GOPideas... ideas done right

Many of the public policy challenges that confront the nation can be traced to one simple issue: that policies were made based upon what made people feel good at the time, instead of a thorough analysis of present and future challenges and constraints. Such decisionmaking is assured to do a number of things: appease the special interests currently advocating for change, mollify the marginal opposition with "feel good" concessions and ensure that future generations will be confronted with similar or greater problems.

Today’s headline story on CNBC is a great example of how politicians (left and right) use policy change to further temporary political interests while harming future generations. As previously written on this site, the Obama housing plan is a rigged game, designed to reward people for making poor decisions. However, it is a brilliant plan because it forces banks to eat the losses and then (indirectly) pass those losses on to taxpayers or shareholders. Thus, the Obama administration looks like heroes for “saving” a person’s home --- and the losers are thought to be the big bad banks (but in actuality are taxpayers).

Read the first line of the CNBC story:

“Within weeks of taking office, U.S. President Barack Obama rode to the rescue of homeowners resigned to financial ruin.”

Really? Barack Obama rescued homeowners? I thought it was the banks that were writing off loans and the taxpayers who subsidized the HAMP program. If you’re not yet convinced of the moral necessity to pay someone else’s bills, the story continues with the requisite sob stories to make you feel guilty:

“For homeowners like Jeff Latta, there was no help at all. Latta, a 53 year-old retiree, pays $1,600 in monthly home payments that eat up 93 percent of his pension and he struggles to make child support payments. To help pay his mortgage, Latta has slashed his bills by hunting for food in the wooded hills around his town of Albany in southern Ohio, and growing his own vegetables. He has resorted to selling pumpkins and firewood to make cash. ….  "Frankly, I'm disappointed," Latta said. "I thought I would qualify as I am at high risk of default."  Foreclosure prevention advocate Bryce Burton at Ohio Housing Finance Agency said Latta's bank miscalculated his income. "Jeff is a shining example of someone doing everything they should be to keep their house," Burton said. (emphasis mine).

Not to resort to the obvious, but if “everything” is being done, then why is there an issue, since there the sum total of “everything” is actually one thing: pay the mortgage. More importantly, 53 year old retiree? (Who has been retired for a while, since he was struggling to make payments last year.) With child support payments? So, the guy can’t make his payments because he voluntarily left his job 15 years before retirement age while he had multiple financial obligations? And fellow taxpayers should be bailing him out … and the state government thinks he’s doing everything he should?

Both the reporting and reaction by the Ohio government (the state is currently suing to force more modifications) are prime examples of the entitlement culture that existed before Obama, which he is now dramatically expanding. Essentially, the moral is: “go ahead and do what you want. If, at any point, things do not turn out well for you, expect someone else to bail you out. You may have left your job, spent money you did not have, made poor financial decisions, made unwise lifestyle choices, but if you have a story, we have some money.”

And that’s the problem. Just because someone thinks that they deserve something, doesn’t mean they do --- unless, of course, politicians want you to feel good about them, at which point they’ll just go ahead and give it to you.