Beyond the Dome

In Brooklyn, N.Y., McCain, who has been hammered by his Democratic presidential rivals for not doing enough about the housing crisis, proposed a housing plan that would, among other things, offer Federal Housing Administration-backed loans to homeowners who meet strict conditions.

Meanwhile, in Gary, Ind., Obama laid out his own plans for a $30 billion second stimulus package aimed at the housing crisis, including a $10 billion “foreclosure prevention fund” to pay for counseling for financially distressed families and help them sell their homes.

McCain’s plan was closer in scope to a housing plan the Bush administration announced yesterday, while Obama’s preference is a broader bill being developed by Democratic Sen. Christopher J. Dodd of Connecticut. All would, at some level, allow the FHA to insure refinanced mortgages for financially strapped homeowners.

Maybe Obama’s preference for Dodd’s bill shouldn’t be a surprise, since they’re on the same side of the aisle, and Dodd endorsed Obama shortly after ending his own White House race. But keep in mind that Dodd isn’t just your run-of-the-mill Obama surrogate. He’s also the chairman of the Senate Banking, Housing and Urban Affairs Committee, and co-author of the housing bill the Senate passed today.

That means that unless the Democrats lose control of the Senate in November – and right now, the electoral math suggests that they won’t – Dodd is one of the key lawmakers a President Obama or a President McCain probably would have to deal with to get their housing plans signed into law. Unless he ends up in Obama’s cabinet, of course.

As a rough way to compare the scope of the plans, Dodd’s aides estimate his bill would help somewhere in the range of 1 million to 2 million homeowners. That’s about the same estimate House Financial Services Committee chairman Barney Frank of Massachusetts provided for a similar bill he’s working on, reports CQ’s Erin McNeill. By contrast, the FHA estimated its plan could reach about 500,000 homeowners.

And on a conference call with reporters, Douglas Holtz-Eakin, one of McCain’s economic advisers, said the “best guesses” are that McCain’s plan would help somewhere between 200,000 and 400,000 homeowners.

That’s somewhat by design, because team McCain wants to make sure the help only goes to homeowners who can afford a new 30-year mortgage and won’t just go into default again.

There won’t be much instant Hill reaction to McCain’s speech, because the key housing players – including Dodd, Frank, and Republican Sen. Richard Shelby of Alabama, the ranking member of the Banking committee – all said they had been too busy to read it. (Funny, Hillary Rodham Clinton responded to McCain’s plan right away. She didn’t like it.)

But judging from Shelby’s comments this afternoon, McCain probably hit it pretty close to the mark of what most Republicans would accept.

“We’ve got to be careful in whatever we do,” said Shelby. “Because there will be some people who we’ll refinance and they’ll be able to meet the payments, and then there will be people who will be back in default. The trick is to figure out who those people are.”