People, for years, treated a home like it was an investment. Except that they were brainwashed into not treating a home like an investment. Consider this....
You start a new business. You finance it. Your business fails. You plead bankruptcy. You move on. You feel demoralized, but not immoral. Check out how that flips when a home is involved.
You buy a home as an investment. The home's value drops, and might not rebound for a decade. Paying your mortgage would be no different from running a business at a loss. Yet like a good little debt slave, you'd feel guilty walking away. "But I promised the bank I'd pay."
That sentimentalism is exactly what banks are betting upon. It's like giving two weeks' notice. The company demands that you give notice before quitting. Yet many times they'll fire you on the spot without giving you two weeks' severance. "It's just business," they'll say, "It's not personal."
Walking away from a home is just business.
In this Wall Street Journal article about the new America (describing how the masses/little people/holli poi/grubby-fingered working men and women are getting smart enough to walk away from a home that has no value), we hear the arguments of a good little debt slave:
Tom Sobelman, whose family of four lives across the street from Ms. Richey, at 3127 Club Rancho Drive, sees mortgages as a moral as well as financial obligation. He's still paying the mortgage on an investment property he owns nearby, despite the fact that the rent is about $1,000 a month short of covering his costs.
Moral? How silly. A mortgage is a secured debt. Either pay the mortgage or surrender the house to the bank. That was the promise. So Mr. Sobelman's slave morality is especially silly, and intellectually bankrupt. And how he is a good little slave:
Mr. Sobelman, 37, argues that people who choose to default are unfairly benefiting at the expense of taxpayers, who have put trillions of dollars at risk to bail out struggling banks. "All these people are gaming the system, and I'm paying for it," he says. "My kids are going to be paying it off."
He blames the taxpayers! He doesn't blame the banks. He doesn't blame politicians who take bribes from banks. He doesn't blame Barack Obama, who received more money from Goldman Sachs' than from any other company. Good boy; come on over here while I pet your head. I'll even put some spittle on my finger, and style your hair into a cute little cowlick.
The slave morality is cultural, and what is Mr. Sobelman but a product of his culture:
Mr. Sobelman has plenty of company. In a recent study of people who owe more on their mortgages than their houses are worth, economists Luigi Guiso, Paola Sapienza and Luigi Zingales found that about four out of five believe defaulting on a mortgage is morally wrong if one can afford to pay it.
Why should one keep throwing money down a sinkhole? A home is an investment, right? Isn't that what the banksters and real estate agents told you? A person walks away from a bad investment. That's basic business. It's not personal; it's not moral; it's just business.
Culture can be changed:
But they also found that the people become 82% more likely to say they'll default if they know someone else who defaulted.
I have and will continue spreading stories of people walking away from their homes. It's time for a New American Morality. It's time that the average American played by the same rules banks play by. A bank would cut your throat in a second.
In fact, the $2.1 trillion bailouts have mortgaged your future, your children's future, and your grandchildren's future. Goldman Sachs will pay record bonuses this year. Read that again. Record bonuses - which means they will pay more in bonuses during the greatest crisis since the Great Depression than they did during the boom years.
Get smart, America. You owe nothing to the banks. One cannot keep a promise to a bank anymore than one can keep a promise to a person ransacking your home or holding your children ransom. Morality can exist only between humans. Banks are not humans.