Free Markets, Free People

HAMP

Harry Reid and the drive to preserve the big government “status quo”

Who are the reactionaries and who are the revolutionaries (progressives?) now?  Senate minority leader Harry Reid sure sounds like the reactionary:

At a Capitol Hill Press conference to announce that the Senate had agreed to a continuing resolution that will keep the government funded through March 18th, Reid was asked about GOP plans to eliminate the Home Affordable Modification Program–a program that has permanently modified nearly 600,000 loans since its inception.

“Why can’t they work on things that help the economy?” Reid asked. “Why do they have to work on things that hurt the economy? Why would they want to eliminate a program like that? Just because it came from the White House? This is hard for me to understand why they’re so fixated on destroying our government, our economy.”

What he’s talking about is the Home Affordable Mortgage Program or HAMP.  Earth to Reid — we can’t afford stuff like that anymore … not that we ever could.  And besides, it isn’t a function of government.

But Reid is convinced, as are many of his colleagues, that it is the job of government to redistribute wealth and use other people’s money to rescue those who’ve gotten themselves into a financial bind (through no fault of the “other people”).  And, of course, there’s this:

The Treasury Department had set aside $75 billion for the program,the administration promised would prevent 3-4 million foreclosures by helping people modify the terms of their loans. As of December 521,000 mortgages had been modified. That an abysmal record. But worse still is the fact that some money from HAMP has been diverted to other housing programs that are doing an even worse job of helping people stay in their homes.

"About $8.1 billion was set aside to enable certain borrowers who are current on their mortgage to refinance into Federal Housing Administration loans if their homes are worth less than what is owed on the mortgage. About 44 loans have been closed under that program." Did you get that? HAMP was poorly designed in that it was supposed to subsidize those who were delinquent on their mortgage payments, but at least some money was diverted to "help" those who were actually paying their way.

Another in  a long line of wasteful programs modified on the fly to do things not approved originally.  And that may be some sort of record – $8.1 billion and only closed 44 loans?  If you think “created or saved jobs” cost a lot, do that math.    It wasn’t the only diversion from the original program:

Another $7.6 billion was reallocated to emergency mortgage relief payments to unemployed workers in some states. The other program targeted by Republicans helps communities buy and redevelop foreclosed properties.

And there’s more.  Says an expert:

Julia Gordon, senior policy counsel at the Center for Responsible Lending, said killing the entire lineup of foreclosure prevention when tens of thousands of homes are lapsing into foreclosure each month makes no sense. "If something is not working well enough, you fix it," Gordon said. "You don’t just toss it out."

How about if something isn’t working well at all and it costs money you can’t afford Ms. Gordon?  What if it isn’t something government should be involved in – at least by the Constitution most of us were taught in school?  That’s one of our problems, Ms. Gordon – we create these wasteful bureaucratic programs and never kill them off when they’re found to be useless or costing far more than anticipated.   It is time to kill this turkey.

A $75 billion dollar boondoggle that should be cut and all we get from the reactionary Democrats and “experts” with a vested interest in continuing the farce is a fact free emotion laden argument about hurting the economy and destroying government?

Get a grip Mr. Reid.

~McQ

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