Monday, December 28, 2009


There are many "ah-ha moments" in author P. Michael Saint’s "Nimby Wars." Whether you are a developer trying to push a controversial project through the permitting and construction process, or neighbors trying to stop it, "Nimby Wars" provides invaluable insights and strategies. And for the regulators caught in the middle, the book is a "must read" that takes some of the mystery out of what seems to be the "surprise attacks."

For more than three decades, I headed government planning agencies in California. I can recognize many of the controversies and scenarios the authors included in "Nimby Wars." It is a good, entertaining read. It also can serve as a "manual" for what is likely to occur as proponents and opponents bash each other with the environmental laws that "govern" most states', counties' and cities' land-use decisions.

This review of “Nimby Wars” was written for by John Hardisty of Bakersfield. To read more about this book, go to


Victor E. Brooks' "Boomers: The Cold-War Generation Grows Up" is a quick, but compelling read. With less than 200 pages, it is packed with historical, demographic and cultural insights about the "largest generation," if not "The Greatest."

Returning World War II veterans set about creating families - in many cases large families - and embarked on an unprecedented path for America. In the 18 years that followed the end of World War II, about 77 million babies were born. While some feared the war's end would return the United States and the world to the Great Depression days, the opposite occurred. Boomers and their parents created enormous wealth and prosperity.

Brooks, a professor of historical foundations at Pennsylvania's Villanova University, details the cultural, economic, political, religious and geographic factors that shaped Boomers' lives and attitudes. For Boomers, the book is a walk down "memory lane." For everyone, the book is a "must read" to prepare for the tsunami of Boomers headed into retirement. It gives insights into the challenges and potentials that loom ahead for those providing services to aging Boomers and for companies hoping to capitalize on the generation's enormous and continuing spending potential.

Boomers - people born between 1946 and 1964 - are about 77 million strong. The generation often has been described as the "pig in the python" -- the big lump that moves along the demographic line. The "lump" once filled the nation's schools, later swelled the labor force and then super-heated the consumer economy. The first Boomer will turn 65 in 2011. Already someone in the United States is turning 65 years old every seven seconds. Social Security is reeling from the leading edge of this Boomer wave.

Boomers are expected to be the healthiest, most active, affluent and long-living group of retirees. Are we prepared to meet their demands and needs? Brooks' book helps us prepare.

This review was written by John Hardisty of Bakersfield for To read more about this book, go to


Rabbi Harold S. Kushner's "When Bad Things Happen to Good People" is both insightful and comforting. It cuts across religious lines to help people understand and respond to personal setbacks. You can wish for setbacks not to have occurred. You can even anguish over their occurrence. But you cannot ask God to wipe away these setbacks. You can only move forward. You only have "control" over your forward movement, not your past. The resources God gives us - friends, family, medical staff, legal staff, etc. - are God's gift in these circumstances. Rabbi Kushner relates this message through his family's setback - the birth and within a relatively short time the death of a son who is born with a rare, debilitating disease. The book version of "When Bad Things Happen to Good People" is well worth buying and reading. The abridged CD version loads nicely on devices, such as iPods. All or portions of the abridged version can be listened to in an hour or less. Each listening session brings a portion of Rabbi Kushner's message into greater focus. This review was written by John Hardisty of Bakersfield for To learn more about this book, go to

Sunday, December 27, 2009


When Bill Thomas was chairman of the tax-writing House Ways and Means Committee, he thought too much emphasis was being placed on home ownership.

“If you can afford to buy a house, you are rewarded handsomely in a number of financial ways. If you can’t, you are punished because you pay rent. You can’t even subtract rent from your income tax,” said Thomas, who retired in 2006, after representing Bakersfield in Congress for 28 years.

So the concept that became the “American Dream” was that everyone should own a home, which will be a source of equity, an asset. Then these homeowners can borrow against their homes.

“And as we have seen, people have been put into homes that they couldn’t afford in the beginning and which they certainly could not afford once balloon payments kicked in,” Thomas said during a recent interview with The Californian. “There was a lot of money to be made on these subprime loans. Very clever people found ways to reinsure and monetize mortgages that probably had no value.”

Thomas has been appointed vice chairman of the Fiscal Crisis Inquiry Commission, which was created by Congress and President Obama to explain how “clever people,” such as Wall Street bankers and their real estate cohorts on Main Street, created worthless financial instruments that have rocked the nation’s economy nearly off its foundations.

While the consequences of the subprime mortgage industry are far-reaching and painful, the misplaced rewarding of debt is not confined to the real estate industry. Thomas noted the “debt versus equity” imbalance goes all the way back to the Enron scandal.

“It was cheaper to carry equity than debt. And you could hide debt with creative instruments that the regulators didn’t fully understand, in my opinion, and didn’t see until it was too late,” he said. “Enron was a prime example.

“If we had changed the tax code to be neutral on renting or owning, we would not have had the problems of subprime mortgages and all the rest. People could rent and feel good about it and have a deduction on their income taxes.

“We banned in the early 80s the deduction of personal interest credit on your income tax, but we did not build a fire wall between the debt in owning a home through mortgage and your ability to pull equity out of the home to spend the money on the RV you couldn’t get a tax deduction for,” he said. “We even had instruments that gave you a check each month for the increased equity, so they made sure you had no equity.”

There was the belief that the market value of property would go up every year. But if it went down, instead, and an owner had been pulling equity out of his home, he quickly found himself “upside down” – owing more than the home was worth.

“And there were cases around here, where Realtors and appraisers were not willing to wait for the quarter, or the year or two years to see the appreciation that always came,” said Thomas. “They began jiggering it around and flipping it in what amounted to illegal appraisal activity to drive the price up.

“The newspaper ran stories about people not following rules, ethical standards and laws. I am not talking about banks. I am talking about real estate people,” said Thomas. “A piece of property was worth $1 million and a few months later it was worth $1.4 million. Why? Because they paid the appraiser to reappraise the place, just like Wall Street paid for the Moody’s triple-A rating” on combined mortgages.

“Banks were not used to loaning money to people who didn’t have a job and could not meet the monthly payments. You could write a mortgage to someone who occupied the house, but they never made the first payment. That’s called a subprime mortgage and they were being written all over the place.

“Then you could combine them, get a certification, get a reinsurance policy and send it out [to investors]. When it started unraveling, the principle reinsurance agency was AIG,” said Thomas, noting Moody’s triple-A ratings on these combined mortgages were paid for in the same way some were paying for inflated real estate appraisals.

“You haven’t seen any real focus on the rating agencies in this first wave of reform coming through Congress. That has to be done,” said Thomas, noting that the role of rating agencies, such as Moody’s, in the ongoing financial scandal will be investigated by his commission.

“Look at these combined mortgages that carried a triple-A rating,” said Thomas. “AIG wrote a reinsurance deal on them, notwithstanding the fact that all the reinsurance that had been written was worth X times what AIG had in cash.

“AIG never thought it would have to pay off for those because they had triple-A ratings. So all of a sudden, you are sitting there with this thing and it isn’t triple-A. Some of it may be good, but some of it was obviously bad and nobody knew what it was worth. And it’s not buildings. It is artificially combined mortgages.

“So it isn’t easy to unravel. And we are still in the middle of that.”

[What would you tell Bill Thomas to investigate when his Financial Crisis Inquiry Commission kicks into "high gear" next month? Send your comments directly to John Hardisty at, or post them on this blog.]

A version of this article written by Dianne Hardisty first appeared in The Bakersfield Californian on Dec. 27, 2009.


Former Republican Congressman Bill Thomas now is vice chairman of the Financial Crisis Inquiry Commission, which was created by Congress and the president to identify the causes of the ongoing U.S. financial meltdown. In an interview published Dec. 27, 2009 in The Bakersfield Californian, Thomas contended that Wall Street and Main Street teamed up to create the mess the U.S. is in by paying for inflated property appraisals and Triple-A securities ratings to create packages of subprime mortgages and pawn them off to investors. This mess isn’t done unraveling. Read more of what Thomas had to say at

Friday, December 18, 2009


Recently I wrote an opinion article -- “As Foreclosure Crisis Keeps Growing, Lenders, Borrowers Need Mediation,” that appeared in the Dec. 8 Bakersfield Californian. It also is posted on this blog.

It recounted the plight of a homeowner, who appeared in court with documents showing he was negotiating with his lender for a loan modification, while at the same time the lender was evicting him. He could not understand how the lender could be working with him and against him at the same time.

A McClatchy newspaper story today explains how this can happen.

In the fine print of the form homeowners fill out to apply for the Obama administration’s Home Affordable Modification Program, which lowers monthly payments for three months while the lender decides whether to provide permanent relief, borrowers waive notification rights. This allows lenders to reject borrowers from permanent modification without written notice and auction off homes without warning, according to the newspaper.

Wednesday, December 9, 2009


Confusion and frustration were etched across the face of the man as he awaited his appearance before a Kern County Superior Court judge. In one hand he held letters from his bank documenting ongoing negotiations to restructure his home loan. In the other hand, he held papers documenting the bank's efforts to evict his family.

How could the same bank seem to be working with him and against him at the same time? Simple -- refinancing and foreclosing, followed by eviction, were being handled by two different units of the same bank.

By the time the man ended up in court, there was little left to discuss. The judge confirmed that the bank could take possession of the Bakersfield house the man had built himself, for his own family.

The Recorder's Office reports that there were 6,530 foreclosures this year in Kern County as of October. Some cash-strapped homeowners simply move out. But many are being hauled before local judges as part of an eviction process.

As the nation, state and county struggle with the worst recession since the Great Depression and the jobless rate climbs, economists predict more Americans will be unable to make their mortgage payments. Foreclosures, evictions and blighted neighborhoods will result.

The Mortgage Bankers Association reports 14 percent of homeowners with mortgages were either behind on payments or in foreclosure at the end of September. The Congressional Oversight Panel, which monitors the Treasury Department's bailout program, concludes foreclosures now threaten families who bought within their means to pay, and who took out conventional, fixed-rate loans, with down payments of 10 percent to 20 percent.

The Obama administration's Making Home Affordable program was supposed to bring relief by giving lenders incentives to work with borrowers to "modify" their mortgages, lower payments and stem foreclosures.

This $75 billion foreclosure-prevention plan is not working as expected. While more than 650,000 borrowers have been given "trial mortgage modifications" under the plan, relatively few have received permanent modifications. To receive a permanent modification, borrowers must make three payments during the trial period and provide proof of hardship.

Borrowers complain they have been denied permanent modifications even after making trial payments and producing the necessary paperwork. The prolonged, unsuccessful process has put some homeowners into deeper financial holes.

Acknowledging the program's disappointing results, Treasury officials recently increased pressure on lenders to help troubled borrowers. Instead of paying lenders $1,000 up front just to begin the loan modification process, lenders now will be given the cash incentive only if the modifications are finalized. Treasury officials also will identify lenders that balk at permanently modifying loans.

California Assemblyman Pedro Nava and Assembly Speaker Karen Bass are asking the Legislature to take an additional step. They want California to join more than a dozen other states that require borrowers and lenders to enter into mediation before property is foreclosed.

During a recent hearing on California's foreclosure crisis, Nevada Assembly speaker Barbara Buckley testified that the No. 1 complaint in her state from homeowners is their inability to reach someone at their bank to talk to. Since Nevada implemented a mediation program in July, 3,400 homeowners have requested mediation.

The proposal to begin a mediation program in California, AB 1588, will be considered when the Legislature reconvenes in January. Who operates the program, who conducts the mediations and who pays for the program are questions that need to be resolved.

But with California having the third-highest foreclosure rate in the nation, clearly more must be done to bring lenders and borrowers together, to keep more people in their homes, and to keep the foreclosure crisis from devastating communities.

"Voluntary approaches that rely on the beneficent decisions of lenders are no longer acceptable," Nava wrote in a recent opinion article, explaining the need for mediation. "All of the programs that exist today fail to create an atmosphere of accountability, trust and transparency in the loan modification process."

This article by John Hardisty (Jack) first appeared in The Bakersfield Californian's Opinion Section on Dec. 9, 2009.

Wednesday, November 25, 2009


California’s Democratic Congressman Jim Costa of Fresno is an unabashed booster of trains. As a state assemblyman and later state senator, he pushed doggedly on expansion of Amtrak service through Central California. He lobbied for the upgrading of Amtrak stations and construction of new ones. He regularly rode Amtrak from his Fresno home to Sacramento, the state’s capital.

So it’s no surprise that he is wearing a smile from ear to ear these days as California has joined several other states in applying for federal stimulus money to build a high-speed rail system.

California is seeking more than half of the $8 billion that Congress and President Barack Obama set aside for high-speed and intercity rail projects across the country.

Costa addressed a Fresno audience of San Joaquin Valley regional planners on Oct. 2, the same day Gov. Arnold Schwarzenegger submitted California’s $4.7 billion application for high-speed rail funding. Costa believes California’s chances are darn good.

Give Costa a lot of the credit for that. His sheer tenacity helped convince California voters to approve a $10 billion bond on the November 2008 ballot to continue design and planning for a high-speed rail system. This was after naysayers said the measure was doomed by the slumping economy and the “Buck Rogers” image of the project.

But voters did approve the bond, validating Costa’s belief that the state is long overdue for investment in its infrastructure.

To regional planners, who focus much of their energies on improving California’s transportation systems, Costa likened building a high-speed rail system to the 1950s and 1960s, when Californians created the nation’s premiere education system, a massive state water project and a futuristic freeway system.

Costa’s comparisons did not end there. He noted Republican President Dwight D. Eisenhower built the massive federal highway system during troubled economic times. And Republican President Abraham Lincoln pushed through a transcontinental railroad line when the nation was divided by war, inflation was raging and the first printing of paper money was underway.

For those tempted to say these times are not the right times to invest billions of dollars in a high-speed rail system, Costa counters with historian Stephen Ambrose’s “Nothing Like It in the World,” an account of how the transcontinental railroad came into being despite overwhelming odds.

High-speed rail “is a tremendous opportunity for California and the nation,” said Costa, who contends California’s application is strengthened by voters already approving matching funds for the project and by the planning that has already been completed. California is a lot closer to breaking ground than other proposals.

Costa said applications can be expected to be submitted for stimulus funds to help pay for high-speed rail projects in 11 of the nation’s transportation corridors. In addition to California, projects in the Midwest and in the Eastern corridor will be the most competitive, he said.

But there’s no doubt about it in Costa’s mind. Californians “will get to ride on high-speed rail.”


“Hell no, we won’t go” was a protesters’ chant commonly heard decades ago during the Vietnam War. That protesting generation of baby boomers now seems to be taking the same chant into its aging years.

Joan Twiss, founder and executive director of the Center for Civic Partnerships, made that observation during a recent meeting of the California Chapter of American Planning Association.

She put it more politely – changing “hell” to “heck” – but she was clear: Boomers aren’t going peacefully into their twilight years.

Many are in denial about getting old. Consider the plethora of anti-aging creams, vitamins and beauty aids on the market.

They insist on remaining active – working, volunteering and playing hard. “Boomeritis” is a general term now being used to describe a wide range of physical maladies – from torn rotator cuffs to busted knees – that aging boomers experience as they cling to their old sports teams.

For the most part, they are sticking around. They aren’t moving from the communities where they have sprouted deep roots. They intend to “age in place.”

And many are discovering that they may not be able to afford to get old. They have not saved up enough money, or their retirement funds and their jobs have been wiped away by the most dire economic conditions to beset the nation since the Great Depression.

An estimated 15.5 percent of the people living in California who are 55 years of age or older are eligible for Medi-Cal, planners were told. The gap between the haves and the have-nots will increase, with some estimating that 55 percent of the population may be too poor to pay for the basic services needed to survive their final years.

Baby boomers – people born between 1946 and 1964 – are about 77 million strong. The generation often has been described as the “pig in the python” -- the big lump that moves along the demographic line. The “lump” that once filled up the nation’s schools, later swelled the labor force and super-heated the consumer economy, is now headed to retirement.

The first baby boomer will turn 65 in 2011. Already someone in the United States is turning 65 years old every seven seconds. The wave of baby boomers hitting the shore will be a Social Security tsunami.

Over the next decade, Kern County’s 60-plus population is expected to increase by 65 percent, according to the U.S. Census Bureau and the American Community Survey. In 2006, when the survey information was collected, the number of people 60 years of age and older was 93,585, or 12 percent of Kern County’s population.

Baby boomers are expected to be the healthiest, most active, affluent and long-living group of retirees Kern County and the nation has seen.

Are communities prepared to meet their demands and needs?

Paul Zykofsky, director of land use and transportation programs at the Local Government Commission and the manager of the commission’s Center for Livable Communities, told California planners at their recent state conference that few communities are ready for the silver tsunami.

He said baby boomers will be looking for communities that are safe, welcoming, convenient, comfortable, containing good and safe housing, and are “walkable,” meaning residents can walk from their homes to stores, offices, job sites, entertainment, etc. As people age, they are more interested in living in town houses and in downtown areas.

But in most communities, residential development has spread into the outskirts of towns, requiring people to drive their cars to get to just about any location. Public transportation and access to services, including health services,
often fall short in spread-out communities, especially those in the San Joaquin Valley.

Aging of baby boomers may be the biggest challenge, as a society, that we face. Adequate housing, mobility, employment, lifelong learning, community involvement and support services are critical to creating a healthy community.

The wave of baby boomers is headed our way. We need to begin preparing now, before it is “sink or swim” time.

This article written by JOHN HARDISTY (Jack) appeared first in The Bakersfield Californian.