Day: February 24, 2009

Let’s stop blaming homeowners for our economic crisis

Politicians and pundits quickly found an easy target to pin the nation’s economic crisis on — homeowners who bought more house than they could afford.  I, for one, think we should stop blaming homeowners for bad public policy, poor government oversight, and greedy lenders.

“But,” the critics argue, “it’s the irresponsible homeowners who caused this crisis because now they can’t repay their mortgages. This creates bad debt at banks, further reducing the banks’ ability to lend.”

That argument is flawed and here’s why:

  • Homeowners didn’t package and slice up mortgages into untraceable, unmeasurable and risky economic instruments.
  • Homeowners didn’t relax the rules allowing banks to increase their debt-to-deposits ratio.
  • Homeowners didn’t run the SEC, Fannie Mae or Freddie Mac whose lax oversight and loose policies allowed the Bernie Madoffs to steal billions, and predatory lenders to defraud millions.
  • Homeowners didn’t create the shellgame called credit default swaps, a house of cards created by the lenders to provide the illusion that real “insurance” covered their loan portfolios.
  • Homeowners didn’t create the housing bubble, or inflate the market price of property, or assure others that “your house value will always go up.”
  • Homeowners didn’t rate the riskiest of financial instruments as sound and solid, like the rating agencies did.  Those same agencies are supported by the companies they rate.

No, homeowners didn’t do any of those things.  I personally know of instances where bankers encouraged borrowers to borrow more, to take out 100% loans, to apply for no-money-down loans, and to accept variable rate loans with ridiculously low initial teaser rates.

I also know families who have lost their homes during this crisis.  Families for whom the American dream came within reach while both were working, but when the husband lost his job that dream evaporated quickly.  I do not blame hardworking families for trying to better their lives by buying their own home, or by moving to a newer home in a newer neighborhood with better schools and services.

Were there abuses?  Absolutely.  Two houses down from us is a house bought under a government program by a family who never paid a penny on its mortgage, and rented the house to any and all comers.  When the bank foreclosed, it wasn’t a bank here in Chatham, or Danville, or even in Virginia.  The bank that held the mortgage on that little house in Chatham, Virginia is headquartered in Texas.  How did that happen?  Bad policy, poor financial oversight, lax government regulation, and, in that case, unscrupulous borrowers.  But let’s stop blaming all families who dreamed of a better life for the misdeeds of the few.

What does this have to do with churches?  Just this — the people who live in your communities and mine may have made mistakes, may have taken on too much debt, and may be in trouble financially.  Churches can minister to these families with solid financial training, personal support, financial help, and spiritual encouragement.

In the past few months our church has helped one family stay in the home they were going to lose, helped another family pay their rent during an illness, and found a better house with lower rent for a third.  These are real problems faced by real people who only wanted to live a better life.  Now we in churches in these communities have the opportunity to stand with them.  And when we do, we must not be tempted to explain this complex economic crisis by blaming our neighbors.  That’s my opinion, what’s yours?

It’s no longer about programs

I grew up in churches that had programs for everybody and everything.  We had programs for preschoolers, children, teens, adults, and senior adults.  And, we had missions programs, Bible study programs, training programs, music programs, and sometimes programs about programs (I am not kidding about that last one).

Well, it’s no longer about programs.  I read lots of blogs. Lots.  The trend I see is churches and pastors talking less about programs and more about helping others.  That is a good thing.  Even the Episcopalians are saying it:

For the past 25 years, since Arlin Rothauge wrote Sizing Up a Congregation, the “gold standard’ for most congregations in the Episcopal Church (not to mention churches in lots of other denominations as well) seems to have been “let’s work toward becoming a Program Size parish.”

So, if it’s such a great model, then why isn’t it working? Churches are cutting their associate positions right and left. Congregations that have languished with an Average Sunday Attendance of between 100 and 150 for the last 50 years have never “gotten over the hurdle”… despite well-meaning clergy and lay leaders; despite every new gimmick, or program, or study, or consultant they’ve tried.

So there you are.  It’s no longer about programs.  It really is about people.  That’s what it’s supposed to be about — loving God and loving others.  Pretty simple.  You don’t even need a program to tell you that.

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