Hey, This Sounds Familiar

This is more in the great minds think alike category. Or, at least small minds, depending on your politics, lol.

Today, the Gazette echoed in more detail our A Lot of Fine Print post.

The point that we and the Gazette make is that Mark Udall and Ed Perlmutter threw any requirement for personal responsibility out the window when they sponsored legislation that bails out the folks who bet their fortunes that they could profit handsomely from the inflation in their McMansions.

The Gazette added value and additional points to our essay:

Is the government only going to intervene on behalf of at risk borrowers, leaving those who have already been foreclosed-upon out in the cold? If such assistance is predicated on the idea that these people are all the hapless victims of unscrupulous lenders, aren’t the already-foreclosed-upon entitled to something, as well? Will government aid be means tested, or also go to the couple earning $200,000 who bought a mansion during the boom times? Couldn’t the creation of this new government safety net actually encourage delinquencies and defaults, once people know Uncle Sam will help them out of the jam? And what unfortunate new precedent might we be setting? Will the government next come to the aid of those who get in over their heads with credit cards?

There was a good rationale for the savings & loan bailout. Decades before that debacle, the government had required savings & loans to provide government insurance on savings accounts. This sub-prime problem has no such rationale. The government has no business rescuing speculators, even those dumb enough to speculate on their own home, from their own greed.

A Lot of Fine Print

Congress passed a bill to help distressed homeowners who would otherwise be victims of their own greed.

"I know that people have been attracted to subprime mortgages but they have a lot of fine print," ( Mark ) Udall said.

Udall said a United Airlines employee he met at an airport asked him for help because the 5 percent interest rate on her mortgage was about to nearly double to about 9 percent.

You haven't lived until you have seen mortgages at 13% as happened in 1978. How did this airline employee's parents survive back then? Simple, they bought a house within their means. Those who couldn't live by that rule lost their homes.

At some point people have to take responsibility for their own actions. They made a bet that they could make big money on the appreciation of a house they couldn't afford. They lost the bet, and now Udall wants to rescue them.

OK, so we rescue them. Without pain, what keeps them from making the same bet five years from now? Do we rescue them again when the next bet goes bad? Does this turn into another Federal flood insurance program where every few years the government replaces the same house on the same property?

Is this a bill that has safeguards for the taxpayer, or is it just another big give away? It is a complex issue, but safeguards need to be built in or we will pay and pay and pay and no one will learn.

Today, someone noted that all three Colorado Republicans voted against the bill. They were gleefully rubbing their hands in the expectation that it could be made into a campaign issue. Maybe personal responsibility should be a campaign issue. It would be long overdue.