I don't think so; States appraise property values all the time so they know how much tax owners owe. Ostensibly, the appraiser wouldn't really set the rent so much as establish the value of the house, which would be plugged into a rent calculation developed by HUD or the relevant state agency (but I suspect it would end up being HUD). Allowing individual court-appointed appraisers to set rents willy-nilly is insane and the courts would likely insist on an objective, reasoned standard.

The bigger problem with this statute (as opposed to mortgage buying) is that could still kick the owners-cum-renters out if they can't pay the fair market value for rent, especially if it's significantly higher than what the homeowners had thought their mortgage payments would be. That is, a fair rent may be significantly more than some folks could afford (since the realtors promised crazy low mortgage rates beneath the average rental price per month).

Furthermore, the the proposal is too broad; it seems to presume that anyone whose mortgage sold for less than the metropolitan median value and is in danger of foreclosure is the victim of a subprime loan. Banks and other lenders who did not drink the subprime and real-estate values Kool-Aid (along with those who did) would be encouraged to deny even more home loans to folks buying below-median homes, since any such loan that results in foreclosure for any reason may transform a mortgagee into a tenant, destroying interest returns on the original loan. The statute may end up hurting (or simply fail to help) more low-income folks overall than it helps.

I mean, I'm all for sticking it to irresponsible lenders, but I'd be more in favor of government buyouts of foreclosed properties and the rent going to the state, which could turn around and sell the property once the renters leave on their own. The government would have to suck it up a little and pay an objectively fair foreclosure price; this would mean that lenders wouldn't lose so much that they'd grow more cautious about lending for below-median purchases, rather, they could not turn around and bamboozle a new buyer with crazy lending terms a la the current crisis.

Posted at May 26, 2008 3:06 AM in response to A Housing Bill that Doesn't Whack Low-Income Renters

DanK - it's not that liberals and libertarians are overly concerned with negative rights (what the govt can't do), it's that America as a whole is overly concerned with negative rights. This makes historical sense because, originally, the federal government was designed to not interfere with States' power. In this libertarian/federalist conception of government power, nothing philosophically constrains States from adopting and promulgating positive rights (right to housing, home, food, camping every weekend, etc.). That is, until the negative rights conception of liberty was used by activist judges (in the 1800's) to constrain all sorts of State action.
I totally agree; it's weird that libertarians shun the non-economic collective's (representative government) determinations and exercises of power but seem to embrace economic collectives' (markets, corporations) exercising of power over individuals. It seems to me that the ideal of democracy and the promise of representative government is that no matter one's resources, one has a voice coequal with everyone else's. This balances the unequal economic power exerted by individuals and groups who have far more wealth and resources.
Libertarianism puts all of society's eggs in one basket - that the exercise of power based upon distribution of resources leads to the most freedom. This is not rational; individuals and corporations inherit accumulated wealth without 'earning' it, thus a good portion of society's resources are deployed by those who (in a libertarian rationalization of economic efficiency), by not having earned the resources, do not have any better chance of efficient (socially productive) use of those resources than a random person. Libertarians may say that such aggregations of wealth are exploited by entrepeneurs (those who can and do efficiently use resources); but there is no grounds for believing that those with access to such accumulations are the best suited, rather, it is those who have positioned themselves in(or have lucked into) social networks with access. It is in the breaking up these accumulations that libertarians charge liberals with socialist redistribution programs.
If redistribution of wealth is all that it takes to be socialist, then we're all socialists. However, the redistribution of resources in an American liberal regime doesn't necessarily destroy the amount of privately-held property, rather, it ensures (or attempts to ensure) that the philosophical ideals of meaningful liberty are met. When the least of us need not worry about housing, food or a deleterious environment then society can go about distributing the balance of resources via free markets.

Ack, long post. Well, I'll let you folks take it apart.

Posted at May 21, 2008 2:19 PM in response to The Liberal-Libertarian Divide

CA can always sue the EPA for withholding the waiver; depending on the authorizing statute, if the EPA's reasons for withholding the waiver fall outside its expertise (i.e., that it determined that granting the waiver would do more harm than good)or are lacking, a court would likely force the EPA to grant the waiver.

I would advocate that Congress amen the EPA's organic statute such that EPA may not override stricter state standards for any type of regulation.

Posted at May 20, 2008 11:35 AM in response to Today's Must Read

The popular vote is such a misnomer - not all the people vote or can vote in the various Dem primaries. Indeed, to call the 'majority of votes cast' number popular implies that the primary process is more democratic than it really is; unlike 'real' elections, the primary system is not meant to necessarily aggregate the preferences of the electorate to produce the winning candidate, but rather to incorporate very imprecisely measured preferences into what is ultimately the party leadership's decision regarding which candidate receives the party's blessing. In essence, the primary is an instrument or tool the party uses to measure intra-party popularity but not to necessarily be the final word on who gets the nomination.
For Clinton to claim that the popular votes matters at all is quite disingenuous; it seems that a short while ago she urged superdelegates to override 'popular' party opinion. More troubling is that she ignores caucus states because caucuses supposedly distort the 'popular will'. Well, so does the inclusion of both open and closed primaries, numbers from primaries with different rules and MI and FL (since those states' ballots didn't include Obama and he never campaigned in either state). At any rate, the idea that primary votes represent the party's popular will is hogwash no matter how you measure them; I just hope the party can come up with a better primary system next go-around so we can avoid future primary nonsense.

Posted at May 20, 2008 11:03 AM in response to Obama Winning Popular Vote!!

Mandatory pre-dispute arbitration is problem, and the CA Supreme Court outlined a standard lower CA courts should use in determining whether mandatory arbitration is unconscionable (and therefore void). The decision is: Gentry v. Superior Court of Los Angeles County (CA 2007). The standard is that courts must find both that the contract is procedurally unconscionable (take-it-or-leave-it contracts - the consumer has limited or no bargaining power)and that the substantive terms are unfairly one-sided.
The court also held that the more procedurally unconscionable the contract, the less substantively unfair it needs to be for the whole arbitration clause to be void. The type of contract at issue in the NAF case is one the court pretty much said is flat-out procedurally unconscionable. Therefore the trial court will have to find that arbitration works almost equally in favor of the consumers as it does repeat-player companies. I think the NAF suit was brought because of this new standard; the companies will have to prove not only that their victory rates are not evidence of unfairness, but that arbitration itself does not favor them. Since arbitration is secret and the arbitrators do not typically produce reasoned opinions like courts, there may be little material evidence upon which NAF can rely.
A solution to mandatory arbitration? Congress passes a law allowing judicial review of arbitration clauses. SCOTUS didn't make a Constitutional finding, so Congress can change the Federal Arbitration Act and override SCOTUS holding in Waffle House (the case forbidding state judicial review of arbitration clauses).
Fun fact: though I'm an ardent liberal, the SCOTUS decision forbidding judicial review was written by Breyer and joined by Ginsberg, Scalia (!) and Souter. The only dissenter who would allow review? Thomas!

Posted at April 23, 2008 12:31 AM in response to The Solution to Arbitration?