Dems in three states favor bailout: poll

A quickie tonight from the hometown newspaper: "Democratic voters in key primary states don't oppose the Bush administration's action to save investment firm Bear Stearns Cos. from bankruptcy, but most also think the government should bail out homeowners caught between rising mortgage payments and falling home values, a Los Angeles Times/Bloomberg poll has found."

The key states where likely Democratic primary voters were polled are Pennsylvania, North Carolina and Indiana -- I'm not sure any of them contain markets overheated by the housing bubble. Here's the housing bailout question: "Are you in support of or opposed to the federal government bailing out individual homeowners who have been caught between rising mortgage payments and falling home values?"

In Pennsylvania, the responses broke like this:
Strongly in support of: 34%
Somewhat in support of: 29%
Total in support of: 62%
Strongly opposed to: 15%
Somewhat opposed to: 13%
Total opposed to: 28%
Don't know: 10%

My two cents: I'd love to see a good California poll on housing issues.

Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.

Comments

[tew]

It's all how you frame the question.

So many people in these non-coastal states (and yes, I know N.C. borders the Atlantic) really have no idea how much fraud has been perpetrated by some many slimeballs. It's up to everyone who knows the score to get the word out to these well-meaning people "Folks, this isn't Aunty Mae unable to pay the mortgage on her double wide. This is lots of folks with fancy cars, good jobs, no money down, and no plans of curbing their 'lifestyles'."

[Dan]

I was a democrat, but stuff like this idea that "every time someone loses some money the government should just tax people more and give it to whoever whines the loudest" has driven me far, far from the party. With the war, I'm not ready to vote for the republicans, so I'll probably throw a protest vote towards the libertarians.

They've seemed a bit nutty in the past, but "no war, no taxpayer-funded bailouts" sounds pretty good right about now.

[buz]

I think the poll question is bad and doesn't reveal the true nature of what led to this situation. This is not about keeping poor souls in humble little houses on the prairie in Kansas. A more accurate poll question would be- " Do you support a government bailout for people who overextended themselves betting on a continued housing boom and got cought when the market turned?" I think this more clearly states the situation and would get a far different response.

[Fred]

I'm no math major, but those numbers don't add up to 100%. Could people give multiple answers?

[Jake]

People who took huge mortgages that they not only could not afford but should not have been given need to lose their homes and start over again. Next time around they'll be a little smarter. The foreclosures will create a new market for people who have saved for a down payment and worked to obtain a stable, sustainable lifestyle.

[Chris]

Conservatives - Not Republicans - say people must do things right or face the consequences.

Liberals - Not Democrats - say let's help people who were the genuine victims of predatory lenders.

Criminal Communists say lets bail out wall street and main street and send the middle class to the poor house!

[Chris]

The question was probably phrased like this

Do you want housing to crash putting the US economy in the tank causing millions of job losses or do you want to help keep honest working americans in their homes?

[Giacomo]

The Great Divide in this country isn't rich/poor or Republican/Democrat: it's between people who are prepared to face life as adults, with it's dangers and rewards -- and those who want government to step in where Mommy and Daddy left off.

I have great fear that most of our grandchildren will be depending on government not only for health care and education, but for their jobs and their housing as well. Food lines come after that. No rresponsibilities, and no options.

[Louie B]

In response to Fred's comment, that would be 62% in support (34% + 29% rounded off) + 28% opposed (13% + 15%) + 10% clueless. Speaking of clueless, many homebuyers who are in trouble never did the personal financial math to determine if they could actually afford the obligation they were taking by purchasing a house, let alone understand the terms of the loan itself. As is put forth in Economics 101, its "guns or butter", not "guns and butter". People have to learn to make choices (rather than ordering everything on the menu) when it comes to allocating income to housing vs. discretionary expenditures. If they can not afford the house, sell it or get repossessed. A bailout only sustains the inebriated borrower rather than sober them to the reality of the situation. Last, those in default tend to default again, so why give the benefit of doubt to a high risk borrower...

[Robert Laughing]

Peter, your 2 cents??? Just read the bloody LA Times = 'ell NO! to a bailout of lying or stupid borrowers, including those in the bank/mortgage industry. It's ALL in the Times...you just GOTTA READ IT, and sadly, given the voting history in LA,CA and USA, COMPREHEND it! That's the tricky part; com - pre-hen-sion!!! Look it up. One could deduce and swear by it, that the American citizenry are illiterate, if not brain-dead, the way both the Dems and Repubs have ruined this country...while the citizens go 'shopping.'

[Jeff]

Well said Giacomo!

[arroyogrande]

"who have been caught..."

It's all in the wording, isn't it? "Have been caught" implies that the homeowners were 'underwater' on their home values through no fault of their own, or that they didn't have a choice in the matter.

It's the difference between asking to bail out someone who "found themselves with negative equity" (it wasn't their fault) vs. asking to bail out someone who "now has negative equity" (no blame) vs. asking to bail out someone who "paid too much for their house" (fault lies with the borrower).

Is it appropriate to say that people "have been caught" (ie "no fault of their own") when a majority of the people in trouble used serial teaser rate financing, used exotic mortgage products/ARMs/negative amortization loans as 'affordability products', financed 100% of their house purchase (no money down), extracted 'equity' from their house (using HELOCs or HELs) to buy consumer goods and remodel, used "stated income" (aka "liar loans") to qualify for an expensive house, or bought a house at the top of the market?

Think about it...if none of these conditions applied, you wouldn't be in trouble on your loan, except for the standard number of job losses and medical emergencies.

- arroyogrande

[la voce bella]

Pick up a copy of Lee Iacocca's new book, entitled "Where Have All The Leaders Gone?" It's an eye-opener and a reminder that we have a responsibility to get this country moving again.

Before anyone balks about Iacocca and Chrysler, please be reminded that he brought the company back AND paid off the loan 7 years early. Does anyone actually think that would happen today?

Let's forget whether someone is telegenic or has an MBA...we need to get back to basics and not be afraid to do it.

[JohnnyB]

As others appropriately note, the question is slanted. It is phrased as such to evoke a positive response. It is framed to elicit a "rescue thy neighbor" emotion because they are "caught" (or trapped) by two enormous, cold, relentless forces - like being caught between a rock and a hard place due to unforeseen causes. Who doesn’t want to be a hero and lend a helping hand to a neighbor during an unforeseen disaster.

As we know, most folks haven’t thought this through and most are not aware of the extent of this bubble, the greed of “thy neighbors” across state lines (and all the complicit and corrupted industry playaz), the enormity of the crisis, that it was not unforeseen and that this will be like burning their hard earned money in a bonfire of the vanities to save the billionaire bankers who initiated this countrywide bubble scheme.

Of course, the red flag was the pollster tag team of the LA Times & Bloomberg. The former being the biggest RE and bubble promoter in the country and the latter being unavoidably linked to New York’s financial capital of the world and home of team Ponzi and the collapse mitigation squad.

[jb]

My democratic party has completely foresaken me. I will no longer support them on any issue (yes, I dont care if mccain becomes president, I will simply not vote at all)

[MyLessThanPrimeBeef]

Fred, it goes something like this:

Strongly in support of: 34% (probably 33.5)
Somewhat in support of: 29% (probably 28.5)
****************(SUB)Total in support of: 62% (33.5 + 28.5)
Strongly opposed to: 15%
Somewhat opposed to: 13%
**************** (SUB)Total opposed to: 28% (15+13)
***************** (SUBTotla) Don't know: 10%

Total: 62%+28%+10% = 100%

[MyLessThanPrimeBeef]

Chris, you are right. Sadly, today's Democrats are not really progressives anymore.

An eighteenth century, Age of Enlightenment liberal would be against concentration of power, in any form, which happened to be the monarchy at that time.

But today's Democrats are not really against big, powerful corporations where financial/monetary power is concentrated. A true liberal would also be against big government where too much political power is concentrated.

[Teresa]

I live in Delaware, just south of Philadelphia, and I can attest that the ONLY people living here who have any clue of what's going on in California are those who, like me, moved here from California (or Florida, or one of the other bubble areas).

Tew is right. People out here THINK they're supporting bailouts for the truly unfortunate: People who found themselves unable to pay their mortgages after a job loss (through no fault of their own), a serious illness, or the death of a breadwinner. What these people need to realize is that the overwhelming majority of these bad loans did not go bad because of the kinds of things I just mentioned. They went bad because idiots making $12.00/hour were handed $400,000.00+ loans.

[save your ammo]

They need to ask this question in one of the
six bubble states. Especially, Florida and California.
Then they need to tell those in a national poll that
this is basically a six state problem for reasons X,Y,
and Z. Then let them vote on a bailout. The wording
is everything and the wording is being twisted,
intentionally.

[Joseph...The Real Estate Guy]

I happen to agree with most of you again!

You guys have hit the nail on the head again!

I still get buyers wanting to buy "No-money" down!

These people are fools!

They failed for the meat from Wall Street!

[anonymous]

Teresa and Tew are right. Also note not everyone following Peter's blogs are dealing with this issue in California. Including me. I'm dealing with it in Nevada.

[sean]

Teresa is 100% dead on right.

Joe the Real Estate guy - just why should ANYONE be given a mortgage with "no money down"? This is why we are in this mess to begin with. I hard learned lesson for banks - deadbeats don't pay you back.

[elainekramer]

The idea that folks that knew they couldn't afford those mortgages and some not even reading the terms of the mortgage they signed DO NOT EVER NEED TO BE BAILED OUT. They shoulld go to jail as they didn't ever think they could afford the house they bought anyway. Only a Government of Fools couldn't figure out how many of us were seeing these subprimes and figured the Senate Banking Committee would close these things down. Now those self-same Senators are leaning on me and others to make these folks happy by allowing the use our tax dollars to help pay for the houses that should never been sold to these folks.

SOMEBODY NEEDS TO TELL THESE BORROWERS THEY WERE CRIMINAL FOR ACTUALLY SIGNING THEIR MORTGAGES AND THEY NEED TO LIVE WITHIN THEIR MEANS OR PAY THE CONSEQUENCES. DON'T ASK WORKING FOLKS THAT ARE RENTING AND PAYING ON TIME OR MORTGAGE HOLDERS KEEPING WITH THEIR MORTAGES ON TIME TO BAIL OUT THESE LOWLIFE CROOKS WITH EVEN A DIME OF OUR TAX DOLLLARS.