Lots of cheap mortgages worked out great here. So they’re bound to work out in the Palestinian Authority. Or maybe not?
The U.S. government will soon award nearly half a billion dollars in aid to Palestinians oughtn’t to have been news.
As Americans recently learned only too well themselves, mortgages, when divorced from a robust economy in which people are able to make enough money to pay them back, have a tendency to make the ground tremble. Seemingly oblivious to the searing lessons of America’s costly flirtation with unaffordable mortgages, Palestinians have been gobbling up the stuff: Personal debt has more than doubled between 2008 and 2011 and spiked another 40 percent in 2012, with most of the increase due to home loans.
There’s no reason for them not to gobble up all that money because we’re talking about the world’s most ridiculously violent welfare state with all the sense of personal responsibility of a crack addict.
The story is a familiar one.
In recent years, the increased availability of mortgages and consumer loans instead of cash for the middle class has caused personal debt to balloon in the Palestinian territories. It more than doubled, to about $750 million, from 2008 to the end of 2011 and rose 40% over the last year alone, according to figures from the Palestinian Authority.
Nidal Barghouti, general manager of Palestine Islamic Bank, where mortgage lending has risen to $40 million from nothing five years ago, said he worries because some banks are being aggressive about attracting customers to their retail business and many people are not used to debt.
“Borrowers don’t care as much when it’s easy money,” he said.
Foreclosures and evictions are virtually nonexistent in the West Bank because cultural pressure makes it difficult for lenders to repossess property in the close-knit Palestinian society. Large extended families support one another in times of financial need and lenders would be criticized for tossing borrowers out on the street, particularly if the default was caused by unpaid salaries during a Palestinian Authority crisis.
Last year, the authority, with U.S. help, launched a $500-million mortgage-guarantee program in the West Bank that is expected to double the number of families who can qualify for home loans.
That was back in 2012. And Obama is doubling down on a fake economic rise in the Palestinian Authority using the same rigged game as in the United States.
The United States is guaranteeing loans that won’t be paid back. It’s more wealth redistribution. This time to terrorists.