Bankruptcy

Professor Warren, Appointed to Chair of Congressional Oversight Panel for Economic Stabilization

By J. Michael McBride

On November 14, 2008, Ms. Elizabeth Warren was appointed by United States Senate Majority Leader Harry Reid to serve on the five-member Congressional Oversight Panel (COPES) created to oversee the implementation of the Emergency Economic Stabilization Act. Also, he has selected Elizabeth Warren to the oversight division of the Troubled Assets Relief Program (TARP). This program was a result of the Emergency Economic Stabilization Act of 2008, a.k.a. The Bailout.

In response to a growing realization that the 700 million dollar bailout has been used in a random fashion and without adequate oversight, Congress has formed the COPES. The purpose of the Congressional Oversight Panel for Economic Stabilization is to see how the Financial Bailout Program is working, and if it is succeeding in dealing with America’s Economic Crisis. It is that panel’s job to oversee the bailout and access the impact it has made on the economy. The first report of the COPES, issued a few days ago, explains what guides the panel’s work and addresses questions pertaining to the Financial Bailout. The report contains questions such as: What is the Treasury Department’s strategy?; Is it going to stabilize the market and reduce foreclosures?; Is the public receiving a fair deal?; What is Treasury doing to help the American family? While discussing TARP statistics, Elizabeth Warren states that $350 billion has been committed to Treasury to spend how they would like. According to Elizabeth Warren, the Treasury has spent somewhere around $150 billion towards the program. The Bailout Plan has released money to 54 “healthy” banks, and purchased AIG Insurance Company, and City Bank.”

Warren recently discussed her role as a member of the COPES and the mortgage foreclosure problem in general, estimated that there will be 8 million family foreclosures in the near future. That is 1 in 7 families with a mortgage who will go through foreclosure. While houses are being foreclosed, the real estate market significantly is losing thirty to forty percent of its value. No one will buy a house for sale in that area when they can purchase a foreclosed house in the same neighborhood for 30% - 40% less. Thus, the real estate market is ‘freezing up’ where there are foreclosures.

As background, at Harvard Law School, Elizabeth Warren is the Leo Gottlieb Professor of Law. She has co-authored two books with her daughter, Amelia Tyagi: All Your Worth: The Ultimate Lifetime Money Plan (Free Press, 2005) and The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke (Basic, 2003). In the 2006 documentary film, Maxed Out, Warren made an influential exposition on the subject of the overwhelming debt of America.

Here is a link to the full story:
http://www.npr.org/templates/story/story.php?storyId=98123372&ft=1&f=13

Angela

Full post as published by Texas Lawyer Blog on December 18, 2008 (boomark / email).