“Meet the new boss, same as the old boss.” Those words, penned and then sung by The Who, were an embittered retort toward an era and a series of administrations in which authority continuously made the same mistakes over and over again. It didn’t matter the political party, the politician or the motivation – there was an understandable lack of confidence and trust in those that held power. It’s a fairly cynical thought but one that certainly seems just as appropriate today as it did then. Don’t get me wrong – typically I don’t find a lot of meaning when it comes to lyrics from 1970s era British rock bands. Most “meaningful” lyrics in pop music or rock music normally constitute a series of questions that never have an answer in the song or in society. Drugs are powerful things indeed.
Fast forward to the last couple years and the “new” and “improved” mortgage industry. The new forms, new regulations, new procedures that we have seen have all been under the guise of reining in an industry that was out of control and largely responsible for the current financial crisis in the United States. To which I appropriately reply “meet the new boss, same as the old boss.” For the most part, none of the changes will make any difference other than increasing the number of forms to be signed, delaying the process and increasing the costs associated with getting mortgages. In other words, the crisis of 2015 or 2020 will not be averted by any of the actions that have taken place in the last couple years.
Prior to the meltdown, there already were rules in place. The problem of five years ago is the same problem of ten years ago and the same problem of our present day. The problem is not disclosures. The problem is not a lack of rules or regulations. The problem is not the Loan Officer or the underwriter, the processor or the escrow agent. The problem is enforcement or a lack of enforcement to be more specific. This is a lasting legacy that is not going to go away. The rules, regulations and disclosures of five years ago, ten years ago etc, were sufficient. The issue has always been a lack of enforcement on the part of the governing bodies that enforce the rules. I get the feeling that somehow these lawmakers feel that once these rules and regulations are put into place that the story ends and everything has been fixed. Without meaningful supervision, purposeful action and genuine commitment to enforcement, these laws are pointless.
As we watch legislators congratulate each other for a job well done as each new law and each new policy is put into place, I can’t help but wonder if they are even more cynical than I am. In other words, do they understand the futility of what they have just “accomplished” or do they truly believe that they have done something for the improvement of the industry and society in general? I am already seeing violations of the new rules that were enacted. As was the case before, there aren’t sufficient resources with the State of Oregon or with the Department of Housing and Urban Development to do anything about it.
Maybe I should write a song. It can’t hurt right?