Lerner's plan is to organize a mass, coordinated "strike" on mortgage, student loan, and local government debt payments--thus bringing the banks to the edge of insolvency and forcing them to renegotiate the terms of the loans. This destabilization and turmoil, Lerner hopes, will also crash the stock market, isolating the banking class and allowing for a transfer of power.
What's wrong with this?
Look when you take out a mortgage, you sign a contract. The contract says you will pay $X for Y period of time or the bank has the right to come take the house back from you and sell it to someone else.
Ok, so what's the problem? You decide to do the second - not pay.
Before someone pipes up and says "but that's immoral!" let me point out that the Mortgage Bankers Association themselves did the same thing. They "jingle mailed" their headquarters building, which they bought and then dropped in value.
So maybe Beck can explain why there's something wrong with the SEIU organizing people into a group to do exactly the same thing that the very trade association representing these bankers did?
I have long argued that the proper thing to do is make a decision on whether you should pay or intentionally default based on your personal circumstances, including the potential legal and financial repercussions.
I see no reason to change that recommendation, and that the SEIU is attempting to organize people into a block to do the same thing - make a business decision on whether to pay (or not) their loans - doesn't seem to be any more troublesome than it was for the Mortgage Bankers Association.
Might this destabilize some banks? It certainly might. Is there anything wrong with that? Not from where I sit. The bank made the decision to loan the money knowing full well you might choose not to pay and if that happened they'd have to seize and resell the house. The simple fact of the matter is that you entered into a contract, and that contract contains an "or else" provision if you don't pay. Choosing to have the "or else" happen is your right and if the bank didn't like the odds on that they shouldn't have made the loan in the first place. The consequence of the decision to lend you money - whether good or bad - is entirely theirs.
Furthermore the government had every opportunity and ability in 2008 and 2009 to take these institutions into receivership. The bondholders would have been massacred. So would have the stockholders. So what? That's what failure is in a capitalist system - you fail, you go out of business, the bondholders and stockholders lose money. Would "financial Armageddon" have ensued? For whom? For Blankfein and friends? Yes, it would have. How about for the community and regional banks that didn't make bad loans and had solid balance sheets? It would have been a business bonanza unlike any other.
Since the government won't enforce Prompt Corrective Action and when faced with the facts on the bank's assets they changed the rules (see Kanjorski and friends) instead of doing what's right, what peaceful set of actions remain other than bending over and thanking them for violating you?
I continue to assert that the decision to default or not is and should be a business decision, just like it was for the Mortgage Bankers Association.
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