McCain’s (not so crazy) bet on housing

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The NYT has an article today contrasting John McCain’s views on the housing crisis with those of Hillary Clinton and Barack Obama. It begins:

SANTA ANA, Calif. — Drawing a sharp distinction between himself and the two Democratic presidential candidates, Senator John McCain of Arizona warned Tuesday against vigorous government action to solve the deepening mortgage crisis and the market turmoil it has caused, saying that “it is not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers.”

Mr. McCain’s comments came a day after Senator Hillary Rodham Clinton of New York called for direct federal intervention to help affected homeowners, including a $30 billion fund for states and communities to assist those at risk of foreclosure. Mrs. Clinton’s Democratic opponent, Senator Barack Obama of Illinois, has similarly called for greater federal involvement, including creation of a $10 billion relief package to prevent foreclosures. …

Clinton’s response to McCain’s words: “It sounds remarkably like Herbert Hoover, and I don’t think that’s good economic policy.”

I dunno. Herbert Hoover’s economic policies probably would have worked fine in 1924. They just weren’t up to the greatest financial and economic crisis of the 20th century. And I wonder if McCain is simply making a calculated bet that this won’t turn out to be one of the big crises of the 21st.

If the economy holds up well enough that a more or less status quo (on the economy) Republican candidate can still get elected in November, then McCain’s hands-off approach will probably make more sense than the activism of Clinton or Obama. If things keep getting worse then, well, it’s not going to be his job to deal with it.