COMMUNITY COMMENTARY:

Jeremy Oberstein’s article (“Economy continues to crumble,” Sept. 25) is a stark reminder that all politics are local. In the case of housing prices, national politics have a local impact, and how.

Name the top three political issues that get Glendale voters active, and it likely includes at least two housing issues: mansionization, or someone promising to promote Section 8 housing. Housing is the link that ties local politics to national issues.

Closely tied to the American dream of owning a home is the availability of good jobs to pay the mortgage and a good interest rate that will make the mortgage affordable.

Housing and housing prices are the oil that keeps most cities humming. Build more housing and the property tax base increases. Sell homes in a rising market and the city coffers expand. Older homes with a low property tax rate exchange hands to new buyers who will be paying a much higher tax. The city then gets a bonus with the property transfer tax.

What some people don’t know is that the lack of oversight on lending practices fed the speculation engine that higher home prices would continue. But that was not a fluke. Both Democrat and Republican members of Congress have been courted, wined, dined and bought by bankers or their lobbyists.

Since 2000, Fannie-Mae and Freddie Mac, the two largest purchasers of the mortgage loans, have given more than $180 million on lobbying and campaign contributions. According to Common Cause in the 2008 election cycle they’ve given $32 million.

Forty-six percent of that money went to Republicans and 54% of it went to Democrats.

Along the way lots of people made lots of money. The appraiser who got really cozy with the sales agent, the Realtor who got cozy with the mortgage broker, the buyers who bought and flipped houses by selling while speculating, the bankers who packaged the loans and sold it to investors. At the bottom of that institutionalized greed were the practices that permitted it all — no down payments and accepting falsified loan applications.

The lack of oversight and deregulation of the banking sector started in the last year of the Clinton administration and was solidified during President Bush’s first term. You dimply can’t unlink the influence of lobbying and related consulting on legislation that resulted in reduced oversight. Lobbyists and political consultants must get results or their pay dries up. According to the Center for Public Integrity about 600 political consultants were paid $1.2 billion in the 2003-04 campaign year.

Something is awfully amiss when the head of Freddie Mac received compensation of $19.8 million last year, according to the Associated Press (July 18), and when he is expected to get millions this year after the bail-out.

Our democracy is rotting before our eyes. Only through publicly funded campaigns can we restore integrity in politics and confidence from the voters.

We have a housing issue all right. We must start out by cleaning our own house and promote government-funded elections locally or the price of the alternative will send us all to the poorhouse.

 HERBERT MOLANO lives in Tujunga.