Housing crisis a war on middle class America.

We have a housing crisis in this country, but the crisis is not rising foreclosure rates and rundown neighborhoods. After all, those elements have existed before and they are a natural part of the real estate market's ebb and flow. There is another crisis unfolding, a crisis that the media will not report and the politicians will not acknowledge. War has been declared on every single American who in the past several years did all the right things and made all the correct decisions. Somehow it has been established that those suffering the impending housing doom are victims of greedy bankers and exploitative free marketeers unleashed upon America due to 'deregulation'. It has been estimated that those suffering foreclosures number somewhere between 4 and 6 million people. For perspective, there are as many Facebook fans of Barack Obama. The remainder 295 million Americans due to sheer cunning shrewdness and genius escaped the prying clutches of money grubbing bankers and for this cunning mischief there will be retribution.

Retribution comes in the form of aid to those in need (sometimes), paid for by the lucky 295 million. Before delving into the "stimulus" bill passed yesterday, observe two perks being distributed, two perks passed by our Congress.

First is the 7,500 tax credit to new home buyers, assuming the new house was purchased after April, 2008. At first blush, this appears to be a clever incentive to promote new home buying and perhaps stifle the surging avalanche of falling prices and foreclosures. I am just a bit bitter perhaps, because my American dream began January 2008 and therefore I am not eligible for the gracious gift bestowed to us by Congress. But despite my bitterness, I want to ask the politicians a very simple question; If you are trying to stem the flow of falling house values why are you NOT helping the people who already own the home? How is rewarding people who are arguably getting a much better deal than those who bought homes in 2007 make any logical sense? House prices peaked in 2006, fell sharply in 2007 and slid some more in 2008. Why is the tax credit not being directed to those that suffered the sharpest and most dramatic house values declines? Why reward people who are clearly in a position to buy a house anyway and if they are not in a position, then is not creating an extra incentive for people to buy homes the very reason we got into this mess in the first place? Why are responsible Americans who are struggling to get by exempt from getting a credit?

Secondly, the opportunity to refinance directed at those at the brink of foreclosure is once again a practical approach. After all, if people are able to keep their homes then it probably benefits everyone including the owners, banks and the neighborhood. Yet refinancing loans is an expensive ordeal and banks are being rescued by the TARP plan, so somebody is floating the difference - notably, you the responsible taxpayer. What is mostly bothersome though, is that an opportunity to refinance is available to those risking foreclosure and those unable to make payments. What about the rest of us who dare not miss a payment (if we care about our credit history) and were responsible? We need not apply. As a personal story, my bank misplaced a credit card payment totaling a massive $55 and without much hesitation reported this egregious violation to both Transunion and Experian. After admitting the problem (after 4 phone calls), they refunded the late charges and apologized, but informed me that the credit agencies were my own problem now and I had clear up the issues. Great, thanks for the service after 4 years of timely payments. Long story short, my credit history dropped to a reprehensible 680 and I was informed by my mortgage broker than I should wait before refinancing or suffer up to .5 point deduction! So missing mortgage payments and being on the brink of foreclosure is a path towards refinancing, but a double digit missed CC payment renders me ineligible? Why are average Americans who are merely trying to get by so vilified in this country? But my personal qualms not withstanding, according to the Comptroller of the Currency, 58% of refinanced loans fell delinquent within 6 months anyway! Danger, government at work (thanks chris_bdba).

Lastly, let us take a look at all the provisions directed toward housing in the 2009 Economy recovery act, aka New Deal part Deux, aka the Obama presidency.

Public housing capital improvements: $3,000,000,000
Public housing renovations and energy conservation investments: $1,000,000,000
Native American housing block grants: $510,000,000
Community development funding: $1,000,000,000
Emergency assistance for the redevelopment of abandoned and foreclosed homes: $2,000,000,000
Additional capital investments in low-income housing tax credit projects: $2,250,000,000
Homelessness prevention and re-housing: $1,500,000,000
Assistance to owners of properties receiving section 8 assistance: $2,000,000,000
Grants and loans for green investment in section 8 properties: $250,000,000

13.5 billion directed to section 8 housing, low-income and public housing. 13.5 billion from American taxpayers and their children going to people who most likely pay no federal taxes anyway. 2 Billion of which is going to abandoned and foreclosed homes, courtesy of the very same 4 or 6 million who failed to avoid being bamboozled by vicious bankers and predatory lending practices (not sure how the other sneak 295M got away from them). I want to avoid sounding heartless and lacking compassion, there are probably many people who truly deserve and need public housing assistance. However where are provisions for those individuals making right decisions? We don't need a tax break? We can't lose our jobs? We are not hurting in this recession? Yet we are asked to foot the bill for these so-called stimulative measures? This is 13.5 billion alone that have as much to do with stimulation as this entry has to do with short. If we are being asked to rescue every single American who made a tragic decision, can we not at least receive some assistance in these hard times? Instead, the "tax relief" promised by Obama penalizes anyone making more than 75,000 - which in case you are not familiar is hardly a lot of money in the East and West coasts. To add insult to injury, the package contains a modified 8,000 tax credit for new home owners and a clause that this credit need not be paid back! Once again, not existing home owners that could use it, but those that are getting a much better deal than anyone in the past 2 or 3 years.

War is being waged on a majority of hard working responsible Americans. Call me old fashioned, but I do not believe that this country amounted to greatness due to punishing and robbing those that do everything right only to reward those that did everything wrong. A trend like this cannot continue and must not continue, America's stability depends on it.