Sub-Prime Mess

(FreedomWorks) Congress is falling over itself in the rush to bail out speculators in America’s mortgage and real estate markets. The House has already passed a sweeping new regulatory bill and Senator Hillary Clinton is proposing a $5 billion taxpayer fund to pay individual mortgages. These proposals come despite the fact that there is little or no economic case for government intervention, and polling shows that a majority of homeowners do not support a bail out.

Most of the policy proposals before Congress would arbitrarily rewrite private contracts, reward speculative lending and borrowing, and expose taxpayers to additional risks.

Those of us old enough to remember Nixon’s disastrous “wage and price controls” of the early 1970’s also remember that it pent up inflationary pressure that exploded into double-digit inflation by late 1970’s under Carter. Where is the constitutional authority to set prices, wages or in this case, nullify private contracts?