It looks as though the federal government will be offering a partial bailout to the people who have been injured in the sub-prime debacle. Rates will be frozen for the next five years so that the higher rates to which these people signed up will not kick in. Gee, can I get some relief from the results of bad financial decisions I've made? What happened to the supposed wisdom of the market?
Included in this proposal is a likely $200,000,000 for credit counseling firms that happen to be supposed non-profits. I've often said that non-profits can be wonderful businesses. If the non-profit can raise enough money, it can pay its owners enormous sums without having to concern itself with the mundane tax questions of a regular business. Further, does anyone know whether these credit-counseling firms really have any effect? My strong feeling is they don't; they are just another business masquerading as a beneficent organization.
This whole sub-prime business shows America at its worst: unrestrained greed, hypocritical belief in the virtues of the market, politicians' pandering to the voters, unwillingness to act before crises occur.
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