It’s hard to be a social liberal and still be in favor of a government that does not intrude in the private lives of individuals. How does a government help its population without intruding like a parent that keeps telling its children, “No, no, no. You’re doing this all wrong. Let me show you how. If you do fail I will be there to help pick up the pieces.”
I have been briefed by a few people who have teaser rate, adjustable rate home loans. Every one of them knew that they had acquired loans that could be financially devastating. I know that many people have claimed that they were misled about the low interest rate loans that enabled them to buy a home. How could they not know they were in for trouble when the payments were so low and the down payments were either nothing or near nothing?
Now a California assemblyman wants to add another bureaucratic layer to help people with their financial literacy. This proposed law is AB 2123, California Financial Literacy Initiative, is for the training of the public in financial literacy. This proposed law is supported by the AARP. The AARP brought the law to my attention.
The money to provide the education would come from donations from nonprofit entities into an educational fund. However, there would be a cost to the state in the form of a Financial Literacy Advisory Committee. There is no explanation how the committee would be funded. I foresee another government mandated activity that could cost all Californians more tax dollars.
I am sympathetic to everyone’s plight as I had a near bankruptcy experience about 25 years ago. It was not the result of an adjustable rate loan. It was the result of a job loss.
California government is in financial difficulty. This is not the time to enact any new laws. Has anyone heard of the library? Those are marvelous places where the books on all subjects are free to read.
Coast Contact 