KOA's Morning News failed to identify right-wing think tank in interview with critic of foreclosure aid plan

Summary: During a February 13 interview with guest Nicole Gelinas, who criticized a Bush administration plan to aid homeowners forcing foreclosure, co-host Steffan Tubbs of Colorado's Morning News on Newsradio 850 KOA introduced Gelinas as a "senior fellow" with the Manhattan Institute for Policy Research, but did not identify the think tank's conservative agenda.

Discussing President Bush's foreclosure aid proposal on the February 13 broadcast of Newsradio 850 KOA's Colorado's Morning News, co-host Steffan Tubbs twice said his guest, Nicole Gelinas, was "with the Manhattan Institute" and "a senior fellow there," but did not indicate that the Manhattan Institute for Policy Research is a conservative think tank, as Colorado Media Matters has pointed out.

According to a February 13 Washington Post article, "[t]he Bush administration and six large mortgage lenders unveiled a plan yesterday to offer some homeowners facing foreclosure 30-day reprieves to work out alternatives." The article continued:

The program, which will target homeowners who are 90 or more days late on payments, is the industry's latest attempt to untangle the mess caused by years of lax mortgage standards.

These homeowners will receive a letter offering a "pause" in the foreclosure process to try to work out a repayment schedule.

Delinquent borrowers have always had the option of calling their lender for help in advance of a foreclosure. But the foreclosure process typically continued during those talks. Under this plan, there would be a 30-day freeze in the process.

[...]

Modifications to loans would be made on a case-by-case basis, and not all eligible loans are expected to be salvageable, industry officials said.

Homeowners in bankruptcy protection will not be eligible for the program, which also excludes vacant and investment properties. The offer also will not apply to borrowers whose homes are scheduled for a foreclosure sale within 30 days.

Gelinas asserted that the homeowner assistance program is "not really voluntary" because "while the government says that this is voluntary, the banks know the government has a lot of other tools to use against them if they don't cooperate in this." She added, "And anything that looks like government interference in the private markets is just going to raise interest rates down the road for everybody, not just people who got in trouble in this manner."

Concluding the interview, Tubbs again identified Gelinas as a "senior fellow" with "the Manhattan Institute," but still did not note the think tank's conservative agenda.

According to MediaTransparency.org, the Manhattan Institute was funded by the John M. Olin Foundation, a donor to "right-wing think tanks" before ceasing its philanthropic efforts in November 2005. According to the Manhattan Institute's website, the think tank has "supported and publicized research on our era's most challenging public policy issues: taxes, welfare, crime, the legal system, urban life, race, education, and many other topics. We have won new respect for market-oriented policies and helped make reform a reality." The organization states that that its mission is "to develop and disseminate new ideas that foster greater economic choice and individual responsibility."

Referring to the think tank's founder, Antony Fisher, a February 22, 1998, Boston Globe article described the Manhattan Institute as "a conservative think tank that was founded by Margaret Thatcher's mentor and Ronald Reagan's spymaster." The article further stated:

The Manhattan Institute was a speck on the margins of the city's [New York's] political landscape when it opened in 1978, promoting the un-New Yorkerish notions of free-market economics, conservative values and the dismantling of the welfare state.

Now, 20 years later, it dominates political discussions and helps set the agenda. Like the city's Republican mayor, Rudolph Giuliani, the institute rose on the crushed hopes of the 1980s, when rising crime, spiraling taxes, deep recession, and sprawling disorder -- all unfolding under a City Hall that seemed to many a caricature of Democratic liberalism -- sparked a backlash.

From the February 13 broadcast of Newsradio 850 KOA's Colorado's Morning News:

TUBBS: Nicole Gelinas joins us. She's with the Manhattan Institute and a senior fellow there. And talking about President Bush's proposals, and Nicole, it's good to have you on in Denver. Appreciate the time.

GELINAS: Good morning, Steffan. Good to be here.

TUBBS: I guess, first and foremost, we've heard a lot -- and I don't know if you're hearing this nationwide -- but at least here in Colorado, as our series continues on Colorado foreclosures specifically, that people are emailing us sayin', "Look, it's not the government's job to make deals with mortgage companies or banks to bail out people that may have A) been uneducated, and B) got into something they knew going into they shouldn't be into," if you know what I mean. Are you hearing similar things, or is that just here?

GELINAS: No, no, we're hearing that as well, and I think that's correct. Unfortunately, while the government says that this is voluntary, the banks know the government has a lot of other tools to use against them if they don't cooperate in this. So it's not really voluntary. And anything that looks like government interference in the private markets is just going to raise interest rates down the road for everybody, not just people who got in trouble in this manner.

TUBBS: As you know, President Bush is going to sign off on this economic stimulus package, and so forth. Can you put it in layman's terms what exactly the government's role plans to be in the coming -- besides these tax rebates and all of that -- what the government's plan for its own role in talking with these banks and trying to get people this extra 30 days, and that kind of thing?

GELINAS: Right. In terms of the mortgage stimulus, what they're doing is encouraging the banks -- you know, voluntarily, supposedly -- to go back to borrowers and say, "If you are behind your mortgage for a few months, for example, we'll put that balance of the mortgage on top of your existing mortgage so you're not behind anymore, you just owe more money." In some cases they'll lower the interest rate so that people's monthly payments are lower. And, in some cases, they'll cut the total balance of the mortgage. Now, some of these things are fine if it was really voluntary. If the bank and the lender want to work out a very bad deal that both of those parties signed, that is within their rights to do so, just as if I owe you, if I lend you $100, you can't pay me back, I say, "Fine, you can pay me back $80." That's fine, but what's not fine is that in some cases these negotiations under pressure from the government are just going to delay problems that are inevitable, and that we'd be better off taking the pain now so that we can recover. If a person bought a house that the person cannot afford -- if you're making, you know, $40-$50,000 and you've bought a $500,000 house -- there's no way that you can afford that house. It may be painful for you to move, but that's what you have to do.

TUBBS: Right.

GELINAS: And this just creates a additional problem.

TUBBS: Right. In the 30 seconds we have left, just the way you're watching this whole thing shape out, and a lot of us added the word "subprime" to our vocabularies in 2007 -- from your perspective, can you kind of believe the numbers you're seeing and the amount of foreclosures, and that kind of thing?

GELINAS: I think if we look back and see the crazy things people were doing up until maybe a year and a half ago -- allowing people to borrow more than the amount of the house, no money down, teaser interest rates -- then we definitely can believe these numbers. Unfortunately, there will probably be a couple of million foreclosures in the nation. And, of course, housing prices will continue to fall, which hurts people's ability to take equity out of their homes, do more consumer spending. So we are in for a rough economic time. But that doesn't mean economic disaster, and this is just a normal, cyclical, inevitable thing.

TUBBS: Nicole, great to have you on. Thanks for the time this morning.

GELINAS: Thank you.

TUBBS: Appreciate it. Nicole Gelinas with the Manhattan Institute. She's a senior fellow there. Talking about, among other things, "Project Lifeline," proposed by President Bush. It's gonna be available to people who have taken out all kinds of mortgages, and involves at least six of the country's largest financial institutions.

—C.H.