Some of the folks who helped bring about the partisan gridlock in D.C. that led to a federal government "partial shutdown" now want banks to step into the breach and make things better for those affected by the intellectual and moral bankruptcy of our political class.
Rep. Maxine Waters, D-Calif, spearheaded a concurrent resolution, along with 30 other policymakers, urging institutions such as banks and consumer reporting agencies to work with customers affected by the shutdown.
"The shutdown of the federal government has forced thousands of people into financial distress through no fault of their own,” Waters said. "Financial institutions should not penalize — or profit from — those affected by these difficult circumstances."
The proposal calls on institutions to identify customers affected by the government halt and asks the entities to adopt flexible arrangements to help borrowers meet debt obligations.
Among those "flexible arrangements" is forbearance for late payments, including waiver of late fees and penalties.
"Every day, I am hearing from federal workers from across my district about the financial hardships they are facing due to this government shutdown," stated Congresswoman Donna F. Edwards, D-MD.
She added, "For federal workers who have experienced three years of a pay freeze, and sequestration that forced many to take unpaid furloughs earlier this year, they should not be penalized now by their financial institutions due to circumstances beyond their control."
"Penalized"? That's stretching the victimization mentality to the point of near insanity. If they miss a payment and get hit with a late fee and/or default interest, that's what called getting exactly what you bargained for in the agreement you signed. People have lost their jobs by the boatload since 2008 because the economy hit an iceberg. I guess federal employees are entitled to special treatment, though, particularly when the cause of their unemployment woes is the inability of politicians in both parties to understand that politics is the art of compromise.
"Forbearance" was a dirty word for people like Waters and Edwards when community banks were hit by an economic tsunami in late 2008, a circumstance "beyond their control," and a circumstance due, in no small part, to failed federal government policies promoted by people like Waters to make maximum amounts of credit available to people with insufficient incomes to actually pay it back. As Kevin LaCroix recently noted, FDIC lawsuits against former officers and directors of failed banks are proceeding at a blistering pace because community banks failed at a blistering pace in 2010. No cries from members of Congress for the FDIC to cut them some slack could be heard at that time.
You couldn't write fiction that included characters this cynical and hypocritical. No one would believe it. Unfortuantely, in real life, truth is often stranger than fiction.
Incidentally, credit unions and community banks were offering assistance to furloughed federal employees before cycnical pols like Waters and Edwards opened their well-glossed pie holes. The last thing in the world that a small business, with its finger firmly on the local pulse, needs is a Washington, D.C. political hack telling them to "do the right thing."