USA Today’s take on the mortgage mess posed a crucial question: “Should taxpayers in Vermont be asked to bail out home buyers in Nevada?” The nation’s No.1 newspaper went on to note: “The answer now taking shape in Washington appears to be, ‘Yes.’”
But the multi-billion dollar question for taxpayers in Vermont and other states that didn’t plunge headfirst into risky housing deals is “Why? Why should we be stuck with the tab?”
One answer to that question: “Politics.” Let’s go to the map:
The housing bailout plans before Congress will subsidize bad mortgage deals in the dark colored states with taxes collected from light-colored states where no real “crisis” exists.
Many of those dark states have tremendous political clout. Not only is the delegation from vote-rich California the largest in the House, it’s led by the House Speaker. Nevada is home to Senate Majority Leader Harry Reid. The chairman of the House Housing Committee, Barney Frank, hails from Massachusetts. And calculating politicians from both sides of the aisle want to be seen as “doing something” to help out in Florida and Ohio, which figure to be swing states in the upcoming election.
Politicians have long boasted of their ability to “bring home the bacon.” The mortgage meltdown is yet another opportunity for pols from “crisis” states to shovel money to the folks back home. Unfortunately, they’ll be shoveling it from the pockets of taxpayers in the pale states who were just too “foolish” to not take out a mortgage they couldn’t afford.