That story about Richmond, California starting down the path of using eminent domain to take underwater mortgages is taking on a life of its own. Here’s the latest.
Before we bombard you with links to the most recent commentary and stories, here’s some backstory. Remember how we said this was taking on an “Occupy” flavor and seemed as much fueled by a let’s-get-those-greedy-bum-bankers vibe as by thoughful economics and a careful use of eminent domain? Well, a little digging showed that wasn’t far off. It seems that lawprof Robert Hockett, the guy who came up with this scheme (calling it a plan that “pays Paul and robs no one”) is a Founding Board member of something called the “Occupy Money Cooperative,” which touts itself as a “revolution,” “a cooperative company that offers low-cost, transparent, high quality financial services to the 99%.” (ps: you forgot “sustainable”). Hockett “has been involved with the [Occupy Wall Street] movement since its first weeks in Zucotti Park … and is best known of late for his design and advocacy of eminent domain solutions to the nation’s continuing underwater mortgage debt problem.”
Things that make you go “hmmmm.”
On to the links:
- Richmond, Calif. Eminent Domain Proponents, Critics: Q&A. A short video from ABC News, and comments from lawprofs Gideon Kanner and Ilya Somin.
- Richmond itself might be “underwater.” Let’s condemn it! Richmond’s eminent domain plan credit negative for RMBS – Moody’s (via Reuters)
- From Bloomberg, this commentary: If I Bribe City Hall, Can I Reduce My Mortgage?
- Two from the aforementioned Professor Somin: Using Eminent Domain to Condemn Mortgages and Just Compensation Problems with the City of Richmond’s Plan to Use Eminent Domain to Condemn Mortgages.
- Event the San Francisco Chronicle (!) seems to have its doubts about this proposal: Eminent domain a questionable home remedy.
- Another one from Bloomberg: California Mayor Attacks ‘Greed’ With Eminent Domain Bid.
- Flashback: Inside the Radical Plan to Fight Foreclosures With Eminent Domain. From Mother Jones back in January 2013, but a good read about why Mortgage Resolution Partners, being venture capitalists, are the ones pushing for this and bankrolling it. Hey wait, I thought venture capitalists guys were the bad guys? Turns ot they are venture capitalists with juice: their “secret formula” is their political connections. Ain’t rent seeking grand?
- Why the Left and the Right Should Join Forces against Eminent Domain – from the Market Urbanism blog.
- Eminent domain: Not just a headache for investors – via Housingwire.
- And Professor Kanner weighs in in detail: Stop the BS About Underwater Mortgage Eminent Domain Takings!