An economic stimulus is designed to do two things: pump money into a flagging economy and help hardworking people to weather tough economic times.

The economic stimulus bill the President signed marks a major bipartisan investment in achieving both of those goals. But unfortunately, it fails to address what is perhaps the greatest economic concern of families in Massachusetts and across the country: the fear of losing one’s home.

That’s why this week when Congress returns to Washington, and as some tough economic realities continue to hit home, we need to continue the fight to help hardworking families keep the roofs over their heads.

We’ve seen how a wave of foreclosures can have a ripple effect across the economy. By late 2007, 2.5 million mortgages were in default—a 40% increase from just two years earlier. Just as watching families lose their homes played a role in souring the economy, helping families to stave off foreclosure can help contain the damage.

Last month, foreclosures in Massachusetts alone were up 128% from the previous January. In fact, in 2007, 1.6 million Americans defaulted on their home loans, and as many as 3.5 million more are expected to do the same by mid-2010. Communities across Massachusetts are being hit hard. In Dorchester, seven homes on Hendry Street have been abandoned thanks to foreclosures. Just down the street, six more homes on Coleman and Clarkson streets have been boarded up, too. Brockton had 400 foreclosures last year and expects 400 more this year. .

Each time a home is foreclosed upon, a family’s economic dreams lies in tatters—and neglected buildings can bring urban blight and destroy entire neighborhoods. According to the US census, by late 2007 a higher percentage of homes in the Northeast sat vacant than at any time in the last 50 years.

Everyone acknowledges both the urgency and the complexity of this problem. For all its devastating impact, today’s mortgage crisis is not a simple story—and it doesn’t have a simple solution. But that doesn’t mean Congress shouldn’t fight to help many of those families escape the nightmare of foreclosure.

That is why I have teamed up with Republican Senator Gordon Smith of Oregon to offer an amendment in the pending housing debate to address these families’ concerns.

Some families who signed onto bad mortgage deals can still save their homes and switch over to safe, fair fixed-rate mortgages. To help them do so, we propose creating new capital by making it easier to use mortgage revenue bonds to refinance subprime loans.

By including approximately $211 million in targeted mortgage relief to the homeowners of Massachusetts, we intend to create a targeted, timely, effective relief package to the people of the Bay State. Too many low-and moderate-income families are trapped in abusive predatory mortgage loans. With the additional funding from mortgage revenue bonds, those more likely to be trapped in a subprime loan would have an opportunity to keep their house and avoid foreclosure.

This approach should have been included in the economic stimulus package because it will help with today’s economic troubles: every mortgage revenue bond loan for a new home produces almost two full-time jobs-- $75,000 in additional wages and salaries; and $41,000 in new federal, state, and local revenues according to the National Association of Home Builders (NAHB). Each mortgage revenue bond loan for an existing home results in an average of $3,700 in new spending on appliances, furnishings, and property alterations.

Under current law, state and local governments may issue bonds to finance new mortgage loans to first-time homebuyers. Gordon Smith and I propose temporarily expanding the use of this program to include refinancing of subprime loans. We also propose allowing states to issue up to $10 billion in additional bonds over the next three years. This way, homebuyers facing foreclosure can refinance at a safe, fair rate. According to the National Council of State Housing Agencies, this would lead to roughly 80,000 new loans—each with the potential to save someone’s home.

Nobody wins with foreclosure: banks lose future mortgages payments and families watch helplessly as their homes are taken away from them.

If we really want to address the economic anxieties of the average American, we must deal with the mortgage crisis – and in the days ahead I will continue to press Congress to act quickly to help hardworking families to keep their homes.