Moratorium NOW! Coalition fights to stop foreclosures and evictions

Michigan has been in an economic depression for several years due in large part to restructuring, plant closings, buyouts and layoffs in the auto industry. More than 400,000 jobs have been lost in the state since 2001. Now, that economic crisis has extended nationwide.

Kim Greene, left, of the Moratorium NOW! Coalition speaks out at Detroit demonstration against mortgage bankers. WW photo: Alan Pollock

According to a report issued on June 5 by the Mortgage Bankers Association, approximately one of every 11 mortgages in the U.S. was past due or in foreclosure at the end of March. Both the rate of new foreclosures and late payments on home mortgages are the highest on record since the MBA began collecting data in 1979.

As home values have declined, homeowners’ equity in their homes, which is considered the single biggest asset most workers have, has plummeted 46.2 percent. This is the lowest level on record going back to the end of World War II.

The MBA report acknowledges that the foreclosure crisis has spread beyond the predatory subprime mortgage fiasco. Even people with fixed mortgages are now unable to keep up with payments.

Falling home values have left many homeowners with mortgages in excess of the value of their homes. Housing prices have fallen 16 percent from their peak in 2006. Some economists expect that to further bottom out to a 25 percent decline.

With the capitalist economy teetering on the brink of disaster, many workers are faced with adjustable rate mortgages that have reset to higher, often usurious rates, at the same time that the cost of gasoline, utilities, medical care and food has soared. Wages are not keeping pace with inflation. High unemployment and the high cost of living have contributed to a growing crisis for poor and working people around the U.S.

It is in this context that the struggle in Michigan for a moratorium on foreclosures takes on greater importance. The Moratorium NOW! Coalition to Stop Foreclosures and Evictions is organizing around the state to win passage of SB 1306, a two-year moratorium introduced into the Michigan Legislature by state Sen. Hansen Clarke.

In 2007, activists with the Michigan Emergency Committee Against War and Injustice began to popularize the idea of a foreclosure moratorium based on the emergency powers invested in the governor by the state constitution during times of disaster. Demonstrations were held at the state capitol in Lansing demanding that Gov. Jennifer Granholm declare a state of economic emergency and impose a moratorium to stop foreclosures and evictions.

MECAWI activists pointed to the Great Depression of the 1930s as the basis for this demand. During that time, a moratorium on foreclosures was enacted and renewed for a five-year period in Michigan. Moratoriums were also in place in 25 other states. The moratorium was upheld as constitutional by the U.S. Supreme Court, which ruled that in times of economic crisis the right of workers to their homes superseded the constitutional contract rights of the banks. That ruling is still on the books today.

The struggle has taken on renewed energy with the introduction of SB 1306. Coalition organizers took to the streets of downtown Detroit on June 6 with a protest outside of several banks—Chase, National City and Charter One—all of which participate in the record foreclosures taking place throughout Michigan. The protesters chanted, “Home foreclosures are a crime—make the bankers do the time!” One worker said she heard the demonstration all the way on the 15th floor of the building where her office is located.

This week the coalition took the U.S. Department of Housing and Urban Development into federal court. Coalition lawyers challenged HUD’s policy of collaborating with the banks and mortgage companies to evict foreclosure victims from their homes. HUD violates their own rules that mandate working with these individuals to allow them to continue to occupy their homes. In these FHA-insured homes, the government makes up any losses the bankers may suffer.

On June 14 the coalition is holding a town hall meeting where Sen. Hansen Clarke will hear testimony on how foreclosures, evictions and declining neighborhoods are affecting people in communities throughout Michigan. A statewide organizing session preceding the meeting will map out plans for taking the campaign across Michigan, culminating with a mass demonstration when the legislature reconvenes in September.

For more information, contact the coalition at 313-319-0870, moratorium@moratorium-mi.org, or visit www.moratorium-mi.org. Donations can be sent to the Moratorium NOW! Coalition at 23 E. Adams, 4th Floor, Detroit, MI 48226.