THE PLANK APRIL 3, 2008
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Gabor Steingart, who astutely covers Washington
for the German mag Der Spiegel, has written an interesting meditation
on the wishy-washiness of the American electorate. As a result of our two-party,
either-or proposition, we Americans are apparently suffering from a civic form
of multiple-personality disorder--one that leads "the desires of American
citizens [to] contradict their fundamental convictions." Like the voters
who don't
want Hillary Clinton to win, but neither wish her to lose, the entire country
has no idea what it wants out of government. Steingart observes:
The overwhelming majority of Americans are troubled
by the social injustices in their country. They dream of a nation in which
bridges do not collapse and with a school system in which drug dealers are not
the main authority figures. No one doubts that, politically at least, they want
to see these shortcomings corrected.
And yet these very same voters are not allowing
politicians to fulfill their wishes. When it comes to putting these ideas into
practice, Americans quickly drop their idealistic gazes. Their eyes begin to
narrow until they resemble the slits in a piggy bank.
…
Those on the left have expensive wishes and no
qualms about calling for a strong government. Meanwhile, those on the right
want more personal freedom and desire nothing more deeply than a government
that fades into the background.
I'm willing to concede Steingart's broad sketching of liberal and conservative
ideologies (after all, we are not afforded nearly as much spectral
diversity as within Germany's
parliamentary system). I'm also willing to bet that Americans in states both red and blue generally
tend toward Democratic mayors, city councils and school boards (who keep the trash
taken out), while they prefer the large-scale decision-making (primarily, the
burdens of taxation and defense) to fall upon Republican governors or commanders-in-chief.
(If anyone has more concrete informatics, please share.) But is it really, as
Steingart hints, a matter of dollars and cents?
Writing in the Times, Eduardo
Porter made the argument
that it is racial resentment that prevents full-throated public support for a so-called
social safety net; Barack Obama also said as much in his Philadelphia speech on race. Unfortunately,
that seems a plausible explanation. But is it not also America's
timeworn, up-by-the-bootstraps mythology that drives--for example--John McCain's
chilly statements on the current housing crisis? (McCain, recall, advised
the 80 million Americans at risk of foreclosure to get another job and
stop whining.) Robust individualism has done this country a world
of good. But it's the same spirit that prompts majority support for tax
cuts on
the upper one percent of earners, keeps property taxes as the metric
for school funding, and provoked Glenn Beck's odious comment on
teen pregnancy Tuesday: "When are we going to say, sucks to be you, you made a
mistake?"
No matter the cause, it's useful to see a foreign journalist try to
capture the psychosis within the American body politic. And to those
who vehemently disagree with my liberal bias, take comfort in
Steingart's conclusion:
Both fringe groups live in harmony with themselves, because there are
no contradictions between the means and the end. They are not plagued by
self-doubt. Extremists, it appears, are happier.
--Dayo Olopade
12 comments
My apologies. photo software can cause problems on the plank.
blackton said:
This is what McCain said specifically, nothing about getting second jobs and whining (he made the point that many of the 51 million who do pay on time have second jobs, not urging the 4 million who don't to take get them)
In our effort to help deserving homeowners, no assistance should be given to speculators. Any assistance for borrowers should be focused solely on homeowners, not people who bought houses for speculative purposes, to rent or as second homes. Any assistance must be temporary and must not reward people who were irresponsible at the expense of those who weren't. I will consider any and all proposals based on their cost and benefits. In this crisis, as in all I may face in the future, I will not allow dogma to override common sense.
When we commit taxpayer dollars as assistance, it should be accompanied by reforms that ensure that we never face this problem again. Central to those reforms should be transparency and accountability.
Homeowners should be able to understand easily the terms and obligations of a mortgage. In return, they have an obligation to provide truthful financial information and should be subject to penalty if they do not. Lenders who initiate loans should be held accountable for the quality and performance of those loans and strict standards should be required in the lending process. We must have greater transparency in the lending process so that every borrower knows exactly what he is agreeing to and where every lender is required to meet the highest standards of ethical behavior.
Policies should move toward ensuring that homeowners provide a responsible down payment of equity at the initial purchase of a home. I therefore oppose reducing the down payment requirement for FHA mortgages and believe that, as conditions allow, the down payment requirement should be raised
I see nothing there that raises any hackles for me. Not enough detail as to what the assistance will be, but the idea is on the table.
- Dayo Olopade
April 3, 2008 at 7:22pm
I agree Blackton, but how do you explain the big business give away that the Senate is considering in their "home owner assistance" bill? It is just a big present for the jackasses that got us in the mess.
No help for the homeowners? Fine. NO help for ANY business either. Period. You pray at the altar of the free market, then get punished by it too. I'm sick of the hypocrisy from the Chamber of Commerce leeches.
- tnmats
April 3, 2008 at 10:29pm
This situation goes deeper than homeowners going into foreclosure over bad loans and mortgage companies’ slick spin to gain business with fast talk and incomprehensible loan agreements. It goes to the heart of what has become the American way of life. Notice I didn't say the American way of business.
Everyone involved in this crisis is at fault at some level. There is the homeowner who knows that when interest rates are down, home prices rise and places his house on the market for far more than the property is truly worth. There are the real estate agents and appraisers who either are complicit in helping the homeowner, or outright responsible for raising expectations and hopes for those who do not know the tricks of the trade. The potential buyer who knows that the house he is about to buy is not worth the asking price or thinks he can somehow swing a mortgage that should be far outside his range of payment with little to nothing down because the cost that day is something that looks affordable, but does not pay careful attention to the details of the loan he is about to sign; going for the quick and easy adjustable mortgage when for a small fractional percentage more, he can get a fixed mortgage on a lower priced home so that the payments will always be in the correct range of repayment, barring the unforeseeable catastrophe. The financial institutions that buy and sell mortgages with no thought that behind each transaction there is a real person and real property that are not shown on the countless pieces of paper that are shuffled around on desks all over the country.
The general greed and need for bigger and better things pervades all sectors of daily life in this country. It has been going on since after World War II and gets worse with every decade and when each time these newer means for attaining the bigger and better things blows up in everyone’s faces, the congress rides in on its white horse and bails out the big guys and makes a show of letting everyone think it will trickle down to help the little guy and it’s the taxpayers who wind up digging deeper into their pockets and going without to pay for their largess until the next new thing comes along. Meanwhile those of us who can see past the get rich quick plans and pie in the sky ideas that get started, who knows where keep having to pay and have nothing to show for it in the end, but emptier pockets.
Where does this stop? When will Americans realize that tanstaafl (there ain’t no such thing as a free lunch) doesn’t exist? When will we learn? There was the American auto industry bailout when we wouldn’t stop making the big gas guzzlers’ during the oil crisis of the 1970’s and the savings and loan debacle in the 1980’s, then the tech bubble burst in the 1990’s with help from Enron and companies like them screwing with the finances of every investor, and now the mortgage crisis in the first decade of the 21st century.
Maybe tnmats is right, let everyone who wants to play, pay the piper when the latest money making scheme goes bad. No one gets a break. Just this once. Maybe it will stop. Or am I just being Don Quixote, tilting at the common sense windmills that have stopped turning in this country and I suspect in other parts of the world that we really don’t care about?
- Historian1956
April 4, 2008 at 6:10am
>>In our effort to help deserving homeowners, no assistance should be given to speculators<<
The rub is "deserving homeowner" -- turn on the radio and listen to the flood of ads telling people in credit card debt and who owe money to the IRS how they should settle for pennies on the dollar. It often seems the people whose homes may not be worth the mortgages anymore but who value paying their bills/honoring their commitments/etc., let alone those who made sacrifices in the past to avoid being in this spot (paid higher mortgage rates rather than ARM's, kept renting instead of owning) are being played for chumps.
And Dayo, I think that explains resistance to a new Great Society as much as racism, but I agree with blackton that accountability tied to new initiatives is the way to garner support.
- Lymon1
April 4, 2008 at 6:19am
How does America's Purple People problem diverge into a conversation about homeowner bailouts? I was hoping for a hot debate on which TNR poster would admit to having split personalities first and whether their support for Hillary! No! Obama! No! Hillary! No! Obama! Wait...was I supporting McCain or Rove? Now I'm confused. What was this post about again?
- singlespeed
April 4, 2008 at 10:16am
Glen Beck is odiousness personified. Watching his show is like getting stuck next to a cheerfully ignorant loudmouth on an airplane, and being forced to listen to him laugh at his own stupid jokes and lecture you about how Democrats, Harvard professors, and radical feminists are plotting with the United Nations to bring Communism to America by getting rid of the Second Amendment.
- Androscoggin
April 4, 2008 at 10:26am
Americans tend to be ideologically conservative, and operationally liberal - G. Will.
I'm having a hard time with "deserving homeowners", too. I missed the part about where no one should ever get foreclosed for any reason, and that the value of everyone's home should only go up. Always.
If I were a renter, would I be steamed!
- butchie b
April 4, 2008 at 11:22am
"If I were a renter, would I be steamed!" No, they won't be. Interests on mortgages are deductible, but rent isn't, that far more than a one time handout you would think would make renters angry, but since most renters hope to one day hope to buy a home of their own, they don't get worked up about it. And they won't about this one. And I love this line as it is simply transference. Wealthy people don't want to look like heartless bastards by denying help to the less fortunate than themselves, so attempt to couch their arguments in a way as to claim to be speaking in favor of the even less fortunate, such as renters.. What next? NO, we can't provide heating oil subsidies for the poor, won't the homeless be steamed?
- blackton
April 4, 2008 at 1:46pm
Historian - I hear you, I hear you!
Yes, there's a much deeper problem here that neither Tweedledee nor Tweedledum will talk about: our economy is now based on excessively available consumer credit, aka millions of badly-educated people spending money they don't have on stuff they don't need. Until recently, many of these people were engaged in selling houses to each other, and many of their better-educated peers engage in similarly useless but lucrative arbitage pursuits involving "financial engineering" and other forms of moneyfiddling.
Meanwhile, the private sector since 911 has added ZERO jobs outside of the Fed-manufactured bubble in Construction and Real Estate, the number of native-born American kids choosing careers in real (as opposed to financial) forms of engineering continues to decline, the schools still suck, and both parties do everything in their power to avoid telling Americans to save more, educate their kids better and stop looking for the free lunch.
Here's hoping that the end of this second Greenspan-engineered, liquidity-fuelled asset bubble will focus at least a few American minds on the need to move away from a bread-and-circus economy toward one based on high value-added jobs that pay high wages which translate into more savings. And less consumption of Chinese-made crap.
- teplukhin2you
April 4, 2008 at 2:11pm
Thanks tep. Funny my husband and I are renters and our son is studying civil engineering. We went through the should we buy or continue to rent till we clear some debt question 2 years ago. Looking at the housing market here and in the state where our son goes to school, I realized that the prices were absolutely, ridiculously inflated in both areas and kept putting my foot down. Also this idea of giving a college student a mortgage, which some companies were trying to push on our son, without an income would come back and bite us on the ass, leaving us further indebted without real value.
As you can imagine, I was called every name in the book for being so stupid as to not be able to see how paying an absolute fortune for a tiny condo near the university, or buying a home here that was triple the price it would have been 5 years ago was the next best thing since sliced bread. Quess what, the mortgage crisis hit and I'm no longer hearing how stupid I was. In fact, I'm not hearing too many pie in the sky ideas on how to invest money we don't have for something we don't need right now.
I guess I learned too well at my parents and grandparents knees not to jump into things just because they sounded great. I made what at the time seemed to be 3 extraordinarily expensive mistakes within a 2 year period when I was in my early 20's and learned from them. Now I bargain and am always willing to walk out on a "deal" when I know both in my heart and after doing due diligence that a price is far too high for the object, whether it be a car or home or whatever, to have real value for the money. I also know it is important to have a good chunk of your money liquid and if you have debts, due to unforseen happenstances, such as becoming disabled, as I have been for the past 6 years, that you do eveything you can to offload the debt before incurring new debt. I may not get rich, but then again those folks over at Bear Stearns who took their bonuses in stock or invested far too much of their capital in their accounts, arent' as rich as they used to be either.
- Historian1956
April 4, 2008 at 4:39pm
Blackie, you're just wrong on this. First, renters I know ARE steamed that homeowners get deductions (not just interest, but charity, too) and they don't. And now, even though they did the prudent thing and saved their money for some future home purchase, the people who overextended themselves to buy, took an ARM, etc., now get bailed out because, I guess, when millions of people are stupid, there's power in weakness!
Maybe you're right. But I sure as hell would be!
BTW, I'd be happy to end the mortgage interest deduction tomorrow. Let's see if BHO or the Lioness of Tuzla runs on that one. Transference, my eye.
- butchie b
April 4, 2008 at 4:40pm
butchie, your gardener, landscaper, maid, and various other household help don't count. They have learned long ago to say what will make you happy. I am a renter here, and will be when and if I move back to the states. I can't get steamed over something I am powerless to do anything about. I have no problem with the mortgage deduction. Are you in favor of all of these stupid people becoming homeless? From a purely economic standpoint it would be for the best, help bring housing prices down for those that can make the payments as millions of houses will then become available, but to expect this to happen during an election year, as millions of families move into temporary shelters? Great visual to end the Bush years, failed war, failed economic policies, failed everything.
- blackton
April 6, 2008 at 5:07pm