Bringing UP the REAR: Douglas W. Elmendorf, PhD, Director of the Congressional Budget Office

by 14 May 2012

(TheNicheReport) -- I’ve been writing this column every month for… I don’t know… it has to be three years now, or darn close.  And as those that read it know, I select an individual each month and basically call him or her out for being a “rear end,” or a jackass, if you prefer.  It’s not a particularly difficult task; unfortunately, it seems that buttheads are ubiquitous these days.

But, usually I manage to chastise my victim using humor… and if that’s not possible, I can always fall back on prose laced with a heavy dose of sarcasm.  In point of fact, I’ve become fairly well known for my use of sarcasm in such columns.  Just today, for example, I was on the phone with a fairly senior member of the Obama Administration… someone who works in a senior policy position at Treasury but shall remain nameless… and during that conversation I was told that my article one month last year “really pissed off my son.”

I apologized… said that it wasn’t meant to be personal, and that I had no plans to do anything like it again.  “Don’t worry, you’re only a ‘REAR’ once,” I explained.

A few months back was a real challenge, however, when my chosen REAR was Edward DeMarco, acting director at the FHFA, the conservator for the spectacular failures that are Fannie and Freddie… the GOEs, I call them - “Government Owned Entities.”  It wasn’t hard to choose him, he’s a mammoth REAR END, to be sure.  But, it was impossible to be funny, and my best shot at sarcasm was to suggest that “the DeMarco problem,” could be easily handled by simply shooting the man at dawn.  That came across as being sarcastic, right?  I’m pretty sure it was intended that way….

I mean, DeMarco’s well-publicized obstinacy related to Fannie and Freddie doing more to mitigate the carnage being caused by the foreclosure crisis is nothing short of maddening.  For one man to be the proximate cause of so much human suffering, well… he should have to be a despotic monarch.  And when you consider the fact that Fannie and Freddie are zombies, as companies go -  bankrupt… insolvent… ruined beyond all hope - it’s not like holding out is accomplishing anything positive.  It’s simply a case of taxpayers foreclosing on taxpayers, and therefore decimating the accumulated wealth of American taxpayers. 

It’s truly crackerjack work, no question about it, and assuming you’re working with
a fully developed adult human brain, it should make you want to chew on glass or lay down in traffic.  That President Obama is helpless and DeMarco’s power reigns supreme, well… don’t get me started.

The point is… it’s not the least bit humorous.  In Oceanside, California, just during the last four weeks, there were 14 foreclosure-related suicides and murder-suicides, and six of the dead were children.  Are you laughing?  Me either.

So, this month I’ve chosen the Director of the CBO, Douglas W. Elmendorf as the REAR, and if you don’t already know what’s driving my choice then you may want to stop reading now, and go do something else… because what you’re about to discover is flat-out repulsive… no, worse than that - treasonous?  I don’t want to come off as being too extreme, but...

You see, Lan T. Pham, PhD, who was a “senior staffer financial economist” at the CBO, and who was fired after less than three months on the job, went public with some of the details of her experience working for Mr. Elmendorf after her dismissal by writing a letter to Senator Grassley, the Ranking Member of the Senate Judiciary Committee. 

In that letter, Lan explained that during the fall of 2010, while working at the CBO, she was told not to publish or incorporate any data about the U.S. housing and mortgage markets… nothing about the foreclosure crisis, nothing that might spoil the CBO’s “forecasts,” and I use that term extremely loosely.

Here’s what Pham said that she was told in no uncertain terms by CBO leadership, among many other equally damning things…

  • Statements could not be made attributing the decline in property tax revenues to foreclosures and the decline in home prices.
  • Foreclosures had no impact on U.S. home prices.
  • The decline in home prices had no impact on U.S. household wealth.
  • The emerging foreclosure fraud problems in September 2010 were due to “media sensationalism,” and “the kind of event of the moment where we should be adding skepticism,” and “not just repeating the hype in the press,” and discussing it “lacks judgment about what is important.”
  • “Alternative viewpoints are suppressed or questioned as ‘pessimistic’ by CBO Director Doug Elmendorf.  Economic facts inconvenient to the CBO's forecasts of economic growth, recovery and other estimates are omitted or suppressed so the desired message may be delivered.”
  • And finally, the implications have profound financial and economic consequences that would be of compelling interest to Congress, and the public, but the CBO sought to silence a discussion of such risks that in reality have been materializing.

Okay, so this doesn’t need any further qualification… you did it… in your role as Director of the Congressional Budget Office, you deliberately withheld and even masked and knowingly distorted information vital to the current and future wellbeing of the United States of America during the most severe and damaging national economic emergency since the 1930s.

You lied to Congress, if only by omission.  You withheld critical information from the President of the United States, or at least I’m going to pray you did, because if you didn’t… if your conspiracy to see this country’s economy so substantively disrupted as to become utterly destroyed, with trillions of dollars in middle-class wealth eviscerated to such a degree that there is no hope for it to return in my lifetime, actually involved the White House, well then… Dear God, sir… what have you done?

What have you done to lives of hundreds of millions of Americans citizens… to the elderly, the destitute, to those too young to be able to speak out or defend themselves - to say nothing of what your suppression of information has done to untold numbers of people around the globe?

Do you not realize how many lives you’ve destroyed by your actions… how many have taken their own lives because of what you’ve done in your capacity as director of the CBO?  How many are today being forced to grow up without mothers and fathers because of what you engineered and accomplished?

As someone who, during this exact period of time in this country’s history, has devoted almost all of my time… seven days a week, and more often than not 16 hours a day… to writing about these facts as you worked to keep them concealed, you have robbed me and my family personally of hundreds of thousands of dollars.  When I think of how many times I was asked why our government wasn’t saying what I was saying in countless articles… “they had to know,” people asked almost daily… “why is it that they do not say a word?”...

I am physically sickened by what you have done, by what you have allowed to happen. You, a graduate of Princeton with an undergraduate degree in economics, a Masters in Economics and then a Doctorate in Economics, the last two degrees from Harvard?  You cannot claim ignorance or feign indifference. 

I suppose I’ll never know who else was involved in what you’ve done to this nation by manipulating and withholding such information from Congress, from the president, from the American people and from the world.  You are a traitor to my country.  You should be incarcerated for the remainder of your life at a minimum… were it up to me, you would be tried and held accountable.

And even as you saw the impact of your decision to withhold information grow and continue to do harm to the Obama presidency… even as you saw the economic conditions worsening so dramatically, you just turned your back on tens of millions who today live on food stamps and with no hope of employment for years to come?  Beg this country’s forgiveness, and pray for your soul.
 

Martin AndelmanMartin Andelman is a staff writer for The Niche Report. He also writes an almost daily column on ML-Implode called Mandelman Matters. He also publishes a Monthly Museletter and you can follow “Mandelman” on Twitter. Send your responses to Martin@TheNicheReport.com.

COMMENTS

  • by Dave | 8/27/2012 11:27:40 AM

    Wells Fargo Insiders Detail Foreclosure Fraud Practices: ‘It’s Exactly Like An Assembly Line’
    By Travis Waldron on Apr 20, 2012 at 11:55 am

    That Wells Fargo has fraudulently processed mortgage documents using a process called robo-signing has been evident for nearly two years, since scandal enveloped the mortgage industry in 2010. That it kept doing it even after the scandal broke has been known for months. The practice, at Wells Fargo and other Wall Street banks, has led to waves of improper foreclosures and a $25 billion settlement with the federal government and state attorneys general.

    A new report from MSNBC, however, provided an inside account of how Wells Fargo’s robo-signing department works. Unqualified employees with salaries ranging from $30,000 to $50,000 are given titles like “vice president of mortgage documentation” so they can sign foreclosure documents. Actual supervisors institute quotas on employees, forcing them to sign a certain number of foreclosure files each day — sometimes telling them they can’t eat breakfast or take lunch until they’re done. Documents required for homeowners to avoid foreclosure were ignored, left sitting on an unattended fax machine.

    The result: the nation’s largest mortgage servicer often improperly foreclosed on homeowners who weren’t past due or owed little interest while pushing the files out the door as fast as possible, as an insider told MSNBC:

    Some families apparently were denied mortgage modifications after only cursory interviews, she said. Other borrowers applying for help sent comprehensive personal financial documents to a fax machine that she discovered had been unattended for weeks. Others landed in foreclosure after owing interest payments of as little as $1.18 a day, according to documents she said she reviewed. [...]

    “There was one file where they weren’t even past due and they were in foreclosure status,” the mortgage processor said. “They’re pushing these files and pushing these files….”

    The MSNBC report comes just a month after a similar report from the inspector general of the Department of Housing and Urban Development, which found many of the same occurrences at Wells Fargo. In that report, Wells Fargo allegedly put an employee who had previously sold pizza in charge of mortgage documentation. Worse yet, the report found that executives at the banks knew about the practices and refused to stop them.

    Higher-ups at Wells Fargo, however, are still denying that these abuses take place. “No one here is asked to sign anything they don’t understand. Period. End of story,” Michael DeVito, executive vice president of Wells Fargo’s Home Mortgage Default Servicing, told MSNBC. “There’s no production quota and if a team member says, ‘I don’t understand this I’m not going to sign it,’ that’s fine.”

    Another Wells Fargo employee had a different account. “It’s exactly like an assembly line,” a mortgage processor told MSNBC. “You sign it, you push it off to a notary, they stamp it, you put it in a box and it goes somewhere else.” The next step, unfortunately, is that someone loses their home.

  • by William Matz | 8/28/2012 11:52:27 AM

    The forecgoing comments are quite consistent with what my clients have been experiencing with WF. One WF employee actually claimed that the owner had been advised of reinstatement rights by a WF letter that was mailed AFTER the foreclosure.

    Not only have the banks/Wall St refused to accept responsibility for setting up the reckless structure that set off the crisis, but now they compound the problem by systematically violating foreclosure laws, most likely to try to cover up as much of their misconduct as possible.

Poll

Is TILA-RESPA a good or bad thing long term?