AHHHH! AHHHH!!

Warning: this a grass-roots, non-political person’s response to something she heard on the radio.  I stand to be corrected by those who may have first hand, educated in reality opinions concerning these things:

So, I heard Mr. Obama on the radio this morning, saying that, because of the mortgage crisis, the American Dream is tottering on the edge of vanishing.  It struck me oddly.  I wasn’t aware that the American Dream had anything to do with some right to own something you can’t afford, to have more house than you’ve earned—by your labor and by your consistently responsible behavior with credit (which is to say, by hour honorable determination to pay back what someone else has seen fit to trust you with).

I keep hearing—and honestly?  I often hear it with Obama’s name and voice attached—that we are headed for a situation, or that we are in a situation that will be as bad (depends on the speech) if not worse than the Great Depression.

In honor of these assertions, I would like to quote FDR:

 “So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.”

I cannot help but feel that our present zeitgeist has been carefully sculpted, politics and media hand in hand, by those to whom it must be some advantage to keep us afraid. And the only advantage I could see in that is that people who are afraid—afraid of being poor, of going hungry, of being passed up by everybody else or of losing what they have—or think they should have, of violence to themselves or their children—they are easy to lead.  It is simple to take power from them.  They give it up freely if they believe that the Strong Voice is capable of holding a threat at bay or giving them what they want.

I don’t understand power.  The only power I want is to keep my children and my loved ones safe from bullies or flood or sorrow or sickness.  Oh, and to keep myself free and undisturbed in order to pursue my own quiet work and enjoyment.  But there are actually people who gather power that other people aren’t guarding, or that they abrogate for whatever reason.  People who want to own the fates of other people.

Why would anybody want that?  But then, why would anybody want a multimillion dollar house or a giant yacht or—stuff like that?  I honestly don’t get it.  I’m drowning in stuff as it is—an embarrassment of riches in kids’ drawings and good books and quilt fabric and history that needs preserving—in my duty to mankind, in worry about my neighbors’ wellbeing (which means in love).  I have more than enough to do in my own little pitiful thirty year old middle class house.  Why would I want more?

I heard some interesting statistics this morning, addressing this Depression business.  In the Depression, unemployment hit 25%.  That was a little bit of a surprise; the way people talk about it, you’d expect the number to be far greater – like 75%.  The actual number was enough, however, to throw the whole economy for a loop.  Now?  The number I heard this morning came in at about 7% nationwide average.  Somewhat short of the thirties.

And the “mortgage crisis”?  What does that mean, anyway?  Mortgage CRISIS?  It sounds like some kind of plague has hit us – and it’s going to get you if you don’t wear a mask in public or something.  Like it drops out of the air.  Not like it’s something you get yourself into by wanting more than you can actually afford and listening to shysters who – when they have never cared a rat’s tail about you before – are suddenly your best buddies and are willing to ignore your wretched irresponsible past in order to shovel you into some McMansion so you can feel like a rap star and they can cruise on the fees (which they get to keep if you belly up or not).

So I went searching for some historical mortgage failure numbers—a lot of people are writing about this these days—and I found this site:

http://www.housingintelligence.com/economics/some-truth-about-historical-foreclosure-rates-p-2.html

It seems that the kind of numbers we’re looking for weren’t actually recorded in those days.  But that missed payments and near defaults were.  I quote here from Jonathan Smoke, who quotes from a number of other people as well:

But in the course of looking for this data, I did find an excellent article by David C. Wheelock, the assistant vice president and economist at the Federal Reserve Bank of St. Louis. He wrote “The Federal Response to Home Mortgage Distress: Lessons from the Great Depression,” which was published in the May/June 2008 issue of the Federal Reserve Bank Of St. Louis Review. Here are some relevant stats revealed in the paper, though they are not directly applicable to the ratio cited above:

 . . . study of 22 cities by the Department of Commerce found that, as of January 1, 1934, 43.8 percent of urban, owner-occupied homes on which there was a first mortgage were in default. The study also found that among delinquent loans, the average time that they had been delinquent was 15 months. Among homes with a second or third mortgage, 54.4 percent were in default and the average time of delinquency was 18 months. Thus, at the beginning of 1934, approximately one-half of urban houses with an outstanding mortgage were in default (Bridewell, 1938, p. 172). For comparison, in the fourth quarter of 2007, 3.6 percent of all U.S. residential mortgages and 20.4 percent of adjustable-rate subprime mortgages had been delinquent for at least 90 days.”

The Chairman of our County commission, a long time real estate maven, explained this morning on the radio that, nationwide, the number of defaults is, as you see above, far, far removed from the Depression numbers.  And that most of these failures are in four states: Arizona, Nevada, California and Florida.  That leaves an awful lot of states that are not being all that affected by what is being touted as a nationwide crisis.  And further, that most of the defaults are SUB-PRIME lendings.  So numbers that are being thrown at us as though you and I have something terrible to fear, wherever we may be, are really relevant mostly to unstable people who NEVER should have been loaned money in the first place.

And why, why, why then are we so anxious that these people be rewarded by the government, allowed to keep homes they should never have bought and can not presently afford?  And if they stay in these houses, not having proved themselves as responsible financially, how will they maintain them?  How will they pay the property taxes?  The President’s statement this morning included concern about “stabilizing neighborhoods.”  But when people who have not earned the trust of creditors through responsible and long term stability are being subsidized in this way, how will keeping them in these houses by the skin of their teeth result in a stable neighborhood?

I’m asking these things not because I have some vendetta against the people who are finding themselves in trouble over this situation, but because I am TIRED of being worried.  I am TIRED of being told I should be afraid.  I believe strongly that the economy is tottering because we BELIEVE it is tottering, and so we withdraw, we don’t take risks, we don’t spend money, we tighten down the hatches.  We are the victims, in other words, of our own fear.  Also because most of the real jobs that people have traditionally done in this country – real manufacturing, real farming, real service – are being outsourced or institutionalized, there are fewer places for a man to go to simply WORK.  So that when the money gets constipated and the workforce reduced, where does a guy go so he can feed his family?

The American Dream, as I have always understood it, is this: buy some ammonia and a squeegee and go door to door offering to clean people’s windows.  Do this all day long, every day for a long time, and save the money you get, putting it into Cds and Savings accounts.  Advertise with some of that money, and when you have more jobs than you can do, because you do your job like an artist and you are charming and respectful to your customers, hire another guy to help you – making sure that he is trustworthy, and that you have trained him to be excellent.

Pay him well.  And then repeat this carefully over time.  Buy a truck and paint your name on the side, making sure that every job you do is admirable.  Get an office.  Make sure your people and your equipment are always in good working order.  Take care of your employees and your customers.  Add some services, and keep your standards and your service high.  Keep saving your money.  Give your kids a good education, buy a nice little house that will do the job in a friendly neighborhood.  Be satisfied with your life and work hard.  Hire your own kids and make sure they work their butts off.

You own your own house.  You teach your kids to be the kind of people you can count as respected friends.  You work hard and you come home to a place you can call your own.  You help others have a good life.  Eventually, maybe you can sell the company and retire.  There is no lowering government to take away from you what you’ve worked for, to tell you how to spend your money, to limit your ability to serve – you are a free human being who has built a lovely life, and you get to keep it.  Your kids are safe from harm, free to start their own businesses, teach their own kids. You all get to go to church or not, to vote or not, to choose what you will do when the sun rises.  You drive on good roads.  You can buy food from the far reaches of the country.  It’s a miracle, a miracle in history, your life.  And you are free to help someone else.  Because that’s part of it, too.  Real people helping other real people.

And that is the American Dream.  Does it totter?  No, it demands your humility, your work, your thrift, your willingness to be satisfied with what is good and what is enough.  So what was the president talking about?