Mona Charen

In March of this year, the Obama administration, tacitly acknowledging HAMP's failure, proposed new rules that would give jobless homeowners a three-month break on mortgage payments and offer more incentives to lenders to modify mortgages.

While the administration had boldly predicted in 2009 that HAMP would save 3 to 4 million homeowners, only 434,716 had seen their monthly payments permanently lowered as of July. A much larger number, 616,839 were booted from the program during the same period, usually for failing to make payments on time. As the Los Angeles Times noted in March, "The modifications, while delaying the foreclosure process, did not appear to be a long-term solution. About 52 percent of those with modified loans defaulted again after nine months."

Neil Barofsky, the special inspector general for the Troubled Assets Relief Program (SIGTARP for those who speak Washingtonese) blasted the program in a July report:

"Treasury's refusal to provide meaningful goals for this important program is a fundamental failure of transparency and accountability that makes it far more difficult for the American people and their representatives in Congress to assess whether the program's benefits are worth its very substantial cost.

"The American people are essentially being asked to shoulder an additional $50 billion of national debt without being told, more than 16 months after the program's announcement, how many people Treasury hopes to actually help stay in their homes as a result of these expenditures, how many people are intended to be helped through other subprograms, and how the program is performing against those expectations and goals. Without such clearly defined standards, positive comments regarding the progress or success of HAMP are simply not credible, and the growing public suspicion that the program is an outright failure will continue to spread.

In contrast to the Obama morality play, the foreclosure crisis was not a conspiracy of the rich and powerful against dutiful homeowners reliably making their monthly payments. It was the result of multiple follies by government, bankers, and individuals. Obama's instinct to insulate people from the consequences of their bad decisions (and yes, sometimes bad luck) amounts to subsidizing failure. The results are coming in daily -- persistent high unemployment, an anemic recovery, and billions upon billions of wasted taxpayer's money.

Mona Charen

Mona Charen is a syndicated columnist, political analyst and author of Do-Gooders: How Liberals Hurt Those They Claim to Help .
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