Democrat Hillary Rodham Clinton called on President Bush today to appoint "an emergency working group on foreclosures" to recommend new ways to confront the nation's housing finance troubles.
The New York senator said the panel should be led by financial experts such as Robert Rubin, who was treasury secretary in her husband's administration, and former Federal Reserve chairmen Alan Greenspan and Paul Volcker.
Such a panel would recommend legislation and other steps to "help re-establish confidence in our economy," Clinton said in prepared remarks for a speech on the economy in Philadelphia. She and Sen. Barack Obama are campaigning heavily in Pennsylvania, which holds its presidential primary April 22.
Clinton also proposed greater protections for lenders from possible lawsuits by investors, a version of so-called tort reform more often associated with Republicans than Democrats.
Many lenders are unwilling to undertake "far-reaching restructuring efforts" for fear of being sued by investors who buy mortgages, she said. She said she would introduce legislation to limit the lenders' legal exposure.
Clinton said she supports proposed legislation to establish a federally backed auction system for hundreds of thousands mortgages in default. Under the Democratic-drafted plan, lenders "could sell mortgages in bulk to banks and other buyers," she said, who in turn would "restructure them to make them affordable for families, because they know the government will guarantee them once they're reworked."
But more steps are needed, Clinton said. The Federal Housing Administration, she said, "should also stand ready to be a temporary buyer to purchase, restructure, and resell underwater mortgages."
Clinton said a recently enacted $168 billion stimulus package "did next to nothing to help homeowners and communities struggling with foreclosure."
"If the Fed can extend $30 billion to help Bear Stearns address their financial crisis," she said, "the federal government should provide at least that much emergency help to families and communities to address theirs."
Hillary Clinton calls for expert panel on housing crisis