An op-ed published by former FDIC chairman William Isaac talks some sense into the current housing and credit crisis; and it’s a viewpoint that I think is being swallowed up by bellowing over Congress’ need to do something about troubled homeowners and rising foreclosures. On housing, some sanity:

At the risk of being politically incorrect, I’m not sure why we are upset about a 20%-off sale in housing. After years of double-digit increases, housing prices in the city in which I live, Sarasota, Fla., jumped an astonishing 35% in 2005 – an unsustainable rate of increase that was pushing housing prices beyond the reach of far too many people. We really needed our housing markets to cool down quite substantially. Millions of people – particularly the young – will benefit from a significant reduction in housing prices. While those who purchased homes in the past couple of years are unhappy if their investment is under water, the housing markets will be back for those who are able to hang on – with help from their lenders where appropriate. Congress’s $300 billion “rescue” plan notwithstanding, the good news is that we have a lot of housing stock at more affordable prices for our growing population.

Which leads me to wonder if Congress is focusing on the whines of Boomers — many of whom over-allocated and over-leveraged themselves into real estate after the stock bubble collapse earlier this decade — at the expense of the Xes and Yes out there. That matters to a lot to this writer, who just turned 33. I left Southern California — and all of my immediate family, too, for that matter — behind in 2005 when my daughter was about to be born, because I found that I couldn’t justify paying $800,000 for a junked-up, 1,200 square foot cracker box. I especially couldn’t reconcile how a broker was telling me that we could afford 100 percent financing at that absurd price point, given that I was a PhD student making $17,000 per year at the time, and my wife was making the median for a science geek working in the R&D trenches. It’s not been easy raising a family in Texas, where we ended up, far away from family members that could otherwise help. But we’ve made do. We’ve found new jobs (obviously, yours truly is now running the most-read news source in the mortgage trade). We’ve managed the middle-of-the-night emergency hospital trips for our sick newborn son, with a 3-year old sister in tow, and no family nearby to help. We’ve managed to teach our kids who their grandparents and aunts and uncles are through pictures we’ve pasted to some posterboard. We’ve saved and bought the house we wanted, and we did all of it because we wanted to provide a stable home for our kids. We’ve paid what I think is a steep personal price. After what my wife and I have gone through, the mere thought — taxpayer funded or not — that less responsible homeowners in California, duped or not, might get a lifeline that helps them keep their home and their credit intact, just incenses me. Actually it does more than that. It makes me want to have Barney Frank and Chris Dodd — and any other House or Senate member that talks in broad terms about stopping the downward spiral of housing prices — explain to me personally why the price my family was forced to pay matters less than the housing prices they’re so focused on trying to prop up. I want them to explain to my kids why they’re helping the very people that helped make grandma and grandpa into a picture and a phone call. A housing price correction is exactly what’s needed to prevent other young families — families like mine — from having to make the same painful choice we were forced to make two and a half years ago. Unfortunately, that viewpoint seems to carry little currency in the current political climate. And that’s a shame for anyone under the age of 40 trying to raise a family in this country.