Obama’s massive mortgage-bailout plan is nothing more than a thinly disguised entitlement program that redistributes income from the responsible 92 percent of home-owning mortgage holders who pay their bills on time to the irresponsible defaulters who bought more than they could ever afford.
This is Obama’s spread-the-wealth program in action.
Team Obama is rewarding bad behavior.
It is enlarging moral hazard.
It is expanding its welfarist approach to economic policy. And with a huge expansion of government-owned zombie lenders Fannie Mae and Freddie Mac, Team Obama is taking a giant step toward nationalizing the mortgage market.
If the government really wants to help, instead of bailing out irresponsible mortgage holders, it should support new and younger families who want to buy starter homes and begin to climb the ladder of prosperity.
Kudlow reports that in some of the hardest-hit areas of the country, markets are already solving the housing problem.
That can only mean that Obama’s stubborn refusal to have any faith in the free market is obviously the result of his commitment to take us into socialism sooner than later.
Kudlow continues:
All this is Free-Market Economics 101. And I say, let free-markets work.
Let’s remember that most folks — even those with underwater mortgages, where the loan value is more than the home value — do not walk away from their obligations. They don’t want to wreck their credit — and their homes are their castles.
That’s the American way.
But if we penalize the good guys and subsidize the bad ones, we are undermining the moral and economic fabric of this country.
While prudent people were budgeting within our means, paying down our mortgage, driving one newer car and a second 8-year-old car, the folks being bailed out were getting every credit card they could get their hands on.
They bought 2nd mortgage financed boats and RV’s, no down payment plasma TV's, credit card financed vacations and designer clothes.
They denied themselves nothing and now the taxpayers are going to finance their new low interest rate loans and monthly mortgage payments.
I think I'm going to be sick.
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A picture of my cave
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