Brian Catalde, president of the National Association of Home Builders (NAHB), today issued the following statement regarding disbursement of PAC money to federal congressional candidates:
“Today, the National Association of Home Builders’ Political Action Committee, BUILD-PAC, and its 150-member Board of Trustees representing all 50 states, agreed to cease all approvals and disbursements of BUILD-PAC contributions to federal congressional candidates and their PACs until further notice.
“This extraordinary action was taken because the NAHB BUILD-PAC Board of Trustees felt that over the past six months Congress and the Administration have not adequately addressed the underlying economic issues that would help to stabilize the housing sector and keep the economy moving forward. Housing and related industries account for more than 16 percent of the Gross Domestic Product. More needs to be done to jump-start housing and ensure the economy does not fall into a recession. This action will remain in effect until further notice.”
Washington Post story, "Housing Accord Puts Builders First," 4/3/2008 (emphasis mine):
"Senate Democratic and Republican leaders rushing to address the nation's housing crisis reached agreement yesterday on a package that would provide billions of dollars in tax rebates to the slumping home-building industry while offering little to homeowners threatened with foreclosure.
"After working through Tuesday night to flesh out a bipartisan agreement, lawmakers unveiled a bill that rejects the most ambitious plans for aiding distressed homeowners, including a Democratic proposal to permit bankruptcy judges to modify the mortgage on a person's primary residence.
"Instead, lawmakers settled on a sharply scaled-back array of measures that would provide $4 billion in grants for cities to buy foreclosed properties, temporary tax breaks worth up to $7,000 for home buyers who purchase foreclosed properties, and new tax deductions for almost every American who owns a home. The package, which would cost about $15 billion over the next 10 years, also would jump-start stalled legislation to streamline the Federal Housing Administration, one of the top priorities of the Bush administration.
"Families who cannot afford to repay their home loans -- the group at the heart of the mortgage meltdown -- would benefit mainly from $100 million to expand foreclosure counseling services and greater latitude for local housing authorities to use tax-exempt bonds in refinancing subprime loans.
"Home builders and other businesses suffering losses in the flagging economy, meanwhile, would get the lion's share of federal spending in the bill: $6 billion in tax rebates."
I wonder if those PAC donations will start to flow again now.
UPDATE: For more interesting reading on this subject, check out what Fil Zucchi had to say over at Minyanville. Here's an excerpt:
"In essence, taxpayers will give back to the Robert Tolls and Ara Hovnanians of the world millions of dollars to prop up their closely held companies, i.e. companies in which they have majority interest and/or control, whose stocks these individuals had the magic foresight to dump by the millions of shares right before the whole Ponzi scheme collapsed.
"If ever there was an action that should undermine investors' confidence in the U.S. market system and reinforce the view that the government exists to grease the palms of those who pay their way into influencing the government, this is it."