Check this out: the lawprof who thought up the underwater mortgage taking plan, Cornell's Robert Hockett, along with his co-author, the "Founder and Chief Strategy Officer" of Mortgage Resolution Partners (the venture capitalists who are funding the scheme and who stand to benefit from it), have posted a new article in the Harvard Law & Policy Review, "A Federalist Blessing in Disguise: From National Inaction to Local Action on Underwater Mortgages."
One guess what the article concludes.
In case you have not been paying attention, here's the abstract:
While it is widely recognized that the mortgage debt overhang left by the housing price bubble and bust continues to operate as the principal drag upon U.S. macroeconomic recovery, few seem to appreciate just how locally concentrated the problem is. This paper takes the measure of the national mortgage debt overhang problem as a cluster of local problems warranting local action. It then elaborates on one form of such action that the localized nature of the ongoing mortgage crisis justifies - use of municipal eminent domain authority to purchase underwater loans, then modify them in a manner that benefits debtors, creditors, and their communities alike.
Meanwhile, the federal court has dismissed as unripe the lawsuits challenging Richmond, California's nascent attempts to implement the scheme, so as Sonny and Cher reminded, "the beat goes on."