McCain’s retreat on mortgages

April 11, 2008

A strategic (and economic) error or just the acceptance of the inevitable?

McCain has succumbed to the criticism that he has received from the left and revised his mortgage plans to include a limited number of bailouts for individuals. On the face of it, this is not too bad as government assistance will only be extended to those for whom the house in question is their primary residence and who afford the revised mortgage payments. It also goes without saying that it is miles better than the handouts to the feckless, many of whom got rich off the boom period, than Obama and Clinton have proposed. It is also worrying that has said, “My plan follows the sound economic principle that when markets decline dramatically, debts must be restructured”. Indeed, such a doctrine could be used to justify every instance of taxpayer handouts for failure, irrespective of genuine need or culpability.

However, what is more worrying is that he has had to change his position in response to pressure rather than stand up and fight his corner. If there was one lesson McCain needs to take from his dramatic collapse and his subsequent rise-from-the-ashes it was that people are willing to led only if one is willing (and able) to lead them. While his new policy may superficially be more centrist than his old one, such handouts will mean less money (and political capital) to use to addresses the problems in the American educational system and social exclusion without over taxing those who ‘work hard and play by the rules’. While this new policy may not be as controversial as the old one, and McCain needs to move to the centre on other issues, this is one change that he could have done without.

What do you think? Please leave your comments below.


One comment

  1. McCain will be making a series of concessions to the Democrats through the year because it’s the only way he can pass himself off as a viable candidate. First it’s the housing crisis, then it’ll be the economy, then health care, and then abortion, and then PA… and then it’ll become clear to all that McCain is nothing more than a pro-war liberal.

    This is one of the reasons why so many Republicans refused to vote for him in the spring: McCain couldn’t be trusted as a true conservative because he always has and always been moderate. This may play well in the general, but it’ll be devastating for party unity. I think any Republican would rather lose one election in 2008 than see their entire agenda off the table for a generation.

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