I don't care about the banks, that is a separate issue. There is a competitive market for loans. Making it effectively cheaper to default on a loan will subsidize people who default, at the expense of people who do not.

I am saying that we should not be transferring money from people who choose to default over those who do not. We should be transferring money from people who are wealthy to people who are not. Which is what taxation and welfare does.

Try to focus on what I am saying rather than the bad guys that you falsely assume I represent.

>Try to focus on what I am saying rather than the bad guys that you falsely assume I represent.

My apologies. I did mis-read the link that you were drawing between people who owe money and the poor; or rather, that your very point was that there is not necessarily a link.

I don't agree with your conclusion, however, as there is a large and growing swath of people who may not be "poor" enough to receive welfare per se, but who struggle financially and are in over their heads. That may well be largely who we are talking about here. So, my confusion came in because I hadn't linked what you were de-linking in the first place. That is, I don't see this as a scheme to bring equity to poor people who are already served by welfare and other transfers under the tax code.

So, let me rephrase. Why is it that we use value-judgment loaded phrases like "misplaced sympathy" to describe people who owe money? And, why do we emphasize fears of market distortion and moral hazard produced by debt-forgiveness so much more than for bailouts, corporate welfare, outsized CEO pay, etc.?

I have nothing against taking a person's debt into account when deciding on matters of welfare. Bankruptcy is one option, but maybe the government should sometimes help people who would otherwise face bankruptcy.

My problem is with equating debt, as opposed to poverty in general, with being owed support by others. Hence the "misplaced sympathy". We do need to encourage responsibility while at the same time looking after people no matter what situation they find themselves in.

On your final point, there is no "we". On bailouts, there was no other option (from the point of view of the people making the decision). I already pointed to tax and welfare as another option for helping poor people. On corporate welfare and CEO pay these are not really anything to do with moral hazard so I don't know what your point was.

>My problem is with equating debt, as opposed to poverty in general, with being owed support others.

Again, "owed support" seems to carry some sort of moral judgment. What does it mean? Perhaps you can qualify that. I mean, are you trying to say that poor people are "owed support" because poverty is more systemic and cyclical, while debt is viewed as more of a choice? Because, I would argue that the latter is not nearly as clean as that.

But, kudos that you seem to realize this to some extent and are now allowing (or clarifying) that perhaps some indebted people are deserving of help vs. lumping them all into the "unworthy of sympathy" bucket.

>On corporate welfare and CEO pay these are not really anything to do with moral hazard so I don't know what your point was.

That's why I wrote "market distortion and moral hazard". These would be examples of the former. Outsized CEO pay does not exactly suggest a meritocracy in our labor market (especially when the CEO has driven his company over a cliff). Likewise, corporate welfare isn't exactly free-market activity.

The overarching point is that we seem to be hell-bent on accountability, personal responsibility, protecting the markets, etc. when it comes to individuals to the point where it rises to the level of morality judgments. But, we allow corporate welfare, bailouts, outlandish CEO pay etc. with barely a peep.

For instance, people are taught that walking away from a mortgage on a home whose value has plummeted is dishonest and basically evil. But, deliberately creating and selling bad debt and leveraging it ad infinitum to enormous profits not only slides by with merely a few grumbles, but the perpetrators are handsomely rewarded and are the very people to whom the debtors are supposedly morally accountable. It's a crazy double-standard.

So, when someone comes along and proposes to help individuals as the OP did, we start pontificating about the perils of distorting the market (which is already grossly distorted), and we try to carefully parse out who is "deserving", etc.

It's ridiculous, really. And I am suggesting that when people toe this party line, they are supporting this inequity, even when it is not their intent.