Proof of income from borrowers. No penalties for early mortgage payments. And a guarantee that property taxes and insurance bills are covered. The Federal Reserve is considering these and other measures as a way to remedy the troubled market for high-risk, or subprime, mortgages. The central bank held an all-day hearing on the matter Thursday.
So far so good.
Lawmakers are pushing the Fed to act as late payments and new foreclosures on adjustable-rate home mortgages made to people with spotty credit climbed to all-time highs in the first three months of the year.
And I agree with the notion that risky loans should never get made to people who have no business getting one.
"We have had more than enough talk," Sen. Sherrod Brown, D-Ohio, said in a statement. His state has been hit particularly hard by a wave of foreclosures. "The Federal Reserve should have acted long ago to stamp out the abuses we have seen in Ohio and across the country."
Industry executives are urging the Fed not to limit the availability of credit by overreacting to the problems in the market, while consumer groups say the central bank should have cracked down on abusive mortgage practices years ago.
One day in the House of Representatives a bill was taken up appropriating money for the benefit of a widow of a distinguished naval officer. Several beautiful speeches had been made in its support. The speaker was just about to put the question when Crockett arose:
"Mr. Speaker–I have as much respect for the memory of the deceased, and as much sympathy for the suffering of the living, if there be, as any man in this House, but we must not permit our respect for the dead or our sympathy for part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has not the power to appropriate this money as an act of charity. Every member on this floor knows it..We have the right as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I ever heard that the government was in arrears to him.."Every man in this House knows it is not a debt. We cannot without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as charity. Mr. Speaker, I have said we have the right to give as much money of our own as we please.