I know a longtime real estate agent who is one of the most conservative men in the whole wide world - and I don't mean the typical dittohead who listens to Rush Limbaugh's smug, sarcastic rhetoric and repeats it, with variations, at the slightest provocation. I'm talking old-school conservative: a businessman who lives by a creed of realism, rational caution and common sense. He's well-informed but doesn't express strident political views. He's smart with the dollar, which is why he has a few million of them.
So I was surprised to hear him say, just as America's housing bubble was starting to burst, that he had seen nothing wrong with people buying houses with no money down.
This is a gray-flannel man, understand, a millionaire who lives modestly, watches the markets daily and makes conservative investments. He's the steward of a profitable, family-run company.
This is the fellow who advised me never to buy a house without first saving for a deposit of at least 20 percent of the purchase price, and 25 percent if possible. The monthly mortgage should equal no more than one week's gross salary of the top breadwinner.
But here he was, 30 years later, saying zero-down had been a good practice.
I was flabbergasted. If my gray-flannel friend was down with zero-down - and all the other modern tricks of financing a home - then certainly we were headed fast toward the cliffs.
In the go-go years of America's housing market, it was pretty much anything goes. Whether their credit was good, mediocre or rotten, people were encouraged to get into housing, and millions did. Real estate agents, speculators and mortgage brokers had a grand time. The old Yankee rules - saving money, buying smart, taking a mortgage that still left room for other bills - were dismissed as quaint notions.
And so here we are, in a state of shock from the market collapse and the credit crunch, with the new president offering a $75 billion bailout for American homeowners facing foreclosure amid this extraordinary economic storm.
"My husband and I recently received a foreclosure for our house in Baltimore," a woman named Stacy Hernandez wrote me last week. "We bought our house two and a half years ago. We have made a little dent in the mortgage. We can't sell the house because we will lose a lot of money."
Ms. Hernandez says income loss is what triggered the foreclosure. Her husband, a Realtor, has been looking for new work. She had been a stay-at-home mom but now has a full-time job. "I have to pick what bills we pay," she says. "If there is money left over after paying the mortgage, it goes to food, diapers, child care, gas. We did not live nor did we buy beyond our means. We had excellent credit, and were very responsible with all of our bills. Now we are scrambling to find ways to make ends meet."
The Obama administration proposes a loan modification program to allow millions of "responsible homeowners" to refinance to interest rates as low as 2 percent.
Some on the ranting right, such as the CNBC commentator Rick Santelli, accuse the Obama administration of bailing out "losers," though the hypocrisy of a Wall Street analyst complaining about a bailout for "losers" was stunning.
Still, Mr. Santelli's remark is reflective of a sentiment that's out there: While some Americans believe that banks and insurance companies are "too big to fail," some Americans believe their neighbors are "too little to save." I don't get that. Who wants to see properties in foreclosure in their neighborhoods? Who wants to see people who are still employed lose their homes? Why not push the lenders to readjust terms with the borrowers as the housing market goes through this massive correction?
That's not wild-eyed socialism. That's the credo of realism, rational caution and common sense.
Dan Rodricks' column appears Sundays on this page and Tuesdays in the news pages. He is host of the midday talk show on WYPR-FM.