The chickens have come home to roost on the speculative Bush economy - an economy built on massive amounts of debt - and working Americans are going to pay the price. More U.S. workers will lose their homes through foreclosures this year than at any time in U.S. history, and 2008 will set a new record. Tens of thousands of workers in construction, financial services, and consumer products industries will lose their jobs as the debt based economy retrenches. Since its most recent peak in September 2006, the construction industry has shed 75,000 jobs.

The answer to the question of why Americans are so pessimistic about the economy even as the unemployment rate is low can be found in the housing crisis itself. The average American understood clearly that he was financing his or her family's lifestyle, not with rising real wages, but with debt based on false home asset values (home equity loans) or on debt they could not service (e.g., so-called subprime loans or adjustable rate mortgages).

Sixty percent of the adjustable rate loans issued since 2004 will be reset to payments that are 25 percent higher or more, and one fifth will reset to payments that are 50 percent higher.

Among those who bought their homes in 2006, 18 percent now have mortgages that are more than the value of their homes. Even families who have real equity in their homes will not be able to sell them when they can't cover the payments. There is a six-month glut of houses already on the market and this number will soar as more foreclosures kick in.

No one should be surprised. When the economy began to slow in 2001, bankers looked for a way to boost the mortgage market by pushing homeowners to take on dangerous levels of debt. Lenders created the subprime mortgage industry to pull in billions in interest payments from borrowers who were not able to tap the traditional mortgage market. Now that these lenders have exhausted industry's profit-making potential, they're packing up and shutting down.

The winners in the mortgage "crisis" include the investors who pocketed high returns from their mortgage-based assets, the ratings agencies and brokers who collected huge fees, the mortgage lenders and bankers who grew rich off of interest payments, and the builders who sold homes to buyers who could not afford them.

Dishonest mortgage brokers lied about the cost of the loans, appraisers inflated home values, and real estate agents convinced millions that they could safely finance homes with no down payment, teaser rates and interest-only mortgages. Bankers sold home equity loans to workers who were struggling to make ends meet.

During the subprime boom, predatory lenders argued that they actually helped boost home ownership for workers at lower income levels. But instead of increasing home ownership, subprime loans totaling more than $2 trillion over the past nine years have led or will lead to a net loss of homeownership for one million families. The Center for Responsible Lending reports that more than 15 percent of subprime loans have ended or will end with the borrowers losing their homes through foreclosure.

These predatory lenders deliberately targeted black and Latino workers. Half of all the mortgages taken out by black families in the past few years were subprime, according to the Center for Responsible Lending.

Radical action is needed to simultaneously rescue thousands of families and prevent the economy from going into a severe recession.

It's time to put the pressure on Congress to take action to stop the foreclosures, rewrite regulations for lending, and provide authorization for the Federal Housing Administration to refinance the subprime loans now in default.

Greg Tarpinian is the Executive Director of Change to Win.