Jan 20, 2017

Trump order wipes out Obama mortgage fee subsidy

Andrew Harnik / AP

The issue:

One of President Trump's first executive actions in the Oval Office was to order HUD to suspend its planned 0.25% cut in the insurance fee it charges to participants in the Federal Housing Administration's mortgage program.

The facts:

FHA loans are a popular means for first-time homebuyers to finance their purchases. They allow buyers to put as little as 3.5% down, plus an upfront insurance premium of 1.75%. Thereafter the majority of borrowers are charged an annual fee of 0.85% of their loan, which helps the FHA compensate lenders when loans go bad.

The Obama administration's lowering of the fee would have saved the median homebuyer roughly $500 per year, though that can go higher or lower depending on the value of the home. Back in 2013, the FHA had to be bailed out to the tune of $1.7 billion when it insurance fund was exhausted, for the first time in its 80 year history. That's why fiscal conservatives are wary of lowering the insurance premium.

Why it matters:

$500 per year isn't a massive amount of money, but on the margin can be the deciding factor in whether a borrower can afford a home. It is a hint that the Trump administration will place fiscal responsibility over populist programs to support the working class. It's also a move that will disproportionately hit blue-state borrowers, as places like New York and California are home to expensive real estate markets.

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Sign of the times: A pro-Warren super PAC

Democratic presidential candidate Sen. Elizabeth Warren at a rally in Nevada. Photo: Alex Wong/Getty Images

A group of women progressives who back Sen. Elizabeth Warren has formed Persist PAC, a super PAC airing pro-Warren ads starting Wednesday in an effort to boost her performance ahead of Saturday's crucial Nevada caucuses, a spokesman told Axios.

Why it matters: Warren has spoken adamantly against the influence of unlimited spending and dark money in politics. But these supporters have concluded that before Warren can reform the system, she must win under the rules that exist — and that whether she likes it or not, their uncoordinated help may be needed to keep her viable through this weekend's contest and into South Carolina and Super Tuesday.

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Pentagon policy chief resigns amid reported discord with Trump

John Rood. Photo: Mark Wilson/Getty Images

John Rood, the Pentagon's top policy official, will resign from his post on Feb. 28, CNN first reported and President Trump confirmed.

The state of play: CNN said Rood "was perceived as not embracing some of the changes in policy the White House and senior Pentagon officials wanted," such as peace talks in Afghanistan with the Taliban and a decision to cut back on military exercises with South Korea as the president courted North Korea's Kim Jong-un.

Coronavirus cases rise, as warnings of global pandemic grow

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's NHC; Note: China refers to mainland China and the Diamond Princess is the cruise ship offshore Yokohama, Japan. Map: Danielle Alberti/Axios

We may be "at the brink" of a global pandemic, warns a top U.S. public health official, as cases continue to spread despite containment efforts. Meanwhile, the global economy is being affected, including the tech manufacturing industry.

The big picture: COVID-19 has now killed more than 2,000 people and infected over 75,000 others, mostly in mainland China, where the National Health Commission announced 136 new deaths since Tuesday.

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