Last May, the Wall Street Journal ran a front-page story about AngryRenter.com, a website which served as a rallying point for disgruntled souls opposed to a prospective Bush administration foreclosure bailout. AngryRenter.com had collected 44,500 signatures for a petition, but Journal reporter Michael Phillips discovered--by clicking on the site's "About Us" link--that it wasn't actually a people-powered uprising. Instead, AngryRenter was the product of FreedomWorks, a group run by Dick Armey and Steve Forbes.
Phillips spent several paragraphs detailing all the deluxe homes owned by Armey, Forbes, and others associated with FreedomWorks, making the point that only wealthy, cynical Republicans would object to helping those unfortunates caught in the maw of foreclosure.
But that was a long time ago. Before Lehman Brothers. Before TARP. Before the Detroit bailout and Obama's trillion dollar stimulus package. Now the new administration has put forward its Homeowner Affordability and Stability Plan, a $275 billion scheme to save certain people from foreclosure, and a real opposition movement may be building.
With almost $2 trillion in emergency government spending doled out since October, Obama's Home Affordability measure can be considered small beer. And at the end of the day, it's as much about creating a backdoor bailout for the banks who hold the mortgages as it is about "saving" people's homes. But as a political matter, it's something else.
On the morning of February 19, CNBC reporter Rick Santelli ranted about the plan from the floor of the Chicago Board of Trade. "This is America!" Santelli cried on the air. "How many of you people want to pay for your neighbor's mortgage that has an extra bathroom and can't pay their bills?" The traders milling around started booing and then gathered closer as he continued. Before he was done, Santelli had called for a "Chicago tea party" to protest the bailout. During the next few hours, Santelli's rant led the Drudge Report, was replayed on all of the cable networks, and was seen more than a million times on YouTube.
Santelli-inspired websites quickly appeared attempting to organize tea parties. ChicagoTeaParty.com bills itself as the official home of Santelli's tea party. The site belongs to Zack Christenson, a Chicago radio producer. Christenson had bought the domain last August, thinking it might be a good name for a group. Within 12 hours of Santelli's rant, Christenson had retooled the site, and 4,000 people quickly signed up. On Facebook, dozens of Santelli groups formed, ranging from fan clubs to draft-president movements to tea party plans for Chicago, Texas, New York, and Los Angeles.
Anthony Astolfi bought the domain reTeaParty.com about 10 hours after Santelli's rant. Astolfi is a 24-year-old web designer and small-time political consultant who dabbled in the Ron Paul world last cycle. He thought the tea party idea had a chance to catch on and decided to organize them for July 4. Working with his roommate and a cousin, they finished building a website by midnight. Then they turned to promoting the project. They did Google searches for "Santelli" and left comments pointing to their new site on high-ranking result pages. They spent a couple hundred dollars on a small number of Google and YouTube ads and finally went to bed around 5 A.M. They awoke to 40,000 emails, their site having become a minor sensation. Astolfi says they now have 11,000 people a day coming to reTeaParty.com. Ten thousand people have signed up to get information on the tea parties, and 5,000 have "pledged" to attend one of so-far eight tea parties on July 4.
Two days after Santelli's tirade, John Shilling, an 18-year-old student in Hilton Head, South Carolina, launched a site called 92percentgroup.org. Its sole mission is to oppose the Homeowner Affordability and Stability Plan. "We feel like 92 percent of the country has been paying their mortgage on time, and we've been a silent majority this whole time," Shilling says. "We're hoping to get enough people together to take a stand so we can send a message through action, not a petition." What action would that be? Shilling isn't sure, though he thinks withholding taxes or mortgage payments might work. In a way, the 92 Percent Group is instructive: It's run by an 18-year-old who doesn't have a mortgage and has yet to even decide what he wants to organize (or how to do it). Yet within 72 hours of launching the site, it received 150,000 visits.
There seems to be real bitterness about the idea of forcing people to subsidize the imprudent housing choices of their neighbors. That bitterness is on display on other websites, such as StopTheHousingBailout.com, which urges readers not to get stuck "paying for other people's greed & ignorance" and encourages them to lobby their congressmen.
Much of the opposition to the bailout, however, comes from people who are only tangentially interested in the politics of the matter. Beginning in 2005, hundreds of websites and blogs sprouted up warning about the housing bubble. At the time, these people were often viewed as doomsayers or cranks. Thoroughly vindicated, many of their sites are now de facto rallying points against Obama's plan, purely on grounds of economic prudence.
The blog FlippersInTrouble, for instance, gives exhaustive data on the losses being racked up by speculators in Sacramento, which won't help build sympathy for the beneficiaries of the bailout. HousingDoom.com, a site which began by looking at economic aspects of the bubble in 2006, is now saying, "What the market needs is more foreclosures." There is no obvious political pattern to the bubble bloggers. Some are freemarketeers. Others, such as those who run HousingPanic.com, are Democrats who see the bubble as one more failure of the Bush administration. Yet nearly all of the bubble sites, left, right, and center, are now lined up against the bailout.
But will they create a movement? Last weekend readers of TheHousingBubbleBlog.com went offline and met in Las Vegas for a get-together. There were only 24 of them, but they came from as far as New York and Washington for the chance to vent about the housing market, talk about the bailout plan, and take a bus tour of foreclosed properties and derelict construction sites. Ben Jones runs the site and put together the mini-convention. A few months ago, he says, he was asked to start a PAC to help organize a movement against the bailout. He declined because he believes the administration will do whatever it pleases, regardless of public pressure. "Whether or not there will be organized opposition, I can't say," Jones sighs. "But if there is, it won't make a difference."
He's probably right. Yet at the same time, it's easy to see the groups that might make up a real grassroots movement: the Ron Paul libertarians, renters, housing bubble obsessives, disillusioned Democrats, stat-head financial types, and, of course, rich, heartless Republicans. And then there is Santelli, who, if so inclined, might put himself forward the way Howard Jarvis did with his property tax revolt in California in 1978.
The question is whether or not these people can find each other and figure out a way to push back.
By Jonathan V. Last
Reprinted with permission from The Weekly Standard