Republican Platform Addresses Housing Reform

By Sarah Mickelson, NLIHC Director of Public Policy

On July 18—the first day of the Republican National Convention (RNC) in Cleveland—the party formally adopted its 2016 platform, including several proposals impacting federal housing policy. You can read the full platform here.

The Republican platform criticizes President Obama’s response to the financial crisis for overlooking what they argue was the true cause—federal housing policies. Therefore, in order to restore economic growth and strengthen the housing market, the platform calls for scaling back the federal government’s role in the housing market, reforming anti-poverty programs, limiting fair housing and fair lending regulations, and abolishing the Consumer Financial Protection Bureau (CFPB).

Housing Finance Reform

The Republican platform calls directly on the federal government to scale back its involvement in the housing finance system, including Fannie Mae, Freddie Mac, and the Federal Housing Administration (FHA).

The platform suggests that the next Administration should “reconsider the utility” of the government-sponsored entities (GSEs), alleging that their current business model is corrupt because taxpayers are liable for any losses, while shareholders and executives benefit from any profits. The platform also calls for reforming the FHA so that it no longer guarantees mortgages for higher-income households.

In criticizing the agencies’ affordable housing goals, the platform states that Republican party “will end the government mandates that required Fannie Mae, Freddie Mac, and federally insured banks to satisfy lending quotas to specific groups,” and suggests that affordable housing goals amount to discrimination.

Anti-Poverty Measures

Like the House Republican’s anti-poverty plan that was released in June, the party platform focuses on what Republican see as the failures of the War on Poverty. Both proposals claim that instead of lifting families out of poverty, federal programs actually keep families dependent on the government. At the heart of both proposals is the idea that the War on Poverty has failed and wasted billions of dollars in the process.

Moreover, both proposals uphold 1994’s welfare reform legislation as a model for federal assistance going forward. By emphasizing the need for “the dynamic compassion of work requirements,” the platform argues that opportunity can replace handouts.

Fair Housing and Fair Lending

The platform criticizes federal fair housing and fair lending laws. It argues that HUD’s Affirmatively Furthering Fair Housing (AFFH) regulations amount to “social engineering,” and has “nothing to do with proven or alleged discrimination and everything to do with hostility to the self-government of citizens.”

Moreover, the Republican platform plainly states that the party will “end the government’s use of disparate impact theory in enforcing anti-discrimination laws with regard to lending,” without providing further explanation.

Consumer Financial Protection Bureau (CFPB)

The Republican platform calls for the CFPB to be abolished. If Republicans are unable to eliminate the agency, the platform calls for the CFPB to be funded through the Congressional appropriations process; the agency’s funding was designed to be insulated from politics and is currently funded directly from the Federal Reserve.

Moreover, the platform criticizes the agency’s role in directing CFPB settlement funds to third-party organizations; instead, it argues that outside of making consumers whole, settlement funds should go directly to the Treasury Department and diverting settlement funds to third-parties should be a criminal offense.

Next Steps

In the coming months, we will learn more about how Republican presidential candidate Donald Trump and House and Senate candidates plan to use this platform in their campaigns.

Next week, Democrats will vote on their party platform at the Democratic National Convention in Philadelphia.

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