David Brooks: Money for Idiots

Right now, the economic landscape looks like that movie of the swaying Tacoma Narrows Bridge you might have seen in a high school science class. It started swinging in small ways and then the oscillations built on one another until the whole thing was freakishly alive and the pavement looked like liquid.

A few years ago, the global economic culture began swaying. The government enabled people to buy homes they couldn’t afford. The Fed provided easy money. The Chinese sloshed in oceans of capital. The giddy upward sway produced a crushing ride down.

These oscillations are the real moral hazard. Individual responsibility doesn’t mean much in an economy like this one. We all know people who have been laid off through no fault of their own. The responsible have been punished along with the profligate.

It makes sense for the government to intervene to try to reduce the oscillation. It makes sense for government to try to restore some communal order. And the sad reality is that in these circumstances government has to spend money on precisely those sectors that have been swinging most wildly ”” housing, finance, etc. It has to help stabilize people who have been idiots.

Read it all.

Posted in * Economics, Politics, Economy, Housing/Real Estate Market, The 2009 Obama Administration Housing Amelioration Plan, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--

6 comments on “David Brooks: Money for Idiots

  1. Betty See says:

    It seems to me that if you find yourself on a swing that is swinging wildly it would be best to remain CALM, COOL AND COLLECTED and allow the swing to calm down a bit, if it will, while you figure out how to get off without injuring anyone. If you PANIC and jump off without knowing where or how you or the swing will end up you may injure yourself and other people too.
    FDR had wise words regarding this kind of situation: “We have nothing to fear but fear itself”. Poor Richard (Benjamin Franklin) also had some wise words such as: “A penny saved is a penny earned” and “Those who act in haste repent at leisure”. Maybe we could learn something from their words.

  2. Bruce says:

    [blockquote] it would be best to remain CALM, COOL AND COLLECTED and allow the swing to calm down a bit, if it will[/blockquote]

    #1, it seems to me that the last three words here are the critical point. The Tacoma Narrows Bridge did not [i]calm down[/i]. It collapsed. See [url=http://www.youtube.com/watch?v=P0Fi1VcbpAI]Tacoma Narrows Bridge Collapse[/url]

    Bruce Robison

  3. Jeffersonian says:

    Let the record show that Brooks, in characteristic fashion, is foursquare in favor of subsidizing idiocy. The corollary, of course, is that we must then tax sensibility. This will naturally bring about more idiocy and less sensibility.

    And this is what is needed to fix America’s woes?

  4. Branford says:

    From the New York Post (via Instapundit), ‘The Foreclosure Five: A National Crisis? Hardly. the rest of us are paying for the irresponsibility of a few states’

    . . . The beneficiaries of taxpayer charity will be highly concentrated in just five states – California, Nevada, Arizona, Florida and Michigan. That is not because the subsidized homeowners are poor (Californians with $700,000 mortgages are not poor), but because they took on too much debt, often by refinancing in risky ways to “cash out” thousands more than the original loan. Nearly all subprime loans were for refinancing, not buying a home. . .

  5. D. C. Toedt says:

    @Brandford [#4], I suspect it’s not a coincidence that these five states have 113 electoral votes between them ….

    @Jeffersonian [#3], Brooks clearly is holding his nose when he comes out in favor of ‘subsidizing idiocy.’ His point is that from time to time, rescuing our idiot neighbors from their mistakes is part of the price we pay for living in a free-market society that doesn’t disintegrate after X years.

  6. Jeffersonian says:

    It’s hard to find an idiocy that Brooks hasn’t been in favor of, DC, when the rubber hits the road. Fiscal responsbility for this guy always starts tomorrow, like a gourmand’s diet. Brooks apparently hasn’t let go of his nose in decades. Subsidizing folly, as Spencer pointed out, only serves to populate the world with fools. It does nothing to advance freedom nor society.

    As for your reply to #4, I couldn’t have said it better but Mencken surely did when he called modern elections, “advanced auctions of stolen goods” and scoffed that if there was any significant constituency of cannibals in America, there would be a politician promising nice, fat missionaries to them.