Research

Obama’s “Throw Money At The Problem” Strategy Fails Again

March 2010

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In 2009, the Obama administration diverted $50 billion from the TARP bailout fund to be used to modify the home loans of a portion of the 8 million Americans facing foreclosure. The intention was for the government to step in between banks and homeowners behind on their payments and prevent foreclosures by arranging for better terms on behalf of borrowers. As Rene Merle at the Washington Post reports, Obama is having trouble living up to those promises:

The Treasury Department initially said the program, known as Making Home Affordable, would reach as many as 4 million struggling borrowers. But Neil Barofsky, special inspector general for the Troubled Assets Relief Program, said in a report issued Tuesday that Treasury now expects only 1.5 million to 2 million homeowners to get mortgage relief. . . But so far, fewer than 200,000 borrowers have received permanent loan modifications.

This is yet more evidence of why the Obama Democrats’ philosophy of “more government is the solution” doesn’t actually solve problems, and in some cases makes things worse. Now, Obama’s Treasury Department is attempting to move the goalposts and begin counting homeowners that receive trial offers to enroll in the program in their tallies - regardless of whether they were ultimately able to prevent a foreclosure or not. Barofsky disagreed with that methodology and chided the Treasury for attempting to change the terms of success:

“Defining success by how many offers are given can reasonably be perceived as essentially meaningless,’” Barofsky wrote, adding that the program's goal “must relate to how many people are helped to avoid foreclosure.”

As America gets ready to swallow Obama’s $2.5 trillion dollar take-over of health care, enjoy this reminder that Democrats do not measure the success of their runaway government spending based on their promises but only by their intentions.

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