| 05.29.08|
Ignorance Or Arrogance Redux: Richardson Mortgage Defaults
Last April I wrote the first of many posts on Michael Ellis. In the title of that post and in the content I asked if Ellis was Ignorant or Arrogant; upon reading of Congresswoman Laura Richardson’s failure to make mortgage payments on three separate properties and her subsequent statements regarding her mortgage defaults I feel compelled to ask the same question.
After reading the initial reports of the foreclosure of Richardson’s property in Sacramento I wrote a post asking several questions from my experience as a mortgage broker. With knowledge of the process required to qualify and fund a mortgage, plus knowing the timing required from missing payments to foreclosure, I had several questions regarding Richardson’s failure to pay her mortgage. After reading this article, those questions have changed.
Richardson commented to the Press-Telegram, “I am not financially wealthy….I am not a millionaire…Based upon what I was going through, changing four jobs in less than one year, I think any American would understand what that does in terms of a person’s financial stability.” Excuse, me? “Any American” does not choose to change jobs by running for two full time public offices within a span of six month. “Any American” does not get a new $535,000 second home with no money down within days of taking an oath of office for a job to which they are elected. “Any American” would no doubt make much better decisions on what their financial abilities are before obligating themselves to yet another mortgage.
Was Richardson’s motivation to purchase the property in Sacramento in the first place based on the arrogance of feeling she would be in office in Sacramento through her term limits as a member of the Assembly and then the State Senate for which she would no doubt have been a candidate given the revolving door between the two chambers since term limits were enacted? There is little reason to suspect otherwise given her Assembly district was gerrymandered to be so heavily Democratic that the only way she would not have been re-elected would be some gross violation of public trust—like a foreclosure perhaps. Or was the decision based on ignorance of how to handle her own personal finances and economics while at the same time passing legislation that affects our personal finances—yours and mine?
When Richardson took her oath of office for the United States Congress on September 4, 2007 she said in her speech on the floor of the House of Representatives, “I am straight forward and honest….I will keep my word.” As she made these proclamations to her new colleagues in the House she was already several months delinquent on several mortgages. To whom is she “straight forward and honest?” To whom does she “keep my word?” Evidently not those who provide mortgages as she broke her promise to pay as outlined in the notes and deeds of trust she signed for three lenders. Was she honest and straight forward with her House colleagues when she joined them last fall, again while she was defaulting on mortgages, and voted in favor of the Mortgage Forgiveness Debt Relief Act of 2007 from which it appears Richardson may stand to benefit at least $50,000 in taxes? Was she arrogant enough to think her vote on a matter that would directly benefit her financially was of no matter to her constituents, or was she ignorant to the fact that her properties then in default would qualify?
In Richardson’s bitter campaign in the Democratic Primary for the 37th Congressional District a mailer attacked her opponent Jenny Oropeza for being absent from the Assembly and missing several votes; absences due to Oropeza’s battle against cancer. During the timing of the mailers it appears Richardson had already stopped making payments on her home in Sacramento, and possibly San Pedro. Was it arrogance or ignorance that led her to direct her financial resources on her run for public office instead of her obligations to her mortgagors? While criticizing Oropeza for missing work in the Assembly she was missing mortgage payments—which transgression is greater to your constituents?
In her interview with the Press-Telegram Richardson said, “we need to put a better process into place, so a person’s home is not sold out from underneath them.” Is this statement one of arrogance that she is above her own actions that led to her foreclosures, or one of ignorance and she honestly believes her property in Sacramento was “sold out from underneath” her? She makes $169,000 a year as a member of Congress, she made the decision to purchase a home with no down payment for $535,000 within days of taking a new job, she chose to dump over $70,000 into her campaign for office, she feels compelled to try to equate her foreclosure situation with those of thousands of Americans with one property, with one job making far, far less than $169,000 and are losing their homes through foreclosure and I am not supposed to think she is another arrogant politician that is ignorant of the daily world the rest of us live in?
Richardson’s attitude thus far seems to be one of non-responsibility, blaming a process that allows a home to be “sold out from underneath” her, claiming errors on the part of the lenders, ignoring that she was the one who failed to tens and tens and tens of thousands of dollars in mortgage payments. And she will probably take that attitude back to Washington D.C. after the June 3rd primary secure in the knowledge she will keep her seat. The news of Richardson’s mortgage delinquencies was too late to allow Oropeza or another serious challenger to enter the primary. The gerrymandered 37th District with its overwhelming Democratic voter registration is a safe seat for her after the primary—so safe in fact that there is no Republican primary. Short of a strong independent candidate entering the race after the June primary to run against her in November, Richardson will most likely keep her seat—unscathed and unpunished despite failing to uphold what she said to Congress last September, to keep her word, to be straight forward and to be honest. With the lack of any redistricting on the California horizon politicians like Richardson can afford to be arrogant and ignorant once they win their primaries.
What is most worrisome at this point is Richardson will go back to Washington D.C. somehow feeling she understands what Americans going through foreclosure are feeling and use this misguided equivalence of their situations with hers to make legislation. The “straight forward and honest” thing to do would be to recuse herself from any votes that involve mortgages, foreclosures or real estate; but that would take neither arrogance nor ignorance. Time has come for Richardson to be honest with her constituents as to how she can be months and months behind on her personal obligations and commitments and still expect us to feel she is honest, straight forward and keeps her word—words she herself used to describe herself on the floor of the United States House of Representatives.
YouTube of Richardson’s speech on the House floor September 4, 2007 while several months behind on her mortgage(s).
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