For the second time in as many weeks, the New York Times tries to make sense of the nation's housing crisis and editorializes in favor of expanded bankruptcy protection and against "voluntary" efforts to forestall further foreclosures and foster re-financings, but it flies in the face of the facts:

Most important, Congress must not continue with efforts that have not worked to date, namely, appeals to the mortgage industry to act voluntarily to help distressed borrowers. Instead, lawmakers should allow bankrupt homeowners to have their mortgages modified under court protection.

This formulation does a disservice to readers and is likely to be ignored by policymakers seeking sensible solutions to the housing crisis for two reasons:

• False Dichotomy: foreclosure prevention via re-financings does not preclude prevention via bankruptcy, or vice-versa. To suggest otherwise irrationally removes a vital policy tool from among the viable solutions available to policymakers.
• Laissez-Faire vs. Incentivized 'Voluntary" Programs: President Bush's "HOPE" program is aptly named -- borrowers and lenders can only hope their counterparts are willing to re-negotiate; Barney Frank's plan rewards borrowers and lenders who voluntarily re-negotiate.

As we commented, last week's editorial put forth the very same false dichotomy, so the Times reader is now left to puzzle this out: why is the paper suggesting that without a bankruptcy provision, any housing bill is really a mortgage industry bailout? The merits aside, the legislative reality is that the bankruptcy provision faces long odds: it was defeated 36-58 by the Senate on April 3 -- 11 Democrats voting against. Bush has promised to veto the provision. Does the Times mean to suggest that there are no viable legislative solutions to the housing crisis?

Saturday's New York Times reported on an emerging if-you-can't-beat-them-join-them strategy congressional Democrats are weighing as Congress takes up the Bush administration's request for a $108 billion supplemental war spending package for FY08:

Congressional Democrats have said that they will not simply grant Mr. Bush's request, but will once again seek to attach strings, including a requirement that Iraq pay a higher share of the costs. The Democrats also plan to add up to $30 billion in domestic spending that they say is needed to help the economy. Some Democrats are also trying to approve an additional $70 billion to sustain military operations through the end of Mr. Bush's term.

The theory: give President Bush so much more than than he has asked for that he won't look the legislative gift horse in the mouth and veto domestic stimulus add-ons, as he had threatened to do if such items were added to his original $108 billion request. And what a gift -- an extra $70 billion in war spending to be used "through the end of Mr. Bush's term" -- that is, in the three-plus months of FY09 before Bush leaves office on Jan. 20, 2009.

This would add up to a supersized $208 billion supplemental -- the largest in history, by far.

Image by Flickr user ERIK98122 used under a Creative Commons license.

Hurling invective at earmarks and deriding them all as wasteful "bridges to nowhere," is a popular theme these days. However, as Sen. John McCain (R-AZ) has recently demonstrated, adopting a pox-on-all-earmarks position can quickly dissolve into a cafeteria-style earmark policy: "I like this earmark and this earmark, but not that one over there."

Yesterday, ThinkProgress noted that Sen. John McCain's (R-AZ) plan to abolish earmarks from the federal budget would result in the elimination of U.S. funding assistance to Israel. McCain's presidential campaign responded to the finding by saying that, as president, McCain would "ensure America remains committed to the security of Israel, including maintaining America's assistance levels."

...

McCain has already made an exception for the $3 billion in foreign aid to Israel that is cited by the CRS. But he apparently is still willing to cut the rest of the earmarks in the CRS report. According to an analysis by Center for American Progress Senior Fellow Scott Lilly, that CRS report includes assistance to Egypt, Jordan, and Haiti as an earmark. Moreover, it includes funding for military family housing.

The fact is, there is nothing inherently nefarious about funding Congressperson-requested projects—some projects may be more useful, more appreciated, or otherwise "better" than others, but that a Congressperson has asked for it doesn't make it necessarily wasteful. And calling for an outright ban on earmarks will cut spending on programs that not everyone finds offensive - like the Iraq Study Group, for instance. This is not to say that the earmark process is not subject to abuses, however, but rather than prohibiting a particular spending mechanism, it makes more sense to bring the to the process a level scrutiny that will allow Congress and its constituents to debate the merits of these projects.

Sens. Ben Nelson (D-NE), Susan Collins (R-ME), and Evan Bayh (D-IN) are calling for war spending language that would shift some reconstruction costs to Iraqis. Their proposal would convert U.S. reconstruction funds from grants to loans. Citing Iraq's budget surplus and the U.S.'s deficit, Nelson said that Iraq must take fiscal responsibility for its reconstruction.

With Iraq's projected budget surplus estimated at $60 billion and the United States grappling with an ever-growing debt and spiraling deficits, we must look for solutions to end Iraq's cycle of dependence on American taxpayers. Iraq must take more responsibility for its own future by shouldering more of the costs for reconstruction and security. The era of the Administration's blank check policy for Iraq must come to an end.

This is departure from Secretary of State Colin Powell's dictum that the U.S.'s invasion of Iraq entails ownership of the outcome. It will be interesting to see if the Nelson-Collins approach creeps into other aspects of Iraq spending. Is it conceivable that the Pentagon could/would bill Iraq's established, but highly-factional government for the use of our military?

The Washington Post reported this morning that U.S. nuclear weapons labs are losing staff and not undertaking necessary and valuable research because of budget cuts. From the Post article:

The directors of the nation's three national nuclear weapons laboratories say that budget cuts by Congress and the Bush administration have reduced their ability to carry out scientific research needed to ensure the reliability of the nation's nuclear arsenal in future years.