Saturday, December 15, 2007

This Just In: Sometimes People Make Bad Decisions

Every once in a while I hear somebody say that a politician's policy or plan "sends the wrong message." And that really gets under my skin. Why? Because our politicians aren't hired to send us messages. They're hired to solve problems. To assume a politician's solution encourages bad decision making is to assume there's a parent-child relationship between the politician and his boss (the people), respectively. If anyone should be sending messages, the people should send them to our political figures.

For those who are new to this democracy thing, here's a news flash for ya: Your fellow countrymen are going to make crappy choices from time to time, no matter what the message is. When that happens, the best thing to do is create policies that protect the responsible ones from the silly decisions of others. Don't withhold good policies simply because you're angry at the people who screwed up. A Government of Vengeance might give us a brief sense of satisfaction, but it is its own kind of dumb-ass decision.

For example, let's look at the current mortgage crisis and proposed bail-out.

If you're not familiar with the mortgage crisis, this is it in a Nutshell: a lot of folks took advantage of some juicy sub-prime mortgages to purchase houses they could not afford, the housing market crashed, housing prices tanked, and a lot of people ended up owing more on their homes than they could sell them for while their interest rates and payments started to skyrocket. As a result, a lot of people are losing their homes.

A bail-out has been proposed where the buyer's interest rate is frozen at the initial price so that they can afford their home and avoid foreclosure, thus reducing further damage to our entire economy and the property values of neighborhoods nationwide. This should even concern non-home owners because the ripples of mass foreclosures will have had an impact on all aspects of our economy, freezing consumer spending, demoralizing consumer confidence, and chilling local and state economies.

The proposed bail out is wise, sound policy. But listen! Listen close. Actually, you don't have to listen too close because some people are SCREAMING about this because it "sends the wrong message."

The people who recklessly who took out sub-prime loans they could barely afford and bought huge houses in big cities on the gamble of cheap money are about to be bailed out of their bad decision with American tax dollars. Understandably, those who resisted the siren song of cheap money, who moved to more affordable cities, who scrimped and saved to live within their means are pissed off. They're pissed off because the government seems to be rewarding the people who made poor decisions at the expense of those who made good decisions.

It's fine to be pissed off. But the policy is intended to reduce foreclosure rates which will drive down every home owner's property values and will drive down every home owner's equity and savings. We can't worry about what message the bail-out sends. Rather, we should continue to tend our own gardens and not let ourselves get dragged down by the decisions of others simply because helping them offends our sense of justice.

Let's be realistic. We will never, never, never eradicate poor decisions. We all take turns being That Guy who made the crappy choice. Except in the case of broken laws, policies should not be crafted to punish those who make bade decisions in lieu of policies that protect those who didn't.

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