Will economic conservatives learn any lessons from this crisis?

Merits and analysis of Obama’s housing plan aside, I’m particularly interested in this bit of Republican rhetoric I’m seeing.

From Politico.com:

The GOP, perhaps predictably, was less enthusiastic. House Republicans released statements, suggesting Obama’s plan rewarded irresponsible borrowers at the expense of the vast majority of homeowners who pay their monthly bills on time.

[…]

He objected most to the main theme of the foreclosure plan – using monetary incentives to spur lenders and borrowers to do the right thing.

“The biggest outrage is that the president’s plan actually will use taxpayer money to pay people to do what they are already supposed to do – pay their mortgage,” Shelby said. “It also uses taxpayer money to pay banks to do what they should already be doing – modifying mortgages.”

So the mass job layoffs aren’t their fault, but people who are struggling to pay their mortgages are “irresponsible” and aren’t “doing what they’re supposed to do” by paying their bills–in other words, their non-payment is “their fault”? I guess in their perspective, you ought to be able to pay your bills with or without a job!

The Republicans seem willing to say that the economic downturn (and thus layoffs, increased credit card rates, and lower lines of credit) is beyond people’s control, but the impact of the economic downturn (housing foreclosures) somehow isn’t.

Their rhetoric also removes any blame for the abusiveness of the mortgage industry on the industry and solely in the hands of “irresponsible” Americans.

I also find it interesting that they claim that this is what the mortgage industry should be doing anyway, yet they don’t want any regulation making them do it and in the absence of such regulation, don’t want the government to incentivize good behavior they “ought to” be doing anyway? If it’s less advantageous to them financially, why on earth would they do it? Since when did the financial industry grow a conscience?

These statements are fascinating to me as well, because I have been wondering myself if our current economic crisis might change the way we think about, talk about, and approach public policy regarding the unemployed and working poor. (more…)

Published in: on February 19, 2009 at 2:15 pm  Comments (1)  

Bush, Big 3: Nope, you can’t pin this on the ‘little guy’

Friday Bush announced that some of the TARP funds intended for the financial industry will be used as a temporary lifeline to the Big 3 auto makers, after the Senate failed to pass the auto bailout bill last week.

From The New York Times:

The plan pumps $13.4 billion by mid-January into the companies from the fund that Congress authorized to rescue the financial industry. But the two companies have until March 31 to produce a plan for long-term profitability, including concessions from unions, creditors, suppliers and dealers. (emphasis mine)

The funding is on the condition that the union workers’ wages be reduced to the level of non-unionized workers at foreign auto plants. Now I’ve written this before, but I’m going to say it again: there were no such stipulations given to the financial industry bailout. I’m not opposed to restrictions and conditions, but the white collar/blue collar double standard in juxtaposing the two bailouts is astounding. (more…)

Published in: on December 20, 2008 at 12:47 am  Leave a Comment