Sunday, February 22, 2009


Yeah, right, MoDo, that's what's missing from the Obama presidency -- he's not fomenting war between the have-not class and have-not-much class:

... Mr. Obama has not yet captured either the grit the moment requires or the fury it provokes. He has not explained in a compelling way why Americans who followed the rules need to sacrifice more to help those who flouted the rules.

That is why the CNBC reporter Rick Santelli struck a populist nerve with his screed about the unfairness of responsible homeowners picking up the tab for irresponsible homeowners -- following the unfairness of taxpayers who are losing jobs, homes and savings propping up the exact same bankers and carmakers whose greed and myopia caused the economy to crash.

He spoke for those who want a pound of flesh. With the Wall Street bailout, Mr. Obama at least gave bankers a bit of the belt, and capped their pay. But homebuyers who wanted more than they could afford seem to be getting a free ride....

I'm a child of Boston who watched working-class and poor people fight turf battles over crappy-and-crappier public schools back in the 1970s, while people in tony suburbs tut-tutted, so this sticks in my craw. Yes, Ms. Highly Paid Superstar Columnist, Santelli the superstar TV talking head and ex-fat-cat trader did articulate a "populist" position, but only in the worst sense of populism. This is populism dark side: encourage people low down on the ladder to believe that all their problems are the result of sinister doings by the folks one rung below. Then stand back and enjoy the battle.

Friday's New York Times, incidentally had a story about the outrageous mortgages peddled in California to some of Santelli and Dowd's preferred scapegoats:

... One union organizer, Chris Young, showed me mortgage documents for several homeowners who got in over their heads. Like many home buyers in this heavily Latino region, they were given the hard sell in Spanish. They said they were promised affordable, fixed-rate loans, but the buried details in the papers, in English, told another story.

They were stunned to learn that 10 years of payments would go only toward interest, and that impossibly huge balloon payments lurked down the road.

Rosa Valdez said that she found out a year and half after closing on her house that she had signed on for 10 years of paying nothing to principal. Her second piggyback mortgage requires 179 monthly payments of $608.52, followed by one payment on March 1, 2021, of $61,490.69. Laura and Carlos Naranjo’s day of reckoning is March 1, 2022, when they will have to write a check for $43,365.78.

Such exotic loans might have worked in a fantasy world of perpetually soaring home prices. But here on earth, a reckoning has come due....

No, these people shouldn't have succumbed to the sales pitches. But whereas Dowd and especially Santelli want fury directed at the users, it's clear that nobody would have smoked this crack if there weren't dealers dealing.

And those mortgages weren't sold off the back of a truck -- they were sold out in the open, which told the mortgagees that these were legal, safe products to buy. Yeah yeah yeah, "buyer beware" and all that -- but this poison should not have been on the market. The fish stinks from the head. So I resent Dowd's suggestion that a little presidential rabble-rousing of the Santelli kind is in order.

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