As I was out doing my rounds today, I caught a very interesting story on the Thom Hartmann Show about one city in California that's using its power of eminent domain to assist struggling homeowners find relief for their mortgage woes. I wasn't able to find a link on Thom's website, but a quick Google search turned up a quite a few results. I'm short on time, so I encourage the reader to do a search as well. Here are two that cover the basics:
But now Richmond California, an impoverished city in the Bay Area where home prices have gone down not up, is strongly considering asserting eminent domain to seize homes from secondary lenders and re-sell them to their owners at current market value.
The best part of the story - as if helping hurting homeowners wasn't enough great news - is that two-term Richmond Mayor Gayle McLaughlin is using one of corporate banking's own tactics against them. Most stories we've seen recently have been about city governments using eminent domain authority to obtain private property to enrich a for-profit company and Supreme Court rulings have backed up this expansion of uses for the seized properties.
Well, Mayor McLaughlin is using those very rulings to back up her plan to assist the community in which she serves. Of course, the banks are resorting to threats to protect their 'turf'.
The banks have warned that such a move will bring down a hail of lawsuits and all but halt mortgage lending in any city with the temerity to try it.It's nice to see what happens when an elected official actually lives up to the ideal of what government is supposed to do for the people in the community.
But local officials, frustrated at the lack of large-scale relief from the Obama administration, relatively free of the influence that Wall Street wields in Washington, and faced with fraying neighborhoods and a depleted middle class, are beginning to shrug off those threats.
“We’re not willing to back down on this,” said Gayle McLaughlin, the former schoolteacher who is serving her second term as Richmond’s mayor. “They can put forward as much pressure as they would like but I’m very committed to this program and I’m very committed to the well-being of our neighborhoods.”
Way to go, Mayor McLaughlin!