Who gets to define rights?

What’s shocking (to me) about the clamor to “save people’s homes” (see M. Simon’s earlier post) is that in many cases, they’re trying to “save” people who owe more than the house is worth.
I think it is economically dishonest to talk of “saving” homes in this context. When someone is allowed to walk away from a loan in excess of the property valuation, he is the opposite of a victim.
To illustrate, suppose I had bought a house with a $350,000 taxpayer-guaranteed mortgage, and the house is now worth only $250,000. I’m financially screwed, and I’m on the hook — in a bad way. I’d be far better off renting.
If the bank is willing to let me walk away from the indebtedness (or will allow a short sale, which many do) I’d be ahead $100,000.
Being able to walk away from a bad investment and have the debt forgiven is hardly victimization. (It is even considered income by the IRS, although there’s legislation pending to change that.)
How the left and the MSM are able to spin as victims people who manage to walk away from legitimately incurred debts is beyond me.
I used to think that buying a house was a big decision fraught with risk — something to be engaged in by responsible adults. That contracts were binding, you should read them carefully, etc.
Something must have changed.
I think it might involve the profoundly evil meme that “housing is a right.” I say “profoundly evil” because such a “right” cannot exist except at the expense of other people.
From where derives the idea that anyone has the responsibility to provide housing for anyone else? I’m not saying people who cannot care for themselves because of disability or mental incompetence should not be cared for, but there’s a huge difference between that and defining housing as a “right.”
Of course, it’s easy for libertarian cranks like me to prattle on about how “we” don’t define housing as a “right” here in the free United States.
Many of “us” do. And they vote.
Quite incidentally, the United States adopted the Universal Declaration of Human Rights as part of its support for the United Nations. Article 25 provides as follows:

1. Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.

Fortunately, this is not binding on the United States as would be a treaty, so it cannot be enforced.
In her “Address to the United Nations General Assembly On the Adoption of the Universal Declaration of Human Rights,” US Ambassador Eleanor Roosevelt said this:

….my government has made it clear in the course of the development of the Declaration that it does not consider that the economic and social and cultural rights stated in the Declaration imply an obligation on governments to assure the enjoyment of these rights by direct governmental action. This was made quite clear in the Human Rights Commission text of article 23 which served as a so-called “umbrella” article to the articles on economic and social rights. We consider that the principle has not been affected by the fact that this article no longer contains a reference to the articles which follow it. This in no way affects our whole-hearted support for the basic principles of economic, social, and cultural rights set forth in these articles.
In giving our approval to the Declaration today it is of primary importance that we keep clearly in mind the basic character of the document. It is not a treaty; it is not an international agreement. It is not and does not purport to be a statement of law or of legal obligation. It is a Declaration of basic principles of human rights and freedoms, to be stamped with the approval of the General Assembly by formal vote of its members, and to serve as a common standard of achievement for all peoples of all nations.

I guess it should be comforting to know that even Eleanor Roosevelt recognized that there is no “right” to housing in the United States.
Needless to say, the US faces ongoing criticism like this for its failure to recognize what amounts to an obligation as a “right”:

The refusal of the United States to recognise the right to housing is of course symptomatic of a wider problem in the international community which arises with the tendency to give a higher priority to civil and political rights over economic and social rights.

I suspect this is something that Obama would like to change.
Consider the following proposals from his Democratic colleagues:

Proposing an amendment to the Constitution of the United States regarding the right of citizens of the United States to health care of equal high quality (Jackson, D-IL)–H.J.Res. 30. Creates a constitutional right to equal health care.
Proposing an amendment to the Constitution of the United States respecting the right to decent, safe, sanitary, and affordable housing (Jackson, D-IL)–H.J.Res. 32 and Proposing an amendment to the Constitution of the United States respecting the right to a home (Rangel, D-NY)–H.J.Res 40. Creates a constitutional right to housing.
Proposing an amendment to the Constitution of the United States respecting the right to full employment and balanced growth (Jackson, D-IL)–H.J.Res. 35. Creates a constitutional right to full employment.

(Links added; more here.)
Considering that Jackson is Obama’s national campaign chair, I think it’s worth asking Obama how he defines rights.
But just as the word “socialism” is taboo, some questions can never be asked.
MORE: Suppose a clear majority of Americans decide that there is a “right” to property at the expense of others. Founder James Madison cautioned that what a majority might want is not necessarily an ideal standard:

There is no maxim, in my opinion, which is more liable to be misapplied, and which therefore, needs more elucidation than…that the interest of the majority is the political standard of right and wrong. Taking the word “interest” as synonymous with “ultimate happiness,” in which sense it is qualified with every necessary moral ingredient, the proposition is no doubt true. But taking it in the popular sense, as referring to immediate augmentation of property and wealth, nothing can be more false. In the latter sense, it would be the interest of the majority in very community to despoil and enslave the minority of individuals; and in a federal community, to make a similar sacrifice of the minority of component States. In fact, it is only re-establishing, under another name and a more specious form, force as the measure of right….
Letter to James Monroe, Octr 5th, 1786

Tyranny by the majority is still tyranny.
It’s comforting to know that such things were on the minds of the founders.


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6 responses to “Who gets to define rights?”

  1. Assistant Village Idiot Avatar

    “How the left and the MSM are able to spin as victims people who manage to walk away from legitimately incurred debts is beyond me.”
    Easy. They aren’t rich. Other people are, including some unpleasant ones. Therefore they are victims.
    Facts don’t matter to these people. Only the narrative matters.

  2. Ron Hardin Avatar

    I don’t understand mortgages, I guess. If the house collateralizes the debt, why don’t you have a “put” on the underwater debt, in effect, by walking away?
    It’s just that it seems to me that that’s the deal that has been struck, and that’s one of your options under it.

  3. Eric Scheie Avatar

    You owe whatever amount of the loan is, and are obligated to pay it off. In the event of foreclosure, the difference between the loan balance and the sale price (if lower than the amount owed) is called a “deficiency,” although many states have “anti-deficiency statutes” to allow borrowers to avoid owing that. Under such circumstances, it is obviously in the interest of lenders to wait and hope the market will improve and the borrower will get back on track. But in many cases, there’s little incentive. Lenders were making loans (110% was common) above the value of the home even when the market was booming. Now they’re screwed. I can remember when 80% was the rule, credit and income were verified, and none of the downpayment could be borrowed.
    Between the CRA, the 1995 revision, ACORN, plus securitization, a perfect storm was created.

  4. LibEvan Avatar

    If the $100,000 is forgiven, as in the scenario you put forth, the (former)homeowner will owe taxes on 100K worth of capital gains. Yes, he’d still come out ahead, but a lot of these people don’t have the cash flow to be able to pay the taxes.

  5. TallDave Avatar

    Have any real people who are creditworthy seen any kind of credit crunch?
    My little business has $100K+ in untapped credit lines and I’m not hearing a peep.
    As best as I can tell, the only people affected are those that shouldn’t have been given loans anyway, and the people who have been loaning them the money.
    This sums up the bailout nicely.

  6. Bob Smith Avatar
    Bob Smith

    Yes, he’d still come out ahead, but a lot of these people don’t have the cash flow to be able to pay the taxes.
    You probably won’t have to pay the tax in a lump sum. The IRS is very flexible if you come to them first rather than put your head in the sand. Negotiating a payment plan isn’t hard if you can show the IRS you need it. Plus you aren’t paying a big mortgage anymore, so your cash flow situation should be improved.