December 3, 2007 (LPAC)--Treasury Secretary Henry Paulson keynoted the "Second Annual White House Housing Forum" today by pronouncing the collapsing U.S. economy to be "fundamentally sound," and instructing Congress to take none but trivial actions against the devastating national home foreclosures crisis. He said the Treasury, big banks, and Wall Street's American Securitization Forum would "have a solution in place soon." Paulson, commented economist Lyndon LaRouche, seems to be becoming "Alan Greenspan II"--issuing orders and announcing fraudulent actions to push the stock market up--since "Fed Chairman Bernanke is not up to doing the tough stuff."

In the midst of a global banking crisis and crash of the U.S. dollar, the Secretary of Treasury pronounced the "global economy" to be robust and growing rapidly, U.S. inflation to be contained, job and wage growth strong, and business profits to be healthy--none of which are true. He said that housing/mortgages were the only problem, but that they were creating "credit market problems" which would take a while to work through.

Paulson's and the bankers' "solution" for the moment is "scaling up a national hot line, 1-888-995-HOPE," by which call-takers refer troubled homeowners to mortgage counselors in their area. He said the banks were interested in slowing the mass foreclosures "when the homeowner has the wherewithal to afford the home." "Moving able homeowners into sustainable mortgages" is the watchword. But those homeowners already delinquent on their ARM mortgages, Paulson admitted, were out of luck--"they'll go back to being renters."

And for the role of Congress, the Treasury Secretary was extremely specific--do this, and only this: 1) Appropriate funds for the HOPE counseling centers; 2) Pass the White House's reform of FHA so it can insure new mortgages for up to 100-200,000 households; 3) Pass the White House's bill giving tax relief on mortgage debt wiped out in foreclosures; 4) Pass legislation to increase states' authority for tax-free bonds, so that all states can float bonds to help refinance mortgages.

Incredibly, Paulson placed great stress on these state-issued bonds for refinancing, although it's widely known that those in Ohio, New York, Pennsylvania, and other states have been able to help no more than a hundred or so households refinance, out of tens of thousands facing foreclosure.

Some 225,000 homeowners were hit with foreclosure actions in October alone, and more than 50,000 had their homes repossessed.