Immigration Reform = Mortgage Finance Reform?!

President Barack Obama, in his fifth state of the union speech, extolled the “rebounding housing market” as one of the measures of the strengthening economy and asked Congress to reform the mortgage finance system in such a way that would keep home ownership within reach of households without risking another taxpayer-funded mortgage finance crisis.

Obama sayeth, “Since the most important investment many families make is their home, send me legislation that protects taxpayers from footing the bill for a housing crisis ever again and keeps the dream of home ownership alive for future generations.” Couldn't have said it/written it better myself.

Unfortunately, you needed to keep your eye on the other walnut shells to follow the rhetorical red ball. While touting the strengthening housing market, Obama also (inferring a DIRECT corollary to housing) called on/asked nicely/will mandate companies working under federal contracts to increase their minimum wage to $10.10 an hour PLUS he also called on Congress to pass legislation that would raise the federal minimum wage to $10.10an hour PLUS the POTUS will press Congress to pass immigration reform. In a remarkable show of inclusion, he somehow bunched all of these as keys to strengthening the housing market.

To be sure, the POTUS didn’t offer details, but among the proposals the administration and Congress are looking at are reforms to the secondary mortgage market companies Fannie Mae and Freddie Mac, which, along with the FHA, back the bulk of home mortgage loans, originated today.

These reforms that would maintain federal backing of conforming mortgage loans to help ensure the availability of safe and affordable financing in good times and bad for a broad swath of responsible home buyers through a government-chartered nonprofit entity while creating conditions that would enable the return of private mortgage capital into the market. (Got all that?)

To keep the economic recovery on track, Obama said he would take steps to speed approval of infrastructure projects, and help households build their retirement through a new savings bond called MyRAs… and, oh yeah, expand Obamacare.

Here’s a crazy idea… why not just pass a bill to keep home ownership within reach of households without risking another taxpayer-funded mortgage finance crisis and let all the other fluff (minimum wage, immigration reform, Obamacare), all rise or fall via their own, separate actions. Yeah, I know, too logical.