There are a lot of people who are having trouble paying their mortgages these days. These are people who, in the last few years, over-borrowed to buy bigger homes because interest rates were low. The so-called “sub-prime” mortgage lending business saw a huge boom as a result, and now that interest rates are climbing again, the people with adjustable rate mortgages or balloon ARMs or whatever other creative things were invented are suddenly in a world of financial trouble.

The answer? Naturally there are people in the government who want to bail out these people. They advocate paying money to help support those who can’t meet their mortgage, and also requiring banks and lenders to foot part of the bill. Here’s a quote from an AP article:

Consumer advocate groups say those loans, with steeply rising payments, were pushed on borrowers who didn’t understand the terms. Advocates say a government bailout, even a large one, is appropriate because regulators didn’t do enough to stop predatory lending, and because of the high cost of foreclosures.

So, just to be sure it’s clear what’s happening here, the government is using my tax dollars (and yours) to give money to people who made poor financial decisions. These borrowers “didn’t understand” what they were doing, and the lenders were “predatory” and evil by “pushing” their loans on people.

The last time I checked, no one is ever forced to get a mortgage and buy a house… especially one with bad terms, or a house that’s perhaps a bit too large or expensive for the income of the buyer. But forget logic and forget what’s fair– apparently people who are too dumb to read the terms of their mortgage deserve a government bailout. And the price tag for this is estimated to climb to $120 billion dollars or more. Ouch.

I think the most appropriate quote was from Michael Englund, an economist:

If the plan is to pay off loans when people quit, then I plan to quit paying my loan.

The financial irresponsibility of our government is staggering.