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Public Statements

Prepared Remarks of Secretary Shaun Donovan at the Public Meeting of Building One Pennsylvania

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Date:
Location: Lancaster, PA

Thank you, Pastor Crenshaw -- for that kind introduction, and for all that you and Councilman Goodson do to lift up your communities. Your work is an inspiration -- as is the work of all the extraordinary local leaders and advocates from First Suburbs, Building One Pennsylvania, and Building One America. Thank you all.

For an audience that represents such a broad range of backgrounds, I know you're all here for the same reason:

Because you care about your communities.

Because you work in the trenches, and see the impact of this economic crisis every day.

Now, that perspective may not always have been appreciated in Washington.

But with President Obama, believe me:

It is in the White House -- and this Administration.

With his background, for the first time in history, you have a community organizer--someone who's been in the trenches--sitting in the Oval Office.

Someone who knows what it is to go door-to-door to build a campaign or a movement -- who knows that the most meaningful, long-lasting change doesn't start at the top, but from the bottom up.

Someone who knows that at a time of record corporate profits, middle-class families shouldn't have to work harder and longer simply to keep up -- and that the Federal government has a role to play in strengthening their communities.

Who understands that fiscal responsibility isn't about leaving the most vulnerable Americans behind -- but bringing everyone along.

Who understands that, regardless of where we come from or how much money our family might have, every child should have the chance to go to a good school in a safe neighborhood and climb that ladder to the middle class.

And above all, we have someone in the White House who not only shares that perspective, those values and beliefs -- but is willing to fight for them.

So today, I'd like to talk about how that perspective has shaped everything we've done these last two-and-a-half years.

I want to talk about how we've responded to the challenges we've faced so far -- not just in pushing back against the economic crisis of the last few years, but just as importantly, working to reverse a decade of economic decline for working families.

And I want to talk to you about what we need to do to accelerate the pace of change and fight for our priorities together -- to ensure that every American family has the opportunity they need to be a part of winning the future.

The Challenges We Face

Now, you and I know the scope of the problems we faced when President Obama took office.

But I'm not sure everyone appreciates just how deep the hole in our economy was -- as families and communities faced the worst collapse any of us have ever seen in our lifetimes.

But the shock and pain of the crisis actually masked a decline that may have been more subtle, but was no less painful.

I'm talking about the erosion of the middle class -- which thanks to misguided policies that rewarded wealth over work, and special interests over shared opportunity, started to erode the engines of America's economic growth:

Our people. Our families. Our communities and regions.

Now, I'm not telling you anything that Pennsylvania's families don't already know -- but let me share just a few statistics with you that illustrate the scope of the problem.

When President Obama took office, the median family income had dropped by $3,800 in the past decade.

Think about it -- families were earning almost $4,000 less than they were only a few years earlier, even as the cost of housing, health care, energy, transportation--you name it--continued to skyrocket.

Indeed, right now, American families spend more than half of every dollar they earn on housing and transportation costs.

Over the last three decades, household income has grown 4 times faster for the top 10 percent of families as it has for middle-income households -- and the share of income going to the top 10 percent has increased a third.

And that was all before the economic crisis even began -- before the mass layoffs and the mounting foreclosures, before so many small businesses started to collapse and before so many families saw a lifetime of savings wiped out in a matter of months.

Pushing Back on the Crisis

When the gap between the wealthiest Americans and those with the least is growing wider every day, that doesn't just raise the problem of fairness -- it makes the task of climbing into the middle class tougher than ever before.

And so, our first task was to stop the bleeding -- to extend a lifeline to our most vulnerable families, while keeping middle-class families from losing any more ground.

To create jobs and put money back into the pockets of working families, President Obama enacted a series of new and expanded tax credits -- from a payroll tax cut to the Making Work Pay tax credit to an expansion of the Earned Income Tax Credit. Collectively, these have put $3,600 in the pockets of families earning $30,000 per year.

To help people who had lost their jobs through no fault of their own, we expanded unemployment benefits for the long-term unemployed -- both through the Recovery Act and again in last December's tax deal.

To help vulnerable families put food on the table, we made new investments in federal child nutrition programs.

These changes alone kept 1.7 million children above the poverty line last year.

Using Recovery Act funds, we've modernized more than half a million public housing units -- and I saw some of this progress for myself when I visited the Prospect Terrace development in Pittsburgh and the Warnock Street development in Philadelphia.

In places like these, the work we're doing to "green" public housing is both revitalizing the homes themselves and reducing energy costs for the families who live in them.

I know you've heard some people refer to the Recovery Act as a "failed stimulus."

Well, tell that to the 1 million people the Recovery Act saved from homelessness since the beginning of the Administration.

That's a million people who won't be forced to sleep on our nation's streets, in their cars or double up at a relative's house. A million people--men, women and children--who can begin their lives again.

Tell that to the six million Americans who the Recovery Act prevented from falling into poverty.

The result of these investments is clear -- despite the economic headwinds we are still facing, we've been able to protect low-income families and offered middle-class families the relief they desperately needed.

Of course, the immediate cause of the economic crisis was the housing collapse. And while it's clear we still need to do more to keep families in their homes, let's be clear:

Our efforts have made a real difference.

Just ask those here today who are housing counselors. Since President Obama took office, HUD-approved housing counselors have helped nearly 6 million families.

According to our friends at NeighborWorks America, distressed homeowners working with a housing counselor are nearly twice as likely to receive a modification on their mortgage.

Stunningly, despite the need--despite evidence housing counseling works--the House majority eliminated this funding from HUD's budget.

It's outrageous that some in Washington think that seniors who have paid taxes and worked their whole lives to own a home shouldn't get the help they need to keep it.

It's wrong that a veteran returning from Iraq or Afghanistan may not have the chance to sit down with a counselor to work out a mortgage their family can afford.

President Obama has proposed to restore this funding to a record high level in 2012 -- and I'm asking all of you to talk to your Member of Congress and let him or her know Pennsylvania families need those funds.

But counseling is only one part of this Administration's commitment to ensuring that families who need help get it.

Outrageously, before President Obama was inaugurated, the majority of loan modifications that banks and servicers were doing weren't making mortgage payments more affordable, but more expensive -- actually raising monthly payments on borrowers.

Well, because we pushed the banks to clean up their act, that's no longer the case. More than 5.1 million families have received restructured mortgages since April 2009--twice the number of foreclosures completed in that time--and families are saving over $300 per month on average.

That's not all we're doing to get help to families during this crisis.

Some of you may have heard about the foreclosure settlement we're pursuing with state attorneys general and the largest mortgage services in response to the revelations that banks were improperly foreclosing on some families -- using faulty documentation and fraudulent affidavits.

The notion that many of the very same institutions that helped cause this housing crisis may well have been making it worse is not only frustrating -- it's shameful.

I know some have suggested that the Administration wants to let the banks off the hook with this settlement.

Well, take it from me: the goal of this settlement isn't to help banks.

It's to help people.

And it's to provide that help not sometime in the future by which time it will be too late to help many of these families.

We need to help them now -- particularly those families who can't sell their home to get a new job because they owe more on their mortgage than their home is worth.

And once we get this settlement finalized, we will help them.

But we are not just waiting for the settlement to take more actions to extend that help. Indeed, this week, the Federal Housing Finance Agency announced changes to help more families who are underwater refinance their mortgages.

With these changes, families will be able to take advantage of the lowest interest rates in half a century, saving homeowners an average of $2,500 each in the first year alone and pumping billions of dollars into our economy.

Laying the Foundation for Long-Term Reforms

As important as these efforts have been to stop the bleeding and keep more families from falling out of the middle class, they've also laid the foundation for reforms that will grow the middle class and allow families to climb the ladder of opportunity.

First and foremost, that means ensuring that our children enter school ready to learn, and graduate ready to compete in the 21st century economy.

That's why we've made investments that have ensured 360,000 more kids have access to Head Start, Early Head Start, and child care assistance.

And it's why we've championed student loan reform, increased Pell Grant funding, and created the American Opportunity Tax Credit, which has eased college costs for over 9 million families.

Combined, these represent the single largest investment in higher education since the G.I. Bill -- and with President Obama's new proposal to allow more than a million-and-a-half students to reduce their monthly loan payments, we're making it even more affordable for middle-class families to send their kids to college.

Still, education alone doesn't always address the root of the problem -- particularly in neighborhoods with high rates of poverty and lack of access to opportunity.

Indeed, research shows that one of the most important factors in determining whether or not children will do better financially than their parents is not talent.

It's not even education.

It's their zip codes.

It's whether they grow up in a poor neighborhood.

That is a tragedy -- and with 20 percent of our kids trapped in high-poverty neighborhoods, it's one I can't accept -- and neither do you.

That's why HUD recently awarded our first Choice Neighborhoods grants, which builds on the HOPE VI program that has created nearly 86,000 homes in healthy, mixed-income communities that were once troubled by distressed public housing -- and raised incomes by 75 percent or more.

With Choice Neighborhoods, communities like the Manuta neighborhood in Philadelphia, where nearly half of families live in poverty, will be able to use these proven tools to transform the neighborhood.

Partners ranging from Drexel University to the local Head Start program will work with local residents to strengthen the troubled Mt. Vernon housing development and bring real transportation options to the neighborhood.

And with reforms proposed in our budget, President Obama wants to bring this smart government approach to every family that lives in public housing -- preserving affordable housing and creating construction jobs in communities that need them most.

That's not just change you can believe in -- it's change you can see for yourself.

But as Building One America knows better than anyone, challenges like poverty don't end at the city block or the city line -- we need a regional approach to truly tackle the challenges of the 21st century.

That's why we partnered with the Department of Transportation and the Environmental Protection Agency to put $170 million to work helping communities plan smarter and reduce housing and transportation costs for families.

To see this work in action, all you have to do is drive four hours west to Pittsburgh, where local partners are using one of our grants to convert vacated industrial land into a new transportation corridor -- providing more families with the chance to live near the economic heart of the city.

Pittsburgh's example shows how our local partners are using federal help not just to connect families with affordable housing, transportation, and jobs, but to drive the smart growth our regions need to compete.

But it isn't just central cities like Pittsburgh that face these challenges. Take Chester, which despite being only a few miles from Philadelphia has long struggled with crime, troubled schools, and economic decline.

That's why the Obama Administration recently announced our "Strong Cities, Strong Communities" pilot initiative, which will help 6 distressed cities--including Chester--tackle their toughest problems.

Under the creative leadership of Mayor Butler, Chester has already partnered with Widener University to redevelop the city's downtown. And with "SC2" providing on-the-ground technical assistance and resources, Chester can take that work to the next level.

As this work demonstrates, the Obama Administration isn't just offering the kind of one-shot federal assistance we've seen in the past.

We're offering a new kind of federal partnership -- one that helps harness the energy and talents of a community to prepare that community for the challenges--and opportunities--that lie ahead.

The Task Ahead

So, one thing is clear -- while the hole we found ourselves in was bigger than anyone imagined, we've made real steps to dig ourselves out of it. And I'm proud of all the work we've done with partners like you to make that progress.

But now is the time to take this work to the next level -- to accelerate the pace of change.

That's why President Obama proposed the American Jobs Act, which would get our economy moving, put our people back to work, and help our communities build back stronger than ever before.

The benefits to Pennsylvania's families would be immediate -- from reforming the unemployment system and helping put Pennsylvania's 211,000 long-term unemployed workers back to work, to preventing more than 14,000 teachers and first responders in your communities from being laid off.

Some have recently suggested that preventing teachers, cops, and firefighters from losing their jobs might be a good idea -- but that it's a "local" problem that the Federal government shouldn't bother to help solve.

Needless to say, I disagree -- and so would communities like Chester, Philadelphia, Pittsburgh, and Lancaster.

Now, maybe there's a teacher or first responder in danger of losing her job who only wants help from the city of Lancaster or the state of Pennsylvania -- and not Congress.

But I haven't met that person -- and I'm willing to bet you haven't, either.

The American Jobs Act willhelp us build on the work I've just described to create real pathways to opportunity -- from putting hundreds of thousands of construction workers back on the job modernizing our infrastructure and 35,000 public schools nationwide, to expanding summer jobs and employment training for 16,000 poor teenagers in Pennsylvania who may be looking for their first path to opportunity.

One of the most innovative ideas in the American Jobs Act is a new Project Rebuild, which would create 200,000 jobs in communities across the country.

Project Rebuild builds on HUD's successful neighborhood stabilization efforts in communities like Reading, which have helped local leaders in our hardest-hit neighborhoods buy up foreclosed and abandoned homes and turn them into the affordable rental housing that families need -- and is on track to address 95,000 properties and create 90,000 jobs.

Indeed, when I visited Pittsburgh last month, I was able to see for myself how a small investment in less than two dozen homes is transforming the Hill Neighborhood.

Project Rebuild reflects a belief I know every member of this audience shares:

That rebuilding our neighborhoods and regions isn't part of rebuilding our economy. It's absolutely essential to it.

By allowing our local partners to redevelop not just homes, but commercial properties as well, Project Rebuild will attack blight and foreclosures from all sides -- revitalizing neighborhoods and providing the spark entrepreneurs need to start small businesses and create jobs.

Of course, as you probably know, a united minority in the Senate has decided to band together and block passage of the American Jobs Act -- as well as attempts to pass it piece-by-piece.

Indeed, Republican leaders in the House have said that they won't even allow a vote on the American Jobs Act -- even though virtually every idea in it has bipartisan support.

Well, President Obama won't take "no" for an answer -- and I know you won't, either.

President Obama needs your help.

We can't build one Pennsylvania if you don't tell your local leaders just how important this legislation is to your communities -- to teachers and first responders, to small businesses, to reducing blight.

He needs you to do what you do best: knock on doors, talk to your neighbors.

Reach out to people, young and old, rich and poor, disenfranchised, or too cynical about politics.

Let them know this isn't about our politics -- it's about our future, yours and mine.

Let them know just how high the stakes are for all of us -- and what's at stake in the American Jobs Act.

And let them know we need their help.

Keeping the Pressure On

Because this isn't just about a piece of legislation.

This isn't just about a bill on Capitol Hill.

It's about moving forward.

Not you, not me. But together.

All of us.

As far as we still have to go, we can't go back to the era of "every man for himself." That's how we got into this mess in the first place.

As I mentioned at the beginning of my remarks, perhaps no President in history cares so deeply about the issues you care about.

Having worked closely with President Obama since becoming HUD Secretary, I've seen what a man who spent hundreds of evenings working to organize the residents of Chicago's public housing is capable of.

I've seen him stand tall -- and refuse to let the budget be balanced on the backs of the poor during those endless, frustrating debt ceiling negotiations.

And because he did, HUD will have a budget next year that doesn't tell families earning $10,000 a year that they have to fend for themselves in this economy.

I've seen him think big -- and ask, "If we can save 1 million people from homelessness in the midst of the worst recession since the Great Depression, why can't we end homelessness in America for everyone?"

And because he did, we now have the first strategic plan in history to end homelessness once and for all in this country.

And with obstruction on Capitol Hill over the American Jobs Act, I've seen him say "we can't wait" -- that if they won't act, he will.

And because he is, more homeowners will be able to stay in their homes, more students will be able to afford college, and more veterans will be able to find work.

That's progress. That's change. And that's just this week.

But we can't do it alone. We need allies like you -- fighters, working every day in the trenches, for little money and less glory, to make that change real on the ground. In people's lives.

To help us build one Pennsylvania -- and one America, with liberty, justice and, above all, opportunity for all.

That's why I'm so proud to be your partner. God bless you all.


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