RPT-Obama picks N.Y. official to run US housing dept.
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CHICAGO, Dec 13 (Reuters) - U.S. President-elect Barack Obama on Saturday named the head of New York's urban housing agency to run the Washington department that attempts to make housing affordable for all Americans and end lingering racial discrimination.
In his weekly radio address, Obama said he would nominate Shaun Donovan to be Secretary of Housing and Urban Development (HUD), a department that has been accused of failing to get rid of racial discrimination in the nation's housing and lending markets.
Obama, who takes office on Jan. 20, said the role of HUD secretary is increasingly important due to the nation's economic problems sparked initially by the subprime mortgage crisis.
"To end this economic crisis, we must end the mortgage crisis where it began," said Obama. "This all started when Americans took out mortgages they couldn't afford. Some were reckless, aware of the risks they were accepting. But many were innocent, tricked by lenders out to make a quick buck."
He said one in 10 families who owns a home is now in "some form of distress" -- the most ever recorded.
"This is deeply troubling. It not only shakes the foundation of our economy, but the foundation of the American Dream," Obama said. "There is nothing more fundamental than having a home to call your own."
He said he has charged his economic team with finding new ways to help more families stay in their houses.
As commissioner of housing in New York, Donovan led the effort to create the largest urban housing plan in the United States, helping hundreds of thousands of people buy or rent their homes, Obama said.
Donovan, 42, also worked for HUD during the Clinton administration, where he ran a multibillion-dollar housing-subsidy program.
Outside of government he has worked at Prudential Mortgage Capital Company as managing director of its FHA lending and affordable-housing investments. Donovan was also a visiting scholar at New York University, where he researched and wrote about the preservation of federally assisted housing.
LINGERING RACIAL SEGREGATION
This week the National Commission on Fair Housing and Equal Opportunity issued a report saying that U.S. housing is still racially segregated 40 years after civil rights laws were approved to end unfair practices.
The report said the segregation also contributed to the subprime mortgage crisis.
The seven-member commission, which based its findings on hearings held in five U.S. cities, said minorities were denied access to traditional home loans. That drove them into costlier subprime mortgages. Continued...
