The nation's slow pace of growth is now the primary threat to the Obama Administration's bid for a second term, and some economists and political allies say that the cautious response to the housing crisis was the administration's most significant mistake, the New York Times reported yesterday. The bailouts of banks and automakers are now widely regarded as crucial steps in arresting the recession, while the depressed housing market remains a millstone. Obama insisted the government should help only "responsible borrowers," and his administration offered aid to fewer than half of those facing foreclosure, excluding landlords, owners of big-ticket homes and those judged to have excessive debts. Obama said in Arizona a few weeks after taking office that the government would help "as many as three to four million homeowners to modify the terms of their mortgages to avoid foreclosure." As of May, 4.3 million people had applied for aid, but only one million had received government-sponsored modifications, according to the most recent data. About a third of those turned away lost their homes, were facing foreclosure or filed for bankruptcy.
