Part 1 in a series on David
Schweikert’s taxpayer deception and his administrative manipulation of the real
estate market
Today: Schweikert goes to Congress
Congressman
David Schweikert is a self-proclaimed “numbers guy” and Maryvale real estate
investor who preaches the urgent need to shrink the size of government and
slash spending, lest we all perish from the stranglehold Obama will have on us
for generations.
Schweikert’s
prepared script is good campaign rhetoric and has generated publicity for his
thuggish friends at the Club for Growth.
His actions, however, prove that Congressman David Schweikert is a FRAUD
and LIAR. In media interviews, Schweikert likes to say, "The Devil is in the details". He must be the Devil, then.
Since
January 2011, Schweikert has been a covert congressional lobbyist for real
estate investors and medium/small sized financial service institutions.
As Politico Mafioso will explain in a series
of articles this week, Schweikert has been rewarded well for his many years of
loyalty to the corporate constituents and sectors he really went to DC
to serve.
Schweikert
is the ultimate inside trader and inside traitor.
In 2010,
Schweikert promised Arizonans he would get legislation passed that would
restore the American dream. As soon as he was sworn into office, Schweikert
went to work behind the scenes – working towards HIS dream, not yours.
Schweikert
has not worked to save Americans from the economic and housing crises nor
has he preached the virtues of his socially conservative beliefs.
Instead,
via his easy access and power as the vice-chairman of the Capital Markets and Government Sponsored Enterprises subcommittee
of the House Committee on FinancialServices, Schweikert has cultivated and promoted an entirely new Fannie Mae
and Freddie Mac government program that is immune from FOIA requests and the
legislative process of the people: The Federal Housing Finance Agency (FHFA)
REO Initiative.
[Fannie Mae and
Freddie Mac are known as GSEs (Government Sponsored Enterprises) and were placed
into conservatorship with the Federal Home Loan Banks in 2008 under the new
FHFA. The GSEs are considered private
companies and are not subject to public requests for information.]
Not only is
the FHFA’s REO Initiative not subject to FOIA requests, it is not subject to
lawmaking and political discourse either.
It is an administrative program that was groomed, created and enacted by
FHFA, the Department of the Treasury, HUD and Arizona Congressman David
Schweikert.
During its
inception in 2011, the FHFA identified eight locations across America which
experienced the worst crash and aftermath of the housing crisis. Each of the locations (allegedly) had such an
oversupply of vacant housing on the market that the cities faced a perilous
housing recovery unless the US government intervened and sold foreclosed houses
in its inventory – in a shadow market created by the FHFA’s REO Initiative. (REO stands for Real Estate Owned and is a
common term for a bank-owned property that has been foreclosed on.)
Schweikert
held a number of videotaped subcommittee meetings, appeared on cable news shows
and issued formal press releases where he couldn’t stifle his excitement as he
talked about the REO Initiative. Problem
was, Schweikert passed off the FHFA program as a lifeline for distressed
homeowners and neighborhood stabilization when, in fact, the program does not
help homeowners at all since they have already lost these homes through
foreclosure.
As the
conservator, the FHFA’s acting director Edward DeMarco testified before
Schweikert’s subcommittee in 2011 and said, “ Our mandates, simply stated, are: to preserve and conserve Enterprise
assets and place the Enterprises in a sound and solvent condition; to support a
stable and liquid mortgage market; and to maximize assistance to homeowners to
minimize foreclosures.”
This new
government program does not maximize anything for homeowners. It only enriches the pockets of large real estate investors,
like David Schweikert. He even sold out the largest city in his home state, Phoenix,
to shake loose the foreclosed properties in the FHFA’s inventory and make them
available for bulk purchase.
For its
first group of sales, the REO Initiative packaged foreclosed properties (like
those in Schweikert’s favorite investorhood, Maryvale) into bulk lots of
several hundred homes. The FHFA then put
out a Request for Proposal (RFP) for large investors to apply and be selected
as a qualified purchaser and manager of these bulk packaged properties.
The manager designation is the most important qualifying requirement of the
RFP.
See, the
REO Initiative is not just a gift to large investors who can buy cheap
properties in bulk – away from the free market.
The REO Initiative requires these investors to, under the
supervision of the US
government, RENT and MAINTAIN each property for at least five years in an
effort to stabilize the otherwise volatile local market. Each investor is also encouraged to offer a
“Rent-to-Own” agreement to prospective qualified renters so neighborhoods will
grow to be more balanced as home ownership returns.
Shockingly,
Schweikert’s own Phoenix, Arizona not only made the first FHFA list of
eight oversupplied housing markets in 2011 it has remained on the REO
Initiative’s targeted list through 2012, despite having a recovering market
with very low housing inventory, bidding wars and a median price increase of over 30% since Schweikert took
office in January 2011.
Phoenix’s
first FHFA REO Initiative sale occurred last week, within the FHFA targeted
first sale date of August 2012. Besides
Politico Mafioso, the Arizona
Republic’s Real Estate
reporter, Catherine Reagor, is the only member of the local media who has
questioned the unusual bulk sale.
Reagor said,” a source close to the deal said Fannie Mae is transferring the properties to an LLC that the winning buyer will invest in through a private placement deal.”
Schweikert’s
own ASU’s
W.P. Carey School of Business, Director of Real Estate Theory and Practice, Michael Orr, publishes monthly real estate reports containing the “official” statistics used by every
local Realtor, media report and academic. In this case, Schweikert turned a blind eye to Arizona’s housing recovery statistics as he
betrayed his home state, constituents and free market loving patriots.
As someone
who has signed a term-limit pledge and is facing incumbent Ben Quayle in a
contentious primary on August 28, Schweikert knows his days in Washington DC
are numbered either way. He went to
Washington and made good use of his time there but he served himself before
serving his constituents and the great state of Arizona.
His dog,
wife, calculator, campaign consultant and coffee machine are a front for a
manipulative man intent on winning favor and enriching his bank account, at any
cost. The Devil is in the details after all, Dave.
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