.....Carrying a Five-Gallon Can of Gasoline and a Lighted Match. He screams to the gathering crowd, “Quick! Quick! The barn is on fire! Everybody, quick! Give me all of your money so that I can go buy some water to put it out!”
Somebody Steps Forward and Asks, “But it's a fireproof barn. How can this be happening?”
The Man Shouts Backs, “Will nobody listen to reason? There's no time to waste! Hurry! Hurry! We've no time for mistakes!”
Someone Else Asks, “How about if we all bring our hoses and buckets out and put out the fire ourselves?”
“No, No, No!” Screams the Man. “I want to buy all your hoses and buckets. Then everybody turn around, and I'll put out the fire. But hurry! There's no time to waste!”
“But Why Should We Give You All Our Money, to buy our hoses and our buckets from us, so that you can go put out the fire......that you just started?”
Don't You Wish That All Analogies Were Better Than This One? The details don't match the current economic crisis facing the United States. And certainly neither Treasury Secretary Henry Paulson nor Federal Reserve Chairman Ben Bernanke created this "barn fire."
It Was “Free-Market” Ideology that failed in this situation. According to Republican testimony, the only way that Freddie Mac and Fannie Mae could get mortgages to poor people was to get rid of regulations that governed mortgages, and then sell to poor people mortgages that they could not afford.
Plenty of Ways Exist to Make Mortgages Available to low-income borrowers. But we took advantage of ignorance and greed, and put the entire American economy at risk.
As Chairman Bernanke Himself Has Not Said, “The American barn is on fire.” And we know who lit the match.
So Now What Do We Do?
What If We Guaranteed Troubled Mortgages by taking a shared equity position and extending the mortgage payments to compensate the Treasury's contribution? What could be simpler, and fairer both to the troubled homeowner and the underwriting American taxpayers?
Meanwhile, Back at the Burning Barn, government representatives of the folks that set the thing on fire are still out there, shouting:
“Hurry, Hurry, Hurry, Before the Barn Burns to the Ground, and There Is Nothing Left for Us to Sell.”
Somebody Steps Forward and Asks, “But it's a fireproof barn. How can this be happening?”
The Man Shouts Backs, “Will nobody listen to reason? There's no time to waste! Hurry! Hurry! We've no time for mistakes!”
Someone Else Asks, “How about if we all bring our hoses and buckets out and put out the fire ourselves?”
“No, No, No!” Screams the Man. “I want to buy all your hoses and buckets. Then everybody turn around, and I'll put out the fire. But hurry! There's no time to waste!”
“But Why Should We Give You All Our Money, to buy our hoses and our buckets from us, so that you can go put out the fire......that you just started?”
Don't You Wish That All Analogies Were Better Than This One? The details don't match the current economic crisis facing the United States. And certainly neither Treasury Secretary Henry Paulson nor Federal Reserve Chairman Ben Bernanke created this "barn fire."
It Was “Free-Market” Ideology that failed in this situation. According to Republican testimony, the only way that Freddie Mac and Fannie Mae could get mortgages to poor people was to get rid of regulations that governed mortgages, and then sell to poor people mortgages that they could not afford.
Plenty of Ways Exist to Make Mortgages Available to low-income borrowers. But we took advantage of ignorance and greed, and put the entire American economy at risk.
As Chairman Bernanke Himself Has Not Said, “The American barn is on fire.” And we know who lit the match.
So Now What Do We Do?
What If We Guaranteed Troubled Mortgages by taking a shared equity position and extending the mortgage payments to compensate the Treasury's contribution? What could be simpler, and fairer both to the troubled homeowner and the underwriting American taxpayers?
Meanwhile, Back at the Burning Barn, government representatives of the folks that set the thing on fire are still out there, shouting:
“Hurry, Hurry, Hurry, Before the Barn Burns to the Ground, and There Is Nothing Left for Us to Sell.”
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