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Wednesday, April 2, 2008
Sit tight. Housing bailout’s coming.
The Atlanta Journal-Constitution
U.S. Senate Majority Leader Harry Reid insists that it wasn’t an April Fool’s joke.
Too bad. It should have been.
The proposed plan of action to bail out lenders and homeowners at risk of foreclosure announced on April Fool’s Day proves two things. One is that when a sufficient number of voters engage in irresponsible behavior — buying homes they can’t afford and agreeing to high-risk adjustable rate mortgages — some government will bail them out. The second thing it proves is that in an election year, incumbent politicians will quickly and gladly spend your money to preserve their incumbency. That’s what the word “bipartisan” often means — as in “casting aside partisan differences, Senate Democratic and Republican leaders…” propose a bailout.
The bailout package will spend $200 million of public money to counsel homeowers at risk of foreclosure.
It will authorize $10 billion in tax-exempt bonds for local housing authorities to refinance subprime loans and $4 billion to local governments to buy foreclosed properties.
It will pick up a version of a proposal by Georgia’s Johnny Isakson, with a $15,000 tax credit for purchasers of foreclosed homes or new homes that have not sold.
Too, committees are working on plans to allow the Federal Housing Administration to insure $300 to $400 billion in additional mortgages.
With the $168 billion economic stimulus package that will send government checks of $600 to $1,200 to 130 million households approved earlier, no voter should have any reason to vote against any incumbent at the federal level. Unless, of course, the voter actually pays taxes.
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