STATE OF OKLAHOMA

1st Session of the 52nd Legislature (2009)

SENATE CONCURRENT
RESOLUTION 1	By:	Johnson (Constance) of the Senate

			and

		Shumate of the House

AS INTRODUCED

A Concurrent Resolution memorializing Congress to enact a Homeowners and Banks Protection Act for specific purposes; and directing distribution.

WHEREAS, the ongoing financial crisis involving home mortgages, debt instruments of all types and the banking system of the United States has set off an economic collapse with the potential to be worse than the Great Depression of the 1930s; and
WHEREAS, millions of Americans are daily facing foreclosures and loss of their homes over the coming months; and
WHEREAS, the hedge funds which spread this financial collapse among markets worldwide, by dominating speculation in all those markets, are now going bankrupt and demanding, and in increasing instances receiving, government bailout of their securities and derivatives.  The nominal value of the derivatives based on mortgages alone is the size of the combined gross domestic product (GDP) of the nations of the world; and
WHEREAS, this financial crisis threatens the integrity of both federal and state chartered banks, as typified by the run on deposits of Countrywide Financial Corporation in California on August 16, 2008, and could wipe out the life savings of far too many Americans and drastically undermine the economic stability of our states and cities; and
WHEREAS, under similar circumstances in the 1930s, President Franklin D. Roosevelt successfully intervened to protect banks and homeowners, addressing Congress with a "declaration of national policy" on April 13, 1933, which stated "that the broad interests of the Nation require that special safeguards should be thrown around home ownership as a guarantee of social and economic stability, and that to protect homeowners from inequitable enforced liquidation in a time of general distress is a proper concern of the Government."
NOW, THEREFORE, BE IT RESOLVED BY THE SENATE OF THE 1ST SESSION OF THE 52ND OKLAHOMA LEGISLATURE, THE HOUSE OF REPRESENTATIVES CONCURRING THEREIN:
THAT the Oklahoma Legislature hereby memorializes Congress to take emergency action to protect homeowners and banks by enacting a Homeowners and Banks Protection Act specifically to:
1.  Establish a federal agency to place federal and state chartered banks under protection, freezing all existing home mortgages for a period of time, adjusting mortgage values to fair prices, restructuring existing mortgages at appropriate interest rates and writing off speculative debt obligations of mortgage-backed securities, financial derivatives and other forms of financial pyramid schemes that have brought the banking system to the point of bankruptcy;
2.  Declare a moratorium on all home foreclosures for the duration of such transitional period, allowing families to retain their homes.  Monthly payments, the equivalent of "rental payments", shall be made to designated banks, which can use the funds as collateral for normal lending practices, thus recapitalizing the banking system.  These affordable monthly payments will be factored into new mortgages, reflecting the orderly deflating of the housing bubble, the establishment of appropriate property valuations and reduced fixed mortgage interest rates.  While this may take several years to achieve, in the interim period no homeowner shall be evicted from his or her property, and the federal and state chartered banks shall be protected in order to resume their traditional functions of serving local communities and facilitating credit for investment in productive entities; and
3.  Authorize governors of several states to assume the administrative responsibilities for implementing the program, including the "rental" assessments to designated banks, with the federal government providing the necessary credits and guarantees to assure the successful transition.
THAT a copy of this resolution be distributed to the President of the United States and to each member of the Oklahoma Congressional Delegation.

52-1-85	LKS	11/25/2008 10:17:24 AM