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Forgive me, Uncle Sam, for I have sinned
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Wall Street wants absolution for their financial transgressions. Detroit believes they’re too big for repentance. Those who made personal financial decisions whether it was buying a home or going on a big toy spending spree while driven by at least several of the Seven Deadly Sins want monetary forgiveness.
Way too many of us believe that we are entitled to the secular equivalent of divine intervention from Washington, D.C., to deliver us from our non-virtuous ways now that the party is over.
The no-fault attitude toward life is an epidemic that we’ve got to stop Uncle Sam from feeding with overly benevolent actions. News that in excess of 37 percent of loan adjustments made by banks to homeowners to avoid foreclosure are now in default is proof we as a nation believe we are entitled to a no-fault life.
The mortgage adjustments were made for people who could afford to make a reasonable payment. It required discipline and refraining from viewing everything as a “need” regardless of whether it is really a want.
If you’re really on edge and you want to keep your house do you need cable service, cell phones, Internet, to drive everywhere or can you afford the luxury of not watching every penny you spend?
None of us is without financial sin. But as long as we keep propping up people and institutions that refuse to change their ways, as a nation we’re no different than those who keep propping up drug addicts who are slowly destroying themselves.
America’s choice of drugs today isn’t crack. It’s easy money. We demand that we be allowed to keep partying and look to Sacramento and Washington to solve our ills when what we really need is tough love.
As long as we allow the concept of easy money and the accompanying problem of not being responsible for our bad spending decisions to flourish we will continue to eat away at American economic muscle.
The worst part is as long as we coddle those who make bad decisions and either propping them up in readjusting their debt by court or congressional edicts we will spread the disease.
Five months after I closed escrow on my first house I was hit with a 33 percent cut in pay. It wasn’t fun times. Instead of walking away I took on odd jobs and readjusted spending. I used a credit line that I had established over the years. I’m not going to lie. I ended up owing a hellacious amount of money on credit and did some of the consolidation loans through credit card companies.
In the end, it all got paid off.
Today, those who take their obligations seriously would have a hard time doing that as banks are now skittish. Who blames them? It is now the fashion to walk away from debt that you incur even after banks work with you to reduce what you owe.
Over the years I’ve committed my share of financial sins as well. The worst, by far, was spending $7,200 on a custom titanium racing bicycle in 1992. It wasn’t practical but I figured “I deserved it.” I already had a high-end steel racing bicycle that cost $2,800 plus three other bicycles. But I had to have it. It took me years to pay it off. Guess which bike I ride the most? It’s the high-end steel that is still perfectly fine and cost $4,400 less.
Fourteen months ago I was thinking seriously about buying another bicycle. I started thinking I deserved it. Then I sat down and did some serious thinking. Even though I had the $2,500 cash in the bank at the time my other bicycles were still in primo shape even though they didn’t have the latest lightweight carbon materials. I’m not a bicycle racer by any stretch of the imagination and it really wouldn’t change my performance any. I passed.
Three months later in February 2008 it dawned on me that I could actually afford to buy a house again in Manteca. Had I spent that money on a “want” that was definitely not a need, I would not be a homeowner today.
It is tough to have empathy with those who put nothing into a house they were buying, refused to live within their means as they were expecting to pull cash out of their house if they need it, and then declined to cut back after being given a second chance by the bank.
There are those who got hit by job loss, illness, divorce, or death of a spouse. But most of those who are now defaulting the second time around after mortgage loan adjustments have an entitlement attitude that is only matched by a drug addict or a generational welfare abuser.
Life is a long road. The current economic woes in retrospect will look like a dip when we look back unless we demand that Uncle Sam extend our financial follies and risk collapsing the road into a gigantic sink hole of national debt undermined by printing money out of thin air.