Do any lobbyist-haters here support the coming bankruptcy bill?

[Rick Lee]

Seems most folks here are vehemently against a federal bailout of subprime borrowers and banks. Now Legion's favorite homestate senator, Dick Durbin, in publicly encouraging distressed homeowners to declare bankruptcy to stall foreclosure proceedings. The WSJ today said part of this bill includes $200 billion (with a B) just for credit counseling. Yeah, that'll fix this. They want to let judges arbitrarily reduce mortgage debt to XX% of home value. Hilarry Clinton has repeatedly said she would "freeze" interest rates for five years, though I doubt that's possible, even if it were legal. Sounds outrageous, eh? How are you gonna stop this Robin Hood giveaway? That's right. Lobbyists. They are the only ones fighting this nonsensical legislation. And they'll be tarred and feathered for it. Obviously, the measures being proposed here will just make mortgages more expensive and difficult to get for responsible people, actually for everyone, while rewarding piss poor decision making. I highly doubt anyone here on PPOT is writing their Congressman to demand they vote against this. That leaves just the banking industry to lead the fight. And we all know they do this by hiring lobbyists.

[frogger]

I'm all for throwing the distressed homeowners in debtor's prison.

[onewhippedpuppy]

$200B for credit counseling? How about we let them lose their house, that would probably teach them a pretty lasting lesson. My best-learned lessons were due to my own stupidity, I've always been good at learning from my mistakes.

[Rick Lee]

Originally Posted by frogger

I'm all for throwing the distressed homeowners in debtor's prison.

Yeah, you'll see a politician utter those words!

[Rick Lee]

Ooops. I made a mistake. It's $200 million for credit counseling but $200 BILLION for other nonsense. Read it and weep...

Bankruptcy Act
February 26, 2008; Page A18

Has Harry Reid realized that the just-enacted $168 billion stimulus plan will do nothing to encourage economic growth? On the same day that President Bush signed the bill, February 13, the Senate Majority Leader introduced Son of Stimulus, with plans for a floor vote today.

For this bill Mr. Reid decided to ignore the normal vetting of committee hearings and markups, and it shows. Democrats laud the $200 million in the bill for credit counseling, but the actual language of the bill directs $200 billion to something called the Neighborhood Reinvestment Corporation. We trust this error will be eliminated before Mr. Reid achieves Guinness fame for creating the world's most expensive typo.

The plan also borrows an idea from House Judiciary Chairman John Conyers to repeal a long-standing provision in bankruptcy law and allow judges to reduce the amount borrowers owe on their homes. Judges can do this now with credit-card debt -- a big reason rates on credit cards are so much higher than those for mortgages.

Allowing judges to rewrite the terms of mortgages is a tough sale even within Mr. Reid's own party. The Congressional Budget Office, whose leadership is appointed by Democrats, warned in January that such a change could result in higher interest rates for homeowners and bigger caseloads in bankruptcy courts. Other nonlibertarians in opposition include 16 House Democrats who sent a letter to Mr. Conyers last fall. They tried to talk him down from the ledge before he forced a December committee vote. And then there's Supreme Court Justice John Paul Stevens, who noted in a 1993 case that the special treatment of mortgages was specifically intended to encourage lending to prospective homeowners.

The bill also allows states to issue an additional $10 billion in bonds to refinance subprime loans and allocates $4 billion to rebuild abandoned and foreclosed properties in the states hardest hit by the housing downturn. This is a taxpayer-funded bailout that no one wants to call a bailout.

Senators just returning from recess might use the few moments they'll have before voting to consider who among their constituents actually benefits from this foray into mortgage finance. The roughly 35 million households currently renting their homes obviously do not. But a new study from Wharton professor Todd Sinai suggests that, even for homeowners, the answer depends on location, location and location.

Examining recent proposals to help mortgage borrowers, Mr. Sinai finds that such "reforms" invariably amount to a subsidy from all Americans to recipients concentrated in a few states, especially California. This is a winning formula in the House, where Speaker Nancy Pelosi can whip 51 of her Golden State colleagues, but a close look at the math may give Senators pause.

Mr. Sinai adjusts for the size of each state market and finds that Californians are more than six times as likely to hold a subprime mortgage as residents of North Dakota. Arizonans are almost five times as likely as Vermonters to be subprime borrowers. If all politics is local -- and make no mistake, this hastily-drafted bill is a political stunt designed to gain Senate seats in November -- Senators might ask how costly Mr. Reid's national solution will be for their constituents. Republicans are right to oppose it.

[legion]

Originally Posted by onewhippedpuppy

$200B for credit counseling? How about we let them lose their house, that would probably teach them a pretty lasting lesson. My best-learned lessons were due to my own stupidity, I've always been good at learning from my mistakes.

You mean a well-remembered lesson that costs nothing in tax dollars?

Surely you jest. Only the government has the power to fix our problems.

(Yeah, and I can't wait until I can vote Durbin out of office. We need at least one senator that isn't solely the property of Cook County.)

[Tobra]

Do our elected representatives have no idea at all regarding economics?

What is proposed will maybe help some people who made bad decisions in the short run, but will punish everyone, even the ones they help in the long run.

[Big Ed]

This type of crap drives me crazy. Let the market run its course...so many of these loans should never have been written.

Why should the people who DIDN'T overborrow bail out those who did? Is there ANY ******* personal responsibility left in our world? Hello?

[Rick Lee]

Originally Posted by Tobra

Do our elected representatives have no idea at all regarding economics?

What is proposed will maybe help some people who made bad decisions in the short run, but will punish everyone, even the ones they help in the long run.

Credit counseling will do nothing for anyone in the short run. I look at it like the classes you take after you get a DUI conviction or mandatory traffic school. At best, it's a reminder to be careful next time. All proposals I've seen from the Dems entail massive wealth redistribution from those who earn and live responsibly to those who do exactly the opposite. Like POP said, stupid people's votes count just as much as smarts people's votes, but are much easier to get.

[Big Ed]

And another thing...how is it a "tragedy" that people who bought a property with no money down, including financed closing costs (like many of these people did) lose the place to foreclosure?

At the very least, they would have freeloaded in the house they weren't paying for for several months until after the foreclosure and subsequent eviction.

And I have no sympathy for the lenders. They made risky business bets and lost. Sucks being them.

[Rick Lee]

Originally Posted by Big Ed

And another thing...how is it a "tragedy" that people who bought a property with no money down, including financed closing costs (like many of these people did) lose the place to foreclosure?

Because politicians like to make home ownership sound like a birthright. Like college, home ownership simply is not for everyone.

[Dantilla]

With our defecit, it's Congress who needs credit counceling.

[Big Ed]

Originally Posted by Rick Lee

Because politicians like to make home ownership sound like a birthright. Like college, home ownership simply is not for everyone.

You know, Danny, the world needs ditch diggers, too.

-- Judge Smails

[Rick Lee]

Both Dantilla and Big Ed, truer words were never spoken.

[HardDrive]

Originally Posted by Big Ed

Is there ANY ******* personal responsibility left in our world? Hello?

No.

And if you are responsible, you end up getting ******* screwed. Your hard earned money gets taken away and given to fuch ups.

[onewhippedpuppy]

So should I rush out and buy a much bigger house? What about a second house?

[Rick Lee]

Originally Posted by onewhippedpuppy

So should I rush out and buy a much bigger house? What about a second house?

Just be sure to not read anything before you sign it, so you'll be able to maintain your victim status when things get bad.

[Porsche-O-Phile]

In all seriousness I'd be FOR bringing back debtor's prisons. It'd go a long way to solving many of this country's messes with one stroke of the pen. Brilliant!

[Rick Lee]

Originally Posted by Porsche-O-Phile

In all seriousness I'd be FOR bringing back debtor's prisons. It'd go a long way to solving many of this country's messes with one stroke of the pen. Brilliant!

You might as well wish for Ron Paul to be president. They're both Walter Mitty fantasies and no politician would ever be caught dead demanding stupid people get what they have coming.

[frogger]

Originally Posted by Porsche-O-Phile

In all seriousness I'd be FOR bringing back debtor's prisons. It'd go a long way to solving many of this country's messes with one stroke of the pen. Brilliant!