Should The Government Steal Your Money to Pay Someone Else's Mortgage?

[Scarecrow Akhbar]

SOWELL: Subsidizing bad decisions

Now that the federal government has decided to bail out homeowners in trouble, with mortgage loans up to $729,000, that raises some questions that should be asked but seldom are asked.

Since the average American never took out a mortgage loan as big as 700 grand - for the very good reason that he could not afford it - why should he be forced as a taxpayer to subsidize someone else who apparently couldn't afford it either, but who got in over his head anyway?

Why should taxpayers who live in apartments, perhaps because they did not feel they could afford to buy a house, be forced to subsidize other people who could not afford to buy a house, but who went ahead and bought one anyway?

We hear a lot of talk in some quarters about how any one of us could be in the same financial trouble that many homeowners are in if we lost our job or had some other misfortune. The pat phrase is that we are all just a few paydays away from being in the same predicament.

Another way of saying the same thing is that some people live high enough on the hog that any of the common misfortunes of life can ruin them.

Who hasn't been out of work at some time or other, or had an illness or accident that created unexpected expenses? The old and trite notion of "saving for a rainy day" is old and trite precisely because this has been a common experience for a very long time.

What is new is the current notion of indulging people who refused to save for a rainy day or to live within their means. In politics, it is called "compassion" - which comes in both the standard liberal version and "compassionate conservatism."

The one person toward whom there is no compassion is the taxpayer.

...

In his usual direct style, Sowell hammers it home.

Should taxpayer dollars be used to prevent mortgage foreclosures?

 

[jamesrage]

Our tax dollars shouldn't be used to bail anyone out. We didn't force the banks to make those risky loans,they could have said no. We didn't force people to make risky business decisions. Nor did we force people to buy homes they couldn't afford,they can live in a rental they can live where the cost of living is cheaper so that the homes will be cheaper, you can buy homes in my city for under $20,000.

 

[RightinNYC]

Since the average American never took out a mortgage loan as big as 700 grand - for the very good reason that he could not afford it - why should he be forced as a taxpayer to subsidize someone else who apparently couldn't afford it either, but who got in over his head anyway?

The "average American" doesn't pay **** in taxes anyways, so why should the "average American" care?

 

[Harry Guerrilla]

The "average American" doesn't pay **** in taxes anyways, so why should the "average American" care?

It diverts funds from actual important things like roads, etc.

This the reverse of positive behaviorist therapy and it is very bad to encourage stupid.

 

[obvious Child]

This is really no different then the current medicare/medicaid.

Did you know at least 15% of your private premiums for your private plans are being taken by the government to fund both of those programs?

Welcome to America. It's been like this for years

 

[Harry Guerrilla]

This is really no different then the current medicare/medicaid.

Did you know at least 15% of your private premiums for your private plans are being taken by the government to fund both of those programs?

Welcome to America. It's been like this for years

Not that I don't believe you.

Do you have a link for this?

 

[obvious Child]

Not that I don't believe you.

Do you have a link for this?

Nothing that's public (and there's a reason for this). I do however know people that work in the private healthcare insurance industry. The stuff that they are willing to say is pretty frightening. One of my long time friends works in a firm that regulates them. The stuff he told me a few months back made my hair stand up. I further got no reason to think he's lying to me. He might be breaking his NDA though.

 

[Harry Guerrilla]

Nothing that's public (and there's a reason for this). I do however know people that work in the private healthcare insurance industry. The stuff that they are willing to say is pretty frightening. One of my long time friends works in a firm that regulates them. The stuff he told me a few months back made my hair stand up. I further got no reason to think he's lying to me. He might be breaking his NDA though.

Even it involves public tax dollars it shouldn't be a private issue.

 

[obvious Child]

Even it involves public tax dollars it shouldn't be a private issue.

You'd think that's how it's suppose to be. But M&M are so underfunded that the gov't has done some downright questionable things to keep them alive. It might actually be IOUs to the insurance industry rather then outright theft, but given how shaky the Gov't balance sheet is, it's not much of a difference.

 

[Harry Guerrilla]

You'd think that's how it's suppose to be. But M&M are so underfunded that the gov't has done some downright questionable things to keep them alive. It might actually be IOUs to the insurance industry rather then outright theft, but given how shaky the Gov't balance sheet is, it's not much of a difference.

I found something that may be close to what your talking about.

California Chronicle | Private Payers Subsidize Public Programs; Only Slight Effect from Uninsured

 

[akyron]

In his usual direct style, Sowell hammers it home.

Should taxpayer dollars be used to prevent mortgage foreclosures?

Obama does not have empathy or a connection with the common taxpayer. He does not know any. Look who he appoints to office. Tax dodgers and more tax dodgers.

 

[RightinNYC]

It diverts funds from actual important things like roads, etc.

This the reverse of positive behaviorist therapy and it is very bad to encourage stupid.

The point is that the "Average American" is having maybe $5 of their tax dollars go to something like this. The vast majority of tax comes from "Not-Average American," which is why I get a kick out of populist screeds like the one in the OP.

OH NOES jim bob is gonna have 40 cents of the $200 he paid in taxes last year go towards mortgages instead of to road building in montana!!!

 

[Harry Guerrilla]

The point is that the "Average American" is having maybe $5 of their tax dollars go to something like this. The vast majority of tax comes from "Not-Average American," which is why I get a kick out of populist screeds like the one in the OP.

OH NOES jim bob is gonna have 40 cents of the $200 he paid in taxes last year go towards mortgages instead of to road building in montana!!!

Wouldn't you agree though that at least on principal its better for the .40 to go toward a road in Montana than a dill holes mortgage.

 

[RightinNYC]

Wouldn't you agree though that at least on principal its better for the .40 to go toward a road in Montana than a dill holes mortgage.

In terms of principal, we should be thinking about mortgages.

YouTube - Punch line drum

In principle, I don't think it really matters that much. There's a pretty good argument that it will benefit the economy more to deal with mortgages than with roadbuilding, questions of moral blame aside.

 

[Harry Guerrilla]

In terms of principal, we should be thinking about mortgages.

YouTube - Punch line drum

In principle, I don't think it really matters that much. There's a pretty good argument that it will benefit the economy more to deal with mortgages than with roadbuilding, questions of moral blame aside.

In the short term you are right.

In the long term though it is negative behavior support.
People develop a heightened sense of government dependence if they know that every time they collectively fail the government will bail them out.

It adds more interest to the national debt and the short term benefits are wiped out.

 

[BulletWounD]

If the government's going to steal my money, I'd rather them use it to pay off mortgages than just hand it to the bankers and buy out failed institutions. At least then it'd be helping real people.

 

[RightinNYC]

In the short term you are right.

In the long term though it is negative behavior support.
People develop a heightened sense of government dependence if they know that every time they collectively fail the government will bail them out.

It adds more interest to the national debt and the short term benefits are wiped out.

I'm not sure that individual reliance on government is the biggest problem we're facing now.

 

[freemyspeech]

Absolutely not.

 

[Vader]

THis whole poll is nothing but Ad hom.

 

[Scarecrow Akhbar]

The point is that the "Average American" is having maybe $5 of their tax dollars go to something like this. The vast majority of tax comes from "Not-Average American," which is why I get a kick out of populist screeds like the one in the OP.

OH NOES jim bob is gonna have 40 cents of the $200 he paid in taxes last year go towards mortgages instead of to road building in montana!!!

So, you think it's okay to shove a gun in someon's face and rob them, if they take only five dollars and tell them it's for a "good cause"?

Strange, I don't think that way.

 

[Scarecrow Akhbar]

In principle, I don't think it really matters that much. There's a pretty good argument that it will benefit the economy more to deal with mortgages than with roadbuilding, questions of moral blame aside.

It would benefit the economy even more if the people who can't uphold their end of the mortgage get their asses kicked out to the curb so someone who can afford the mortgage can move in and take over.

Where did the holy reverence people hold these indigent bums in come from, anyway?

The best thing for the economy is to get the non-paying people out of the mortgage properties they failed to buy, and let people who can buy them buy them at a bargain.

The bums can go back to renting, the leftist goal of cheap housing will have been met, and the economy will finally bottom out and the people respsonsible for it will bear their share of the cost, while the people who weren't responsible for any of it won't be taxed pointlessly.

Let the free market go free, and things wills start to get better. I'm begining to think you people seriously want Obama to set new unemployment records.

 

[RightinNYC]

So, you think it's okay to shove a gun in someon's face and rob them, if they take only five dollars and tell them it's for a "good cause"?

Strange, I don't think that way.

No, my point is that I don't give much weight to populist screeds like the OP's article. The "average American" seems a lot more outraged by this than anyone else, despite the fact that the "average American" probably pays little to no taxes.

It would benefit the economy even more if the people who can't uphold their end of the mortgage get their asses kicked out to the curb so someone who can afford the mortgage can move in and take over.

Would it really? Do you think there are that many people looking to buy second and third and fourth homes? Further, how do you know that the eventual price it would be bought at isn't low enough that the first family could have stayed there otherwise? Seems to me like in that case, you could save the transaction costs and simply modify the mortgage, unless you're particularly concerned about what's "morally right."

Where did the holy reverence people hold these indigent bums in come from, anyway?

It's not "holy reverence," it's a practical understanding that when you kick millions of people out of their homes, it causes disruptions in the economy. You don't have to like them to understand that.

Let the free market go free, and things wills start to get better. I'm begining to think you people seriously want Obama to set new unemployment records.

Yea, you know me - Obama-fanatic all the way.

 

[DeeJayH]

The "average American" doesn't pay **** in taxes anyways, so why should the "average American" care?

how about because it goes against my principles and beliefs of the role the govt is meant to play

 

[Scarecrow Akhbar]

Would it really? Do you think there are that many people looking to buy second and third and fourth homes?

Is your imagination really as limited as your question indicates?

You can't imagine that there's a large core of Americans who are responsible with their money who recognized they couldn't afford a home so they didn't apply for a mortgage in the crazy inflated market of the recent past, and that they're not waiting for market prices to climb down from the stratosphere so they can pick up bargains....if the god damned stupid interfering government would get out of the friggin' way so the people who can't pay their mortgages can get kicked out to the curb where they belong?

Further, how do you know that the eventual price it would be bought at isn't low enough that the first family could have stayed there otherwise?

Whatever...the "first family" are supposed to get their asses kicked out so the bank can resell the property...because they owe a current debt, they're not supposed to have the wherewithal to immediately jump back into the market to play games again. I would say that withholding assets to that extent constitutes fraud and they should be prosecuted.

Whatever, if they do manage to have the funds to bid on the property at auction, let 'em.

Seems to me like in that case, you could save the transaction costs and simply modify the mortgage, unless you're particularly concerned about what's "morally right."

Guess what? That's a matter for THE BANK...and the BORROWER. Not the government. If THE BANK wants to boot the delinquent BORROWER to the street, the government has absolutely no business interfering.

If the BORROWER can't keep up the payments, it become THE BANK's choice to re-negotiate or re-possess, and ONLY the bank's choice.

It's not "holy reverence," it's a practical understanding that when you kick millions of people out of their homes, it causes disruptions in the economy. You don't have to like them to understand that.

You mean the economy isn't disrupted when you steal money from millions of responsible people to keep other people, irresponsible people, in homes they can't afford, and thereby prevent responsible people from finding affordable housing for themselves.

Welfare is an illness that destroys not only the minds and morals of those who recieve it, but the minds of the people that insist it should be given.

 

[Kushinator]

The "average American" doesn't pay **** in taxes anyways, so why should the "average American" care?

Its called moral hazard.