Tag Archives: doctor

Dr. Carson’s Slim Housing Credentials

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photo by Gage Skidmore

Law360 quoted me in Carson’s Slim Housing Credentials To Be Confirmation Focus (behind paywall). It opens,

Dr. Ben Carson will face a barrage of questions Thursday on topics ranging from his views on anti-discrimination enforcement to the basics of running a government agency with a multibillion-dollar budget at his confirmation hearing to lead the U.S. Department of Housing and Urban Development.

Carson, a famed neurosurgeon and former Republican presidential candidate, was President-elect Donald Trump’s surprise choice for HUD secretary, given the nominee’s lack of experience or statements on housing issues. That lack of a track record means that senators and housing policy advocates will have no shortage of areas to probe when Carson appears before the Senate Banking Committee.

“I want to know whether he has any firm ideas at all about housing and urban policy. Is he a quick study?” said David Reiss, a professor at Brooklyn Law School.

Trump tapped Carson in early December to lead HUD, saying that his former rival for the Republican presidential nomination shared in his vision of “revitalizing” inner cities and the families that live in them.

“Ben shares my optimism about the future of our country and is part of ensuring that this is a presidency representing all Americans. He is a tough competitor and never gives up,” Trump said in a statement released through his transition team.

Carson said he was honored to get the nod from the president-elect.

“I feel that I can make a significant contribution particularly by strengthening communities that are most in need. We have much work to do in enhancing every aspect of our nation and ensuring that our nation’s housing needs are met,” he said in the transition team’s statement.

The nomination came as a bit of a surprise given that Carson, who has decades of experience in medicine, has none in housing policy. It also came soon after a spokesman for Carson said that he had no interest in a Cabinet position because of a lack of qualifications.

Now lawmakers, particularly Democrats, will likely spend much of Thursday’s confirmation hearing attempting to suss out just what the HUD nominee thinks about the management of the Federal Housing Administration, which provides insurance on mortgages to low-income and first-time home buyers; the management and funding for public housing in the U.S.; and even the basics of how he will manage an agency that had an approximately $49 billion budget and employs some 8,300 people.

“You will have to overcome your lack of experience managing an organization this large to ensure that you do not waste taxpayer dollars and reduce assistance for families who desperately need it,” Sen. Elizabeth Warren, D-Mass., said in a letter to Carson earlier in the week.

To that end, Carson could help allay fears about management and experience by revealing who will be working under him, said Rick Lazio, a partner at Jones Walker LLP and a former four-term Republican congressman from New York.

“The question is will the senior staff have a diverse experience that includes management and housing policy,” Lazio said.

One area where Carson is likely to face tough questioning from Democrats is anti-discrimination and fair housing.

Carson’s only major public pronouncement on housing policy was a 2015 denunciation of the Affirmatively Furthering Fair Housing rule that the Obama administration finalized after it languished for years.

The rule, which was part of the 1968 Fair Housing Act but had been languishing for decades, requires each municipality that receives federal funding to assess their housing policies to determine whether they sufficiently encourage diversity in their communities.

In a Washington Times, op-ed, Carson compared the rule to failed efforts to integrate schools through busing and at other times called the rule akin to communism.

“These government-engineered attempts to legislate racial equality create consequences that often make matters worse. There are reasonable ways to use housing policy to enhance the opportunities available to lower-income citizens, but based on the history of failed socialist experiments in this country, entrusting the government to get it right can prove downright dangerous,” Carson wrote.

Warren has already indicated that she wants more answers about Carson’s view of the rule and has asked whether Carson plans to pursue disparate impact claims against lenders and other housing market participants, as is the current policy at HUD and the U.S. Department of Justice.

Warren’s concerns are echoed by current HUD Secretary Julian Castro, who said in an interview with National Public Radio Monday that he feared Carson could pull back on the efforts the Obama administration has undertaken to enforce fair housing laws.

“I’d be lying if I said that I’m not concerned about the possibility of going backward, over the next four years,” Castro said in the interview.

HUD, as the agency overseeing the Federal Housing Administration, has also been involved in significant litigation against the likes of Deutsche Bank, HSBC, Bank of America and JPMorgan Chase & Co., among others, seeking to recover money the FHA lost on bad loans they sold to the agency.

“Will you commit to continuing to strictly enforce these underwriting standards in order to protect taxpayers from fraud?” Warren asked.

Carson has also drawn criticism from fair housing advocates for his views on the assistance the government provides to the poor, saying in his memoir that such programs can breed dependency when they do not have time limits.

To that end, housing policy experts will want to hear what Carson wants to do to ease the affordability crisis, boost multifamily building and improve conditions inside public housing units. HUD also plays a major role in disaster relief operations, another area where people will be curious about Carson’s thinking.

“I’d be looking at hints of his positive agenda, not just critiques of past programs,” Reiss said.

Why Doctors Buy Bigger Homes Than Lawyers

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photo by Ben Jacobson

Realtor.com quoted me in Why Doctors Buy Bigger Homes Than Lawyers (and What It Means to You). It reads, in part,

Take that, Alan Dershowitz: Although both doctors and lawyers can typically afford better-than-decent-sized homes, a new working paper from the National Bureau of Economic Research found that in states with a certain legal provision, physicians’ houses are bigger. Often much bigger.

So what’s the deal? It seems to come down to two factors: First, the skyrocketing costs of financially devastating medical malpractice suits; second, a once-obscure provision called “homestead exception” which can protect the assets of doctors in some states from being wiped out by those suits when they invest their cash in their homes.

“We have been interested in understanding how does that pervasive aspect of a physician’s career influence the decisions they make … whether it means they invest more in houses to protect themselves against liability,” Anupam Jena, an associate professor of health care policy at Harvard Medical School and a co-author of the paper, tells the Washington Post.

Here’s how homestead exception works: If creditors are hounding you for unsecured debts—as opposed to secure ones, like your mortgage—they can’t take your home as collateral, as long as you declare bankruptcy. In fact, they can’t even place a lien on the property to collect when you sell. These exemptions vary by state: Some, such as New Jersey, have no such safeguard; in California, individuals’ homes are protected up to $75,000 (which generally won’t get you past the front porch).

Yet a handful of states—Arkansas, Florida, Iowa, Kansas, Oklahoma, and Texas, as well as the District of Columbia—have unlimited homestead exemption. Doctors in those states bought homes that were 13% more expensive than the homes of doctors elsewhere. The homes of medical doctors (and dentists, who are essentially in the same medical malpractice boat) were markedly more expensive than the homes of professionals making similar salaries—even lawyers, who know a thing or two about malpractice suits. The authors drew from U.S. Census Bureau data on 3 million households about profession, household income, and home value.

So why should you care? Because homestead exemptions apply to you, too—even if the closest you come to the medical profession is annual checkups and late night reruns of “ER.”

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But don’t get the wrong idea: The homestead exemption isn’t a bulletproof way to ward off foreclosure. Remember, it applies only to unsecured debt such as credit cards—not secured debt like your mortgage.

“If you borrow money for a home, the homestead exemption typically does not apply,” says David Reiss, research director at the Center for Urban Business Entrepreneurship at Brooklyn Law School. In other words, if you don’t pay your mortgage and default on your loan, your lender can foreclose and seize your home.

And we’re not saying you should run from your creditors, because eventually they’ll catch up to you. But if you are in financial straits and scared sick of losing your house, check your local homestead exemption laws first—you might be safer than you think.