McCain advisor elaborates on mortgage plan

10/08/08 Mitch E. Perry
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As Wall Street’s tumble continues, John McCain proposed during last night’s debate a $300 billion plan authorizing the Treasury Secretary to buy the mortgages of homeowners in financial trouble and replace them with more affordable loans.

Senior Policy Advisor Douglas Holtz-Eakin today spoke with reporters to give more details about the plan.

McCain announced the plan while responding to a question from an audience member at the debate. Some analysts criticized not the proposal itself, but the way McCain introduced it. An Associated Press reporter asked Holtz-Eakin why he didn’t introduce the legislation when Congress was debating the $700 billion financial bailout package.

Holtz-Eakin said McCain hopes his plan will offset some of the $700 billion dollars to purchase securities on the market. And he said even if homeowners were delinquent on their mortgages they would be eligible for the plan.

Asked where the $300 billion would come from, Holtz-Eakin said it could come from a number of places – not necessarily from the $700 billion bailout.

Barack Obama said the bailout plan already gives the Treasury Secretary power to do what McCain has offered – and advisors say Obama recommended such a step two weeks ago.

A senior advisor to McCain, Charlie Black, told the New York Times the idea originated with New York Sen. Hillary Clinton. And the Times reports Clinton borrowed it from a Depression-era New Deal agency, the Home Owner’s Loan Corporation.

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