In addition to frequent searches that lead people to an earlier posting on “monoculture” on my site “What I Saw in America,” among the most frequently searched words that bring people to another of my postings is the effort to find information on the firm “Walkaway.com.” This company – and others like it – provide legal and practical advice on how to abandon your “home” and the mortgage that you agreed to repay. Sadly, this remains an oft-visited posting, mainly because people believe that it provides information on how to get in contact with this company. Here’s what I wrote on my site on January 30, 2008:
A new trend to keep an eye on: businesses based on the premise that growing numbers of people will rather choose to ditch their devalued houses rather than pay their inflated mortgages, which it turns out, were huge bets that such leveraged “investments” would reap mind boggling dividends. Absent this expected if unjustified return on investment, the houses are just now so much worthless detritus to be thrown in oversized trashbins.
One can hardly be surprised at the vulture economy that will spring up as the carcasses begin to putrefy. However, what is most arresting for me in this posting is the growing evidence of shamelessness among our middling debtor class, a vice that can be itself directly traceable to the elites of our society, in particular those quasi-aristocrats who were the trustees and caretakers of our society and its norms. These people of visibility and distinction in settled communities – established businessmen and storekeepers, attorneys and doctors, clergy and civic figures – have reneged their status as responsible keepers of their community and as conveyors and exemplars of its norms, and now ironically are reaping the harvest that they have sown.
Here is an exchange between Steve Croft of Sixty Minutes and a real estate agent who has been witnessing these “walk aways”:
Kroft observes to real estate agent Kevin Moran. “There was a time, I think, when people felt really bad about not paying off a debt.”
“Yeah, I think in those days, loans were made by your local banker or building and loan associations or savings and loan,” Moran replies. “They were guys you saw in the grocery store. They were on the little league team with you, the PTA, the school. And I think as mortgages became securitized and Wall Street became involved, they became very transactional and there was no relationship built with the borrower and the lender. And I think that makes it easier for someone to see it as an anonymous party at the other end of the transaction and just walk away from it.”
“Just a business decision,” Kroft says.
Implicit in this segment is that families are not entitled to make “business decisions.” But you know who is entitled? Why, businesses of course. When businesses laid off 1.5 million workers in 2007, it was purely a “business decision.” When Wall Street banks “wrote down” more than $100 billion in losses in 2007, it was purely a “business decision.”
Look for families to become more comfortable making “business decisions” of their own in 2008.
As the Greeks well knew, the vital ingredient for shame – and, correspondingly, honor – to function in society was immediacy and care for the people in one’s polis, their views and opinions, the esteem they bestowed or withheld. Elites were honored in our society to the extent that they were themselves exemplars of the virtues that they both preached and expected of others in turn. The current widespread hostility to all these elites – Wall Street, lawyers, doctors, politicians – reflects the breakdown of a covenant of respect and honor. As our economy has become more abstract and distant, as our “communities” are compared to bedrooms (or perhaps, more aptly, hotel rooms), as our sense of continuity between past and future has been undermined by rampant mobility, impermanence and instability, there can be little wonder that “shamelessness” has spread like a contagion through our society. Such lack of shame and disregard of honor began at the top and now ripples downward through the feeding chain of class and status. Indeed, the idea that one would walk away from a house requires just such a perspective – it’s just a house, made of cheap 2×4 studs (that aren’t even 2×4 anymore, but a bit smaller) and drywall. We live not in homes, a vital part of a neighborhood, a town, a community – but in cheap structures without inherent worth. Just as our economy has shown us no sense of obligation and concern, so too in return are ordinary people shucking off the social norms or covenants that bound us in communion and fidelity. There is a great unraveling taking place, and at times I do truly fear for the future of this nation.