Republican senator and presidential contender John McCain weighed in yesterday on the economy in general and particularly the housing slump in particular. Most of this speech is standard stump speech material but I took issue with some of his comments, in particular how he characterized the millions of Americans that are facing foreclosure.
"I have always been committed to the principle that it is not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers," McCain said.
It is easy to just right off those individuals and families in trouble as being "irresponsible," but the truth is not that simple. Many were sold a bill of good by their overzealous lenders promising loan programs that were literally too good to be true. I realize that some point, the consumer must exercise due diligence before signing but make no mistake about it: banks go through great trouble fine tuning their message to gloss over the ugly details behind some of their programs. When a crooked bank pressures the appraiser to inflate the value of a home so they can "get the deal done," most homeowners are none the wiser.
Government response to the housing slump must include tighter scrutiny of the lending industry.
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