Somebody Tell Me Why This Isn’t 1930’s Style Facism?

I don’t like to go off half-cocked. I have a Bachelor of Arts Degree in Political Science, but for the life of me, I can’t get my mind wrapped around this one.

Bankrupted California cities are now talking about seizing hundreds, possibly thousands of homes in California to condemn them, because the owners have troubled mortgages.

Under the controversial practice known as “eminent domain for Public Purpose” (Kelo v. City of New London) cities would be able to walk into essentially anybody’s home and say, “Sorry, you’ve gotta move. This property now belongs to the city!”

It’s a blatant, in-your-face, bare-assed grab of private property which our Constitution guarantees the government CANNOT do! Cities could then re-sell these properties to other homeowners who are theoretically more financially sound. The city makes a profit. The new homeowner gets a lower priced home. And the previous homeowner who was supposedly the deadbeat who couldn’t keep his HOA dues and his mortgage up, basically sacrifices the built-up equity of his home to the Goddess of Redistributivism.

Isn’t this bald-faced theft from the poor and subsidization of the middle income and rich? Of couse it is!

Lenders are furious that legislatures would arrogantly subsume their contracts with borrowers. Lenders took the risk in the first place to help put people into homes. Now, bankrupt cities across California are taking a very real look at this home-grab plan. That’s the crazy thing: they actually ARE looking at this home confiscation plan as something moral, and problem-solving.

Despite the obvious violations of the U.S. Constitution (actually, only fools and Tea party members still think the Constitution should be observed by American lawmakers), it all amounts to a land grab from private citizens that has has no precedent; absolutely no precendent ANYWHERE in American law.

It does have precedent in Nazi Germany, Mussolini’s Italy, Stalin’s purge of Russia, Castro’s seizing of the assets of Cubans, and Hugo Chavez’ nationalization of everything he can remember to nationalize in Venezuela.

Have we really come so far where this kind of outrage can be casually discussed at the local City Council meeting? California has the 9th Circuit of Appeals, the nation’s most radical court which would probably enthusiastically endorse the whole land-grab scam.

For the flag-waving, patriotic, red, white and blue American, the shame and embarrassment just grows. How do you explain to new immigrants that America is now considering adopting the same policies that drove them from their socialist home countries in the first place?


Ward Lucas, author of Neighbors At War! The Creepy Case Against Your Homeowners Association



Filed under Uncategorized

4 responses to “Somebody Tell Me Why This Isn’t 1930’s Style Facism?

  1. seashell55

    Are we reading the same news? I’ve read where San Bernardino County is considering a proposal to use eminent domain to buy underwater mortgages, which in SBC’s case is nearly all of them, and then work with Mortgage Resolution Partners to rewrite affordable, reduced principle mortgages for the same homeowners.

    Apparently, the plan works to get these mortgages out of the securities they’re tied into, which then allows them to be modified. According to the diverse backers of the plan, this will free the homeowner from foreclosure threats and stabilize housing prices.

    It’s more like the poor (SBC) helping the poor (underwater homeowners). True, Wall Street is unhappy, but Wall Street and their innovative securitizations ideas were the main cause of the crisis, and they don’t seem to make sympathetic victims.

    • Sadly, Seashell, we’re looking at two different consenquences of the same story. When eminent domain is used to take a home and make the government the new landlord, mortgage investors and lenders will be scrambling over each other to crawl out of the tar pit. With basically bankrupt cities using eminent domain to grab up properties the end result cannot be good for homeowners. A bankrupt city will not be able to keep its claws off whatever equity has been built up in the home. No, this skeptic cannot find a single case in the country where a private homeowner benefitted by any kind of eminent domain seizure. Dana Berliner with the Institute for Justice did a survey of 10,000 eminent domain cases across the country. I think her book might even be available for free. When you have a piece of private property that can be taxed, seized, or sucked dry, the government is NOT your friend. It is NEVER your friend.

      • seashell55

        I’m fairly neutral on government as friend or foe, it is what it is, and not so neutral on the power of private HOAs :-). Looking over Dana Berliner’s surveys, it seems she focuses on the use of eminent domain for the benefit of private parties, as in Kelo.

        In the case of San Bernardino County, eminent domain would not be used to seize the actual homes, only their mortgages. It’s certain investors and banks that stand to lose, not the homeowner (and I’m looking at this as an investor – a small one). The concept is not unprecedented and was covered by the Supreme Court in Hawaii Housing Authority v. Midkiff in 1984. The goal here is to reset the housing market back to the realm of realistic and believable.

        The scheme is not perfect and it’s not clear that SBC can handle the intricacies without screwing up, but it’s an idea with potential, which is more than anything we have now.

        And speaking of unbelievable, here’s a story of how a set of $2500 gates ended up costing $250,000 in a Florida HOA.

    • peg

      If this is the plan, it sounds good, but I don’t see how it is legal. How can the government take the house from the bank without paying the balance? It is not the governments place to interfere with private contracts. This could be the end of all our prooperty rights. As it is, many people underwater are walking away, or not paying, and the banks will be left holding a huge liablility, and no way to sell it for that amount. I don’t see the banks profitting from foreclosures. Their best bet is to allow short sales.

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