What Happened To The Concept of Personal Responsibility?

I’m a big fan of the concept of personal responsibility.  If I make poor decisions, I expect to be responsible enough to handle the consequences without the prospect of being insulated from them.  The recent string of government bailouts has convinced me that the government is not willing to allow anyone to fail or suffer from poor decisions, particularly in the business world.

But today, I’m not focusing on corporate responsibility, but that of personal responsibility, so I would like to concentrate on the home mortgage issue.  When the whole sub-prime mortgage mess blew up, I couldn’t help but ask myself the following questions:

1. Why would banks approve lending such risky loans to obviously risky individuals?
2. Why would people take out mortgages they clearly could not afford?

Banks share responsibility for this mess as much as those individuals who took out these mortgages.  I don’t understand why banks would even approve risky loans to risky people.  I also don’t understand why people would assume mortgage payments that they couldn’t afford.  And then, when a crisis emerges because of these terrible loans, banks and individuals expect to be bailed out for their poor decisions, and homeowners are encouraged to not leave their homes, even though they are delinquent on payments.

In this case, when individuals clearly have made poor financial decisions, why should the government be responsible for fixing their problems?  Why can’t they accept the consequences of making a poor decision?  Same thing with the banks, as they share equal blame here in my opinion.  Why, why, why, issue risky loans to risky borrowers?  It does not make sense to me.  And then to have the government provide the banks TARP money to avoid bank failures?  Now do I think that those who bank with these troubled institutions, that have met all their financial obligations, should lose their money because their bank didn’t make sound financial and business decisions, no!  However, I do feel that if banks make poor decisions that they should be allowed to fail.  As much as I think those who bought homes they couldn’t afford should not receive assistance from the government.

Plus, is it such a foreign concept to pay more for something than you can afford, especially when you’re talking about a large investment such as a home?  If I can only afford $1,000 a month for a mortgage, I’m not going to get a mortgage for $1,400 a month.  Why?  Because I won’t be living there for very long and I would expect to lose my home because I don’t make enough to satisfy the financial obligation.

But the government doesn’t believe in that.  They believe that people should not be held accountable for their poor decisions, that the government should serve as a safety net.  With that being said, my largest fear, going forward, is that everyone is going to feel entitled to government assistance no matter how much they fail.  Being responsible for one’s actions is what makes us adults.  I feel that with continued government bailouts, we are saying that the government won’t let you fail and learn from your mistakes, because you have a safety net, so let’s encourage poor decision making.

It frightens me so much that the government won’t allow people to be responsible for their actions and that it’s ok to be dependent on the government to bail out people.  It’s a scary precedent because the direction our country is moving is complete dependence on the government to solve all our problems, and that will result in big brother being involved in all our daily decisions because WE CAN’T BE TRUSTED TO MAKE THE RIGHT DECISIONS.