Foreclosing on the commons

Washington, DC – If you want to make a lot of money in a less than honest way, the way to do so lies not in stealing purses or cars. No, the secret to getting rich and staying that way is by controlling the commons: control the land and natural resources, with a few armed guards or the world’s only superpower backing your claim, and one can charge a hefty fee for the necessities of life.

Best of all, many will believe your exploitation is benevolent, thankful just to get an adjustable-rate mortgage to a lot of land that was their rightful inheritance just as much as any other human being, but which has fallen into the hands of property profiteers.

Call it feudalism, corporatism or the American way: the rich elite in the US have turned economic exploitation into something of an art. The top one per cent in the United States now control a quarter of the nation’s wealth, double the unhealthy share they held 25 years ago. But while their ability to control legislatures and presidents is impressive, the propertied elite may have let greed get the best of them. In their quest to redistribute wealth from the labouring classes to the idle ones, they have been a bit too successful: the exploited are waking up.

All it took for this stirring from slumber was the criminal collapse of the global economy and, for many in the US, the loss of the very roof over their heads – and the knowledge things weren’t going to be tangibly better anytime soon. Indeed, the foreclosure crisis is still sweeping the United States, with millions of people being thrown out of their homes every year. And yet, presented with a seemingly popular platform to political power – houses for working families, not bailed-out banks – the political class sides with its financiers, to the point that the fraud of electoral politics is now about as obvious as the fraud being perpetrated by the financial industry.

And what a fraud that is.

Foreclosing on the 99 per cent

A recent review of documents from Northern California mortgages in foreclosure found that “99 per cent of them showed some apparent irregularities,” according to the San Francisco Chronicle, with more than 80 per cent containing “one or more clear violations of the law”. Mortgage lenders routinely backdated documents; papers that were supposed to be signed by the owner of a loan were not; affidavits showing lenders informed homeowners of their options prior to a foreclosure were not to be found.

And the story’s the same all over the US, with admitted crimes such as “robo-signing” – in which banks process foreclosures with fraudulent signatures and unverified information – still commonplace. According to the California review, it is also possible that some homeowners “have defaulted on loans to which they never fully agreed to and, further, are being foreclosed upon by lenders that might not even own those loans”. Stories across the nation attest to that.

Some said Barack Obama would do something about this, that – aided by Democratic majorities in the House and Senate – he would throw the moneychangers out of K Street and bring effective regulation back to Washington. Alas, the president has failed to live up to his billing as a Marxist revolutionary. And hasn’t proven to be much of a reformer, either. Given the opportunity to confront capital, Obama instead launched a Super PAC and hosted a beer summit with the wealthiest men on Wall Street. Instead of prosecuting peddlers of fraudulent loans and mortgage-backed securities, Obama treated bank executives as gently as Bush administration torturers – which is to say, better than the working class.

As former Democratic congressional staffer Matt Stoller writes, from the moment he took office, Obama pursued programmes designed not to ameliorate the pain of the average US citizen, but simply “to space out foreclosures so that banks could absorb smaller shocks to their balances”. Like US support for dictators abroad, the justification is always the need to maintain “stability”, never mind the unjustness of the status quo.

The recent much-ballyhooed mortgage fraud settlement with the five largest banks – poor people get prison, rich people get settlements – hasn’t changed that dynamic. Under the deal, the same banks that continue to flaunt foreclosure laws across the country are permitted to get away with paying what amounts to a $25bn fine, a small price to pay given the trillions of dollars in taxpayer-subsidised land titles those banks have stashed away.

But now that the settlement is over and done with, banks can get back to the business of throwing people out of their homes. Indeed, foreclosures – which were already climbing just before the settlement was announced – are expected to increase as a result of the deal, as banks, no longer playing wait-and-see, confidently clear their backlog. If you’ve already been foreclosed upon, potentially thanks to fraud perpetrated by said banks that, thanks to the settlement, cannot be prosecuted, CNN notes that “you may be eligible for a payment of up to $2,000”. In other words, go buy yourself a used Chevy Nova. And sleep in it.

A couple of lousy grand for a wronged taxpayer and a home for the wrongdoer – so it goes in the land of the free. And it ain’t nothing new.

On wealth in the US

Yet there are signs that more and more people are forgoing the charade of electoral politics for the results of direct action.

In some ways, we’re already living in a post-Obama age. Sure, he may still be president, but except for those running liberal magazines or voting in Republican primaries, few still think he’s waiting to reveal his secret progressive identity for the second term. Like other promise-filled politicians, he had a chance to bring about change, but embraced the comfort of the status quo. Instead of defending the people’s property against fraudulent foreclosures, he’s stood by as banks repossess land they often can’t even prove they own, with an eye not towards working class solidarity, but towards financial market stability.

Turning their backs on the false promise of electoral politics, those who would like change to be more than just a politician’s ad campaign are increasingly turning to direct action. And with camps associated with the Occupy Wall Street movement almost entirely evicted at this point – almost all by Democratic mayors – activists are now spanning out into the cities they were occupying to address the housing crisis that is tearing them apart.

In November, activists associated with the Occupy movement took over an abandoned homeless shelter in downtown Washington, DC, that had been sold off to a private developer, hanging a banner that declared it under “community control“. Though removed by police hours later, the issue of public land being sold off to for-profit interests was acknowledged and discussed in the city for the first time in years.

They haven’t all been moral victories, either. This month, government-backed mortgage giant Freddie Mac agreed to allow a resident of Prince George’s County, Maryland, who had been falsely foreclosed upon, stay in her home after activists with Occupy DC took up her cause. Freddie Mac’s announcement was made just an hour after a rally outside its Washington headquarters.

In Minneapolis, community activists rallied to keep Bank of America – a recipient of billions of dollars in federal aid – from evicting 57-year-old Bobby Hull from his home. Sold at foreclosure for under $84,000, roughly a third of the $230,000-plus Hull still owed on the home, the bank yielded to pressure and backed out of the sale, agreeing to negotiate a modification to Hull’s mortgage.

But even as activists rack up successes, their achievements are dwarfed by systemic injustice. Bankers and landlords continue evicting and raising rents, even as more than 18.3 million apartments and homes – one in seven US residences – sit vacant. The number of empty units is up more than 60 per cent since 1970. For each of the United States’ more than 635,000 homeless people, 28 residences are empty and ready to house them right now.

Return to lender?

Land, like power, belongs in the hands of the people. A bailed-out bank, certainly, ought not to have more right to a piece of property than a family that, thanks in no small part to the financial industry itself, finds itself unable to pay off a mortgage worth more than their home. It is ultimately communities, not financial corporations, that make a piece of real estate valuable in the first place – that make a place worth living in.

The political class would say they agree. And the banks, of course. But witnessing the injustice around them and the indifference of their anointed leaders, communities are starting to stand up and assert their rights to their common heritage, declaring that no one, least of all a bank fat off taxpayer money, has the right to tear up their neighbourhood. The system is stacked against them, but, then again, systems that fail to respond to the needs of the masses risk finding themselves replaced.

Charles Davis is an activist and writer who splits his time between Washington, DC, and Nicaragua. He is a contributor to the newswire Inter Press Service and his work has aired on public radio stations across the United States. To read more of his work, visit his website.

Follow him on Twitter: @charlesdavis84