Southampton - The economy was the topic of conversation this week when a group of real estate agents met over breakfast with Congressman Tim Bishop (D-Southampton) at 75 Main in Southampton. Bishop, the featured speaker at the Hamptons North Fork Realtors Association's (HANFRA) quarterly breakfast on Feb. 9, highlighted the importance of the real estate market in the nation's economy.

"The way into this recession was housing and the way out of this recession is housing," Bishop said noting tax relief would not bolster the failing economy. Bishop pointed to the need for aggressive government spending to avoid "a second Great Depression" as he advocated passage of the Obama administration's economic stimulus package. "To call this high stakes is not to do it justice," Bishop said emphasizing the importance of spending and lending to revitalize the nation's faltering economy.

Bishop had harsh words for the nation's bankers and Wall Street power players describing the lack of accountability as a serious disconnect.

The Congressman noted consumer spending accounted for nearly 70 percent of the country's gross domestic product (GDP). "People are not spending money," Bishop stressed, noting consumers fell into two categories, those who had no money to spend, and those who had money but were not spending because of the prevailing economic uncertainty.

The lack of spending and lending despite the first phase initiated under the Bush administration's $350 billion bailout is stalling the nation's economic recovery according to Bishop.

Bishop had harsh words for the nation's bankers and Wall Street power players describing the lack of accountability as a serious disconnect. "The arrogance of receiving $40 billion from the federal government than telling us it is none of our business how that money gets spent is a serious disconnect. It is also unbelievable arrogance", Bishop said. According to Bishop the mood in Congress is towards more accountability and transparency as the second phase of the bailout moves forward in Congress. "The banks got the money but they are not lending it," Bishop said.

Describing a recent meeting with a constituent from the western end of his district who was unable to secure a bank loan despite ownership of three car dealerships valued at $14 million and 780 credit scores, Bishop recounted, "He had 140 employees a year ago, today he has 60, and he can't get a loan."

Making a pitch for the stimulus package being hashed out on Capitol Hill, Bishop asserted, "The government has to spend money, because the consumers aren't spending." Members of the House and the Senate have been in conference this week to reconcile differences in the stimulus legislation.

"These are problems that only the government can solve," Bishop charged, pointing to the loss of 3.6 million jobs nationwide in 2008. "The nation's economic systems have stopped functioning."

He advocated extending unemployment benefits to those out of work for a longer time period and emphasized the need to make food stamps available to more people. "This will put money back into the economy," he asserted, noting tax breaks did not result in increased consumer spending due to the tendency of those benefiting from the tax breaks to save rather than spend that money.

The real estate agents in attendance pointed to the growing number of foreclosures and short sales in the local market where these were rare occurrences. "No one benefits from a foreclosure," Bishop said. "Not the bank, not the neighborhood, not the homeowner." According to Bishop present legislation under consideration by both the House and the Senate to give $7,500 to $15,000 tax credits to first-time homebuyers would help the housing market. Programs now in place extend a tax credit but require homeowners to repay the amount of the credit over 30 years. The plans now under consideration would be genuine credits with no paybacks.

When the Congressman opened the floor to questions one broker inquired if this was a good time for property owners to grieve their property taxes. Bishop's answer was a crowd pleaser. "There is no good and there is no bad time to grieve your taxes," noting homeowners are being assessed based on property values that may have been a true reflection of their property values three years ago.

Former HANFRA President John Nickles of Lewis and Nickles Real Estate noted the North Fork was hopping. "For unexplained reasons there is a lot of activity on the North Fork," Nickles said. "If things fall into place the economic recovery could start right here in this room."

Then someone expressed concern for the Congressman in these stressful times. "How are you doing Congressman?," the unannounced broker asked. "Let me just put it to you this way," Bishop, the former provost of Southampton College said, "it beats running Southampton College. I'm fine."