February 20, 2009
Fox News interviewed Professor Richard Green about homeowners who are frustrated that the government is bailing out people who took risks and not helping those who were responsible. Such frustration is justified, but the economic risk of letting millions of homeowners default on their mortgages leaves the government with little choice, Green said. "A year ago I would have been appalled at this plan," Green said. "Now I think we have to do something like this. The moral hazard argument is valid, but is trumped by the macroeconomic situation." Green is director and chair of the USC Lusk Center for Real Estate.
Fox News interviewed Professor Richard Green about homeowners who are frustrated that the government is bailing out people who took risks and not helping those who were responsible. Such frustration is justified, but the economic risk of letting millions of homeowners default on their mortgages leaves the government with little choice, Green said. "A year ago I would have been appalled at this plan," Green said. "Now I think we have to do something like this. The moral hazard argument is valid, but is trumped by the macroeconomic situation." Green is director and chair of the USC Lusk Center for Real Estate.