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Where’s My Bailout?!?!
The US government is going bailout crazy. Once they loosed the genie from that particular bottle, everyone and their brother is showing up at the trough hoping to get a bite. Who knows anymore what the original intent was - a banking bailout, a wall-street bailout, a bailout of AIG, isn’t it supposed to have something to do with a housing bailout, and now the domestic auto companies and even credit card companies are clamoring for a piece of the pie (I think that sets a new personal best in the category of "most cliches used in a single paragraph!").
Some people actually acted responsibly over the past few years…
All of this, as might well be expected, has a number of people up in arms. Even in the midst of the housing craziness of the past few years, there were actually some responsible people who bought a house based on how much they could afford to pay for it as opposed to how much loan they could get (no stated income, interest-only, negative amortization anyone?). These silly people actually eschewed irresponsible purchasing and did not buy a McMansion because they held to some crazy belief that you should be able to afford the things that you purchase. And what do they get to show for it? Nothing (maybe even worse than nothing!).
And now you get to pay for the people who did not
The government has swooped in to save the day and take care of those who overspent and overindulged while the responsible pay for it through their taxes. Some of the responsible could swallow the original argument that it was for "everyone’s good" because eventually all the foreclosures and their resulting effect on the economy would bring down the value of their home as well and possibly cost them their job. So, they swallowed the bitter pill and moved on. But now they are talking about bailing out people who ran up too much credit card debt - this is getting ridiculous!
So, what can you do?
Well, nothing really. Let’s be blunt: you are going to get screwed. The government is handing out their candy to everyone else except you. (Isn’t it interesting that if do something stupid and mess up, you have to deal with the consequences. But if enough people do something stupid at the same time , the government will come in and clean up the mess). The obvious answer is to get involved politically. Call you representatives. Tell them how you feel. Get involved in whatever way you can.
Your only consolation is that at least you did the right thing
I agree that it stinks that the foolish are bailed out by the prudent (and by "prudent" I don’t mean the government). It is annoying how, in this situation, stupidity is seemingly rewarded at all levels (buying a $650,000 house with a salary of $55,000? Well, the bank wouldn’t let you do it if they weren’t confident you could repay it so you must be able to afford it! You’re going to give a $650,000 loan to a person who makes only $55,000? Sounds like a good idea to me - so what are you going to spend your commission on? You really think buying a whole bunch of irresponsible loans will make all the risk go away? You fancy finance guys sure are smart! Better yet - why don’t you borrow a bunch of money so you can buy even more of those loan package deals and greatly multiply your gains!)
And you’ll probably try to do the right thing tomorrow too
Let’s be honest here…you, as a fiscally responsible person, will not learn your lesson. Tomorrow you will go out and attempt to make more responsible decisions. You will even try to learn from the borderline decisions you made yesterday. And after you purchase big items, you will probably pay back the money that your borrowed, right? For those of you making such "foolish" decisions, remember this:
The wicked borrow and do not repay, but the righteous give generously. Psalm 37:21 (NIV)
Remember, it doesn’t matter what everyone else is doing. It doesn’t matter who is not paying for what they bought nor whether they experience any ill effects from it. The Bible tells us to be responsible in our decision making and then to honor any debts or obligations we undertake. While we’re on the subject, here’s another thing to remember:
In the house of the wise are stores of choice food and oil, but a foolish man devours all he has. Psalm 21:20 (NIV)
So, what have we learned?
When you were younger, I’m sure your mother told you not to do something just because everyone else was doing it ("If Johnny jumped off a bridge, would you jump off one too?"). So, we need to continue to follow that advice now. Continue on the path of financial responsibility because you know it is the right thing to do. Continue to not spend more than you earn and continue to pay off any debts you have incurred (and try to stay away from any new debts). It might not work out optimally for you in all cases (as current events are showing) but when you go to sleep at night, you can rest comfortably knowing that you are attempting to follow God’s mandates for living responsibly and being a good steward of your resources.
Do not be bitter that your neighbor has all those fancy toys that he put on a credit card and/or a home equity loan and now he might get some help from Uncle Sam to pay them off. Bitterness will certainly do you more harm than good. Do not covet what your neighbor has, for along with the mortgage and credit card help will come the trashed credit score - and I’m sure you don’t covet that!
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I agree that bailouts are a bad thing; in fact they make me a little ill. The idea of fairness in all this mess is tough to apply, and it’s pretty easy to get caught up in everything, I know I have a tough time.
Those who don’t get something free from the government, or taxpayers, really have earned something more valuable then a chunk of change meant to bring them back to some kind of semblance of life before the qualifying event, disaster, financial crisis, decades of auto company stupidity, etc. They have earned independence, the idea that they don’t need others to sustain themselves and their families…They can, through their own ideas, hard work, luck, whatever it takes, survive and sustain.
It isn’t as much fun, and it sure isn’t as easy, but it’s definitely better in our books.