Policy-makers better listen up and do so soon. This, along with Rick Santelli (and by the way, CNBC ran a poll on the “TeaParty”, and over eighty thousand people said they would show up!) is tapping into what America feels about all this nonsense.
Let’s face the facts – 92% of Americans are either paying their mortgage or don’t have one. We didn’t use our homes as ATM machines. We didn’t lie about our incomes. We played by the rules and do not have bone-crushing debt loads.
The rest of America is a different story.
I was watching this video today of Nouriel Roubini, Paul Krugman, Suzy Welch and George Will. It’s interesting that the proponents keep making the point that this solution targets the “social problem” of people who lost their jobs and now can’t pay their loans. But this program doesn’t target people who lost their jobs, it targets people who qualify for the new lowered rate / principal loans. (i.e. people who still have a job.) The only folks I can think of who obviously wouldn’t qualify for their current mortgage, but do qualify for a reduced mortgage at taxpayers expense are the speculators who took out risky loans with balloon payments or interest only periods.
Also, in the interest of fairness, why is there no claw back in these subsidies so that when these owners sell their property down the road for a profit (assuming they don’t default anyway) the taxpayer gets paid back?