The concept is based on the model of the U.S. War Bonds when our country generated funds to fight World War II and re-build Europe.
The NDRB would have the following advantages:
1. The NDRB would generate billions of dollars for national recovery efforts whether from earthquakes, floods, hurricanes or terrorist actions. It could be a permanent National Disaster Recovery Bond fund.
2. The NDRB would incentivize millions of Americans and investment funds to invest in the Gulf Zone recovery and other national disaster recovery efforts as may be needed. The NDRB could pay investors a steady and appropriate return.
3. The recipients of debt relief could pay a small monthly fee for 30-40 years on top of any new mortgage or loan. This fee would generate the interest paid to bond holders and help replenish the fund.
4. The economy would be spurred by the new mortgages and purchases to restore homeownership and small businesses destroyed by the disaster.
5. Communities would be stabilized by homeownership recovery.
6. Our financial institutions and economy would be secured against the extraordinary financial impact of national disasters.
SMHA President Lorna Bourg urged Congress to establish a National Disaster Recovery Bond program (similar to the war bonds in World War II). This would generate the billions of dollars needed to fund the long-term recovery of homeowners and businesses devastated by Hurricanes Katrina and Rita, as well as victims of future national disasters in other parts of the country.
Bourg made this and other recommendations as a panelist at a national roundtable discussion March 7 in Washington, D.C. organized by a U.S. Senate committee. (Click link below for copy of her statement and other recommendations such as using Gulf Coast states to model a true homeownership tax credit to incentivize investment in the rebuilding of tens of thousands of homes.)
STATEMENTTOTHEUSSENATECOMMITTEE to read the Statement of Lorna Bourg Executive Director Southern Mutual Help Association, Inc. presented to the U.S. Senate Committee on Health, Education, Labor and Pensions in Washington, D.C. on March 7, 2006.
