superchunk -
Here's the problem though: Why should the government prop up failing mortgages? If the government is spending money to ensure that people keep their jobs, and spending money, wouldn't it be better to do such AFTER the market has leveled out, and they can give a clear response?
Think about it this way:
We've come to this point to have this many foreclosures because prices reached a level that were unsustainable. So to alleviate the pressure, foreclosures began to spring up right and left to drive prices down to a reasonable level.
But instead of letting this take place, the government is (yet again) pumping money into a broke machine. The problem with the logic is that if homeowners made bad choices on buying houses at inflated prices, the only reasonable way to deal with this is to....*gasp* let it go! It's the same thing with the car companies - GM and Chrysler make crappy cars. They needed to go bankrupt, and reorganize, rather than have tens of billions of dollars infused into them.
Now, you may say 'but the jobs will have a trickle down effect and hurt everything else!' - And I agree with that. But we should let the restructuring happen first, BEFORE stimulus occurs. You cannot stimulate that which is dead and rotten. You need to spur growth in good areas, not bad.
That's like the government paying me to keep chain smoking so I can keep the healthcare system afloat. It's not an efficient usage of resources.
Back from the dead, I'm afraid.
