John Edwards 2008: What’s not to like

August 23, 2007

Financial Security Edwards’ Pitfall

Filed under: 2008 Primary, Financial Security, Hedge Funds, Housing, Poverty, Social Security — is @ 3:35 pm

Some issues like terrorism, health care and education are key topics from election to election, but signs are mounting daily that a new subject – financial security – will be central to next year’s presidential race.

Layoffs, mortgage anxieties and wild financial markets are now staples on the evening news, contributing to trepidation at a time when large majorities of voters have long said they believe the country is headed in the wrong direction.

Later today, AARP plans to release a “Divided We Fail” survey of a total of 5,000 of its members in five early voting states, and the data suggest that the candidates will be talking an awful lot about financial security, including savings, Social Security and pensions.

Half of those polled were Democrats and half of them were Republicans.

More than 9 in 10 of the potential caucus-goers or primary voters said financial security will be important to their votes, and between half and three-quarters called it “very” important. The survey is by Divided We Fail, a project of AARP, the Business Roundtable and the Service Employees International Union.

The poll covers New Hampshire, Iowa, South Carolina, Florida and Nevada, where AARP has a combined 4 million members. AARP will call attention to the results by holding events in each of the states on Thursday.

This seeming perfect storm of financial unease has already prompted some candidates and members of Congress to address the issue. Former North Carolina Sen. John Edwards has long made economic populism a central issue in his speeches and has a “predatory mortgages” policy.

However, the prominence of the issue has drawn attention his campaign did not want to a private equity fund for which he worked until last year. This week, The Wall Street Journal reported on 34 New Orleans homeowners who have faced foreclosure suits from units of the fund.

The Politico 8/23/07
http://www.politico.com/news/stories/0807/5485.html

May 11, 2007

Edwards Says He Didn’t Know About Subprime Push

Filed under: 2008 Primary, Financial Security, Hedge Funds, Housing, Poverty — none @ 12:25 pm

The hedge fund that employed John Edwards markedly expanded its subprime lending business while he worked there, becoming a major player in the high-risk mortgage sector Edwards has pilloried in his presidential campaign.

Edwards said yesterday that he was unaware of the push by the firm, Fortress Investment Group, into subprime lending and that he wishes he had asked more questions before taking the job. The former senator from North Carolina said he had asked Fortress officials whether it was involved in predatory lending practices before taking the job in 2005 and was assured it was not.

Snip: Largely as a result of the rise in subprime lending and the cooling housing market, home foreclosure filings rose to 1.2 million in 2006, an increase of 42 percent. At the same time, the drop in value of subprime lenders has presented a buying opportunity for investors such as Fortress.

Fortress hired Edwards as an adviser in October 2005, nearly a year after his losing campaign as Democratic vice presidential candidate. At the time, it owned a major stake in Green Tree Servicing LLC, which rose to prominence in the 1990s selling subprime loans to mobile-home owners and now services subprime loans originated by others.

Snip: Fortress’s growing role in the subprime lending market provides a second contrast between the firm’s business practices and the positions Edwards has taken as the presidential candidate who has made poverty a major campaign theme. The Washington Post reported last month that Fortress’s partners and its foreign investors benefited from the kind of offshore tax breaks Edwards has criticized as a candidate.

Last month, Edwards announced a plan to fight predatory lending. He said that an increase in subprime loans and predatory mortgages was resulting in a surge of foreclosures that risked “devastating communities,” and that shameful lending practices . . . are compromising our strength as a nation.”

Edwards said his role at a company with a growing stake in the subprime industry should not be seen as undermining his commitment to helping the poor. He noted that since the 2004 election, he has founded a poverty think tank, started a charity for poor college students and assisted campaigns to raise the minimum wage.

“If you put it in the context of all those things, it’s very clear where my heart is and where my commitment is,” he said.
Subprime loans have been particularly prevalent in New Orleans, which Edwards has made a focal point of his campaign. He formally announced his bid in a Katrina-ravaged neighborhood there and returned for a visit last week.


http://www.washingtonpost.com/wp-dyn/content/article/2007/05/10/AR2007051002277.html

April 1, 2003

2004 Positions on Housing

Filed under: 2004 Primary, Financial Security, Financial Services Modernization Act, Housing, Senate Voting Record — is @ 1:06 pm

Senator John Edwards is considered a strong presidential contender despite being a relative newcomer to politics. Before being elected to the Senate from North Carolina in 1998, he had held no prior political office. Edwards talks a great deal about “the real America” while campaigning but, like the other candidates, he rarely discusses how hard it is for “real Americans” to find affordable housing.

Edwards’ Web site makes no mention of affordable housing, and his campaign staff did not respond to several requests for information about the senator’s housing platform.

His legislative record shows that Edwards sponsored a “Rural Rental Housing Act” to provide funding through the Department of Agriculture for rural rental housing assistance to very low income families in communities lacking affordable rental housing. The legislation was never brought to a vote.

In testimony in support of the housing act, Edwards said, “There is nothing more important to a good life in America than good housing. And there is no problem in rural America larger than the shortage of affordable housing. For working families in rural America today, the shortage of affordable housing is becoming a crisis.”

To address the problem, Edwards took a fiscally conservative approach, saying, “We cannot simply throw money at the problem and expect the situation to improve.” He repeated the standard wisdom that the federal government must work in partnership with state and local governments, private financial institutions, private philanthropic institutions, and the private and nonprofit sectors.

Other than this bill, however, Edwards has had little direct involvement with housing issues in the Senate. When the Financial Services Modernization Act was passed in 1999, Edwards sat on the Banking Committee and was a strong supporter of the bill. He has not been a supporter of the National Affordable Housing Trust legislation.

Few contributors to Edwards’ campaign were from the housing industry-only Bank of America made it into the top 20. The real estate industry as a whole (PACs and individuals working in the industry) ranked number four on his list of industry givers in the 2002 cycle.

When the occasion warrants, Edwards’ rhetoric does seem to support the issue. “I think it is critical that [we elected officials] do everything in our power to provide affordable housing,” he remarked at the dedication of a Habitat for Humanity house in Chapel Hill, N.C.

“I would say that he’s well intentioned,” says Constance Stancil, executive director of the North Carolina Low Income Housing Coalition, “but recently he has shown little interest in or awareness of the major housing shortage faced by North Carolinians.”

Affordable Housing Finance 4/03
http://www.housingfinance.com/ahf/articles/2003/July/Dem_Candidates.html

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