Congress Rejects Measure to Help Struggling Families Amid Shower of Special Interest Money

When the House of Representatives passed a sweeping financial reform
package last week, it rejected several high profile amendments,
including the so-called "cramdown" provision. Introduced by Rep. John
Conyers (D-Mich.), whose district has one of the highest foreclosure
rates in the country, the provision would temporarily allow bankruptcy
judges to adjust the value of a mortgage to reflect the current value
of the home.

In March, the House passed an identical
proposal as a stand-alone bill, the Helping Families Save Their Homes
Act of 2009. But the same chamber rejected it this time, thanks to
nearly four dozen members of Congress who switched their position on
the issue since the spring.

In fact, 45 House members
changed their vote from an 'Aye' to a 'Nay' on the mortgage provision
when it was voted on Friday. This same group of House members has
received nearly $3.4 million from the real estate, commercial banking,
and credit union industries during the last election cycle and so far
this year, according to an analysis of data from the nonpartisan Center
for Responsive Politics. The vote-switching members received more than
$900,000 from these industries in the first nine months of this year
alone. All three industries have been fiercely opposed to the
provision.

"There is no question this provision would
help keep families in their homes," said Common Cause President Bob
Edgar. "But the banks don't want to have to face more losses for all
their risky lending, so they have showered Congress with campaign cash."

Some
of these members also represent districts in areas of the country
hardest hit by the foreclosure crisis. Rep. Jim Costa (D-Calif.), for
example, represents parts of southern California that have been at the
epicenter of the foreclosure crisis. He received $68,900 from these
industries over the last three years and his district ranks as the 19th
hardest hit district in the country as measured by the foreclosure
rate. Rep. Mario Diaz-Balart (R-Fla.), who received $146,934 and
switched his position on the mortgage provision from March, represents
a district covering portions of Monroe and Miami-Dade counties. Rep.
Diaz-Balart's district ranks as the 23rd hardest hit. And Rep. David
Scott (D-Ga.), whose district in suburban Atlanta covers Fulton,
Douglas and DeKalb counties and ranks 27th in foreclosure rates,
switched his vote as well. He received $158,885 from these industries
over the past three years.

"Good people caught in this
economic downturn are losing their homes because of campaign
contributions," commented Nick Nyhart, president and CEO of Public
Campaign. "It's time to end this immoral pay-to-play system that lets
the banks 'own the place.' Congress should adopt the Fair Elections Now
Act," said Nyhart, referencing Sen. Dick Durbin's (D-Ill.) words
earlier this year when a similar "cramdown" provision was defeated in
the Senate.

The Fair Elections
Now Act is a comprehensive campaign finance proposal that mixes small
donations and public financing and frees federal Congressional
candidates from the pressures of fundraising. Bills have been
introduced in the Senate by Sen. Durbin, the Assistant Senate Majority
Leader, and in the House by Rep. John Larson (D-Conn.), the Democratic
Caucus Chairman.

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Common Cause
is a nonpartisan, grassroots organization dedicated to restoring the
core values of American democracy, reinventing an open, honest, and
accountable government that works for the public interest, and
empowering ordinary people to make their voices heard.

Public
Campaign is a non-profit, non-partisan organization dedicated to
sweeping campaign reform that aims to dramatically reduce the role of
big special interest money in American politics.