Housing Enactment Provides up to 400,000 Government-Insured Loans

From today’s newspaper, a recent piece of completed legislation, bill H.R. 3221: Foreclosure Prevention Act of 2008 is described as

… the most aggressive intervention by the government into the housing market in more than a generation, perhaps since the New Deal….

The enactment of the legislation comes in the same week that the administration announced that Mr. Bush would leave behind a record $482 billion deficit, which will probably grow substantially if home values continue to decline and if there are further reductions in corporate and personal income as many economists are forecasting for the rest of the year. Because of the growing deficit, Democrats said, the debt ceiling had to be lifted regardless of the housing bill.

The new housing law includes a plan aimed at helping as many as 400,000 homeowners pay off their troubled mortgages and replace them with more affordable, government-insured loans. The program is voluntary and the lenders must agree to take a sizable loss, reducing the principal of each loan, before they can be refinanced.

…

David M. Walker, the former comptroller general of the United States and head of the Government Accountability Office who is now president of the Peter G. Peterson Foundation, said that Mr. Bush might have been unwise to sign the measure.

“Providing authority to the secretary of the Treasury to extend credit or to buy stock is one that will end up costing the taxpayers tens of billions of dollars.” …

Mr. Walker noted that other government interventions in the private market, including a rescue of the Chrysler automobile company had provided an opportunity for taxpayers to profit. But when it comes to the mortgage giants, he said, there is no upside.

“The way this is structured,” he said. “It’s only a matter of how much the taxpayers are going to lose.”

Source: Sweeping Housing Bill Signed by Bush, from NYTimes.com, emphasis and links added.

I agree with Mr. Walker: this bill is financially unwise.  Do we really expect the Government to save us from our own foolish mistakes?  We are the government. We, the people.

A word on the time that the U.S. Government saved Chrysler:

The Chrysler Corporation on 7 September 1979 petitioned the United States government for US$1.5 billion in loan guarantees to avoid bankruptcy. …

The United States Congress reluctantly passed the “Chrysler Corporation Loan Guarantee Act of 1979″ on 20 December 1979, prodded by Chrysler workers and dealers in every congressional district who feared the loss of their livelihoods. The military then bought thousands of Dodge pickup trucks which entered military service as the Commercial Utility Cargo Vehicle M-880 Series. With such help and a few innovative cars, especially the invention of the minivan concept, Chrysler avoided bankruptcy and slowly recovered.

…

By the early 1980s, the loans were being repaid at a brisk pace and new models … were selling well.

Source: “Government loan guarantees“, section from “Chrysler” article, Wikipedia, removed parenthetical statements.

So, what is the proper role of government?

Social Networks and Internet Safety

I wish to respond to “What Are Social Networks?” from LDSMediaTalk.com, which begins

Online social networks are communities of people who share common interests and activities. Social networking sites provide the ability to create a personal profile and various ways to interact with other people, such as messaging, e-mail, video, text or voice chat, file sharing, blogging, and discussion groups. Social networking has revolutionized the way many people communicate and share information with each another. Social networking Web sites are used by millions of people everyday on a regular basis. For many people, online social networking has become a part of everyday life.

Most social networking services contain directories of categories (such as former classmates) and methods for connecting with people (usually based on some system of referral and trust).

Three very popular social networks [... Descriptions of MySpace, Facebook, and LinkedIn]

Source: What Are Social Networks? | LDS Media Talk, by Larry Richman, Posted July 29th, 2008

Thank you, Larry, for a great article; too many people still think that the top two uses of the Internet are genealogy and pornography; in truth, Social Networking is the number one activity online today.  Your article is well written and the embedded video is perfectly applicable.  The descriptions for each of the three sites are clear and concise.  However, your article is incomplete.

As you explain the basics of social networks, will you please add a word on safety?  If I were a parent learning about social networking and I read your article, I would be inclined to open an account on MySpace for my children.  However, MySpace is notoriously unsafe because your profile is publicly visible to the world.  It is a dark alley where child pornographers harvest victims. In a recent church meeting I attended, the bishop made it clear when he said, “My children are not allowed to have a MySpace account.”

Facebook is slightly better, because your profile is (by default) private to your contacts.  However, now that Facebook has adopted an open registration policy, villains can masquerade as your “friend” and similarly trap and abuse children. In contrast to MySpace, that bishop said, “My children are allowed to have a Facebook account, and we [the parents] regularly look at it.”  He strongly urged the parents to be aware and involved in the Internet activities of their children.  He also encouraged us to embrace the Internet as a good tool to share the Gospel.

President Hinckley, with prophetic vision, told the youth of the Church in 2000:

And don’t try to create associations through the Internet and chat rooms. They can lead you down into the very abyss of sorrow and bitterness.

Source: A Prophet’s Counsel and Prayer for Youth, by President Gordon B. Hinckley, from lds.org

In other words, use online social network tools to build and enhance the good relationships you already have: family, friends, and business associates.  Do not meet people online.  Again, the prophet counseled, “Don’t try to create associations through the Internet.”

Remember, the Internet is very much like streets of your city.  And just as you would never allow your child, whom you love, to wander down certain dark corners of your city, you would never let them wander through dangerous websites.  Out of love, we must be clear as we teach and guide our children and loved ones through this increasingly complex world.

Update: 13 Feb 2009: Corrected spelling of “Facebook” (previously “FaceBook”).

AMD Sells 8% to UAE

Buried near the end of an article on an over-hyped topic, the following caught my attention:

In November [2007], the company [AMD] sold an 8.1 percent stake to the Abu Dhabi government’s investment arm.

Source: “AMD changes CEO as turnaround pressure intensifies” from AP, Via Google

I giggle when I find the true news buried beneath the diluted headline.