Bush: No Bailout for Pinched Homeowners

[seafan]

Bush: No Bailout for Pinched Homeowners

By JEANNINE AVERSA, AP Economics Writer
August 9, 2007

President Bush said Thursday concern should be shown those who've lost their homes but it's not the federal government's job to bail them out.
"Obviously anybody who loses their home is somebody with whom we must show an enormous empathy," Bush said. Asked whether he would champion a government bailout, Bush responded: "If you mean direct grants to homeowners, the answer would be `No, I don't support that.'"

New home foreclosures have climbed to record highs. Homeowners with poor credit have been hardest hit as higher interest rates and weak home prices have made it impossible or difficult for them to keep up with their home loans.

In a wide-ranging news conference at the White House, the president also said that he's interested in exploring the possibility of providing tax relief to U.S. corporations. He has acknowledged that such a move would face challenges in the Democratic-controlled Congress, and he insisted it needed to be structured in a way as to not worsen the government's balance sheets.

.....

A Treasury Department study, released earlier this year, showed the federal corporate tax rate could be cut from 35 percent to 27 percent with the same amount of revenue collected if a number of corporate tax breaks were eliminated, thereby broadening the tax base.
However, such a move would likely trigger a firestorm of protest as various groups would seek to protect popular tax breaks such as the research and development credit.

"What we'd really be talking about is a simplification of a very complex tax code that might be able to lower rates," the president explained. "However, I would readily concede to you that this is a difficult issue."

Bush said that the reason there are tax preferences is because "there are powerful interests that have worked to get the preference in the code."

.....

Bush said that he does support financial institutions working with distressed homeowners. He also suggested that some people may not have fully understood the terms of their mortgages. The government, he said, can help out by educating prospective home buyers.

[phantom power]

1. Yes, direct bailouts are only for corporations.

[Elspeth]

15. Exactly. We pay the taxes to bail out corporations but we can't use tax money to bail out ourselves

And some people believe there ISN'T a class war?

[Bitwit1234]

28. And airlines, you forgot that one.

[wordpix]

43. airlines are corporations, too

[Book Lover]

2. Yeah, but $300 a few years ago was just the right way to "celebrate" your installation, wasn't it?

n/t

[Katherine Brengle]

3. If a bunch of corporate fuckbags hadn't decided to loan irresponsibly,

none of this would be happening.

[Demit]

13. There are always going to be people who don't understand "Buyer Beware."

I agree that there should be some regulation in place, but I am having trouble feeling a lot of sympathy for people who don't read the terms of their contracts, or who bought too much house with too little down. But you can't regulate this problem away. There are always going to be shady people out there ready to separate you from your money. You have to run your own numbers and make sure they work.

[Katherine Brengle]

16. I can agree with that - I've argued in the past that

financial planning and budgeting etc should be required courses in all 4 years of high school, for the very reason that most people don't have a clue about this stuff and most parents don't teach it to their kids.

[KaptBunnyPants]

36. Well, they're so dumb I guess they deserve it.

What a compassionate progressive.

[Demit]

57. Just a commonsensical one.

[C_U_L8R]

4. oh but bailing out the banks is okay ????!!!!!!!!!

Where's Neil?

[BlackVelvet04]

5. I have a question....

mortgage companies are raising rates that then cause them to have to foreclose on those who can't afford the new interest rates, thus the mortgage companies stand to lose money, correct? Wouldn't it make more sense to lower the rates or can they not do that because the mortgage companies are paying higher interest rates? Still, foreclosures lose money so what's the difference? I admit I don't understand all of this crap.

[DemocratSinceBirth]

11. All This Stuff Is Arcane

But keep in mind a mortgage company or bank doesn't want to forclose on your home anymore than you want it to be foreclosed upon; especially if you owe more than what's it worth... It's a lose-lose for everybody but the speculator/vulture who gets a home at fire sale rates...

What a sad, sad mess...

[YellowRubberDuckie]

42. The problem is people don't read their mortgages and notes when they sign them...

I deal with this stuff everyday. There are a lot of people who are just too stupid to breathe, let alone own a house.
Duckie

[tammywammy]

51. Indeed

I agree completely: "There are a lot of people who are just too stupid to breathe, let alone own a house."

[Vincardog]

6. HEre is a simple idea. Charge the Corporations a flat 20% tax on sales. Just like an income tax

for corporations instead of individuals. No exceptions or exemptions except that their sales could be reduced dollar for dollar by salaries paid to hourly (Non-Management) employees.

This would not be a sales tax that is passed on to consumers but a tax on sales paid by the corporations. Make it the alternative minimum tax on corporations.

[radfringe]

7. remember what he said at a fund raiser

paraphrased: you are the have and the have mores, but I like to think of you as my base

us little folk ain't his base or his bank book so he doesn't give a flying fuck

[Nostradammit]

8. "With whom we must show an enormous empathy,"

How about we FEEL an enormous empathy there, George.

[hatrack]

34. Nice catch!

Very revealing - not that he exactly shrouds his true thoughts in clouds of mystery . . .

[SammyWinstonJack]

38. One can't feel what one doesn't have and george doesn't have empathy for us little people.

He's no FDR.

[wordpix]

44. "according to my handlers, that is"

[old guy]

9. Can you say "Savings and Loan scandal"? I knew you could.

[Hydra]

10. K&R

What a surprise! *'s base screw up the economy again, and the first thing out of his mouth is:

We need tax cuts! Screw the little guy!

[JVS]

12. Holy shit! Bush is actually telling the truth about something

Bush said that the reason there are tax preferences is because "there are powerful interests that have worked to get the preference in the code."

:wow:

[wordpix]

45. I caught that, too===one of his first ever truths told publicly

[earthboundmisfit]

14. "Tax relief for U.S. Corporations"???

With shelters, offshore accounts, all manner of other evasions, how many of them actually pay taxes NOW?

[CoffeeCat]

17. I will say it now! This is deliberate!!!!

I don't know what is going on, but what has happened to borrowers is BY DESIGN.

For years, bank regulations were relaxed and banks were permitted to give loans
to people who could not afford the payments, and who had no business buying these
expensive homes.

Banks were allowed to gin up "creative financing" like interest-only loans and
3-2-1 buy downs---that gave buyers the illusion that they could afford a $500,000
home on $60,000 household income. The banks knew the people were getting screwed.
The banks knew that once those loan payments moved out of interest-only status--and
people had to start paying on the principal--that the buyers would be in dire straights.

When we purchased our home, we were encouraged to spend more and borrow more. We were also
paying $1,400 per month on my student loan---in order to pay it off soon. The lender
actually told us to roll that loan balance on top of our mortgage to get rid of that high payment
and make us eligible to borrow money for more house. Can you believe that??? We were being
responsible, by aggressively paying the college debt. Ms Banker thought it was a good idea to put
the student loan in the mortgage, which would have been at a higher interest rate than the
college loan--and left us paying it off for 30 years!!!!

Malarky like this went on for a long, long time. I can only imagine the ginormous mountain
of bad financial information people rec'd from these bastards.

Now, when people can't pay---the government says "too bad". It's loose government regulation
that enabled these banks to give homeowners the rope that is now hanging them.

I'm sorry...but this does not happen by accident! This is designed to destroy us! Banks and
mortgage companies made a killing this past decade. NOw, they'll just obtain the foreclosed
homes and sell them to someone else.

Many in American walked into a trap---designed to obliterate the middle and upper-middle classes
in this country. This is not an accident.

[onethatcares]

21. I agree and where better to obliterate than the housing market

they'll always be those that can afford to buy, but the lower income earners will be shut out of the owner market forever.

[KT2000]

26. I think you're right

The house of cards was built with the loans they pushed - the bigger the better.
The loans were likely sold and resold to fund all kinds of venture capitalist transactions.
This short-term thinking was all about quick bucks for the large investors. Wealth was concentrated.
The middle and lower classes exist to feed the wealthy and Chimpy expressed this for those who had any doubt.
Just my opinion on the matter

[On the Road]

29. How is It Deliberate?

Maybe shortsighted or greedy. But why would financial institutions willingly create conditions that would put them into bankrputcy?

[Subdivisions]

33. Because by the time they go bankrupt, they're filthy rich on

my money and yours. Then they simply open another bank.

[KittyWampus]

37. Ribofunk, there's the age-old truth of capitalist economies... Banks are "Too Big To Fail"

they may go bankrupt but our tax dollars WILL be used to bail them out.

Because they are too big to fail.

[On the Road]

59. The Issue Was Not a Bailout, But The Claim That

"what has happened to borrowers is BY DESIGN" and "...these things do not happen by accident."

The type of design was not specified, but since it was a blanket statement, it would seem to be a federal matter. I have a difficult time imagining that Greenspan and Bernanke have been plotting for millions of mortgage holders to get foreclosed on. It makes more sense to believe that they have been guilty of allowing the finance industry to operate unchecked and become greedy and reckless.

[stillcool]

30. By design...

it's not like they don't have any practice.

[Subdivisions]

31. A systematic sucking of all the liquidity out of the middle and lower

classes. This is a classic Class war being waged against the elite agains the peasant classes. They win because they started with all the good cards.

[wordpix]

47. the "trap" is preying on the naive & uninformed. I can't afford a $400,00 fixer upper here in CT,

but my realtor will be happy to help me find one. She benefits via the sales commission if I take the bait. Is that deliberately screwing me? No, but it isn't telling me the whole story about the subprime default mess and how it could impact the market. I had to read up on that myself. Thank you, DU!

After looking at many of these "gems in the rough" houses, I told her I'd wait for prices to come down or just stay put.

[seafan]

18. This, from the Empathy pResident:

"You work three jobs? … Uniquely American, isn't it? I mean, that is fantastic that you're doing that." —President George W. Bush, to a divorced mother of three, Omaha, Nebraska, Feb. 4, 2005

In an unrelated photo:

[AlCzervik]

19. "Pinched homeowners" aren't "His base" big corporations are and lookee--free money for them!

[notadmblnd]

20. That last sentence kinda say it all, doesn't it?

screw the people. After all they're stupid, they deserve what they get. Cause after all,it isn't like anyone ever bailed you out. Right George?

[seafan]

25. Similar to his saying, *take classes at community colleges* to jobless engineers.

Yeah, he's a real warm and fuzzy kind of war criminal.

[Poll_Blind]

22. Two more recs....c'mon people! n/t

PB

[wicket]

23. 1 more to go

n/t

[Poll_Blind]

24. Thank you! n/t

PB

[npincus]

27. from the man who's been bailed out of every failure in his life

except for EYE-raq.

[wordpix]

48. good analysis

[quiet.american]

32. Wow, I'm really surprised and disappointed at Bush's view on this.

:sarcasm:

[wicket]

35. Let's see: Savings & Loans bailout under his Poppy, and now this subprime mess

:wow:

[calimary]

39. Oh yeah, SURE. Like I REALLY want business/investment advice from this guy.

Mr. THREE-BANKRUPTCIES-IN-A-ROW?

I wonder how many of 'em voted for him and his pie-in-the-sky promises, only to hear him tell them - "Sorry. Tough luck. Then's the breaks. Vote republi-CON. 9/11. Have a nice day."

[Poll_Blind]

40. kick! n/t

PB

[Raksha]

41. The POS just added insult to injury by using the word "empathy."

He doesn't know what that word means because he's incapable of it.

[Megahurtz]

46. Wow. I am floored.

:wow:

[moondust]

49. But he'd really like to thank them

for taking advantage of his low, low interest rates to buy up all those expensive houses and prop up his economy for several years!

[Karenina]

50. Wanna hearty laff?

Check out Carlyle investments in the RE sector 02 to 05. They're also poised to "privatize" infrastructure. All available monetary resources are earmarked to bail out the hedgers and murder folks a half a world away until they all are dead or agree to turn over control of their natural resources. What an "interesting" world we live in...

[Olney Blue]

52. The handwriting has been on the wall for some time about this looming

crisis.


"Now, watch this drive."

[David Zephyr]

53. "The Ownership Society"..."Compassionate Conservatism" What a jackass!

His mother instilled his sense of "fairness" in him.

[SeattleGirl]

54. Oh, fuck you, ChimpAss! Just. Fuck. You.

You're about as compassionate as a serial killer.

[Lone_Star_Dem]

55. I know a 34 year old man with three children that just joined the Army

Why? He was losing his house and needed the bonus to keep a roof over the kids heads.

He says it's a temporary fix at best, but he didn't know what else to do.

I bet bush would dance with glee if he knew.

[defendandprotect]

56. From the most "bailed out" family in American history -- !!!!!

[tbyg52]

58. I wonder what percentage of the tens of billions they dumped in to keep the money flowing around

it would take to buy down the rates of the homeowners who have had their ARMs explode on them. Not much, I bet.

Better yet, the banks themselves should lower the rates in the cases where that makes the difference in keeping your home or not.

Like that'll happen....