As a super hero, the government's about as nimble as a brontosaurus.
Case in point: More than 62,700 Tampa Bay properties got foreclosure notices last year. About 2,720 distressed property owners have benefited fully from the government's leading anti-foreclosure program.
When you reach just 4 percent of homeowners in financial peril, it's tough to trumpet your success, though I'm sure the lucky one-in-25 are grateful for the helping hand.
We're talking about Making Home Affordable, launched a year ago with hopes of helping up to 4 million distressed homeowners. If your monthly mortgage exceeds 31 percent of income, the government subsidizes banks to modify the loan, usually by lowering interest rates.
In a surge of interest starting this past summer, at least 15,577 Tampa Bay residents signed up for the program. To qualify, homeowners have to cite a hardship, the most frequently mentioned being loss of income.
If the homeowner successfully makes his newly lowered house payment during a three-month trial, the loan modification becomes more or less permanent.
Florida's success rate is as dismal as Tampa Bay's. About 21,100 mortgages have been permanently modified out of 123,144 applicants for Making Home Affordable.
The housing market was pleading for a stronger antidote. Bank of America, the nation's largest retail bank, answered the call this week. It says it will start forgiving loan principal on tens of thousands of underwater mortgages. Other banks will certainly follow the lead of the big wheel from Charlotte.
Making Home Affordable contains a loan forgiveness provision, but it's strictly a break-in-case-of-emergency measure used only when interest reduction and time extensions fail.
Here's where things get messy.
Though it's underperforming, Making Home Affordable makes a claim to fairness when it slashes a homeowner's mortgage rate from, say, 7 percent to 4.5 percent. In a non-depreciating market, those folks, with sufficiently good credit, would have been able to refinance at market rates hovering around 4.9 percent. By essentially letting Washington be co-signer of their loans, homeowners borrow cheap money already in circulation.
Outright loan forgiveness is another matter. It rewards one of the worst practices of the last housing boom: buying overpriced homes with little or no money down. It's a big reason half of Tampa Bay homeowners with mortgages owe more on their loans than their homes are worth.
Consider the wise home buyer who sold his old house in 2004 and poured $100,000 of his savings into a new house. He's not looking so wise anymore. Depreciation has probably wiped out his $100,000. But he's not so deeply underwater as to catch the attention of the D.C. Debt Forgiveness League.
But Washington is eager to play up its successes among the distressed homeowners who have attracted its help. In announcing Making Home Affordable last year, the U.S. Treasury bragged it would help as many as 4 million financially flailing homesteaders.
But observe this footnote on the most recent program update: Even tens of thousands of borrowers rejected during their trial periods, some for nonpayment, were counted as "helped."
I can hear it already: We tried to pull you lard butts off the precipice, but we lost our grip.