N.Y. Times: Obama’s Should Have Bailed Out More Deadbeats

Binyamin Appelbaum can’t prove it, but he’s sure President
Obama’s troubles are a result of not spending enough taxpayer money
on bad borrowers. 

Although his 2,600-word
story New York Times story
“Cautious Moves on
Foreclosures Haunting Obama” presents no evidence to support his
thesis, Appelbaum insists the president could have saved the
economy and ensured his re-election if only he’d been willing to
spend more of the $700 billion Troubled Asset Relief Program and
the $800+ billion American Recovery and Reinvestment Act to give
more home equity to people who don’t pay their mortgages. 

You should pay more taxes so this house can be finished.

Appelbaum’s narrative is a simple one: “After inheriting the
worst economic downturn since the Great Depression, President Obama
poured vast amounts of money [to] revive the economy.” But he
didn’t force banks to give mortgage “cramdowns” to defaulted
borrowers, and he failed to spend more of the “hundreds of billions
of dollars that Congress had allocated to buy mortgage loans, even
as millions of people lost their homes and the economic recovery
stalled somewhere between crisis and prosperity.” As a result, “the
nation’s painfully slow pace of growth is now the primary threat to
Mr. Obama’s bid for a second term” as “Congressional Democrats and
liberal advocacy groups not normally focused on housing, like the
National Council of La Raza,” demand “action to prevent
foreclosures.” 

Another way to make housing go higher. Appelbaum does not question the idea that
“action” would in fact have prevented foreclosures or revived the
economy. He makes a pilgrimage to the headquarters of the
Depression-era Home Owner’s Loan Corporation, which bought about a
fifth of the country’s underwater mortgages in 1933. (The
Depression lasted another 13 years after the agency was created.)
He also notes that Obama’s opponents in 2008, Hillary Clinton and
John McCain, both advocated straight-up government purchases of
non-performing mortgages. That idea at least would have been a more
or less clear waste of money. 

Obama avoided making this outlandish promise in 2008, but as
president he did try

You can read the rest of this article at: http://reason.com/blog/2012/08/22/ny-times-obamas-should-have-bailed-out-m