Start with class warfare rhetoric, then try to don the garb of the rational intellect. I am not impressed.

What is the difference between insuring the individual homeowners collectively, or the organization individually? From an operational standpoint, nothing except you would need a HUGE bureaucracy to administer things on an individual level. If 100 M in mortgages "non perform", shall we track down those 100,000 home owners, write individual checks to them, or shall we (the tax payers) just write one check. Or loan Fannie/Freddie no interest capital and see if they cannot make some of the loans "perform."

And part (only part) of the problem is that people who would not have been even considered for traditional home loans were loaned money, couldn't pay and defaulted on their loans. Yes, most of them were probably working poor--those on welfare are probably in HUD subsidized housing, not trying to enjoy the "American Dream." This, too, is far from laissez faire capitalism, where the welfare recipients would be living in Hoovervilles, and probably most of the working poor, too. We haven't seen that since Great Depression, #1.