On the Obama administration’s plan to use unspent bailout money to help homeowners avoid foreclosure:
I think that’s the nub of the problem that you can’t really solve. It is unfair, but it’s also necessary.
It’s exactly unfair for the reasons that we heard. You pay your mortgages. You have two jobs. You scrape and you get by. And the guy next to you who takes a vacation, skiing in Aspen, and spends it on all kinds of stuff, he gets assistance through the program where you use the TARP funds to give the banks incentive, i.e., cash, to give you a break on the mortgage and . . . to cut down the actual value of the mortgage.
On the other hand . . . if you have a foreclosed house, it’s abandoned. It costs the bank $50,000 to deal with it and it blights the neighborhood, and it reduces the equity on your house, [you] the guy who has been working hard to pay it off. So overall you have to do something.
The problem is you can only help [at] the margins. The reasons we are having a new program now is because the old one hasn’t actually helped a lot of people.
What you have, I think, is the compulsory program, which is [for] the unemployed. They get a six-month break, which will probably help a few folks who get a job, but obviously it’s not going to help those who are still unemployed at the end of the six months. And the voluntary program, where you give the banks incentive [to modify the loan terms].
Overall, it isn’t a bad idea. What it will probably do, it will make the housing recession shallower but longer, rather than steeper and shorter. . . .
Because, if the government laid hands off, you would have a crash. You would have an excess of houses. Houses would be so cheap they would begin selling again. But, in this economy you don’t want a risk of a V-shaped collapse like that.
On the big winners and losers in the health-care debate, leaving out the obvious winners President Obama and Nancy Pelosi:
Big loser: Bart Stupak — playing way over his head in the big leagues. He wasn’t prepared. He couldn’t stand the heat in the kitchen. He ran out screaming, waving a useless executive order.
The big winners are the young guns in the Republican House, Eric Cantor and Paul Ryan. Ryan is the king of wonk, and Cantor was [an] excellent [Republican] spokesman, a defender of truth, justice and the American way.
On the Iraqi elections:
It’s also the most critical moment in the history of Iraqi democracy. Can there be a peaceful transfer of power? Maliki has been speaking — threatening about using the army or calling out the mobs in order to stop Allawi. If he does, this will be a very difficult day for us and a huge setback for any chance of democracy in Iraq.
On Sarah Palin’s campaigning for John McCain against J. D. Hayworth:
Poetic justice. He created her. She now is in Arizona trying to save him. It’s the happy ending to a May-December romance — it appeals to the romantic in me.