Eminent Domain for Underwater Mortgage Loans

The eminent domain plan for underwater mortgage loans, developed in the wake of the crash of 2008 and subsequently disseminated by the Federal Reserve Bank where Hockett worked, supplied a missing market the absence of which was harming both homeowners and lenders alike. Owing to improvidently drafted securitization contracts, loan servicers and homeowners were prevented from completing even NPV-positive loan writedowns which, owing to high default rates among underwater home loans, would literally benefit creidtors and debtors alike, not to mention neighborhoods, municipalities, and the national and global economies. Hockett's plan levered municipal eminent domain authority to afford means by which creditors could buy back loans, write them down, and avoid any further foreclosures. The plan generated much national attention until late 2014, by which time QE3 had raised home prices 'above water' again.

Image: Hockett debating his eminent domain plan with future FHFA Chair Mark Calabria.
  1. Paying Paul and Robbing No One: An Eminent Domain Solution for Underwater Mortgage Debt
  2. It Takes a Village: Municipal Condemnation Proceeds for Value-Salvaging Mortgage Writedowns
  3. We Don’t Follow, We Lead: How New York Will Save Properties by 'Condemning' Them
  4. A Federalist Blessing in Disguise (w/ John Vlahoplus)
  5. Accidental Suicide Pacts and Creditor Collective Action Problems
  6. Six Years On and Still Counting: Sifting Through theMortgage Mess
  7. Bailouts, Buy-Ins, and Ballyhoo
  8. Post-Bubble Foreclosure-Prevention and –Mitigation Options for Seattle
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Columns, OpEds, Occasional Journalism

I'm no Marx or Keynes, but like them I do try to accompany most of my scholarly, policy advocacy, and legislative work with more accessible journalistic companion pieces. Here are some of my regular columns for Forbes, The Hill, FT, and Huffington Post, along with other occasional journalism.

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The Green New Deal

The Green New Deal initiative begun in 2018 marked the beginning of a return to ambitious public-private coordination in the cause of rebuilding the American economy along more just, productive, and sustainable lines. Hockett worked with Rep. Ocasio-Cortez and her team from the start on the GND Resolution introduced to Congress in early 2019, then on the initiative's finance plan as well as much follow-up legislation found in the 'Legislation' Module of this site.

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