It’s another case of your government working for you, instead of you working for yourself.
After the Federal Reserve engineered a plan for JPMorgan Chase (NYSE: JPM) to take over ailing investment bank Bear Stearns (NYSE: BSC), the April 2 “CBS Evening News” suggested the government should do the same for faltering homeowners.
“Now to the foreclosure crisis that has so many Americans worried about losing their homes,” “Evening News” anchor Katie Couric said. “After the government helped rescue Bear Stearns, calls grew louder for Washington to help struggling homeowners as well. Today on Capitol Hill, there was at least the promise of some assistance.”
Details of the taxpayer-funded plan agreed to by the Senate Banking Committee still need to be hammered out, but the cost of the plan will run in the hundreds of billions. CBS correspondent Wyatt Andrews detailed some of the aspects of the plan.
“With thousands of homes still going into foreclosure every day, the Senate has decided to act, piecing together a mortgage aid package to help stabilize the decline in the value of homes,” Andrews said. “With details of the package still to come, states would get $10 billion to help refinance subprime mortgages. Localities would get $4 billion to buy homes in foreclosure. The biggest idea for home buyers is a $7,000 tax credit for anyone buying a new home, a home in default, or a home in foreclosure.”
That was an inadequate response for some. Peter Morici, a chronic advocate of government intervention and a frequent CBS News contributor, said the proposal wasn’t enough.
“One shouldn't view it as a silver bullet,” Morici said. “As they see the need to stop the decline in housing prices, and they also need to do political damage control.”
Even though there is agreement on both sides of the aisle on the Senate Banking Committee on this housing legislation, House Speaker Nancy Pelosi (D-Calif.) isn’t going to give the bill a free pass in the House, according to the April 3 Politico.
“The Senate came together in a bipartisan way and gave a signal that Congress is prepared to act,” Pelosi said, according to Politico. “There are some improvements that certainly need to be made. …Hopefully the balance will swing to be more in favor of those families who are in danger of losing their homes."
CBS also quoted liberal Democratic Rep. Carolyn Maloney (N.Y.), who parroted the Wall Street/Main Street comparison the media and the Democratic presidential candidates have trotted out the last several months.
“Wall Street has been helped, now it’s time to help Main Street,” Maloney said.
No Congressional Republicans or economists with a more laissez-faire view of government policy and economics were included in the “Evening News” segment.