Help to Homeowners in Foreclosure

In reading various blogs and news articles regarding the ongoing foreclosure crisis in America, there seems to be a widespread perception that homeowners themselves, for the most part, are to blame for the problems, as well as predatory lending institutions. Ironically, calls have come to regulate or punish the banks and provide a bailout to foreclosure victims, but only the banks have received any help at this point from the federal government. But without understanding more of the context of foreclosure situation, all consumers are in danger of being victims of a similar crisis in the future.

Of course, the inability to see the forest for the trees, so to speak, is trained into all Americans through a public school system that leads students to believe that various subjects have nothing to do with one another. History is taught for one hour, followed by Spanish, followed by Geometry, followed by Current Events, and so on, with no interdisciplinary focus at all. The same tendency towards compartmentalization is seen in TV news programs, which function more like court stenographers simply recording who says what, rather than journalism, which would attempt to connect some of the dots between stories and their wider influences and implications. So, it is not primarily the fault of homeowners that they may be missing out on a broader exposure to issues affecting the housing market and foreclosure.

Just a few of these other issues to think about are presented below, and they are considered as starting points to begin thinking about ways in which to prevent such a meltdown in the market from happening again. No one article or book or program can ever adequately explain all of the causes for and influences on a historical event, of course, and more research can always be done on any of the topics mentioned here. With the widespread use of the internet, it is easy to research nearly anything, from ways to stop foreclosure to the implications of the drought in the American Southeast. But, some very brief examinations of the larger picture of the foreclosure crisis are listed below, all or none of which may be entirely accurate.

If the Iraq War was ended sooner rather than later, less money would be spent overseas on destroying parts of and then rebuilding those parts of Iraq. That money would not have to be borrowed from foreign investors or created out of thin air by the Federal Reserve, which means that the value of the dollar would not be in such decline. If this were the case, homeowners would not see inflation rates over 10% per year on food (has anyone seen the price of bread or milk recently? ) or oil, since the value of the dollar would remain more stable. They would be able to afford their mortgages easier, decreasing the chance of becoming a victim to foreclosure.

Oil prices are also being affected by the Iraq War right now, especially due to a fear of the war spreading into Iran. Iran controls the immensely important Straits of Hormuz, through with passes 20% of the world's oil supplies. If the war spreads into Iran, and they close off the straits, then there may well be a worldwide economic collapse, leading to much higher prices for goods and leading to even higher foreclosure rates. In fact, many of the goods we rely on daily may no longer be available, due to much higher production, manufacturing, and transportation costs. Furthermore, if there is a worldwide collapse, the United States' undefended southern border may turn into a huge refugee crisis with people fleeing Mexico, hoping that the US is more stable during the crisis.

Also, retired people living on Social Security would have a more stable income with less deficit spending, borrowing, and creation of money which results in their cost of living rising. It is likely that the people dependent on it will always get their Social Security checks, but they may be worth nothing if prices keep increasing. People living on Social Security and fixed incomes will experience inflation rates higher than their income can keep up with, which may result in their eventual foreclosures. Money that does not exist can not be spent, but the government can simply inflate the money supply, taking purchasing power from these retirees to spend on various programs and bureaucracies.

Illegal immigration is a problem mainly due to the state of the economy now, and we should always welcome guest workers and people who wish to make a better life for their families and see the opportunities America presents as a vehicle for that. But due to inflation and borrowing and the devaluation of the dollar, businesses want to keep as much of their income as possible, which leads them to hire employees for as little as possible. Because there are no wage controls or minimum wage laws on undocumented workers, besides the fact that they are not to be hired in the first place, they can be paid very little, businesses can keep prices lower and increase their profits. But this may keep jobs from others who would demand higher wages; this might force prices to increase for some goods while other businesses fail due to disappearing profits.

None of these issues have an easy answer, even though many will present simplistic sound bites or illogical justifications for one position or another. But, without addressing all of the issues at once, it is hard to focus on just one as the single most important. If we solve one, it won't have a substantial impact on solving every other problem and truly ending the foreclosure crisis. And these few concerns listed above are insufficient to address problems such as inner city crime and the war on drugs and the widespread use of stimulants, anti-depressants, and other mind-altering drugs. Another issue that should be addressed the corruption of the banking system that led to a manic lending of hundreds of thousands of dollars to homeowners who could not afford the loans, and the fact these loans were designed to be so confusing that now even the banks, investors, and courts are unable to determine who owns the loans.

Although most of these issues are discussed frequently in the news, few conclusions are ever reached and no connections are made from one topic to another. It always seems to be "Turning now to..." or "And now, for something completely different...," rather than anything more than a superficial glance at one issue. Of course, with so many issues to discuss, this can not be entirely the fault of media, who merely present what happens (stenography again). This is why it is the responsibility of Americans to become well-informed and dig deeper into various topics on their own; no one else can help them understand their place in the world unless they are willing to begin finding out themselves.