A Veneer of Certainty

So sayeth the Texas House. HB 2685 by Rep. Chisum, R-Pampa, a bill that proposed an increase in marriage license fees paid by couples unless they take a prenuptial “marriage education” course, was shot down today. The bill would have also changed the divorce waiting period to two years unless couples attended another “marriage crisis” class in order to qualify for the 60-day period.

The House agreed with [Rep. Senfronia] Thompson to roll the fee back to $30 on a vote of 76-61. A couple could still avoid paying the $30 licensing fee by instead applying for a grant to pay for the counseling class, but the incentive of avoiding a $100 fee is minimized.

"Evidently the House floor is not interested in helping marriages stay together,"said a disappointed Chisum.

Republicans used to be the party of smaller government, but this latest misguided attempt to reach into people’s personal lives really ticks me off, and it smacks of the “defense of marriage” canard that gets played every once in awhile. Chisum is the same guy who not long ago jumped on the evolution-as-religion bandwagon and authored the bill to outlaw abortion in Texas should Roe v. Wade be struck down.

I fail to understand how a quick counseling session is going to make the slightest bit of difference to two people in the process of forging – or breaking – a marriage commitment. So far, the state’s only involvement in process is the civil contract itself, and the state of Texas has no business meddling in the interpersonal aspects of it.

Rep. Chisum is obviously a man of strong faith, but I wish he’d keep it to himself.

State Sen. Dan Patrick is in rare form. Off the Kuff has a nice analysis of Patrick's shenanigans during budget debate. It's ridiculous that he'd wait until the budget is out of committee to bring up $3 billion in cuts and even then release that info only to the media. His duties to the senate - and by extension, the state - trump using these cuts as talk radio fodder.

After the Joseph Welch-like beatdown by Sen. Whitmire, it is kinda obvious that Patrick's gamesmanship is self-marginalizing. The more Patrick antagonizes the senate, the fewer bills he'll be able to push, and the better off we'll all be.

Long ago, in a neighborhood far far away, I asked my mom for a loan of a couple bucks so I could buy a balsa plane (with rubber-band, windup propeller!). I promised to pay her back via various extra chores, but for one reason or another those additional duties just never got done. Oh well. Now, she may have assumed that it was unrealistic that I would pay her back but she forked over the cash just the same.

Now there’s governmental talk of a bailout for subprime lenders and borrowers. This seems like a very bad idea for at least a couple of reasons.

Lenders knew (or should have known) the risks inherent in loaning money to people with “less than perfect” credit histories/ratings. In some cases funds were provided even without verified income. They took that risk because a combination of high rate of return and a record-low cost of credit. A bailout for the subprime lenders is tantamount to government subsidy of bad investment moves. In addition, the securitizing and sale of packages of these high-risk loans only served to create a financial instrument to pass on the risk. Should purchasers of these securities get a bailout? Of course not. They should have known what *they* were doing, too.

The faults borne by subprime borrowers are, I think, a mixed bag. Certainly some were dazzled by promises of home ownership beyond their expectations. But therein lies the rub: how much home did they reasonably expect they could afford? I believe part of this is due to the very low value our society places on good fiscal stewardship. We’re more focused on material gain with little to no thought as to financial discipline. A few years ago when easily-available credit cards rained down from above, a goodly number of people went out and charged themselves into receivership, without thinking about the inevitable bill. For the government to now provide a safety net for borrowers’ poor fiscal planning will only create an incentive for those borrowers to default on their already shaky debt.

My $.02: Let the subprime mess fall down. In the long run we'll hopefully learn something from the ugly shakeout and be better stewards of money.

The body language from both men is very telling. Whitmire is aggressive, using up his floorspace and often extending his arm; seems really confident or really pissed off, maybe both. Patrick often turns away from Whitmire (true, his desk is behind him) as if to avoid the onslaught. The List is used almost like a shield or distraction.

(h/t to PinkDome)

A bit of followup from my previous post on the possibility of subprime bailout.

Several states are looking into bailout hybrid arrangements involving private sector refinancing of subprime mortgages in – or due to – default, backed by bond issues. The Maryland program provides a state-brokered refinancing via commercial lenders, targeted to lower income borrowers, where…

[a]fter the approved private lender puts together the new loan, it bundles it with others and sells them to the agency, which uses cash from a bond issue to buy the bundled loans.
The goal is that state coffers would not be used - the state hopes to pay off those bonds with the interest it collects from borrowers.

Federally, Freddie Mac will be implementing its own program to facilitate refinancing for subprime borrowers. Some smart & responsible features of the plan are the tightening of borrower’s documentation requirements and the requirement of lenders to qualify at a fully-amortized rate, restricting the influx of further risky debt. The odd part is that Freddie Mac is one of the repackagers/issuers of mortgage-backed securities, which in my estimation is part of the subprime problem.

Helping borrowers avoid default can be a very good thing, especially with some fiscal discipline learned along the way. The political cost should states be forced to cover defaulted refinance… that’s a good question. Time will tell.