It’s Time to Hear From Pierce


Samuel R. Pierce Jr. has refused to testify before a congressional subcommittee investigating waste, fraud, mismanagement, theft and political favoritism during his tenure at the U.S. Department of Housing and Urban Development. He has cited his Fifth Amendment protection against self-incrimination, as is his right.

Pierce, a corporate attorney and former federal prosecutor, claimed he was being “prejudged” by members of the Government Operations subcommittee on employment and housing. He, and his hastily hired lawyers, he said, hadn’t had enough time to prepare, and they didn’t have all records from his eight years at HUD. As the allegations mounted, Pierce said he had no choice other than to remain silent. The better choice would have been to tell the truth about what happened while he headed HUD.

While Pierce was chief, well-connected Republicans got rich from scarce housing dollars intended to rehabilitate housing for poor families. They steered grants to developers in exchange for big fees for making a few phone calls and setting up a few brief meetings. The pay-offs for influence-peddling topped $6 million, according to a recent report to Congress.


The squandering of housing dollars continued as private mortgage brokers stole millions from the sales of foreclosed HUD properties. The thefts were made easier because HUD had eliminated many auditors as a cost-saving measure. That cost-cutting measure saved the taxpayers nothing.

A new scandal in HUD focuses on the Federal Housing Administration, the government’s largest real estate mortgage program. The FHA helps millions of Americans buy homes. It also guarantees loans for hospitals, land development and property in older urban areas and apartments. But the program is plagued by deficits of $4.2 billion, according to a federal Government Accounting Office report released this week. Again the taxpayers must pay for substantial losses during Pierce’s watch. How high will the total losses climb--upwards of $7 billion, as some congressmen predict? Are there more troubles at HUD?

The former housing secretary will have another chance to make a full explanation. He has been subpoenaed again on Oct. 27 and Nov. 3. The future dates ought to provide enough time for Pierce and his lawyers to prepare.