To be on the N.Y. Times editorial board you don't really have to have any knowledge of the issues on which you opine. This is best illustrated in their drumbeat for "stopping foreclosures." I could try to make the argument against them myself, as I have written many diaries here about the consequences of these attempts, but I will write this diary as a dialog between the editorial and an article, both in today's paper.
And I will add my commentary when necessary.
Here's the Editorial
The unfortunate reality is that as long as millions of Americans continue to default on their mortgages and housing prices continue to slide, banks will continue to suffer big losses. Unless something is done quickly to help American homeowners avoid foreclosure and stay in their homes, those losses could swamp the bailout effort by exceeding the sums being spent to rescue the banks.
The response is in this articleby David Leonhardt
But before any of the various rescue plans reaches the point of inevitability — and these days, ideas can go from unlikely to inevitable in about 48 hours — I think it’s important to stop for a moment and consider how complicated any such plan would be. Every one of them, in fact, faces an inherent conflict: coming up with a large-scale homeowner bailout without also helping millions of people who don’t need help is almost impossible.
And then Leonhardt makes this statement:
That’s a big reason that the various efforts to stem foreclosures so far, both from the Bush administration and Congressional Democrats, have been so modest. You just can’t solve the foreclosure problem without causing a lot of collateral damage — in the form of lavishing money on homeowners who can stay in their homes without assistance.
And it’s not at all clear why such people should be at the front of the line for government help. Why are they more deserving than, say, the growing number of unemployed, many of whom rent their homes?
Now here Leonhardt is so wrong that he overtly states what the editorial only implies:
Let’s start by acknowledging that morality cannot be the main criteria, unfortunately.
The government has already passed the point of drawing fine moral distinctions and is now in the business of stabilizing the economy by whatever means necessary. Someone might argue, then, for rescuing everyone who might end up in foreclosure, regardless of the reason.
He thinks he can ignore morality, that it will be accepted that a renter who is being evicted will continue to pay his taxes knowing that it is going to keep a homeowner in a house that he didn't buy because he couldn't afford it.
No, The Times's editorial Staff, and Mr. Leonhardt are wrong. There is a point of immortality, when good people will simply say screw it all. If someone can take out a mortgage, not pay it, and have taxpayers forced to pay to keep them in their homes, I just won't play this game any more.
Foreclosure is what happens when you make a bad bet on a house. Losing your investment is what happens when a company you hoped would be the new Microsoft goes broke. People lose in a free market, and that's what we have in this country.
I have defended the N.Y. Times many times. I have had a dozen letters published in the old days, and I feel a part of it. But this ignorance, this misplaced sympathy, is just too much.
Perhaps the Editorial Board will read their own paper and become a bit more informed. They sure as hell haven't listened to me.