California Lt. Governor: This Aggression Against Our Expropriation Of Private Property Will Not Stand, Man

Tyler Durden's picture

It is not news that California, despite what the money laundering practices aided and abetted by the NAR at the ultra-luxury segment of housing may indicate, is and has been for the past 5 years neck deep in a massive housing glut (with millions of houses held off the books in shadow inventory), which together with a complete economic collapse of this once vibrant economy, which happened to be the world's 7th largest, led various cities to resort to the socialist practice of expropriation, or, as it is known in the US, eminent domain, whereby a citizen's rights in property - in this case their home - are forcefully expropriated with due monetary compensation, naturally set by the expropriator. It is also no secret, that Wall Street, which has the most to lose by handing over property titles on mortgaged houses in exchange for money that is well below the nominal value of the mortgage, is not happy about this draconian quasi-communist measure, and has apparently told California to cease and desist. It is, apparently news that California has had enough of these bourgeois capitalist pawns, and has decided to, appropriately enough, channel El Duderino, and to tell Wall Street that this aggression against forced socialist expropriation, by broke deadbeats, will not stand... man.

From Reuters:

California Lieutenant Governor Gavin Newsom says he wants the U.S. Department of Justice to investigate "threats" against local communities considering using eminent domain to seize and restructure poorly performing mortgages to benefit cash-strapped homeowners.


Newsom sent a letter on Monday to U.S. Attorney General Eric Holder asking federal prosecutors to investigate any attempts by Wall Street investors and government agencies to "boycott" California communities that are considering such moves.


"I am most disturbed by threats leveled by the mortgage industry and some in the federal government who have coercively urged local governments to reject consideration" of eminent domain," he wrote in a letter, a copy of which was provided to Reuters.


Newsom, a Democrat who was previously mayor of San Francisco, warned the influential Securities Industry and Financial Markets Association in July to "cease making threats to the local officials of San Bernardino County" over the proposed plan to seize underwater mortgages from private investors.


Some towns in San Bernardino County, which is located east of Los Angeles, have set up a joint authority that is looking into the idea of using eminent domain to forcibly purchase distressed mortgages. Rather than evict homeowners through foreclosure, the public-private entity would offer residents new mortgages with reduced debts.


Newsom said in the letter on Monday that while he is not endorsing the use of eminent domain at this time, he wants communities in California to be able to "explore every option" for solving their mortgage burdens "without fear of illegal reprisal by the mortgage industry or federal government agencies."

This is what Lebowki Newsom had said previously:

Today California Lieutenant Governor Gavin Newsom calls on the Securities Industry and Financial Markets Association (SIFMA) to cease making threats to the local officials of San Bernardino County.


SIFMA has attacked the idea of local governments using existing law to help families remain in their homes and keep their communities viable.


"Communities have been ravaged by the housing crisis and the financial sector has had long enough to fix the problem they helped create," Newsom said. "We cannot let another day go by while families are forced from their homes. We must think big and help our local governments develop solutions - because the industry and federal government have not."


"This may be an aggressive idea, but communities such as San Bernardino, Chicago and others have no choice in these desperate times," Newsom continued. "We cannot allow Wall Street, who exploited the housing market for financial gain, to kill an idea before it is given a fair hearing."


"The true injustice of the last few years is that as banks were bailed out and government claimed it has done all it can, the homeowner, the backbone of our communities, has received nothing but eviction notices," said Newsom. "We need to help the people that government bailout programs have left behind - ordinary folks that have worked hard to keep their homes even as values plummeted."


"The economic power that would be unleashed if consumers are untethered from the anchor of these underwater mortgages would result in a return of consumer confidence, economic grow and job creation."


San Bernardino County Chief Executive Officer Greg Devereaux, joined by the cities of Ontario and Fontana, have set up a JointPowers Authority (JPA) to explore options to keep people in their homes before they are in foreclosure.


"I applaud the leaders in San Bernardino for thinking and acting big to protect their communities," said Newsom. "Greg Devereaux' communities are some of the hardest hit in the country and his leadership on this issue should be rewarded with support not the threats of a Washington, DC interest groups that are protecting Wall Street."


"The Washington, DC special interest groups needs to back off," said Newsom. "We owe it to homeowners everywhere to see if the solutions being discussed in San Bernardino will work."

Because it's "only fair." In other news, obviously socialists are not golfers. They may be, however, housebroken.

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FubarNation's picture

Commence the BL quotes and references!

STFU Newsom!

Pladizow's picture

Yeah, well, you know, that's just like your opinion, man -

Precious's picture

NAR is the biggest whorehouse outside Nevada and Newsome is its biggest John.

AldousHuxley's picture

"private property" protection legally and forcefully is define by the state. so how can you argue against the defining authority?


you can't.


and nothing is ever private.....real estate taxes.



insanelysane's picture

real estate taxes which then become liens on a property.

goldfish1's picture

California does what it wants. Fukk wall street.

A Nanny Moose's picture

These are just legal fictions and ex post facto justifications of theft. Theft is either universally wrong, or it is universally right. If it was universally right, it would be voluntary (mutually agreed upon), and no longer called theft.

Furthermore, your comment presupposes that The State is the only means of enforcing private property rights. It amounts to the linear thinking, not dissimilar from the idea that freeing slavesn would have prevented cotton from being picked? It doesn't matter. Slavery is wrong. If all men were created equal, why are a few men allowed to have all the guns, and why is it legitimate for them to commit acts that would land the rest of us in jail?

pufferfish's picture

"...nothing is ever private..."


+1 Quote of the day.


The converse also this applies. The state manipulate for & against.


The headless arbitrary meddler.


Gringo Viejo's picture

Proposition 13, the Jarvis_Gann initiative to limit rises in property taxes, was passed by the people of California in 1978. Jerry "Moonbeam" Brown was the Governor then and the people, that were seeing 10% year over year property tax increases, rose up en masse and said "Enough!' The State of California fought this all the way to the SCOTUS, where they lost in 1992....for14 freakin'years they fought to retain their right to squeeze the people to whatever degree they wished. Now...guess who's Governor today and guess what he's trying to overturn?

We are in thrall to the communists, the california dream has become the california nightmare.

Son of Loki's picture

Cali went from one extreme over to the other with Prop 13.

It's not uncommon but with time, market forces tend to move these extremes back to the median. Taxing $2 million houses as if they were still $230k will not last. The Parteee may be  over but I can't blame them for fighting. I tried fighting property taxes and lost double....stuck with higher taxes and a Fat Legal bill to boot !


Many newer neighborhoods (the ones built the last 10 years with zero down) with city hall expansions, new fire dept, police expansion, etc....are raising taxes rapidly to pay for all the "new stuff."


My taxes shot up from $7,200 pa to over $12,500 pa in five years despite fighting the good fight.

californiagirl's picture

I couldn't agree more!  Trying to run a business in this state is becoming ridiculous.  And since surveys were showing that the people were going to vote against the high-speed rail, he did a run-around on that legislation as well, sneaking it through the legislature and already issuing over $2 billion in bonds.  It this goes like a typical Caltrans project, it will end up costing us a half trillion or more by the time it is completed.  For those of you not living in California, you will also be paying for this California disaster since they expect most of the money to come from the federal Grants and loans. They say that the average ticket is supposed to be $81.  Hah! The cost will be more like $8,000 per seat!

facepalm's picture

all the Dude ever wanted was his rug back

Chuck Walla's picture

NAR is the biggest whorehouse outside Nevada and Newsome is its biggest John.


The Dude abides....



ChubbNut's picture

Careful man there's a beverage here!

ZeroAvatar's picture

I'm fixin' to make m'self a white russki!


I am NOT Chumbawamba!

Big Slick's picture

Say what you like about the tenets of National Socialism, Dude, at least it's an ethos.

Cognitive Dissonance's picture

The last line delivered by The Dude in the clip. " least I'm housebroken."

Broken by the housing Ponzi. Speaks volumes!

A Nanny Moose's picture

Getting medieval with a pair of pliers and a blowtorch.

williambanzai7's picture

Why don't we just stop bailing out Wall Street and allow the whole sewer, consisting of shitty banks, shitty deals and shitty borrowers, to implode naturally.

Bastiat's picture

Exactly what I was saying in 2008. We'd be well into a fresh start now.

MachoMan's picture

you and the rest of america...  now everyone figured out how poor we really are and no one wants to bite the shit sandwich.

A Nanny Moose's picture

The irony is that Gavin would screw pensioners, by screwing the banks. Where does he think CALSTRS and CALPERS keep some of their money?

Something about serving two masters applies.

californiagirl's picture

Gavin is a moron and brain donor if he thinks this will help the poor people.  What bank in their right mind will want to underwrite mortgages in California without a hefty downpayment and 800 FICO score?  Mortgages will be even harder to get, blocking even more people from the dream of home ownership, except his wealthy elitist friends, of course! 

A Nanny Moose's picture

Gavin is a zombie looking for brains.

There, fixed.

stormsailor's picture

july 2007 would have imploded the banks, but that was the first time the fed lowered rates, in a suprise announcement at 8:30 on opex.  news had leaked out because the last hour of thursday the /es futes shot straight up green.


it would have tanked then, and we would be more than 5 years into the recovery.  all of us that were savers would have been justly rewarded, and all the overreaching, debt-ridden bastards would have got what happens to people when they fuck a stranger in the ass

Chrome Child's picture

Dude, +1.


At least this story isn't about the Chinaman who pissed on the Dude's rug...

Temporalist's picture

WB7 that is craziness!  Don't you think that if that were a good idea one of the two awesomestest presidential candidates would have suggested it?

Overfed's picture

I know. He sounds just like that crazy Ron Paul! :-)

Stoploss's picture

It would then be called capitalism.

And we just can't have that. Duuude..

resurger's picture

What will be the fucking catalyst so that they implode naturally WB7?


prains's picture

Ron Paul ? just a thought more than a vote for

californiagirl's picture

Stopping all the trillions in back door bailouts would do it.

EscapeKey's picture

Because our chosen career politicians receive donations from institutions which depend on said politicians giving them free money.

ptoemmes's picture

Who is this "we" you speak of? ;-)

I ain't giving them anything.

Wait...I'm a unwilling taxpayer....damn.

williambanzai7's picture

All that was accomplished in four years was we saved some heavy duty Wall Street welfare Queens. Team Bush came up with the idea and O'Bombo executed it brilliantly.

Don't let anyone convince you otherwise: both parties share the blame for this clusterfuck.

And now they want everyone to vote for their guys.

Fuck all of them.

A Nanny Moose's picture

Paddle faster, I hear banjoes.

Cognitive Dissonance's picture

I just knew little Timmy had no wood and thus was overcompensating. Better to think that then to acknowledge we are "ruled" by sociopaths.

Thanks for clearing that up Bill.

Calmyourself's picture

Priceless, fluke holding the baby is fiction however..  The rest spot on..  Absolutely priceless..

ShrNfr's picture

With a face like that, I am surprised she has to worry about birth control.