southchild

Terence Jeffrey has a column today that illustrates the immorality of the House, and likely Senate, bailout bill. This bailout bill will reward the irresponsible borrowers who over-borrowed, overspent, and then defaulted on their mortgages. At the same time, the bill punishes the responsible citizens who didn’t make these mistakes.

This is madness. This is Socialism. Instead of redistributing income from those who earn it to those who don’t, this bill redistributes income from those who saved to those who blew it. This is unprecedented, immoral, and anti-American. This is the subsidization of irresponsibility, something we’d expect Democrats to support, but Republicans?

Are there any Congressmen, from either party, who represent responsible Americans?

Read Who Needs to Pay Their Mortgage and Who Doesn’t?

Will the U.S. Treasury Department help pay your mortgage or force you to help pay someone else’s? …

The Wall Street-Washington establishment is sending taxpayers this message: Stop harping about our failed past policies and unbridled greed. We have put a gun to the head of the U.S. economy. If you don’t give us what we want now, we will blow the economy away. We will kill all your hopes and dreams. We will wipe out the fruits of all your past work and sacrifice.

Give us $700 billion now — or else. …

Consider what the bailout bill that failed Monday envisioned the secretary of the treasury, and other federal agencies that ended up controlling these mortgages, doing with the bad ones.

“(T)he Secretary shall implement plans that seek to maximize assistance for homeowners … including term extensions, rate reductions (and) principal write downs,” the bill said.

“(T)he Federal property manager shall implement a plan that seeks to maximize assistance for homeowners,” it said. “In the case of a residential mortgage loan, modifications made under paragraph (1) may include — (A) reduction in interest rates; (B) reduction in loan principal; and (C) similar modifications.”

In other words, if your neighbor took out a $300,000 mortgage even though he could only afford a $200,000 mortgage, the federal government — which would now own your neighbor’s mortgage — could simply reduce what your neighbor owes from $300,000 to $200,000. And it could reduce his interest rate from 6.5 percent to 5.5 percent. And it could extend the time he has to pay from 30 years to 40 years.

What would this say to the people in the neighborhood who did not overextend themselves and who faithfully pay their mortgage every month? It would say: You’re a fool. Your profligate neighbor took the wiser course.

And it would also say: Please keep paying your taxes on time because we may need your money to cover the $100,000 we just cut from your neighbor’s mortgage.

Read on for a proposal that, while still a bailout, wouldn’t turn “the U.S. Treasury into the world’s largest mortgage broker.”

This entry was posted on Wednesday, October 1st, 2008 at 1:57 pm and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.