet in order to obstruct his attempts at progress. But, as they say in dance school, it takes two to tango – and the president's attempts to maneuver through the political environment could charitably be described as incompetent.
During this year's presidential campaign, Obama reinvented himself yet again – this time, as a cynical, sarcastic, zinger-happy politician who seemed to spend more time denigrating his opponents instead of pointing to irrefutable evidence of his administration's successes. This can partly be excused as a reflection of the times – Obama had very little to boast about, especially in regard to housing policy, while the Romney campaign had become such a gaffe generator that ‘Saturday Night Live’ half-jokingly credited Romney's clumsy campaigning as being Obama's secret weapon for re-election. The surplus of idiot Republican candidates that kept bringing up the subject of rape-related abortion certainly helped to alienate independent voters that briefly considered supporting the GOP, if only for economic issues.
So, which Obama persona will emerge for his second term, especially in regard to shaping housing policy? I suspect there will be an indifferent leader who will take a profound hands-off approach to the subject. To his credit, Obama has acknowledged that his initial attempts at handling the foreclosure crisis failed. Unfortunately, his Plan B was a continuation of Plan A.
At the moment, the administration isn't even driving the subject of housing finance. Edward DeMarco, the acting director of the Federal Housing Finance Agency (FHFA), and Richard Cordray, director of the Consumer Finance Protection Bureau (CFPB), are the unelected bureaucrats who have the fate of housing finance in their hands. And, of course, Federal Reserve Chairman Ben Bernanke has been powering his magical money machine with QE-Forever to ensure that someone is buying all of those mortgage-backed securities.
But the administration has been planting stories in certain media outlets that it is eager to oust DeMarco (who has been ‘acting’ director for more than three years) as soon as possible, while Cordray will probably exit Washington at the end of his term in 2013 in order to run for governor of Ohio. Bernanke has reportedly made it clear that he will not consider another term. I believe that the respective replacements for these three gents will obviously adhere to the Obama mantra of big-government-is-good-government and the idea that the mortgage banking industry was solely responsible for the 2008 economic meltdown. And, most likely, they will require recess appointments in order to get around the obstructionist elements in Congress. (Besides re-electing the president, the voters kept the divided partisan power structure in place on Capitol Hill – smart move, America!)
Ultimately, the fate of housing is tied to the fate of the economy. I am not among those who believe that housing fuels the economy – I believe that housing is a reflection of an economy, and you cannot have a healthy housing market when the economy is wracked with uncertainty. And with unemployment remaining too high for a comfort and the still-unresolved ‘fiscal cliff’ issue looming, there is a good chance that the country will slip back into recession next year.
Still, I wish the Obama team luck for the next four years. After all, his failure would ultimately bring everyone back into wreckage, and the very last thing this country needs is four more years of White House-orchestrated misery.
– Phil Hall, editor, MortgageOrb
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