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Chicago Tue Aug 23 2011
It's Hard To Take You Seriously....
From a press release from the Chicago Teachers Union
More than 40,000 homes are foreclosed in Cook County each year. Combined with the illegal lay-off of teachers these foreclosures contribute to housing insecurity for thousands of CPS employees and students. As part of its ongoing negotiations with CPS, the Union requested that the Board turn up the pressure on Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, and Deutsche Bank until these institutions agree to write down the mortgage principals and interest rates for all homeowners facing foreclosure within the school district to market value as a part of an affordable and sustainable loan modification program. "The decline of safe and secure homes greatly impacts the overall well-being of the children, educators and their families in our public schools. Their interests are our interests," said Lewis. "We urge the school board to stop doing business with the "big five" banks whose policies adversely impact our schools and neighborhoods.(the emphasis is mine)
Really, the banks should eat all of those losses In order to do business with CPS? I think mathematically alone the losses the banks would suffer would dwarf what they make doing business with CPS.
Is that the role of a union, to dictate who the employer does business with? There are folks who have a hard time feeding their families, why not demand CPS stop doing business with the top largest grocery store chains until they start giving a discount to people who use LINK cards?
What happens if there is a subsequent gain in home prices? I am betting the homeowner gets to keep all of that. How low should mortgage rates go in they eyes of the CTU in order for it to be okay for CPS to start doing business with these banks again?
This reminds me of Die Hard's Hans Gruber asking for the freedom of the nine members of Asian Dawn in Sri Lanka , it isn't going to happen and it's irrelevant to what they are trying to do.
If you are going to win the argument with Mayor Emanuel this is not the place to start.
CL / August 23, 2011 11:52 PM
It's true that CPS could never make this happen, and maybe it's silly for the union to demand it. But the idea of reducing both principals and interest rates isn't silly. It's the only way to stop foreclosures for many people who are underwater, and if we had figured out a way to make this happen in 2008, we would be better off today. Ideally this would happen by allowing bankruptcy judges to modify loans, not through CPS threatening to withhold business... but it's not a ridiculous idea.