There's a sort of catch-all piece in the Sun-Sentinel about the luckiest man in the Florida Democratic party, Senator Bill Nelson, and it hits on three big things he's involved in right now. The first is a gross bit of hyperbole about there being "blood on the floor" if the Democratic party nomination goes on all summer and the last is about how he's expected to "grill" Gen. Petraeus and Amb. Crocker as they testify before Congress about the Iraq War debacle.

But stuck into the middle is one of the worst ideas I've heard come out of the mortgage crisis.

Nelson will seek approval Tuesday of an amendment that would allow homeowners facing foreclosure to tap up to $25,000 of their long-term retirement savings to pay mortgage costs without the ordinary 10 percent penalty for an early 401k withdrawal.
Senator, you don't want to encourage this behavior of allowing people to pull money from their 401(K) plans in order to pay exorbitant mortgages. This goes beyond robbing Peter to pay Paul. This is robbing Peter, paying Paul, and still winding up broke and homeless in your 70s, eating ramen noodles and living in your child's garage. The time to do that is in your 20s, when you're in college.

Look, by encouraging people to pull money out of their retirement accounts to pay their mortgages, you're not solving the problem, which is that 1) property values have gone unsustainably high and that 2) mortgage companies often wrote loans they shouldn't have. You're rewarding the wrong people here by rewarding the mortgage and financial industries. I've heard a lot of people yelling about how buyers made bad decisions and that they should have to pay for that, but not so much about the worse decisions that the mortgage and banking industries made by making the loans in the first place, and even less about the levels of fraud that went along with this chasing after ever-greater profits.

But this is insanity. Doing nothing would be preferable to making it easy for people who are desperate, who have bought into the idea that they're solely responsible for this mortgage crisis, to sabotage their futures by pulling money out of a retirement account and throwing it down a mortgage sinkhole. The best idea is to change the rules to allow judges to reqrite mortgages for people going through bankruptcy, and reregulating the banking industry so it can't pull this kind of crap again.

Look, Senator, you're supposed to represent us, the people of the state of Florida. So represent.

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