A Word From John McCain [on Mortgages and the Economy

Op-Ed

A Word From John McCain

Trailwatch reached out to each of the remaining presidential campaigns and offered them an unedited forum in which they could address voters. Ron Paul was the first candidate to respond to our offer and John McCain has now followed suit. We asked each campaign to submit 500 to 1,000 words on the issue(s) they believe are the most important facing the nation at this moment in time. For McCain, that issue is the mortgage crisis and the financial strain it is creating for homeowners.

--Paul M. Murdock

America's families are bearing a heavy burden from falling housing prices, mortgage delinquencies, foreclosures and a weak economy. It is important that those families who have worked hard enough to finance home ownership not have that dream crushed under the weight of the wrong mortgage.

While addressing these issues, it is important to recognize that there is no substitute for faster economic growth. No government program is a substitute for the jobs provided by a growing economy. Those jobs will keep families in their homes, permit still more families to purchase homes, and strengthen housing markets across America.

In the weeks and months to come, it is likely many proposals will emerge that intend to resolve the mortgage crisis. I pledge to not play election-year politics with the mortgage crisis; it is my obligation to put America's interests before political ambitions. Instead, in evaluating any proposal to help subprime mortgage holders, I will rely on sound principles:

--No taxpayer dollars should bail out real estate speculators or financial market participants who failed to do due diligence in assessing credit risks.

--Any policy of financial assistance should be accompanied by reforms that ensure we will never face this problem again. Central to those reforms should be transparency and accountability.

--Homeowners should be able to easily understand the terms and obligations of a mortgage.

--Lenders should be accountable for acting responsibly in originating and securitizing mortgages. In the past, lenders who sold mortgages retained no risk or accountability.

--The predominant sources of the current housing and credit problem are too little equity, small down payments by homebuyers and too little capital in our financial institutions.

--Policies should move toward ensuring homeowners provide a responsible down payment of equity at the initial purchase of a home.

--Our financial-market approach will include encouraging increased capital by removing regulatory, accounting and tax impediments.

--Where government assistance is merited and received, all parties--lenders and homeowners--must participate in financial sacrifice in order to qualify.

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