Last weekend, while enormous numbers of Americans were marching throughout the country against the proposed policies of a president sworn in just the day before, the Trump administration had already made a move that will make it more expensive for many Americans to become homeowners. The rescinding of a pending cut in mortgage insurance rates planned to go into effect January 27 wasn’t a big surprise, and it doesn’t seem to have been a carefully considered policy decision. The Obama administration implemented the planned cut in its final days, apparently without consulting the incoming Trump team. But none of that changes the fact that for all President Trump’s talk about helping the little guy, this move will hurt low- and middle-income borrowers.
Though predictable, this policy reversal was neither urgent nor necessary — Trump still hasn’t even named a commissioner to head the FHA, the person who would have overseen the implementation of the fee cut. Dr. Ben Carson, who Trump has tapped to head the Department of Housing and Urban Development (which oversees the FHA), was asked about it during his confirmation hearings, and while he promised to “really examine that policy,” he expressed frustration with the timing of the cut, which would have saved the average homeowner $500 per year, and $1,500 in parts of California. An FHA surplus that had grown by an estimated $44 billion over the past four years would have more than made up any difference. Besides that, FHA’s capital reserve ratio had exceeded requirements for the past two years, which was why the Obama administration decided to share those gains with taxpayers.
But because the Trump administration took this unnecessary action to suspend the rate cut, upward of 850,000 first-time buyers, Americans in the working- and middle-class for whom the new president has claimed to be a champion, will be paying more.
Trump, the real estate mogul, knows very well that every extra dollar a first-time homebuyer is forced to spend can be the difference between being able to buy a house or being shut out of the market. That this knowledge seems to matter little to the incoming administration, though, should not come as a surprise. After all, he chose Carson, a man who has described government programs designed to help the needy as “dependency” creators, to lead maybe the most important governmental department designed to help the poor and the middle-class.
Trump’s persona as champion of the everyday American has long been a head fake, given his business track record that includes being sued for racial discrimination, fraud and for not paying the small business owners who have done work for him. This move, coming so early in his tenure, simply underscores what we’ve long known about his priorities — they don’t include the everyday Americans struggling to make ends meet.
That’s why the pleas to “just give him a chance” or “wait to see what he does” have always been absurd. The decisions Trump has made from the day he began running for president have proven that he is rhetorically in tune with what many Americans want to hear, which is often the opposite of what they need. In addition to his mortgage insurance decision, Trump took first-day steps to begin the gutting of the Affordable Care Act, which has improved and saved the lives of millions of everyday Americans. He has also staffed a Justice Department that likely won’t protect voting rights as aggressively as the Obama administration, and espoused a tax policy that could be heavily weighted toward providing relief for the richest among us.
It’s clear Trump isn’t waiting to see what his opponents plan to do before acting. There’s little reason to believe he wouldn’t implement policies that hurt, rather than help, the very communities he pledged to help during his campaign. That’s why elections matter. But that’s also why what happened on Saturday, with coordinated marches throughout the country in a way we haven’t seen in a long time, must be a beginning, not an end. Trump’s actions, if not his words, prove that he isn’t a champion of the everyday American — which means everyday Americans better be ready to champion themselves.