Lets Forget About the Moral Hazard

David Brooks a columnists for the NY Times bats for the economic stimulus package in his most recent op-ed column. This column was in response to Rick Santelli's rant on CNBC against the administrations housing rescue package, about how it will increase moral hazard by rewarding people who made bad decisions. Below is a brief excerpt from his column.

Government isn’t fundamentally in the Last Judgment business, making sure everybody serves penance for their sins. In times like these, government is fundamentally in the business of stabilizing the economic system as a whole. Individual responsibility doesn’t mean much in an economy like this one. We all know people who have been laid off through no fault of their own. The responsible have been punished along with the profligate.
It makes sense for the government to intervene to try to reduce the oscillation. It makes sense for government to try to restore some communal order. And the sad reality is that in these circumstances government has to spend money on precisely those sectors that have been swinging most wildly — housing, finance, etc. It has to help stabilize people who have been idiots.

Also see Robert Gibbs, the current Press Secretary respond to Rick Santelli.