Not making a difference since 2006. Blog motto: Always be sincere whether you mean it or not.

Thursday, February 28, 2008

Message to you dreamers, wake up!

When I was a stripling, the adoration of "charisma" was starting to be a big thing. People would gush about how someone had it. Bobby Kennedy was thought to be a big charisma guy. Things he said would be taken as some holy writ not due to any inherent value, but because the cool guy said it.

One of his oft quoted statements, "There are those who look at things the way they are, and ask why... I dream of things that never were and ask why not." is repeated Ad nauseam. It is not his actually, but no matter, if he had said, "The law of gravity is a mere construct," people would take it as an ex cathedra utterance and say we merely have to will it to fly.

The problem with the statement is that there are often good reasons why our dreams can't happen. Even worse, if we give into our dreams, it may even be disastrous. Serious reflection is not the strong suit of our national legislature and they might be on the way to one big screw up.

Some of the rent seekers who have achieved the title of congressmen and senators have not asked "why," or "why not." They appear to want to "Just do it." What is, "it" It is giving judges the right to reset mortgage rates.

It has in a sense happened before. One of the great charisma guys of the previous century, Adolph "I got Germany moving again" Hitler tried to avoid reality in his mortgage crisis.

According to Jude Wanniski, the fuhrer's policies had led to foreclosures on farm mortgages. Hitler "solved" the crisis by prohibiting foreclosure. As no one would want to invest in agriculture under such conditions, productivity declined. "By late 1935, Germany had been advanced 500 million marks wory of foodstuffs and raw materials which had yet to be redeemed in finished goods."*

Something had to give, and it did, Poland. The Lebensraum idea became inevitable.

Now, our august solons do not contemplate a blanket end to foreclosure, just relief for the folks who suckered themselves into the subprime mortgages. This will not lead to slogans like "Manitoba is historically a part of North Dakota," but it will make it harder to raise funds for mortgages going forward. Just a little more sand in the gears.

Jude Wanniski, The way the World Works (New York: Touchstone, 1979) p.147

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