Today, i ran into one of my LEAST favorite arguments concerning the current Recession.
"if it hadn't been for Barney Frank, and the Dems, pushing sub Prime house loans, we wouldn't be in this situation." with the UNSPOKEN blame falling on poor families who tried to buy a house, and fell behind, either because of OTHER bills, or loss of work, or (most frequently) shady business dealings by the lender... IE variable rate mortgages, which jumped to 2,3 4 times the original amount after a year... so the banks could make their money, then repossess the house, and sell it again...
Well, there are MANY problems I have with this argument. however I will not cover them all. Right now, i just want to point out a few.
Firstly, the LENDERS were gaming the system, KNOWINGLY.... knowing they would get bailed out...
Secondly, the Banks and mortgage houses had a policy FROM THE TOP DOWN to make as much money in the short term as possible, no matter WHAT the cost to the economy...
However, the MOST important point I want to make is simple... no matter WHAT the Media has said, it WASN'T the poor/lower middle class home-buyer that was the MAIN problem.
lets think back like 5/10 years, and think about ALL the TV shows about "Flip this house"
a 'get rich quick scheme, where you buy a house, invest 10k in new rugs, new floors, maybe a new bathroom, then SELL it for 60k more than you bought it for...
THAT was the rage in the early part of this century.
And people DID it... they bought a property and mortgaged it to do repairs, then took out a second mortgage to buy ANOTHER property... mortgage THAT one... repair, rent, second, third mortgage for a few more...
Until there were 5 or 10 or 15 properties, all tied into each other... So when ONE property couldnt be rented, and the bill came due, maybe for a month the owner could float it... shuffle things around... max out a credit card or two...
then came the REAL costs of ownership... repairs... mold, busted pipes, backed up toilet, missing shingles, flooding... THEN the COST of being a property owner came due... and MANY owners were beyond their limit of what they could pay out of pocket... so either more mortgages, or default were their options... they TRIED to game the system as long as they could but then one and 2 and 4 and 12 defaulted... which made it HARDER for a family in a house to refinance, or cut a deal... and the WHOLE HOUSE OF CARDS collapsed... which was exacerbated by the amount of shuffling, trading, repackaging, ETC that the BANKS did...
I often use the metaphor of a chair to describe the 'economic collapse'. It IS NOT a perfect metaphor, however it does work. In my metaphor, the poor family is merely a support arm... sub prime loans are ONE leg, bank re-bundling financial instruments, shuffling of debt are a second leg... Shady economic choices and a debt ridden national policy, which puts NO ONE to work is the third... and the last is greed...
plain and simple greed...IT WAS GREED THAT PUT US HERE... both at the highest and lowest levels of society. Greed and Envy... Envy is the fuel that feeds the fire of greed...one family, one person looks over at his neighbor, who has a similar job, but perhaps had less college debt to start off with,. or fewer children, or made a lucky investment... WHATEVER it is.... one person looks at another, of the SAME BASIC CLASS and says to herself "why don't 'I' have 'THAT'.... then greed and envy rear their ugly heads... and people look to even the score... 'keep up with the joneses'...
hence, we come here.... to a society of the WORST, impulses of humans, where there is LITTLE empathy, no heart, no soul... just 'get what you can while you can get it"
Frankly, THAT is NOT the America I was raised to believe in...
how about you?
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