National Public Radio has hopped on the media bandwagon of advocates of just walking away from a house that’s underwater, i.e., worth less than the mortgage.
NPR aired a story this morning that justified and gave credence to the view that the one-third of all home owners across the country who owe more on the property than it is currently worth should just walk from their mortgages, especially those who can afford to keep paying the monthly note.
The reporter did articulate the position that people have a moral obligation to pay their debts if they can, but it was clear that his sympathies were with the walkers. For example, he identified the University of Arizona study that says that on a cost-benefit analysis, more people should be walking away from their mortgage. Now anyone who heard the story (or read this blog) can get the survey online with a little effort.
But for the study he references showing that 4 our of 5 homeowners think it’s immoral to walk away from a debt if you can pay it (and thank goodness for that!), he provides no citation whatsoever. The listener has no idea who said it or how to find it.
Press releases about hundreds of studies come out each week and the news media determine which ones they will insinuate into public consciousness and which ones they will lay on the gargantuan academic trash heap. So when the news media picks up on some and not others, we have to ask: why? Why are NPR, the New York Times and other mainstream media giving so much ink to the odious idea of walking away from a debt you can pay?
Again, I believe it’s because they are representing the interests of investment banks and the real estate industry, which instead of being regulated would prefer for the average person to adopt their immoral ways, which include such odious but evidently legal actions as securitizing mortgages that they know are bad and then selling them to an unsuspecting public. Or how about his one: creating special companies for investments so that they can walk away if it goes south and make their partners—investors all—bear most of the cost.
I wonder if the media trying to goad people into walking away from their obligations realize that once people learn to walk away from the place in which they play out their private dreams that they’ll be able to walk away from every other kind of obligation with a free conscious. The result could be a significant breakdown of our economic order or a descent into an all-cash society.