A deepening crisis

Sunday, March 9, 2008 | 3:09 a.m.

The foreclosure crisis has shaken the nation’s economy, and the Bush administration’s response hasn’t inspired confidence. The White House, for the most part, has been content to let the market work itself out — no matter that millions of people are in jeopardy of losing their homes.

On Tuesday Federal Reserve Chairman Ben Bernanke called for a “vigorous response” to the crisis, adding “more can, and should, be done.”

That more should be done is obvious to anyone in Las Vegas — neighborhoods here are filled with empty, foreclosed homes. Nevada has the ignominious distinction of leading the nation in the number of foreclosures per capita.

Last year the White House made great fanfare of sponsoring a mortgage industry group that trotted out several feel-good, do-little proposals, including phone hotlines and vague promises to work with homeowners in arrears. The administration has bragged that in the first seven months of the program, it has helped more than 630,000 homeowners who have subprime loans. But the overwhelming majority of those “helped” received only more time to catch up on late payments, which is merely a stay of the inevitable foreclosure.

On Thursday, Housing and Urban Development Secretary Alphonso Jackson came to Las Vegas and unveiled the administration’s latest plan, which will temporarily ease the rules to help more people qualify for federally insured loans. But that plan is like the rest: too little, too late.

In a meeting Thursday with the Las Vegas Sun’s editorial board, Jackson said he was “between a rock and a hard place” in trying to address the problem.

“We want the free-market system to work,” he said, “but in the process it has hurt a lot of people.”

While administration officials are straddling the fence, the nation continues to slide deeper into the economic mire because of the foreclosure crisis. USA Today reported last week that financial research service Moody’s Economy.com listed Nevada as one of five states already in recession.

In the meantime, the White House is working to kill comprehensive proposals that might actually provide relief, such as one offered last month by Senate Majority Leader Harry Reid of Nevada.

Reid’s plan, which would help cities and homeowners rebound from the crisis, was attacked largely because of a provision that would change bankruptcy rules to help people caught in the foreclosure crisis.

The White House’s obstructionism is unconscionable. This is time for bold action. If the White House can’t provide that, it should get out of the way and let Congress work.