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Originally Posted by RFlushDiamonds
The view that HAMP was a success isn't shared by many :
In 2009, the Treasury Department launched its acronymic homeownership-preservation program, HAMP, the Home Affordable Modification Program. It sought to keep families in their homes by negotiating lower monthly payments for people paying more than 31 percent of their income to their mortgage. Initially, the administration said HAMP would help 3 million to 4 million homeowners. So far, only 633,000 families have actually gained permanent loan modifications, with about 800,000 kicked out during the program’s “trial period.”
The purpose of programs like this isn't to help everyone. Not everyone needs help, not everyone deserves help and not everyone can be helped. An indiscriminate bailout of homeowners would have been even more problematic from the perspective of equality - homeowners are on average better off than non-homeowners. The point is to stabilize the market so that the program isn't needed. And they succeeded.
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In some cases, the banks’ own modification programs have proved better than the government’s.
This is the whole point of programs like this - the system was saved and it started working on its own.
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Also, as no one was made an example of and jailed
Who should've been jailed that wasn't? Let's say Wall Street was criminally liable for buying, packaging, selling and holding loans that were obviously fraudulent. What do we do with the borrowers that defrauded the lenders in the first place and mortgage brokers that were more directly involved in these frauds? It's likely that actual felonies were disproportionately committed by average people as opposed to Wall Street.
At worst, Wall Street was the middleman and when they were found to be insolvent due to holding on to so many fraudulent loans, they were the victims. The prevailing narrative aside, it's the borrowers that defrauded the lenders (and indirectly, Wall Street), not the other way around. It was a massive wealth transfer from Wall Street (in the sense of the investor class) to Main Street. This isn't a politically appealing narrative, but this is where you end up if you follow the money.
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banks that claimed to be 'too big to fail' weren't broken up, nothing has really changed.
It's not individual banks that were too big to fail - it was the system that was too big to fail. Breaking up banks does nothing to address the systematic risks and arguably makes the system even more fragile. Having lots of domino tiles isn't exactly the saving grace when they all start to fall one by one.
Your entire criticism is in some sense the proof that generally good decisions were made. In the same sense that if you organize the working class and they later become comfortable enough to become status anxious about those below them, start to vote against their own economic interests, you've won and it's time to move on to the next group. In the same sense that, in the aftermath of a potential pandemic, if people criticize you for reacting too aggressively to something that wasn't as bad the flu (and how it was unfair or cost them or whatever), you've won. If you do a good job of managing a crisis, the people you helped save won't be appreciative and won't even know what it is that you saved them from.