Bunning assails housing legislation

Senator Jim Bunning (R-Southgate) spent much of Thursday reiterating his criticism of two pieces of housing legislation before the Senate. During a morning appearance on CNBC’s “Squawk Box,” Bunning had harsh words for proposals by Senator Chris Dodd (D-Connecticut) and blamed Federal Reserve Chairman Benjamin Bernanke for “sitting on his hands” while foreclosures skyrocketed.

Dodd’s proposal before the Senate Banking Committee would offer mortgage brokers insurance for $400 billion of refinanced mortgages. This morning, Bunning criticized Dodd’s bill and the Connecticut Democrat’s handling of the hearings surrounding it.

“It seems like a $400 billion bailout…It does not help people stay in their homes, and that is the whole object of trying to help the distressed credit market,” said Bunning on the program. “Senator Dodd would not allow any dissenting opinions. He’s asked all these people who are in favor of the bill to testify, and they are all academics. Next week, we’ll have a hearing that will have the regulators in and we will hear how difficult his proposition is to regulate.”

A longtime critic of the Federal Reserve, Bunning argued that institution had not done its job with regard to the mortgage crisis. He singled out current chair Benjamin Bernanke and his predecessor Alan Greenspan for not listening to concerns emanating from the Senate Banking Committee on which Bunning sits.

“[Greenspan] put us in the ‘90 recession. He put us in the 2000 recession, and he allowed this big housing bubble to accumulate, knowing full well the Banking committee was watching the store and screaming to the fed that we were going to have this big credit debacle,” said Bunning. “Bernanke has sat on his hands for a year and a half and watched it go down the tubes. ”

A separate piece of mortgage-related legislation cruised through the Senate today, 84-12. Supporters say the bill will provide some relief, but many – including some who voted for it – criticized the bill for its extensive focus on tax relief for home builders. Bunning – who earlier cast the sole vote for cloture on the bill – voiced his concerns with the legislation in a statement released after today’s approval.

“Instead of providing billions of dollars in bailout money to homebuilders and banks, we should be working to cut taxes and create opportunities for economic growth that will put more money back in the pockets of working families for them to spend on things like housing. One proposal I attempted to offer to the bill would have helped more people keep their homes by cutting taxes on home mortgage refinancing. Unfortunately the managers of the bill would not allow a vote on my amendment,” said Bunning in the statement. “This bill hurts responsible homeowners and rewards those who made bad decisions. The federal government should not be in the business of bailing out homeowners and banks who gambled on home prices and lost.”