Obama Jobs Speech Must Address Foreclosures, Small Business

President Obama's much-anticipated jobs speech will be incomplete if the president fails to include a plan to grapple with the ongoing foreclosure crisis and stabilize the housing market, policy experts at The Greenlining Institute said today.

"The ideas being talked about, like infrastructure spending and tax cuts, may help, but they can't do the job by themselves," said Greenlining Institute Executive Director Orson Aguilar. "We still have millions of people worried about losing their homes to foreclosure, and that's a dead weight on the housing market and the whole economy. The president and Congress must address this if they're serious about jobs."

Aguilar added that millions more may not be on the brink of foreclosure, but are deeply underwater, owing far more than their homes are now worth. "This isn't complicated," he said. "Economists say that consumer spending is crucial, and people who are badly in debt don't spend. Principal reduction can make it possible for many homeowners to refinance and let consumers start spending again, stabilizing neighborhoods and reviving housing and construction.

"Fannie Mae and Freddie Mac back nearly half the nation's mortgages but haven't been willing to allow principal reduction," Aguilar noted. "That needs to change, and quickly."

Aguilar also urged that tax and infrastructure proposals be geared toward small businesses. "Small businesses are the real engine of the economy, and they got very little from the bailouts and stimulus in 2008 and 2009," he said. "We can't ignore small business and have a healthy economy."