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That Housing Bailout Plan Gets Filled In
The Treasury Department has released more details about that housing bailout plan. Still waiting for some of the Washington lobbies to weigh in on it. My colleague, Elana Schor, has interesting reporting on the fight over "cramdowns"--giving bankruptcy judges the power to rewrite mortgage terms. Would be curious to know if readers are hearing about other fights over the proposal. It feels like the Rick Santelli moment has not yet passed. This Wall Street Journal poll shows a lot of public doubt about the plan.
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Josh
Matt
Eric
Brian
From the WSJ poll:
"A similar trend emerged with the plan to help homeowners refinance their mortgages and avoid foreclosure. The majority – 68% — said they supported the plan while only 25% opposed it. People were less certain about the plan’s fairness, though.
While 36% said it was fair and would help people caught up my poor economic conditions, more – 48% — said it unfairly benefited those who were fiscally irresponsible."
You interpret a 68% approval rating as "a lot of public doubt about the plan".
I interpret it as approval of the plan but frustration over how we got to this point. Just like most approve of the overall stimulus plan, but hate the fact that the Bushies put us in the position.
On the housing crisis, I think banks deserve more of the blame than home buyers for creating lax credit standards and abusive loan programs for the sake of turning short term profits. Anybody should stay within their means, but when a banker tells you you can have a home with no downpayment, when they're supposed to be the financial experts, then they deserve to share in the losses.
March 4, 2009 2:02 PM | Reply | Permalink
Oh jeez, I just had the same complaint you did regarding "a lot" but hit enter .0009 of a second after you so you win.
March 4, 2009 2:04 PM | Reply | Permalink
I win the internets! :)
March 4, 2009 2:07 PM | Reply | Permalink
I'm not surprised. A banking lobbyist I know stated the rewriting of mortgages was a bad idea and tried to explain why it should only exist on second, third, etc homes but not on primary residence. I then proceeded to play the violin between my forefinger and thumb.
And umm...
"This Wall Street Journal poll shows a lot of public doubt about the plan. "
Is your "a lot" a majority?
I'd say all those polls show "a lot" support the plan.
Taken directly from the WSJ poll.
"A similar trend emerged with the plan to help homeowners refinance their mortgages and avoid foreclosure. The majority – 68% — said they supported the plan while only 25% opposed it. People were less certain about the plan’s fairness, though."
68% sound "a lot" more like "a lot" than 25% does.
March 4, 2009 2:03 PM | Reply | Permalink
How many of those who were polled had read the bailout plan? How many of those that were polled understand the subtext of the mortgage crisis?
68% sounds like support I can believe in.
I think many Americans are worried about investors who have spec homes, who might be bailed out for unltimately driving up the prices when the market was hot and looking for handouts now that the market has crashed. I really fail to see why people would be against additional measures by this administration to shore up the housing market when article after article for at least the last 5 months have been asking for relief for all the foreclosures.
March 4, 2009 2:21 PM | Reply | Permalink
"I think many Americans are worried about investors who have spec homes, who might be bailed out for unltimately driving up the prices when the market was hot and looking for handouts now that the market has crashed."
I think that's true. The house flippers aren't seen as regular Joes and Janes who got caught up in this mess - they are seen as greedy speculators. And in many cases they are. However, to your point about how people actually know the details of the plan - in the guidelines released today, I read that in order to participate in this program, the house in question has to be owner occupied. That often isn't the case when it comes to flippers/speculators.
March 4, 2009 2:51 PM | Reply | Permalink
Does the plan help with primary residences or all the homes that you own? I'm not clear on this.
March 4, 2009 4:27 PM | Reply | Permalink
The plan only helps if the home getting the modification is your primary residency.
March 4, 2009 5:04 PM | Reply | Permalink
Matt - I don't think 68% support is a signal that there is "a lot of public doubt about the plan". Yes, a plurality believes that the plan will benefit some people who were irresponsible. I actually take that as a signal that there is a little doubt about the plan. People know that some of the money will go to people who knowningly bought more house than they could afford - hard to avoid this - yet they still overwhelmingly support the plan. That tells me that most folks know that it's needed, even though they aren't happy about the fact that we need it. I don't know what I'd call that, but it's not doubt.
March 4, 2009 2:47 PM | Reply | Permalink