How Politicians Can Help Fix the Mortgage Mess

Hillary Clinton has a plan to address the subprime mortgage mess, and, to my surprise, it's actually eminently sensible. Andrew Leonard says that her proposals "embody a a classic Democratic approach, a big government solution that will cost money". But in fact the amount of money involved in the proposals is small: $2 billion in total. That's just a few hundred bucks, tops, per household burdened with a resetting adjustable-rate mortgage.

Clinton has seven specific proposals, none of which will solve the problem overnight, but which, taken as a package, will both help ameliorate the worst effects of the present crisis and also help prevent it from happening again. Most of them should be broadly palatable, too.

The first two proposals simply aim to inject some transparency into the murky world of mortgage brokers, which has got to be a good idea. The second two proposals help prevent borrowers from signing up for mortgages they can't afford, which is also good: while not outlawing such behavior, they would make it harder for people to do it unwittingly. The third pair of foreclosures address the current situation, and try to give some kind of help to homeowners who desperately need it. And the final proposal simply helps to build more affordable housing.

The first four proposals, then, are utterly unobjectionable, and the last three are all good ideas. Let's see if any Republicans start talking along similar lines, and we might not have to wait until 2009 to start enacting them.