Monday, January 14, 2008

Why Does Feddler Support Sub Prime Frank Seddio

Home to Roost
As other politicians respond to sub-prime crisis, Lew Fidler explains why he saw it first

Elie Mystal
January 14th, 2008

Lewis Fidler (D-Brooklyn), the Council member who is also the general counsel for 1-800-LAW CASH, sees two reasons to keep the Council officially part-time.

The first is practicality.

“The idea that people are going to come into a term-limited office, give up their vocation for eight years, give it their all, still pay college tuition and all that stuff, and then go back to the farm? It is just not realistic,” he said.

But just as important, Fidler says, is avoiding isolation in what he calls the ivory tower of the government world to better serve constituents. Fidler credits his private legal practice in Brooklyn as the reason he predicted the collapse in the sub-prime lending market two years ago, long before market analysts and government officials from Wall Street to Washington caught on to the problem themselves.

Fidler estimates that 85 percent of the real estate closings he participated in before he got to the City Council involved some type of sub-prime or balloon rate loan.
“We were encouraging people to do it,” he said.

Later, Fidler represented some of those same clients at foreclosure proceedings.

“I saw the beginning, I saw the process, I saw the end, and I think I saw reality setting in,” he said.

In 2005, Fidler joined with Council Member Leroy Comrie (D-Queens) in an attempt to get publicity for what he was already calling a looming crisis, but they could not obtain government funding to help affected homeowners.

As the foreclosure crisis deepened—especially in his home turf of Canarsie, which Fidler called “ground zero” for the mortgage foreclosure crisis—he started passing out fliers to other Council members with a block of text explaining the problem and his head superimposed on a movie poster from the Disney film Chicken Little. That caught his colleagues’ attention.

Fidler was able to secure $1 million for the Mortgage Foreclosure Emergency Prevention Program, which matches at-risk homeowners with legal and financial counseling services. That program and others were precursors to the Center for New York City Neighborhoods, the $5.3-million program recently announced by Mayor Michael Bloomberg (Unaffil.), Speaker Christine Quinn (D-Manhattan) and Fidler. The center is geared toward enhancing the city’s financial educational and counseling services.

Many proposed remedies, such as stiffer penalties for predatory lenders or an adjustable rate freeze, are beyond the purview of city government. But Fidler is not content to simply wait for a market correction.

“I’m a Democrat, I believe this is a government problem,” he said.

Fidler hopes that the national politicians now paying attention to the sub-prime market remember that local communities have been suffering from the foreclosure crisis for years.

And he also would not mind if his colleagues in government remembered his long-standing advocacy on the issue.

“It is funny to watch when Rev. [Jesse] Jackson comes to New York. I see my colleagues crowding around him as he gives the same speech I gave two years ago,” Fidler said. “It’s like they all found religion.”

Fidler will be term limited out of his Council seat in 2009. But though he is interested in continuing in politics, he says he has made no decisions about what he might run for next. “I’m not running for anything in particular, and I am not retiring,” he said.

But even if he had already been in higher office, Fidler pointed out, he would not necessarily have been able to do more to stop sub-prime lending and avert the current crisis. Just trying to convince his fellow Council members was trouble enough, he said.

“I don’t think I would have been able to get that accomplished,” Fidler said. “If I had to sell 150 colleagues in Albany, or 435 colleagues in Washington on passing legislation to end sub-prime lending, I think they would have taken me out to the loony bin.”

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