I interviewed Alan Blinder, NBR commentator, Princeton professor and former vice-Chairman of the Federal Reserve, about an Op-Ed piece he wrote for the New York Times. In it he advocates the re-creation of the depression-era Home Owners’ Loan Corporation, which would be able to help homeowners unable to meet their obligations refinance into something they can handle.

This idea was floated in Congress about a month ago and was quickly attacked by Republicans as a “bail-out” and by financial industry representatives as government interference with the free market. Today Chris Dodd, Chairman of the Senate Banking Committee, said he was taking another look and he might like to read the Blinder column as homework.

There is no question that taxpayer’s money will be put at risk if something like the HOLC is created. But the depression-era HOLC didn’t lose a penny. It was disbanded in 1951 with a profit on the books. And a lot of homeowners still in their homes. Just a thought.