When the Tulsa World takes the time to write three articles, one cartoon, and an editorial criticizing an elected official for not lining up at the government trough, you can probably bet that a principled conservative stand has been made.
Such was the case earlier this month when Oklahoma Attorney General, Scott Pruitt, stood alone among his Republican AG colleagues nationally in refusing to participate in a national mortgage settlement brokered by the Obama administration to reengineer the mortgage industry, shakedown banks, and provide $26 billion in handouts to homeowners who stopped making their mortgage payments in the name of “justice”.
And how fortunate for the President that he can tout this deal as particularly beneficial to those swing states that he must carry to win reelection. Make no mistake, this was a political decision, not a presidential one that would be in the best interest of our country.
In October of 2010 a 50-state coalition of Attorneys General announced an investigation into the practices of five of the nation’s largest mortgage servicers. At the heart of the investigation was the faulty practice known as robo-signing where paperwork was not properly vetted by bank officials prior to foreclosure proceedings beginning.
The other most egregious conduct was that of dual tracking, where mortgage servicers encouraged homeowners to stop making payments in order to be eligible for loan modifications while simultaneously foreclosing on them when homeowners followed these instructions.
These poor practices and violations of state law deserved to be investigated by the AGs, and homeowners who were wrongly foreclosed upon deserve to have some form of restitution. That is an appropriate role and within the scope of Attorneys General authority.
What was not appropriate, however, was when the Obama Department of Justice hijacked the investigation and morphed it into a multi-billion dollar hand out to homeowners, requiring the banks to engage in loan modifications and principle reduction under the threat of prosecution on numerous fronts if they didn’t.
Attorney General Pruitt rightly refused to engage in a settlement that exceeded what he felt was the appropriate role of a state Attorneys General.
Instead, he brokered his own deal. A deal that will result in $18.6 million in damages for those few homeowners in Oklahoma who were victims of bad conduct by the banks, while opting out of the potpourri federal settlement that would have allowed any and all homeowners who were foreclosed upon in Oklahoma during a certain time period to get a $2,000 check and a reduction in their principle – even if they haven’t made mortgage payments for months and couldn’t afford their home to begin with.
The last time I checked, the problem with Washington and politics in America is that we don’t have enough elected officials who are willing to take principled stands against the philosophy of big government and exceeding their authority. Thankfully, we have more than a few principled leaders in Oklahoma, including General Pruitt.