Good news: distressed homeowners eligible for counseling
Rarely does a single story so perfectly illustrate the corruption that now pervades the American body politic:
Senate Democratic and Republican leaders rushing to address the nation’s housing crisis reached agreement yesterday on a package that would provide billions of dollars in tax rebates to the slumping home-building industry while offering little to homeowners threatened with foreclosure.
[…]
… lawmakers settled on a sharply scaled-back array of measures that would provide $4 billion in grants for cities to buy foreclosed properties, temporary tax breaks worth up to $7,000 for home buyers who purchase foreclosed properties, and new tax deductions for almost every American who owns a home. The package, which would cost about $15 billion over the next 10 years, also would jump-start stalled legislation to streamline the Federal Housing Administration, one of the top priorities of the Bush administration.
Families who cannot afford to repay their home loans — the group at the heart of the mortgage meltdown — would benefit mainly from $100 million to expand foreclosure counseling services and greater latitude for local housing authorities to use tax-exempt bonds in refinancing subprime loans.
Home builders and other businesses suffering losses in the flagging economy, meanwhile, would get the lion’s share of federal spending in the bill: $6 billion in tax rebates. [Emphasis added.]
In other words, the government isn’t going to bail out people who failed to read the fine print of their mortgage contracts, or who bought more home than they could afford. And that’s fine. If we subsidize inappropriate risk-taking, we’ll get more inappropriate risk-taking. But to pony up billions for home builders and local governments and pass that off as a solution to the “housing crisis” is a disgrace.
Also, note the bipartisan nature of this indecency. I’m not a Democrat. But more and more, I think I’m not a Republican either.