Teamwork

A good example of team work is how Clinton and Gates were able add to
your speech to surge in Afghanistan and propagate your message.
Clinton has a particularly difficult job (always walking on egg
shells), accepting your boxed in position (regional czars) yet hit the
ground running and performs at high energy levels. Rahm Emnual has
taken on the tough jobs and delivered. These are great team players
and don't nearly receive the gratitude they deserve.

The failure of teamwork by your economic sector has created a dismal
economy with dim prospects. No economic policy ever gets amplified.
Romer has an interview, Summers has an interview, Geithner mumbles and
things get sucked into a sink hole.
I never fail to remind you how Geithner fails you. In March, I
patiently waited for Geithner's solution to the securitized mortgage
crisis. I felt it was inadequate but rather than pan it, I made an
effort to provide an alternative. The Congressional Oversight Panel’s
year-end report concludes that “the foreclosure crisis continues to
grow,” and finds that “TARP’s foreclosure mitigation programs have not
yet achieved the scope, scale, and permanence necessary to address the
crisis.” Geithner failed.

Some consider housing as the backbone of the American economy. The
mortgage modification program has provided 10 revised mortgages. Reset
mortgages will continue to trigger for 17 more months. The number of
homes whose mortgage exceeds market value is sustainably high.
Unemployment contributes to more foreclosures. Your administration
has only provided band-aid fixes. You have never defined the problem
and this makes it difficult to arrive at a solution.

I proposed that property values be reset to market rates through a
task force of External Auditors. The mortgage lenders take the hit
for the amount of the mortgage in excess of the market value. The
home owner's equity portion in home ownership becomes fair. The
bubble was caused because certain owners were not required to make a
down payment, to establish a reasonable equity position and didn't
know their variable rate mortgages would escalate. It is
irresponsible to give hope to these people that they could re-finance
their mortgage.

The current stalemate is that the lenders (the Banks) have not taken
their loss and are unwilling to do so. The role of Government, to
ensure that property values fairly reflect market values and then
undertake the administrative paperwork to re-write home owners
mortgages based on this market price at whatever interest rate the
bank dictates. The banks are unwilling to provide the human resources
for such an undertaking. This is the perfect stimulus project. Create
a Mortgage Revision Bank that hires a lot of unemployed mortgage
officers and bank officials and does the administrative work for the
banks.

There is a real need for team wok in your Economic sector- amongst
themselves, with Congress and the electorate. They have failed at
teamwork. You have failed as coach, manager and owner. You need a
game plan, a set of plays to execute the plan and the bodies to
execute the plays. I sincerely feel that James Baker can make a
strong contribution because he is a team player, he gets along with
Congress and he's smart and willingly does the dirty work, a
diplomatic Rahm Emnual! Don't make him in charge, he was a disaster
as Secretary of Treasury, but he will make a big contribution
especially if Congress goes Republican. My hope is that he would
carry some of Emnual's workload.

Pundits compare your first year to Clinton and Reagan, unfavorable
polls with hostile Congress yet ending strong. Let me warn you that
you are looking a lot like Jimmy Carter, financial calamity, hostile
foreign affairs yet a really decent guy. Carter faced historic
inflation,...so will you! One day, the dollar will drop forcing
interest rates up and when it starts moving, there is no reason to
stop. I must admit, I don't know what I'm talking about. I've always
considered your greatest strength is your ability to counter-punch. I
haven't heard anything from you that counters my assertions.

I told you so.

PS
I know you are wary of group think and seek out divergent opinions. I
would suggest that you meet Elizabeth Warren and John Geanakoplos for
a two hour meeting. It will be worth your while.