False Hope Is Far Worse Than No Hope

What is wrong with hope?  We know that in an impossible situation where the outcome is unknowable, hope can keep us in that situation long enough to triumph or despair.  The problem comes when hope is not accompanied by action.  When things look hopeless, we either give up or fight on with everything we have.  When we are given false hope, assurances that all will be well, despite the looming crisis, we either relax in the happy notion that it will work out, or we fight on, but not with everything we have, rather with the idea that fate or miracles will save us.

It seems that the past few years in America, we have operated on the false hope that the federal government has the ability to control economic and world events.  Our hopes were elevated after 9/11 by the war on terrorism, including military interventions in Iraq and Afghanistan.  The results have been weak to poor.  We have burdened the future taxpayers with four to six TRILLION dollars of future obligations, and for what?

We have exhausted our volunteer military with short turnarounds and multiple tours.  We have aggravated and elevated the importance of the leaders and citizens of the region with our misunderstandings, ignorance, and arrogance.  No one has ever been able to extract the minds of the people from the secular feuds, endemic poverty, and warlord mentality since before the birth of Christ.

Everyone else on the planet sees our hubris and disrespect for other cultures, yet we continue our Crusades.

What if we had recognized the damage and pain inflicted on our national psyche by the 9/11 attacks?  What if we had reconsidered our smug attitudes toward the rest of the world?  What if we had just revised our approach of insisting that democracy is the best form of governance for everyone regardless of their history, culture, economy, and philosophy?

Instead, we embarked on a path of attack and appeasement.  We attacked anyone who remotely seemed to be a threat with no idea what to do and whom to do it with or to.  We were ready to believe that the vast expenditures and capabilities of our military could subdue the culprits and liberate the subjects of our perceptions of tyranny.  We took no heed of the clear indications that the religious and cultural context these people were born and raised, they see as absolute truth.

What made us think that pouring billions of dollars into the hands of a culture that values corruption and cheating as an art to respect would buy us anything but hate and deceit?  Where else have we bought victory or power with our Niagara of free money?

We fooled ourselves that the impact of the attacks on world confidence and finances was easily healed.  We proceeded to go on a spending spree of unheard of proportions, borrowing as much as our credit could bear, and more, when politics made buying a home hysterically important and easy for virtually anyone.

Our false hopes led us down a path of self-destructive thinking and acting.  In the midst of an unmitigated world financial crisis, governments took on the bad debts of citizens using the creditworthiness of nations.  Now that that burden has become untenable, we see financial strategies that verge on desperation and still try to maintain the illusion that the solution is at hand.

I wonder what paths we might have taken without the false notions and optimism on which we proceeded to get where we are today.

Are We the American “Whos?” – Are There Any “Hortons” In Washington?

Lately, I get the nagging feeling that Americans actually believe that politicians care about THEM as people.  I do not buy it for one minute.

Have you ever had personal communications with representatives in local, state, or federal government?

Have you tried to write, email, or phone your U.S. House Representative or Senator?

Have you seen what you get when you do?

Except in rare cases, you get “boilerplate” position letters, sent by staff, who must glance briefly at incoming correspondence to see which stock reply to send.

I think we get far less than taxation without representation.  I think we get no respect at all.  I think we are the “Whos” in the Dr Seuss book “Horton Hears a Who.”

Want examples?

In January 2009, I sent emails to my Congressman, both U.S. Senators from the state of Texas, and President Obama.

“An Alternative to Foreclosure,” (see my blog in the April archives) which proposes using “Mortgage Conversion Contracts,” instead of foreclosure for viable homeowners.  The owner exchanges equity and mortgage for a market rate lease, with an option to buy.

I had several real estate and mortgage experts review the idea for legality and viability.  They thought it was a great idea.  They also suggested that it needed to be endorsed and encouraged by the Federal Government.

This approach avoids foreclosure costs, credit devastation, evictions, empty houses, damaged neighborhoods; it leaves the homeowner in the house, with undamaged credit, and an option to repurchase, if they recover.

No response.

Two and a half years later, with millions of families devastated, housing markets in shambles, a gigantic overhang of foreclosures, the headlines read, “Banks need to rent those foreclosed homes they own.”  Duhh!

Likewise, I sent emails to propose the instant stimulus of suspending FICA withholding for both employees and employers, as did John McCain in his campaign:

  • Employees take home 6% more
  • Employers reduce payroll costs by 6%
  • Employees have more to spend each month
  • Employers benefit to the extent they employ
  • Employers have less incentive to lay off staff
  • Less administrative expense for employers and government
  • Resume FICA gradually as necessary

No response.

Instead, this year, the government implemented a 2% partial suspension of FICA withholding for the employee only.  Today they make a big deal out of extending it.  What do you think the impact would have been if the government had suspended FICA two years ago, for employees, and business owners who still cannot get a loan at the bank?

What possible motive could the politicians have for ignoring real solutions to the problems we are facing today?  Could it be that politicians do not care about us at all, except at election time? Could it be that power is all they want? Do problems help politicians keep and gain power?

Apparently the denizens of Washington, DC know that all they need to do is give the illusion that they hear us, pretend they represent us, promote class warfare, use rhetoric, and vague platitudes, and we will still believe them.

Each of us needs to make sure our government knows we are here.  They need to treat us with respect and give us their attention, no matter how small we may be to them.

If you feel like a “Who,” join me in yelling as loud as you can,  “Hey Washington, WE ARE HERE!  WE ARE HERE!  WE ARE HERE!”

An Alternative to Foreclosure

One of the stressful prospects facing many American families is losing their homes through foreclosure.  The Federal government is searching for ways to prevent this from happening.  The situation is difficult to solve with conventional thinking.

  • The homes cannot be sold for the price the owners paid.
  • In some cases, the homes cannot be sold for the balance of the mortgages.
  • Many of the mortgages have adjustable rates, which have risen significantly to the point that the payments are beyond the families’ ability to pay.
  • Foreclosures depress the market values of neighborhoods.
  • Vacant homes invite unwanted elements into the neighborhood.
  • Foreclosure gives the mortgage holders the costs of the process and the burden of managing or selling the homes in a depressed market.

The homeowners want to remain in their homes, but they have limited incomes to pay for housing.  Even if the homeowners remain in their homes, they may never recover the amount of the mortgage when they sell.  Foreclosure would create financial and legal costs for everyone and destroy the credit rating of the homeowners.

The mortgage holders do not want the costs of foreclosure and they have limited abilities to manage or sell the homes.  The neighbors want their neighborhood to keep its value and safety.

What can we do?

How would it be if the homeowners could remain in their homes at a cost within their budget?  What if the mortgage owners could still receive a return on their investments?  What if the costs and stigma of foreclosure and its aftermath could be reduced?  What if the costs to the taxpayer could be reduced or eliminated?

Consider this:  A new agreement between the homeowner and the mortgage holder:  a “Mortgage Conversion Contract.”  The homeowner gives up ownership of the home in exchange for relief from the mortgage and an affordable lease of 3-5 years with an option to buy the home after that.

  • The homeowner remains in the home, without the problems of bankruptcy and with the possibility of becoming a homeowner again.
  • The mortgage holder becomes a landlord with rental income and time for the market value to recover, once the current crisis passes.
  • The Federal government could subsidize creation and implementation of a model “Mortgage Conversion Contract” to speed the process and assure fairness.
  • If the homeowners qualify, they could receive rent subsidies under existing government housing programs.

This concept could ease the stress and costs on millions of American homeowners and the holders of their mortgages. How does that sound to you?