Tuesday, September 23, 2008
Christmas In September …
In the dark of night over the weekend when most people were snoozing, the Treasury dramatically expanded its bailout plan to include buying student loans, car loans, credit card debt and any other “troubled” assets held by banks.
As to the actual meat of the bailout itself I am nominally in favor of it, sure I was outraged at the time - who wouldn’t be? - but after thinking about it for a few days I calmed down; the government after all created the underlying problem by forcing financial institutions to loan people money for houses, houses they could ill afford, and now well ... we’re reaping what was sown back in the late 1970’s and again plowed up in the late 90’s. Megan McCardle has been blogging about this extensively over the past few days, so hit her site and just keep scrolling if you want the reasons behind why I changed my mind.
That said, what the Treasury is planning to do now? Let’s see ... how can I put this? OH. BUT. HELL. NO.
Stick with the actual meat of the bailout, buying up all the bad home loans that are at the root of this mess. As for any other kind of debt that banks maybe carrying? They can just screw off.
Comments
student loans
This one isn’t so much a big deal right now because the feds have already been doing it. Why do you think people who default on non-government student loans eventually get contacted by the US Dept of Ed? It’s because Ed. buys the defaulted loan and then uses the federal powers to attach people’s tax returns, garnish wages (where allowable), etc.
As for the rest, I agree completely.
I should add that I’m not happy that the Dept of Ed buys up bad student loans, but I can accept it in this proposal because they are already doing it and have been for years.
I should have made that more clear I guess. And since Jason already explained it, I don’t have to 
.
John Derbershire had a great explanation on Derb radio at National Review. It had to do a lot with companies being forced by government to ignore statistic that certain racial group have a history of being bad credit risk. Of course 1 candidate has an ad pushing for income parity based on gender which is the same nonsense.
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