"They are . . . not interested in asking millionaires and billionaires to pay a half a penny on the dollar for the sake of the future of our children and communities."
That was the reaction of Sen. Bob Menendez (D., N.J.) upon the defeat Thursday evening of the bill he sponsored that paired an element of President Obama’s jobs plan — funding for the hiring of some first responders and hundreds of thousands of unionized teachers — with a surtax on those earning more than $1 million.
Yet that same evening, Menendez and his fellow Democrats — as well as self-proclaimed socialist senator Bernie Sanders — voted unanimously to protect subsidies for millionaires’ mortgages. In fact it was another measure Menendez himself sponsored: an amendment to an appropriations bill that will allow Fannie Mae, Freddie Mac, and the Federal Housing Administration to back home loans as large as $729,750. With help from a handful of Republicans, his measure cleared the Senate 60–38.
This “conforming loan limit,” the maximum for mortgages Fannie and Freddie can buy and the Federal Housing Administration can insure, had expired at the end of September and reverted to $625,500. But Menendez proclaimed that Congress must raise the limit back to almost three-quarters of a million dollars in order to save the “middle class.” Not raising the limit “makes it harder for middle class homebuyers to get credit when credit is tight,” Menendez said.
But this definition of middle class is pretty, shall we say, rich. As a Wall Street Journal editorial noted, “the average sales price for existing homes in September was $212,700.” And even in Menendez’s home state of New Jersey, the median sale price of homes was only $303,100 in August, as calculated by Zillow.com, a prominent real-estate website. This amount is less than half of the $729,750 limit Menendez and the other Democrats said was necessary to protect the “middle class.”
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Editor in Chief, THL
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