This just out for my truly Conservative Federal spending and budget discipline compatriots:   

“Bush will also ask Congress to temporarily change the tax laws to make it easier for mortgage lenders to renegotiate loan terms with borrowers. If a homeowner is unable to make payments and the value of its house has dropped, its lender may want to renegotiate the loan so that the borrower owes less. A mortgage provider would, in many cases, prefer to reduce a $100,000 loan to $80,000 rather than have to foreclose on the house and try to sell it.” 

And some borrowers get to write the $20,000.00 largess off as a tax break, courtesy of the U. S. taxpayer. 

"However, under current law, the borrower must treat the $20,000 reduction in the amount owed as income, increasing tax liability at the end of the year.

"The Bush administration will ask Congress to alter the laws so that the $20,000 would not be counted as income."

 

Source:

Bush to Offer Proposals To Ease Mortgage Crisis  

By Neil Irwin and Dina ElBoghdady  

Washington Post Staff Writers  
Friday, August 31, 2007; Page A01  

I will keep my eye on this.  Perhaps those of us that were prudent and could see the coming disaster can get in on this gif to the less fortunate, or more likely ignorant or greedy, or probably both.

Over three years ago I predicted to those around me that responsible Americans would be required to pick up the tab for the “borrow and spend” individuals that were being urged to use their houses as an ATM to live beyond their means in the best interest of the sacred economy.  Now we see the leading edge of that legacy through this “spend and borrow” Bush Regime.  Our “compassionate conservative” in the Oval Office is now proposing that we the taxpayers bail out those speculators and ignoramuses among us that displayed poor judgment at best and stupid ignorance at worst.

We American “consumers” are encouraged to spend and spend and spend.  And the money people are scratching ever deeper to come up with new and novel gimmicks for lending to these American “consumers” to keep them harnessed into this carrot and carrot economy. 

It is simply suicidal to borrow long term on the value of your house to pay short term debts such as credit cards, or buy a truck, or take a vacation. 

The American taxpayer should not be made to bail out those among us that are too ignorant or too gullible to understand the siren song of the Great American Consumer Society.  It is yet another, and significant, step toward national oblivion.

God bless the sane Real Republicans of the Eisenhower and Goldwater tradition, and let's hear it for a return to principles such as fiscal responsibility.