The McCain Bailout Plan

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THE McCAIN BAILOUT PLAN….If Brad DeLong is right, John McCain’s new plan for bailing out homeowners is actually a bailout of the banks who originated the housing bubble’s most reckless loans: option ARMs, teaser packages, NINJAs, no-docs, and all the rest. Basically, McCain plans to buy up bad mortgages at full face value and then restructure them into cheaper FHA mortgages. Homeowners are indeed helped, but the banks who made the loans are paid off for the full amount of the loan.

Roughly speaking, Brad figures that out of the $300 billion McCain wants to dedicate to his program, a full third would go to mortgage lenders. “It means that John McCain wants to give $100 billion of taxpayers’ money to America’s worst-behaving mortgage financiers.” This is worse than the Paulson bailout approach and far worse than recapitalizing troubled banks, as many liberals think we ought to do. Brad again:

There’s a big difference here: Democrats want to prevent depression and support the financial markets by investing taxpayer money in banks with troubled assets. Republicans want to give taxpayers money away to the shareholders and managers of banks with troubled assets.

I would say that this is unbelievable, but I do believe it.

Somebody needs to ask McCain some very hard questions about the details of this plan.

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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