Fixing Dysfunctions with Dysfunctions

Sheila Bair, the head of the FDIC, is a lawyer who apparently has never held a private-sector job (afaic "Senior Vice President for Government Relations of the New York Stock Exchange" doesn't count as such). However, she knows how to solve the housing crisis: if creditors track down debtors and offer them easier terms on their mortgages, all will be well. In particular, ARMs should not be reset and teaser rates should be made permanent.

Bair is "frustrated" that creditors are not getting with the program:

For instance, for owner occupied housing where the loan is current ... just convert that subprime hybrid ARM into a fixed-rate mortgage. Keep it at the starter rate. Convert it into a fixed rate. Make it permanent. And get on with it.

Compassionate conservatism to the rescue!

The political class is running the country not by solving problems, but by offsetting them with new problems and aggrandizing power in the process. Unless we change course, the day will come when all reserves of societal capital are exhausted.